The direct agreement of the lenders: this is a three-way agreement between the Authority, Projectco and the lenders, under which the Authority agrees to grant lenders a deadline for the early termination of the project agreement. This agreement will also provide lenders with the opportunity to intervene directly or through a candidate or representative to resolve the termination event or to find another party that is acceptable to the Authority to assume Projectco`s rights and obligations under the project agreement. In addition to this guarantee, project lenders generally expect direct contractual relationships with counterparties with key project documents. This goal is achieved through direct agreements. Partial contracts: Projectco has contracted several subcontractors to cushion the risks it takes under the project agreement. It is customary for Projectco not to perform any of the most important activities, but rather to be a vehicle for the design of project contracts – hence the term “assignment vehicle.” Construction contract: Projectco will enter into the construction contract with the contractor under which Projectco`s construction obligations from the project contract will be transferred to the contractor. Direct agreements generally contain provisions on the following topics: Katie Liszka Direct uses direct agreements for project financing operations to protect lenders in the event of project difficulties. These are contractual mechanisms that allow lenders to follow in the footsteps of the project company (the borrower) and take over the project and/or find a replacement unit to continue the project. The parties to the direct agreement include the project company itself and the consideration for the project document for which the direct agreement is a security. ]] The >-administration collateral agreements have proven to be an extension of the concept that underlies the direct agreement of lenders.
Guarantee agreements are concluded between the Authority and the contractors who enter into a contract with Projectco. The objective is that if projectco does not meet its contractual obligations during the construction phase, the support of Projectco`s corresponding mission can guarantee the completion of the project. In addition, the Authority may take over Projectco`s operating contract at the end of the project. With regard to the first PFI projects, it was customary to have separate agreements for different phases of the project, such as. B a development agreement for the design and construction phase and an agreement to operate or manage facilities for the operating phase.