One question that can be negotiated intensively is what lenders are responsible for when they intervene. They shall be responsible for any unpaid payments and undiled obligations of which they will be informed. The extent to which they assume responsibility for unknown and unreported liabilities is often controversial. Lenders will only want to be liable for liabilities that are informed. The third party who agrees to intervene will obviously want the lenders to be responsible for everything. In addition to accepting that the counterparty agrees not to terminate if it has the right to do so under the project document, it will also agree that the milestone process may be triggered by lenders providing a notice of default from a project company under the Facility Agreement, with the collateral being applied or the loan being accelerated. Construction Contract: Projectco enters into the Construction Contract with the Contractor, under which Projectco`s construction obligations under the Project Contract are transferred to the Contractor. Host governments/contracting authorities: The government of the country where the project is based is likely to be involved in the issuance of permits and permits at the beginning and throughout the life of a project. The client is the public municipality that contracts the project contract with Projectco.
In early PFI projects, it was common to have separate agreements for different phases of the project, such as. B, a development agreement for the design and construction phase and an operation or facilities management agreement for the operation phase. Nowadays, however, it is more common to have a single project agreement that covers all aspects of the project. Direct agreements are generally also referred to as „tripartite agreements”, which reflects the fact that they are an agreement between three parties, i.e.: Subcontracts: Various subcontracts are entered into by Projectco to pass on the risks it takes under the project agreement. It is common for Projectco not to perform any of the key activities itself, but rather a vehicle to form the contract suite associated with the project – hence the term „dedicated vehicle”. Project Agreement: The main agreement for each PFI project, the project agreement governs the relationship, rights and obligations between the authority and Projectco throughout the life of the project. It can also be called a concession contract. If necessary, a direct agreement may contain clauses in which the counterparty to the project document consents to the collection or assignment as security of the project company`s rights under the project document.
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