Legal Aspects of Project Finance, Nairobi

The euromoney legal training course will help you understand project financing techniques involving syndicated lending, sponsor support and a full security package.


With the general downturn in the global economy, the American power crisis, the crash of the hi-tech industry and recent global events, many banks and developers are re-examining their project finance pipelines. Governments are also moving away from "traditional" BOT and concession projects to Public Private Partnerships (PPPs). The Gulf region and China have become the centres for project finance for local and international banks. International Financial Institutions (IFIs) also continue to work in developing countries and EasternEuropean countries in transition.

The trend is towards 'keeping it simple' and using basic project financing techniques involving syndicated lending, sponsor support and a full security package. Bankability of project documentation remains crucial. In the developing world sponsors and commercial banks are also looking for political risk protection from IFIs.

How this course will help you

this course will:

  • Focus on the different documents involved
  • Analyse key provisions of project agreements and loan agreements
  • Explore security, direct & sponsor support agreements
  • Describe effective documentation techniques
  • Review main covenant issues

Who should attend?

  • In-house lawyers in banks and financial institutions
  • In-house lawyers and financial officers of project sponsors
  • Project finance and structured finance managers
  • Project lenders and sponsors
  • Bank officers responsible for evaluating or structuring projects
  • Project finance lawyers in private practice

Day 1

Introduction

  • What is project finance?
  • What is its role in concessions, BOTs and PPPs?
  • Risk
  • Bankability

The role of the project documents

  • Overview of what constitutes 'project documents' and their role in a project
  • Lender's perspectives as compared  to sponsors and offtakers

The project agreement Presentation of key issues of bankability in a project agreement, including:

  • Grant of rights
  • Site/existing assets
  • Construction
  • Operation
  • Tariff or payment
  • Step-in rights
  • Termination
  • Dispute resolution

Workshop 1

The project agreement Delegates will analyse provisions of a project agreement to identify key areas of bankability.

Turnkey construction contract

  • Presentation of turnkey construction contracts and key issues of bankability, including:
  • Single point responsibility
  • Fixed price
  • Date certain
  • Liquidated damages for delay and performance
  • Warranties
  • Termination

Operation and maintenance agreements

Presentation of key issues of bankability in O&M agreements

  • Different structures available
  • Guarantees
  • Duration

 

Day 2

Introduction

What are financing agreements?

Main particularities and typical provisions of each of the basic financing agreements will be analysed:

  • Loan agreement
  • Intercreditor agreement
  • Security documents
  • Sponsor support

Dealing with international financial Institutions

  • Lenders of last resort/preferred creditors
  • A loan & B loan

Analysing the loan agreement

  •  The term sheet
  • Overview of the structure and content of a syndicated loan agreement
  •  Key project covenants

Workshop

Analysing a project loan agreement Using a checklist of key provisions delegates will analyse a project loan agreement and will form a negotiating position on major provisions.

Examining the security documents

  • Purpose of security in project finance
  • Types of security available

Explaining the support agreements

  • The significance of support agreements
  • The sponsor's role
  • Forms of support from sponsors
  • Key provisions

 

End of course