Project Financing Agreement Template for Germany

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Key Requirements PROMPT example:

Project Financing Agreement

"I need a Project Financing Agreement under German law for a €50 million renewable energy project in Bavaria, with three commercial banks as lenders and specific provisions for wind farm construction milestones to be completed by June 2025."

Document background
The Project Financing Agreement is a fundamental document used in structured finance transactions where funding is primarily secured by the project's assets and cash flows rather than the sponsors' balance sheets. Under German law, this agreement must comply with specific regulatory requirements including the German Banking Act (KWG) and Civil Code (BGB). It is typically used for large-scale infrastructure, energy, or industrial projects where significant capital investment is required. The document outlines all aspects of the financing arrangement including facility terms, security structure, conditions precedent, covenants, and monitoring requirements. It incorporates German-specific security interest mechanisms and must account for local registration and notarization requirements.
Suggested Sections

1. Parties: Identification of all contracting parties including lenders, borrowers, sponsors, and security agents

2. Background: Context of the project financing, project description, and purpose of the agreement

3. Definitions and Interpretation: Comprehensive definitions of terms used throughout the agreement and interpretation rules

4. Facility and Purpose: Details of the financing facility, amounts, tranches, and permitted use of proceeds

5. Conditions Precedent: Conditions that must be satisfied before drawdown, including technical, legal, and financial requirements

6. Drawdown Mechanics: Procedures and requirements for requesting and making drawdowns

7. Repayment and Prepayment: Terms for scheduled repayments, mandatory and voluntary prepayments

8. Interest and Fees: Interest calculation, payment periods, default interest, and all applicable fees

9. Security Structure: Overview of security package and ranking of security interests

10. Representations and Warranties: Standard and project-specific representations and warranties

11. Covenants: Positive, negative, and financial covenants applicable to the project and borrower

12. Project Undertakings: Specific obligations regarding project construction, operation, and maintenance

13. Monitoring and Reporting: Requirements for technical, financial, and progress reporting

14. Events of Default: Circumstances constituting default and consequences

15. Taxes and Increased Costs: Tax provisions and allocation of increased costs

16. Miscellaneous: Standard boilerplate provisions including notices, amendments, assignments

17. Governing Law and Jurisdiction: Choice of German law and jurisdiction provisions

Optional Sections

1. Intercreditor Provisions: Required when multiple lenders or creditor classes are involved, establishing ranking and decision-making processes

2. Export Credit Agency Provisions: Needed when export credit agencies are involved in the financing

3. Political Risk Insurance: Required for projects with significant political risk exposure

4. Environmental and Social Requirements: Detailed section needed for projects with significant environmental impact

5. Islamic Finance Provisions: Required when Islamic finance tranches are included in the financing structure

6. Completion Support: Needed when sponsor completion support or guarantees are part of the structure

7. Reserve Accounts: Detailed provisions required when specific reserve accounts are established

8. Step-in Rights: Required when direct agreements with major project parties are involved

Suggested Schedules

1. Project Description: Detailed technical description of the project

2. Forms of Drawdown Requests: Standard forms for utilization requests

3. Form of Transfer Certificate: Standard form for transfers of participation

4. Repayment Schedule: Detailed amortization schedule

5. Security Documents: List and copies of all security documents

6. Project Documents: List and copies of material project documents

7. Financial Model: Agreed base case financial model

8. Technical Specifications: Detailed technical requirements and specifications

9. Insurance Requirements: Required insurance coverage details

10. Form of Progress Reports: Templates for construction and operation phase reporting

11. Permits and Authorizations: List of required permits and their status

12. Financial Covenants Calculations: Methodology for financial covenant calculations

13. Security Creation and Perfection Timeline: Schedule for security implementation

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Accordion Facility
Account Bank
Additional Cost
Administrative Agent
Affiliate
Applicable Law
Applicable Margin
Approved Budget
Assignment Agreement
Authorized Representative
Available Commitment
Available Facility
Banking Day
Base Case Financial Model
Borrower
Break Costs
Business Day
Cash Flow Available for Debt Service
Change of Control
Commercial Operation Date
Commitment
Completion Date
Compliance Certificate
Construction Budget
Construction Contract
Construction Period
Cost Overrun
Debt Service Coverage Ratio
Debt Service Reserve Account
Default
Default Interest
Disruption Event
Distribution
Environmental Laws
Environmental Permits
Event of Default
Facility
Facility Agent
Facility Agreement
Fee Letter
Final Maturity Date
Finance Documents
Finance Parties
Financial Close
Financial Indebtedness
Financial Model
Financial Quarter
Financial Year
Force Majeure Event
Grundschuld
Hedging Agreement
Holdings
IFRS
Independent Engineer
Initial Security Documents
Insurance Advisor
Insurance Proceeds
Interest Payment Date
Interest Period
Lenders
Loan
Loan to Value Ratio
Majority Lenders
Major Project Documents
Material Adverse Effect
O&M Agreement
Operating Budget
Operating Costs
Original Financial Statements
Permitted Disposal
Permitted Distribution
Permitted Financial Indebtedness
Permitted Security
Project
Project Accounts
Project Assets
Project Costs
Project Documents
Project Revenues
Project Site
Quotation Day
Reference Banks
Repayment Date
Repayment Schedule
Repeating Representations
Required Insurance
Reserve Accounts
Screen Rate
Security
Security Agent
Security Documents
Security Interest
Security Period
Sponsors
Subordinated Debt
Subsidiary
Technical Advisor
Technical Description
Total Commitments
Transfer Certificate
Utilization
Utilization Date
Utilization Request
Clauses
Relevant Industries

Energy and Utilities

Infrastructure

Real Estate Development

Renewable Energy

Transportation

Industrial Manufacturing

Telecommunications

Mining and Natural Resources

Healthcare Infrastructure

Waste Management

Public-Private Partnerships

Commercial Real Estate

Relevant Teams

Legal

Finance

Treasury

Risk Management

Compliance

Project Management

Corporate Development

Investment Banking

Credit Risk

Operations

Technical Advisory

Environmental and Social

Relevant Roles

Chief Financial Officer

Project Finance Manager

Legal Counsel

Finance Director

Project Manager

Risk Manager

Treasury Manager

Investment Officer

Corporate Finance Manager

Compliance Officer

Due Diligence Officer

Contract Administrator

Financial Controller

Business Development Manager

Senior Banker

Structured Finance Associate

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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