The Role of Direct Agreements in a PPP Project：直接协议PPP项目中的作用.ppt

Diese Pr?sentation ist nur für interne Verwendung konzipiert Tim C. Meaney DZ BANK AG Hong Kong Project Finance Agenda What is a Direct Agreement? Structural Presentation of a Direct Agreement Purposes of Direct Agreements Benefits of Direct Agreements Who Provides Direct Agreements Issues with Direct Agreements Conclusions Contact Information 1) What is a Direct Agreement? An agreement between individual Project Parties each of which is a contracting party with the PPP Concession Company (the “SPV”) and the Senior Lenders to the SPV. The objective of the Direct Agreements is to establish certain legal rights which apply when the relevant contract is threatened with termination - typically by the action or inaction of the SPV. The Direct Agreement does not transfer obligations to Lenders unless Lenders exercise their rights. 2) Structural Presentation of a Direct Agreement PPP Project - Typical Transaction Structure (simple form) 2) Structural Presentation of a Direct Agreement (cont.) PPP Project - Typical Transaction Structure (simple form) Location of Primary Direct Agreements: 3) Purposes of Direct Agreements The purpose of a Direct Agreement is to provide rights to Lenders which may permit the prevention of termination of key project contracts executed between the SPV and other Project Parties without Senior Lenders having the opportunity to consider whether to preserve the contracts by “stepping in” and curing the underlying termination event where the SPV has failed or elected not to do so. The rationale for Lenders having such rights goes back to a fundamental principle in limited recourse or project financing: 3) Purposes of Direct Agreements (cont.) The Lenders‘ primary source of repayment within a limited recourse project financing are funds generated by the Project itself and directed through the SPV. To the extent that the SPV has insufficient funds to repay the banks, then these banks may enforce and exercise their security interest ov