Project finance — Checklists for events of default

Introductory note:
Events of default give lenders a mechanism under which they can, if they choose, take action against a borrower for breach of its obligations under a facility agreement or if certain other events occur.
In a project finance transaction, where the lenders are typically solely or largely reliant on the revenues of the project for repayment of the loan(s), the lenders will often want to include events of default which may help them to identify issues with the project’s progress at an early stage to enable them to impose obligations on the borrower to take any remedial steps in good time.
This checklist provides a list of events of default that legal practitioners should consider including in a facility agreement and/or a common terms agreement for a project finance transaction.