Model Consent to Assignment for Project Finance Transactions (with Commentary)

The model Consent to Assignment and accompanying commentary have been prepared by the Project Finance and Development Committee of the American Bar Association's Section of Business Law as a reference available for use by practitioners when negotiating and documenting the terms of a project finance transaction requiring such an agreement. The commentary is intended to provide an understanding of the constituent elements of the model Consent to Assignment, how those elements work together as a whole, and, where appropriate, why they are used. When securing financing for a project, a Consent to Assignment would typically be used to facilitate the rights of lenders that have taken a security interest in all of the project assets as collateral for the financing. Lenders need the right to take possession of the project to exercise their remedies properly, which in most cases include the right to sell the secured assets, as well as the right to take any steps necessary to complete the project where applicable.