Construction timeThe main account during this period is the construction time count, which will have different sub-accounts around it. All funds raised for the implementation of the project are transferred via the construction time account. Sponsors put funds into the sponsorship capital account (the funds are provided according to the terms of the loan agreement). Similarly, lenders` loans are paid into the credit account (disbursements based on the debt ratio and other conditions). Any other type of project financing is also transferred via the construction account. All of these sub-accounts are referred to as “flows” from the construction period account (as shown in screenshot No. 1). The funds in the construction account can only be used for specific purposes for the execution of the project. The different flow sub-accounts under the construction period account are visible in screenshot 1. The difference between the trust and retention account and the Escrow-Trust and Retention (TRA) MECHANISM TRA-mechanism account has been a common feature in the financing of infrastructure projects. The objective is to protect project lenders from credit risk (risk of default of debt service) by isolating the cash flow of the project company. This is done by transferring control of future cash flow from the hands of borrowers (project company) to an independent agent, the tra agent, duly mandated by the lenders. 2.

Infrastructure projects are implemented through a separate company created for this purpose (“zweckgesellschaft” – SPV) and the shares of the SPV would normally be held, among other things, by the project sponsors. The cash flow of the SPV (project company) is subject to a TRA agreement. As part of this agreement, the lender, borrower and TRA representative will enter into a three-part agreement that all project revenues will be paid into a single account managed by the designated TRA agent. Lenders establish, in agreement with the borrower, a detailed mandate for the TRA agent for the regular transfer and use of the funds available in the TRA. The mandate essentially outlines the nature and purpose of various payments, including debt servity to lenders. In accordance with their mandate, payment to lenders is made directly by the TRA representative without the borrower`s intervention. By operation, THE TRA can be subdivided into several sub-TRAs dedicated to separate expense/end managers. With cash flows in several currencies, there could also be separate TRAs with the same agent or various TRA agents for processing cash flows in different currencies.

Thus, on behalf of the lenders, the TRA agent acts as an agent and ensures that the cash flows of the borrower or the project company are exclusively accessible in accordance with the mandate. Thus, the TRA mechanism could be considered a sophisticated version of the traditional “No Link” accounts over which the bank concerned could not exercise its general right of guarantee. 3. It is clear that the mandate of the lenders for the acquisition of cash flow to the tra representative could impose the following order for the final use of the funds: all operating and maintenance costs of the project; Monthly contributions/limits on net capital and interest payments to lenders; A debt service reserve. B, amounting to 6 months, which could also be supported by a loan-to-term to be agreed by the sponsors of the company of the project; A cash reserve of . B four months of operating expenses; After fulfilling all of the above obligations, either by L/C or from project cash flow, the remaining funds, if any, would be available to the project company at its sole discretion or at the request of Agent DemTRA.