The Contract may give the Authority the right to terminate if the Contractor wilfully breaches its key obligations in relation to the refinancing provisions in the Contract. These relate to seeking Authority consent before undertaking the refinancing and acting in good faith.
Under the WIDP Contract the compensation payable is limited to the amount payable to the senior lender and the Authority has the option to pay by instalments. Given the sums involved it is important that the Contract Manager ensures that the Finance Department is involved in making the decision regarding this option.
In this scenario the Authority has the option to require the Contractor to transfer all or some of the project facilities to the Authority. Given there is no reason why the facilities should not be in full working order it would require very unusual circumstances for the Authority not to want the transfer, even if just wanted to realise the value in the facility by selling it on immediately as soon as possible.