Development Funding Agreement for Australia

Development Funding Agreement Template for Australia

A Development Funding Agreement governed by Australian law establishes the terms and conditions under which funding is provided for a development project. The agreement outlines the funding mechanism, drawdown conditions, development obligations, project milestones, reporting requirements, and security arrangements. It incorporates Australian-specific legal requirements, including compliance with state-based security of payment legislation, environmental regulations, and corporate law requirements. The document serves as the primary agreement between the funder(s) and developer, detailing risk allocation, project governance, and completion requirements.

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What is a Development Funding Agreement?

The Development Funding Agreement is a crucial document used in Australian development projects where external funding is required for construction or property development activities. It serves as the primary agreement between funders and developers, establishing the legal framework for the funding arrangement while ensuring compliance with Australian federal and state legislation. This agreement type is particularly important in the current market where traditional bank funding may be supplemented or replaced by alternative funding sources. The Development Funding Agreement typically includes detailed provisions for funding drawdown, project milestones, cost management, security arrangements, and risk allocation. It must be tailored to address specific project requirements while maintaining compliance with Australian regulatory requirements, including securities law, environmental regulations, and building codes.

What sections should be included in a Development Funding Agreement?

1. Parties: Identifies all parties to the agreement including the funder(s) and developer

2. Background: Contextual information about the development project and funding arrangement

3. Definitions and Interpretation: Defines key terms and sets out interpretation principles

4. Funding Terms: Details of the funding amount, drawdown conditions, and repayment terms

5. Development Project Scope: Detailed description of the development project and its objectives

6. Conditions Precedent: Conditions that must be satisfied before funding becomes available

7. Drawdown Mechanics: Processes and requirements for accessing the funding

8. Developer Obligations: Key obligations, warranties, and undertakings of the developer

9. Project Milestones: Key development milestones and timeline requirements

10. Reporting Requirements: Financial and project progress reporting obligations

11. Events of Default: Circumstances constituting default and their consequences

12. Termination: Termination rights and processes

13. Dispute Resolution: Procedures for resolving disputes between parties

14. General Provisions: Standard boilerplate clauses including notices, governing law, and assignment

What sections are optional to include in a Development Funding Agreement?

1. Security Arrangements: Required when the funding is secured against assets or requires guarantees

2. Multiple Funder Provisions: Required when there are multiple funders to address priority and voting rights

3. Cost Overrun Provisions: Required when specific arrangements for handling cost overruns are needed

4. Environmental Obligations: Required for developments with significant environmental considerations

5. Interface Provisions: Required when the development interfaces with other projects or infrastructure

6. Indigenous Land Use Provisions: Required when the development affects indigenous lands or requires native title considerations

7. Foreign Investment Provisions: Required when foreign investment approval is needed

8. Step-in Rights: Required when the funder needs the right to take control of the project in certain circumstances

What schedules should be included in a Development Funding Agreement?

1. Project Details: Detailed description of the development project including plans and specifications

2. Development Budget: Detailed project budget and cost breakdown

3. Drawdown Schedule: Detailed schedule of funding availability and drawdown requirements

4. Form of Drawdown Notice: Template for drawdown requests

5. Security Documents: Forms of security documents and guarantees

6. Project Timeline: Detailed project schedule and milestone dates

7. Reporting Templates: Templates for required financial and progress reports

8. Key Personnel: List of key project personnel and their roles

9. Required Approvals: List of required permits, licenses, and approvals

10. Form of Progress Certificate: Template for certifying completion of project milestones

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Australia

Publisher

Genie AI

Sector

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Real Estate

Construction

Infrastructure

Commercial Property

Residential Development

Industrial Development

Retail Development

Mixed-Use Development

Healthcare Facilities

Education Facilities

Hospitality

Renewable Energy

Relevant Teams

Legal

Finance

Development

Construction

Risk and Compliance

Treasury

Investment

Commercial

Project Management

Property

Relevant Roles

Chief Financial Officer

Development Director

Project Director

Legal Counsel

Finance Manager

Development Manager

Construction Manager

Risk Manager

Investment Manager

Commercial Director

Project Finance Manager

Property Director

Compliance Officer

Treasury Manager

Fund Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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