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Completion Guaranty
Practical Law Glossary Item 3-422-4325 (Approx. 3 pages)
Glossary
Completion Guaranty
A guaranty granted by a project sponsor or a contractor to ensure a facility or project achieves final completion. In the case of:
- The project sponsor, it agrees to make subordinated loans or equity contributions to the project company under specified circumstances to complete construction of the project.
- The contractor, an agreement to complete the project in accordance with agreed specifications. This obligation is often secured by a performance bond.
For more information on completion guarantees, see Practice Notes, Completion Guaranties in Construction Financing and Understanding Project Finance Construction Contracts and Standard Document, Project Finance Risk Matrix.