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Who should attend
- In-house lawyers in banks and financial institutions
- Bankers concerned with the negotiation of loans
- Bank executive involved in the documentation of loans
- Lawyers in private practice who advise clients on loan agreements
- Corporate counsel
- Credit control officers
- Credit administration officers
About the course
The course studies the structural and commercial side of the loan agreement
This course is the follow on to our ever popular loan documentation training programme that has run for more than ten years. The course will deal with the more structural and commercial side of the loan agreement and will give delegates more opportunities to practice making and responding to comments on the documents.
In three days the course will cover a substantial range of topics including structural issues, contractual support arrangements, key clauses in the loan agreement, the loan agreement in different commercial contexts and legal issues that arise in financing transactions.
The course will consist of a series of lectures and workshops that will provide you with a practical insight into dealing with the documentation of loans. By the end of the course you will be thoroughly familiar with the most important aspects of loan documentation.
This course will help you
- Understand the essential elements of various loan transactions
- Appreciate how to avoid the conflict between representations, conditions precedent, undertakings and events of default
- Gain a thorough understanding of different forms of contractual support and their advantages and disadvantages as compared with claims in debt
- Discuss a variety of issues and comments on the loan agreement which are commonly raised by borrowers
- Improve your knowledge of other common financing documents including a contract assignment and a subordination agreement
- Be able to negotiate key clauses in a financing package
- Master the important legal issues which commonly arise in a financing transaction including trusts and fiduciary duties
Review of key loan agreement issues
- “Relevant companies”
- Conflict between representations, conditions precedent, undertakings and events of default
- The Pari Passu clause
- The negative pledge
- The cross default clause
- The material adverse change clause
- Linking the loan to the borrower’s rating
- “Material”, “reasonable” worth the debate?
- Grace periods
- Prepayment events
- Subjectivity and control in the context of events of default
Workshop 1: review clauses from a loan agreement and identify key issues for the borrower.
The loan agreement in different commercial contexts
Comparison of provisions appropriate to a corporate risk, project risk and/or an asset risk
- Financial ratios
- Additional considerations where the borrower is a special purpose company
- Homework preparation for workshop 2
### Day 2
Workshop 2: review comments from a borrower on a loan agreement and consider the bank’s response.
Key legal issues part 1: basic points
- Types of claim and remedies
Key legal issues part 2: governing law and jurisdiction
- What courts have jurisdiction to deal with disputes in an international context? What law will they apply?
Key legal issues part 3: bank/agent liabilities
Responsibility for misrepresentations
- For the arranger
- For a bank selling a participation in the secondary market
- For the borrower
- For the lawyers
- How effective are they?
Key legal issues part 4: bank/agent liabilities
Other responsibilities of the banks
- Agents and trustees
- Fiduciary duties
- Conflicts of interest
Key legal issues part 5: clawback/unenforceability
- In what circumstances might obligations be avoided or become unenforceable?
- Financial assistance
- Ultra vires
- Commercial benefit
- Transactions at an undervalue
- Interference with contacts
Workshop 3: participants will be given a scenario and asked to spot the legal issues.
- Damages and debt – what are the differences?
- Structural subordination
- Substitutes for guarantees e.g.
- Commitments to inject capital
- Comfort letters
- Put options, leases, offtake agreements and other contractual support
- Contract assignments
- Security on bank accounts
- Security, title financing and recharacterisation
Workshop 4: participants will review key terms of a contract which a bank is proposing to take as security and identify issues which need to be resolved.
- We will review a number of different intercreditor agreements relevant to different circumstances.
Sue Wright is a solicitor with over 18 years experience in international banking transactions, including syndicated loans, subordinated debt, structured finance and tax driven transactions. She was a partner in the banking department at Norton Rose for 8 years and was responsible for training ass...
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Because of COVID-19, many providers are cancelling or postponing in-person programs or providing online participation options.
We are happy to help you find a suitable online alternative.