The Role of Documentation

The Contractual Relationship - Requirements for a Valid Contract

• Offer and acceptance
• Consideration
• Intention to create legal relations
• Legality

Breach of Contract

• Defences available against breach of contract
• Dangers for lenders

The Loan Agreement

• Review of fundamental legal clauses, including:
  • Undertakings: general and financial
  • Representations and warranties
  • Events of default and waivers of default
  • Set-off
  • Transfers: assignment, novation, sub-participation

Syndicated Facilities

• The responsibilities of arranger and facility agent
• Rights of participating banks

Guarantees and Indemnities

• Essential clauses

Letters of Support

The Effectiveness of Security

• Essential clauses in security documentation
• Creditor ranking in liquidation
• Types of security interest:
  • Lien
  • Pledge
  • Fixed charge
  • Floating charge
  • Mortgage

Factors to Consider When Taking Security Over:

• Property
• Shares
• Life policies
• Debentures

Insolvency Schemes

• Schemes of arrangement
• Receivership
• Administrative receivership
• Administration
• Liquidation

Loan Documentation Perils in the Pre-Insolvency Period

Transactions That Can Be Invalidated