Some of the key definitions in any installation agreement are the main ones: the facilities and their purpose: the quantity of installations should be carefully checked, as well as the object for which they may be available. Businesses or financial alliances govern the borrower`s financial situation and health. They define certain parameters in which the borrower must operate. The borrower`s auditors should be asked to view their contents as soon as possible. The dates on which these companies are subject to review should be subject to scrutiny, as should the separate financial definitions applicable. Financial commitments are a key element of any facility agreement and are probably the most likely to cause a default event if they are breached. Stronger borrowers can negotiate a right to resolve violations of financial pacts, for example by investing more money in the business. This is called the equity cure. The existence of a union does not affect certain provisions of an ease agreement. For example, there will also be a definition of « majority lenders » that is required for approval for certain measures. It is normal for this definition to amount to two-thirds of syndicated banks based on the amount of their interest in the loan. The borrower should ensure that all unionized banks are « qualifying banks » for the above reasons, and once again, an appropriate guarantee may be appropriate.
They may also include advance information if the borrower is interested in prepaying the loan. Many borrowers are concerned about advances and you would be wise to include a clause in your credit agreement that talks about advance options, if any. If you allow a prepayment, you must include this information and details if they are allowed to pay all or part only in advance and if you charge a down payment fee if they wish. If you charge a down payment fee, you need to state in detail how much it will be. Traditionally, lenders require that a percentage of the principal be paid in advance before they can pay the balance. If you do not authorize the advance, you must state in detail that this is not permissible, unless you, the lender, have given written permission.