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Senior Loan Agreement for the United States

Senior Loan Agreement Template for United States

A Senior Loan Agreement under United States law is a comprehensive financial contract that establishes the terms and conditions for a senior debt facility between a lender and borrower. The agreement details the loan amount, interest rates, repayment terms, security arrangements, and includes various protections for the lender's senior position in the capital structure. It incorporates US-specific regulatory requirements, including those under federal banking laws and state-specific lending regulations, while establishing the rights, obligations, and remedies of all parties involved in the lending relationship.

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Senior Loan Agreement

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What is a Senior Loan Agreement?

The Senior Loan Agreement is a fundamental document used in commercial lending transactions where a lender provides senior debt financing to a borrower. It is particularly relevant in the United States market where it must comply with federal and state-specific lending regulations, including truth in lending laws, usury restrictions, and UCC requirements. This agreement establishes the lender's senior position in the borrower's capital structure, typically providing priority in payment and security over other creditors. The document comprehensively covers loan terms, conditions precedent, representations and warranties, covenants, events of default, and enforcement rights. It's commonly used for corporate financing, acquisition financing, real estate development, and other commercial purposes where substantial funding is required with strong lender protections.

What sections should be included in a Senior Loan Agreement?

1. Parties: Identifies and defines the lender(s), borrower(s), and any guarantors

2. Background: Sets out the context and purpose of the loan

3. Definitions and Interpretation: Defines key terms and establishes interpretation rules

4. The Facility: Details the loan amount, purpose, and availability

5. Conditions Precedent: Specifies conditions that must be met before drawdown

6. Drawdown: Procedures and requirements for borrowing the loan

7. Interest: Interest rate, calculation methods, and payment terms

8. Repayment and Prepayment: Terms for scheduled repayments and early repayment options

9. Representations and Warranties: Borrower's statements about its legal and financial condition

10. Covenants: Ongoing obligations of the borrower including financial covenants

11. Events of Default: Circumstances that trigger default and lender's enforcement rights

12. Changes to Parties: Rules for assignments and transfers

13. Administration: Payment mechanics, calculations, and notices

14. Governing Law and Jurisdiction: Choice of law and dispute resolution provisions

15. Execution: Signature blocks and execution requirements

What sections are optional to include in a Senior Loan Agreement?

1. Security: Include when loan is secured by specific collateral

2. Guarantee: Include when third-party guarantees are part of the transaction

3. Increased Costs and Tax Gross-Up: Include for cross-border transactions or when tax implications are significant

4. Agency Provisions: Include in syndicated loans with an administrative agent

5. Majority Lenders: Include in syndicated loans to define voting rights

6. Market Disruption: Include when using floating interest rates

7. Break Costs: Include when prepayment might result in lender losses

8. Subordination: Include when there are multiple tiers of debt

9. Currency Provisions: Include for multi-currency facilities

10. Accordion Feature: Include when facility may be increased in the future

What schedules should be included in a Senior Loan Agreement?

1. Schedule 1 - Conditions Precedent Documents: List of required documents and conditions for initial drawdown

2. Schedule 2 - Form of Drawdown Request: Template for borrower to request loan disbursement

3. Schedule 3 - Repayment Schedule: Detailed schedule of repayment dates and amounts

4. Schedule 4 - Financial Covenants Calculations: Formulas and methods for calculating financial covenants

5. Schedule 5 - Form of Compliance Certificate: Template for periodic compliance reporting

6. Schedule 6 - Form of Transfer Certificate: Template for transferring loan participations

7. Schedule 7 - Existing Security: List of existing security interests and liens

8. Schedule 8 - Material Contracts: List of borrower's material contracts

9. Appendix A - Lender Commitments: Details of lending commitments (for syndicated loans)

10. Appendix B - Security Documents: Forms of security documentation

Authors

Alex Denne

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

Jurisdiction

United States

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions


















































































Clauses




































Relevant Industries

Banking

Financial Services

Real Estate

Infrastructure

Manufacturing

Energy

Healthcare

Technology

Transportation

Construction

Mining

Agriculture

Telecommunications

Retail

Hospitality

Relevant Teams

Legal

Finance

Treasury

Credit

Risk Management

Compliance

Corporate Secretariat

Banking Operations

Deal Advisory

Transaction Management

Relevant Roles

Chief Financial Officer

Treasury Manager

Finance Director

Legal Counsel

Corporate Lawyer

Compliance Officer

Risk Manager

Credit Officer

Relationship Manager

Investment Manager

Corporate Secretary

Financial Controller

Managing Director

Chief Executive Officer

Head of Credit

Loan Officer

Transaction Manager

Banking Operations 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, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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