This course will introduce students to the modern syndicated loan transaction and the principal legal and practical issues relevant to a commercial financing arrangement in today’s international financial world. The syndicated loan is the structure now typically used in bank financing of any material size and serves as the foundation of working capital (revolving) and term loan facilities in a wide range of business and commercial contexts (including both operational and acquisition financing) and constitutes an essential component of the risk management strategies generally for both borrowers and lenders. Using actual financing documents tailored to a hypothetical financing transaction, students will examine how the syndicated loan market operates and why the transactions are structured the way they are. Key to the analysis will be understanding how and why the various documents allow the parties to identify and mitigate the risks on each side. During our sessions we will begin with the bank’s preliminary expression of interest to the borrower and explore the progression of the transaction from there through the commitment letter, term sheet and related fee letter, and finally into the full loan agreement and (time permitting) the related credit support and collateral documents. While some opportunity for role playing and mock negotiation will be included, the primary focus will be on problem identification and problem solving in the transactional context and on the interplay of often-competing commercial and legal considerations in structuring and executing business arrangements. In addition, students will gain experience in navigating complex transaction documents and understanding how they work. Our goal is to give you an introduction into “transactional lawyering” and some insight into how transactional attorneys can use their “transactional lawyering skills” to make it more likely that their clients will achieve their transactional objectives.
