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Facility Agreement for Switzerland

Facility Agreement Template for Switzerland

A Swiss law-governed Facility Agreement is a comprehensive legal document that establishes the terms and conditions under which a lender or group of lenders provides financial facilities to a borrower. The agreement is structured in accordance with Swiss legal requirements, particularly the Swiss Code of Obligations, and includes detailed provisions on facility terms, drawdown mechanics, representations and warranties, covenants, and events of default. It incorporates specific Swiss law concepts and requirements while following international lending practices, making it suitable for both domestic and cross-border financing transactions.

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What is a Facility Agreement?

A Facility Agreement is a crucial document in corporate lending transactions, used when a lender or consortium of lenders provides financial facilities to a borrower. Under Swiss law, these agreements must comply with the Swiss Code of Obligations and related banking regulations while incorporating international best practices. The document typically details the facility amount, purpose, drawdown conditions, repayment terms, security arrangements (if any), and the parties' rights and obligations. It's particularly important in corporate finance, project finance, and general corporate lending scenarios, where it serves as the primary document governing the lending relationship. The Facility Agreement may be used for various purposes including working capital financing, acquisition financing, project financing, or refinancing existing debt.

What sections should be included in a Facility Agreement?

1. Parties: Identification of the lender(s), borrower(s), and any other parties to the agreement

2. Background: Context of the facility and purpose of the agreement

3. Definitions and Interpretation: Definitions of terms used in the agreement and rules of interpretation

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

5. Conditions Precedent: Conditions that must be satisfied before drawdown

6. Drawdown: Procedures and requirements for utilizing the facility

7. Interest: Interest rate, calculation periods, and payment provisions

8. Repayment and Prepayment: Terms for scheduled repayment and voluntary/mandatory prepayment

9. Representations and Warranties: Statements of fact and assurances given by the borrower

10. Information Undertakings: Obligations to provide financial and other information

11. General Undertakings: Positive and negative covenants of the borrower

12. Events of Default: Circumstances constituting default and consequences

13. Changes to Parties: Provisions for transfer, assignment, and substitution of parties

14. Administration: Administrative provisions including calculations and payments

15. Notices: Methods and requirements for formal communications

16. Governing Law and Jurisdiction: Choice of Swiss law and jurisdiction provisions

What sections are optional to include in a Facility Agreement?

1. Security: Required if the facility is secured; details security arrangements and enforcement

2. Guarantees: Required if there are guarantors; contains guarantee provisions

3. Accordion Feature: Optional provision allowing for future increase in facility amount

4. Multi-currency Provisions: Required for facilities available in multiple currencies

5. Syndication Provisions: Required for syndicated facilities; includes facility agent and voting provisions

6. Tax Gross-up and Indemnities: Detailed tax provisions, particularly important for cross-border facilities

7. Increased Costs: Provisions dealing with regulatory changes affecting lenders' costs

8. Market Disruption: Provisions addressing market disruption events affecting interest rates

9. Anti-corruption Provisions: Detailed compliance provisions for regulated entities or cross-border facilities

What schedules should be included in a Facility Agreement?

1. Conditions Precedent: Detailed list of required documents and conditions

2. Form of Drawdown Request: Template for borrower to request utilization of the facility

3. Form of Transfer Certificate: Template for transferring commitments between lenders

4. Repayment Schedule: Detailed schedule of repayment dates and amounts

5. Form of Compliance Certificate: Template for periodic compliance certification

6. Financial Covenants Calculations: Detailed methods for calculating financial covenants

7. Security Documents: List and/or copies of security documents if facility is secured

8. Existing Security and Financial Indebtedness: Details of permitted existing arrangements

9. Group Structure Chart: Corporate structure of borrower group

10. Form of Accession Deed: Template for additional parties joining the agreement

Authors

Alex Denne

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

Jurisdiction

Switzerland

Publisher

Ƶ

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions
































































Clauses





































Relevant Industries

Banking

Financial Services

Corporate Lending

Investment Banking

Private Equity

Real Estate

Infrastructure

Manufacturing

Energy

Healthcare

Technology

Telecommunications

Retail

Hospitality

Relevant Teams

Legal

Finance

Treasury

Risk Management

Compliance

Credit

Corporate Finance

Banking

Debt Finance

Transaction Management

Portfolio Management

Relevant Roles

Chief Financial Officer

Finance Director

Treasury Manager

Legal Counsel

General Counsel

Corporate Lawyer

Banking Lawyer

Relationship Manager

Credit Officer

Risk Manager

Compliance Officer

Transaction Manager

Corporate Finance Manager

Investment Manager

Portfolio Manager

Industries







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