Agency Clauses

Summary

These Agency Clauses for a credit agreement are used to describe the role and rights of the administrative agent and other agents in a syndicated loan transaction. These clauses include practical guidance, drafting notes, and optional clauses. The administrative agent serves as the liaison between the borrower and the lenders for payments on the loans as well as notices, financial reports and other information provided by the borrowers. The collateral agent (which, in most cases, is the same bank serving as administrative agent) holds the security interest in the collateral for the benefit of all the lenders, and has the right to exercise rights and remedies against the collateral. In general, the administrative agent and collateral agent are agents of the lender parties, not the borrower. The one exception to this rule is that the administrative agent is considered the agent for the borrower for purposes of maintaining a register of the lenders for tax purposes. Note that these sample...