, LexisNexis(R) Forms FORM 80-G4-1

Summary

Prefatory Note To Forms

The following Forms, unless otherwise indicated, are documents that were initially prepared by lender’s counsel prior to any negotiations with borrower’s attorney.

With the advent of computer word-processing, the use of preprinted forms has diminished except for the smaller or less complex loan transactions. At present, many law firms representing lenders have created their own standard loan documentation library for their clients. It must be remembered by borrower’s counsel that these computerized forms contain conventional boilerplate material suited to the lender’s needs and benefit. Therefore, each document must be carefully reviewed even if they are computer printed rather than preprinted. Borrowers must be educated to this fact. They forms are only examples and are not intended to constitute legal advice for any particular situation. Lawyers must still review loan documents to assure that they fit the transaction.

Each Form is preceded by a brief note indicating the reasons it has been selected and pointing out particular provisions of interest to a borrower and its counsel.

FORMS
G4-1.	Loan Agreement Checklist
G4-2.	Loan and Security Agreement
G4-3.	Negotiation Commentary
G4-4.	Guaranty
G4-5.	Subordination Agreement
G4-6.	Pledge Agreement (Securities)
G4-7.	Pledge Agreement (Restricted Securities)
G4-8.	Securities Account Control Agreement
G4-9.	Legal Opinion (Lender’s Form)
G4-10.	Legal Opinion (Borrower’s Form)
G4-11.	Certificate of Resolutions
G4-12.	Solvency Opinion
G4-13.	Closing Agenda
G4-14.	Keep Well Agreement
G4-15.	Put Agreement
G4-16.	Junior Participation Agreement

Each lender develops its own checklist, designed for its own needs. Form G4-1 is representative of the type used by many lenders for a corporate borrower. A similar form would be adapted for a LLC or a Limited Partnership as a borrower. A comprehensive checklist is probably the most important tool in the loan documentation process. This Form is not to be confused with the “Closing Agenda” (see Form 13) which lists the documents to be executed and delivered by the parties prior to or at the Closing Date, which is prepared by lender’s counsel and circulated to all concerned. The Agenda will indicate the “person” responsible to prepare each document.

The checklist, which is deal specific, is completed by the lending officer, and a copy is usually given to the lender’s counsel, but never to the borrower’s counsel. However, it is useful for a borrower’s attorney to be familiar with the items that are considered by the lender in preparing the documentation. And borrower’s attorney should request that his or her client furnish a copy of any written document from the lender outlining the “deal,” even if it is not a formal commitment.

Checklist

Bank Officer in Charge:
Bank Officer Assisting:
BORROWER
Corporate Name Stated in Certificate of
Incorporation:
Address:
State of Incorporation:
Place of Business Stated in Certificate of
Incorporation:
Name of Officers to Execute
Documents:
Title:
Residence Address:
Name of Secretary or Asst. Secretary to Certify
Resolutions:
Title:
Residence Address:
Name of Attorney for Borrower:
Firm Name:
Name of Accountant for Borrower:
Firm Name:
List at end details if any others are participating or lending with Bank in this loan.
Estimated Date for Execution of Term Loan Agreement:
Estimated Lending Date or Dates:
LOAN
Amount of Loan From Bank: $
Term: Repayment:		MonthlyQuarterlyOther:

No. of Equal Installments: Amount of Each: $
Date of First Installment
Balloon or Odd Installment Date: Amount: $
Payments to be Made at: Office
Interest Rate: %360 Day Year: 365 Day Year:
Payable With Principal Installments:
Other:
Commitment Fee:
None:			Fixed Percentage of %
Percent for Each Period:		Other:
Prepayment:
Not Allowed: Allowed in Multiples of: $
On Principal Payment Dates: Other:
Apply to Installments in Inverse Order of Maturity:
Apply Other:
Premium on Prepayment:			No Yes
Amount of Prepayment Premium:
If Prepaid by Proceeds of Loans From Other Lenders:
Other:
Fixed Percentage: %
Percentage for Each Period:		% Per
Recapture Provisions:
None: Percentage Net Profits: After Taxes %
% of Net Profits Exceeding $After Taxes
Other:
Other
Comments:


CONDITIONS TO THE LOAN
	Directors resolutions authorizing transactions (certified copies).
	Opinion of borrower’s counsel that all action is binding and legal.
	All matters to be satisfactory to Bank’s
	counsel.
	Certificates of compliance at time of subsequent borrowings from Bank, if any.
Collateral: None
Equipment: Inventory: Notes: Insurance:
dCollateral Real Property Mtge.
Accounts: Securities: Details Attached:
Guarantor(s):
Name(s):
State of Incorporation: Relationship to Borrower:
Security For Guaranty:
Subordination of Other Debt:
Name(s) of Subordinator(s):
State of Incorporation:
Form of Subordination:
Other Conditions to the
Loan:


REPRESENTATIONS & WARRANTIES
Apply to: Borrower: Guarantors: Subsidiaries
	Valid corporate existence.
	Qualification to do business in all appropriate
	jurisdictions.
	Corporate power to transact business.
	Clear title to all assets except … (Attach list of
	exceptions).
	Power to borrow, execute agreement and note and other
	action.
	No lawsuits or investigations pending.
	No approval of others required for
	transactions.
	No violations of By laws, Court Orders, etc.
	No material change in assets since last audit
	DATED:
	No material change since last financial statement
	DATED:
	Income Taxes paid or provided for through fiscal year
	ENDING:
OTHERS:
USE OF PROCEEDS


AFFIRMATIVE COVENANTS
Apply to: Borrower: Guarantors: Subsidiaries
	Submit Unaudited Balance Sheet, Operating Statement and Surplus Reconciliation
within: days after end of period.
Consolidated Consolidating
Monthly: Quarterly: Semi-Annually: Annually:
	Submit Audited Balance Sheet, Operating Statement and Surplus Reconciliation
within: days after end of period.
Consolidated Consolidating
Monthly: Quarterly: Semi-Annually: Annually:
Prepared by:
Submit other data as follows:
Submit certificate of no event of default.
Executed by: Officer: Accountants:
Pay taxes.
Maintain insurance:
Fire and Theft: Liability & Workmen’s Compensation:
Loss Payee Clauses: Deliver Policies to Bank:
Inform the Bank of litigation:
All: Unless covered by Insurance. *
Maintain proper corporate existence.
Maintain working capital of at least $ or a current ratio
of
Maintain corporate management satisfactory to Bank.
Notice of any default under other Borrowings or Loan Agreement with
others.
OTHER:

NEGATIVE-COVENANTS
Apply to: Borrower: Guarantors: Subsidiaries
No Borrowings except from Bank and
Others—(Attach list).
Create or suffer any liens on its property EXCEPT
Contested Tax Liens
Purchase Money Security Interest for % of Purchase Price
Others—(Attach list).
Become a guarantor.
Sell or lease substantial portion of assets.
No dividends EXCEPT
No acquisition of Borrower’s capital stock EXCEPT
Enter leases ceiling for payments in excess OF $ PER YEAR
Make any investment or loan EXCEPT:
Deposits For Purchases
Obligations of the U.S.A.
Stock of Subsidiaries
Merge or consolidate
LIMIT ON SALARIES YES NO (Attach details)
LIMIT ON CAPITAL EXPENDITURES Yes No (Attach details)
OTHERS:
EVENTS OF DEFAULT
As in security agreement or As follows:
Apply to: Borrower: Guarantors: Subsidiaries
	Non-payment of the money borrowed hereunder:
	days grace: NONE: 10: 30: Other:
	Standard Bankruptcy and Insolvency events.
	Submitting false financial statements.
	Non-payment of any other indebtedness to the Bank.
	Failure to satisfy any judgment against Borrowers.
	Default in performing of any term of the agreement
	AFTER days notice of such default.
	Default under any other Borrowing or Loan Agreements with
	others.
OTHERS:
EXPENSES
	Bank’s out-of-pocket expenses in loaning and enforcing shall be paid by Borrower.
MISCELLANEOUS
	Bank shall not waive any right by failure or delay in exercising such right.
	No modification except in writing.
	Law of New York shall apply.
ADDRESSES TO WHICH NOTICES AND DEMANDS SHALL BE GIVEN:
Bank:
Borrower:
Other: