SunGard Provision Clause (Commitment Letter)

Summary

This clause is a SunGard provision for commitment letters in acquisition financings in Canada. SunGard clauses are used to curtail conditionality to the funding of the loan so that the seller has more certainty that the borrower will have adequate funds to close the acquisition. This precedent contains the language typically included in these clauses. This clause includes practical guidance and drafting notes. SunGard clauses are named after the 2005 acquisition of SunGard Data Systems Inc. SunGard provisions were developed in the United States and are found in sponsor-led acquisition financings. In Canada, commitments to finance large acquisitions increasingly contain SunGard provisions or conditions. The purpose of this clause is to curtail conditionality to the funding of the loan so there is more certainty for the seller that the borrower will have adequate sources of funds to close the acquisition. This precedent is for Canadian dollar denominated loans under the CBCA, OBCA, ABCA,...