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Bridge Loan Term Sheet for the United Kingdom

Bridge Loan Term Sheet Template for England and Wales

A Bridge Loan Term Sheet Template under English and Welsh law is a preliminary document outlining the key terms and conditions of a short-term financing arrangement. It serves as the foundation for the subsequent loan agreement, detailing essential elements such as loan amount, interest rate, repayment terms, and security requirements. While not typically legally binding (except for certain provisions), it represents the parties' intentions and forms the basis for detailed documentation.

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Bridge Loan Term Sheet

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What is a Bridge Loan Term Sheet?

The Bridge Loan Term Sheet Template is essential for situations requiring rapid, interim financing before permanent funding becomes available. Used extensively in real estate, corporate acquisitions, and project financing under English and Welsh law, this document captures critical commercial terms, conditions, and requirements for bridge financing. It serves as a roadmap for legal documentation and typically includes facility details, pricing, security arrangements, and key conditions. The template is designed to expedite negotiations while ensuring all crucial elements of the bridge facility are properly addressed.

What sections should be included in a Bridge Loan Term Sheet?

1. Parties: Identification of lender and borrower with full legal names and registration details

2. Background: Purpose of the bridge loan, context and transaction overview

3. Facility Details: Key terms including amount, purpose, availability period and facility type

4. Interest and Fees: Interest rate, calculation method, arrangement fees, commitment fees and other charges

5. Repayment Terms: Maturity date, repayment schedule, prepayment provisions and exit mechanisms

6. Security: Details of collateral, guarantees and security arrangements

What sections are optional to include in a Bridge Loan Term Sheet?

1. Conditions Precedent: Pre-drawdown conditions and required documentation, used for complex transactions

2. Covenants: Financial and operational commitments, typically used for larger facilities or higher-risk borrowers

3. Events of Default: Circumstances triggering default and acceleration, used for higher-risk loans or sophisticated transactions

4. Representations and Warranties: Borrower statements and assurances, used for sophisticated borrowers or complex transactions

What schedules should be included in a Bridge Loan Term Sheet?

1. Form of Drawdown Notice: Standard template for requesting loan disbursement

2. Security Details Schedule: Comprehensive description of security arrangements and asset details

3. Fee Schedule: Detailed breakdown of all applicable fees, charges and their calculation methods

4. Conditions Precedent Documents: Checklist of required documentation and conditions to be satisfied before drawdown

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

England and Wales

Publisher

Ƶ

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions





































Clauses






























Industries

Financial Services and Markets Act 2000: Primary legislation that regulates financial services and markets in the UK, establishing the regulatory framework for lending activities

Consumer Credit Act 1974: Governs consumer credit agreements and provides consumer protection measures, relevant if the borrower could potentially be a consumer rather than a business

Companies Act 2006: Regulates corporate borrower's capacity to borrow and establishes directors' duties and corporate authority requirements

FCA/PRA Regulations: Financial Conduct Authority and Prudential Regulation Authority requirements, particularly relevant if the lender is a regulated entity

FSMA Regulated Activities Order 2001: Defines and specifies which lending activities are regulated under UK law

Common Law of Contract: Establishes principles of contract formation, interpretation rules, and remedies for breach under English law

Unfair Contract Terms Act 1977: Governs the reasonableness of contractual terms and limitations of liability in commercial contracts

Money Laundering Regulations 2017: Sets out KYC requirements and due diligence obligations for financial transactions

UK Sanctions Regulations: Establishes compliance requirements with sanctions regime and restricted parties screening

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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