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Fee Letter Syndicated Loan for the United States

Fee Letter Syndicated Loan Template for United States

A Fee Letter for a Syndicated Loan is a formal document under U.S. law that outlines the various fees payable in connection with a syndicated loan facility. It details arrangement fees, commitment fees, agency fees, and other charges payable by the borrower to the arrangers, agents, and lenders. The document complements the main facility agreement and is governed by U.S. federal and state banking regulations, including requirements from regulatory bodies such as the Federal Reserve and OCC.

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What is a Fee Letter Syndicated Loan?

The Fee Letter Syndicated Loan document is a crucial component of syndicated lending transactions in the United States. It is used whenever a syndicated loan facility is established and serves to document the commercial agreement between parties regarding fees. This document typically accompanies the main facility agreement and outlines all fee arrangements, including upfront fees, ongoing charges, and success fees. Under U.S. jurisdiction, it must comply with federal banking regulations, state usury laws, and relevant regulatory requirements. The letter is particularly important for transparency and regulatory compliance, providing clear documentation of all fee arrangements between the borrower and the lending syndicate.

What sections should be included in a Fee Letter Syndicated Loan?

1. Fee Structure: Detailed breakdown of all applicable fees including arrangement fees, commitment fees, and agency fees

2. Payment Terms: Timing and method of fee payments, including whether fees are payable in advance or arrears

3. Calculation Methodology: How fees are calculated, including any relevant percentages or fixed amounts

4. Fee Conditions: Any conditions precedent to fee payment or circumstances affecting fee amounts

5. Reference to Main Facility: Cross-reference to the main syndicated facility agreement

What sections are optional to include in a Fee Letter Syndicated Loan?

1. Success Fees: Additional fees payable upon achieving specific milestones or conditions - include when deal includes performance-based compensation

2. Market Flex Provisions: Terms allowing adjustment of fees based on market conditions - include in challenging market conditions or complex syndications

3. Currency Provisions: Specifications for fees in multiple currencies - include for multi-currency facilities

What schedules should be included in a Fee Letter Syndicated Loan?

1. Fee Schedule: Detailed breakdown of fee amounts and calculation methods

2. Payment Schedule: Timeline of when different fees become due

3. Bank Account Details: Payment instructions and account information for fee payments

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

United States

Publisher

Ƶ

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Clauses























Industries

Truth in Lending Act (TILA): Federal law that requires lenders to provide standardized disclosures about terms and costs associated with lending to promote informed consumer decision-making

Equal Credit Opportunity Act (ECOA): Federal law prohibiting discrimination in lending practices based on race, color, religion, national origin, sex, marital status, age, or source of income

Bank Secrecy Act (BSA): Federal law requiring financial institutions to assist government agencies in detecting and preventing money laundering

Dodd-Frank Act: Comprehensive financial reform legislation that introduced new regulatory requirements for financial institutions and enhanced consumer protection

Securities Acts: The Securities Act of 1933 and Securities Exchange Act of 1934 may apply if the syndicated loan could be classified as a security

State Usury Laws: State-specific regulations that set maximum interest rates and govern lending practices within individual states

UCC Provisions: Uniform Commercial Code provisions governing commercial transactions, including secured lending across different states

LSTA Guidelines: Loan Syndications and Trading Association standards and best practices for syndicated loan documentation and trading

BSA/AML Requirements: Bank Secrecy Act and Anti-Money Laundering compliance requirements for financial institutions participating in syndicated lending

FATCA Compliance: Foreign Account Tax Compliance Act requirements affecting cross-border aspects of syndicated loans

Federal Reserve Regulations: Various Federal Reserve regulations affecting bank lending, including margin requirements and capital adequacy standards

State Banking Regulations: State-specific requirements governing banking operations and lending practices within individual jurisdictions

CFPB Guidelines: Consumer Financial Protection Bureau guidelines ensuring consumer protection in financial transactions and lending practices

Teams

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