Rollover loan meaning

This glossary sets out many of the expressions commonly used in the leveraged finance market. Words appearing in the definitions in bold are defined elsewhere in this glossary. For further banking terminology, please refer to the main Banking & Finance Glossary... Acquisition finance glossary—A Acceleration Acceleration is the formal action taken by the agent, on the instructions of the majority lenders, following an event of default, such as making a demand for early repayment of the loan. See Practice Note: Accelerating a loan for more information... Accordion feature/accordion facility An accordion, also called an incremental debt feature, is a mechanism in the facilities agreement that, provided specified conditions are satisfied (for example, pro forma compliance with a leverage test), permits those lenders under the facilities agreement who wish to do so to advance additional debt. The terms for that extra debt are typically captured in an increase notice. This accordion or incremental debt flexibility is different from structural adjustment, which usually requires the majority consent...

Both a straightforward Murabaha and a commodity Murabaha can be arranged either for a one-off deal or set up as a revolving facility, allowing multiple deals to be undertaken under a single umbrella. In each case, the documentation sets out the core mechanics for entering into transactions. For revolving arrangements, however, the customer (the Customer) and the financier (an Islamic financial institution (IFI)) typically conclude a master agreement, which governs the fundamental terms of their subsequent dealings, while the specifics for any particular trade are confirmed at the point of execution. In look and effect, this echoes familiar conventional products, including the revolving loan facility and the note purchase facility. Across these structures, a customer may seek a transaction (whether a sale transaction, a loan, or a note issuance, as applicable) by reference to the baseline terms in the underlying master agreement, with adjustments for each draw based on amount, timing, rate, and similar variables. A finance provider may participate indirectly in a Murabaha facility by employing conventional loan documentation...

This Practice Note This Practice Note serves as a primer on the facilities commonly included in a leveraged senior facilities agreement (SFA) and considers: the key attributes of each category of senior facility the types of senior lenders typically involved how the terms of the senior facilities are documented the security package and intercreditor position for senior facilities For an introductory overview of acquisition and leveraged finance, see Practice Note: Introductory guide to acquisition finance. For fuller detail on standard terms for senior facilities, see Practice Note: Introductory guide to leveraged finance facilities agreements. Definitions for many of the expressions used in this Practice Note are set out in the Glossary of acquisition finance terms and jargon...