Jurisdiction(s):
United Kingdom

Key definition

Bilateral facility agreement definition

What does Bilateral facility agreement mean? A bilateral facility agreement is the loan agreement documenting a credit facility provided by a single lender to a single borrower (often with group guarantors). It is a market term, not defined in legislation or case law, and is used consistently across England and Wales, Scotland, Northern Ireland and Ireland. Typically based on Loan Market Association (LMA) style documents adapted for one‑lender deals, it sets out the facility type and amount (for example, term loan or revolving credit facility), pricing and margin, drawdown mechanics, representations, undertakings (covenants), conditions precedent, events of default and, where relevant, security and guarantees....

Precedent non-binding letter of comfort for a bilateral facility agreement: parent or shareholder present intention to support borrower; no legally binding obligations

Published by a LexisNexis Banking & Finance expert

Precedents

[ On headed notepaper of comfort letter provider ]

To: [ insert the full name and address of the Lender ]

[ insert date ]

Dear [ insert full name of lender ]

Facility Agreement dated [ insert date ] (the Facility Agreement) between [ insert name of Borrower ] (the Borrower) and [ insert name of lender ] (the Lender)

We refer to the Facility Agreement and set out below our confirmations:

[ The Borrower is a company wholly owned by us. OR We beneficially hold [ insert percentage ] per cent of the Borrower’s issued share capital. ]
Our current policy is to see that the Borrower has sufficient [ financial ] resources to discharge its obligations as they fall due.
The statement at paragraph 2 represents a present intention offered for comfort only. It is neither intended to be, nor should it be interpreted as, a commitment regarding future conduct. [ We are under no duty to notify you of any subsequent policy changes. ]
This letter is not intended to create any legally binding obligations on us [ or on any of our subsidiaries ].

Yours faithfully

……………………………………

for and on behalf of [ insert name of comfort letter provider ]...

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Web page updated on 22/05/2026

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