Abstract
The loan agreement contains representations which are required to be made on the date of the agreement. It also often contains representations which are required to be made on other dates (typically, on each drawing and on the first day of each Interest Period). The purpose of the representations is:
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in the case of representations required to be made on the date of the agreement, to trigger disclosure of information; and
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in all cases, to give the lenders the contractual right not to advance additional monies (i.e. to act as a drawstop) and/or to accelerate the loan if the specified statements are untrue on the date they are made.
There may also be liability in misrepresentation (as opposed to liability in contract) for the borrower if the statement is untrue.
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© 2014 Sue Wright
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Wright, S. (2014). Representations, Undertakings and Events of Default. In: The Handbook of International Loan Documentation. Global Financial Markets. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-137-38337-2_9
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DOI: https://doi.org/10.1007/978-1-137-38337-2_9
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-137-46758-4
Online ISBN: 978-1-137-38337-2
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