After the end of the operational phase, the facility would need to remain in place with a lighter structure to manage the portfolio and receive the repayments for loans and equity.

However, waiving default clauses under existing facilities (as was confirmed by the Royal Mail half-year regulatory accounts (8), at note 3 on page 18 ‘Royal Mail Group plc has net liabilities as at 24 September 2006, primarily as a result of the pension deficit within its main pension plan, the Royal Mail Pension Plan. Consequently, Royal Mail is in breach of its borrowing facilities with Government, but has received formal waivers from the Department of Trade and Industry, in its capacity as lender’) and granting additional loan finance was something a commercial party would not under normal circumstances do.

Also, a tendency has been reported on the part of lenders in corporate loan transactions to institute proceedings pre-maturely so as to ensure the jurisdiction of the court designated in the agreement, with the negative economic consequences this has in terms of triggering default and cross-default clauses in loan agreements.

6. The Bank shall protect itself against exchange risks by including in contracts for loans and guarantees such clauses as it considers appropriate.

the loan agreement shall not include any clause providing that in specified circumstances, other than the winding-up of the reinsurance undertaking, the debt will become repayable before the agreed repayment dates.

the loan agreement must not include any clause providing that in specified circumstances, other than the winding-up of the assurance undertaking, the debt will become repayable before the agreed repayment dates.