The Post-Revlon Reaction: Pitfalls for Lenders in the Propos

The Post-Revlon Reaction: Pitfalls for Lenders in the Proposed Erroneous Payment Language | Akin Gump Strauss Hauer & Feld LLP


To address the key issue in the litigation
In re: Citibank August 11, 2020 Wire Transfers
1, on March 19, 2021, the Loan Syndication and Trading Association (LSTA) circulated a Market Advisory
2 that contains draft erroneous payment language to be incorporated into credit agreements that purports to protect administrative agents and contractually entitles administrative agents to claw-back erroneous payments in the future.
Importantly, the LSTA language grants administrative agents sole discretion to determine whether a payment was made erroneously. In addition to that fundamental grant of discretion, the LSTA language also provides for recovery of erroneous payments by administrative agents, states that a notice of an erroneous payment from an administrative agent to a lender is conclusive absent manifest error, and creates a presumption that any payment that is received by a lender that differs from the scheduled amount or that does not match the amount set forth in a prepayment notice was made in error and must be returned to the administrative agent.

Related Keywords

, Citibank , Akin Gump Strauss Hauer Feld , Trading Association , Loan Syndications Trading Association , Akin Gump Strauss Hauer , Citibank August , Loan Syndication , Erroneous Payment Provision , Loan Syndications , சிட்டி வங்கி , வர்த்தக சங்கம் , சிட்டி வங்கி ஆகஸ்ட் , கடன் சிண்டிகேஷன் ,

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