Glossary of acquisition finance terms and jargon

The following Banking & Finance practice note provides comprehensive and up to date legal information covering:

  • Glossary of acquisition finance terms and jargon
  • Acquisition finance glossary—A
  • Acceleration
  • Accordion feature/accordion facility
  • Agreement among lenders (AAL)
  • Amortise/amortisation
  • Ancillary facilities
  • Acquisition finance glossary—B
  • Basket
  • Bidco
  • More...

Glossary of acquisition finance terms and jargon

This glossary explains many of the terms commonly used in the leveraged finance market. Terms contained in the definitions themselves that are in bold are defined elsewhere in the glossary.

Please refer to the main Banking & Finance Glossary for additional banking terms.

Acquisition finance glossary—A

Acceleration

Acceleration refers to the taking of a formal step by the agent on the instructions of the majority lenders following an event of default such as demand for early repayment of the loan.

See Practice Note: Events of default for more information.

Accordion feature/accordion facility

An accordion, or incremental debt feature, refers to a mechanism in the facilities agreement under which, provided certain conditions are met such as pro forma compliance with a leverage test, lenders under the facilities agreement who wish to do so can lend additional debt. The terms of the additional debt will typically be documented in an increase notice. An accordion or incremental debt flexibility should be distinguished from structural adjustment which typically requires the majority consent of the syndicate. Borrowing under the incremental facility mechanism only requires consent from participating lenders (provided the conditions set out in the facilities agreement are met).

For more information, see Practice Note: Incremental debt flexibility or accordion features.

Agreement among lenders (AAL)

An agreement among lenders is a common feature in the US unitranche market and refers to the

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