Tips and traps—key issues in negotiating engagement letters, release and reliance letters
Produced in partnership with Oliver Hensby of RBS

The following Banking & Finance practice note produced in partnership with Oliver Hensby of RBS provides comprehensive and up to date legal information covering:

  • Tips and traps—key issues in negotiating engagement letters, release and reliance letters
  • When are such letters required and for what type of transactions?
  • The underpinning approach to the obligations contained in each type of letter
  • Main topics of negotiation
  • Release and hold-harmless letters
  • Signing entity
  • Addressees
  • Permitted Disclosure
  • Notification of disclosure
  • Indemnities and responsibility
  • More...

Tips and traps—key issues in negotiating engagement letters, release and reliance letters

IP COMPLETION DAY: 11pm (GMT) on 31 December 2020 marks the end of the Brexit transition/implementation period entered into following the UK’s withdrawal from the EU. At this point in time (referred to in UK law as ‘IP completion day’), key transitional arrangements come to an end and significant changes begin to take effect across the UK’s legal regime. This document contains guidance on subjects impacted by these changes. Before continuing your research, see Practice Note: What does IP completion day mean for lending lawyers? [Archived].

It is very common for engagement letters, release letters and reliance letters to be signed between parties when no external counsel has yet been appointed. Even if external counsel is appointed, it is common for such letters to fall outside of their scope of work. As such the onus will fall on the in-house counsel to review and negotiate these. This Practice Note is intended to provide tips, guidance and highlight potential issues to in-house counsel working on lending transactions who are involved in reviewing and negotiating such letters.

When are such letters required and for what type of transactions?

Each type of letter has a different aim:

  1. release letters or hold harmless letters give access to reports on various aspects of the potential borrower’s business or market; they are

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