ARTICLE · 29 MAY 2023

Sustainability-Linked Loans: LMA Publishes Model Provisions

Arthur Cox

The LMA published its long-awaited model provisions for sustainability-linked loans (SLLs) earlier this month. This was preceded by updates to both the SLL Principles and the Guidance on the SLL Principles (Guidance) by the LMA...

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Arthur Cox

Imelda Shiels

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The LMA published its long-awaited model provisions for sustainability-linked loans (SLLs) earlier this month. This was preceded by updates to both the SLL Principles and the Guidance on the SLL Principles (Guidance) by the LMA (in conjunction with the LSTA and APLMA) in February 2023.

The model provisions (available in the members' area of the LMA's website) are accompanied by detailed drafted notes and are designed as a starting point. They have been drafted by reference to the LMA's model Leveraged Facilities Agreement (as that model contemplates a margin rachet) and can be adapted for use with other LMA model facility agreements.

The expectation is that the model provisions will be tailored to the specifics of each transaction and will be further refined over time as market practice evolves.

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This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.

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