When negotiating a loan portfolio transaction (whether for performing or non-performing loans), it is crucial at the outset of the negotiation that the potential seller and the bidders/ potential buyers agree on the transaction’s general terms and conditions. Such agreements are typically contained in a term sheet, which outlines the material terms agreed to by the parties. In Germany, however, there are a lack of form term sheets that help the parties understand the types of cornerstone issues they should consider. To help address this deficiency, Mayer Brown, as one of the founding members of, and counsel for, Deutsche Kreditmarkt-Standards e.V., recently drafted a form term sheet to be used in managing the expectations of the parties in relation to the transaction in question.

Used in conjunction with our Servicing Agreement, Sale and Purchase Agreement, Confidentiality Agreement and Date Sheet forms, this form should enable German banks and investors to prepare and process transactions in the loan market. We are glad to share this term sheet with you and will keep you posted on further developments. German and English language versions are attached to this Legal Update.

For more information about this term sheet, please contact Dr. Jörg Wulfken at +49 69 79 41 2951 or Dr. Simon Grieser at +49 69 7941 2751.