A short document including a list of key documentation terms related to a debt financing.
The financing grid is often used by private equity sponsors as a way of pre-agreeing certain key terms with lenders in the early stages of the debt raising process, with the ultimate goal of expediting the drafting and negotiation of long-form credit documentation.
By utilizing a (financing) grid, parties involved in debt financing can more efficiently manage negotiations, compare offers from multiple lenders, and streamline the overall financing process.
A financing grid is typically presented in a table format, often in an Excel or Word document, however in recent years the industry has moved towards more modern technology and grids are now also part of digital platforms like Termgrid, which digitize the documents for easier negotiation, analysis, and comparison.
A financing grid includes detailed information on loan terms such as:
- Type and amount of financing
- Interest rates and margins
- Repayment structure
- Covenants and conditions
- Security arrangements
- Fees and other costs
- Legal clauses and specific language
Also known as: Term Grid, Summary Terms; Heads of Terms, (Summary) Termsheet