How to review a commercial loan agreement before sending it to counsel

Freeze the financing package and borrowing brief

Begin by inventorying the proposed loan agreement, note, term sheet, fee letter, payment schedule, authorizations, guarantees, security-related documents, certificates, and every exhibit or instruction included with the package. Record the filename, version, sender, received date, and internal owner for each item. Preserve the originals rather than replacing them with one assumed financing set.

Add a short borrowing brief written by the owner and finance lead. Record what the funds are expected to support, the planned timing, the amount the business expects, the operating assumptions behind repayment, the accounts or assets involved in administration, and the person authorized to approve a business change. Keep this brief labeled as business context so it cannot be mistaken for lender language.

• Name the exact agreement, note, schedule, and supporting-document versions under review.
• List every exhibit, certificate, instruction, or other item the package incorporates.
• Record the ownership, finance, operations, and administrative owners.
• Keep lender conversations and internal forecasts separate from source-backed terms.

Map every money event and date to its source

Create one table for each amount, calculation, payment event, date, notice, and condition the team expects to administer. Useful rows may include closing or funding, fees, payment timing, rate or amount calculations, account instructions, reporting dates, renewal or extension events, early repayment requests, and the end of the relationship. Capture the smallest useful source passage and its exact location for every contract-derived entry.

Keep internal modeling beside the source rather than inside it. Finance can record the revenue, cash-flow, production, or timing assumption used in the business plan while leaving the proposed agreement language intact. When a number depends on an unknown input or a date depends on another event, preserve that dependency instead of forcing it into a precise forecast.

• Separate a stated amount or formula from the business forecast.
• Record a fixed date differently from one triggered by another event.
• Name the person who can verify each payment or administrative assumption.
• Mark a missing schedule, definition, input, or instruction explicitly.

Connect operating commitments to verifiable records

Read the package for the business activities the team may need to monitor or document, such as financial reporting, budgets, insurance records, equipment or asset changes, additional borrowing, ownership changes, notices, and other ongoing information requests. Record only what appears in the proposed documents and attach every note to its source.

Then identify the record and owner that could verify each operating fact. Finance may own statements and forecasts, operations may own equipment or production records, and ownership may control capital and governance decisions. Counsel can inspect how those verified facts relate to the proposed language and identify the interpretation or drafting work still needed.

• Keep each proposed commitment beside the record the business would use to administer it.
• Name the record owner and the date the underlying fact was checked.
• Separate current business practice from a contract interpretation.
• Preserve an unavailable record or unclear owner as an open item.

Test the package against real financing scenarios

Walk through several plausible business events: the funding date moves, a planned equipment purchase changes, a customer payment arrives later than forecast, a requested report is not ready, the company considers another financing source, or the owner wants to repay or restructure earlier than planned. For each scenario, place the expected business response beside the source sections that appear relevant.

The walkthrough should reveal ownership and uncertainty rather than manufacture an answer. Finance can verify the model and records, operations can confirm production facts, ownership can make commercial choices, and counsel can address meaning, drafting, and legal risk. Keep any question open when the package or business record is incomplete.

• What financing or operating event is being tested?
• Which source passage appears to address it?
• Who can verify the business fact or approve a change?
• What interpretation or drafting judgment remains for counsel?

Give counsel one financing-event packet

The handoff should include the frozen document inventory, borrowing brief, source-linked money-and-date table, operating-record map, scenario questions, missing materials, and the owner of every open decision. Keep superseded drafts, forecasts, and informal explanations available but distinguish them from the package counsel is being asked to review.

For each uploaded contract document, CounselOS can preserve source-linked clause extracts, surface playbook deviations, capture questions beside the relevant finding, and export selected material in a review packet. The borrowing model and operating records remain human-reviewed business artifacts; CounselOS provides traceable contract evidence for the company and attorney making the next decisions.