A tranche is a distinct part of a financing transaction with its own terms, as defined in the common financing agreement.  Leveraged facility agreements commonly comprise multiple tranches of term loans with different maturity profiles and commonly different optional currencies and a revolving credit facility, each with its own margin.  In structured finance, tranches are also referred to as "facilities".

"Facility" means a Term Facility or the Revolving Facility.

The LMA recommended form of primary market documentation for investment grade borrowers allows for both term loan and revolving credit facilities.  LMA template leveraged finance agreements foresee use of three senior term facilities and a senior revolving facility.  LMA real estate finance (REF) facility documents provide for only single-currency fixed term loans with a fixed or a floating rate of interest and no revolving facilities.

“Term Loan” means a Facility A Loan, a Facility B Loan or a Facility C Loan.

The different layers of the finance structure are syndicated to different investor groups. Where revolving and amortizing tranches are placed with banks because of their amortization and tighter covenants, the higher yielding debt commonly comprising the greater part of leveraged finance is typically taken up by institutional investors, who are generally comfortable with the loose covenant package of the higher yielding loans.

"Revolving Facility" means the revolving credit facility made available under this Agreement as described in paragraph (a)(iv) of Clause 2.1 (The Facilities).

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