Looking at a provision in a combined debt/equity term sheet from an investor for an acquisition we are raising for that says: "Borrower shall be responsible for filing fees, closing costs, and Lender’s reasonable attorney fees in connection with its due diligence and documentation."
Haven't seen this before. Is this the norm? At first glance feels a little odd that the borrower would pay attorney fees for an investor.
Provision in Investor Term Sheet re Borrower Responsibility for Fees
by a searcher from Columbia University
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Second, it is also typical for institutional equity investors to have their reasonable legal fees for a transaction paid by the "company". As Brian mentioned, the funds provided by the investor will be used to pay the fees. The equity investor wants to maximize their ownership position in the company. Having the legal fees paid by the company using the funds provided by the investor results in a larger ownership position compared with the alternative of the investor paying the legal fees directly.