TELESEMINAR: Asset Based Finance, Part 1 – A National Perspective
July 8, 2014
12:00 – 1:00 p.m.
1.00 MCLE hours
Business loans generally come in two varieties – loans based on a company’s cash flow and loans based its tangible or intangible assets. With credit still tight, many companies often turn to asset-based finance to fund their operations and expansion. Credit is based on the company’s inventory, receivables, equipment or chattel paper on a term or revolving basis. Each type of collateral and loan structure has its unique drafting nuances that can help or hinder the company. This program will provide you with a practical guide to structuring asset-based loans based on inventory, receivables, equipment and chattel paper loans; understanding term and revolving loans structures; and enforcement issues and special considerations in bankruptcy. Part 1 of 2.
- Asset v. cash flow borrowing – and how it impacts reps, warranties and covenants in loan documents
- Overlay of UCC Article 9 law and practice on asset-based finance
- Types of loans – revolving loans based on inventory and receivables, terms loans based on equipment, and chattel paper financing
- Structures – bilateral v. syndicated loans, letter of credit facilities, second liens, inter-creditor agreements
- Compensation to lender – review of range of fees
Edwin E. Smith, Bingham McCutchen, LLP, Massachusetts
Steven O. Weise, Proskauer Rose, LLP, California