Asset-Based Lending: Navigating Borrowing Base, Article 9 Collateral Issues, and Key Loan Documentation Provisions

This CLE webinar will discuss the mechanisms of asset-based financing transactions, including issues associated with the borrowing base, obtaining and perfecting a security interest in the assets as collateral under the UCC, and key terms in ABL loan documentation.

Description

In asset-based financing transactions, the lender lends up to a percentage of the value of the borrower’s assets—the borrowing base. Assets used in ABL financing are typically cash, accounts receivables, inventory and equipment.

ABL lending generally involves a higher degree of risk than other types of commercial lending. As a result, ABL loans require more intensive controls and supervision by the lender and have many unique features.

Listen as our authoritative panel of finance attorneys reviews the mechanisms of asset-based financing transactions, discusses key issues associated with different assets in the borrowing base, obtaining and perfecting a security interest in the assets, and key terms in ABL loan documentation.

Outline

• Types of ABL facilities
• Borrowing base
• Cash
• Accounts receivables
• Inventory
• Equipment
• Real estate
• Obtaining and perfecting a security interest in assets under UCC Article 9
• Loan documentation
• Representations and covenants
• Reserves and dilution
• Conditions precedent
• Cash management (deposit control account agreements and lock boxes)
• Subordination/intercreditor agreements
  

Benefits

The panel will review these and other key issues:

Key issues with different assets in the borrowing base
Obtaining and perfecting a security interest in the assets under UCC Article 9
Cash management provisions and deposit account control agreement in ABL loan documentation
Subordination and intercreditor agreements in ABL loan documents

Faculty

Harvey C. Guberman, Partner
Ballon Stoll Bader & Nadler, New York
Mr. Guberman focuses on asset based lending, factoring, financing and creditors rights. His prior experience includes Assistant GC of the Commercial Funding Division of Bank of America Commercial Corp. and GC to the factoring division of The CIT Group. He is a frequent lecturer on commercial law topics and has written and spoken extensively about secured lending and international and domestic factoring.

Paul B. Hahn, Partner
Platzer, Swergold, Levine, Goldberg, Katz & Jaslow, New York
Mr. Hahn represents large multi-national to midsized and small commercial finance, banking and factoring institutions in the structuring, documentation, workout and restructuring of commercial finance, asset-based lending, factoring, equipment leasing, and licensing transactions, including syndicated and international transactions. He has also represented corporate borrowers in such transactions.

Scott A. Lessne, Senior Counsel
Crowell & Moring, Washington, D.C.
Mr. Lessne's practice involves the representation of financial institutions and corporate clients in connection with the negotiation and documentation of commercial, asset-based, project-related, and real estate loan transactions, as well as advising clients on legal issues arising in complex single and multi-lender loan workouts and restructures. He also advises financial institution clients on creditors' rights remedies including judicial and non-judicial enforcement actions and bankruptcy strategies.

Jenny E. Cieplak, Counsel
Crowell & Moring, Washington, D.C.
Ms. Cieplak practice primarily involves mergers and acquisitions, complex joint ventures, consortiums and strategic alliances, venture capital and private equity investments, and corporate finance. She is experienced in drafting a wide range of commercial agreements. Her practice focuses on the financial services industry, working on the creation, governance and sale of electronic trading platforms, exchanges, swap execution facilities, clearinghouses, and data repositories. She also advises clients on commodities law.