PLI - Asset Based Financing Strategies 2016

Asset based financing is a key source of credit for small and medium-size companies and for some larger, publicly traded companies as well. In contrast to equity financing where ownership in the company is diluted, asset-based financing allows companies to borrow funds against their own assets as collateral to generate cash for working capital and capital acquisitions.

In structuring these loans, lenders rely on their collateral as their ultimate source of payment.  Accordingly, lenders and their counsel must consider all senior interests in the collateral, as well as the practical difficulties in obtaining payment in enforcement situations. Not only is a sound knowledge of the law required, but also practical knowledge of the common drafting and enforcement issues likely to arise.

At this program, our expert faculty will explore the most common forms of asset-based financing, and the legal rules governing them, with particular emphasis on Article 9 of the Uniform Commercial Code, as most recently amended, and the Bankruptcy Code. In addition, the faculty will share what they have learned in representing secured creditors and borrowers in structuring asset-based loans and in enforcing them inside and outside of bankruptcy. The faculty will also discuss a number of ethical issues that arise in asset-based financings.

What You Will Learn

• Brief review of the basic rules for attachment, perfection, priority and enforcement of a security interest under Article 9

• Common asset-based financing structures

• Techniques for equipment, inventory and receivables financing

• Priority issues relating to non-UCC liens and intercreditor arrangements

• Strategies for structuring an inventory and receivables borrowing base

• Enforcement and bankruptcy planning strategies

• Trends in debtor in possession asset-based financing

• Non-uniform provisions under the New York UCC relevant to asset-based lending

• Cross-border asset based financing issues