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Sponsored by Lorman Education
Product ID: 409096EAU
 
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Potential Pitfalls in Borrowing Base Transactions

OnDemand Webinar (94 minutes)

Understand the basics of ABL credit agreements and the best practices for compliance.When negotiating a credit agreement, several factors, including the borrower's risk profile and credit ratings, impact the breadth of the affirmative, negative, and financial covenants imposed on the borrower. However, some of the most burdensome credit agreements are asset-based lending (ABL) credit agreements. The heart and soul of ABL lending is the collateral, and thus, ABL credit agreements often provide for intense lender monitoring and supervision because the borrowing base is tied to eligible assets. Under such a strict regime and without good advice from counsel, it is not uncommon for borrowers to trip an unintended default. This topic will highlight the basics of ABL credit agreements, including common provisions and pitfalls, and provide lawyers and treasury professionals with specific areas on which to focus review during negotiations. This information will also help ensure that the persons responsible for administering ABL credit facilities understand best practices for compliance with their complex provisions.

Authors

Kimberly MacLeod, Hunton Andrews Kurth LLP Hillary Patterson, Hunton Andrews Kurth LLP

Agenda

Discuss Typical Asset-Based Lending Credit Agreement Provisions and Term Sheet Considerations

• Where to Focus Review of Term Sheets and Credit Agreements

• Typical Definitions, Representations, Covenants and Events of Default

• Other Negotiating Points

Formulate Best Practices Pre- and Post-Closing to Avoid Defaults

• Credit Agreement Negotiation

• Credit Agreement Administration

Defaults

• Avoiding Defaults

• Approach If Default Occurs or Is Forecasted

• A Word on Technical Defaults

Frequent Compliance Inquiries