News & Analysis as of

Collateral Borrowers

Akin Gump Strauss Hauer & Feld LLP

Demystifying the Out-of-Court Foreclosure Process

Mezzanine lenders looking to foreclose on their collateral have the advantage of being able to pursue remedies outside of court. But the process, which is described in the Uniform Commercial Code (UCC), is often ill...more

DLA Piper

Ensuring Positive Outcomes With Negative Pledges in Venture Lending

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A “negative pledge” on intellectual property is a common feature of venture lending transactions, but its implications can often be misunderstood. Some lenders may be surprised to discover that it does not always provide the...more

Cadwalader, Wickersham & Taft LLP

B(ack to School) September 2024 - Unlocking Liquidity With a Tranche B Facility

Liquidity solutions are a topic du jour in fund finance. With bank balance sheets somewhat restricted by macroeconomic concerns and risk-weighted asset regulations, fund finance borrowers and lenders have sought creative ways...more

Husch Blackwell LLP

Credit Risks Likely to Rise as 2024 Draws to a Close

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A strange confluence of geopolitical events, labor unrest, softening consumer demand, and supply-chain logistical issues could leave lumps of coal in the stockings of lenders this holiday season. The story begins in the Red...more

Balch & Bingham LLP

Alabama Enacts Uniform Commercial Receivership Act

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On May 15, 2024, Alabama became the thirteenth state to adopt a version of the Uniform Law Commission’s Uniform Commercial Real Estate Receiver Act (the “Act”). The Act seeks to bring more direction and clarity to...more

Cadwalader, Wickersham & Taft LLP

Different Yet Similar August 2024 - Borrowing Base/Coverage Ratio Approaches in Subscription Finance Facilities

The key component of any subscription credit facility is the underlying capital commitments that are pledged to secure the facility. Virtually every lender will require some level of over-collateralization – meaning, investor...more

Mayer Brown

NAV Credit Facilities: The Spectrum of Collateral Structures

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Executive Summary - Net Asset Value (“NAV”) credit facilities are a tool that borrowers may use to access financing based on the value of their underlying investment portfolio. The users of these facilities are generally...more

Farella Braun + Martel LLP

Does using patents as loan collateral still create standing issues?

Traditionally, the Federal Circuit had been very strict that a plaintiff must own all the rights to a patent to have standing to bring a lawsuit. But in a few recent cases, the Federal Circuit has become more generous in its...more

Proskauer Rose LLP

Understanding the Increasing Use of Holdco NAV Loan Structures

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While the market for NAV financings—loans to funds supported by the net asset value of their portfolios—grew in 2023 and continues to rapidly evolve, a consensus has developed around what is sometimes referred to as a “Holdco...more

Cadwalader, Wickersham & Taft LLP

Controlling Cash March 2024 - Cash Control Event: Lender and Borrower Considerations

Our readers have been blessed with wonderful Fund Finance Friday articles dealing with the maintenance of collateral accounts in 'When Deposits Don’t Travel with Loans', control over collateral accounts in 'Control or Control...more

Mayer Brown

Subscription Finance: Commingling Collateral Accounts

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For loans primarily secured by a cash flow stream, subscription facility lenders heavily depend on collateral accounts as a key element of the security package. In this Legal Update, we delve into why subscription facilities...more

ArentFox Schiff

Avoiding Collateral Damage: Taking the (Re)Pledge [Part III]

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This constitutes the third in a four-part series that discusses the practice of repledging (sometimes referred to as “rehypothecation”), how standard agreements allow for repledging, the treatment of repledging under current...more

Dechert LLP

Why Are We So Calm?

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This is just a short note, with little actual utility, but it’s about something that’s really bothering me.  Why are we so calm?  What has anesthetized us?...more

Dechert LLP

Welcome to the New Normal – Funny Times Revisited

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Several weeks ago, I wrote a commentary called Funny Times in which I bemoaned the complete lack of coherent data, making the process of predicting the course of interest rates, cap rates and transactional velocity over the...more

Sullivan & Worcester

Collateral Managers – Do you need them?

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In our webinar of 23 March 2023, Sam Fowler-Holmes and I looked at some common structures in trade finance. When discussing structuring warehouse financing, we mentioned that one key mitigator of risk in such structures...more

Nelson Mullins Riley & Scarborough LLP

The Not-So-Automatic Stay for Foreign Assets and Creditors

When a debtor files for bankruptcy, it’s axiomatic that all creditors, wherever located, must immediately cease their efforts to collect on debts owed to them by that debtor, right? Not necessarily so, says the United States...more

Miller Nash LLP

Why Does My Lender Want My Attorney to Send It an Opinion Letter?

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Although they have been around for many years, it is becoming more common for a commercial loan lender to require that the borrower’s counsel provide it with an opinion letter. At first blush, this may seem like an oddity:...more

Partridge Snow & Hahn LLP

Rhode Island Modernizes its Receivership Law By Enacting the Commercial Receivership Act

On June 20, 2022, Rhode Island Governor Daniel J. McKee signed into law the Rhode Island Commercial Receivership Act (“CRA”), which updates and modernizes Rhode Island receivership practice. Pub. L. 2002, ch. 107 and 108. The...more

Cadwalader, Wickersham & Taft LLP

The ESG Factor, January 2022 - One of These Things Is Not Like the Other: New York State Court Upholds Commercial Reasonableness...

On November 10, 2021, the owner of the State Street Financial Center in Boston, Massachusetts defaulted on its debt, consisting of a mortgage loan in the amount of $535,000,000 and three mezzanine loans in the aggregate...more

A&O Shearman

The Scope of Article 8 Mandatory Choice-of-Law Rule

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The scope of the mandatory choice-of-law rule set forth in Uniform Commercial Code (UCC) section 8-110(a)(1), which provides that “the local law of the issuer’s jurisdiction . . . governs . . . the validity of a security,” is...more

Kaufman & Canoles

Commercial Real Estate Receiverships: The Closing of the Action and Miscellaneous Matters

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The sale order should require that the receiver file an accounting of its activities as receiver within so many days of the sale of the property. Once that has been filed, the secured lenders counsel can file a motion to...more

Lowenstein Sandler LLP

Get Ready For Loan Enforcement

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The pandemic has hurt many companies. Fortunately, at the urging of the Federal government and with relief from regulators, many secured lenders have refrained from taking action against borrowers in default under the terms...more

Amundsen Davis LLC

Cross Collateralization Generally Not Created By Note Alone

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From time to time, we review loan files for clients to confirm they have the collateral they think they do. Assume a lender has a properly perfected $1,000,000 mortgage loan and a $500,000 line of credit secured by all of the...more

Miller & Martin PLLC

Loss Mitigation Strategies for Commercial Creditors

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It seems that every few years, we experience an unprecedented event that significantly affects the world. From a once-in-a-generation recession to a once-in-a-century pandemic, trade creditors and inventory lenders constantly...more

Proskauer Rose LLP

Private Credit Lenders – Navigating Successor Liability Issues

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The primary investment thesis of a private credit lender is simple — get the loan repaid at maturity. Private credit lenders do not make loans as a means to acquire their borrower’s business. There are circumstances, however,...more

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