TreatiseTreatise

Asset-Based Lending: A Practical Guide to Secured Financing
(7th Edition)

 by John F Hilson
 
 Copyright: 2011-2014
 Last Updated: August 2014

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Product Details

  • ISBN Number: 9781402416408
  • Page Count: 1250
  • Number of Volumes: 1
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"[Asset-Based Lending] is a polished gem that deftly brings into focus the major issues.”
 — The Secured Lender

For 20 years, Asset-Based Lending: A Practical Guide to Secured Financing has been a model of clear, sensible, step-by-step coverage of the techniques, documents, risks, and protections at the heart of this complex specialty.

This is the Seventh Edition of Asset-Based Lending: A Practical Guide to Secured Financing and it includes many new and updated segments.  The changes that have been made include updates relative to: goods that are subject to certificates of title; the UCP and ISP98 rules that govern letters of credit; the Empressas Cablevision case; the ABA’s Model Intercreditor Agreement; fraudulent transfer issues in leveraged buyouts; recent case law concerning PACA and the distinction under PACA between a secured lender with a security interest in the receivables of a debtor and a factor that has purchased the receivables; the issue of “gifting" under chapter 11 plans of reorganization and the decision in the DBSD case, and the issue of the right of a secured creditor to credit bid in the context of a chapter 11 plan of reorganization; letters of intent as well as legal and market developments relative to commitment letters; legal developments that lenders should take into consideration; identifying those proposed revisions to Article 9 that are most relevant to asset-based lending; and to DIP financing, including forms of interim and final orders.

Asset-Based Lending also guides you on how to accurately assess a borrower’s solvency before initiating a deal; plan for bankruptcy risks when analyzing secured loans; resolve conflicts between lead lenders and loan participants; and reduce lenders’ liability exposure to environmental, securities, and tax laws.

Updated at least once a year, Asset-Based Lending: A Practical Guide to Secured Financing is an important tool for every attorney, executive, business professional, and public official involved in secured financing.

  Preface and Acknowledgments
  Table of Contents
Chapter 1: Accounts Receivable Financing; and Appendix 1A
  • § 1:1 : Introduction1-2
    • § 1:1.1 : Commercial Finance1-3
    • § 1:1.2 : Bank Financing Transactions1-3
  • § 1:2 : Receivable Types1-4
    • § 1:2.1 : Conventional Receivables1-4
      • [A] : Characteristics1-5
      • [B] : Other Considerations1-7
    • § 1:2.2 : Secured Receivables1-8
      • [A] : Contractual Security Interests1-8
      • [B] : Statutory Liens1-9
      • [C] : Letter-of-Credit Security1-10
    • § 1:2.3 : Unbilled Receivables1-12
    • § 1:2.4 : Consignment Sales1-13
    • § 1:2.5 : Government Receivables1-14
    • § 1:2.6 : Healthcare Receivables Financing1-18
      • [A] : Medicare and Medicaid: Overview1-19
      • [B] : Legislation to Curb Perceived Abuses1-19
      • [C] : Narrowing of the Limitations on Security Interests in Governmental Receivables1-20
      • [D] : The Double Lockbox Technique1-23
      • [E] : Conclusion1-26
    • § 1:2.7 : Problem Areas1-26
      • [A] : Goods Owned by or Securing Others1-26
      • [B] : Rendition of Services1-29
      • [C] : Bill and Hold1-30
      • [D] : Ordinary-Course Transaction1-30
      • [E] : “Hidden Liens”1-30
      • [F] : Use of Assumed Names or Trade Styles1-33
      • [G] : Nonassignability Clauses1-33
      • [H] : Contra-Accounts1-33
      • [I] : Inventory Liens1-34
      • [J] : State Enforcement Statutes1-34
  • § 1:3 : Transaction Types and Characteristics1-34
    • § 1:3.1 : Commercial Finance1-34
      • [A] : Direct Loans1-35
      • [B] : Revolving Versus Term Loans1-35
      • [C] : Payable on Demand1-35
      • [D] : On Open Account1-36
      • [E] : Security1-37
      • [F] : Control of Collateral1-37
      • [G] : Non-Notification1-37
      • [H] : Control of Proceeds1-38
      • [I] : Lending Formula1-49
      • [J] : “Pursuant to a Commitment”1-51
      • [K] : Collection Days1-52
    • § 1:3.2 : Nonpossessory or “Bank” Financing1-52
      • [A] : Direct Loans1-52
      • [B] : Revolving Loans1-53
      • [C] : Note1-53
      • [D] : Security1-53
      • [E] : Lack of Controls on Collateral1-54
      • [F] : Lending Formula1-54
      • [G] : Periodic Settlement1-54
    • § 1:3.3 : Multiple Borrowers1-54
    • § 1:3.4 : Multiple Lenders1-56
    • § 1:3.5 : Guaranties1-58
  • Appendix 1A : General Continuing GuarantyApp. 1A-1
Chapter 2: Purchases of Accounts; and Appendices 2A-2E
  • § 2:1 : Introduction2-2
  • § 2:2 : Treatment Under the U.C.C.2-3
    • § 2:2.1 : Sale of Accounts2-3
    • § 2:2.2 : Sale of Intangibles2-3
  • § 2:3 : Factoring2-4
    • § 2:3.1 : Origins2-4
    • § 2:3.2 : Characteristics2-4
      • [A] : Sale2-5
      • [B] : Types of Accounts Sold2-5
      • [C] : Limited Recourse; Disputes and Chargeback2-5
      • [D] : Notice to the Customer2-6
      • [E] : Credit Approval2-6
      • [F] : Determination and Payment of the Purchase Price2-7
      • [G] : Record Keeping2-8
    • § 2:3.3 : Variations on the Theme2-8
      • [A] : Advance Factoring2-9
      • [B] : Discount Factoring2-10
    • § 2:3.4 : Equity Loans2-11
  • § 2:4 : Off-Balance-Sheet Accounts Financing2-12
    • § 2:4.1 : In General2-12
    • § 2:4.2 : Characteristics2-13
      • [A] : Batch Operation2-13
      • [B] : Credit Approval2-13
      • [C] : Notification2-13
      • [D] : Perfection2-13
      • [E] : Collection of Accounts2-14
      • [F] : Recourse2-15
  • § 2:5 : True Sale; Purchase Versus Loan2-15
    • § 2:5.1 : Introduction2-15
    • § 2:5.2 : Accounting Sale Requirements2-16
    • § 2:5.3 : Legal Sale Requirements2-16
    • § 2:5.4 : Tax Sale Requirements2-22
    • § 2:5.5 : Related Legal Issues2-23
  • § 2:6 : Securitization2-23
    • § 2:6.1 : Introduction2-23
    • § 2:6.2 : Basic Elements2-24
      • [A] : Special-Purpose Vehicle2-24
      • [B] : Funding of Vehicle2-26
      • [C] : Nature of Purchase/Facility2-29
      • [D] : Collection Agent2-30
      • [E] : Backup Facilities for the Vehicle2-30
    • § 2:6.3 : Nature of Accounts Financed2-31
    • § 2:6.4 : Bankruptcy Issues2-32
      • [A] : Bankruptcy of the Vehicle2-32
      • [B] : Bankruptcy of the Originator2-33
    • § 2:6.5 : Intangibles Subject to Federal Law2-34
    • § 2:6.6 : Tax Issues2-37
  • § 2:7 : Documentation2-37
    • § 2:7.1 : Factoring2-37
    • § 2:7.2 : Off-Balance-Sheet Financing2-38
    • § 2:7.3 : Intangibles2-38
  • Appendix 2A : Factoring Agreement (Wholesale-Maturity)2-38
  • Appendix 2B : Factoring Agreement (Retail-Advance)App. 2B-1
  • Appendix 2C : Assignment of Factoring Proceeds and Intercreditor AgreementApp. 2C-1
  • Appendix 2D : Agreement for The Off-Balance-Sheet Financing of Export ReceivablesApp. 2D-1
  • Appendix 2E : Trademark Collateral Assignment and Security AgreementApp. 2E-1
Chapter 3: Inventory Financing; and Appendices 3A-3D
  • § 3:1 : Introduction3-2
    • § 3:1.1 : Definition of Inventory3-2
      • [A] : Goods3-3
      • [B] : Held for Sale or Lease3-3
      • [C] : To Be Furnished Under Contracts of Service3-4
      • [D] : Raw Materials, Work in Progress3-4
      • [E] : Materials Used or Consumed in a Business3-5
    • § 3:1.2 : Types of Inventory3-5
    • § 3:1.3 : Types of Financing3-6
      • [A] : Working Capital3-6
      • [B] : Purchase Money3-7
    • § 3:1.4 : Consignments Under Article 93-9
      • [A] : What Constitutes a Consignment Under Article 9?3-9
        • [A][1] : Delivery for Purpose of Sale3-10
        • [A][2] : The Merchant3-11
        • [A][3] : Excluded Consignments3-12
      • [B] : Perfection and Priority Rules for Consignments3-12
      • [C] : Practical Considerations Regarding Consignment Transactions3-13
  • § 3:2 : Fungible Inventory Financing3-14
    • § 3:2.1 : Blanket Financing by a Lender3-14
      • [A] : Basic Elements3-14
      • [B] : Link with Receivables3-14
      • [C] : Formula3-15
      • [D] : Possession/Control3-16
      • [E] : Sale of Goods3-17
      • [F] : Other Terms3-18
    • § 3:2.2 : Blanket Financing by a Vendor3-19
      • [A] : Basic Elements3-19
    • § 3:2.3 : Unitary Financings3-20
      • [A] : Letter of Credit3-20
      • [B] : Documentary Drafts3-20
    • § 3:2.4 : Statutory Aspects3-21
      • [A] : Perfection and Priority3-21
      • [B] : Other Priority Issues3-22
      • [C] : Trademarks3-23
      • [D] : Regulated Industries3-24
      • [E] : Regulated Goods3-24
  • § 3:3 : In-Transit Inventory3-24
    • § 3:3.1 : Negotiable Documents3-25
      • [A] : Perfection with Respect to Goods Covered by Negotiable Documents3-25
      • [B] : Rights of the Secured Party Against a Holder of the Negotiable Documents That Have Been Duly Negotiated3-28
    • § 3:3.2 : Perfection with Respect to Goods Covered by Nonnegotiable Documents3-30
    • § 3:3.3 : Perfection with Respect to Goods Not Covered by Documents3-30
    • § 3:3.4 : Rights of Stoppage3-32
    • § 3:3.5 : Choice of Law Issues Related to In-Transit Inventory3-34
    • § 3:3.6 : Practical Considerations Regarding In-Transit Inventory3-37
  • § 3:4 : Unit Inventory Financing; Floor Plan3-38
    • § 3:4.1 : Basic Elements3-38
      • [A] : Types of Units3-38
      • [B] : Parties3-38
      • [C] : Advance Rate3-39
      • [D] : Agreement Terms3-39
      • [E] : Interface with Chattel Paper3-40
      • [F] : Cross-Collateral3-40
      • [G] : Perfection3-41
      • [H] : Intercreditor Issues and Priority3-41
  • § 3:5 : Documents3-42
  • Appendix 3A : General Security Agreement (Inventory)App. 3A-1
  • Appendix 3B : Intercreditor AgreementApp. 3B-1
  • Appendix 3C : Intercreditor AgreementApp. 3C-1
  • Appendix 3D : Lender’s Loss Payable EndorsementApp. 3D-1
Chapter 4: Equipment and Fixture Financing; and Appendices 4A-4D
  • § 4:1 : Introduction4-2
  • § 4:2 : Definitional Issues4-3
    • § 4:2.1 : Defining “Equipment”4-3
      • [A] : The Basic Term “Goods”4-3
      • [B] : The Basic Definition of “Equipment”4-3
      • [C] : Contrasted with Inventory4-4
      • [D] : Contrasted with “Fixtures”4-5
      • [E] : Contrasted with Other Goods4-5
      • [F] : Accessions4-5
    • § 4:2.2 : Defining the Transaction4-6
      • [A] : Purchase Money or Not4-6
      • [B] : Type of Transaction4-11
      • [C] : Contrast with Lease4-11
      • [D] : Retail Transactions4-13
  • § 4:3 : Documenting the Transaction4-13
    • § 4:3.1 : Purchase Money Vendor Transactions4-13
      • [A] : Security Agreement4-14
      • [B] : Warranty and Waiver Provisions4-14
    • § 4:3.2 : Purchase Money Lender Transactions4-14
      • [A] : Security Agreement4-14
      • [B] : Loan Proceeds Payment Letter4-14
    • § 4:3.3 : Non-Purchase Money Transactions4-15
    • § 4:3.4 : Documents and Issues in Common4-15
      • [A] : Description of Collateral4-15
      • [B] : Title to the Equipment4-16
      • [C] : Landlord/Mortgagee Waiver4-17
      • [D] : Use of Premises4-17
      • [E] : Insurance4-18
      • [F] : Financing Statement4-18
      • [G] : Vendor Repurchase4-20
      • [H] : Delivery and Installation Certificate4-20
      • [I] : Proceeds4-20
      • [J] : Related Rights4-21
    • § 4:3.5 : Certificate-of-Title Goods4-21
      • [A] : Covered Goods4-21
      • [B] : Perfection4-22
  • § 4:4 : Fixture Financing4-24
    • § 4:4.1 : Definitional Issues4-24
      • [A] : Basic U.C.C. Definition4-24
      • [B] : State Law4-25
      • [C] : Related U.C.C. Definitions4-25
    • § 4:4.2 : Perfection4-26
      • [A] : Mortgage4-26
      • [B] : Financing Statement Filed in the Real Property Records4-26
      • [C] : Financing Statement Filed in the Personal Property Records4-27
    • § 4:4.3 : Priority4-28
      • [A] : Normal Priority4-28
      • [B] : Purchase Money Priority4-28
      • [C] : Movable Goods4-29
      • [D] : Manufactured Homes4-29
      • [E] : Lien Creditors4-29
      • [F] : Transactional Subordination4-30
      • [G] : Subordination4-31
      • [H] : Removal4-31
  • § 4:5 : Collateral Assignments of Real Estate Leases4-31
  • § 4:6 : Documents4-32
  • Appendix 4A : SECURITY AGREEMENT—EQUIPMENTApp. 4A-1
  • Appendix 4B : GENERAL SECURITY AGREEMENT—EQUIPMENTApp. 4A-2
  • Appendix 4C : SECURITY AGREEMENTApp. 4B-10
  • Appendix 4D : COLLATERAL ASSIGNMENT OF LEASESApp. 4C-8
Chapter 5: Chattel Paper; and Appendix 5A
  • § 5:1 : Introduction5-1
  • § 5:2 : Definitional Issues5-2
    • § 5:2.1 : Chattel Paper5-2
    • § 5:2.2 : Lease Versus Finance Transaction5-3
  • § 5:3 : Creation of the Paper5-3
    • § 5:3.1 : Types of Chattel Paper5-3
    • § 5:3.2 : Terms5-4
      • [A] : Monetary Obligation5-5
      • [B] : Waiver of Defenses5-5
      • [C] : Some Lease Provisions5-5
      • [D] : Time-Price Doctrine5-5
    • § 5:3.3 : State Regulation5-6
  • § 5:4 : Financing Choices5-7
    • § 5:4.1 : Finance Transactions5-7
      • [A] : Amount of Advance5-7
      • [B] : Amortization5-7
      • [C] : Independence of Transaction5-8
    • § 5:4.2 : Sale Transactions5-8
      • [A] : Price and Payment5-9
      • [B] : Collections5-9
      • [C] : Recourse5-9
    • § 5:4.3 : Reserves5-10
  • § 5:5 : Priority Problems5-11
  • § 5:6 : Documentation5-13
  • Appendix 5A : Conditional Sale Contract (Security Agreement)App. 5A-1
Chapter 6: Letters of Credit; and Appendices 6A-6C
  • § 6:1 : Introduction6-2
    • § 6:1.1 : Nature of a Letter of Credit6-2
      • [A] : Legal Effect6-2
      • [B] : Parties6-4
      • [C] : Characterization6-4
  • § 6:2 : Uses of Letters of Credit6-5
    • § 6:2.1 : Support of Commercial Paper6-5
    • § 6:2.2 : Assure Payment of Investment Obligations6-5
    • § 6:2.3 : Support Industrial Revenue Bonds6-6
    • § 6:2.4 : Replace Cash Deposits6-6
  • § 6:3 : Applicable Law6-6
  • § 6:4 : Issuers of Letters of Credit6-7
  • § 6:5 : Characteristics of Letters of Credit6-8
    • § 6:5.1 : Commercial Letter of Credit6-8
    • § 6:5.2 : Standby Letter of Credit6-9
    • § 6:5.3 : “Direct Pay” Letter of Credit6-10
    • § 6:5.4 : Payment upon Demand Alone6-11
  • § 6:6 : Documentation6-11
    • § 6:6.1 : Application6-11
    • § 6:6.2 : Reimbursement Agreement6-11
    • § 6:6.3 : Drafts and Documents6-12
    • § 6:6.4 : Other Documents6-13
    • § 6:6.5 : Bank Authority6-14
  • § 6:7 : Provisions of Letters of Credit6-14
    • § 6:7.1 : Revocability6-14
    • § 6:7.2 : Multiple Drawings6-16
    • § 6:7.3 : Acts of God6-16
    • § 6:7.4 : Transferability and Assignment6-17
    • § 6:7.5 : Right to Pay6-19
  • § 6:8 : Enforcement of Letters of Credit6-19
    • § 6:8.1 : Issuer’s Basic Obligation or Right to Pay6-19
  • § 6:9 : Bankruptcy Considerations6-22
    • § 6:9.1 : Bankruptcy of the Account Party6-22
    • § 6:9.2 : Bankruptcy of the Beneficiary6-24
  • § 6:10 : Documentation6-24
  • Appendix 6A : Reimbursement AgreementApp. 6A-1
  • Appendix 6B : Letter Agreement for Assigning the Right to Proceeds Under a Letter of CreditApp. 6B-1
  • Appendix 6C : Standby Letter of CreditApp. 6C-1
Chapter 7: Covenants
  • § 7:1 : Introduction7-2
  • § 7:2 : General Types7-2
  • § 7:3 : Distinction from Conditions7-4
  • § 7:4 : Distinction from Events of Default7-5
  • § 7:5 : Distinction from Representations and Warranties7-6
  • § 7:6 : Covenants in Commercial Finance7-6
    • § 7:6.1 : Traditional Covenants7-7
      • [A] : Collateral Maintenance7-7
      • [B] : Collateral Protection7-8
      • [C] : Change of Structure or Location7-9
      • [D] : Maintenance of Existence7-9
      • [E] : Maintenance of Perfection7-10
      • [F] : Furnishing of Information7-10
      • [G] : Lien Prohibition7-11
      • [H] : Ordinary-Course Receivable Creation7-12
      • [I] : Compliance with Laws7-12
      • [J] : Leases7-12
      • [K] : Environmental Matters7-12
      • [L] : Interest Rate Protection7-13
      • [M] : Determination of Borrowing Base7-13
      • [N] : Transactions with Affiliates7-14
      • [O] : Use of Proceeds7-14
      • [P] : Accounting Methods7-14
      • [Q] : ERISA and Tax Compliance7-14
      • [R] : Insurance7-14
      • [S] : Title to the Goods7-15
      • [T] : Location of the Goods7-16
      • [U] : Disposition of the Goods7-16
      • [V] : Other Protections7-17
    • § 7:6.2 : Expanded Covenants7-17
      • [A] : Financial Positions and Ratios7-17
      • [B] : Dividend and Investment Restrictions7-19
      • [C] : Capital Expenditures7-20
      • [D] : Debt Limitations7-20
      • [E] : Reporting Requirements7-21
  • § 7:7 : Role of Covenants in Purchases of Receivables7-21
  • § 7:8 : Role of Covenants in Financing of Intellectual Property7-22
    • § 7:8.1 : Collateral Protection by Debtor7-22
    • § 7:8.2 : Lender/Borrower Covenants7-23
    • § 7:8.3 : Borrower Representations7-23
    • § 7:8.4 : Default7-24
  • § 7:9 : Documentation [Review]7-24
Chapter 8: Participations and Assignments
  • § 8:1 : Introduction8-2
    • § 8:1.1 : Format of the Transaction8-3
    • § 8:1.2 : Authorities8-4
  • § 8:2 : General Nature of Participation8-4
    • § 8:2.1 : Purchase from Lead Lender Versus Loan to Lead Lender8-4
      • [A] : Purchase Characteristics8-4
      • [B] : Loan Characteristics8-6
    • § 8:2.2 : Obligations of the Lead Lender to Its Participants8-8
      • [A] : At Inception8-8
      • [B] : Is a Loan Participation a “Security”?8-9
      • [C] : During the Transaction8-10
    • § 8:2.3 : Lead Lender/Participant Conflicts8-11
      • [A] : Other Loans and Collateral8-11
      • [B] : Partial Participations8-11
      • [C] : Fees and Interest8-12
      • [D] : Computation Issues8-14
      • [E] : Modification of Loan Terms8-16
      • [F] : Overadvances8-16
      • [G] : Enforcement Activity8-19
      • [H] : Right of Termination8-19
      • [I] : Sales of Other Participations8-20
      • [J] : The Perils of Participations Redux8-21
      • [K] : Bankruptcy of the Lead Lender8-26
      • [L] : Performance by Participant8-28
      • [M] : Indemnities and Expenses8-28
    • § 8:2.4 : Multi-Lender Issues8-29
  • § 8:3 : Participations in Purchases of Receivables8-31
    • § 8:3.1 : Factoring Participation8-31
    • § 8:3.2 : Layoff Agreements8-32
    • § 8:3.3 : Off-Balance-Sheet Transactions8-32
  • § 8:4 : Reverse Participations8-33
    • § 8:4.1 : Purpose8-33
    • § 8:4.2 : Mechanics8-33
  • § 8:5 : Junior Participations8-34
    • § 8:5.1 : Equalization or Default Participations8-34
      • [A] : Origination8-35
      • [B] : Mechanics8-35
  • § 8:6 : Syndicated Loans and the Secondary Loan Trading Market8-36
    • § 8:6.1 : Introduction8-36
    • § 8:6.2 : Development of Loan Trading Market8-36
    • § 8:6.3 : Types of Secondary Loan Sales8-37
    • § 8:6.4 : Formation of the LSTA8-40
    • § 8:6.5 : Syndicated Loan Trading and the Use of LSTA Documentation8-41
      • [A] : Underwriting and Due Diligence8-42
      • [B] : Binding Trade and Trade Confirmation8-42
      • [C] : Documentation Requirements and Timing8-43
      • [D] : LSTA Standard Terms and Conditions8-44
    • § 8:6.6 : Syndicated Loan Market Information8-45
Chapter 9: Subordination; and Appendices 9A-9B
  • § 9:1 : Introduction9-2
  • § 9:2 : Debt Subordination9-4
    • § 9:2.1 : Definitional Issues9-4
      • [A] : Definition of Junior Debt9-4
      • [B] : Definition of Senior Debt9-5
    • § 9:2.2 : Degree of Subordination9-7
      • [A] : Principal9-8
      • [B] : Interest9-10
      • [C] : Standstill9-11
    • § 9:2.3 : Enforcement9-12
      • [A] : Direct Collection9-12
      • [B] : Turnover9-12
      • [C] : Reliance9-13
    • § 9:2.4 : Related Problem9-14
      • [A] : Junior Covenants9-14
      • [B] : Events of Default9-14
      • [C] : Senior Debt Amendments and Changes9-15
      • [D] : Junior Debt Amendments and Changes9-16
      • [E] : Indenture Trustees9-16
      • [F] : Junior Voting Provisions9-17
      • [G] : Maturity of Junior Debt9-17
    • § 9:2.5 : Subordinated Debt As “Capital”9-17
      • [A] : Verification9-18
      • [B] : Debt Versus Equity9-18
    • § 9:2.6 : Enforceability Against Transferees9-18
    • § 9:2.7 : Bankruptcy Issues9-26
      • [A] : Enforceability9-26
      • [B] : Turnover9-27
      • [C] : Reinstatement9-27
      • [D] : Waivers9-27
      • [E] : Unauthorized Solicitation; Designation9-28
    • § 9:2.8 : Drafting Concerns9-30
      • [A] : Notice Considerations9-30
      • [B] : Borrower9-31
    • § 9:2.9 : Subrogation9-31
  • § 9:3 : Lien Subordination9-32
    • § 9:3.1 : Definition Issues9-32
      • [A] : Debt9-33
      • [B] : Collateral9-33
      • [C] : Liens9-34
      • [D] : Parties9-36
    • § 9:3.2 : Extent of Subordination9-37
      • [A] : Standstill9-37
      • [B] : Review Rights9-38
      • [C] : Marshaling9-39
    • § 9:3.3 : Circular Liens and Waivers9-40
      • [A] : Circular Liens9-40
      • [B] : Waivers9-41
    • § 9:3.4 : Intercreditor Agreements9-43
  • § 9:4 : Purchase Option9-43
  • § 9:5 : Structural Subordination9-44
  • § 9:6 : Equitable Subordination9-44
  • § 9:7 : Documentation9-45
    • § 9:7.1 : Debt Subordination9-45
    • § 9:7.2 : Lien Subordination9-45
  • Appendix 9A : Debt Subordination Provisions for NoteApp. 9A-1
  • Appendix 9B : Intercreditor AgreementApp. 9B-1
Chapter 10: Fraudulent Transfers
  • § 10:1 : Introduction10-2
  • § 10:2 : Basic Definitions10-4
    • § 10:2.1 : Bankruptcy Code10-5
    • § 10:2.2 : Uniform Fraudulent Conveyance Act10-6
    • § 10:2.3 : Uniform Fraudulent Transfer Act10-6
    • § 10:2.4 : Common Law and Other Sources10-7
  • § 10:3 : Transfer Made or Obligation Incurred10-8
  • § 10:4 : Consideration or Value10-8
    • § 10:4.1 : Direct Consideration10-9
      • [A] : Bankruptcy Code10-9
      • [B] : U.F.C.A.10-11
      • [C] : U.F.T.A.10-12
    • § 10:4.2 : Indirect Consideration10-13
    • § 10:4.3 : Recipient of Consideration10-14
    • § 10:4.4 : Repayment of Existing Debt10-15
    • § 10:4.5 : Savings Clauses10-18
  • § 10:5 : Insolvency10-21
    • § 10:5.1 : Solvency Letters or Procedures10-21
    • § 10:5.2 : Assets10-22
    • § 10:5.3 : Liabilities10-25
    • § 10:5.4 : Leveraged Buyout Merger/Pro Forma Technique10-27
  • § 10:6 : Unable to Pay Its Debts10-30
  • § 10:7 : Unreasonably Small Capital10-31
  • § 10:8 : Actual Intent10-32
  • § 10:9 : Creditor Remedies10-33
    • § 10:9.1 : Generally10-33
    • § 10:9.2 : Protection of a Buyer/Transferee10-35
Chapter 11: Competing Liens
  • § 11:1 : Introduction11-2
  • § 11:2 : U.C.C. Lien Competition11-3
    • § 11:2.1 : Collateral from Another Jurisdiction11-3
    • § 11:2.2 : Previously Owned Goods11-4
    • § 11:2.3 : Nonfiling Perfection11-5
    • § 11:2.4 : Assignees, Subrogees, Affiliates, and Other Acquirers11-6
    • § 11:2.5 : Bulk Sale Creditors11-8
    • § 11:2.6 : Sellers of Goods11-9
    • § 11:2.7 : Insignificant Assignments of Accounts11-9
    • § 11:2.8 : Certified Securities, Instruments, and Negotiable Documents11-10
    • § 11:2.9 : Subsequent Lien Creditors11-11
    • § 11:2.10 : Ordinary-Course Buyers11-12
    • § 11:2.11 : Non-Ordinary-Course Buyers11-13
    • § 11:2.12 : Purchase Money Security Interests11-13
    • § 11:2.13 : Consignments11-15
    • § 11:2.14 : Returned Goods11-15
    • § 11:2.15 : Negotiable Documents11-16
      • [A] : Goods Held by a Bailee11-16
    • § 11:2.16 : Chattel Paper11-17
    • § 11:2.17 : Collecting Bank11-17
    • § 11:2.18 : Changes of Structure11-18
    • § 11:2.19 : Disposition of Collateral11-19
  • § 11:3 : Bankruptcy11-20
  • § 11:4 : State Statutory Liens11-20
    • § 11:4.1 : Suppliers of Goods11-21
    • § 11:4.2 : Suppliers of Services11-21
    • § 11:4.3 : Landlords11-22
    • § 11:4.4 : Warehousemen11-23
    • § 11:4.5 : Mortgagees11-23
    • § 11:4.6 : Environmental Laws11-23
  • § 11:5 : Federal Statutory or Regulatory Competitors11-24
    • § 11:5.1 : Federal Tax and Similar Liens11-24
    • § 11:5.2 : Government Contracts11-33
    • § 11:5.3 : Special Statutes11-33
    • § 11:5.4 : Hot Goods11-34
    • § 11:5.5 : Environmental Laws11-34
    • § 11:5.6 : Perishable Agricultural Commodities Act11-35
Chapter 12: Bankruptcy Issues
  • § 12:1 : Introduction12-2
    • § 12:1.1 : Property of the Estate12-2
  • § 12:2 : Lender’s Right to Deal with the Collateral12-2
    • § 12:2.1 : Automatic Stay12-2
      • [A] : Lifting the Stay12-3
      • [B] : Exemptions12-5
    • § 12:2.2 : Ownership of Property12-6
      • [A] : Accounts Receivable12-6
      • [B] : Leased Property12-7
      • [C] : Consigned Inventory12-9
      • [D] : After-Acquired Property12-10
    • § 12:2.3 : Offset12-10
  • § 12:3 : Debtor’s Rights to Use the Collateral12-10
    • § 12:3.1 : Cash and Cash Collections12-11
    • § 12:3.2 : Noncash Property12-11
    • § 12:3.3 : Leased Property12-12
  • § 12:4 : Provision for “Adequate Protection”12-12
  • § 12:5 : Financing the Chapter 11 Debtor12-15
    • § 12:5.1 : Voluntary Versus “Involuntary” Financing12-15
    • § 12:5.2 : Documentation12-16
    • § 12:5.3 : Crossover Versus Continuing Lien12-17
    • § 12:5.4 : Protecting the Repayment of New Loans12-18
    • § 12:5.5 : Ability to Foreclose12-19
    • § 12:5.6 : Conversion of Pre-Petition Collateral12-20
    • § 12:5.7 : Coming Out of Chapter 1112-21
    • § 12:5.8 : Some Thoughts on Approaches12-22
  • § 12:6 : Other Dangers for the Secured Creditor12-23
    • § 12:6.1 : Preferences12-23
    • § 12:6.2 : Fraudulent Conveyances12-29
    • § 12:6.3 : Lapse of Perfection During the Case12-30
    • § 12:6.4 : Other Financings12-32
    • § 12:6.5 : Offsets12-33
    • § 12:6.6 : Fair Labor Standards Act12-35
    • § 12:6.7 : Equitable Subordination12-36
    • § 12:6.8 : Chapter 11 Plans12-39
      • [A] : Credit Bidding12-40
      • [B] : “Gifting”12-45
Chapter 13: Closing Considerations; and Appendices 13A-13E
  • § 13:1 : Introduction13-2
  • § 13:2 : Receivables Finance Takeover13-3
    • § 13:2.1 : Alternative Choices13-3
      • [A] : Purchase of Position13-3
      • [B] : Payout of Old Lender13-4
    • § 13:2.2 : Mechanics13-5
      • [A] : Purchase13-5
      • [B] : Payout13-7
      • [C] : Indemnities by New Lender13-10
      • [D] : General Closing Steps13-11
  • § 13:3 : Factoring13-15
    • § 13:3.1 : Differences from Receivables Finance13-16
      • [A] : Re-Assignment of Receivables13-16
      • [B] : Credit Balance13-16
      • [C] : U.C.C. Filings13-17
      • [D] : Indemnity13-17
  • § 13:4 : Opinion Issues13-17
    • § 13:4.1 : General Terms13-18
      • [A] : Organization and Authorization13-18
      • [B] : Due Execution and Delivery13-19
      • [C] : Valid, Binding, and Enforceable13-19
      • [D] : Noncontravention of Other Agreements13-20
      • [E] : Noncontravention of Laws13-20
    • § 13:4.2 : Collateral Security Terms13-20
      • [A] : Valid, Binding, Enforceable Liens13-21
      • [B] : Perfection13-21
      • [C] : Priority13-23
    • § 13:4.3 : Assumptions and Reliance13-24
      • [A] : Genuineness13-24
      • [B] : Due Execution by Others13-24
      • [C] : Certificates of Officers13-24
      • [D] : Other Opinions13-24
    • § 13:4.4 : Exceptions13-25
      • [A] : As to Enforceability13-25
      • [B] : As to Priority13-26
  • § 13:5 : U.C.C. Filing Issues13-28
    • § 13:5.1 : Used Equipment; Specially Acquired Inventory13-28
    • § 13:5.2 : Computer Searches13-28
    • § 13:5.3 : Bankrupt Companies13-29
    • § 13:5.4 : General Search and Filing Issues13-30
  • § 13:6 : Disbursement and Use of Loan Proceeds13-33
    • § 13:6.1 : Tying in to Loan Documents13-33
    • § 13:6.2 : Use of Proceeds13-34
    • § 13:6.3 : Timing Issues13-34
      • [A] : Taking of Collateral and Perfection13-34
      • [B] : Acquired Entities13-35
      • [C] : Release of Liens13-35
  • § 13:7 : Commitment Letters13-35
    • § 13:7.1 : Compensation13-37
    • § 13:7.2 : Conditions13-39
      • [A] : SunGard Provisions13-39
      • [B] : Modifications to SunGard and Xerox Provisions13-42
    • § 13:7.3 : Syndication13-44
  • § 13:8 : Regulation U13-45
    • § 13:8.1 : Substantive Requirement13-46
      • [A] : Purpose Credit13-46
      • [B] : Direct or Indirect Security13-46
      • [C] : Maximum Loan Value13-47
    • § 13:8.2 : Reporting Requirement13-48
      • [A] : Regulation U Forms13-48
      • [B] : Revolving Credit Facilities13-49
      • [C] : Annual Reporting for Non-Bank Lenders13-49
    • § 13:8.3 : Consequences of Non-Compliance with Regulation U13-49
  • § 13:9 : Documentation13-50
  • Appendix 13A : Indicative Terms: Revolving Credit FacilityApp. 13A-1
  • Appendix 13B : Commitment LetterApp. 13B-1
  • Appendix 13C : Commercial Finance Association: Letter of IndemnityApp. 13C-1
  • Appendix 13D : Landlord’s Waiver and ConsentApp. 13D-1
  • Appendix 13E : Closing MemorandumApp. 13E-1
Chapter 14: Lender Liability; and Appendix 14A
  • § 14:1 : Introduction14-1
  • § 14:2 : Contract Liability14-6
    • § 14:2.1 : Oral Promises14-7
    • § 14:2.2 : Failure of a Condition14-10
    • § 14:2.3 : Good Faith14-12
    • § 14:2.4 : Commercial Reasonableness14-18
  • § 14:3 : Tort Liability14-22
    • § 14:3.1 : Fiduciary Duty and Control14-22
    • § 14:3.2 : Improvident Lending/Aiding and Abetting14-27
  • § 14:4 : Statutory Liability14-30
    • § 14:4.1 : Environmental Laws14-30
    • § 14:4.2 : Securities Laws14-33
    • § 14:4.3 : Federal Tax Laws14-34
    • § 14:4.4 : RICO14-35
  • Appendix 14A : Term SheetApp. 14A-1
Chapter 15: Overview of Revised Article 9; and Appendix 15A
  • § 15:1 : Introduction15-3
    • § 15:1.1 : Status15-4
    • § 15:1.2 : Purpose of Revisions15-6
    • § 15:1.3 : Consumer Transactions15-6
  • § 15:2 : Scope of Revised Article 915-7
    • § 15:2.1 : Accounts15-7
    • § 15:2.2 : Payment Intangibles15-8
    • § 15:2.3 : Promissory Notes15-8
    • § 15:2.4 : Chattel Paper15-9
    • § 15:2.5 : Electronic Chattel Paper15-9
    • § 15:2.6 : Investment Property15-10
    • § 15:2.7 : Deposit Accounts15-10
    • § 15:2.8 : Health-Care-Insurance Receivables15-10
    • § 15:2.9 : Commercial Tort Claims15-11
    • § 15:2.10 : Software Versus Goods15-12
    • § 15:2.11 : Consignments15-12
      • [A] : What Constitutes a Consignment Under Article 9?15-13
        • [A][1] : Delivery for Purpose of Sale15-14
        • [A][2] : The Merchant15-15
        • [A][3] : Excluded Transactions15-16
      • [B] : Perfection and Priority Rules for Consignments15-16
      • [C] : Practical Considerations Regarding Consignment Transactions15-17
    • § 15:2.12 : Promissory Notes Secured by Real Estate15-18
    • § 15:2.13 : Agricultural Liens15-18
    • § 15:2.14 : Letter-of-Credit Rights15-19
    • § 15:2.15 : Supporting Obligations15-19
    • § 15:2.16 : Good Faith15-20
    • § 15:2.17 : Adaptation to Electronic Contracting15-20
    • § 15:2.18 : Federal Preemption15-21
    • § 15:2.19 : Exclusions15-21
    • § 15:2.20 : “Debtor” Versus “Obligor”15-22
  • § 15:3 : Creation of Security Interests15-23
    • § 15:3.1 : The Security Agreement15-23
    • § 15:3.2 : Description of Collateral15-24
    • § 15:3.3 : Rights in or Power to Transfer Rights to Collateral15-25
    • § 15:3.4 : Assignment of Rights to Payment15-27
    • § 15:3.5 : Assignment of Other General Intangibles15-28
    • § 15:3.6 : New Debtor15-28
  • § 15:4 : Perfection of Security Interests15-28
    • § 15:4.1 : Automatic Perfection15-29
    • § 15:4.2 : Perfection in Supporting Obligations15-29
    • § 15:4.3 : Perfection by Filing15-29
      • [A] : Kinds of Collateral Subject to Perfection by Filing15-32
      • [B] : Location of the Debtor15-32
      • [C] : The Debtor’s Name15-33
      • [D] : Indication of the Collateral15-37
      • [E] : The Debtor’s Signature15-37
      • [F] : Effectiveness As to New Debtor15-39
      • [G] : Rejection or Incorrect Indexing by Filing Officer15-41
      • [H] : Minor Errors15-42
      • [I] : Multiple Secured Parties15-42
      • [J] : Termination Statements15-42
      • [K] : Bogus Filings15-43
      • [L] : Transition from Former Article 9 to Revised Article 915-45
    • § 15:4.4 : Perfection by Control15-45
      • [A] : Investment Property15-45
      • [B] : Deposit Accounts15-46
      • [C] : Electronic Chattel Paper15-46
      • [D] : Letter-of-Credit Rights15-47
    • § 15:4.5 : Perfection by Possession15-47
      • [A] : Instruments15-47
      • [B] : Money15-47
      • [C] : Tangible Chattel Paper15-47
      • [D] : Certificated Securities15-48
      • [E] : Goods and Negotiable Documents15-48
      • [F] : Collateral in the Hands of Third Parties15-48
      • [G] : Governing Law15-49
    • § 15:4.6 : Perfection in Proceeds15-49
      • [A] : Revised Definition of Proceeds15-49
      • [B] : Automatic Attachment and Perfection15-50
      • [C] : Tracing15-50
  • § 15:5 : Priority of Security Interests15-50
    • § 15:5.1 : General Rule15-50
    • § 15:5.2 : Effect of Other U.C.C. Provisions15-51
    • § 15:5.3 : Filing Versus Control15-51
    • § 15:5.4 : Filing Versus Possession15-51
    • § 15:5.5 : Automatic Versus Other Methods of Perfection15-51
    • § 15:5.6 : Control Versus Control15-52
    • § 15:5.7 : Purchase Money Security Interests15-53
      • [A] : Multiple Shipments15-53
      • [B] : Multiple Purchase Money Security Interests15-53
      • [C] : Software15-53
      • [D] : Consignments15-54
      • [E] : Proceeds15-54
      • [F] : Dual Status Versus Transformation Rule15-54
    • § 15:5.8 : Lien Creditors15-55
  • § 15:6 : Transfers of Collateral15-55
    • § 15:6.1 : Rights of Transferees Generally15-55
    • § 15:6.2 : Transferees of Money and Funds from Deposit Accounts15-56
    • § 15:6.3 : Buyers in Ordinary Course of Business15-56
    • § 15:6.4 : Nonexclusive Licensees in Ordinary Course of Business15-56
    • § 15:6.5 : Purchasers of Chattel Paper15-57
    • § 15:6.6 : Purchasers of Promissory Notes15-57
    • § 15:6.7 : Purchasers of Property Subject to Articles 3 and 815-58
    • § 15:6.8 : Retention of Proceeds by Junior Secured Party15-58
  • § 15:7 : Enforcement of Security Interests15-58
    • § 15:7.1 : Rights of Guarantors15-58
    • § 15:7.2 : Collection Rights of Secured Party15-58
    • § 15:7.3 : Disposition of Collateral by Secured Party15-59
      • [A] : Preparation of Collateral15-59
      • [B] : Certain Unusually Low-Priced Dispositions15-59
      • [C] : Warranties15-60
      • [D] : Non-Cash Proceeds15-60
      • [E] : Notice of Disposition15-60
      • [F] : Acceptance of Collateral15-61
      • [G] : Effect of Non-Compliance15-61
  • § 15:8 : Transition Rules15-62
  • Appendix 15A : Revised Article 9 Security AgreementApp. 15A-1
Chapter 16: Revised Article 9 Transition Rules
  • § 16:1 : Introduction16-1
  • § 16:2 : The Rules16-3
    • § 16:2.1 : Perfection by Filing Under Former Article 916-3
    • § 16:2.2 : Perfection by Non-Filing Under Revised Article 916-6
    • § 16:2.3 : Perfection Outside of Former Article 916-7
    • § 16:2.4 : Perfection Under Former Article 9 but Revised Article 9 Inapplicable16-8
    • § 16:2.5 : Unperfected Under Former Article 9 but Perfected Under Revised Article 916-9
    • § 16:2.6 : Continuation Under Revised Article 9 of Filings Under Former Article 916-10
    • § 16:2.7 : Amendment Under Revised Article 9 of Filings Under Former Article 916-12
    • § 16:2.8 : Termination Under Revised Article 9 of Filings Under Former Article 916-12
    • § 16:2.9 : Terminology16-13
    • § 16:2.10 : Transition Issues When Searching16-14
    • § 16:2.11 : Earlier Attached, Unperfected Security Interests16-15
  • § 16:3 : How Priority Will Work Under the Transition Rules16-15
  • § 16:4 : What Secured Party Can Do to Anticipate Revised Article 916-16
Chapter 17: Intellectual Property Financing; and Appendices 17A-17C
  • § 17:1 : Introduction17-2
    • § 17:1.1 : Types of Intellectual Property17-3
    • § 17:1.2 : Increasing Importance of Intellectual Property As Collateral17-3
    • § 17:1.3 : Interplay of State, Federal and International Law17-4
  • § 17:2 : Legal Background17-4
    • § 17:2.1 : Perfection of Security Interests Under Article 917-4
    • § 17:2.2 : Impact of Bankruptcy on Security Interests17-5
    • § 17:2.3 : Federal and International Preemption of Article 917-6
      • [A] : Article 9 Provisions Addressing Preemption17-6
      • [B] : Case Law Addressing Preemption17-8
      • [C] : Not All Intellectual Property Is Governed by Federal or International Law17-8
  • § 17:3 : Security Interests in Patents17-8
    • § 17:3.1 : Federal Law—The Patent Act of 195217-9
    • § 17:3.2 : Case Law on Perfection of Security Interests in Patents17-10
    • § 17:3.3 : Uncertainties and Practice17-11
  • § 17:4 : Security Interests in Trademarks17-16
    • § 17:4.1 : Federal Law—The Lanham Act17-16
    • § 17:4.2 : State Trademark Protection17-17
    • § 17:4.3 : Case Law on Perfection of Security Interests in Trademarks17-17
    • § 17:4.4 : Uncertainties and Practice17-18
  • § 17:5 : Security Interests in Copyrights17-19
    • § 17:5.1 : Federal Law—The Copyright Act of 197617-20
    • § 17:5.2 : Case Law on Perfection of Security Interests in Copyrights17-21
    • § 17:5.3 : Uncertainties and Practice17-24
    • § 17:5.4 : Source Code Escrows17-25
  • § 17:6 : Security Interests in Mask Works17-26
    • § 17:6.1 : Federal Law—The Semiconductor Act of 198417-26
    • § 17:6.2 : Uncertainties and Practice17-26
  • § 17:7 : Security Interests in Trade Secrets17-27
    • § 17:7.1 : Uncertainties and Practice17-27
  • § 17:8 : Security Interests in Rights in Proceeds of Intellectual Property17-28
    • § 17:8.1 : Royalties, Licenses, and Infringement Claims17-28
    • § 17:8.2 : Uncertainties and Practice17-30
  • § 17:9 : Security Interests in Goods That Incorporate Intellectual Property Rights17-33
    • § 17:9.1 : Trademark Branded Goods17-33
    • § 17:9.2 : Goods Manufactured Under Patents17-35
    • § 17:9.3 : Goods Whose Packaging or Labeling Includes Copyrights17-35
    • § 17:9.4 : Hybrid Goods with Embedded Computer Programs17-36
  • § 17:10 : Other Issues Affecting Intellectual Property Security Interests17-37
    • § 17:10.1 : Difficulty of Obtaining Current Accurate Searches17-37
    • § 17:10.2 : Delays in Recordation of Documents17-38
    • § 17:10.3 : Inability to Make Blanket Federal Filings17-38
    • § 17:10.4 : Multiplicity of Rights17-38
    • § 17:10.5 : After-Acquired Rights17-39
    • § 17:10.6 : Need for Federal Legislative Solutions17-39
    • § 17:10.7 : Proposals for an International Convention on Intellectual Property Financing17-40
  • Appendix 17A : Patent Security AgreementApp. 17A-1
  • Appendix 17B : Trademark Security AgreementApp. 17B-1
  • Appendix 17C : Copyright Security AgreementApp. 17C-1
Chapter 18: Debtor in Possession Financing; and Appendices 18A-18F
  • § 18:1 : Introduction18-2
  • § 18:2 : Legal Framework for DIP Financing18-4
    • § 18:2.1 : Statutory Provisions18-5
    • § 18:2.2 : Case Law18-9
    • § 18:2.3 : Applicable Rules, Orders, Guidelines, and Procedures18-10
  • § 18:3 : Typical Financing Orders Approved by Courts18-12
  • § 18:4 : Key Issues in DIP Financings18-14
    • § 18:4.1 : Rollup and Cross-Collateralization18-14
    • § 18:4.2 : Use of Cash Collateral Versus DIP Financing18-17
    • § 18:4.3 : Joint Debtors and De Facto Substantive Consolidation18-18
    • § 18:4.4 : Myths and Realities of Priming18-20
    • § 18:4.5 : Section 506(c) Surcharge and Section 552(b) Equities of the Case Waivers18-23
    • § 18:4.6 : Obtaining Requisite Prebankruptcy Lender Consent to Do a DIP18-25
    • § 18:4.7 : Prefiling DIP Commitments18-26
    • § 18:4.8 : Carve-Outs for Professionals and Other Administrative Expenses18-28
    • § 18:4.9 : Avoiding Power Claims and Recoveries As DIP Collateral18-31
    • § 18:4.10 : Ratification of Prebankruptcy Liens or Claims (and Time Limits on Challenging Them)18-32
    • § 18:4.11 : Scope and Automatic Perfection of Postpetition Liens18-33
    • § 18:4.12 : Interim Versus Final Orders18-35
    • § 18:4.13 : Appropriate Findings of Fact in DIP Orders18-37
    • § 18:4.14 : Binding Future Parties18-37
    • § 18:4.15 : Milestones and Credit Bidding18-38
  • § 18:5 : How to Document a DIP Financing18-39
  • Appendix 18A : Statutory Provisions Relevant to Use of Cash Collateral and DIP FinancingApp. 18A-1
  • Appendix 18B : Decisions Regarding DIP FinancingApp. 18B-1
  • Appendix 18C : Federal Rule of Bankruptcy Procedure 4001App. 18C-1
  • Appendix 18D-1 : Sample Interim DIP Financing OrderApp. 18D-1-1
  • Appendix 18D-2 : Sample Final DIP Financing OrderApp. 18D-2-1
  • Appendix 18E : Milestones—363 SaleApp. 18E-1
  • Appendix 18F : Milestones—Plan of ReorganizationApp. 18F-1
Chapter 19: Perfecting Liens Under Select European Laws
  • § 19:1 : Introduction19-4
  • § 19:2 : Granting Security in Italy19-4
    • § 19:2.1 : General19-4
    • § 19:2.2 : Type of Security—Overview19-5
    • § 19:2.3 : Type of Security—Analysis19-5
      • [A] : Land and Buildings19-5
        • [A][1] : Rankings and Registrations19-7
        • [A][2] : Voluntary Mortgages19-7
        • [A][3] : Judicial Mortgages19-8
        • [A][4] : Legal Mortgages19-8
        • [A][5] : Enforcement of the Mortgages19-8
        • [A][6] : Reduction and Extinction of the Mortgages19-9
      • [B] : Moveable Goods19-10
      • [C] : Shares/Quotas19-10
        • [C][1] : Pledge over Shares19-10
        • [C][2] : Pledge over Quotas19-11
    • § 19:2.4 : Bank Accounts19-12
    • § 19:2.5 : Receivables19-13
      • [A] : Assignment of Receivables19-13
      • [B] : Pledge over Receivables19-15
      • [C] : Differences Between the Pledge and the Assignment of Receivables19-15
    • § 19:2.6 : Moveable Goods Taken as a Group19-16
    • § 19:2.7 : Guarantees19-17
      • [A] : Fideiussione19-17
      • [B] : The First Demand (Independent) Guarantee19-18
    • § 19:2.8 : General Overview on Enforcement Proceedings19-19
      • [A] : Enforcement Concerning Real Estate Property19-19
      • [B] : Special Enforcement of Pledge19-19
      • [C] : Enforcement Following Insolvency19-20
      • [D] : Hardening Period and Claw-Back Action19-20
      • [E] : Enforceability of Foreign Decision19-21
    • § 19:2.9 : General Issues19-21
      • [A] : Corporate Interest19-21
      • [B] : Financial Assistance19-22
      • [C] : Priorities19-23
        • [C][1] : Liens19-23
      • [D] : Ranking19-25
  • § 19:3 : Creation of Security in England and Wales19-25
    • § 19:3.1 : Types of Security Interest—General19-25
    • § 19:3.2 : Mortgage19-26
    • § 19:3.3 : Charge19-27
    • § 19:3.4 : Priority19-29
    • § 19:3.5 : Registration19-29
    • § 19:3.6 : Debenture19-29
    • § 19:3.7 : Pensions Regulator19-30
    • § 19:3.8 : Possible Challenges to Security Interests19-31
    • § 19:3.9 : Financial Assistance19-31
  • § 19:4 : Taking Security in France19-32
    • § 19:4.1 : General19-32
    • § 19:4.2 : Reform of French Security Laws19-33
    • § 19:4.3 : Type of Security—Overview19-34
    • § 19:4.4 : Types of Security—Analysis19-35
      • [A] : Land and Buildings19-35
        • [A][1] : Freehold Mortgage (hypothèque conventionnelle)19-36
        • [A][2] : Reloadable Mortgage (hypothèque rechargeable)19-37
        • [A][3] : Freehold Lender’s Lien (privilège du prêteur de deniers)19-37
      • [B] : Moveable Goods19-38
        • [B][1] : Pledge over Tangible Movables19-38
        • [B][2] : Pledge over Tools and Equipment (nantissement du materiel et de l’outillage)19-39
      • [C] : Shares19-39
        • [C][1] : Pledge over Financial Instruments Accounts19-40
        • [C][2] : Pledge over Shares Other than Financial Instruments Accounts19-41
        • [C][3] : Security over Shares Issued by a SARL19-41
        • [C][4] : Security over the Shares Issued by a Société en Nom Collectif19-42
        • [C][5] : Security over Shares Issued by Civil Companies19-42
        • [C][6] : Advantages and Disadvantages19-42
      • [D] : Bank Accounts and Cash Collateral19-43
        • [D][1] : Pledge over Bank Account19-43
        • [D][2] : Pledge of Cash Collateral19-44
      • [E] : Receivables19-44
        • [E][1] : Assignment of Receivables by Way of Security Known as Cession Dailly19-44
        • [E][2] : Pledge over Receivables (Nantissement de Créances)19-45
        • [E][3] : Delegation19-46
      • [F] : Guarantees and Cautionnement19-46
        • [F][1] : Four Categories of Guarantees19-46
        • [F][2] : Cautionnement Personnel19-48
        • [F][3] : Bank Guarantees19-49
      • [G] : Intellectual Property19-49
    • § 19:4.5 : General Issues Relating to Taking Security and Guarantees in France19-50
      • [A] : Banking Monopoly Rules19-50
      • [B] : Corporate Interest19-50
      • [C] : Financial Assistance19-50
      • [D] : Shared Security19-51
      • [E] : Transferability of Loan and Security19-51
      • [F] : Priority Among Creditors19-52
      • [G] : Insolvency19-52
  • § 19:5 : Granting Security in Germany19-54
    • § 19:5.1 : General19-54
    • § 19:5.2 : Types of Security—Overview19-55
    • § 19:5.3 : Types of Security—Analysis19-56
      • [A] : Guarantees19-56
        • [A][1] : Suretyship (Bürgschaft)19-56
        • [A][2] : Guarantee (Garantie)19-57
      • [B] : Security over Shares (Anteilsverpfändung)19-57
        • [B][1] : Formalities and Costs19-58
        • [B][2] : Enforcement19-58
      • [C] : Security over Receivables19-58
        • [C][1] : Assignment of Receivables19-58
          • [C][1][a] : Blanket Assignments19-60
          • [C][1][b] : Realization of Assigned Rights and Receivables19-61
        • [C][2] : Pledge of Receivables19-61
      • [D] : Security over Bank Accounts19-61
      • [E] : Security over Land and Buildings19-62
        • [E][1] : Land Charges (Grundschulden)19-62
        • [E][2] : Mortgages (Hypotheken)19-63
        • [E][3] : Registration Process19-64
        • [E][4] : Costs Incurred upon the Creation of a Land Charge or Mortgage19-64
        • [E][5] : Enforcement of a Land Charge or Mortgage19-65
          • [E][5][a] : Enforcement Procedure19-65
          • [E][5][b] : Costs of Enforcement19-66
          • [E][5][c] : Suspension of Enforcement Proceedings19-66
      • [F] : Security over Intellectual Property19-67
        • [F][1] : Pledge of Right19-67
        • [F][2] : Assignment for Security19-68
        • [F][3] : Trademark Usufruct (Markennießbrauch)19-68
        • [F][4] : Formalities19-69
      • [G] : Security over Personal Property19-69
      • [H] : Security over Aircraft and Ships19-71
        • [H][1] : Security over Aircraft19-71
        • [H][2] : Security over Ships19-72
    • § 19:5.4 : General Issues19-73
      • [A] : Risk of “Over-collateralizing” (Übersicherung)19-73
      • [B] : Corporate Benefit19-74
      • [C] : Financial Assistance19-74
      • [D] : Priority19-74
      • [E] : Insolvency Law19-75
  Table of Authorities
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