Why you should attend
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 use their own assets to generate cash flow.
In structuring these loans, lenders and their counsel must consider all senior interests in the collateral, as well as the practical difficulties in obtaining payment in enforcement situations. Accordingly, asset-based lending requires not only a sound knowledge of the law, 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 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
- Enforcement and bankruptcy planning strategies
- Recent UCC Article 9 developments including 2010 amendments
- Cross-border asset based financing issues
Who should attend
The program is intended for attorneys and asset-based lenders already experienced in the field or seeking a general refresher or update. The program will review the basics of asset-based lending briefly before concentrating on more advanced issues and strategies.
Morning Session: 9:00 a.m. - 12:30 p.m.
9:00 Introduction and Opening Remarks
- The asset-based lending market
- The importance of a security interest
- Brief review of the UCC Article 9 definitions and the basics of attachment, perfection and priority of a security interest
- Focus on more advance issues including cross-border issues
Edwin E. Smith
9:15 Equipment Financing Issues
- Brief review of common equipment financing structures including leasing
- Issues involving perfection by filing
- Stumbling blocks in obtaining purchase-money equipment priority
- When to do a fixture filing
- Exploring common equipment financing provisions in asset-based financing agreements
- Foreign equipment collateral
R. Marshall Grodner, Christine Gould Hamm, Scott A. Lessne
10:15 Networking Break
10:30 Inventory Financing Issues
- Brief review of common inventory financing structures including floor plan financing and consignments
- Issues involving after-acquired property
- Stumbling blocks in obtaining purchase-money inventory priority
- Common mistakes involving consignments
- Exploring common inventory financing provisions in asset-based financing agreements
- Foreign inventory or inventory in cross-border air or freight shipments
R. Marshall Grodner, Christine Gould Hamm, Scott A. Lessne
11:30 Receivables Financing
- Brief review of common receivables financing structures including factoring
- Steps to maintain proceeds security interests
- Commonly negotiated provisions in deposit account control agreements and lock box arrangements
- Review of rights and obligations of account debtors affecting receivables financings
- Exploring common receivables financing provisions in asset-based financing agreements
- Foreign account debtors
Scott A. Lessne
12:30 Lunch Break
Afternoon Session: 1:45 p.m. - 5:00 p.m.
1:45 Priority and Enforcement Issues
- Accounting for non-UCC liens and statutory trusts
- Commonly negotiated issues in subordination and intercreditor agreements
- Minimizing “lender liability” risks in exercising UCC remedies
Joanne De Silva, Edwin E. Smith
2:45 Networking Break
3:00 Bankruptcy - Hot Issues for Secured Creditors
- Automatic stay
- Post-petition interest and attorneys’ fees
- Executory contracts
- Post-petition financing
- Bankruptcy trustee avoiding powers
- Credit bidding
- “Cram down” and “cram up”
June L. Basden, Edwin E. Smith
4:00 Ethics in Asset-Based Lending
- Common ethical problems in asset-based lending transactions
- Special issues in multi-lender transactions
- Ethical issues in opinion letter practice
Christine Gould Hamm, Edwin E. Smith
New York City Seminar Location
PLI New York Center, 810 Seventh Avenue at 53rd Street (21st floor), New York, New York 10019. Message Center, program days only: (212) 824-5733.
New York City Hotel Accommodations
The New York Hilton & Towers
1335 Avenue of the Americas, New York, NY 10019. 1 block from PLI Center. Reservations 1-800-HILTONS or, 1-877-NYC-HILT. Please mention that you are booking a room under the Practising Law Institute Corporate rate and the Client File # is 0495741. You can also make reservations
online to access Practising Law Institute rates.
The Warwick New York Hotel, 65 West 54th Street New York, NY 10019. 1 block from PLI Center. Reservations 800-223-4099 or, hotel direct 212-247-2700. Please mention that you are booking a room under the Practising Law Institute Corporate rate. Reservations on line at www.warwickhotelny.com Click reservations in menu bar on left. Select desired dates. In 'Special Rates' drop down window select Corporate Rate. In 'Rate Code' enter PLIN. Click search and select desired room type and rate plan. Or, you may email reservation requests to: firstname.lastname@example.org
Sheraton New York Hotel & Towers
, 811 7th Avenue, New York, NY 10019, 1-800-325-3535 or (212) 581-1000. When calling, please mention Practising Law Institute and mention SET#311155. You may also book online
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