ERISA Considerations in Structuring Credit Facilities with Private Investment Funds
Representations, Warranties and Covenants to Ensure Compliance
Recording of a 90-minute premium CLE webinar with Q&A
This CLE course will outline ERISA considerations for lenders providing subscription and other credit facilities to private investment funds that have pension funds, retirement plans and other ERISA-regulated entities as investors. The panel discussion will include descriptions of the representations and warranties and other provisions to include in loan documents.
- Background: ERISA and related tax provisions
- ERISA prohibited transaction rules
- Plan asset rules
- Less than 25% exception
- Operating company exception
- Timing considerations
- Prohibited transaction exemptions for plan asset funds
- QPAM exemption
- Servicer provider exemption
- Controlled Group Liability
- Addressing ERISA when providing a credit facility
- Due diligence
- Representations and covenants to include in loan documents
- Guaranties, recourse obligations
The panel will review these and other relevant issues:
- Why is ERISA of particular concern when funds are seeking financing through subscription facilities?
- How should exceptions to the plan asset rule be documented by the borrower?
- What are the prohibited transaction exemptions available to plan asset funds?
- What representations and covenants should be included in credit facility documents to protect the lender?
Todd N. Bundrant
Mr. Bundrant is a partner in Mayer Brown’s Banking & Finance practice. He represents financial institutions,... | Read More
Mr. Bundrant is a partner in Mayer Brown’s Banking & Finance practice. He represents financial institutions, investment funds and corporate borrowers in a variety of secured and unsecured finance transactions. He has extensive experience representing both borrowers and lenders in transactions involving corporations, private equity funds, credit funds and other alternative lenders seeking to expand and/or leverage their portfolios.Close
Ms. Gosker is a partner in Mayer Brown's Chicago office and a member of the ERISA Fiduciary and Fund Formation... | Read More
Ms. Gosker is a partner in Mayer Brown's Chicago office and a member of the ERISA Fiduciary and Fund Formation & Investment Management practices. She has a particular focus in the pension investment area, representing sponsors of private real estate funds that are offered to institutional investors, including benefit plan investors and governmental plans. In these matters she handles the ERISA aspects of the structuring and formation of the fund, including negotiating with the prospective investors regarding their ERISA-related comments to the fund documents. She also helps the fund sponsors to structure the underlying investments of the fund so that the fund may rely on these investments to qualify for exceptions to holding plan assets under ERISA.Close
Cecilia A. Roth
Ms. Roth advises corporate clients regarding all aspects of ERISA, employee benefit plans and executive compensation.... | Read More
Ms. Roth advises corporate clients regarding all aspects of ERISA, employee benefit plans and executive compensation. She represents plan sponsors of various sizes and organizational structures in administrative and compliance matters with the Internal Revenue Service, the Department of Labor and the Pension Benefit Guaranty Corporation. She also advises clients with respect to employee benefit plans in corporate transactions and lending transactions.Close