Prepayment Structures in Leveraged Finance: Balancing Borrower Flexibility With Lender Protections
Debt Retirement Provisions in Syndicated, Mezzanine and Second Lien Term Loans
Recording of a 90-minute premium CLE webinar with Q&A
This CLE course will analyze the prepayment features of syndicated, mezzanine and second lien term loans. The panel will discuss provisions currently used in each type of loan to balance the borrower’s need for flexibility in future operations with the lender’s need for call protection and preserving the value of the credit.
Outline
- Debt retirement provisions generally—concerns of borrower and lender(s)
- Prepayment triggers
- Excess cash flow provisions
- Voluntary prepayments
- Call protection and “soft call” provisions
- Comparison of syndicated, mezzanine and second lien prepayment structures
Benefits
The panel will review these and other key issues:
- How do prepayment restrictions and triggers benefit lenders and how do they hamper a borrower’s business operations?
- How might call protection provisions vary between syndicated, mezzanine and second lien loans?
- What are some of the variations on the calculation of excess cash flow and when should it be applied to reduce the loan balance?
Faculty
Alison R. Manzer
Partner
Cassels Brock & Blackwell
Ms. Manzer is a member of the Firm's Financial Services Group. Her practice encompasses a broad range of commercial... | Read More
Ms. Manzer is a member of the Firm's Financial Services Group. Her practice encompasses a broad range of commercial practice in the financial services sector, including financial institution regulation, corporate and commercial lending, asset-based financing, securitization and structured finance, private equity, project finance, asset finance and leasing, business reorganization, syndicated lending and related areas. A significant part of her practice involves multi-jurisdiction transactions where she has expertise in the structuring requirements of financing, investment and securitization transactions to solve taxation, conflicts of laws, document structure, currency and rate issues, among others.
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Timothy R. Ryan
Partner
Holland & Knight
Mr. Ryan is a highly experienced financial services attorney who has an extensive background in representing clients in... | Read More
Mr. Ryan is a highly experienced financial services attorney who has an extensive background in representing clients in the structuring, negotiation, documentation, and closing of a broad variety of lending and financing transactions. He represents lenders and arrangers in international and domestic syndicated, club and single-lender transactions. His practice extends to acquisition financings, recapitalizations, high-grade and junior debt financings, cash flow, and asset-based and other capital market transactions. In addition, he also regularly represents clients in workouts and restructurings of troubled credits.
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Vanessa G. Spiro
Partner
K&L Gates
Ms. Spiro is a member of the firm's banking & asset finance practice group. She has substantial experience in... | Read More
Ms. Spiro is a member of the firm's banking & asset finance practice group. She has substantial experience in leveraged finance and represents financial institutions and other creditor entities and borrowers (corporates, sponsors and other capital end-users) in connection with acquisition financings, cash flow and asset-based transactions and other finance matters. She also has significant experience in restructurings, workouts, distressed debt matters and debtor-in possession and exit financings.
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