Structuring Agreements Among Lenders in Unitranche Loan Facilities; Enforcement in Bankruptcy

Tranching, Payment Waterfalls, Interest and Fees, Voting, Buyouts, Standstill and Assignment Provisions

Recording of a 90-minute CLE webinar with Q&A


Conducted on Thursday, November 30, 2017

Recorded event now available

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Program Materials

This CLE webinar will discuss structuring and negotiating key terms of the agreement among lenders (AAL) in a unitranche facility, focusing on tranching, payment waterfalls, interest and fees skims, voting, buyouts, remedial standstill, and assignments. The program will also discuss latest developments in enforceability of AALs in bankruptcy and other bankruptcy-related risks.

Description

The unitranche loan facility is provided under a single credit agreement, has a single set of security documents, and is typically administered by a single agent for the lenders. The document binding the lenders in a unitranche loan facility is the AAL. The unique structure of the unitranche facility and the AAL raises issues that lender’s counsel must understand when negotiating the terms and provisions of the AAL.

Open questions regarding enforcement of AALs in bankruptcy include plan classification and voting, adequate protection, and the lender’s entitlement to post-petition interest. Lender’s counsel must understand the structures in the market today and the AAL issues associated with these transactions.

Listen as our authoritative panel of finance counsel guides you through the current market terms of the AAL in a unitranche facility, including tranching, payment waterfalls, interest and fees skims, voting, buyouts, remedial standstill, and assignments. The panel will also look at latest developments in enforceability of AALs in bankruptcy and other bankruptcy-related risks.

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Outline

  1. Structuring key provisions of AALs
    1. Tranching
    2. Payment waterfalls
    3. Interest and fees skims
    4. Voting
    5. Buyouts
    6. Remedial standstill
    7. Assignments
  2. Enforceability of AALs in bankruptcy and bankruptcy-related risks
    1. Recent case law developments
    2. Subordination
    3. Post-petition interest
    4. Credit bid provisions
    5. Plan classification

Benefits

The panel will review these and other key issues:

  • Market terms and trends for AALs
  • Latest case law developments in enforceability of AALs in bankruptcy
  • Differences in AALs for asset-based versus cash flow facilities
  • Considerations in negotiating “split lien” AALs

Faculty

Garcia, Danielle
Danielle V. Garcia

Partner
Holland & Knight

Ms. Garcia focuses her practice on representing lenders in secured finance transactions, including senior, second lien...  |  Read More

McIlwain, Brent
Brent R. McIlwain

Partner
Holland & Knight

Mr. McIlwain practices in the area of Corporate Finance and Litigation, with a particular emphasis on bankruptcy and...  |  Read More

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