Structuring Margin Financing for Private Equity Funds: Securities as Collateral, Margin Calls and Cures, Registration Issues
Recording of a 90-minute premium CLE video webinar with Q&A
This CLE webinar will examine margin loan facilities where securities are pledged as collateral. The panel will discuss the pros and cons of margin loan financing for private equity sponsors, the key terms and structural components of margin loan facilities, the mechanics of margin calls and cures, and day-to-day facility maintenance issues.
- Reasons behind the use of margin loan financing; benefits for private fund sponsors
- Types of securities pledged as collateral
- Valuation and LTV covenants
- Methods of perfection
- SPV borrower
- Regulation U
- Mechanics of a margin facility
- Issues with restricted shares
- Mandatory prepayments
- Release of collateral
The panel will review these and other relevant issues:
- When is it advantageous for a private equity sponsor to seek margin financing in connection with other PE financing?
- What are the methods of perfection when the loan collateral is securities?
- How is LTV determined when pledged securities are not publicly traded?
- How are margin calls made, and how are they cured, in a margin credit facility?
LeAnn L. Chen
Haynes and Boone
Ms. Chen represents banks, multinational corporations, hedge funds, mutual funds, private equity funds, and... | Read More
Ms. Chen represents banks, multinational corporations, hedge funds, mutual funds, private equity funds, and broker-dealers in a wide range of business transactions, including syndicated financing, cross-border investments, margin lending, prime brokerage, swap transactions, securitizations, and DIP financing, etc. She regularly advises clients on issues related to secured transactions, securities credit regulations, and cross-border investments.Close
Craig S. Unterberg
Haynes and Boone
Mr. Unterberg concentrates his practice in the areas of representing borrowers and lenders in secured and... | Read More
Mr. Unterberg concentrates his practice in the areas of representing borrowers and lenders in secured and unsecured lending and structured finance transactions, including margin stock lending, private equity and hedge fund financing, syndicated financings, mergers and acquisition financings, and distressed debt transactions. In addition, he provides extensive regulatory advice on margin lending issues.Close