Structuring Real Estate Loan Covenants, Event of Default Provisions, and Representations and Warranties

Drafting Loan Provisions that Balance Borrower Protections With Lender Remedies

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


Conducted on Tuesday, April 24, 2018

Recorded event now available

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Program Materials

This CLE webinar will instruct borrowers’ and lenders’ counsel on structuring default provisions, representations and warranties, affirmative and negative covenants, and other provisions in commercial real estate loan documents. The panel will discuss the most recent trends and best practices.

Description

Strategically crafted loan documents give flexibility to the borrower and adequate protections and remedies for the lender. Carefully structured loan provisions can minimize disputes between the parties and reduce the risk of suit.

Default clauses must be carefully constructed to distinguish between a default and an event of default. Grace periods and notice and ability to cure defaults are particularly crucial to borrowers.

Affirmative and negative covenants are often among the most hotly negotiated provisions in a loan transaction. Financial covenants in real estate investment finance deals are more tightly monitored and defined in the current market than before the financial crisis.

Although property representations and warranties will vary among transactions, there are standard representations found in most loan agreements. There are also limitations (such as best knowledge) that borrowers seek to negotiate regarding the scope of representations and warranties.

Listen as our authoritative panel of real estate finance attorneys offers practical approaches for borrowers’ and lenders’ counsel for structuring loan covenants, event-of-default provisions, representations and warranties, and other loan provisions.

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Outline

  1. Loan covenants
    1. Affirmative
    2. Negative
    3. Financial
  2. Default provisions
    1. Cross-default
    2. Insolvency-related events
    3. Due on sale; change of control
    4. Material adverse change
  3. Reps and warranties
    1. Regarding the borrower
    2. Regarding property
    3. Other

Benefits

The panel will review these and other critical issues:

  • What are borrowers’ and lenders’ best tactics for mitigating risk when negotiating and drafting financial covenants?
  • What financial covenants do lenders insist are included?
  • How can the borrower and lender each minimize risk when drafting or relying on default provisions?
  • What are the standard property representations found in most facility agreements and what limitations do borrowers typically seek concerning representations?

Faculty

Ung, Euchung
Euchung Ung

Partner
Kleinberg Kaplan Wolff & Cohen

Mr. Ung primarily represents real estate investors, owners and lenders in partnership, LLC and joint venture...  |  Read More

Bordy, Michael
Michael J. Bordy

Principal
Michael J. Bordy, A.P.L.C.

Mr. Bordy is a transactional attorney who has 26 years of experience handling a variety of issues in business,...  |  Read More

Other Formats
— Anytime, Anywhere

Strafford will process CLE credit for one person on each recording. All formats include program handouts. To find out which recorded format will provide the best CLE option, select your state:

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