A common area of focus in LMA-based fund finance (and other) facilities in Europe is on the trigger point for acceleration of a facility and/or enforcement of security following the occurrence of an event of default. In LMA documentation, however, the question of when and how to deal with events of default is dealt with in two different places and the two provisions are not consistent with each other.
The Alternative Reference Rates Committee recently provided recommended contractual fallback language for U.S. dollar LIBOR-denominated floating rate notes and syndicated loans.
- Signature Bank seeks to add a Relationship Specialist in its growing Fund Banking Division.
- National Australia Bank is seeking an Associate to join its New York-based Fund Finance team.
- Cadwalader seeks to add qualified attorneys to our Fund Finance practice.
Here are updates to our Fund Finance Calendar.
We can pack in some serious substance on a Friday (not necessarily everyone’s peak time for absorbing a nuanced discussion on complex financial products). Here’s a recap of original substantive pieces from recent issues for easy reference.
The subscription facility market has for ages included an event of default trigger tied to a certain percentage threshold of investors failing to timely fund their capital calls. We illustrate the link between such a Cumulative Default EOD threshold and an overcall limit in the LPA, and how the overcall limit should inform the appropriate Cumulative Default EOD percentage.
Traditionally, subscription finance facilities treat investors in two ways. For “regular” investors, they are either included or excluded from the borrowing base or leverage covenants depending on their financial status and/or their behaviour as investors. For investors which are also GPs or managers, the concerns are more around a change of control of the GP or manager or something worse (for example, a voluntary or even compulsory removal of a GP or manger and whether there is an acceptable replacement). But what happens where the investor (including the GP or manager) is not itself a substantive entity and is simply a vehicle for and reliant on another entity?
Emma Wallace has joined Silicon Valley Bank as a Managing Director in its Global Fund Banking Group.
- Signature Bank seeks to add a Relationship Specialist in its growing Fund Banking Division.
- National Australia Bank is seeking an Associate to join its New York-based Fund Finance team.
- Cadwalader seeks to add qualified attorneys to our Fund Finance practice.
The Fund Finance Association’s Next Generation initiative announced a May 15 event in New York.