Many subscription credit facilities will provide for the issuance of letters of credit in addition to the funding of loans. A letter of credit is an irrevocable undertaking for the payment of money issued by a bank at the...more
The credit agreement for a subscription credit facility will list several conditions precedent that are required prior to the credit agreement becoming effective and/or the first extension of credit occurring thereunder....more
We have said it before – the “credit cornerstone” of a subscription credit facility is the limited partnership agreement (the “LPA”) – it is the primary contract, together with any side letters, governing the relationship...more
Guaranties are a common feature in fund finance transactions. Particularly in NAV loans, upstream and affiliate (or “sideways”) guaranties are used. Below we discuss some of the context for the use of these types of...more
The 2023 edition of the Fund Finance Association’s annual conference was again filled with interesting insights from a wide range of industry participants and leaders. The panel titled “Market Evolution & Industry...more
Following on Mike Mascia’s Closing Remarks delivered to young Fund Finance professionals at last month’s FFA University 1.0, I wanted to take things back to the basics for those who are just starting their careers in fund...more
When we think about parties to a subscription credit facility (the “Facility”), all eyes are generally on the fund and the general partner (the “GP”), but the investment manager (the “Manager”) is also a party to watch. For...more
In the days leading up to the closing of a credit facility, it is not uncommon for the administrative agent to ask each lender a simple question, “do you need a note?” For many lenders, the response is in the affirmative, but...more