ABF Journal, January/February 2006
January/February 2006

Background Investigations…
When Danger Lurks

Features

When Danger Lurks…

Background Investigations Take on Greater Significance in ABL Deals
by Larry Scherzer, Scherzer International

Major asset-based lenders along with prominent public corporations, law and accounting firms, investment bankers, M&A firms and venture capital groups have employed background investigations for years — but until now, only on a selective basis.
(Ref # FRD013)

Dangerous Curves Ahead?

Opportunities Still Abound in the Automotive Industry
By John Landefeld, GMAC Automotive Group

GMAC’s John Landefeld says the industry and its traditions are going to experience significant changes. He also predicts that there will be plenty of opportunities for suppliers who recognize the pitfalls and prepare appropriately to grow and prosper. (Ref # IND072)

2006 CFO Outlook:

A Survey of What Manufacturing Chiefs Expect

By Jeff Wilson, Bank of America Business Capital

According to the eighth annual survey of mid-size and large U.S. manufacturing company CFOs commissioned by Bank of America Business Capital, while many are optimistic about the prospects for their own companies, CFOs are concerned about economic expansion and growth opportunities for the manufacturing sector in 2006.(Ref # GEN009)

Some Advice We Learned as Scouts…

Preparation Essential to Risk Management
By Lee A. Diercks, Clear Thinking Group LLC

No matter which of the sophisticated risk management tools asset-based lenders employ, loan defaults still occur at varying levels each year. Fortunately, proper preparation can reverse this trend. (Ref # CRD021)

UCC Insurance vs. Credit Insurance —

A Look at Two Risk-Shifting Alternatives for Lenders

By James D. Prendergast, the First American Corporation

This article discusses the similarities and differences between credit insurance and UCC insurance. How and when to use credit insurance or UCC insurance can be a complex decision process, as both serve very different purposes and are significantly different in terms of cost. (Ref # INS011)

Plan Confirmation & Cram Down…

Life After Armstrong World Bankruptcy
By Lesley Anne Hawes, Frandzel Robins Bloom & Csato, L.C.

The Armstrong World case illustrates that predicting how a court will apply the Bankruptcy Code’s complex confirmation standards can be difficult and uncertain and creates another factor that must be weighed in negotiating Chapter 11 plans. (Ref # BANK016, LGL052)
Columns

A PROFILE OF SUCCESS
NewStar Financial: Capitalizing on Unmet Needs in the Middle Market
As consolidation within the banking industry continues, many middle-market borrowers have needs that are too large for their local banks yet not big enough for larger banks. The need to serve this under-attended market has quickly been recognized and leveraged by NewStar Financial, a specialty finance company in Boston.
(Ref # COMP015)

TURNAROUND CORNER
When Risk Becomes Reality —

Applying a Framework of Cs to Help Manage During a Crisis
By William J. Hass, TeamWork Technologies, Inc. and

Shepherd G. Pryor IV

Business crises come in all shapes and sizes — from a simple everyday customer crisis, to an employee’s personal crisis, to a complete market collapse. In the case of New Orleans and the Katrina disaster, all forms of these individual crises arrived on the same day. (Ref # CRD022, TM049)

LEGAL EYES

Focusing on Knowledge-Based Assets…

IPR Lending & Security in England (Part II)
By Neil James, Partner, Winston & Strawn LLP

In Part II of this two-part series, Neil James of Winston & Strawn’s London office considers why and how value can be ascribed to intellectual property rights; how the structuring of a deal can enhance the value of IPR and more… (Ref # INTL027, LGL053)

A CLOSER LOOK

Inventory Turnover & Astrophysics…

A Not So “Out of This World” Analogy
By Joseph R. Caplan, Clear Choice Seminars, Inc.

While this article is about the theory behind what we think is reasonable for inventory holding periods, it pokes some holes in conventional wisdom.
This intergalactic journey starts with an average as a baseline. (Ref # FIELD009)