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November/December 2004

Vol. 2 No. 10
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ABF Journal, November/December 2004
November/December 2004

Deal Structures in 2005 –
The Shape of Things to Come

As Investors Yearn for Flavorful ABL Structures, Borrowers Demand “Vanilla” Deals
By Anthony Foti

This year, the asset-based loan market is dominated less by the infusion of new money and more by portfolio refinancings and amendments that support increased working capital needs and – to a lesser degree – acquisitions and recapitalizations. At the end of the day, this activity has not produced a sufficient supply of ABL paper in 2004, leaving many investors hungry for more.

(Ref # IND057)

What You Should Know About Appraisal Values In a Changing World Economy
By Robert Maroney Over the past several years, driven by the economy and increased globalization, the appraisal industry has undergone numerous changes. Lenders and borrowers need to be aware of these changes as they’ve had a substantial influence on the appraised value of inventory, equipment and other assets used to secure debt.
(Ref # APP021)

More Than a Finger on the Pulse…

A Framework for Pricing Credit Risk
By Michael J. Bedore

Many executives who looked so capable during the good times now face a challenge they have never seen before or been trained to handle – building profitable businesses in an adverse environment. Therefore, today’s managers would be wise to think like turnaround professionals
because the gap between a healthy and an underperforming company is very narrow.
(Ref # CRD017)

Who Knows What Lurks in Unexpressed Terms?

Confronting the Impacts of Phantom — Article 2
By Michael Ullman

Article 9 of the UCC governs most sales of accounts and security interests and the factor or lender must acquire a working knowledge of these laws in order to attain perfection of rights and prevail over all others who try to take a superior position over accounts. But your perfected lien in the accounts is only as strong as the proverbial chain made of steel links and one or more of those links may be weaker than you think.
(Ref # LGL036)

Just Do More: Trade Finance Companies Provide Flexible Solutions
By Joseph Ingrassia

Potential borrowers whose sales are under $10 million per annum do not typically have access to banks or finance companies because they may be experiencing rapid growth beyond their equity and may lack the proper credit to borrow on the basis of their own credit or balance sheet. Instead of traditional lending options, these borrowers can look to the structure of trade financing as a growing alternative when they are looking to “do more” now.
(Ref # FAC041)

Forget the Article 9 Folklore…The Exact Debtor Name May Not Be Enough
By James D. Prendergast

Is that a light we see at the end of the tunnel or warning signs of a derailment? For our last issue of 2004, Thomas Siska of assembled a quartet of factoring industry veterans from both coasts to sound off on what they see on the tracks ahead.
(Ref # LGL037)


The Fast Path to Excellence… Trimming the Fat Through Lean Manufacturing
By Fred Langer

When addressing problems at a distressed or Chapter 11 firm, the turnaround professional is frequently called upon to help streamline operations, enhance cash flow and, if possible, return the firm to profitability. For the asset-based lender, an understanding of lean manufacturing principles can provide a new and powerful lens through which to view a manufacturer’s operations, and an enhanced appreciation for some of the steps that the manufacturer-debtor might need to take to improve them. (Ref # TM030)

A Profile of Success: Hitting One Out of the Park…
Providing Value Through Relationship-Oriented Financing for Small to Mid-Sized Businesses
By Bert Colianni

Although two very unlikely sisters, Marquette Financial Companies and the Minnesota Twins ball club share one common vision- they strive to win. And surprisingly enough, Marquette Financial identifies its “sweet spot” as deals in the $1 million to $5 million range proving that consistently hitting a base hit can sometimes mean more than the occasional grand slam.
(Ref # COMP008)

Priority Defeated By Ambiguity of Subordination Clause
By Mark G. Douglas, Esq.

Sophisticated lending transactions routinely involve documentation that
appears to account for every circumstance and contingency that could conceivably impact the relationship among borrowers, lenders, the loaned funds and any security serving as collateral. Still, lending agreements sometimes prove to be inadequate or incomplete due to either inartful drafting or simple oversight.
(Ref # LGL038)

Around the Bend… Will Factoring Come Alive In 2005?
By Thomas G. Siska

Is that a light we see at the end of the tunnel or warning signs of a derailment? For our last issue of 2004, Thomas Siska of
assembled a quartet of factoring industry veterans from both coasts to sound off on what they see on the tracks ahead.
(Ref # FAC040)

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