Herrick’s Subscription Lending Practice is well established and respected in the market. We bring extensive experience on both the lender and borrower sides of the deal, resulting in a sophisticated practice well versed in all aspects of subscription lending and one that is able to anticipate the needs of our clients.
For Lenders
We focus on working with mid-sized lenders to identify the current needs of their program and assist in achieving their strategic business goals. We specialize both in working with lenders in the initial stages of creating a subscription lending program and with experienced lenders looking to improve the efficiency, costs or quality of their existing program. Our business-centered, practical focus and hands-on approach by senior attorneys put the lender’s day-to-day concerns at the forefront of our advice and work product.
We advise on all facets of capital call facilities through a deep understanding of a wide variety of fund structures and market documentation. We have a sophisticated knowledge of the complex tax and ERISA issues funds face and how a capital call facility can be structured with respect to those issues. Our extensive experience also affords us familiarity with a wide range of issues specific to investors in funds obtaining subscription loans and enables us to give our lending clients practical, realistic advice with respect to those issues.
For Borrowers
Herrick attorneys also have experience working on the borrower’s side of subscription lending and have detailed knowledge of lender requirements which enables our clients to focus on the big picture. In the initial stages, we can assist borrowers with lender requirements for partnership agreement language and advise on sensitive investor issues in order to ensure investor relationships are preserved while lender standards are met. We are able to offer practical business advice when a fund is comparing financing alternatives in the market and are happy to help funds find the right lender for their business needs. Our ongoing advice regarding transaction documents through the closing process is thorough, practical and efficient in order to attain the results our clients are seeking while keeping negotiation friction to a minimum. Our real estate, corporate, funds and tax experience create a value add for borrowers looking to add a subscription loan option to their financing alternatives.
Creating Value for our Clients
Herrick’s Subscription Lending Team offers clients full-service advice through the life cycle of the transaction and beyond. We assist clients by providing practical educational resources, including roundtable discussions, on topics which may pose recurring challenges for subscription lending origination teams and the credit and legal teams who support them. We cover topics such as fund authority issues, enforceability of capital call obligations and the legal value of common investor waivers, available defenses of investors to capital calls, sovereign immunity of governmental investors, MAE provisions in a subscription loan context, and ongoing challenges posed by ever-evolving standards of partnership agreements and side letters.