Articles

As we make it to week seven of the coronavirus pandemic, it is hard not to reflect on this incredible period in history. The pandemic and the associated COVID-19 virus are an enigma that is bringing the world economy seemingly to its knees. First the virus was dismissed by the Western world as a mere flu-like illness originating in Asia, then an epidemic that might disrupt the Chinese economy, then an Italian problem, a cruise ship issue, a Washington state complication, and a New York dilemma. Now, it has finally been recognized for the major world concern that it is. The coronavirus has erupted into a global pandemic with over three million cases that will likely have a global and possibly U.S. pandemic-related death toll second only to the Spanish flu of 1918. We already know that this pandemic will have the greatest impact on the global economy since perhaps the bubonic plague of 1342, also known as the Black Death.

FOCUS

If you seek tranquility, do less. Or (more accurately) do what’s essential. Do less, better. Because most of what we do or say is not essential

  -- Marcus Aurelius

Lenders (and most others) struggle with a particular problem almost every day: how to prioritize deals they can get done versus those they can’t. Prioritization affects all of us, but how practically can we focus on what is essential? We are living beings and our most important asset is time, so let’s use it wisely. But how do we know if we are using it sensibly?  Seneca similarly stated,

It is not that we have a short time to live, but that we waste a lot of it

Granted, he was referencing our lives and not lending, but the lesson still applies. What is essential in lending?  To be successful in lending one only to needs consider duration – safety – return and contingencies (perhaps a subset of safety).

FSW Funding, a Phoenix-based company specializing in financing solutions for small to mid-size businesses, recently hired Griffin Augustniak as a Portfolio Analyst and Cynthia Klein as a Business Development Officer. Both help support FSW’s continued growth and expansion in the Midwest and East. Augustniak is based in Chicago, Illinois and Klein is based in Jacksonville, Florida.

I was a lender for over 40 years and have been a member of SFNet for most of that time.   I have attended many conferences over the years.  I especially enjoy the SFNet Annual Convention.   A different city every year, an opportunity to catch up with all the people I know in the industry, but haven’t seen in a while, and an opportunity to meet lots of new people that I didn’t know or only knew by telephone or e-mail.   When I was a lender, our syndications group would arrange a lot of meetings with existing and potential new partners and very often was able to pitch new deals.   This was a time to solidify relationships, expand your professional and personal network and maybe get some business done.  For years, I never came home from the convention without at least one new potential deal to review.   And, of course, there were always exceptional keynote speakers and terrific panels to attend as well. 

Axiom Bank, N.A., a Maitland-based, leading community bank, recently expanded its factoring and asset-based lending division with the hiring of Mark J. Simshauser as SVP of Allied Affiliated Funding.

Based on Long Island, NY, Simshauser will be responsible for expanding Allied and Axiom’s existing commercial portfolio by working with business owners and centers of influence throughout the Northeast to find solutions that meet their individual financial needs. 

CIT Group Inc. (NYSE: CIT) today announced that its Healthcare Finance business served as sole lead arranger of senior debt financing aggregating $48 million for the acquisition of a portfolio of medical office buildings.

The borrower is a joint venture between Kayne Anderson Real Estate and Remedy Medical Properties. The portfolio properties are located in four states and collectively total more than 189,000 square feet. 

LBC Small Cap, an affiliate of LBC Credit Partners, provided a senior secured term loan and equity co-investment to support the acquisition of Auchinachie by Astar Heating & Air ("Astar"), a portfolio company of Dubin Clark & Company ("Dubin Clark").

Gerber Finance, the leading finance partner for companies experiencing accelerated growth, today announced the completion of their CEO succession strategy, naming longtime President Jennifer Palmer as CEO with Founder Gerald Joseph transitioning to his new role as strategic advisor and Chairman of the Board.

The Merchant Opportunities Fund, a Vancouver-based diversified credit opportunities fund focused on prudently compounding capital over the long-term, today announced that it has closed a revolving debt facility with the Bank of Montreal ("BMO"). The facility consists of a $15 million funding commitment with a two-year term along with a $12.5 million accordion.

The Merchant Opportunities Fund invests in well-selected proprietary specialty finance portfolios, that in many cases consist of loans or advances that are originated, underwritten, and serviced by their primary originator, Merchant Growth. The BMO debt facility specifically provides funding for the Merchant Growth portfolio.

Second Avenue Capital Partners, LLC (“SACP”) (www.secondavecp.com) announced it has closed on a $17,000,000 senior secured credit facility to Crown & Caliber, an online marketplace leader in authenticated pre-owned luxury watches. The credit facility will be used to support growth opportunities and provide additional working capital.

White Oak Commercial Finance, LLC (“White Oak”), an affiliate of White Oak Global Advisors, LLC, announced it provided a $50 million asset-based revolving credit facility to a leading, athletic footwear and apparel retailer based in the U.S. 

The retailer recently activated a roll-up of several brands led by a private equity firm, and the transaction was structured with advances against the company’s inventory, accounts receivable, and intellectual property. The proceeds will be used to refinance existing debt and provide for ongoing working capital needs.

Hamid Namazie is managing partner of McGuireWoods’ Los Angeles - Downtown office. He concentrates his practice on representing a wide range of clients, including banks, institutional lenders and commercial finance companies, providing asset-based loans.

When a creditor, whose debtor filed for bankruptcy relief, sought adequate protection payments as a secured creditor, his status as a secured creditor was challenged by an Official Committee of Unsecured Creditors. Based upon filing errors he had committed, he was declared an unsecured creditor of the estate.  Official Committee of Unsecured Creditors of Rancher’s Legacy Meat Co. v. Ratliff, 616 B.R. 532 (Bankr. D. Minn. March 23, 2020).

This case points out the critical importance of familiarity with subsequent events that can make a UCC filing seriously misleading, what to do to avoid its characterization as seriously misleading, and within what time period, so as to prevent later continuation statements to be ineffective and cause the supposed secured creditor to be deemed unsecured.

SPONSORED CONTENT