Revolver Loan

A revolver loan allows you to borrow, repay and reborrow funds as needed for the life of the loan.

Advance Rates

  • Individually crafted asset-based lending advance rates against accounts receivable and inventory (finished goods, eligible raw materials and/or eligible work in process)
  • Inventory sublimit as appropriate for certain industries (may increase and decrease due to seasonal swings)
  • Underwriting criteria provide for stability of collateral valuations and mix that can be underwritten and controlled structurally through discretionary advance rates, reserves and ineligibles

Collateral Monitoring

  • Monitored on an asset-based borrowing base at least monthly
  • Field examinations at least annually
  • Typically requires an individually tailored financial covenant package tracked on a monthly or quarterly basis
  • Dominion of funds or springing dominion

Operating Performance

  • Debt service coverage test

Excess Loan Availability

  • Reasonable average excess loan availability
  • Adequate excess borrowing base availability provides for:
    • Normal working capital fluctuations
    • Seasonal swings (accommodates seasonal secured over formula advances through step-ups and step-downs in advance rates)