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Understanding Venture Debt vs. Traditional Debt: Key Disparities and Strategic Considerations
July 25th, 2024
Introduction In recent years, venture debt has emerged as a significant financing option for startups, alongside conventional forms of debt financing such as bank loans and credit lines. Although both types of debt provide capital, they cater to diff…
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Categories: Insights
Legal Scale’s 2024 Annual Networking Event
June 25th, 2024
Our annual client event was unforgettable this year! We enjoyed the company of many clients and friends at a fantastic rooftop gathering. Special thanks to New York State Senator Zellnor Myrie for joining us. We sincerely appreciate all attendees for…
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Categories: News
Intercreditor Agreements
December 7th, 2023
Intercreditor agreements are legal contracts that outline the rights and relationships between different classes of lenders who have a claim on the same borrower’s assets. These agreements are crucial in complex financing structures, such as th…
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Categories: News
Borrowing Base Components
November 29th, 2023
A borrowing base sets the maximum amount that a borrower can access through an asset-based loan. Borrowers and lenders negotiate the calculation of the borrowing base by determining the value of different types of collateral (such as cash, accounts r…
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Categories: News
Financial Covenants: Debt to EBITDA Ratio
November 15th, 2023
Financial covenants are used as a tool for lenders to measure a borrower’s health and to test their ability to incur additional debt. Borrowers and lenders alike negotiate financial covenants to ensure it works both for the company’s ability to r…
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Categories: News
Common Mistakes to Avoid When Filing UCC Financing Statements: A Guide for Lenders and Borrowers
November 10th, 2023
In the world of commercial lending, securing debt financing is a crucial aspect of business operations. Uniform Commercial Code (“UCC”) financing statements play a vital role in this process, serving as a legal document filed by a lender to secur…
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Categories: News
Credit Agreement Amendments
November 8th, 2023
We are seeing many credit agreements being amended within today’s market. Most of these amendments are centered around the rising interest rates in the economy and macroeconomic changes. While many amendments in the recent market have been focused…
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Categories: News
Original Issue Discount
November 1st, 2023
Original Issue Discount (or “OID”) can dramatically change the cost of capital when borrowing from a lender. Lenders could charge a fee on each issuance of debt under their facility, which would ultimately lower the net proceeds received by a bor…
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Categories: News
Legal Scale Named to 2024 Best Lawyers: Ones to Watch® in America
September 14th, 2023
Legal Scale is pleased to announce that we have been included in the 2024 edition of Best Lawyers: Ones to Watch® in America, with special recognition of Neil ODonnell. See our profile on the Best Lawyers website. About Best Lawyers Best Lawyers is…
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Categories: News
Secured and Unsecured Loans and Priority of Liens
October 28th, 2022
Introduction Businesses have many debt financing options available to them in order to obtain a loan. In most financings, a borrower receives money in exchange for the payment of interest to the lender as well as other consideration (including provid…
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Categories: News