Borrowing Base

Question 1

The Facility Amount

Answer 1

the total available commitment offered by the lender under the facility (i.e size of the revolving line)

Question 2

Total Advances Outstanding

Answer 2

the total amount borrowed from the lender which hasn’t been repaid

Question 3

The Advance Rate

Answer 3

the percentage of the value of the loan that a lender is willing to advance (also called Applicable Percentage)

Question 4

The Minimum Equity Amount

Answer 4

the required minimum invested by the borrower to purchase the loans

Question 5

Unfunded Exposure Equity Shortfall

Answer 5

any shortfall in the portion of the unfunded commitments associated with all delayed draw or revolver loans which the borrower is responsible for funding

Question 6

Individual Loan Characteristics

Answer 6

such as the par balance and the Assigned Value, a value assigned to the loan by the Admin Agent at their discretion

Question 7

Principal Account Balance

Answer 7

the current balance of the principal collections in the principal account

Question 8

Process for verifying Borrowing Base when there is an Advance Request

Answer 8

1.) Funding Notice
2.) Borrowing Base Certificate
3.) Loan Approval Notice
4.) Borrowing Base Calculations