THE LENDER'S GUIDE TO SECOND-LIEN FINANCING.

The article discusses about second-lien financing. According to the article, second-lien financing, or tranche B loans presents a number of benefits for the borrower. It is said that second-lien loan transactions ensure quick access to additional liquidity on relatively flexible and cost-effective conditions that allows prepayment as funds became usable through positive operating performance. It also provides an equity-like rate of return but still allow priority secured creditor status to mitigate risk. The article also provides information about the kinds of subordination and some of the common terms contained in intercreditor agreements as well as, bankruptcy issues entailed in financing agreements.