Banking and Finance

History and Practice

Banking has been part of the history and practice of Schenck, Price, Smith & King, LLP since the firm's inception in 1912. Throughout its early years, the firm shared its physical location with many prominent banking institutions, and the firm's founding attorneys acted as their general counsels. Architecturally today, original bank vaults serve as the firm's vaults and storage closets and old tellers' cages adorn the library.

Continuing the tradition of our founders, the partners and associates of the Banking and Finance Practice Group represent commercial lenders and borrowers in structuring, negotiating, documenting, and closing all types of secured and unsecured financings. Our attorneys also counsel financial institutions in their capacities as agents and co-lenders in sophisticated multi-bank syndications, as purchasers of participations, as issuers of letters of credit, and as swap counterparties. In addition, members of the Banking and Finance Practice Group advise both lenders and borrowers in all aspects of government guaranteed loans through the United States Small Business Administration and assist clients of the firm to qualify for New Jersey Economic Development Authority loans in situations where traditional financing is not available. Our lawyers also represent both traditional bank and non-bank lenders, as well as borrowers, in asset-based transactions and factoring situations and in acquisition financings.

Each of the members of our Banking and Finance Practice Group has substantial knowledge of the law of secured transactions and the Uniform Commercial Code, real estate and general corporate matters, as well as bankruptcy, insolvency, and lender liability and other litigation issues through first-hand experience with workouts and restructurings of problem credits, deed-in-lieu financings, and foreclosures and collection cases. Attorneys in the group avail themselves of all of the firms' resources by working closely with the firm's environmental, real estate and land use, creditors' rights, litigation, general corporate, and tax, trust and estate attorneys. Such interactions benefit our clients by anticipating and avoiding potential problems, in working through complicated issues, and in providing inventive solutions in their financing transactions. Our broad base of expertise, as well as our keen understanding of the needs of borrowers, allows us to provide high quality, cost-efficient, and effective legal services to our clients in today's "fee sensitive" environment.

Areas of Expertise

• Working capital lines of credit, revolving credit and term loan facilities
• Mortgage loans, construction loans, and mortgage loan review
• Letter of credit and acceptance financings
• Leveraged buyouts and stock/asset acquisitions
• Mezzanine financing
• Asset-based financings and factoring arrangements
• Direct pay letter of credit enhancements
• Swaps and other interest rate hedging agreements
• Syndicated loans and participations
• Foreign exchange transactions
• SBA and EDA financings and bond purchases
• Forbearances, restructurings, workouts
• Deed-in-lieu financings, foreclosures, and collections
• ESOP loans
• Condominium association financings

$52,000,000+ syndicated senior secured credit facilities to a company for working capital, letters of credit, acquisition financing, and mortgage loans, secured by the stock of the company's foreign subsidiaries and by real property

$23,000,000+ syndicated senior secured credit facilities to a non-profit corporation for the construction and operation of a cultural center, secured by pledges donated to the cultural center

$19,000,000+ secured credit facilities to a manufacturing company for working capital and letters of credit and acquisition of equipment, secured by all assets of the company

$60,000,000+ asset-based syndicated senior secured credit facilities to co-borrower manufacturers for working capital, letters of credit, and bankers' acceptances, secured by all assets of the borrowers

$11,400,000 direct pay substitute letter of credit issued by a financial institution to support tax exempt bonds issued by a municipality in Wyoming to provide loan proceeds to a limited partnership to finance a portion of the funds for the acquisition, construction, installation, and equipping of a certain solid waste disposal facility

$8,000,000 direct pay letter of credit issued by a financial institution to support variable rate tax exempt bonds issued by the New Jersey Economic Development Authority to provide loan proceeds to finance the expansion of the facility of a New Jersey not-for-profit corporation

$1,400,000 SBA section 7(a) loan to finance the purchase of restaurant and liquor license, secured by a mortgage on the restaurant, a blanket lien on business assets, guarantees, and a pledge of stock of the entity holding liquor license.

$1,330,000 SBA section 7(a) loan to finance the purchase of a hotel, secured by a mortgage on the hotel, a blanket lien on all business assets, guarantees, and a pledge of stock as collateral

$1,000,000 SBA section 7(a) loan to finance the purchase of a restaurant with a $350,000 piggy-back commercial loan to finance the purchase of liquor license and inventory, secured by mortgages on the restaurant, guarantees, and a pledge of stock of the entity holding liquor license

$1,000,000 SBA section 7(a) loan to purchase a fast food franchise, secured by a blanket lien on all business assets, a leasehold mortgage, ancillary mortgages, and guarantees.

$2,300,000 commercial loan facility consisting of a commercial mortgage loan with a $1,300,000 commercial mortgage bridge loan in connection with an SBA 504 loan, secured by a blanket lien on all business assets, mortgages, guarantees, and a pledge of stock as collateral

$1,280,000 SBA section 7(a) loan to purchase the stock of a corporation owning a bowling alley and liquor license with a $1,520,000 piggy-back loan to finance the commercial real estate, secured by a mortgage on the bowling alley, a blanket lien on all business assets of the corporation, guarantees, and a pledge of stock of the corporation holding the liquor license

$33,000,000 revolving construction loan for a multiple-phase residential development project, together with $14,000,000 mezzanine financing

Representation of a borrower in the financing of the expansion of its manufacturing facility with the proceeds of an $8,000,000 New Jersey Economic Development Authority fixed rate tax exempt economic development bond issue

Representation of a borrower in the financing of the construction and equipping of its new manufacturing facility with the proceeds of a $9,000,000 North Hampton County Pennsylvania Industrial Development Authority floating rate tax exempt economic development bond issue

Representation of a borrower in a $20,000,000 acquisition financing of building sites and the construction of a number of assisted living facilities thereon

Numerous other commercial mortgage, construction and real estate lending transactions for financial institutions and borrowers ranging in dollar amounts from $100,000 to $35,000,000+

For Additional Information Contact Thomas L. Hofstetter