Banking law

Cash is the life-blood of any business. Overcoming the legal hurdles of a finance transaction can ensure it stays healthy.

In the most general sense, banking transactions document two critical points. First, who is receiving cash, and how? Second, when it is to be repaid, and what if it is not?

Gilson Gray advises both borrowers and lenders on the legal issues that arise from such questions.

Banking and finance matters include:-

1. General Corporate Lending

This is lending to facilitate the day to day cash needs of a business, including:

– Overdrafts and business loans, whether for business cash-flow or project finance
– Invoice factoring or discounting, where a lender provides cash against a sales ledger
– Asset finance, lease hire and hire purchase agreements, to fund equipment and plant acquisition

2. Contract and Risk Finance

 This is specialised finance to support the performance of contracts, or the mitigation of risk between supplier and customer. Examples include:

– Performance bonds, where cash is paid if a contract is not fulfilled
– Letters of credit, where a party to a contract arranges for their bank to make payments on their behalf, usually if specified conditions are met.

3. Securities

Securities are formal documents giving a debtor the right to recover assets from their creditor. We advise on all securities, including:-

– Standard securities (mortgages), over buildings
– Floating charges, over stock and moveable items
– Pledges, over specified assets (such as pledges of shares)
– Company debentures

4. Specialised banking services

Gilson Gray also advises on specialised banking transactions, including:-

– Refinancing and recapitalisation, where old lending is replaced by new
– Mezzanine Finance, where debt can be convert to an ownership or equity interest in the borrower
– Redeemable Shares, where shares are involved in lending and are repaid (“redeemed”) in set circumstances
– Debt Acquisition
– Subordination, where debt and securities are ranked among creditors
– Senior lien and bridging, where short term finance is used to cover gaps in other funding

For More Information Contact:
Derek Hamill
Mobile: 0797 392 4333
Direct Dial: 0141 530 2022