The following Banking & Finance practice note provides comprehensive and up to date legal information covering:
Cash flow benefits for lessee— the operating cash flow of the lessee is likely to be in a stronger position than under a typical loan structure as the lessee will be able to benefit from the use of the asset that it requires without having to incur a large capital expenditure up-front in order to purchase the asset. The asset will be paid for by the lessee from the revenue that it earns in operating the asset. The cost of the asset will be more equally spread across the useful economic life of the asset with smaller lease payments which clearly aids the cash flow of the lessee
Tax advantages—the lessor will acquire the asset and can benefit from capital allowances in respect of this purchase. In addition, the lessee will also benefit as this saving will be passed down to them in the form of reduced monthly rental rates
Improved security position for finance provider—under an asset finance transaction, the finance provider will be in a better security position than under a typical loan structure as it will be the legal owner of the asset rather than simply a chargeholder. As a result of this stronger security position, they are likely to provide more flexible financing structures and, potentially, higher levels of funding to the lessee
Greater certainty for lessee—a typical asset
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This Practice Note discusses Term Loan B (TLB) facilities which frequently appear as a tranche of senior facilities in syndicated loans in leveraged financings. TLBs are an established feature in the US market and increasingly used in the European lending market for institutional investors.This
Source of the doctrine of the separation of powersThe origins of the doctrine are often traced to John Locke’s Second Treatise of Government (1689), in which he identified the 'executive' and 'legislative' powers as needing to be separate.‘… it may be too great a temptation to human frailty, apt to
For guidance on the basic features of the doctrine of estoppel and the different classifications it has been subject to, see Practice Note: Estoppel—what, when and how to plead and related content.Promissory estoppel—what is it?Where A has, by words or conduct, made to B a clear and unequivocal
Brexit: The UK's departure from the EU on exit day ie Friday 31 January 2020 has implications for practitioners dealing with provisions in the CPR relevant to cross border matters, including CPR 5.4C (discussed below). For guidance on the impact of Brexit on the CPR, see Cross border
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