When you are advising a client, either on a specific transaction or generally, PPSA may be a very small component of the overall service being provided. PPSA can nevertheless have a critical impact on the client and the transaction. We have experience of working with solicitors on all aspects of PPSA to ensure that the advice your firm provides to its clients translates in to a practical solution that is capable of implementation.
The type of support we can provide is best illustrated by example of assignments EDX has completed:
Specific PPSA advice sought by client. Your firm will provide top quality legal advice on how the client may best protect its interests. This advice needs to be translated in to a set of practical business procedures, an efficient method of registration and registry maintenance and training of operational staff. By working together, we can deliver an “end to end” solution which is in the best interests of your client. A law firm with whom we work closely, won a tender to provide legal services due to our submitting a joint tender which gave the complete solution to both legal and practical registration issues.
- Refinancing proposals. A new financier will always be concerned with PPSA. In a recent refinancing it became apparent (to the solicitor) that its client did not have an effective PPSA management regime in place to protect its interests. We worked with solicitor and client to ensure that everything was brought up to standard before the proposal was released to potential financiers.
- Negotiation of new facilities. The client company operated a large vehicle fleet which was to be the primary security available to the new financier. The challenge was to design a workable registry maintenance framework that allowed the client to buy and sell vehicles within parameters set out in the facility agreement, whilst ensuring the financiers interests were always correctly recorded on PPSR. We worked co-operatively with the solicitors on both sides of the transaction to design a system that met the needs of both parties. In the end, the financier outsourced all registry maintenance to EDX, together with authority to discharge.
- Due diligence on proposed acquisition of new business. If your client is acquiring a business with a substantial debtors or receivables ledger which is secured over assets (of the debtor), then the effectiveness of the PPSA regime that the target business has implemented, will be critical to the due diligence process. Examples of work we have done included (a) Download all security interest registered on PPSR in to a fully searchable database. Use data matching techniques to cross check registrations against the debtors ledger to provide assurance on the degree of cover. (b) Where the security is against motor vehicles, validate the accuracy of VIN number and registration plate against Land Transport Safety Authority records. We can provide exception reports showing the degree of inaccuracy in the registrations database – which typically runs at 25 to 30% of registrations.
- Loan workouts and recapitalisations. If you are advising a client in financial difficulties, or alternatively acting for its bankers it may be critical to the process to have a very clear understanding of the PPSA implications. In a loan workout it may be possible to use PPSA to enhance the position of the secured creditor who is bearing the risk of providing further finance to enable the workout – by structuring support in such a way as to maximise “super priority” positions.
We are able to provide this level of advice and service due to the personally held skills of Kim Powell, a director and shareholder in EDX. Kim is an English qualified Chartered Accountant with experience as an insolvency practitioner in London, Sydney and Auckland. He also headed up the credit recovery function for a major New Zealand bank prior to taking up a senior business banking role.
We would welcome your enquiry and undertake to deliver a level of professionalism that will reflect well on your firm and work in the best interests of your client <enquire now>