Borrowing Base Certificate (BBC) & ABL Calculator
Model Asset-Based Lending (ABL) availability, eligible accounts receivable, inventory NOLV advance rates, dilution reserves, and springing cash dominion triggers.
Collateral & Facility Parameters
Availability & Dominion Analytics
Adequate AvailabilityBorrowing Base Assessment
The borrower maintains comfortable liquidity headroom. Excess availability represents 21.8% of the facility commitment, well above the 12.5% springing dominion threshold.
| Collateral Asset Line | Gross ($M) | Ineligible ($M) | Advance % | Net Contribution ($M) |
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Sensitivity Matrix: Ineligible A/R ($M) vs. Inventory NOLV Factor (%)
Evaluates net excess availability ($M) across variations in receivables collateral quality and inventory liquidation appraisal values.
Asset-Based Lending (ABL) & Borrowing Base Quiz
Frequently Asked Questions
What is an Asset-Based Lending (ABL) borrowing base?
An ABL borrowing base is a formula-driven collateral calculation that determines the maximum revolving credit loan availability for a commercial borrower. It is derived by applying agreed advance rates to eligible working capital assets—primarily accounts receivable (typically 80% to 85%) and eligible inventory valued at Net Orderly Liquidation Value (NOLV, typically 85% of NOLV)—minus administrative and dilution reserves.
What are common ineligible accounts receivable in a borrowing base certificate?
Lenders exclude high-risk receivables from eligible collateral, including: invoices past due over 90 days from invoice date (or 60 days past due), cross-aged accounts (if over 50% of an obligor's balance is delinquent, all invoices from that debtor become ineligible), customer concentration exceeding 15% to 20%, contra accounts (potential offsets where borrower owes the customer), foreign receivables, and affiliate receivables.
How does Net Orderly Liquidation Value (NOLV) apply to inventory advance rates?
Rather than lending against raw cost or book value, ABL lenders hire independent appraisal firms to determine Net Orderly Liquidation Value (NOLV)—the estimated net cash realized in a professional orderly wind-down over 60 to 90 days, net of liquidation expenses. Lenders then advance typically 85% of NOLV, subject to an overall cap (such as 65% of lower of cost or market).
What is springing cash dominion in revolving credit agreements?
Springing cash dominion is a protective credit agreement clause that activates when a borrower's excess availability falls below a contractual threshold (typically 10% to 12.5% of the total commitment, or a fixed dollar amount). Once triggered, the lender assumes full control of the borrower's collection deposit accounts (blocked accounts) and automatically sweeps all daily customer cash receipts to pay down outstanding revolver balances.