• videocam Live Webinar with Live Q&A
  • calendar_month October 1, 2026 @ 1:00 PM ET/10:00 AM PT
  • signal_cellular_alt Intermediate
  • card_travel Banking and Commercial Finance
  • schedule 90 minutes

Structuring Credit Facilities for Private Equity Funds: Subscription, NAV, and Hybrid Loans

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About the Course

Introduction

This CLE course will provide finance counsel with the tools to structure credit facilities for private equity funds, including subscription and net asset value (NAV) based facilities and hybrids that combine aspects of both. The panel will contrast the documentation and collateral for subscription vs. NAV loans and review additional issues to address when underwriting and documenting a hybrid transaction.

Description

Private equity funds often use subscription-backed credit facilities as a bridge to capital calls or to other permanent or asset-level financing. As funds mature beyond their investment or commitment periods, they then seek NAV credit facilities with availability based on the underlying portfolio investments of the fund.

These two phases of financing have historically been distinct transactions, but borrowers and lenders are now exploring hybrid facilities which provide lenders with recourse to both uncalled capital commitments (the typical collateral under subscription facilities) and underlying investment assets (the traditional credit support under NAV facilities). Counsel must have a thorough understanding of subscription and NAV credit facilities, and how each may figure into a hybrid structure.

Hybrid facility lenders need to underwrite the investors providing collateral support and a pool of known and potentially unknown portfolio assets. The collateral package for the hybrid facility might include pledges of a general partner's rights to unfunded capital commitments; deposit accounts into which the fund's investors are required to fund their contributions; equity interests in the holding companies through which the fund holds its underlying investments; and equity interests relating to the underlying investments.

Listen as our authoritative panel discusses the different objectives of subscription and NAV credit facilities and the nuances of combining the two into a hybrid credit facility. The panel will also address UCC perfection issues concerning the various interests pledged.

Presented By

Darin Schmalz
Senior Director, Corporate Credit Funds
KBRA Holdings, LLC

Mr. Schmalz is a Senior Director within the Corporate Credit Funds team at KBRA. He focuses on ratings and analytical assessments of private credit funds, direct lending vehicles, feeder fund notes, and other alternative investment structures. Prior to joining KBRA, Mr. Schmalz was a portfolio manager within the asset management group at Antares Capital, where he managed various senior debt investment strategies. Previously, he led structured credit and fund initiatives at Maranon Capital. Earlier in his career, Mr. Schmalz held senior underwriting and investment roles at CapitalSource Finance and JPMorgan Securities and worked at Fitch Ratings, where he specialized in corporate credit and structured finance. He received a Bachelor of Arts degree from the University of Notre Dame and an MBA from DePaul University’s Kellstadt Graduate School of Business.

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Jan Sysel
Partner
A&O Shearman

Mr. Sysel has extensive experience representing sponsors, borrowers, arrangers, and lenders across the full range of products in fund finance and adjacent financing transactions. He advises clients on structuring, negotiating, documenting, and executing a broad spectrum of financings, including syndicated senior facilities, mezzanine facilities, and private debt placements. Mr. Sysel’s work spans unsecured and secured facilities with a particular focus on fund subscription, NAV and hybrid facilities, management company facilities, employee loan programs and other forms of investment fund leverage, as well as related transactions including back-leverage, rated note funds, collateralized fund obligations and, other securitized fund assets and bespoke structured financings. Mr. Sysel currently serves on the Fund Finance Association (FFA) U.S. Advisory Council, and he frequently speaks at FFA and other industry conferences. 

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Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.


  • Live Online


    On Demand

Date + Time

  • event

    Thursday, October 1, 2026

  • schedule

    1:00 PM ET/10:00 AM PT

I. Financing lifecycle of a private equity fund

II. Subscription facilities

III. NAV facilities

IV. Hybrid facilities

V. Types of collateral: UCC perfection

The panel will review these and other key issues:

  • What is the collateral for subscription facilities, and when are they most useful in the life of the fund?
  • When should NAV facilities be created, and how are adjustments made for underlying assets of a fund?
  • How should a hybrid facility be structured to address both subscription and NAV underwriting?
  • What are the UCC considerations for each type of collateral?