NORWAY Law and Practice Contributed by: Ida Marie Windrup, Kristine Hjertenæs, Markus Nilssen and Daniel Jovanovic, BAHR
tions and for a certain period of time, except in the case of an insolvency event. In the Nordic market, it is not uncommon that the senior credi- tor group is given the right to instruct enforce- ment, ahead of the super senior creditors; how- ever, this may be subject to certain enforcement principles such that the proceeds shall be suf- ficient to ensure complete discharge of the super senior liabilities. 4.2 Bank/Bond Deals While there is a rise in issuance of junior bonds in combination with senior bank financing in the Nordic high-yield bond market compared to previously, bank/bond deals are more common in asset financing than in acquisition financing, where they are less frequently seen. However, there may be an increasing trend where Nordic high-yield bonds will play a part in acquisition finance structures. In this context – although not specifically related to acquisition financing – it is worth noting that combined bank- and bond- financings are being documented on a platform basis with a common terms structure, with the very first of its kind in Norway in 2023. 4.3 Role of Hedge Counterparties Most commonly, hedge counterparties will be secured, typically sharing in the security pack- age, but ranking behind the senior creditors in the waterfall. 5. Security 5.1 Types of Security Commonly Used Shares In acquisition financings, the security pack- age will most commonly include a charge of the shares in the target and its material sub- sidiaries, which charges are perfected by way of notice to the company whose shares have
been charged. The parties will typically have pre-agreed enforcement procedures to ensure swift enforcement of the shares either by way of appropriation or a pre-agreed sales process. Floating Charges: Inventory, Operating Assets and Trade Receivables Under Norwegian law, there is not a concept of floating charges covering all assets owned by a debtor from time to time. However, charges over certain specific asset classes with the same effect as typical floating charges, is allowed, including the debtor’s inventory, trade receiva- bles, operating assets, motor vehicles and con- struction machinery, in each case outstanding from time to time. Floating charges are perfected by way of registering a standardised charge form with the Norwegian Register of Mortgaged Mov- able Property. With respect to acquisition financing, such float- ing charge security covering inventory, trade receivables and/or operating assets will usually be provided by the target companies. As for inventory, the floating shall, at the outset, cover the chargor’s inventory in its entirety (or, alterna- tively a separate part thereof which is operation- ally separate from the rest and appears as an independent unit). Intellectual Property Rights (IP Rights) Intellectual property rights are considered as the operating assets of the chargor and may thus form part of a floating charge. This is the most common, however, an intellectual property right in itself may also be granted as security, and fixed charges may be established over specific patents effective in Norway, as well as trade marks.
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