Borrowing Base Certificate Template
Two documents and four sheets that cut the AR rate for dilution and cap inventory at the lesser of cost or appraisal.
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A borrowing base template usually has one advance rate for accounts and one for inventory, then a list of exclusions below them. Real asset-based facilities carry two mechanics that a flat-rate template has nowhere to hold, because both resize the rate itself rather than the balance. One is a dilution trigger that cuts the AR advance rate, point for point, the moment trailing dilution crosses a threshold. The other takes the lesser of a cost-based inventory figure and one built from an appraisal the lender orders on its own schedule.
Cascade Outdoor Supply, a fictional outdoor-gear distributor, certifies against 2,220,000.00 of eligible receivables this period. Trailing dilution, measured from credit memos, rebates and write-offs against gross sales, comes in at 7.4%, 2.4 points over the facility's 5.0% trigger. One filed asset-based facility writes that excess straight into the rate: the advance rate drops from 85.0% to 82.6%, applied to the whole eligible balance rather than to any specific account. The cost is 53,280.00, and it will not appear on the aging, because every invoice behind it is still, individually, eligible.
Inventory runs the same two-track test. Cost basis of 1,600,000.00 at a 60% advance rate reads 960,000.00. Levi Strauss's own asset-based revolver takes the lesser of that figure and a rate against Net Orderly Liquidation Value, a number a field examiner sets from an appraisal rather than the books. This period's appraisal puts NOLV at 68% of cost; the resulting 924,800.00 binds lower, giving up 35,200.00 nobody would find by re-checking the count. A full covenant set alongside a base belongs with the lender reporting package; a clause-by-clause calculation is the covenant definition extractor.
What's in the pack
Eligible AR sheet
Customer-by-customer aging with every invoice-level exclusion resolved to a name and a reason, ending in the pre-dilution eligible balance the rate mechanic applies to.
Eligible Inventory sheet
Cost-basis and appraisal-basis figures side by side, with the binding method named and the last field exam's date carried alongside it.
Ineligibles and Reserves sheet
Every dollar excluded or reserved in one place, including the dilution rate's dollar cost and the cost-versus-NOLV gap stated as their own lines rather than folded into a total.
Availability Summary sheet
The roll-up to Excess Availability, trended across periods so a drifting dilution rate or an aging appraisal is visible before it binds.
Eligibility Rules Note
Every exclusion clause from your facility agreement, plus the exact wording of the dilution trigger and the cost-versus-NOLV test, each with its section number.
Certificate
The instrument itself, in the facility's own format, with both rate mechanics broken out into their own section rather than buried inside the final dollar figure.
How to use it
- 1
Take it blank, or worked
Download the empty Word and CSV files with no signup, or open the pack in River and hand it the facility agreement instead of retyping four sheets.
- 2
Send the agreement first
The Loan and Security Agreement and every amendment. That alone builds the Eligibility Rules Note, including whether your facility has a dilution rate cut or just a reserve, and whether inventory runs the two-calculation test at all.
- 3
Add the aging and the appraisal
The receivables aging, the inventory report, and the most recent field exam letter if inventory is part of your collateral. Both rate mechanics get computed from these.
- 4
Roll up and certify
Availability Summary carries the roll-up to Excess Availability. Your own Responsible Officer signs the Certificate.
Frequently asked questions
Is this template free?
Yes. The whole pack comes down as Word documents and CSV sheets, no signup and no card. Edit with AI is the optional route for anyone who would rather hand River the facility agreement than retype four sheets. The rest of the library is at free templates.
Does every asset-based facility cut the advance rate for dilution?
No, and that is exactly why the clause has to be read rather than assumed. Some facilities reserve a dollar amount against dilution instead. One filed facility writes the rate-reduction version explicitly: the advance rate itself drops by the percentage points dilution exceeds the trigger. Read your own Section 1.01 before assuming either convention.
What is Net Orderly Liquidation Value, and why does it matter here?
It is what a field examiner's appraisal says the inventory would fetch in an orderly liquidation, not what the books say it cost. Levi Strauss's asset-based revolver takes the lesser of a cost-based figure and an NOLV-based figure. The appraisal, not the general ledger, can end up binding the inventory component.
How often does the NOLV appraisal need to be refreshed?
Whatever your facility's own clause says, and it is worth finding, because a lapsed appraisal usually drops inventory to a lower default advance rate automatically. The Eligibility Rules Note carries the interval and the expiry date once your agreement is read. Missing that date is treated the same as a missed covenant deadline.
Does it handle the ordinary exclusions too, like aging and foreign accounts?
Yes, on the Eligible AR and Eligible Inventory sheets, each resolved to a named customer or category. The two rate mechanics get their own sheet, Ineligibles and Reserves, so a dilution-driven rate cut is never confused with a specific invoice being excluded.
How does this sit alongside a facility with a full covenant set?
The lender reporting package is built for a facility that also tests leverage or fixed charge coverage, with a borrowing base as one collateral sheet among several. This pack is scoped to a facility where the base is the whole relationship, and it goes deeper on the two rate mechanics than a combined package has room for.
What if a clause in my agreement reads differently from the worked example?
Send the exact section and it gets read on its own words rather than mapped onto this example's convention. Dilution clauses and NOLV clauses both vary facility to facility, which is the whole reason a flat-rate template cannot hold either one correctly.
Certify the base your facility actually defines
Download the blank pack as Word and CSV files, or open it in River and let the agent build the Eligibility Rules Note from your own facility agreement.
Edit with AI