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The Three Factors That Determine Whether a Financing Arrangement Is a Loan Under New York Law
Under New York law, whether a financing arrangement is a loan depends on its substance rather than its label. Courts generally evaluate three factors: (1) whether the agreement contains a meaningful reconciliation provision tied to actual revenue, (2) whether it lacks a finite term or fixed repayment schedule, and (3) whether the funder lacks recourse in the event of bankruptcy.

Jeffrey Haber
3 hours ago8 min read
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