ABL Forbearance Packages: The 13-Week Cash Flow and Borrowing Base Support Lenders Expect

By the time a borrower asks an asset based lending (ABL) lender for relief — a covenant waiver, a structural amendment, or a forbearance — the decision is rarely made on the strength of the ask. It is made on the strength of the package behind the ask. A borrower who walks in with a clean 13-week cash flow, a borrowing base roll-forward, and a credible availability bridge is treated as a partner in a problem. A borrower who walks in with a narrative and a number is treated as a risk to be managed down.

I have spent five decades inside ABL, including the workout cycles of the early 1990s, 2001, 2008-09, and 2020. I wrote Asset Based Lending Disciplines, the first textbook in the field, and trained more than 5,000 lenders, examiners, and underwriters at GE Capital, JP Morgan Chase, Lloyds, and Barclays. The 2021 SFNet Hall of Fame induction reflected that body of work. This article is the companion to our covenant breach playbook: that piece covers the lender's response menu; this one covers the package you build to influence which item gets pulled.

Why the package — not the ask — drives the outcome

When a credit moves from the relationship desk to the workout group, the people reading your materials change. Workout officers are measured on minimizing loss, not on growing the relationship. They read your submission the way a field examiner reads a borrowing base certificate — looking for the gap between what you say and what the numbers support. The faster they can reconcile your forecast to your collateral, the faster they can get comfortable enough to stand down.

That means the burden is on you to make reconciliation easy. Three documents do most of that work: a 13-week cash flow, a borrowing base roll-forward, and an availability bridge that ties the two together. Everything else in the package supports those three.

The 13-week cash flow: the document the workout desk reads first

The 13-week cash flow forecast (often called the "13-week" or the TWCF) is the single most important document in any forbearance or waiver submission. It is the lender's window into whether the business can fund itself through the relief period without tripping into a liquidity crisis the relief was supposed to prevent.

A credible 13-week has weekly granularity and separates the line items the lender cares about most:

• Operating receipts built bottom-up from the AR aging and historical collection curves — not a top-down percentage of sales. The workout desk will tie your projected receipts to the aging you submit; if they do not reconcile, the whole forecast loses credibility.
• Operating disbursements broken into payroll, critical vendors, rent, utilities, and discretionary spend — with the discretionary line clearly identified as the lever you can pull in a downside week.
• Debt service including revolver interest, term loan amortization, and any default interest the forbearance will add.
• Capital expenditures, separated into maintenance (non-deferrable) and growth (deferrable).
• Revolver activity — draws and paydowns — so the forecast shows the projected revolver balance and the projected availability week by week.
• Ending cash and ending availability for every week, with the binding constraint (the tightest week) flagged explicitly.

Build a base case and a downside case. The downside should stress the two variables that actually move in a distressed ABL credit: slower collections (extend the collection curve by 10 to 15 days) and a tightening borrowing base (lower advance rates or higher reserves following a field exam). A forecast that only shows the base case tells the workout desk you have not thought about what happens if the plan slips — which is exactly the scenario they are paid to worry about.

The borrowing base roll-forward: proving availability is real

The 13-week shows cash. The borrowing base roll-forward shows collateral. In a workout, the lender assumes both are deteriorating, and your job is to show how fast — and where it stops. A roll-forward walks the eligible collateral and availability forward week by week, starting from the most recent certified borrowing base:

• Beginning eligible AR and inventory
• Plus new sales / production
• Less collections and shipments
• Less projected ineligibles (cross-aging, concentration, disputes — the same cascade we walked through in our ineligible calculations article)
• Less reserves (dilution, slow-pay, landlord, and any new workout reserves — see our reserves negotiation guide)
• Equals projected availability

The roll-forward is also where you get ahead of the field exam. In a workout, the lender will almost always order one, and the findings — see our field exam findings article — frequently tighten eligibility. A borrower who has already modeled those adjustments into the roll-forward looks prepared; a borrower who is surprised by them looks like they did not understand their own collateral. If you have never been through one, our field exam preparation playbook covers what to expect. The discipline of reading what you submit — covered in our borrowing base certificate walkthrough — is the same discipline that produces a defensible roll-forward.

The availability bridge: tying cash to collateral

The availability bridge is the document that connects the two. It explains, in plain terms, the path from today's availability to the relief period's tightest week and back out. Most ABL relief situations are not covenant problems at all — they are excess availability problems, where availability has fallen toward the springing covenant trigger covered in our springing FCCR article. The bridge should show, week by week, how close availability runs to that trigger and what management actions (collections acceleration, vendor stretch, an equity contribution, an asset sale) keep it above the line.

The forbearance support package: a practical checklist

Here is the package we help borrowers assemble before they sit down with a workout desk. Not every item applies to every situation, but a lender reviewing a relief request will look for most of them.

Component	What the lender is looking for
13-week cash flow (base + downside)	Weekly receipts, disbursements, debt service, ending cash and availability; binding-constraint week flagged
Borrowing base roll-forward	Eligible AR/inventory walked forward weekly, with projected ineligibles and reserves
Availability bridge	Path from current availability to tightest week and back, relative to the springing trigger
AR aging detail	Current aging by customer, tied to the receipts assumptions in the 13-week
Inventory appraisal / reserve support	Most recent NOLV appraisal and any category-level reserve rationale
Covenant / default timeline	What was breached, when, the cushion at the prior test, and projected test dates
Vendor / payroll / tax priority schedule	Who must be paid to keep operating, ranked; trade payables aging
Customer concentration analysis	Top-customer exposure and any at-risk relationships behind the deterioration
Root-cause analysis	Quantified, specific explanation of what drove the breach — no euphemism
The specific ask	Waiver, amendment, or forbearance; terms; concessions offered; duration
Milestones	Refinancing target, asset sale, capital raise, or return-to-compliance date with dates
Reporting cadence	Proposed frequency of BBCs, 13-week refreshes, and management calls during relief

Reporting cadence: the concession that costs little and buys trust

In nearly every relief situation, the lender will ask for more frequent reporting — weekly borrowing base certificates instead of monthly, a 13-week refreshed every week against actuals, and a standing management call. Borrowers sometimes resist this as a burden. That is the wrong instinct. Offering enhanced reporting before the lender demands it is one of the cheapest concessions available and one of the most effective at building the trust that gets a forbearance extended when a milestone slips. The variance report — actual versus forecast, refreshed weekly — is what tells the workout desk whether your forecast is reliable. A borrower who hits their 13-week within a tight variance for three or four weeks has earned credibility that no narrative can buy.

Milestones: the spine of a forbearance

A forbearance is not a pause; it is a runway with a destination. The milestones define the destination. Common milestone sets include a refinancing track (deliver a term sheet by a date, close by a later date — see our term sheet comparison guide and refinancing playbook), an asset sale track, a capital raise, or a return-to-compliance track. If the situation is severe enough that a refinance or sale is the realistic exit, the borrower should be running that track transparently in parallel with the incumbent — and the package for alternative lenders is built from the same 13-week and roll-forward. For the most distressed cases, where the exit may run through a court-supervised process, our DIP financing article covers what comes next, and our turnaround and distressed ABL article covers how lenders underwrite these credits.

Three mistakes that sink a relief request

1. A top-down 13-week. A forecast that projects receipts as a percentage of sales rather than building them off the AR aging will not reconcile to the collateral, and the workout desk will discount the entire submission. Build receipts bottom-up.

2. No downside case. A single-scenario forecast signals that the borrower has not stress-tested the plan. The downside case is where you demonstrate you understand your own risk — and it is where you pre-empt the lender's first question.

3. Asking for relief without offering concessions. Enhanced reporting, a fee, a tighter borrowing base, milestones with teeth — these are the currency of a relief negotiation. A borrower who asks for a six-month forbearance and offers nothing in return has not made a proposal; they have made a wish.

What we do at Don Clarke Enterprises

We are an independent ABL advisor and loan placement consultant. We do not lend, fund, broker, or guarantee facilities, and final credit and funding decisions are always made by the lender. In a relief situation, our role is to help borrowers build the package the workout desk needs to say yes: the 13-week cash flow in lender format, the borrowing base roll-forward, the availability bridge, the root-cause analysis, and the specific waiver, amendment, or forbearance proposal with milestones and reporting cadence. When refinancing is the right exit, we package the deal for introduction to alternative lenders. We do not represent the borrower in a legal capacity at the workout table — that is for counsel — and we do not negotiate term sheets on the borrower's behalf.

The depth this draws from is unusual: five decades inside ABL, the textbook, the training of the credit and workout officers who staff the major ABL platforms today, and the parallel field-exam practice at ABLC that gives us a continuous read on how lenders are evaluating distressed borrowers right now. For our full positioning, see the services and process sections.

The bottom line

When you ask an ABL lender for relief, you are not asking them to take your word for it — you are asking them to underwrite a runway. The 13-week cash flow, the borrowing base roll-forward, and the availability bridge are the underwriting. Build them well, build them honestly, refresh them against actuals, and you give the workout desk every reason to stand down rather than accelerate. Build them poorly, and you hand the lender the pen.