2021 Leveraged Loan Market Trends; MFNs, PetSmart, Lien Amendments

More recently than ever, the success rates for lenders to push back against terms in their agreements or to push for the inclusion of others have increased. 2021 leveraged loan market trends have taken a turn to benefit lenders, plus some terms that used to be considered aggressive are becoming more and more familiar in these amendments. Our Americas Covenants team analyzes and reviews some of the most prominent 2021 leveraged loan market trends emphasizing the fact that these are exceptions to the rule. 

First, the team discusses the most favored nations (MFN) protection where lenders have been trying to break down the strength of this protection agreement in terms of pricing differences, length and scope. Next, our Americas Covenants team takes a look at the anti-PetSmart guarantor protections where guarantors and liens on assets could be released in an easy manner creating credit agreement provisions that include the block of the release of guarantors. Further in the article, our team discusses provisions to erroneous payments as a result of the Revlon and Citibank mistaken wire transfer, transfers to unrestricted subsidiaries, and a few other provisions that are becoming increasingly more common including earlier maturing debt, debt using restricted payment capacity and more. Read our Americas Covenants team’s full analysis of the 2021 leveraged loan market trends here: https://reorg.com/leveraged-loan-market-trends/