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Contract Terms Credit Agreements

Goulston & Storrs PC

Rethinking Liability Management in Club Deals and Direct Lending: Lessons from the Fifth Circuit’s Serta Ruling and Beyond

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On December 31, 2024, the Fifth Circuit Court of Appeals (the “Court”) struck down the controversial 2020 “uptier transaction” executed by Serta Simmons Bedding (“Serta”). The Serta case and several other state court and...more

Cadwalader, Wickersham & Taft LLP

Debt by Design, June 2025 - Permitted Indebtedness

Before a subscription lender can enter into a subscription credit facility with a fund, the subscription lender will need to review the limited partnership agreement (“LPA”) of such fund to confirm the LPA allows for...more

Proskauer Rose LLP

Private Credit Deep Dives – What to do following an Event of Default in a consensual setting (Europe)

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Over the past year, we have seen a significant increase in Events of Default (each, an “EoD”) arising from financial underperformance. This trend is largely driven by the high interest rate and inflationary environment, with...more

Cadwalader, Wickersham & Taft LLP

From Big Ben to the Big Apple, June 2025 - Westminster Meets Wall Street: U.S. Law Considerations in English Law Facilities...

Fund finance is and always has been by nature a cross border enterprise. While there are a number of lenders that we represent in the United States that lend to funds exclusively organized in the U.S.– typically in Delaware –...more

WilmerHale

Serta’s (Un)Surprising Take on Equitable Mootness

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In its New Year’s Eve decision in Serta Simmons Bedding, the Fifth Circuit underscored the importance of drafting debt documents with clarity and precision and cautioned against borrowers’ reliance on ambiguous language to...more

Mayer Brown

Participations in the Fund Finance Market

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EXECUTIVE SUMMARY - Participations are increasingly being utilized in the finance industry, serving as a mechanism for lenders to manage credit exposure, diversify loan portfolios, optimize capital utilization, and...more

Cadwalader, Wickersham & Taft LLP

From Mistake to Misconduct, April 2025 - Beyond the Boilerplate

The term “boilerplate” originates from the printing industry, where “boilerplate” referred to metal plates with standardized text used for newspapers and other publications. In legal documents and contracts, boilerplate...more

Morrison & Foerster LLP

Latest Uptier Decisions in Serta and Mitel Remind Contract Language Matters

The caselaw on “uptiers” as liability management exercises (LMEs) grew by two opinions on the last day of 2024. In Serta, the Fifth Circuit reversed the bankruptcy court’s blessing of the pre-bankruptcy uptier and...more

Holland & Knight LLP

A Tale of 2 Rulings: Serta, Mitel Cases Remind Why Contract Language Matters in Debt Documents

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A three-judge panel of the U.S. Court of Appeals for the Fifth Circuit has unanimously held that the debt exchange undertaken by Serta Simmons Bedding did not qualify as an "open market purchase" under the terms of Serta's...more

Stikeman Elliott LLP

Business Impacts of Québec’s Proposed Consumer Protection Reforms: Consumer Credit Limits, Grocery Price Displays, Point-of-Sale...

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Bill 72, An Act to protect consumers against abusive commercial practices and to offer better transparency with respect to prices and credit, was recently tabled by the Québec government. This legislation includes amendments...more

Cadwalader, Wickersham & Taft LLP

Subscription Agreements 101 – Back to Basics July 2024 - Subscription Agreements

We have said it before – the “credit cornerstone” of a subscription credit facility is the limited partnership agreement (the “LPA”) – it is the primary contract, together with any side letters, governing the relationship...more

Latham & Watkins LLP

Texas Bankruptcy Court Approves Serta Simmons “Uptier” Transaction

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The ruling, which held that the transaction did not violate the implied covenant of good faith and fair dealing, highlights the importance of carefully drafting lending documents. On June 6, 2023, Judge David Jones of the...more

Cadwalader, Wickersham & Taft LLP

Forbear and Move Forward April 2023 - Forbearance Agreements: Bringing the Deal Parties Together

During times of market disruption and economic uncertainty, the representations and covenants set forth in a credit agreement play an even more important role in the ongoing relationship among the loan parties and lenders....more

Moore & Van Allen PLLC

Special Situations Client Bulletin - Quick Guide to Credit Document Transfer Provisions for Loan Purchasers

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Credit documentation transfer provisions, which may in the past have been viewed as rather boilerplate, have increasingly become points of contention in the documentation process. Today these provisions are often highly...more

Cadwalader, Wickersham & Taft LLP

Let the Games Begin July 2021 | Issue No. 136 - Revlon: It’s Worth a Double Take (Part II: Borrower Considerations)

In last week’s edition of FFF, we discussed the Revlon case involving an erroneous payment by an administrative agent to the syndicate lenders, which is currently up on appeal before the Second Circuit Court of Appeals....more

Emmet, Marvin & Martin LLP

COVID-19 AND THE LAW: MAC/MAE Clauses in New York Credit Agreements

With the COVID-19 pandemic continuing to adversely impact businesses across the globe, for the past year lenders have been reviewing their portfolios for credit degradation. Credit agreements will often contain a clause in...more

Cadwalader, Wickersham & Taft LLP

An Interpretation of ‘Discharge for Value’

As most in the loan market are by now aware, the United States District Court in the Southern District of New York issued a decision on February 16, 2021 In Re Citibank August 11, 2020 Wire Transfers that certain lenders were...more

WilmerHale

COVID-19: Credit Agreement Provisions to Consider in Light of the COVID-19 Outbreak

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Uncertainty over the scope and spread of the COVID-19 outbreak continues to negatively impact the domestic and worldwide economy. Disruptions to business as a result of stay-at-home or shelter-in-place orders, restrictions on...more

Carlton Fields

COVID-19 and Credit Facilities

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Due to the COVID-19 pandemic and its uncertain impact on business operations and business continuity, many companies are reviewing their credit agreements with an eye toward their ability to borrow/re-borrow and potential...more

Herbert Smith Freehills Kramer

FDIC Views on Leveraged Lending

The FDIC Fall 2019 edition of Supervisory Insights contained an article entitled “Leveraged Lending: Evolution, Growth and Heightened Risk”. In the article, the FDIC noted that the credit agreement terms have continued to...more

King & Spalding

Fifth Circuit Denies Post-Petition Default Interest to Fully Secured Creditors

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On June 14, 2019, the U.S. Court of Appeals for the Fifth Circuit issued an opinion affirming bankruptcy and district court decisions finding that, under the terms of the confirmed Chapter 11 bankruptcy plan, the debtor’s...more

Hogan Lovells

Upstream guarantees and security by foreign subsidiaries of a U.S. corporate borrower may now be available without adverse U.S....

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Tax structuring under the previous regime - Prior to the issuance of the final regulations described below, under Section 956 of the Internal Revenue Code of 1986 and its related Treasury Regulations, for U.S. tax...more

Troutman Pepper Locke

Capital Leases Are Dead; Long Live Finance Leases

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Starting in 2019, public companies will need to adopt the new lease accounting rules set forth in the new Financial Accounting Standards Board (FASB) standard ASC 842 (Leases). Originally published in Law360 - January 16,...more

Bennett Jones LLP

Limitation Law and the Enforcement of Credit and Security Agreements

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In June 2018, we wrote on the British Columbia Court of Appeal decision in Leatherman v 0969708 BC Ltd, 2018 BCCA 33, where the court considered sections 14 and 15 of the "new" Limitation Act, SBC 2012, c. 13 in the context...more

Herbert Smith Freehills Kramer

The New Delaware LLC “Divisive Merger” Provision – A Potentially Dangerous Loophole Under Debt Covenants

Effective August 1, 2018, the Delaware Limited Liability Company Act (the Delaware LLC Act) allows a Delaware limited liability company (an LLC) to divide into two or more LLCs and allocate the assets, liabilities, rights and...more

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