December 22, 2021 - by Elliot Ganz. For years, sponsors have tried (most often, successfully) to chip away at lender protections in credit agreements. With so much money flowing into the leveraged loan market, the skyrocketing demand has created an increasingly borrower-friendly environment and resulted in many credit agreements looking more like IOUs than highly negotiated contracts that seek to balance the interests of borrowers and lenders.

In this article, Peter Washkowitz, Head of Americas Covenants at Reorg discusses certain new terms and mechanics being seen in sponsored, private credit agreements reviewed by Reorg Covenants Prime and briefly reviews other terms that may at one time have been the exceptions to the rules but have slowly and steadily begun to turn into the rules themselves.