Common Contracts
1 similar Agreement Among Lenders contracts
Agreement Among Lenders: Triggering EventsAgreement Among Lenders • January 26th, 2021
Direct lending transactions are often effected through a unitranche credit facility that include “first out” and “last out” classes of loans (aka FOLO structure). The relative rights of each such class are often governed by an Agreement Among Lenders (or AAL). A highly negotiated concept in any AAL involves “Triggering Events” which grant the “first out” lenders increased rights (whether economic, voting, or otherwise) when a Borrower’s performance begins to show trouble. Failure to carefully negotiate “Triggering Events” can cripple a Last Out Lender’s ability to provide solutions or shape the path forward where a Borrower is showing signs of distress.
