Market Trends 2021/22: Unrestricted Subsidiary Provisions

Summary

This practice note provides an overview of provisions in credit agreements governing the designation and treatment of unrestricted subsidiaries and discusses market trends in these provisions in publicly filed credit agreements from the second half of 2021 and the beginning of 2022. Unrestricted subsidiaries typically are designated by the borrower and excluded as subsidiaries for purposes of covenant compliance in the credit agreement.