Market Trends 2022/23: Most Favored Nation Clauses in Incremental Facilities

Summary

This practice note discusses how a borrower may exercise its additional permitted debt capacity under a credit agreement and looks at recent market trends in most favored nation (MFN) clauses in publicly filed deals through Q1 2023. MFN clauses largely only apply to incremental term loans issued under the existing credit agreement and may be limited in duration and include other highly negotiated exceptions in their applicability.