Market Trends 2024: 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 deals publicly filed in 2024. MFN clauses largely only apply to incremental term loans issued under the existing credit agreement, may be limited in duration, and often include other highly negotiated exceptions in their applicability.