15 Nov 2022
Market Trends 2021/22: Competitive Bid Loan Provisions
Review the market trends in competitive bid loan provisions. This practice note discusses current market trends in publicly-filed credit agreements since the last quarter of 2021. The data analyzed in this practice note was obtained using Market Standards, which contains over 4,000 publicly-filed credit agreements from 2017 to the present.
Click here to access credit agreements on Market Standards
Related Content
- Tranches of Loans and Loan Mechanics in Credit Agreements
Review this practice note describing the types of loans available to a borrower, whether as a revolving line of credit or one term draw-down, and the process by which the borrower requests that funds are made available to it under a credit facility.
- Competitive Bid Loan Promissory Note (Credit Agreement)
Use this competitive bid loan promissory note template in an investment grade credit agreement that includes a competitive bid loan facility.
- Structuring a Financing Transaction
Read this practice note providing a general overview of how a financing is structured. It discusses the reasons that a financing is entered into and how those reasons drive the components of a financing
Practical Guidance Updates
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- Market Standards Highlights:
- JetBlue Airways. On October 21, 2022, JetBlue Airways Corporation (“JetBlue”) and certain of its subsidiaries entered into a $600 million credit agreement (the “Credit Agreement”) with Citibank, N.A., as agent, and the lenders party thereto from time to time. The Credit Agreement modified JetBlue’s existing credit facility to increase the lending commitments by $50 million, for total commitments of $600 million, and establish the maturity date for the $600 million in lending commitments as October 21, 2024 (the “Amended Credit Facility”).
Notable Provisions: (1) The Amended Credit Facility includes a variable interest rate based on SOFR, plus a margin of 2.00% per annum, or the alternate base rate (at JetBlue’s election) plus a margin of 1.00% per annum, in each case with a floor of 0%. The applicable margin may be adjusted by a sustainability adjustment depending on its ESG score. (2) The Credit Agreement does not include a SOFR spread adjustment. To track credit spread adjustments, see our Credit Spread Adjustment Tracker. (3) The obligations of JetBlue under the Amended Credit Facility are secured by liens on certain eligible aircraft spare parts, aircraft and spare engines, and flight training devices. JetBlue may also pledge cash and cash equivalents and slots, gates, and routes. For more information on perfection of security interests in aircraft-related collateral, see Perfection Outside Article 9: Vessels, Aircraft, Intellectual Property, and Life Insurance Policies and Security Interests in Uncommon Collateral Presentation.
- JetBlue Airways. On October 21, 2022, JetBlue Airways Corporation (“JetBlue”) and certain of its subsidiaries entered into a $600 million credit agreement (the “Credit Agreement”) with Citibank, N.A., as agent, and the lenders party thereto from time to time. The Credit Agreement modified JetBlue’s existing credit facility to increase the lending commitments by $50 million, for total commitments of $600 million, and establish the maturity date for the $600 million in lending commitments as October 21, 2024 (the “Amended Credit Facility”).
- New Practical Guidance Content
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