Credit documentation transfer provisions, which may in the past have been viewed as rather boilerplate, have increasingly become points of contention in the documentation process. Today these provisions are often highly negotiated and may include significant restrictions on transferability.

To avoid wasteful expenditures of resources, we recommend that clients who are potential buyers of loan positions assess the relevant credit agreement transfer provisions as a gating exercise for each possible acquisition, before coming to an unwelcome realization that these provisions may actually prevent them from acquiring an exposure. Towards that end, this bulletin provides a useful, high-level summary of key transfer provision considerations that can be incorporated into credit documentation reviews.