LSTA Publishes New Forms Of Term SOFR Amendments

The LIBOR transition process continues to roll along. New transactions are (mostly) being closed without using LIBOR any more, and many legacy transactions are naturally transitioning when refinanced or renewed this year. However, a significant portion of the legacy loan market remains that will require active transition at or before LIBOR cessation on June 30, 2023. In order to help members think through the process, the LSTA has produced and distributed a series of amendment forms (LSTA membership required to access forms) that may be used by market participants as part of the LIBOR transition.

There are three basic ways to transition from a legacy LIBOR loan to a benchmark replacement rate. The first can be called a "Consensual Amendment." This is a standard, old-fashioned type of amendment – the parties to a transaction get together and all (typically this would require 100% lender vote) agree to modify an agreement to replace LIBOR with a replacement rate.