Structural protections in inter-creditor agreements for mezzanine loans

This paper reviews a number of the important structural protections found in inter‐creditor agreements, discusses the negotiated modifications to those protections which are common today and assesses whether the modifications reflect market‐driven erosion of the structural protections. After reviewing the differences between market placements and asset types which can justify such modifications, and the legal rationale underlying many common variations, the author concludes that the variations typically found in inter‐creditor agreements are the product of legitimate negotiation and justifiable differentiation, rather than the erosion of structural protections as a by‐product of a highly competitive environment. Copyright © 2004 Henry Stewart Publications