hard · Private Credit & Debt documentation-covenants-terms

Which combination of provisions most COMPLETELY blocks the specific value-leakage mechanism, as opposed to merely making it harder or constraining a different leakage path?

1. A 'blocker' barring transfer of material IP to unrestricted subsidiaries, a requirement that any unrestricted-subsidiary designation use capacity only from the available-amount/builder basket, and a 'Serta'-style anti-non-pro-rata-uptier provision requiring affected-lender consent.
2. A cap on restricted payments to the sponsor, a most-favored-nation pricing protection on incremental debt, and a quarterly leverage covenant that tightens over time on a step-down schedule.
3. A 'blocker' prohibiting transfer or exclusive licensing of material IP to any unrestricted subsidiary, a 'guarantor coverage' covenant requiring subsidiaries holding a threshold of assets to remain restricted guarantors, and an investment-basket carve-out that excludes contributing such IP to unrestricted subsidiaries.
4. An anti-layering covenant capping total priming debt, an excess-cash-flow mandatory-prepayment sweep, and a prohibition on the borrower repurchasing its own loans below par via open-market purchases.

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