As sponsors and creditors alike digest the fallout from recent decisions in LME litigation from Serta, Mitel and Incora, their focus inevitably turns to the concrete actions they can take as early as possible to gain an advantage in future out-of-court restructuring transactions .

The overarching theme across those three decisions for many lawyers in the LME space is that very specific word choices from inception will matter when things fall apart. Part of the Mitel decision, for example, appears to have hinged on the word “purchase,” likely included by Wachtell on behalf of Searchlight. That language also appears in certain of Apollo’s portco loan documents, such as those of Employbridge, many of which are drafted by Paul Weiss.

Accordingly, some sponsor's law firms have been proactively responding to such litigation in real time, updating their forms and giving their clients as much documentary flexibility as possible should they need to restructure down the road.