Shearman & Sterling LLP
Issue link: https://digital.shearman.com/i/1494420
Drop-Down Transactions – Step 3: Incur Priority Debt NewCo incurs new structurally senior/priority debt financing that is secured by the transferred assets. 16 Newly Issued Priority Debt Structurally Subordinated Original Issue Priority debt is issued by NewCo, secured by the newly transferred assets. Existing Borrower's debt is structurally subordinated to the newly issued priority debt of NewCo with respect to security in the assets transferred to NewCo. Original Borrower Unrestricted/ Non-Guarantor Sub (NewCo) Parent Company Original Collateral Package at the level of Original Borrower/Guarantors. Permitted assets transferred for purpose of drop-down transaction. Liability Management and Refinancing Solutions in Europe