Schulte Roth & Zabel special counsel Chaim Stern was featured in Tax Notes, discussing the Treasury and the IRS’s proposed regulations on direct pay and transferability of renewable energy credits. In the article, “Required Summer Reading From the IRS: Transfer and Elective Payment Rules, Part 2,” Chaim examines the proposed regulations, explaining to reporter Marie Sapirie several questions arising from them and pointing out where clarification is needed.

According to Chaim, it is not clear that Congress intended for the limitations of sections 38 and 469 to be applicable to purchasers of credits under section 6418. He noted that applying such limitations will have the effect of significantly reducing the population of credit purchasers, which, in turn, will increase the discount associated with credit transfers and reduce the supply of financing for renewable energy projects. Chaim also identified uncertainties regarding the application of the credit recapture rules, and suggested clarifications.

Read the article here.

Schulte Roth & Zabel partner David Arnstein was featured in the Refinitiv Loan Connector article, “Private lenders fund smaller deals amid valuation mismatch.”  

David spoke on unitranche loans below $100m, which have become the most popular deal size in the market, accounting for 52% of transactions in the first quarter of 2023, the highest percentage since 2018.  

“Lenders are very active in the US$100m and up space, but they have tightened their credit standards and remain sensitive to potential issues facing borrowers,” said David. “They want to address those issues up front rather than waiting to see what happens down the road.”