TrendLines Topical Report: Lens on Loopholes Q1’26 Update: Share of Index Loans With J.Crew/Serta/Chewy (Full & Qualified)/Envision/Pick-Your-Poison Loopholes
Steve Miller: Executive - Covenant Review
7 April 2026
- How covenant loopholes are distributed across the JP Morgan Leveraged Loan Index and where concentration is rising.
- What current data reveals about the Share of Index Loans With Covenant Loopholes among stressed and lower priced credits.
- Why provisions such as J Crew Serta Chewy and Envision matter for lender protections and value preservation.
- How private equity backed borrowers compare with the broader index in exploiting documentation flexibility.
- Where investors can identify heightened risk from pick your poison and weakened MFN protections.
This report updates the share of the JP Morgan Leveraged Loan Index with named covenant loopholes associated with
specific borrowers—J.Crew, Serta, Chewy and Envision—as of March 31, 2026, based on Covenant Review’s extensive
database, which covers 98% of JP Morgan BSL Index loans. In addition, we provide the latest read of what percentage
of Index borrowers have a pick-your-poison provision as well as those that can issue new first-lien debt under freeand-
clear incremental tranches without triggering an MFN because either (1) the MFN has expired or (2) the document
carves out the F&C tranche from yield protection.
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