Not quite - legally it's whatever is in the agreement and those have been (and still will be) subject to negotiation. In credit agreements without replacement language (e.g., pre 2018 agreements), a Borrower may very well be forced to borrower in prime, for instance.
What you're talking about is the credit spread adjustments from the ARRC formulation of the LIBOR replacement language (11.448 bps for 1 month, 26.161 bps for 3 months and 42.826 bps for 6 months) [0]. In reality, the credit spread adjustments for Term SOFR are still moving and the market has been all over the place - I've seen 10/15/25 bps at 1mo/3mo/6mo tenors (the most common formulation in the leveraged space right now) or a 10 bps flat adjustment (generally viewed as aggressive).
Completely tangentially related: I love basis points. Up until I started working in the FinTech I could not grasp the need for it... but after much repeating "x% plus 3%" and then having to clarify that is 300 basis points and not x*1.03, it got my eyes opened.
It's also useful for negotiating rates. Saying you want a rate to be .2% lower is awkward and wordy. Saying 'can we take it down 20 bips?' sounds much more pro ;).
26bps was the recommended adjustment based on historical analysis at the time. The actual spread in the market is not a constant, and has been below 26bps for a long time. The current LIBOR-SOFR spread is around 12bps. It's all negotiated, so people who earn interest are arguing it should be 26bps and people who pay interest are arguing it should be 12 bps. The market seem to be settling on 3M LIBOR = 3M SOFR + 15-20bps.
What you're talking about is the credit spread adjustments from the ARRC formulation of the LIBOR replacement language (11.448 bps for 1 month, 26.161 bps for 3 months and 42.826 bps for 6 months) [0]. In reality, the credit spread adjustments for Term SOFR are still moving and the market has been all over the place - I've seen 10/15/25 bps at 1mo/3mo/6mo tenors (the most common formulation in the leveraged space right now) or a 10 bps flat adjustment (generally viewed as aggressive).
[0] https://www.newyorkfed.org/medialibrary/Microsites/arrc/file...