Debt Capital Markets · glossary
Valkenrade’s promise not to give security for any other bond or similar security unless the Notes share it equally. It binds each Material Subsidiary too. Bank loans fall outside it, so a bank may still take security over a warehouse. Condition 3.1 · Chapter 5 · see Relevant Indebtedness
Explained in Chapter 5, Negative Pledge and Events of Default, of Debt Capital Markets.
The main page for this term is Negative pledge, in Finance Deals & Syndicated Lending.
The Notes are unsecured and run for 7 years, and holders cannot watch Valkenrade’s business from day to day. Two terms protect them. Condition 3, the negative pledge, stops Valkenrade giving security for other bonds unless holders share it. Condition 9 lists the events of default: the failures that let a holder demand its money back early.Read Chapter 5, Negative Pledge and Events of Default →
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