negative pledge
C2CEFR level
90/100Rarity: very rare
TechnicalRegister
Law phrase
An undertaking by the borrower not to create or permit any security over its assets in favour of other creditors without the lenders' consent.
The negative pledge prevents the company from granting a charge to any competing financier.
Business noun
A covenant barring a borrower from granting other creditors security over its assets.
The negative pledge stopped the company from ring-fencing its best assets for a new secured lender.
Rarity runs from 0 (a word everyone knows) to 100 (almost never seen outside specialist or literary writing). Level is the word's real difficulty on the CEFR scale, from A1 to C2.
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