Document background
The Negative Pledge Agreement is a crucial document in Irish financing arrangements, typically used alongside facility agreements and other security documents. It serves as a protective mechanism for lenders by restricting the borrower's ability to grant security interests over its assets to other parties. This document is particularly relevant in unsecured lending scenarios or where lenders want additional protection beyond their existing security package. The agreement must comply with Irish law requirements and typically includes detailed provisions on permitted security, compliance monitoring, and enforcement mechanisms. It's commonly used in corporate financing, project finance, and general commercial lending transactions where maintaining the lender's priority position is crucial.
