The boundaries of a borrower’s freedom to act: negative covenants in loan agreements

The boundaries of a borrower’s freedom to act: negative covenants in loan agreements

 

Louise Gullifer, Professor of English Law at the University of Cambridge discusses negative covenants in loan agreements. Such covenants are not included solely to restrict certain activities by the borrower but also to align the duties of the directors in deciding the activities of the borrower with the lenders' interests, and therefore, play a part in the corporate governance role of lenders, together with financial covenants and events of default. The author examines how this alignment of duties is achieved, and the legal and practical constraints on the content of negative covenants and the way in which they are used by lenders to manage risk

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  JIBFL_2019_Vol34_Issue11_Dec_OFC

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About the author:

Miranda is a solicitor specialising in leveraged and acquisition finance. She trained at Hogan Lovells International LLP and qualified into the international banking and finance team. During her time at Hogan Lovells she worked on a variety of domestic and cross-border transactions, acting for both borrowers and lenders. She also experienced secondments to Barclays Bank PLC and Kaupthing Bank hf.