What is a senior subordinated debt?
Senior Subordinated Debt means any obligation of the Guarantor to its creditors, whether now outstanding or subsequently incurred, where the instrument creating or evidencing the obligation or pursuant to which the obligation is outstanding, provides that it is subordinate and junior in right of payment to Senior Debt.
What is subordinated debt financing?
Subordinated debt is any type of loan that’s paid after all other corporate debts and loans are repaid, in the case of borrower default. Borrowers of subordinated debt are usually larger corporations or other business entities.
What is a senior subordinated structure?
Senior-Subordinate Structure means a Debt issue that provides Creditors a claim against revenues pledged for Debt repayment or other Debt security that is either senior or subordinate to a claim against the same revenues or security of Creditors to other Debt.
What is senior debt financing?
Senior debt is borrowed money that a company must repay first if it goes out of business. Each type of financing has a different priority level in being repaid if the company goes out of business.
What does senior unsecured debt mean?
Senior Unsecured Debt means indebtedness for borrowed money that is not subordinated to any other indebtedness for borrowed money and is not secured or supported by a guarantee, letter of credit or other form of credit enhancement.
Is senior unsecured debt subordinated?
What is a senior unsecured loan?
Senior Unsecured Loan . Senior Unsecured Loan . Any assignment of or Participation Interest in or other interest in an Unsecured Loan that is not subordinated to any other unsecured indebtedness of the Obligor (other than with respect to liquidation, trade claims, capitalized leases or similar obligations).
Is a revolver senior debt?
A revolver is a form of senior bank debt that acts like a credit card for companies and is generally used to help fund a company’s working capital needs.
What is the difference between senior debt and subordinated debt?
Senior debt has the highest priority and, therefore, the lowest risk. Thus, this type of debt typically carries or offers lower interest rates. Meanwhile, subordinated debt carries higher interest rates given its lower priority during payback. Subordinated debt is any debt that falls under, or behind, senior debt.
Can unsecured debt be senior to secured debt?
Senior debt is often, but not always, secured debt. Secured debt gets its security from an asset that you put up as collateral. Junior debt is often unsecured; however, lenders may take second liens on your fixed assets in order to extend you junior (or subordinated) secured debt. …
Is a revolver considered funded debt?
Understanding Revolvers The term revolver comes from revolving credit, a category of financing or borrowing. A revolver lets an individual consumer or a business open a line of credit through a credit card or line of credit bank account, where the credit issuer offers a specified level of credit over time.