Clear Market Provision

Definition:

A provision in an Underwriting Agreement where the issuer agrees not to issue new securities for an agreed period during the offering period and following the Closing of the transaction to protect the underwriters from having to compete for investors with the issuer as well as to avoid the risk of Integration.

In the context of syndicated loans, a contractual provision in the Commitment Letters that makes it a Condition Precedent (CP) to making loans that the borrower and its subsidiaries not incur any other debt or issue any securities for a specified period of time that would compete with the Syndication of the loans.

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