Rights as a lender clause: Copy, customize, and use instantly
Introduction
A rights as a lender clause outlines the specific rights and protections granted to a lender in a loan or credit agreement. These rights often include the ability to enforce repayment, inspect borrower records, and recover collateral in the event of default. This clause ensures that the lender's interests are safeguarded and provides clarity on the scope of their authority.
Below are templates for rights as a lender clauses tailored to different scenarios. Copy, customize, and insert them into your agreement.
Right to enforce repayment clause
This variation grants the lender the right to enforce repayment of the loan.
The lender shall have the right to enforce repayment of the loan in accordance with the terms of this Agreement. In the event of default, the lender may accelerate the loan and demand immediate payment of all outstanding amounts, including principal, interest, and applicable fees.
Right to inspect financial records clause
This variation allows the lender to inspect the borrower’s financial records.
The lender shall have the right to inspect and audit the borrower’s financial records, including but not limited to balance sheets, income statements, and cash flow statements, upon providing [number] days’ prior written notice. Such inspections shall occur during normal business hours.
Right to recover collateral clause
This variation grants the lender the right to recover pledged collateral.
In the event of default, the lender shall have the right to take possession of and dispose of the collateral pledged under this Agreement. The lender may sell, lease, or otherwise liquidate the collateral in accordance with applicable laws to recover the outstanding loan balance.
Right to impose covenants clause
This variation allows the lender to impose financial or operational covenants.
The lender reserves the right to impose covenants on the borrower as a condition of this Agreement. These covenants may include maintaining minimum liquidity levels, limiting additional debt, or other requirements deemed necessary to protect the lender’s interests.
Right to approve material changes clause
This variation gives the lender the right to approve significant changes in the borrower’s operations.
The borrower agrees to obtain the lender’s prior written approval before implementing any material changes to its business operations, capital structure, or asset disposition that could adversely affect its ability to repay the loan.
Right to assign the loan clause
This variation allows the lender to assign or transfer the loan to a third party.
The lender shall have the right to assign or transfer its rights and obligations under this Agreement to a third party without the borrower’s prior consent, provided that such assignment does not materially alter the borrower’s obligations.
Right to accelerate maturity clause
This variation permits the lender to accelerate the loan’s maturity date.
Upon the occurrence of an event of default, the lender shall have the right to declare the entire outstanding loan amount, including accrued interest and fees, immediately due and payable, without further notice or demand.
Right to charge default interest clause
This variation allows the lender to charge a higher interest rate in case of default.
In the event of default, the lender shall have the right to charge default interest on the outstanding loan amount at a rate of [percentage] per annum, in addition to the standard interest rate, until the default is remedied.
Right to demand additional security clause
This variation gives the lender the right to request additional collateral.
If the lender determines that the collateral provided by the borrower is insufficient to secure the loan, the lender shall have the right to demand additional security. The borrower must comply within [time frame] of receiving written notice from the lender.
Right to terminate unused credit clause
This variation allows the lender to terminate unused portions of the loan.
The lender reserves the right to terminate any unused portion of the loan commitment at its discretion if the borrower fails to meet the terms and conditions outlined in this Agreement or if the lender deems the borrower’s creditworthiness to have materially deteriorated.
Right to restrict additional borrowing clause
This variation gives the lender the right to restrict the borrower from obtaining additional loans.
The lender reserves the right to restrict the borrower from incurring additional indebtedness during the term of this Agreement without prior written consent. Any unauthorized borrowing shall constitute a default under this Agreement.
Right to demand financial updates clause
This variation grants the lender the right to request periodic financial updates.
The lender shall have the right to request updated financial statements, projections, and reports from the borrower at regular intervals or upon reasonable demand. The borrower must comply within [time frame] of such a request.
Right to appoint a receiver clause
This variation allows the lender to appoint a receiver in case of default.
In the event of default, the lender shall have the right to petition a court for the appointment of a receiver to manage, operate, and preserve the borrower’s assets, ensuring repayment of the loan.
Right to audit operations clause
This variation allows the lender to audit the borrower’s operations.
The lender shall have the right to conduct audits of the borrower’s operations, facilities, and records to ensure compliance with the terms of this Agreement. The borrower agrees to provide reasonable access and cooperation during such audits.
Right to veto asset sales clause
This variation grants the lender the right to veto significant asset sales by the borrower.
The borrower agrees not to sell, transfer, or otherwise dispose of assets exceeding [specified value] without obtaining the lender’s prior written approval. Failure to comply shall constitute a breach of this Agreement.
Right to suspend loan disbursement clause
This variation allows the lender to suspend further loan disbursements.
The lender reserves the right to suspend disbursement of any undisbursed loan amounts if the borrower fails to comply with any terms or covenants of this Agreement or if the lender determines that the borrower’s financial condition has materially deteriorated.
Right to inspect pledged assets clause
This variation allows the lender to inspect assets pledged as collateral.
The lender shall have the right to inspect any pledged assets during the term of this Agreement. Such inspections may occur with [number] days’ notice and during normal business hours, with the borrower providing full access.
Right to modify repayment terms clause
This variation grants the lender the right to renegotiate repayment terms under specific conditions.
The lender reserves the right to modify repayment terms in the event of significant financial changes affecting the borrower. Any modifications shall be mutually agreed upon and documented in a written amendment to this Agreement.
Right to impose additional conditions clause
This variation allows the lender to impose additional conditions to secure the loan.
The lender reserves the right to impose additional conditions for the continuation of the loan, including but not limited to increased collateral, enhanced reporting requirements, or operational restrictions, if deemed necessary to protect its interests.
Right to recover legal costs clause
This variation grants the lender the right to recover legal costs incurred during enforcement.
In the event of default, the lender shall have the right to recover all reasonable legal costs, expenses, and fees incurred in enforcing the terms of this Agreement, including those associated with litigation or arbitration.
Right to require insurance coverage clause
This variation allows the lender to mandate insurance coverage for collateral.
The lender reserves the right to require the borrower to maintain insurance coverage on all collateral pledged under this Agreement. The borrower must name the lender as a loss payee and provide proof of coverage upon request.
Right to demand early repayment clause
This variation permits the lender to request early repayment under specific conditions.
The lender shall have the right to demand early repayment of the loan if the borrower experiences a material adverse change in its financial condition or breaches any covenant outlined in this Agreement.
Right to block dividend distributions clause
This variation allows the lender to restrict dividend payments by the borrower.
The borrower agrees not to declare or distribute dividends or other shareholder payments without the prior written consent of the lender during the term of this Agreement.
Right to require guarantors clause
This variation grants the lender the right to demand additional guarantors.
The lender reserves the right to require the borrower to provide additional guarantors to secure the loan if the borrower’s financial condition deteriorates or if existing guarantors withdraw their guarantees.
Right to enforce cross-defaults clause
This variation allows the lender to trigger default based on other agreements.
The lender shall have the right to declare the loan in default if the borrower defaults on any other loan, agreement, or obligation that materially impacts its financial condition or ability to repay this loan.
Right to monitor cash flow clause
This variation grants the lender the right to monitor the borrower’s cash flow.
The lender shall have the right to review and monitor the borrower’s cash flow and financial transactions to ensure compliance with the repayment schedule and financial covenants specified in this Agreement.
Right to adjust interest rates clause
This variation allows the lender to adjust interest rates under certain conditions.
The lender reserves the right to adjust the loan’s interest rate upon the occurrence of specific events, including changes in market rates, borrower risk profile, or breach of financial covenants. Any adjustment shall be communicated in writing at least [time frame] in advance.
Right to require debt-to-equity ratio compliance clause
This variation mandates compliance with a specific financial ratio.
The borrower agrees to maintain a debt-to-equity ratio of no more than [ratio] during the term of this Agreement. The lender reserves the right to enforce compliance and request corrective actions if the ratio exceeds the agreed threshold.
Right to approve key management changes clause
This variation grants the lender the right to approve changes in the borrower’s management.
The borrower agrees to obtain the lender’s prior written consent before making any changes to its key management personnel. Failure to seek approval may constitute a breach of this Agreement.
Right to demand additional documentation clause
This variation allows the lender to request additional documents from the borrower.
The lender reserves the right to request additional documentation, including tax filings, legal certifications, or operational records, to verify the borrower’s compliance with the terms of this Agreement. The borrower must provide such documentation within [time frame] of the request.
Right to require insurance coverage clause
This variation allows the lender to mandate insurance coverage for collateral.
The lender reserves the right to require the borrower to maintain insurance coverage on all collateral pledged under this Agreement. The borrower must name the lender as a loss payee and provide proof of coverage upon request.
Right to demand early repayment clause
This variation permits the lender to request early repayment under specific conditions.
The lender shall have the right to demand early repayment of the loan if the borrower experiences a material adverse change in its financial condition or breaches any covenant outlined in this Agreement.
Right to block dividend distributions clause
This variation allows the lender to restrict dividend payments by the borrower.
The borrower agrees not to declare or distribute dividends or other shareholder payments without the prior written consent of the lender during the term of this Agreement.
Right to require guarantors clause
This variation grants the lender the right to demand additional guarantors.
The lender reserves the right to require the borrower to provide additional guarantors to secure the loan if the borrower’s financial condition deteriorates or if existing guarantors withdraw their guarantees.
Right to enforce cross-defaults clause
This variation allows the lender to trigger default based on other agreements.
The lender shall have the right to declare the loan in default if the borrower defaults on any other loan, agreement, or obligation that materially impacts its financial condition or ability to repay this loan.
Right to monitor cash flow clause
This variation grants the lender the right to monitor the borrower’s cash flow.
The lender shall have the right to review and monitor the borrower’s cash flow and financial transactions to ensure compliance with the repayment schedule and financial covenants specified in this Agreement.
Right to adjust interest rates clause
This variation allows the lender to adjust interest rates under certain conditions.
The lender reserves the right to adjust the loan’s interest rate upon the occurrence of specific events, including changes in market rates, borrower risk profile, or breach of financial covenants. Any adjustment shall be communicated in writing at least [time frame] in advance.
Right to require debt-to-equity ratio compliance clause
This variation mandates compliance with a specific financial ratio.
The borrower agrees to maintain a debt-to-equity ratio of no more than [ratio] during the term of this Agreement. The lender reserves the right to enforce compliance and request corrective actions if the ratio exceeds the agreed threshold.
Right to approve key management changes clause
This variation grants the lender the right to approve changes in the borrower’s management.
The borrower agrees to obtain the lender’s prior written consent before making any changes to its key management personnel. Failure to seek approval may constitute a breach of this Agreement.
Right to demand additional documentation clause
This variation allows the lender to request additional documents from the borrower.
The lender reserves the right to request additional documentation, including tax filings, legal certifications, or operational records, to verify the borrower’s compliance with the terms of this Agreement. The borrower must provide such documentation within [time frame] of the request.
Right to appoint an observer clause
This variation allows the lender to appoint an observer to the borrower’s board.
The lender reserves the right to appoint a non-voting observer to the borrower’s board of directors. The observer shall have the right to attend meetings, receive board materials, and provide input, but shall not participate in decision-making processes.
Right to restrict capital expenditures clause
This variation permits the lender to limit the borrower’s capital expenditures.
The borrower agrees not to incur capital expenditures exceeding [specific amount] during the term of this Agreement without prior written approval from the lender. Non-compliance shall constitute a breach of this Agreement.
Right to inspect business operations clause
This variation grants the lender the right to inspect the borrower’s day-to-day operations.
The lender shall have the right to inspect the borrower’s business operations, facilities, and practices during normal business hours with [number] days’ prior notice. The borrower shall provide access and reasonable assistance during such inspections.
Right to prohibit mergers or acquisitions clause
This variation restricts the borrower from engaging in M&A activity.
The borrower agrees not to enter into any mergers, acquisitions, consolidations, or similar transactions without obtaining the lender’s prior written consent. Failure to comply shall trigger a default under this Agreement.
Right to establish an escrow account clause
This variation allows the lender to require an escrow account for loan payments.
The lender reserves the right to mandate the establishment of an escrow account to hold loan payments and other amounts due under this Agreement. The borrower agrees to deposit funds as directed by the lender.
Right to suspend operational activities clause
This variation permits the lender to suspend specific borrower activities.
In the event of non-compliance with this Agreement, the lender reserves the right to direct the borrower to suspend certain operational activities until compliance is restored. The borrower must comply within [time frame].
Right to restructure loan terms clause
This variation grants the lender the ability to restructure loan terms under specific conditions.
The lender reserves the right to propose a restructuring of loan terms if the borrower faces financial distress or fails to meet agreed covenants. Restructuring terms shall be negotiated in good faith and documented in a formal amendment.
Right to recover from third parties clause
This variation allows the lender to recover amounts from third parties tied to the borrower.
The lender shall have the right to recover amounts due from any third parties holding funds, receivables, or obligations owed to the borrower if such recovery is necessary to fulfill outstanding loan obligations.
Right to require independent audits clause
This variation mandates independent financial audits.
The borrower agrees to engage an independent auditor, approved by the lender, to conduct annual audits of its financial statements. The audit results shall be submitted to the lender within [time frame] after the end of each fiscal year.
Right to impose minimum account balances clause
This variation requires the borrower to maintain minimum account balances.
The borrower agrees to maintain a minimum balance of [amount] in its operating account as a condition of this Agreement. Failure to meet this requirement shall constitute an event of default.
Right to access borrower’s advisors clause
This variation grants the lender access to the borrower’s legal or financial advisors.
The lender reserves the right to consult directly with the borrower’s legal or financial advisors to verify compliance with this Agreement. The borrower agrees to facilitate such consultations as needed.
Right to terminate sub-agreements clause
This variation allows the lender to direct termination of borrower sub-agreements.
The lender shall have the right to require termination of any sub-agreement or contract that, in the lender’s sole discretion, jeopardizes repayment of the loan or violates the terms of this Agreement.
Right to require enhanced collateral clause
This variation permits the lender to demand additional or higher-value collateral.
If the lender determines that the existing collateral is insufficient, the lender reserves the right to require enhanced collateral. The borrower must provide the requested collateral within [time frame].
Right to control cash collections clause
This variation grants the lender control over cash collections in default scenarios.
In the event of default, the lender shall have the right to control all cash collections and direct their application to outstanding loan balances. The borrower agrees to deposit all receivables into an account designated by the lender.
Right to adjust financial reporting frequency clause
This variation allows the lender to modify the borrower’s reporting schedule.
The lender reserves the right to increase the frequency of financial reporting by the borrower if deemed necessary to monitor compliance with this Agreement. The borrower must adhere to the adjusted schedule upon receiving written notice.
Right to restrict profit distributions clause
This variation allows the lender to limit profit distributions by the borrower.
The borrower agrees not to distribute profits, including dividends or other disbursements, to shareholders or members without the lender’s prior written consent. Any unauthorized distribution shall constitute a default under this Agreement.
Right to enforce subordination clause
This variation permits the lender to enforce subordination agreements.
The lender shall have the right to enforce any subordination agreements between the borrower and third parties, ensuring that the lender’s claims take priority over other obligations owed by the borrower.
Right to mandate use of proceeds clause
This variation requires the borrower to use loan proceeds for specific purposes.
The borrower agrees to use the proceeds of the loan exclusively for [specific purpose, e.g., working capital, equipment purchase]. The lender reserves the right to verify that the proceeds are used in accordance with this provision.
Right to suspend credit line access clause
This variation allows the lender to suspend access to a credit line.
The lender reserves the right to suspend the borrower’s access to any undrawn portion of a credit line if the borrower fails to comply with the terms of this Agreement or if the lender determines a significant deterioration in the borrower’s creditworthiness.
Right to inspect inventory clause
This variation permits the lender to inspect inventory pledged as collateral.
The lender shall have the right to inspect any inventory pledged as collateral under this Agreement. The borrower must provide full access to inventory records and physical stock upon [number] days’ prior notice.
Right to appoint a financial advisor clause
This variation allows the lender to require the borrower to engage a financial advisor.
The lender reserves the right to require the borrower to engage an independent financial advisor, approved by the lender, to provide guidance on compliance with financial covenants and loan obligations. The costs of the advisor shall be borne by the borrower.
Right to adjust loan covenants clause
This variation permits the lender to modify loan covenants based on risk.
The lender reserves the right to adjust the loan covenants outlined in this Agreement if there is a significant change in the borrower’s financial condition or market environment. Any changes shall be communicated in writing and take effect immediately.
Right to accelerate loan drawdowns clause
This variation allows the lender to require faster drawdowns under specific conditions.
The lender shall have the right to accelerate scheduled loan drawdowns if the borrower’s financial condition requires immediate access to funds. The borrower must comply with any revised drawdown schedule issued by the lender.
Right to demand repayment from guarantors clause
This variation enables the lender to seek repayment directly from guarantors.
In the event of default by the borrower, the lender shall have the right to demand repayment from guarantors as outlined in the guarantee agreement. Guarantors shall fulfill their obligations within [time frame] of receiving notice from the lender.
Right to require compliance with industry standards clause
This variation mandates the borrower’s adherence to industry-specific regulations.
The borrower agrees to comply with all applicable industry standards and regulations during the term of this Agreement. The lender reserves the right to verify compliance and demand corrective actions if any deviations are identified.
Right to seize pledged accounts clause
This variation allows the lender to seize funds in pledged accounts.
In the event of default, the lender shall have the right to seize and apply any funds held in pledged accounts toward the outstanding loan balance. The borrower waives any claims to such funds once a default is declared.
Right to audit borrower subsidiaries clause
This variation permits the lender to audit the borrower’s subsidiaries.
The lender reserves the right to audit the financial and operational records of any subsidiaries wholly or partially owned by the borrower to ensure compliance with this Agreement. The borrower must facilitate such audits as requested.
Right to restrict related-party transactions clause
This variation limits the borrower’s ability to engage in related-party dealings.
The borrower agrees not to engage in related-party transactions exceeding [specific amount] without the lender’s prior written consent. All approved transactions must be conducted at arm’s length and documented accordingly.
Right to impose additional fees clause
This variation allows the lender to charge additional fees under certain conditions.
The lender reserves the right to impose additional fees, including late payment fees, amendment fees, or administrative charges, if the borrower fails to comply with the terms of this Agreement. Any such fees shall be disclosed in writing before implementation.
Right to adjust loan tenor clause
This variation permits the lender to alter the loan’s duration.
The lender reserves the right to adjust the loan tenor, either by shortening or extending the repayment period, if the borrower’s financial condition changes materially. Any adjustment shall be documented through an amendment to this Agreement.
Right to freeze borrower accounts clause
This variation allows the lender to freeze the borrower’s accounts in case of default.
The lender reserves the right to freeze all accounts held by the borrower with the lender in the event of default. Frozen funds shall be applied toward repayment of the outstanding loan balance as outlined in this Agreement.
Right to approve significant contracts clause
This variation grants the lender approval rights over high-value contracts.
The borrower agrees not to enter into contracts exceeding [specific value] without prior written consent from the lender. Such approval shall not be unreasonably withheld but may include conditions to protect the lender’s interests.
Right to enforce pari passu ranking clause
This variation ensures the lender’s claims rank equally with other unsecured creditors.
The lender shall have the right to enforce the pari passu ranking of its claims with all other unsecured and unsubordinated creditors of the borrower, ensuring equal treatment in the event of insolvency or liquidation.
Right to impose prepayment penalties clause
This variation allows the lender to charge penalties for early repayment.
The lender reserves the right to impose a prepayment penalty of [specific percentage] on any early repayment of the loan. The penalty shall be calculated on the principal amount prepaid and must be paid simultaneously with the prepayment.
Right to limit foreign currency exposure clause
This variation restricts the borrower’s exposure to foreign currency risks.
The borrower agrees not to incur foreign currency liabilities exceeding [specific amount or percentage] without prior written consent from the lender. Any unauthorized exposure shall be considered a breach of this Agreement.
Right to demand escrow funding clause
This variation allows the lender to require the borrower to fund an escrow account.
The lender reserves the right to demand the borrower to fund an escrow account with [specific amount] to secure future loan repayments or fulfill specific obligations under this Agreement.
Right to restrict share transfers clause
This variation limits the borrower’s ability to transfer shares.
The borrower agrees not to transfer, sell, or otherwise dispose of any shares or equity interests in the company without the prior written consent of the lender. Unauthorized transfers shall constitute a default under this Agreement.
Right to enforce negative pledge clause
This variation prohibits the borrower from pledging assets to other creditors.
The borrower agrees not to pledge, encumber, or otherwise use its assets as collateral for any obligations to third parties without prior written consent from the lender. Breach of this clause shall result in immediate default.
Right to mandate cash flow management clause
This variation allows the lender to require specific cash flow management practices.
The lender reserves the right to mandate cash flow management measures, including the prioritization of debt servicing over discretionary expenditures. The borrower must implement such measures within [time frame] of receiving written notice.
Right to restrict dividend reinvestment clause
This variation limits the reinvestment of dividends by the borrower.
The borrower agrees not to reinvest dividends in affiliated entities without the lender’s prior written consent. Any unauthorized reinvestment shall be deemed a breach of this Agreement.
Right to approve legal settlements clause
This variation requires the lender’s consent for the borrower’s legal settlements.
The borrower agrees to obtain the lender’s prior written approval before entering into any legal settlement exceeding [specific amount]. Such approval shall ensure that the settlement does not adversely impact the borrower’s ability to fulfill its obligations under this Agreement.
Right to impose cost-cutting measures clause
This variation allows the lender to direct cost-cutting initiatives.
The lender reserves the right to mandate cost-cutting measures, including reductions in discretionary spending, if the borrower’s financial condition deteriorates. The borrower must comply within [time frame] of receiving such directives.
Right to restrict asset acquisitions clause
This variation limits the borrower’s ability to acquire new assets.
The borrower agrees not to acquire assets exceeding [specific value] without prior written consent from the lender. Unauthorized acquisitions shall be considered a breach of this Agreement.
Right to enforce mandatory reporting clause
This variation requires the borrower to adhere to strict reporting schedules.
The borrower agrees to provide mandatory financial and operational reports to the lender on a [monthly/quarterly] basis. Non-compliance with this reporting requirement shall constitute an event of default.
Right to limit exposure to related-party debt clause
This variation restricts the borrower’s ability to incur related-party debt.
The borrower agrees not to incur debt from related parties exceeding [specific amount or percentage] without prior written consent from the lender. Any breach of this provision shall be deemed a default under this Agreement.
Right to enforce environmental compliance clause
This variation requires the borrower to adhere to environmental regulations.
The borrower agrees to comply with all applicable environmental laws and regulations during the term of this Agreement. The lender reserves the right to verify compliance and demand corrective actions if any violations are identified.
Right to adjust collateral valuation clause
This variation allows the lender to reassess the value of pledged collateral.
The lender reserves the right to conduct periodic revaluations of the collateral pledged under this Agreement. If the collateral’s value is deemed insufficient, the borrower must provide additional security within [time frame].
Right to restrict strategic alliances clause
This variation limits the borrower’s ability to form partnerships.
The borrower agrees not to enter into strategic alliances, joint ventures, or similar partnerships without obtaining the lender’s prior written consent. Unauthorized agreements shall constitute a breach of this Agreement.
Right to impose sanctions on non-compliance clause
This variation permits the lender to impose sanctions for breaches of terms.
The lender reserves the right to impose sanctions, including additional fees or restrictions, if the borrower fails to comply with any obligations outlined in this Agreement. Such sanctions shall be communicated in writing and enforced immediately.
Right to recover from insurance proceeds clause
This variation allows the lender to claim insurance payouts.
The lender shall have the right to recover outstanding loan amounts from any insurance proceeds payable to the borrower under policies covering pledged collateral. The borrower must notify the lender of any claims filed and amounts received.
Right to approve material supplier changes clause
This variation grants the lender oversight of supplier relationships.
The borrower agrees not to replace or terminate key suppliers without prior written consent from the lender. Any changes must ensure continuity of operations and adherence to loan covenants.
Right to intervene in management decisions clause
This variation allows the lender to influence key management actions.
The lender reserves the right to intervene in significant management decisions that could materially impact the borrower’s ability to meet its obligations under this Agreement. The borrower must consult with the lender before executing such decisions.
Right to mandate cash reserve levels clause
This variation requires the borrower to maintain specific cash reserves.
The borrower agrees to maintain a minimum cash reserve of [specific amount] throughout the term of this Agreement. Failure to maintain the required reserves shall constitute an event of default.
Right to enforce non-disclosure of loan terms clause
This variation restricts the borrower from disclosing loan details.
The borrower agrees not to disclose the terms of this loan to third parties without the lender’s prior written consent, except as required by law or regulatory authorities. Unauthorized disclosures shall constitute a breach of this Agreement.
Right to recover operational control clause
This variation permits the lender to assume operational control during default.
In the event of default, the lender shall have the right to assume operational control of the borrower’s business to safeguard its financial interests. The borrower must cooperate fully during this process.
Right to limit inventory obsolescence clause
This variation grants the lender oversight of inventory practices.
The borrower agrees to implement measures to minimize inventory obsolescence and waste. The lender reserves the right to review inventory management practices and require adjustments as necessary.
Right to approve business relocation clause
This variation restricts the borrower’s ability to relocate operations.
The borrower agrees not to relocate its primary operations or headquarters without the lender’s prior written consent. Unauthorized relocation shall constitute a default under this Agreement.
Right to require risk management policies clause
This variation mandates the implementation of risk management procedures.
The borrower agrees to establish and maintain risk management policies, including [specific measures, e.g., insurance coverage, contingency planning]. The lender reserves the right to review and approve these policies periodically.
Right to enforce credit rating maintenance clause
This variation requires the borrower to maintain a specific credit rating.
The borrower agrees to maintain a minimum credit rating of [specific level] throughout the loan term. Any downgrade must be reported to the lender immediately and may trigger additional conditions or remedies.
Right to demand independent valuation clause
This variation allows the lender to request third-party valuations of assets.
The lender reserves the right to demand an independent valuation of the borrower’s assets at any time during the term of this Agreement. The costs of such valuations shall be borne by the borrower.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.