Binding Commitment to Purchase Clause Samples
A Binding Commitment to Purchase clause establishes a legally enforceable obligation for one party to buy goods, services, or assets from another party under agreed terms. In practice, this means that once the agreement is executed, the buyer cannot withdraw from the purchase without facing potential legal or financial consequences, and the seller is assured of the buyer’s intent to complete the transaction. This clause ensures certainty and reliability in commercial dealings by preventing either party from backing out arbitrarily, thereby reducing the risk of last-minute cancellations or disputes.
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Binding Commitment to Purchase. In the case of clause (a)(iii)(B) above, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment; provided that (A) such Net Available Cash is applied to acquire Additional Assets within 540 days of the Asset Disposition and (B) in the event such binding commitment is later canceled or terminated for any reason before such Net Available Cash is so applied, the Borrower or such Restricted Subsidiary may satisfy its obligations as to any Net Available Cash by entering into another binding commitment within 90 days of such cancellation or termination of the prior binding commitment and applying the Net Available Cash within 180 days of such subsequent binding commitment; provided further that the Borrower or such Restricted Subsidiary may only enter into such a commitment under the foregoing provision one time with respect to each Asset Disposition.