DEBTOR’S NEGATIVE COVENANTS Clause Samples

DEBTOR’S NEGATIVE COVENANTS. Regardless the rest of the obligations undertaken by the Debtor by virtue of this Agreement and while any indebted amount is pending of payment by virtue of this Agreement the Debtor shall not, without previous consent in writing by the Bank: (a) Make significant amendments to the Debtor’s by-laws. “Significant Amendments” shall be understood as those which purpose is to amend the line of business, to reduce the Debtor’s capital or to modify its duration; (b) To grant a pledge, mortgage or any kind or lien or real right over any asset owned by the Debtor, or to grant its personal or general guarantee in favor of third parties, except for those bonds already granted and valid as of the date of this instrument. In the event of granting real or personal guarantees in favor of third parties, the Debtor shall simultaneously grant guarantees in favor of BCI under similar conditions as third parties. TENTH: Reasons for the Enforceability of the Loan. The Bank shall be empowered to immediately demand repayment of the total Loans as if they had matured in the case of violation of the obligations described in the Ninth Clause above, and besides in the following cases: (a) If the Debtor incurs a delay or postponement of capital and interests repayment as agreed and such non-compliance continues for over 3 continuous days;

DEBTOR’S NEGATIVE COVENANTS. Debtor will not at any time, without the consent of one or both of the Secured Parties: (a) (Mergers, Consolidations or Sales) (i) merge or consolidate with or into any corporation or convey a controlling ownership interest in the Debtor or its constituent partners; (ii) enter into any joint venture or partnership with any person, firm or corporation; (iii) convey, lease or sell all or any material portion of its property or assets or business to any other person, firm or corporation, except for the sale of inventory in the ordinary course of its business; or (iv) convey, lease or sell any of its assets to any person, firm or corporation for less than the fair market value thereof. (b) (Disposition of Accounts) Sell, assign, or otherwise dispose of any Accounts, with or without recourse, except to the Secured Parties.

DEBTOR’S NEGATIVE COVENANTS. (a) Debtor will not sell, transfer, or encumber any of the Collateral, except that Debtor may sell inventory in the ordinary course of business and may dispose of equipment that has become obsolete or worn-out in the ordinary course of Debtor’s business. (b) Debtor will not, except as permitted in this Agreement, permit the Collateral to be covered by a document, except a document in the possession of Secured Party. (c) Debtor will not change: (i) its name or jurisdiction of organization, merge or consolidate with any person, or convert to a different entity without notifying Secured Party at least thirty days in advance and taking action to continue the perfected status of the security interest in the Collateral; or (ii) the state in which Debtor’s place of business (or chief executive office if Debtor has more than one place of business) is located, change its name, or convert to a different entity without notifying Secured Party at least thirty days in advance and taking action to continue the perfected status of the security interest in the Collateral. (iii) change Debtor’s name or state of residence without notifying Secured Party at least thirty days in advance and taking action to continue the perfected status of the security interest in the Collateral.