Deduction Covenants Clause Samples

Deduction Covenants. (1) On condition of mature payable liabilities, the mortgagee has the rights to deduct from any account opened in Shanghai Pudong Development Bank by the mortgagor. (2) Without special provisions, the deducted money shall be firstly used to repay mature liabilities of the mortgagor, then repay mature interests, finally repay interest on principal. (3) On condition of different currencies between the deducted money and payable liabilities, the mortgagee has the right to settle/buy foreign exchange in accordance with the exchange rate set by the mortgagee; the exchange risk shall be borne by the mortgagor.