Loans by Loan Parties Sample Clauses
The "Loans by Loan Parties" clause prohibits or restricts the entities that are borrowers or guarantors under a loan agreement (the Loan Parties) from making loans to other parties, including affiliates or subsidiaries, without the lender's consent. Typically, this clause outlines specific conditions under which such intercompany loans may be permitted, such as requiring that the loans be on arm's length terms or within certain monetary limits. Its core function is to prevent the Loan Parties from diverting funds or increasing credit risk in a way that could jeopardize the lender's security or the borrower's ability to repay the primary loan.
Loans by Loan Parties. No Loan Party has made any loans or advances to any Affiliate or other Person except for advances authorized hereunder to employees, officers and directors of each Loan Party for travel and other expenses arising in the ordinary course of such Loan Party's business.