(Negative Covenants – Restrictions on Indebtedness Sample Clauses
A negative covenant restricting indebtedness is a contractual provision that prohibits or limits a party, typically a borrower, from incurring additional debt beyond specified thresholds. This clause may require the borrower to obtain the lender’s consent before taking on new loans, issuing bonds, or entering into other financial obligations, and often outlines exceptions for certain types of routine or minor debt. Its core practical function is to protect the lender by preventing the borrower from becoming overleveraged, thereby reducing the risk of default and preserving the borrower’s financial stability.
(Negative Covenants – Restrictions on Indebtedness provided, that such security interests do not apply to any other property or assets of any Loan Party or any Subsidiary besides those acquired or leased pursuant to such transaction (it being agreed that transactions with the same vendor may be cross-collateralized); and
(Negative Covenants – Restrictions on Indebtedness of the Borrowers) or otherwise; provided that such cash collateral does not exceed an amount equal to the sum of (A) the amount of cash collateral for bonds on deposit on the Restatement Effective Date and set forth on Schedule 7.02(a) and (B) two hundred thousand dollars ($200,000);
(Negative Covenants – Restrictions on Indebtedness provided that any such Liens attach only to the assets so acquired and that all Indebtedness secured by Liens created pursuant to this clause (v) constitutes Permitted Indebtedness;
(Negative Covenants – Restrictions on Indebtedness purported Liens evidenced by the filing of precautionary UCC financing statements relating solely to operating leases of personal property entered into in the ordinary course of business and otherwise permitted under this Agreement;
(Negative Covenants – Restrictions on Indebtedness of the Borrower), (B) such Liens are subject to the terms of the Intercreditor Agreement, and (C) the Bond Trustee or any successor or permitted assignee thereof shall have become a party to the Intercreditor Agreement as, and shall have the obligations of, a Second Lien Claimholder (as defined in the Intercreditor Agreement) thereunder;
(Negative Covenants – Restrictions on Indebtedness of the Borrowers) in an amount equal to the proceeds of such additional Indebtedness (net of issuance costs).
(Negative Covenants – Restrictions on Indebtedness of the Borrowers) or otherwise, but only to the extent that the amount of such cash collateral is below the minimum issuance amount for Letters of Credit as provided in Section 2.04(b) (Letters of Credit) and provided that such cash collateral does not exceed two million Dollars ($2,000,000) in the aggregate and, with respect to cash collateral other than in connection with such bonds, one million Dollars ($1,000,000) in the aggregate;
(Negative Covenants – Restrictions on Indebtedness of the Borrowers) will be deleted in its entirety, and replaced with the following: “