Prime Rate Fallback Clause Samples
The Prime Rate Fallback clause establishes an alternative interest rate to be used if the primary reference rate becomes unavailable or is discontinued. In practice, this means that if a loan or financial agreement originally tied to a benchmark rate like LIBOR can no longer use that rate, the interest calculation will default to the prime rate published by a major bank. This clause ensures continuity in interest calculations and protects both parties from uncertainty or disputes over applicable rates if the original benchmark fails.
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Prime Rate Fallback. If any Rate Period expires, any part of the Rate ------------------- Segment corresponding to such Rate Period which has not been converted or renewed in accordance with Section 2.03(e) hereof automatically shall be converted to the Prime Rate Option. If Borrower fails to select, or if Bank fails to approve an Interest Rate Option to apply to the borrowings evidenced by the Revolving Note, such borrowings shall be deemed to be at the Prime Rate Option. If at any time the Bank shall have determined in good faith (which determination shall be conclusive) that the accrual of interest at the Libor Rate Option has been made unascertainable, impractical or unlawful by compliance by the Bank in good faith with any law (including common law), constitution, statute, treaty, regulation, rule, ordinance, order, injunction, writ, decree or award of any government or political subdivision or any agency, authority, bureau, central bank, commission, department or instrumentality of either, or any court, tribunal, grand jury or arbitrator, in each case whether foreign or domestic, or administration thereof by any official body charged with the interpretation or administration thereof or with any request or directive of any such authority, the outstanding principal amount of the Revolving Note subject to the Libor Rate Option shall accrue interest at the Prime Rate Option and the Borrower shall not have the right to select the Libor Rate Option.
Prime Rate Fallback. If any Rate Period expires, any part of the Rate Segment corresponding to such Rate Period which has not been converted or renewed in accordance with Section 2.02 (e) hereof automatically shall be converted to the Prime Rate Option.
Prime Rate Fallback. If any Rate Period expires, any part of the Rate Segment corresponding to such Rate Period which has not been converted or renewed in accordance with Section 6 hereof automatically shall be converted to the Prime Rate Option. If Undersigned fails to select, or if Bank fails to approve, an interest rate Option to apply to the initial borrowing evidenced by the Note, such initial borrowing shall be deemed to be at the Prime Rate Option. If at any time the Bank shall have determined in good faith (which determination shall be conclusive) that the accrual of interest at any of the Interest Rate options has been made impractical or unlawful by compliance with the Bank in good faith with any law (including common law), constitution, statute, treaty, regulation, rule, ordinance, order, injunction, writ, decree or award of any government or political subdivision or any agency, authority, bureau, central bank, commission, department or instrumentality of either, or any court, tribunal, grand jury or arbitrator, in each case whether foreign or domestic, or administration thereof by any official body charged with the interpretation or administration thereof or with any request or directive of any such official body (whether or not having the force of law), then, and in any such event, the outstanding principal amount of this Note subject to such Interest Rate Option shall accrue interest at the Prime Rate Option and the Undersigned shall not have the right to select such Interest Rate Option.
Prime Rate Fallback. If at any time the Lender shall have determined in good faith (which determination shall be conclusive) that:
(i) The Federal Reserve Bank of New York (or its successor) shall not have announced a Federal Funds Effective Rate on any day other than a Saturday, Sunday, public holiday or other day on which no Federal Funds Effective Rate would normally be announced under the practices of such Federal Reserve Bank as of the date hereof, substantially at the time when the Federal Funds Effective Rate on such day would normally be announced under the practices of such Federal Reserve Bank as of the date hereof;
(ii) the effective cost to the Lender of funding any proposed or existing Federal Fund Rate Portion from a corresponding source of funds shall exceed the Federal Funds Effective Rate; or
(iii) the making, maintenance, or funding of any Federal Funds Rate Potion has been made impractical or unlawful by compliance by the Lender in good faith with any law or guideline or interpretation or administration thereof by any official body charged with the interpretation or administration thereof or with any request or directive of any such official body (whether or not having the force of law); then, and in such event, the Lender shall notify Borrower forthwith of such determination. Upon such date as shall be specified in such notice (which shall not be earlier than the date such notice is given), the Federal Funds Effective Rate shall automatically from and after such date be equal to the Prime Rate.