Common use of Conversion of Floating Charge Clause in Contracts

Conversion of Floating Charge. (a) The Bank may, upon the occurrence of an Event of Default or a prospective Event of Default, by serving a notice in writing on the Company, convert the floating charge hereby created into a fixed charge as regards any property, assets or rights specified in that notice. (b) Without prejudice to the effect of this Clause, if the Company mortgages, charges, pledges or otherwise encumbers (whether by way of fixed or floating charge or otherwise howsoever) any of the Inventories or attempts to do so without the prior consent in writing of the Bank, or is otherwise in breach of any of the provisions in Clause 6, or if any person levies or attempts to levy any distress, execution or sequestration or other process against all or any of the Inventories on the occurrence of any of such events, the floating charge created under Clause 3.1 shall automatically and immediately, without any notice from the Bank or any other formality or process whatsoever, crystallize and operate as a fixed charge as regards the Inventories.