Debt Restriction Clause Samples
A Debt Restriction clause limits a party’s ability to incur additional debt beyond specified thresholds or under certain conditions. Typically, this clause applies to borrowers in loan agreements, preventing them from taking on new loans, issuing bonds, or entering into other financial obligations without the lender’s consent. By restricting excessive borrowing, the clause protects the lender’s interests and helps ensure the borrower remains financially stable, thereby reducing the risk of default.
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Debt Restriction. Create, incur, assume or suffer to exist any Debt other than:
(i) in the case of IMC, unsecured Debt, provided that immediately after giving effect thereto, IMC shall be in pro forma compliance (calculated based on historical financial statements most recently furnished or required to be furnished pursuant to paragraph 5A(i) or (ii) as though such Debt had been incurred at the beginning of the period covered thereby, adjusted to account for the refinancing or replacement of Debt by such Debt being incurred and for any permanent repayments of Debt) with the covenants set forth in paragraph 5J, provided further, that with respect to any Debt arising under Hedge Agreements, such Hedge Agreements shall be designed to hedge against fluctuations in interest rates, commodity prices or foreign exchange rates incurred in the ordinary course of business, shall be consistent with prudent business practices, and shall be non-speculative in nature (including, without limitation, with respect to the term and purpose thereof);
(ii) in the case of IMC's Subsidiaries (other than the Joint Venture Company),
(A) Membership Debt with respect to (i) Canpotex incurred in the ordinary course of business and consistent with prudent business practices or (ii) SKMG incurred in the ordinary course of business and consistent with past business practices,
(B) Debt existing on the date hereof, as set forth on Part I of Schedule 6B(2) of the IMC Agreement (such Debt, other than Debt consisting of Intercompany Debt, being the "Existing Subsidiary Debt"), and any Debt extending the maturity of, or refunding or refinancing, in whole or in part, any Existing Subsidiary Debt, provided that the terms of any such extending, refunding or refinancing Debt, and of any agreement entered into and of any instrument issued in connection therewith, are no more restrictive in any material respects than the terms of the Existing Subsidiary Debt being extended, refunded or refinanced thereby (it being understood that Debt being refinanced at maturity may bear interest at then-market rates) and provided further that the principal amount of such Existing Subsidiary Debt shall not be increased above the principal amount thereof outstanding immediately prior to the Restatement Date and the direct and contingent obligors therefor shall not be changed (other than the addition of the guaranty of such Debt by IMC) to the extent such guarantee is otherwise permitted under paragraph 6B(2)(i) , as a result of or in...
Debt Restriction. 47 Section 7.8 Investments............................................47 Section 7.9
Debt Restriction. 26 Section 6.04. Payment of Dividends on the 7% Preferred Stock and the 8% Preferred Stock............................26
Debt Restriction. Create, incur, assume or suffer to exist any Debt, except:
(i) Debt in existence on March 28, 1996;
(ii) Debt of any Subsidiary to the Company or to any other Subsidiary; and
(iii) additional Debt of the Company and/or any Subsidiary subject to the proviso set forth below; PROVIDED, HOWEVER, (x) that the aggregate principal amount of consolidated Debt of the Company and its Subsidiaries shall not exceed at any time an amount equal to 58% of Consolidated Capitalization and (y) Priority Debt shall not exceed at any time an amount equal to 20% of Consolidated Tangible Net Worth.
Debt Restriction. Incur, assume, guarantee or otherwise create any Debt other than:
(a) the Loans and Standby L/Cs provided for pursuant to this Agreement;
(b) Debt relating to purchase money Liens permitted by Section 7.1(e);
(c) Debt not exceeding an aggregate of $6 million at any time, which Debt is fully subordinated to the payment of Debt owed to the Banks; and
(d) Debt not exceeding an aggregate of $3 million at any time, which Debt is assumed by any Borrower in connection with acquisitions permitted by Section 2.11.
Debt Restriction. Borrowers will not incur or allow to be outstanding any future indebtedness for borrowed money, other than that evidenced by the Notes, indebtedness incurred for liability insurance premiums financed for no more than twelve (12) months, and ordinary trade payables, which are incurred in connection with the Borrowers' business;
Debt Restriction. A. Section 5.03(a)
1. Specify 30 day period during preceding 12 month period during which Current Debt had been cleaned down in accordance with Section 5.03(a): [Date] through [Date]
2. Specify highest balance of Current Debt of the Company and its Subsidiaries during the period specified in line 1 above: $_______________
3. Specify highest balance of Funded Debt of the Company and its Subsidiaries during the period specified in Line 1: $_______________ 4. Total of Line 2 plus line 3: $_______________
Debt Restriction. Create, incur, assume or suffer to exist any Indebtedness, except:
Debt Restriction. Create, incur, assume or suffer to exist any Debt, except:
(i) Debt in existence on the Effective Date;
(ii) Debt of any Subsidiary to the Company or to any other Subsidiary; and
(iii) additional Debt of the Company and/or any Subsidiary subject to the proviso set forth below; provided, however, (x) that the aggregate principal amount of consolidated Debt of the Company and its Subsidiaries shall not exceed at any time an amount equal to 70% of Consolidated Capitalization and (y) Priority Debt shall not exceed at any time an amount equal to 20% of Consolidated Net Worth.
Debt Restriction. No additional financial debt or similar obligations provided to the Borrower and/or its subsidiaries shall be allowed without prior written consent of the Bank, with the following exceptions:
(i) revolving line of credit and letters of credit facilities of EUR 750,000.00 (Euros seven hundred fifty thousand and o/oo) in aggregate at the maximum for RBCF granted by a local bank.
(ii) existing lease financing provided to the Borrower;
(iii) existing subordinated debt provided by Schaublin Holding of CHF 1,375,000.00 (Swiss francs one million and three hundred seventy-five thousand and o/oo) to the Borrower;
(iv) Subordinated debt in form of a shareholder loan by Schaublin Holding as defined in Clause 8.