Cross acceleration: Difference between revisions
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''Loan documentation.'' | ''Loan documentation.'' | ||
A clause in a loan agreement. It states that the acceleration of a loan with any other lender, following an event of default under another loan agreement, is also an event of default under this agreement. | A clause in a loan agreement. | ||
It states that the acceleration of a loan with any other lender, following an event of default under another loan agreement, is also an event of default under this agreement. | |||
It is designed for the benefit of the lender, to ensure that the lender will enjoy a 'seat at the table' in any refinancing negotiations with the defaulting borrower. | It is designed for the benefit of the lender, to ensure that the lender will enjoy a 'seat at the table' in any refinancing negotiations with the defaulting borrower. | ||
Revision as of 13:53, 29 April 2020
Loan documentation.
A clause in a loan agreement.
It states that the acceleration of a loan with any other lender, following an event of default under another loan agreement, is also an event of default under this agreement.
It is designed for the benefit of the lender, to ensure that the lender will enjoy a 'seat at the table' in any refinancing negotiations with the defaulting borrower.
