Are cross-default provisions enforceable?
Are cross-default provisions enforceable?
According to the court, cross-default provisions should be enforced depending on facts and circumstances surrounding the particular transaction.
What is cross-default threshold?
A cross default threshold is the minimum loan amount that can be subject to CD. With this clause, loan amounts below the cross default threshold will not trigger a loan’s cross default provisions.
What is the difference between cross acceleration and cross-default?
A cross-acceleration clause is similar to the cross-default clause, except that the debt under the other debt agreement must have been accelerated or otherwise been made to be due and payable in full prior to its stated maturity before the default under the credit agreement is triggered.
What is a default clause?
A default clause is a provision in a legal contract that states what will happen if either party in a contract defaults or fails to hold up their end of the agreement.
Why is cross-default important?
The cross-default provision exists to protect the interest of lenders, who desire to have equal rights to a borrower’s assets in case of default on one of the loan contracts.
What is cross termination?
In the event that either Party terminates the License Agreement for the other Party’s breach of any material provision thereof, the terminating Party, in its sole discretion, may, at that time, terminate this Agreement for cause upon written notice to the other Party.
What is the most common form of tenant default?
What is the most common form of tenant default? Failure to pay rent or maintain the premises.
What is the most common form of landlord default?
Default by landlord The most common form of landlord default is failure to provide services and maintain the property condition. When a landlord defaults on the terms of the lease, tenants may sue for damages.
What is a cross collateralization agreement?
A cross-collateralization clause generally provides that the same collateral, often real property, secures multiple loans from the same lender. In the construction loan context, a developer will often take out sequential loans from the same lender to finance particular phases of a project.
What is cross collateralization clause?
What is mandatory break clause?
August 2020) A break clause is a term in a contract that allows early termination of the contract before the default end date. In accordance with English property law, such clauses are typical in tenancy agreements, so as to allow a tenancy to come to an end before the end date stated in the agreement.
Is default the same as eviction?
The court can enter a default if you don’t respond in a court case. If your landlord gets a default judgment in an eviction case, you can be evicted without going to court. You can also have a judgment for money entered against you.
What Does Have you ever defaulted on a lease mean?
A “default” is a failure to comply with a provision in the lease. “Curing” or “remedying” the default means correcting the failure or omission. A common example is a failure to pay the rent on time.
Is cross collateralization legal?
Cross collateralization is legal and fairly common, but a lender is required to inform you that cross-collateralization is occurring. If you take out multiple secured loans from the same lender, like a bank, it might use the same collateral, making your assets cross-collateralized.
What is a cross collateralization and cross-default agreement?
Borrower and Guarantor acknowledge that the Deeds of Trust are collateral for the entire Loan, and the occurrence of a default under any of the Deeds of Trust or any of the Loan Documents will comprise a default under all of the Deeds of Trust and Loan Documents.
How do I get out of cross-collateralization?
Bad cross-collateralization situations usually end with the loss of the asset, even if you declare bankruptcy. Unfortunately, besides repayment, the only way to get out of cross-collateralization is by letting your lenders repossess the collateral.
How can cross-collateralization be prevented?
Whenever possible, insist on stand-alone loans and securities. Take out separate loans for each new property with the deposit and costs coming from an established line of credit or offset account. Cross-collateralisation can be removed by the current lender, subject to LVR and product guidelines.
What is a cross default provision in a lease?
Cross-Default Provision. A default by Landlord or Tenant in any of the terms and conditions of the Lease (as modified by the provisions herein) shall constitute a default by such party under this Agreement and vice versa. Cross-Default Provision.
What is a cross-default clause in a lease?
In theory, cross-default clauses should give landlords some measure of control over the treatment of their multi-obligation lease arrangements in a tenant’s bankruptcy by preventing leases from being assumed or rejected in piecemeal fashion.
A default clause (or default provision) is a legally binding contractual clause where the parties mutually agree what may result in a contractual default and the consequences associated with it.
What is a cross acceleration clause in a loan?
A cross acceleration clause governs when one lender accelerates a loan’s payments and/or interest and triggers a cross default. The cross default is on another loan linked via the cross acceleration clause.