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pulled this from the link above
Typical events of default (for illustrative purposes only) are as follows:
• Payment Default. Borrower fails to pay when due any amount of principal or
interest.
• Breach of Nonpayment Covenant. Borrower fails to perform any covenant or agreement
contained in the sections of this agreement pertaining to the use of proceeds,
notices of default, liens, and encumbrances or payment of taxes.
• Breach of Representation or Warranty. A representation by borrower proves to be
untrue, incomplete, or misleading at the time made.
• Cross-default. Borrower defaults on the payment of or performance under debt owed
to another lender such that the default results in the acceleration of the maturity of
such debt obligation.
• Dissolution or Bankruptcy. Borrower is dissolved or becomes subject to voluntary
or involuntary bankruptcy proceedings.
• Judgment Liabilities. Aggregate amount (excluding amounts that may be subject to
appeal and amounts for which the borrower has set aside reserves) of unsatisfied judgments,
decrees, or orders for the payment of money against the borrower exceeds
[specified amount].
• Governmental Authorization or Action. Governmental authorizations necessary for
the continued enforceability and validity of the loan agreement fail to remain valid
or become invalid.
• Change of Control. Borrower ceases to exist because of a business combination or the
sale of a substantial part of its business.
• Change of Condition. Borrower has a change in financial condition or business that
the lender determines may be reasonably expected to materially and adversely affect
the borrower’s ability to perform its obligations.
• Depreciation of Collateral. Collateral the borrower has posted has depreciated
below a certain predetermined threshold value (often set at the initial value of the
collateral).
• Responses to Lender Information Requests for Financial Statements. Failure to submit
any reasonably requested financial, operational, and institution information to the
lender within 10 business days. | |
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Calling bank loans
