Cross Default Provisions
Definition
Cross Default Provisions. An legal clause (provision) that impacts the legal standing of distinct credit obligations when one of them is subject to a Credit Event
A typical cross-default clause provides that an event of default under any or certain specified loan obligations of the borrower (other than the loan obligation documented by that specific agreement) constitutes an event of default under that specific loan agreement as well.[1]
References
- ↑ CGAP, Commercial Loan Agreements, A Technical Guide for Microfinance Institutions
Disclaimer
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