Limitations on Future Obligations Secured by Net Revenues Sample Clauses
The 'Limitations on Future Obligations Secured by Net Revenues' clause restricts a party's ability to incur new debts or obligations that are secured by the same net revenues already pledged under an existing agreement. In practice, this means that the party cannot use the same stream of net revenues as collateral for additional loans or financial commitments without meeting certain conditions, such as obtaining consent or ensuring the new obligations are subordinate to existing ones. This clause serves to protect the interests of current creditors by preventing the dilution of their security and ensuring that the pledged net revenues remain available to satisfy existing obligations.
Limitations on Future Obligations Secured by Net Revenues. (a) No Obligations Superior to Bonds or Parity Obligations. In order to protect further the availability of the Net Revenues and the security for the Bonds and any Parity Obligations, the Authority covenants that no additional bonds or other indebtedness will be issued or incurred on a senior basis to the Bonds or such Parity Obligations that are payable out of the Net Revenues in whole or in part.
Limitations on Future Obligations Secured by Net Revenues