Mandatory Clause Samples
A "Mandatory" clause establishes that certain actions, requirements, or provisions are compulsory and must be followed by the parties involved. In practice, this clause may specify obligations such as compliance with laws, submission of documents, or participation in required processes, leaving no room for discretion or negotiation. Its core function is to ensure that critical terms are strictly adhered to, thereby reducing ambiguity and ensuring that essential obligations are met without exception.
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Mandatory. (i) Upon the incurrence or issuance by the Borrower or any of its Restricted Subsidiaries of any Indebtedness (other than Indebtedness expressly permitted to be incurred or issued pursuant to Section 7.03 (except Credit Agreement Refinancing Indebtedness)), the Borrower shall prepay (or Cash Collateralize, as applicable) an aggregate principal amount of Pro Rata Obligations equal to 100.00% of the gross cash proceeds received by the Borrower or any of its Restricted Subsidiaries from any such Indebtedness less all reasonable and customary out-of-pocket legal, underwriting and other fees, costs and expenses incurred or reasonably anticipated to be incurred within ninety (90) days thereof in connection therewith, within one (1) Business Day following receipt thereof by the Borrower or such Restricted Subsidiary, (such prepayments (or Cash Collateralization) to be applied as set forth in clauses (v) and (vii) below).
(ii) In the event that (a) there shall be Consolidated Excess Cash Flow for any Fiscal Year (commencing with the Fiscal Year ending December 31, 2022) and (b) there are any Term Loans outstanding at the end of such Fiscal Year, the Borrower shall, no later than one-hundred-twenty-five (125) days after the end of such Fiscal Year, prepay an aggregate principal amount of the Term Loans equal to (A) the ECF Percentage of such Consolidated Excess Cash Flow for such Fiscal Year less (B) all voluntary prepayments of Term Loans, loans under any Incremental Equivalent Debt, Revolving Credit Loans and/or loans under other Indebtedness, in each case, secured on a pari passu basis with the Liens securing the Obligations hereunder, in each case, made during such Fiscal Year or after the end of such Fiscal Year and prior to the date such Consolidated Excess Cash Flow prepayment is due (in the case of any such Revolving Credit Loans or other revolving Indebtedness prepaid, to the extent accompanied by a permanent reduction in the relevant commitment, and in the case of all such prepayments, to the extent that such prepayments are financed with internally generated cash of the Borrower (and not from the proceeds of Indebtedness or the sale or issuance of Equity Interests or equity contributions) and, in the case of all such prepayments made after the end of such Fiscal Year and prior to the date such Consolidated Excess Cash Flow prepayment is due, provided that such amount so deducted shall not be deducted from the Excess Cash Flow Amount in any subsequent per...
Mandatory. (i) If, on any date, the Agent notifies the Borrower that, on any interest payment date, the sum of (A) the aggregate principal amount of all Advances denominated in Dollars then outstanding plus (B) the Equivalent in Dollars (determined on the third Business Day prior to such interest payment date) of the aggregate principal amount of all Advances denominated in Foreign Currencies then outstanding exceeds 105% of the aggregate Commitments of the Lenders on such date, the Borrower shall, as soon as practicable and in any event within two Business Days after receipt of such notice, subject to the proviso to this sentence set forth below, prepay the outstanding principal amount of any Advances owing by the Borrower in an aggregate amount sufficient to reduce such sum to an amount not to exceed 100% of the aggregate Commitments of the Lenders on such date together with any interest accrued to the date of such prepayment on the aggregate principal amount of Advances prepaid; provided that if the aggregate principal amount of Base Rate Advances outstanding at the time of such required prepayment is less than the amount of such required prepayment, the portion of such required prepayment in excess of the aggregate principal amount of Base Rate Advances then outstanding shall be deferred until the earliest to occur of the last day of the Interest Period of the outstanding Eurocurrency Rate Advances or the outstanding LIBO Rate Advances and/or the maturity date of the outstanding Local Rate Advances or Fixed Rate Advances, as the case may be, in an aggregate amount equal to the excess of such required prepayment. The Agent shall give prompt notice of any prepayment required under this Section 2.10(b) to the Borrower and the Lenders, and shall provide prompt notice to the Borrower of any such notice of required prepayment received by it from any Lender.
(ii) Each prepayment made pursuant to this Section 2.10(b) shall be made together with any interest accrued to the date of such prepayment on the principal amounts prepaid and, in the case of any prepayment of a Eurocurrency Rate Advance, a LIBO Rate Advance, a Fixed Rate Advance or a Local Rate Advance on a date other than the last day of an Interest Period or at its maturity, any additional amounts which the Borrower shall be obligated to reimburse to the Lenders in respect thereof pursuant to Section 8.04(d). The Agent shall give prompt notice of any prepayment required under this Section 2.10(b) to the Borrower ...
Mandatory. (i) If for any reason the Total Outstandings at any time exceed the Commitment then in effect, the Borrower shall immediately prepay or repay all outstanding Loans in an aggregate amount equal to such excess.
(ii) To the extent that the aggregate amount of Net Cash Proceeds of Asset Sales and Net Cash Proceeds of Casualty Events received by the Borrower and its Restricted Subsidiaries in a fiscal year exceeds five percent (5%) of Consolidated Net Tangible Assets of the Borrower as of the end of the most recently ended fiscal year, the Borrower shall apply an amount equal to 100% of such excess Net Cash Proceeds to prepay outstanding Loans in accordance with Section 2.03(b)(iv).
(iii) In the event that the Borrower or any Restricted Subsidiary shall receive Net Cash Proceeds from the issuance or incurrence of Indebtedness for money borrowed (other than any cash proceeds from the issuance of Indebtedness permitted pursuant to Section 7.01) the Borrower shall within three Business Day following the receipt of such Net Cash Proceeds by the Borrower or such Restricted Subsidiary, apply an amount equal to 100% of such Net Cash Proceeds to prepay outstanding Loans in accordance with Section 2.03(b)(iv).
(iv) Mandatory prepayments under this Section 2.03(b) shall be applied to outstanding Loans with no corresponding permanent reduction of the Commitments.
(v) Prepayments of Loans under this Section 2.03 shall be subject to Section 3.05, and, to the extent interest is required to be paid pursuant to Section 2.06(c), shall be accompanied by accrued and unpaid interest on the principal amount to be prepaid to but excluding the date of payment.
Mandatory. (i) If any Loan Party or any of its Subsidiaries (x) Disposes of any property in a Disposition constituting an Asset Sale which results in the realization by such Person of Net Cash Proceeds or (y) receives proceeds of casualty insurance or condemnation awards (or payments in lieu thereof), the Company shall prepay an aggregate principal amount of Loans equal to 100% of such Net Cash Proceeds immediately upon receipt thereof by such Person (such prepayments to be applied as set forth in clause (ii) below); provided, however, that, with respect to any Net Cash Proceeds realized under a Disposition described in this Section 2.05(b)(i), at the election of the Company (as notified by the Company to the Administrative Agent on or prior to the date of such Disposition), and so long as no Default shall have occurred and be continuing, such Loan Party or such Subsidiary may reinvest all or any portion of such Net Cash Proceeds in operating assets so long as within 270 days or, if the Consolidated Leverage Ratio is less than 3.50, eighteen (18) months after the receipt of such Net Cash Proceeds, such purchase shall have been consummated (as certified by the Company in writing to the Administrative Agent); and provided further, however, that any Net Cash Proceeds not so reinvested shall be immediately applied to the prepayment (with a corresponding commitment reduction) of the Loans as set forth in this Section 2.05(b)(i).
(ii) If for any reason the Total Outstandings at any time exceed the Aggregate Commitments at such time, the Company shall immediately prepay Loans, Swing Line Loans and L/C Borrowings and/or Cash Collateralize the L/C Obligations (other than the L/C Borrowings) in an aggregate amount equal to such excess.
(iii) Prepayments made pursuant to this Section 2.05(b), first, shall be applied ratably to the L/C Borrowings and the Swing Line Loans, second, shall be applied ratably to the outstanding Loans, and, third, shall be used to Cash Collateralize the remaining L/C Obligations; and the amount remaining, if any, after the prepayment in full of all L/C Borrowings and Loans outstanding at such time and the Cash Collateralization of the remaining L/C Obligations in full (the sum of such prepayment amounts, cash collateralization amounts and remaining amount being, collectively, the “Reduction Amount”) may be retained by the Company for use in the ordinary course of its business, and the Aggregate Commitments shall be automatically and permanently reduce...
Mandatory. (i) Within five (5) Business Days after financial statements have been delivered pursuant to Section 6.01(a) and the related Compliance Certificate has been delivered pursuant to Section 6.02(b), the Borrower shall cause to be prepaid the Term Loans in an amount equal to (A) 50% of Excess Cash Flow, if any, for the fiscal year covered by such financial statements (commencing with the fiscal year ended December 31, 2007) minus (B) the sum of (i) all voluntary prepayments of Term Loans during such fiscal year and (ii) all voluntary prepayments of Revolving Credit Loans during such fiscal year to the extent the Revolving Credit Commitments are permanently reduced by the amount of such payments, in the case of each of the immediately preceding clauses (i) and (ii), to the extent such prepayments are not funded with the proceeds of Indebtedness; provided that if the Total Leverage Ratio as of the last day of the fiscal year covered by such financial statements is less than 5.25:1, the Borrower shall make prepayments of Loans in an aggregate amount equal to 25% of Excess Cash Flow for the fiscal year covered by such financial statements and no payment of any Loans shall be required under this Section 2.05(b)(i) if the Total Leverage Ratio as of the last day of the fiscal year covered by such financial statements is less than 4.5:1.
(ii) (A) If (x) the Borrower or any Restricted Subsidiary Disposes of any property or assets (other than any Disposition of any property or assets permitted by Section 7.05(a), (b), (c), (d) (in the case of clause (d)(i) to the extent constituting a Disposition by any Restricted Subsidiary to a Loan Party), (e), (g), (h), (i), (l), (n) or (o)), or (y) any Casualty Event occurs, which in the aggregate results in the realization or receipt by the Borrower or such Restricted Subsidiary of Net Cash Proceeds, the Borrower shall cause to be prepaid on or prior to the date which is ten (10) Business Days after the date of the realization or receipt of such Net Cash Proceeds Term Loans in an amount equal to 100% of all Net Cash Proceeds (other than Excluded Net Cash Proceeds) received; provided that no such prepayment shall be required pursuant to this Section 2.05(b)(ii)(A) with respect to such portion of such Net Cash Proceeds that the Borrower shall have, on or prior to such date, given written notice to the Administrative Agent of its intent to reinvest in accordance with Section 2.05(b)(ii)(B) (which notice may only be provided if no Eve...
Mandatory. (i) The aggregate Term Commitments shall be automatically and permanently reduced to zero on the date of the Term Borrowing.
(ii) If after giving effect to any reduction or termination of Revolving Commitments under this Section 2.06, the Letter of Credit Sublimit or the Swingline Sublimit exceeds the Revolving Facility at such time, the Letter of Credit Sublimit or the Swingline Sublimit, as the case may be, shall be automatically reduced by the amount of such excess.
Mandatory. If after giving effect to any reduction or termination of Revolving Credit Commitments under this Section 2.06, the Letter of Credit Sublimit or the Swing Line Sublimit exceeds the Revolving Credit Facility at such time, the Letter of Credit Sublimit or the Swing Line Sublimit, as the case may be, shall be automatically reduced by the amount of such excess.
Mandatory. (i) On the date on which the aggregate unpaid principal amount of Eurodollar Rate Advances comprising any Borrowing shall be reduced, by payment or prepayment or otherwise, to less than $5,000,000, such Advances shall automatically Convert into Base Rate Advances.
(ii) If the Borrower shall fail to select the duration of any Interest Period for any Eurodollar Rate Advances in accordance with the provisions contained in the definition of “Interest Period” in Section 1.01, the Administrative Agent will forthwith so notify the Borrower and the Lenders, whereupon each such Eurodollar Rate Advance will automatically, on the last day of the then existing Interest Period therefor, Convert into a Base Rate Advance.
(iii) Upon the occurrence and during the continuance of any Event of Default, (y) each Eurodollar Rate Advance will automatically, on the last day of the then existing Interest Period therefor, Convert into a Base Rate Advance and (z) the obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall be suspended.
Mandatory. The Initial Term Commitment of each Term Lender shall be automatically and permanently reduced to $0 upon the making of such Initial Term Lender’s Term Loans pursuant to Section 2.01(a). The Revolving Credit Commitments shall terminate on the Maturity Date therefor. The Extended Revolving Credit Commitments shall terminate on the respective maturity dates applicable thereto.
Mandatory. (i) Within five (5) Business Days after financial statements have been delivered pursuant to Section 6.01(a) and the related Compliance Certificate has been delivered pursuant to Section 6.02(a), the Borrower shall cause to be prepaid an aggregate principal amount of Term Loans equal to (A) 50% (such percentage as it may be reduced as described below, the “ECF Percentage”) of Excess Cash Flow, if any, for the fiscal year covered by such financial statements minus (B) the sum of (i) all voluntary prepayments of Term Loans during such fiscal year or after year-end and prior to when such Excess Cash Flow prepayment is due (including the aggregate principal amount of Term Loans prepaid pursuant to Section 2.05(a)(iv) during such time) and (ii) all voluntary prepayments of Revolving Credit Loans during such fiscal year or after year-end and prior to when such Excess Cash Flow prepayment is due to the extent the Revolving Credit Commitments are permanently reduced by the amount of such payments, in the case of each of the immediately preceding clauses (i) and (ii), to the extent such prepayments are not funded with the proceeds of Indebtedness; provided that (x) the ECF Percentage shall be 25% if the First Lien Leverage Ratio for the fiscal year covered by such financial statements was less than or equal to 4.00:1.00 and greater than 3.25:1.00 and (y) the ECF Percentage shall be 0% if the First Lien Leverage Ratio for the fiscal year covered by such financial statements was less than or equal to 3.25:1.00; provided, further, any deductions pursuant to clause (i) or (ii) above with respect to prepayments made after the end of a fiscal year shall not be deducted again when calculating the prepayment required to be made pursuant to this Section 2.05(b)(i) for the immediately succeeding fiscal year pursuant to clause (i) or (ii) above.
(ii) (A) If (1) (x) the Borrower or any Restricted Subsidiary Disposes of any property or assets (other than any Disposition of any property or assets (i) permitted by Section 7.05(a), (b), (c), (d) (to the extent constituting a Disposition to a Loan Party), (e), (g), (h), (i), (l), (m), (n), (o) or (p) or (ii) acquired after the Restatement Effective Date in connection with a sale-leaseback transaction permitted hereunder) or (y) any Casualty Event occurs, which in the aggregate results in the realization or receipt by the Borrower or such Restricted Subsidiary of Net Cash Proceeds, and (2) the First Lien Leverage Ratio is greater th...