{"component": "clause", "props": {"groups": [{"snippet": "Create, incur, guarantee or suffer to exist any Debt, except:", "samples": [{"hash": "eHm8oecAIk0", "uri": "/contracts/eHm8oecAIk0#permitted-debt", "label": "Loan and Security Agreement (Commercial Vehicle Group, Inc.)", "score": 31.6064338684, "published": true}, {"hash": "2f0QWFrTmnf", "uri": "/contracts/2f0QWFrTmnf#permitted-debt", "label": "Term Loan and Security Agreement (Commercial Vehicle Group, Inc.)", "score": 31.6064338684, "published": true}, {"hash": "dAuUkppeRrj", "uri": "/contracts/dAuUkppeRrj#permitted-debt", "label": "Term Loan and Security Agreement (Blyth Inc)", "score": 26.1937026978, "published": true}], "size": 15, "snippet_links": [{"key": "any-debt", "type": "definition", "offset": [44, 52]}], "hash": "f85ac962224ba4e52fd47ad9d833aad3", "id": 6}, {"snippet": "Consistent with the First Lien Notes Indenture, except: \u2022 ABL facility basket reduced to C$30 million; \u2022 New Second Lien Notes permitted; \u2022 additional pari passu indebtedness basket of C$75 million to be added to support future acquisitions, subject to the Consolidated First-Lien Leverage Ratio being at least 0.50 to 1.0 less than it was prior to the acquisition (after giving pro-forma effect to the acquisition and related incurrence of debt), and provided that any such pari passu indebtedness shall (i) have a maturity date no earlier than the maturity date of the New First Lien Notes; (ii) have no rights to mandatory redemptions or repayments (including, without limitation, from excess cash flow or proceeds from any Asset Disposition); and (iii) have covenants, events of default and economics (including without limitation coupon, interest or fees) no more favourable to the debtholder than the covenants, events of default and economics in respect of the First Lien Notes, provided that to the extent any such pari passu indebtedness has covenants, events of default or economics more favourable to the debtholder than the covenants, events of default and economics in respect of the First Lien Notes, then such more favourable terms shall also be granted in favour of the First Lien Notes; and \u2022 existing C$25 million general junior lien debt basket increased to C$100 million; provided that (i) no cash interest shall be paid on such junior lien debt until the New First Lien Notes are repaid in full, and (ii) such junior lien debt shall (x) have a maturity date later than the maturity date under the New First Lien Notes, (y) have events of default no more onerous than the New First Lien Notes Indenture, and (z) be subject to intercreditor terms that are materially consistent with the intercreditor terms set forth in the Collateral Agency Agreement and shall be provided with no greater rights than those provided to the New Second Lien Notes pursuant to the Collateral Agency Agreement.", "samples": [{"hash": "gWxZYLuDDQW", "uri": "/contracts/gWxZYLuDDQW#permitted-debt", "label": "Support Agreement (Postmedia Network Canada Corp.)", "score": 27.5242977142, "published": true}, {"hash": "d16qtH1GwOt", "uri": "/contracts/d16qtH1GwOt#permitted-debt", "label": "Support Agreement (Postmedia Network Canada Corp.)", "score": 27.5242977142, "published": true}, {"hash": "2a48mzPz8lh", "uri": "/contracts/2a48mzPz8lh#permitted-debt", "label": "Shareholder Consent Agreement (Postmedia Network Canada Corp.)", "score": 27.5242977142, "published": true}], "size": 30, "snippet_links": [{"key": "consistent-with-the", "type": "clause", "offset": [0, 19]}, {"key": "abl-facility", "type": "clause", "offset": [58, 70]}, {"key": "new-second-lien-notes", "type": "definition", "offset": [105, 126]}, {"key": "additional-pari-passu-indebtedness", "type": "definition", "offset": [140, 174]}, {"key": "to-be-added", "type": "clause", "offset": [198, 209]}, {"key": "future-acquisitions", "type": "definition", "offset": [221, 240]}, {"key": "subject-to-the", "type": "definition", "offset": [242, 256]}, {"key": "consolidated-first", "type": "definition", "offset": [257, 275]}, {"key": "leverage-ratio", "type": "clause", "offset": [281, 295]}, {"key": "the-acquisition", "type": "clause", "offset": [349, 364]}, {"key": "after-giving", "type": "clause", "offset": [366, 378]}, {"key": "incurrence-of-debt", "type": "clause", "offset": [427, 445]}, {"key": "and-provided-that", "type": "clause", "offset": [448, 465]}, {"key": "date-no", "type": "clause", "offset": [525, 532]}, {"key": "date-of", "type": "clause", "offset": [559, 566]}, {"key": "no-rights", "type": "clause", "offset": [603, 612]}, {"key": "mandatory-redemptions", "type": "clause", "offset": [616, 637]}, {"key": "from-excess-cash-flow", "type": "clause", "offset": [684, 705]}, {"key": "asset-disposition", "type": "definition", "offset": [727, 744]}, {"key": "events-of-default-and", "type": "clause", "offset": [773, 794]}, {"key": "including-without-limitation", "type": "clause", "offset": [806, 834]}, {"key": "the-covenants", "type": "definition", "offset": [903, 916]}, {"key": "in-respect-of", "type": "clause", "offset": [950, 963]}, {"key": "to-the-extent", "type": "clause", "offset": [1000, 1013]}, {"key": "more-favourable-terms", "type": "clause", "offset": [1225, 1246]}, {"key": "in-favour-of", "type": "clause", "offset": [1269, 1281]}, {"key": "junior-lien-debt", "type": "definition", "offset": [1340, 1356]}, {"key": "no-cash-interest", "type": "clause", "offset": [1410, 1426]}, {"key": "repaid-in-full", "type": "definition", "offset": [1501, 1515]}, {"key": "new-first-lien-notes-indenture", "type": "definition", "offset": [1692, 1722]}, {"key": "intercreditor-terms", "type": "definition", "offset": [1746, 1765]}, {"key": "the-collateral-agency-agreement", "type": "clause", "offset": [1839, 1870]}, {"key": "no-greater-rights", "type": "clause", "offset": [1898, 1915]}, {"key": "pursuant-to-the", "type": "clause", "offset": [1965, 1980]}], "hash": "ee3dd7c18fcad4e6e777ef6bff837c4e", "id": 3}, {"snippet": "Create, incur, guarantee or suffer to exist any Debt, except the following (collectively, \"Permitted Debt\"):\n(a) the Obligations;\n(b) Subordinated Debt, together with unsecured Debt permitted under Section 10.2.1(i), up to $10,000,000 in the aggregate at any time;\n(c) Permitted Purchase Money Debt;\n(d) existing Borrowed Money not satisfied with the initial Loan proceeds and set forth on Schedule 10.2.1;\n(e) [Reserved];\n(f) Debt that is in existence when a Person becomes a Subsidiary or that is secured by an asset when acquired by an Obligor or Subsidiary, as long as such Debt was not incurred in contemplation of such Person becoming a Subsidiary or such acquisition, and does not exceed $2,500,000 in the aggregate at any time;\n(g) Permitted Contingent Obligations;\n(h) Refinancing Debt as long as each Refinancing Condition is satisfied;\n(i) unsecured Debt, together with Subordinated Debt permitted under Section 10.2.1(b), up to $10,000,000 in the aggregate at any time;\n(j) intercompany Debt permitted under Section 10.2.5(a);\n(k) Debt of any Excluded Subsidiary, in an aggregate outstanding amount, for all Excluded Subsidiaries, not to exceed $5,000,000 at any time;\n(l) Revolving Loan Obligations (including those arising from Bank Products) long as such Revolving Loan Obligations do not exceed the Maximum ABL Principal Obligations (as defined in the Intercreditor Agreement);\n(m) Debt under performance bonds, surety bonds, release, appeal and similar bonds, statutory obligations or with respect to workers' compensation claims, in each case incurred in the Ordinary Course of Business, and unsecured reimbursement obligations in respect of any of the foregoing;\n(n) to the extent constituting Debt, unsecured obligations in respect of purchase price adjustments, earn-outs, non-competition agreements, and other similar arrangements, or other deferred payments of a similar nature, representing consideration for a Permitted Acquisition and incurred in connection with any Permitted Acquisition, not to exceed $500,000 in the aggregate, so long as such unsecured Debt is on terms and conditions reasonably satisfactory to Agent;\n(o) customer advances or deposits received for goods and services purchased in the Ordinary Course of Business;\n(p) Indebtedness representing installment insurance premiums (for insurance not to exceed 1 year) owing in the Ordinary Course of Business; and\n(q) Other Debt up to $1,000,000 in the aggregate at any time.", "samples": [{"hash": "ka2afm25OiL", "uri": "/contracts/ka2afm25OiL#permitted-debt", "label": "Loan and Security Agreement (Rocky Brands, Inc.)", "score": 34.8316230774, "published": true}, {"hash": "1v9ZDEMTFk5", "uri": "/contracts/1v9ZDEMTFk5#permitted-debt", "label": "Loan and Security Agreement (Rocky Brands, Inc.)", "score": 34.3524971008, "published": true}, {"hash": "kH0E9P0i8bt", "uri": "/contracts/kH0E9P0i8bt#permitted-debt", "label": "Loan and Security Agreement (Rocky Brands, Inc.)", "score": 33.4380569458, "published": true}], "size": 128, "snippet_links": [{"key": "the-obligations", "type": "clause", "offset": [113, 128]}, {"key": "subordinated-debt", "type": "definition", "offset": [134, 151]}, {"key": "unsecured-debt", "type": "definition", "offset": [167, 181]}, {"key": "in-the-aggregate", "type": "definition", "offset": [235, 251]}, {"key": "at-any-time", "type": "clause", "offset": [252, 263]}, {"key": "permitted-purchase-money-debt", "type": "clause", "offset": [269, 298]}, {"key": "borrowed-money", "type": "definition", "offset": [313, 327]}, {"key": "loan-proceeds", "type": "definition", "offset": [359, 372]}, {"key": "on-schedule", "type": "definition", "offset": [387, 398]}, {"key": "in-existence", "type": "definition", "offset": [440, 452]}, {"key": "a-person", "type": "definition", "offset": [458, 466]}, {"key": "an-obligor", "type": "clause", "offset": [536, 546]}, {"key": "in-contemplation", "type": "clause", "offset": [600, 616]}, {"key": "permitted-contingent-obligations", "type": "definition", "offset": [740, 772]}, {"key": "refinancing-debt", "type": "definition", "offset": [778, 794]}, {"key": "refinancing-condition", "type": "definition", "offset": [811, 832]}, {"key": "intercompany-debt", "type": "definition", "offset": [986, 1003]}, {"key": "debt-of", "type": "definition", "offset": [1043, 1050]}, {"key": "excluded-subsidiary", "type": "definition", "offset": [1055, 1074]}, {"key": "aggregate-outstanding-amount", "type": "definition", "offset": [1082, 1110]}, {"key": "excluded-subsidiaries", "type": "definition", "offset": [1120, 1141]}, {"key": "not-to-exceed", "type": "definition", "offset": [1143, 1156]}, {"key": "revolving-loan-obligations", "type": "definition", "offset": [1185, 1211]}, {"key": "bank-products", "type": "definition", "offset": [1242, 1255]}, {"key": "principal-obligations", "type": "definition", "offset": [1327, 1348]}, {"key": "the-intercreditor-agreement", "type": "clause", "offset": [1364, 1391]}, {"key": "performance-bonds", "type": "definition", "offset": [1409, 1426]}, {"key": "surety-bonds", "type": "clause", "offset": [1428, 1440]}, {"key": "statutory-obligations", "type": "definition", "offset": [1477, 1498]}, {"key": "with-respect-to", "type": "clause", "offset": [1502, 1517]}, {"key": "compensation-claims", "type": "clause", "offset": [1527, 1546]}, {"key": "each-case", "type": "definition", "offset": [1551, 1560]}, {"key": "in-the-ordinary-course-of-business", "type": "definition", "offset": [1570, 1604]}, {"key": "reimbursement-obligations", "type": "definition", "offset": [1620, 1645]}, {"key": "in-respect-of", "type": "clause", "offset": [1646, 1659]}, {"key": "the-foregoing", "type": "clause", "offset": [1667, 1680]}, {"key": "to-the-extent", "type": "clause", "offset": [1686, 1699]}, {"key": "unsecured-obligations", "type": "definition", "offset": [1719, 1740]}, {"key": "purchase-price-adjustments", "type": "clause", "offset": [1755, 1781]}, {"key": "similar-arrangements", "type": "definition", "offset": [1832, 1852]}, {"key": "payments-of", "type": "clause", "offset": [1872, 1883]}, {"key": "similar-nature", "type": "definition", "offset": [1886, 1900]}, {"key": "permitted-acquisition", "type": "definition", "offset": [1935, 1956]}, {"key": "in-connection-with", "type": "clause", "offset": [1970, 1988]}, {"key": "terms-and-conditions", "type": "definition", "offset": [2094, 2114]}, {"key": "customer-advances", "type": "definition", "offset": [2153, 2170]}, {"key": "goods-and-services-purchased", "type": "clause", "offset": [2196, 2224]}, {"key": "insurance-premiums", "type": "definition", "offset": [2303, 2321]}, {"key": "other-debt", "type": "definition", "offset": [2409, 2419]}], "hash": "2b514b643e42dde296d2855a1544ba0c", "id": 1}, {"snippet": "Create, incur, guarantee or suffer to exist any Debt, except:\n(a) the Obligations;\n(b) Subordinated Debt;\n(c) Permitted Purchase Money Debt;\n(d) Borrowed Money (other than the Obligations, Subordinated Debt and Permitted Purchase Money Debt), but only to the extent outstanding on the Closing Date and not satisfied with proceeds of the initial Loans;", "samples": [{"hash": "4fxX702LZce", "uri": "/contracts/4fxX702LZce#permitted-debt", "label": "Loan and Security Agreement (P&f Industries Inc)", "score": 34.2347717285, "published": true}, {"hash": "bdNia0tc4xy", "uri": "/contracts/bdNia0tc4xy#permitted-debt", "label": "Loan and Security Agreement (P&f Industries Inc)", "score": 26.2744693756, "published": true}, {"hash": "3sMQp3LI3TC", "uri": "/contracts/3sMQp3LI3TC#permitted-debt", "label": "Loan and Security Agreement (Sport Chalet Inc)", "score": 18.8021907806, "published": true}], "size": 12, "snippet_links": [{"key": "any-debt", "type": "definition", "offset": [44, 52]}, {"key": "the-obligations", "type": "clause", "offset": [66, 81]}, {"key": "subordinated-debt", "type": "definition", "offset": [87, 104]}, {"key": "permitted-purchase-money-debt", "type": "clause", "offset": [110, 139]}, {"key": "borrowed-money", "type": "definition", "offset": [145, 159]}, {"key": "to-the-extent", "type": "clause", "offset": [252, 265]}, {"key": "the-closing-date", "type": "clause", "offset": [281, 297]}, {"key": "the-initial-loans", "type": "clause", "offset": [333, 350]}], "hash": "c99fb19a4d218ea20842b4c84a8888a0", "id": 8}, {"snippet": "Create, incur, guarantee or suffer to exist any Debt, except Debt incurred or arising pursuant to clauses (a) through (x) below (provided, that, in the case of any such Debt incurred or arising at any time on or after the Petition Date, such Debt shall only be permitted hereunder if no Default or Event of Default shall exist or be continuing as of the time that such Debt is to be incurred or to arise, or shall occur upon, or as a result of, such Debt being incurred or arising):\n(a) the Obligations;\n(b) the Prepetition NPA Facility Debt;\n(c) any (i) Debt incurred to finance the acquisition, construction, or improvement of any fixed or capital assets (whether or not constituting Purchase Money Debt), including Capital Lease Obligations and (ii) Debt assumed in connection with the acquisition of any of the foregoing assets or secured by a Lien on any such assets prior to the acquisition thereof; provided, that no Debt shall be incurred pursuant hereto at any time after the Petition Date unless permitted pursuant to the applicable Chapter 11 Approvals, and no payments in respect thereof shall be made except to the extent in accordance with the Financial Covenants; and provided, further, that the aggregate principal amount of Debt incurred in reliance on this clause (c) after the Petition Date and the creditor payments related thereto are set forth in, and made pursuant to and in accordance with, the Approved Budget;\n(d) Debt incurred prior to the Petition Date; provided, that if any such Debt exceeds an aggregate principal amount of $100,000, a description of such Debt is set forth on Schedule 10.2.1 hereof;\n(e) Debt with respect to Debt in respect of netting services, automatic clearinghouse arrangements, overdraft protections, treasury, depository, corporate purchasing cards and other credit cards, cash management, and similar arrangements, in each case incurred in the Ordinary Course of Business;\n(f) [reserved];\n(g) Permitted Contingent Obligations;\n(h) intercompany Debt solely among the Obligors; provided, that any such Debt shall be subordinated on terms reasonably satisfactory to the Administrative Agent to the Obligations hereunder (including pursuant to the terms of the Intercompany Subordination Agreement);\n(i) Debt incurred in connection with the financing of insurance premiums in the Ordinary Course of Business;\n(j) Debt owed to any Person providing workers\u2019 compensation, unemployment insurance, health, disability or other employee benefits or property, casualty or liability insurance, pursuant to reimbursement or indemnification obligations to such Person, in each case incurred in the Ordinary Course of Business;\n(k) Debt in respect of performance bonds, completion guarantees, bid bonds, appeal bonds, surety bonds and similar obligations, in each case provided in the Ordinary Course of Business;\n(l) [reserved];\n(m) [reserved];\n(n) [reserved];\n(o) preferred stock of Borrower issued prior to the Petition Date and that does not constitute Disqualified Equity Interests, as set forth on Schedule 9.1.4;\n(p) Debt consisting of take or pay obligations contained in supply arrangements entered into in the Ordinary Course of Business; provided, that the aggregate amount of all such obligations incurred or arising and outstanding at any time shall not exceed $500,000; provided, further, that no such obligations shall be incurred at any time as of the Petition Date unless permitted by the DIP Orders or other Chapter 11 Order (in each case, in accordance with the Approved Budget);\n(q) guarantees required by Governmental Authorities in the Ordinary Course of Business;\n(r) [reserved];\n(s) Debt arising under Permitted Employment Arrangements in accordance with the Approved Budget, all of which Debt (other than to the extent relating to \u2587\u2587\u2587\u2587/KERP payments approved by the Bankruptcy Court) shall be subordinated on terms acceptable to the Administrative Agent to the Full Payment of the Obligations;\n(t) endorsements for collection, deposit, or negotiation and warranties of products or services, in each case incurred in the Ordinary Course of Business;\n(u) rental obligations incurred in the Ordinary Course of Business; provided, that the aggregate amount thereof incurred or arising at any time following the Petition Date shall not exceed $1,500,000 unless previously approved in writing by the Administrative Agent;\n(v) [reserved];\n(w) trade payables and other current liabilities incurred in the Ordinary Course of Business and in accordance with the Approved Budget;\n(x) all interest accruing on (including capitalized interest), and all reasonable and documented fees and expenses payable in connection with, the obligations described in the foregoing clauses (in the case of (1) clause (a) of this Section 10.2.1, without limiting the amounts otherwise included pursuant to the definition of Obligations or as provided elsewhere in this Agreement and (2) clause (b) of this Section 10.2.1, without limiting the amounts otherwise included pursuant to the definition of Prepetition April NPA Debt or Prepetition August NPA Debt)); and\n(y) to the extent constituting Debt, obligations under Permitted BTC Hedging Agreement. Notwithstanding anything to the contrary in this Section 10.2.1, no payment shall be made in respect of any Debt (whether or not such Debt is permitted hereunder) at any time after the Interim DIP Closing Date except in accordance with the Approved Budget.", "samples": [{"hash": "5SuRhUnVwzo", "uri": "/contracts/5SuRhUnVwzo#permitted-debt", "label": "Senior Secured Super Priority Debtor in Possession Loan and Security Agreement (Core Scientific, Inc./Tx)", "score": 34.508556366, "published": true}, {"hash": "lTrFsyMl4aR", "uri": "/contracts/lTrFsyMl4aR#permitted-debt", "label": "Loan and Security Agreement (Core Scientific, Inc./Tx)", "score": 34.1635856628, "published": true}], "size": 31, "snippet_links": [{"key": "debt-incurred", "type": "clause", "offset": [61, 74]}, {"key": "pursuant-to-clauses", "type": "clause", "offset": [86, 105]}, {"key": "in-the-case", "type": "clause", "offset": [145, 156]}, {"key": "at-any-time", "type": "clause", "offset": [194, 205]}, {"key": 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"similar-arrangements", "type": "definition", "offset": [1849, 1869]}, {"key": "each-case", "type": "definition", "offset": [1874, 1883]}, {"key": "in-the-ordinary-course-of-business", "type": "definition", "offset": [1893, 1927]}, {"key": "permitted-contingent-obligations", "type": "definition", "offset": [1949, 1981]}, {"key": "intercompany-debt", "type": "definition", "offset": [1987, 2004]}, {"key": "the-obligors", "type": "clause", "offset": [2018, 2030]}, {"key": "the-administrative-agent", "type": "clause", "offset": [2119, 2143]}, {"key": "terms-of-the", "type": "clause", "offset": [2200, 2212]}, {"key": "intercompany-subordination-agreement", "type": "clause", "offset": [2213, 2249]}, {"key": "the-financing", "type": "clause", "offset": [2289, 2302]}, {"key": "insurance-premiums", "type": "definition", "offset": [2306, 2324]}, {"key": "any-person", "type": "definition", "offset": [2378, 2388]}, {"key": "unemployment-insurance", "type": "clause", "offset": [2422, 2444]}, 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["permitted-debt-exchanges", "Permitted Debt Exchanges", "<strong>Permitted Debt</strong> Exchanges"], ["permitted-dispositions", "Permitted Dispositions", "Permitted Dispositions"], ["investments-indebtedness", "Investments; Indebtedness", "Investments; Indebtedness"], ["permitted-contingent-obligations", "Permitted Contingent Obligations", "Permitted Contingent Obligations"]], "related_snippets": [], "updated": "2026-07-02T06:35:13+00:00", "also_ask": ["What are the essential carve-outs that must be included in a Permitted Debt definition?", "How can the scope of Permitted Debt be strategically narrowed or expanded during negotiations?", "What are the most common drafting pitfalls that could unintentionally broaden Permitted Debt?", "How do Permitted Debt provisions in this agreement compare to market standards or similar deals?", "What factors most often lead courts to find Permitted Debt clauses unenforceable or ambiguous?"], "drafting_tip": "List specific categories of permitted debt to prevent loopholes, set quantitative limits to control financial exposure, and require lender consent for exceptions to maintain oversight.", "explanation": "The Permitted Debt clause defines the specific types and amounts of debt that a party is allowed to incur under an agreement without breaching its terms. Typically, this clause lists exceptions to general restrictions on borrowing, such as allowing existing loans, short-term trade credit, or debt below a certain threshold. By clearly outlining which debts are acceptable, the clause provides flexibility for routine business operations while protecting the other party from excessive or risky borrowing."}, "json": true, "cursor": ""}}