Regulatory Termination Event Clause Samples
A Regulatory Termination Event clause defines the circumstances under which a contract may be terminated due to changes in laws or regulations that make performance illegal or impractical. Typically, this clause applies when a new regulation, government order, or legal requirement directly impacts the parties’ ability to fulfill their contractual obligations, such as a ban on a specific product or service. Its core function is to provide a clear mechanism for ending the agreement without penalty when compliance with the law becomes impossible, thereby protecting both parties from unforeseen regulatory risks.
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Regulatory Termination Event. Lender may, upon 90 days prior written notice to Servicer (or such shorter time period as is required by a Governmental Authority or by applicable Law), terminate this Loan Origination Agreement (a) in whole or in part as may be required to meet the requirements of a Governmental Authority, if Lender receives written notification from a Governmental Authority indicating that the relationship created between Lender and Servicer by this Loan Origination Agreement and/or the Servicing Agreement breaches, violates, contravenes or conflicts with any Law, Order, or Permit applicable to Lender in any material respect, (b) consistent with regulatory guidance obtained or derived by Lender in good faith from a Governmental Authority with jurisdiction over financial institutions; (c) in whole or in part, as applicable, if as a result of such Loan Origination Agreement or the Loans contemplated hereby, Lender is subject to unduly burdensome regulatory restrictions or (d) in part with respect to any Program Agreement, if Lender receives written notification from a Governmental Authority indicating that such Program Agreement breaches, violates, contravenes or conflicts with any applicable Law, Order, or Permit in any material respect (any such event, a “Regulatory Termination Event”), in each case subject to the right of Servicer to cure such breach, violation, contravention, conflict or restriction within 30 days after Servicer receives notice of the Regulatory Termination Event, to the extent that Lender reasonably believes such Regulatory Termination Event is curable by Servicer. In the event of a termination, Lender shall continue to be obligated to fund all unfunded Loans that conform to the Credit Policy approved on or before the day prior to the termination date set forth in the notice of the Regulatory Termination Event unless otherwise prohibited from doing so by the Governmental Authority. In the event Lender receives a binding and valid cease and desist order or other Order from a Governmental Authority preventing it from lawfully funding and originating Loans under this Loan Origination Agreement, the cure periods set forth above in this Section 6.05 will not apply, and Lender may immediately cease its originating and funding Loans under this Loan Origination Agreement.
Regulatory Termination Event. (a) Without limiting any other Section herein, if a Regulatory Termination Event occurs prior to the Base Term Commencement Date, then either Lessor or Construction Agent may elect to terminate Construction Agent’s rights under this Agreement and the Lease by giving written notice (a “Regulatory Termination Notice”) to the other party (within sixty (60) days of such party obtaining knowledge of the Regulatory Termination Event, with such termination to be effective as of the Payment Date referred to below in this Section 3.5(a)) that, as a consequence of such Regulatory Termination Event, Construction Agent’s rights under this Agreement and the Lease are to be terminated, and Construction Agent shall be obligated to pay to Lessor the Lease Balance (including all accrued but unpaid Yield) plus, without duplication, all Breakage Costs, on or prior to the next Payment Date occurring no earlier than thirty (30) days and no later than sixty (60) days from the date of Construction Agent’s receipt or delivery of such Regulatory Termination Notice); provided, however, that if Construction Agent fails to pay the Lease Balance (including all accrued but unpaid Yield) plus, without duplication, all Breakage Costs, as and when due, then a Construction Agency Agreement Event of Default shall be deemed to have occurred, and Lessor shall be entitled to exercise its remedies pursuant to Section 5.3.
(b) On the date of, and concurrent with, the payment by Construction Agent of the Lease Balance (including all accrued but unpaid Yield) plus, without duplication, all Breakage Costs, in accordance with Section 3.5(a) (such date, the “Regulatory Event Termination Date”), (i) Lessor and Construction Agent shall comply with the provisions of Section 15.2 of the Lease (including Sections 21.1(i) through (iii) and Section 21.1(v) of the Lease) and (ii) the Leased Property shall be conveyed to Construction Agent as provided in such Sections.