Common Terms Agreement Vs Facility Agreement In California
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Common Terms Agreements clarify and simplify the multi-sourcing of project loans and ensure that the parties have a common understanding of key definitions and critical events.
Noun. : a lease, rental agreement, or other contractual agreement governing the acquisition, use, or disposition of government-owned machinery, tools, building installations, or other property furnished to or acquired by a war contractor for war production purposes other than incorporation in a finished product.
A Facilities Use Agreement is a contract, but it is not a lease and cannot have the characteristics of a lease. Rather it is a contract that extends a license to someone who has no other right to use the property. Such a license allows use of the property for a specific time and purpose.
A facility agreement usually sets out detailed conditions a borrower is required to fulfil prior to a lender advancing any funds. Certain conditions may apply to the initial drawing, and other conditions to subsequent drawings under a facility.
An agreement and a contract share the fundamental purpose of establishing mutual obligations between parties, yet they differ in their legal implications and formalities.
A purpose clause is a simple statement of intent that appears at the beginning of a part or subpart either as stand-alone section or as part of another section. The purpose clause is used to help the reader interpret the regulations.
Common Terms Agreement The CTA is an agreement among the financing parties and the borrower which sets out the terms that are common to all tranches of debt including definitions, conditions precedent, covenants, events of defaults and various miscellaneous provisions.
EA clauses are intended to prevent claims arising from statements made or information provided before a contract is signed. They are not to be relied upon for statements, etc made after signature.
The Facilities available under this Agreement shall be used by the Borrower for the purpose of working capital of the Borrower or any other purpose in the normal course of business, including the repayment of outstanding indebtedness.