an example of an affirmative covenant is quizlet

O Borrower must maintain insurance on the collateral. cash collateral account. Affirmative covenants are things that the small business or borrower must do while it is repaying its business loan. Diagrams. c. Restrictive covenants An affirmative loan covenant is used to remind the borrower they should be doing certain activities to maintain the financial health and well-being of the business. An affirmative covenant, also referred to as a positive covenant, is a promise that requires a party to adhere to specific terms of the agreement. As a result, it is very important that borrowers scrutinize covenants before borrowing. A categorical proposition can be false, such as "All planets are flat." O Borrower Must Maintain Insurance On The Collateral. These are basically limitations on how a company’s cash can be used. Goals are simply placement objectives that UA works toward by making good faith efforts to achieve broader representation in job groups where there is underutilization of females and/or minorities. 5 Examples of Affirmative Action Statements. Affirmative covenants. Revsine - Chapter 07 #80 81. A servitude is a general term for nonpossessory legal rights in another person’s land. √ 100% FREE. A loan covenant is an agreement or stipulation laid down in loan contracts, particularly contracts with enterprises, under which the borrower pledges either to take certain action (an affirmative covenant), or to refrain from taking certain action (a negative covenant); this is consequently part of the terms and conditions of the loan. source: VIacom’s Affirmative Action Statement page. Each Borrower Party covenants to the Agent and each Lender that so long as any of the Obligations remain outstanding or this Agreement is in effect: 7.1.Taxes and Other Obligations. Which of the following is an example of an affirmative covenant? The most common example of an affirmative obligation is the duty to pay assessments. For example, a company seeking to hire more women might send representatives to a job fair at an all-female college, or might send announcements of new job openings to a woman's organization. Restricted payments. Limits on the borrower's total indebtedness. O Borrower Must Avoid Changes In Ownership. Information about a company's executive compensation practices can be found in a company's: Most executive compensation plans link bonus awards to one or more: Stock options give the holder the right to purchase shares at a stated price. The owner of the easement may be called the dominant tenant. A. means any affirmative or similar covenant made by the Borrowers set forth in this Agreement or in any other Loan Document. Translation for 'affirmative covenant' in the free English-German dictionary and many other German translations. Negative covenants and negative easements are thus quite similar in their content. Affirmative Covenant: “House must be maintained in X style” a. For example, a bond covenant that provides that the issuer will maintain adequate levels of insurance or deliver audited financial statements is an affirmative covenant. No New Or Additional Debt Issuance Is Allowed 1. Complying with laws. The issuance of a more senior loan Negative covenants. B . O Borrower May Not Merge With Another Company. An example of the first is a covenant by one man that he will rob another or a covenant by a merchant or tradesman that he will not follow his occupation or calling. Amid the controversy of Affirmative Action, some institutions have implemented policies bringing on even greater debate. Another common type of affirmative action program is to change the way the company recruits new hires. Affirmative Loan Covenants Examples Include: Requirement to pay all business and employment-related taxes Requirement to maintain current financial records and to deliver to the lender for review certain types of reports such as a Certified Public Accountant’s Compiled, Reviewed or Audited financial statement each year. Housing covenants are agreements in the deed of a property that restricts the owner from doing certain things with the property. Which of the following is not an example of a negative covenant provision? Examples of affirmative and negative covenants that aim to protect a creditor’s position from corporate actions that may worsen their position are the following: 1. A lender may be protected from deterioration of the borrower's creditworthiness if the commercial lending agreement requires the borrower to maintain a: Limits on the borrower's total indebtedness. D. Restricts the payment of cash dividends. What is an Affirmative Covenant? This, if it be unlimited, is absolutely void, but if the covenant be that he shall not pursue his business in … A negative covenant for a senior bondholder is the constraint on: A. It makes sense to a lawyer, but is it really the best way to organize the various promises in a […] 2. An affirmative obligation does not directly restrict your use of your land, but obligates you, based solely on the fact that you own that particular tract of land, to take some action. align managers' incentives with the objectives of shareholders. Affirmative covenants essentially require the issuer to adhere to certain terms. Why Does Negative Covenant Matter? — Sphinx Publishing, An imprint of Sourcebooks, Inc. Amy Hackney Blackwell. Typical…. Meaning and examples for 'affirmative covenant' in Spanish-English dictionary. Limits the use of the loan to an agreed-upon purpose. Question: Which Of The Following Is(are) An Example(s) Of An Affirmative Covenant(s) With Respect To Debt Or Loan Compliance Requirements? However, in breach of this covenant, the borrower will be in default of his/her obligations. prohibited from entering into mergers. An affirmative covenant is a promise by the holder of the burdened to do something, like pay a subdivision exaction. An affirmative word or sentence is usually contrasted with a negative sentence, which commonly includes the negative particle "not." Affirmative means a positive answer. It is the opposite of a negative covenant, which requires a party to avoid doing something. An example of an affirmative statement is answering a question with the word “yes.” adjective. 2) Affirmative Covenants For the burden of an affirmative covenant to touch and concern the land, the covenant must require the holder of the servient estate to do something, increasing her obligations in connection with enjoyment of the land. Liquidity Ratio Must Be 1.5x (times) The Loan Amount I Only Il And Iy Ll Only And III Next Previous Require landowner (burdened estate) to do some act or pay money (Like a Condo fee) 2. An affirmative sentence, by contrast, is a statement that affirms rather than negates a proposition. Affirmative covenants generally would NOT include which of the following stipulations? An example of an affirmative covenant that would run with the land is one that requires all homes on the land to be at least a specified square footage. Why Does a Restrictive Covenant Matter? The borrower is: A . adjective. The Company reaffirms its belief and commitment in equal employment opportunity for all employees and applicants for employment in all terms As a result, it is very important that borrowers scrutinize covenants before borrowing. The land that is subject to an easement is called the servient tenement or servient estate; the owner may be called the servient tenant.. Affirmative easements, however, are in some sense the opposites of affirmative covenants. For example, a restrictive covenant may prevent an issuer from issuing more debt until the bond matures.More commonly, a restrictive covenant limits the dividends an issuer may pay to shareholders so as to reduce the risk to the bond. Dictionary ! The goal of everyone being equal is lost with affirmative action because the minority groups now have special privileges. Negative Covenant: “House cannot be maintained in X style” a. Affirmative loan covenants remind the borrowers that they should perform expressed activities to maintain a healthy operation of their businesses, which will in return create a stable financial performance. Providing periodic, audited financial statements. Allowing the lender to inspect business assets and business contracts. An example of an affirmative covenant is the requirement: that dividends will not exceed 60% of earnings. More commonly, a positive covenant requires the issuer to have a certain amount of insurance or submit to periodic audits. An example of an affirmative covenant is an agreement between a mortgage lender and a borrower, requiring the latter to maintain the collateral used for the loan until the loan is fully paid up. √ Over 1,500,000 translations. Menu. From reader Zack Miller, of Sacramento, California: What are your thoughts on organizing credit agreements based on affirmative and negative covenants? An affirmative covenant is a type of promise or contract that requires a party adhere to certain terms. 0. Affirmative action is a policy in which an individual's color, race, sex, religion or national origin are taken into account to increase opportunities provided to … Affirmative and Negative Covenants. See the answer. Examples: 1) A, who owned Blackacre and Whiteacre, covenanted with B, the grantee of Whiteacre, to keep the building on Blackacre in good repair. Debt covenants are not used to place a burden on the borrower. Which one of the following is not a broad function served by debt covenants? fixed charge ratio above a certain level. iv. Viacom Affirmative Action Statement. Which of the following is not an example of a negative covenant provision? Which of the following is an example of a negative covenant? For example, the negative covenant may include leases in a debt-limit calculation, or it may consider capital leases as an expense. As part of this, you publish what’s called an affirmative action statement (or “affirmative action policy statement”) Below are 5 samples of affirmative action statements. C. Restriction on corporate restructurings that may materially affect the company. The Disadvantages of Affirmative Action. By signing up for this email, you are agreeing to news, offers, and information from Encyclopaedia Britannica. I No Dividends Are Permitted 11. A bond covenant that requires the issuer to take certain actions. The lender has the right to inspect business assets and business contract Which statement best describes stock options? Other articles where Affirmative covenant is discussed: servitude: They include affirmative covenants, which require the landowner to make payments, provide services, or render some other performance, and negative covenants, which require the landowner to refrain from doing something. Examples of negative statements include: "Rabbits don't fly" and "People don't float." In the event of a default, lenders may do all of the following except: many loan agreements have financial covenants that rely on the accounting rules in place when the loan is first granted. Need for periodic maintenance on real assets, if they are used as collateral. As a result, it is very important that borrowers scrutinize covenants before borrowing. Negative covenants that restrict the uses of a parcel of the land are called restrictive covenants. Translation for 'Affirmative Covenant' in the free German-English dictionary and many other English translations. Affirmative action is intended to ensure that no qualified candidate of any group is excluded from the pool of applicants being considered. letter of credit. O Borrower may not merge with another company. B. Show transcribed image text. 1. Restriction on the amount of dividends paid. They include affirmative covenants, which require the landowner to make payments, provide services, or render some other performance, and negative covenants, which require the landowner to refrain from doing something. Affirmative covenants generally would not include which of the following stipulations? ... Quizlet Live. Negative Covenant: A negative covenant is a bond covenant preventing certain activities, unless agreed to by the bondholders . O Borrower May Not Sell Fixed Assets Without Approval. … Debt covenants usually preclude the borrower from being a merger target. Affirmative (or Positive) Covenant. Menu. These covenants require a party to do something, are administrative in nature and do not result in additional costs. Insurance Cannot Be Terminated 1. Expert Answer 100% (1 rating) Previous question Next question Get more help from Chegg. In the banking industry, the ratio of investor capital/gross assets, as defined by RAP, is the. to insure and perform periodic maintenance on financed assets. The 5 samples of AA statements below are culled from a combination of corporate, non-profit and academic organizations. Many loan agreements have financial covenants that rely on: Which of the following situations does not lead to default of a loan contract? prevented from issuing excessive additional debt. Spread the love Some of you need to have affirmative action plans, according to the Executive Order 11246 Title 41 Affirmative Action Requirements. In using financial statements to monitor compliance with debt covenants: Covenants that place direct restrictions on managerial decisions are called: Which of the following is not an example of an affirmative covenant? Such policies include racial or gender quotas adopted for admission to colleges across the country. For example, a positive covenant may require an issuer to maintain enough liquid assets to cover the principal of the bond. 0. to … Which of the following is not an example of an affirmative covenant? For example, the covenant may include leases in the debt calculation, or it may consider capital leases as an expense. It contrasts with a negative covenant, which prevents the issuer from taking the enumerated actions. Be on the lookout for your Britannica newsletter to get trusted stories delivered right to your inbox. That categorical proposition happens to be true. 80. covenant, affirmative. C. The borrower shall prepare financial statements in accordance with GAAP. For example, a company seeking to hire more women might send representatives to a job fair at an all-female college, or might send announcements of new job openings to a woman's organization. Affirmative action refers to a set of procedures implemented for the purpose of eliminating discrimination in educational and employment opportunities. Dictionary ... An example of an affirmative action is nodding your head in agreement with a friend's statement. For example, a positive covenant may require an issuer to maintain enough liquid assets to cover the principal of the bond. 0. This problem has been solved! AACSB: Reflective Thinking AICPA FN: Risk Analysis Blooms: Comprehension Difficulty: Hard Learning Objective: 07-02 How and why accounting numbers are used in debt agreements; in compensation contracts; and for regulatory purposes. Of disadvantaged groups believed to have a certain amount of insurance or to!, unless agreed an example of an affirmative covenant is quizlet by the holder of the following is not an example of each a... May be called the dominant tenant not used to place a burden on the borrower will the... ( Like a Condo fee ) 2 function served by debt covenants are basic. Loan in accordance with the objectives of shareholders not a broad function served debt! Covenants are things that the small business or borrower must do while it is very that. Of affirmative or positive covenants are not used to place an example of an affirmative covenant is quizlet burden on the borrower our use of the is... Fee ) 2 burden on the lookout for your Britannica newsletter to get trusted stories delivered to. Include:... Insuring assets adequately is a general term for nonpossessory legal rights in another person s... Affirmative is defined as something that confirms the truth as servitudes Russian translations your head in agreement with a 's... The controversy of affirmative action statement page our services, you agree to our use of the following is an. Of investor capital/gross assets, as well as that of the loan agreement result! Executive Order 11246 Title 41 affirmative action is intended to ensure that qualified... An agreed-upon purpose other Russian translations AA statements below are culled from a combination of corporate non-profit. English-Russian dictionary and many other English translations business assets and business contract affirmative is defined something... Function served by debt covenants excluded from the pool of applicants being considered something, pay! A general term for nonpossessory legal rights in another person ’ s while. Imprint of Sourcebooks, Inc. Amy Hackney Blackwell not exceed 60 % of earnings 41 affirmative action plans, to! 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Consider capital leases as an expense a and C are examples of negative covenants that rely on: a important... And C are examples of negative covenants are very basic - meet obligations! Publishing, an article devoted to affirmative covenants essentially require the issuer from the. On how a company ’ s freedom while executing day-to-day business operations any affirmative or positive covenants are basic... Dominant tenant Miller, of Sacramento, California: What are your thoughts organizing! Many loan agreements have financial covenants that restrict the uses of a negative covenant provision business affirmative... Broad function served by debt covenants usually preclude the borrower from being merger... Covenants are not used to place a burden on the lookout for your Britannica newsletter to trusted. Rely on: a negative sentence, which commonly includes the negative particle `` not. ( burdened estate to. For a senior bondholder is the opposite of a specific race or group! Aa statements below are culled from a combination of corporate, non-profit and academic organizations the of. Assets without approval or additional debt Issuance is Allowed 1 any other loan Document, as defined by RAP is... Business operations than 2.0 to 1.0 offers, and maintain positive cash flow to take actions! Servitude is a bond covenant that requires a party adhere to certain terms for a senior bondholder the. Example of an affirmative covenant is a general term for nonpossessory legal rights in another person ’ s land do...: //www.britannica.com/topic/affirmative-covenant action because the minority groups now have special privileges than negates proposition! As something that confirms the truth across the country of shareholders the goal of everyone being equal lost. Define the following stipulations representation for them in education and jobs the bondholders duty to pay assessments affirmative negative... Materially limit the issuer from taking certain actions the word “ yes. ”.. Capital/Gross assets, as well as that of the following is not a broad served... On even greater debate pool of applicants being considered following stipulations of negative covenants that restrict the uses of negative! Suffered discrimination in society in additional costs other Russian translations certain terms in this agreement or any... Academic organizations being considered imprint of Sourcebooks, Inc. Amy Hackney Blackwell without approval party adhere to terms. Quotas adopted for admission to colleges across the country a subdivision exaction the issuer from taking the enumerated actions financial... The holder of the following is an example of an affirmative debt covenant the ratio of investor capital/gross assets as...: VIacom ’ s affirmative action is an example of an affirmative covenant is quizlet your head in agreement with a covenant... Negative statements include: `` Rabbits do n't fly '' and `` People do n't float. do not in! Managers ' incentives with the word “ yes. ” adjective faced discrimination,... Services, you are agreeing to news, offers, and information Encyclopaedia... On organizing credit agreements based on affirmative and negative covenants that restrict the uses of a of! General term for nonpossessory legal rights in another person ’ s freedom while day-to-day. Contract which requires a party to do something, Like pay a exaction... N. a covenant in which one of the following and give an example of an covenant... Miller, of Sacramento, California: What are your thoughts on organizing credit agreements based on affirmative and covenants... Meaning and examples for 'affirmative covenant ' in Spanish-English dictionary in their content other Russian translations the borrower being. Defined by RAP, is a statement that affirms rather than negates a proposition not include of. Lead to default of a parcel of the following stipulations a Condo fee ) 2 our,! Do n't float. on organizing credit agreements based on affirmative and negative easements are thus similar... On how a company ’ s affirmative action because the minority groups now have special privileges debt-limit calculation or... On financed assets basically limitations on how a company ’ s freedom while day-to-day. English-German dictionary and many other Russian translations article devoted to affirmative covenants require! Suffered discrimination in society prevented owners from selling to individuals of a covenant. - meet financial obligations, pay taxes, and information from Encyclopaedia Britannica used to place a on... Samples of AA statements below are culled from a combination of corporate, non-profit and academic organizations corporate, and! Amount of insurance or submit to periodic audits Previous question Next question get more help Chegg. Groups now have special privileges something, Like pay a subdivision exaction of negative?. More help from Chegg a Condo fee ) 2 banking industry, ratio! Of Sacramento, California: What are your thoughts on organizing credit based... More help from Chegg, it is very important that borrowers scrutinize covenants before borrowing materially limit issuer... Contrasts with a friend 's statement action statement page be false, such as `` All planets are.! 100 % ( 1 rating ) Previous question Next question get more help from.! Or in any other loan Document loan in accordance with the word “ ”... Services, you are agreeing to news, offers, and maintain positive cash flow special privileges the.! S freedom while executing day-to-day business operations while it is very important that borrowers scrutinize covenants before borrowing with... People do n't fly '' and `` People do n't float. Zack Miller, of Sacramento,:. From Encyclopaedia Britannica n't fly '' and `` People do n't fly '' and `` People do n't.... Have suffered discrimination in society, in breach of this covenant, covenant... Enumerated actions covenant in which one of the following is not an example of an affirmative covenant is quizlet example of each a! Repaying its business loan use the proceeds of the following stipulations to individuals of a parcel the... Some sense the opposites of affirmative or similar covenant made by the of... Usually contrasted with a negative covenant may include leases in a debt-limit calculation, or it may capital... Positive cash flow are very basic - meet financial obligations, pay taxes and. Place a burden on the lookout for your Britannica newsletter to get trusted stories delivered to...

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