Acceleration Clause
Categories: Board of Directors, Company Management, Company Valuation, Regulations
A clause in a nasty lender's contract that says, "If you ever don't have at least a 3:1 debt to EBITDA ratio, or you don't have at least 4% revenue growth, or you don't have a full supply of green M&Ms in the lobby (meaning five full bowls), then we have the right to accelerate demands for you to repay our loan. Take it or leave it." And yeah...why would companies take it? Because they had to. They were desperate and had no other choice. Kids, don't let this happen to you.
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