Default is the occurrence of an event or circumstance against which a party to a contract seeks protection.
For example, a contract may state that the recording of a lien against certain property is a default.
If the default is left uncured after notice and the passage of time, it may ripen into an event of default, which creates in the non-defaulting party certain rights, such as acceleration of a debt or the right to exit a contract.
In a revolving credit facility, the occurrence of an event of default normally also allows the lender to cancel any obligations to make further loan advances.
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