Bank Covenant Summary

![[bank-covenant-summary.svg|EX-24, bank covenant summary with underlined clauses]] The covenant summary is blunt in the way lenders can afford to be. If collateral falls too far, the bank can demand cash, reduce exposure, or liquidate enough positions to protect itself: clean verbs, clean consequences, language that does not negotiate with your self-image. Blackridge can manage its internal optics. It cannot negotiate with arithmetic, the part of the world that does not care whether you were disciplined, whether you were patient, whether you were waiting for confirmation. You read the summary until your eyes water. You underline a paragraph twice. You are learning the firm's weak points, and you are ashamed of how good it feels. [[Margin Call Consequence Note|Read the margin call consequence note]] <details> <summary>🔎 Behind the curtain: loan covenants</summary> A covenant is a promise written into a loan: a line the borrower agrees not to cross, such as keeping collateral above a set level. Break it and the lender gains rights it can use immediately, to demand more cash, force the borrower to shrink its positions, or sell assets to cover the loan. Covenants exist so the bank does not have to wait and hope; they turn a worrying trend into an automatic right to act. For Blackridge, the covenant is the trapdoor under the whole plan. Defender's lesson: know your own trapdoors. The contractual triggers that can be sprung in a crisis belong in your incident planning, not only in the legal file. </details>