promise, commonly found in the form of restrictions in a loan agreement imposed on the borrower to protect the lender's interest. Examples of typical restrictive provisions are a ceiling on dividends and the required maintenance of a minimum working capital.

promise, commonly found in the form of restrictions in a loan agreement imposed on the borrower to protect the lender's interest. Examples of typical restrictive provisions are a ceiling on dividends and the required maintenance of a minimum working capital.

provision(s) in a contract that some or all terms of the contract will be altered or cease to exist upon a certain event.

Example: If a house is destroyed by fire before closing, the buyer is not obligated to complete the purchase.

Example: If a loan that is described as a condition cannot be arranged, the buyer is not required to complete the transaction and may receive a refund of any earnest money.

clause in a deed that limits the use of land. For example, a deed might stipulate that alcoholic beverages are not to be sold on the land for 20 years. Restrictions that are against public policy are unenforceable, such as those that prohibit people of certain ethnic groups from using a property.