Equipment leases. Requires lessees of equipment to continue making rent payments to lessors, regardless of any defects in the leased goods or other performance problems with lessors, suppliers, or manufacturers of their obligations with respect to the leased goods.

Project Finance Transactions. An absolute commitment of a party to perform an action or obligation under an agreement with no contractual defense, including force majeure. This provision is included in take or pay contracts, where an offtaker has an unconditional obligation to pay for a product (for example, electricity from a power plant) or service (for example, transportation of gas or oil through a pipeline) even if the offtaker does not take delivery of the product or use the service. This provision is also included in leveraged lease transactions where the lessee must make all rental payments with respect to the leased property without regard to any defenses it may have against the lessor. In both cases, this provision is intended to ensure that the seller, service provider, or lessor receives payment for services rendered so that it can repay the non-recourse or limited loans it incurred to build the power plant or pipeline or acquire the leased property. For more information, see Practice Notes:

Mergers and Acquisitions. Commits buyers to undertake any obligations (including divestitures or litigation) that are required to obtain federal antitrust or other regulatory approval. Parties to a purchase agreement may negotiate this clause to allocate antitrust risk (see Standard Clause, Purchase Agreement: Hell or High Water Clause).

High-Yield Indentures. Describes issuers' (borrowers) permission to incur a specified amount of debt from third parties under a general debt basket in the indenture. This general debt basket (hell or high water basket) gives issuers flexibility and allows them to incur permitted debt regardless of limitations in the indenture that apply to other specific debt permissions, such as a requirement that issuers must satisfy a financial ratio test before they can incur debt. The only limitation on the issuer's ability to incur debt under a hell or high water basket is the size of the basket. For more information, see Standard Clauses, High-Yield Indenture: Limitation on Indebtedness Covenant.