ipso facto clause
- A provision in an agreement outlining the results (like the ending of a lease or early demand of payment) when one party becomes insolvent
- The ipso facto clause in their contract stated that if one party went bankrupt, the other party could terminate the agreement immediately.
- To prevent unexpected financial losses, the bank included an ipso facto clause in the loan contract.
- During the drafting of the agreement, the attorney suggested the inclusion of an ipso facto clause to protect their client's interests in case of financial hardship faced by the other party.