Lockbox Procedures Clause Samples
The Lockbox Procedures clause establishes the process by which payments or funds are directed into a designated account, often managed by a third-party financial institution. Typically, this clause outlines how incoming payments are to be deposited, who has access to the account, and the order in which funds are distributed or applied to obligations. For example, it may require all customer payments to be sent directly to the lockbox, ensuring that the lender or secured party receives funds before the borrower can access them. The core function of this clause is to provide control and security over cash flows, reducing the risk of misappropriation and ensuring that creditors are paid in accordance with agreed priorities.
Lockbox Procedures. (a) In the event that either (i) the Tangible Net Worth of CCC is less than two hundred percent (200%) of the amount of the maximum liability under the Guarantee from time to time as of the end of each of three (3) consecutive Accounting Periods, or (ii) the Consolidated Coverage Ratio of CCC is less than 2.3 to 1.0 for each of three (3) consecutive Accounting Periods, or (iii) there is an Event of Default under Section 12.1(a)(i), 12.1(c) (by reason of a breach of Section 7.1 or 21.6.3), 12.1(f), 12.1(g), 12.1(h), 12.1(i), 12.1(k), or 12.1(m) of this Lease, or (iv) there is a default continuing beyond any applicable cure period under Section 12.1(a)(i) or Section 12.1(c) (by reason of a breach of Section 7.1 or 21.6.3) of any Pool Lease (other than this Lease) or any Other Lease with respect to which CCC Limit of Liability under any CCC guarantee applicable to such Other Lease is greater than zero, then, at Landlord's option and upon Notice to Manager and Tenant (the date of such notice, the "LOCKBOX NOTICE DATE"), the procedures set forth in this Section 3.5 shall apply during the period beginning no later than two (2) weeks after the Lockbox Notice Date and continuing thereafter until the first (1st) day of the first (1st) full Accounting Period after (w) the Tangible Net Worth of CCC is at least equal two hundred percent (200%) of the maximum liability under the Guarantee from time to time as of the end of each of three (3) consecutive Accounting Periods, (x) the Consolidated Coverage Ratio of CCC is at least 2.3 to 1.0 for each of three (3) consecutive Accounting Periods, (y) no Event of Default under Section 12.1(a)(i), 12.1(c) (by reason of a breach of Section 7.1 or 21.6.3), 12.1(f), 12.1(g), 12.1(h), 12.1(i), 12.1(k), or 12.1(m) of this Lease has been in effect as of the end of each of three (3) consecutive Accounting Periods, or (z) there has been no default continuing beyond any applicable cure period under Section 12.1(a)(i) or Section 12.1(c) (by reason of a breach of Section 7.1 or 21.6.3) of any Pool Lease (other than this Lease) or any Other Lease with respect to which CCC Limit of Liability under any CCC guarantee applicable to such Other Lease is greater than zero, as of the end of each of three (3) consecutive Accounting Periods (such period, a "LOCKBOX PERIOD"). At any time after the termination of the Guarantee pursuant to Section 10 thereof, a Lockbox Period shall commence pursuant to this subsection (a) only if there is an Event of D...
Lockbox Procedures. (a) Bank shall establish a unique U.S. Postal Service address (“Lockbox”) to be used for remittances which are to be deposited into a Blocked Deposit Account pursuant to this Agreement (as designated by Lender or Borrower, as the case may be) and shall promptly notify Borrower and Lender in writing of such address. Bank shall have exclusive and unrestricted access to, and use of, the Lockbox for the purpose of handling such remittances in accordance with this Agreement. Bank will collect, open and process for deposit all mail received in the Lockbox in accordance with the procedures set forth on Exhibit A attached hereto. Borrower shall be responsible for all fees associated with the Lockbox and Deposit Account, as may be charged by the Bank pursuant to the Lockbox terms and conditions and its schedule of fees and charges, applicable to customers generally, as may be amended from time to time.
(b) The parties agree that items deposited in the Deposit Account shall be deemed to bear the valid and legally binding endorsement of the payee and to comply with all of Bank’s requirements for the supplying of missing endorsements, now or hereafter in effect. As between Borrower and Lender, any deposit made by or on behalf of Borrower into a Blocked Deposit Account shall be deemed deposited into such account when the funds in respect of such deposit shall become collected funds.
(c) Bank shall redeposit without advice any item returned for any reason. If any item is returned a second time, Bank will charge the amount of such item and its current standard charge for returned items against the Blocked Deposit Accounts if any such account contains sufficient funds to pay the amount of the returned item and the returned item charges. If the balance in the Blocked Deposit Accounts is not sufficient to pay the amount of the returned item and the returned item charges, Bank shall notify Lender and Borrower. Within five (5) business days of such notification, Borrower agrees to reimburse Bank for same. In the event Borrower does not reimburse Bank, the Bank may charge the amount of such items and charges to any Blocked Deposit Account, provided however, that Lender shall be liable to Bank only for amounts actually paid to Lender which are not recovered by Bank in accordance with the preceding sentence. Bank shall return the item along with the debit advice to Borrower.
(d) Bank is granted the further right to debit from the Blocked Deposit Account any amounts deposited the...
Lockbox Procedures. A) Differences in Amount If the script and numerical amounts themselves do not agree, yet one of these amounts agrees with the invoice amount, credit for the invoice amount. If there is no invoice, or if neither the script or numerical amount agree with the invoice amount, credit for the script amount.
B) Checks Marked "Paid-in-Full" Reject these checks
C) Correspondence, Orders, Etc., Received Left in original envelope, marked with "correspondence" stamp, and sent to the company, with a copy to CHF as indicated in Mailing Instructions below.
Lockbox Procedures. Differences in Amount If the script and numerical amounts themselves do not agree, yet one of these amounts agrees with the invoice amount, credit for the invoice amount. If there is no invoice, or if neither the script or numerical amount agree with the invoice amount, credit for the script amount.
Lockbox Procedures. (a) In the event that either (i) the Tangible Net Worth of CCC is less than the Minimum Net Worth as of the end of three (3) consecutive Accounting Periods, or (ii) the Consolidated Coverage Ratio of CCC is less than 1.7 to 1.0 for three (3) consecutive Accounting Periods, or (iii) the Tangible Net Worth of CCC is less than two hundred percent (200%) of the amount of the maximum liability under the Guarantee from time to time as of the end of each of three (3) consecutive Accounting Periods, or (iv) there is an Event of Default under Section 12.1(a)(i) or a payment default (continuing beyond any applicable cure period) under any Other Lease subject to the Pooling Agreement, then, at Landlord's option and upon Notice to Manager and Tenant (the date of such notice, the "Lockbox Notice Date"), the procedures set forth in this Section 3.5 shall apply during the period beginning no later than two (2) weeks after the Lockbox Notice Date and continuing thereafter until the first (1st) day of the first (1st) full Accounting Period after (w) the Tangible Net Worth of CCC is at least equal to the Minimum Net Worth as of the end of each of three (3) consecutive Accounting Periods, (x) the Consolidated Coverage Ratio of CCC is at least 1.7 to 1.0 for three (3) consecutive Accounting Periods, (y) the Tangible Net Worth of CCC is at least equal to two hundred percent (200%) of the maximum liability under the Guarantee from time to time as of the end of each of three (3) consecutive Accounting Periods, and (z) no Event of Default under Section 12.1(a)(i) or payment default (continuing beyond any applicable cure period) under any Other Lease subject to the Pooling Agreement has been in effect as of the end of each of three consecutive Accounting Periods (such period, a "Lockbox Period").
(b) Following the Lockbox Notice Date and prior to commencement of the Lockbox Period, Landlord (or, if required by the terms of any Facility Mortgage, any Facility Mortgagee or its agent) shall establish and maintain a cash collateral account at a financial institution mutually acceptable to Landlord and Tenant (the "Lockbox Account"), as a segregated account in the name of Landlord (or, if applicable, the Facility Mortgagee or its agent), into which all revenues of Tenant due from Manager to Tenant or paid by Landlord to Tenant hereunder that are to be held as security for Tenant's obligations under this Lease shall be deposited.
Lockbox Procedures. (a) Servicer shall cause all mail addressed and delivered to the Lockbox Account to be removed and inspected. If any such mail is something other than a Tenant Payment or contains any notice or other correspondence from the sender of the Tenant Payment, Servicer shall promptly send such letter, documents, notice or other correspondence to Borrower. So long as Servicer's prior consent is obtained, Tenant Payments may be remitted to Servicer by wire transfer.
(b) Servicer shall cause all Tenant Payments received to be deposited into the Lockbox Account. Servicer shall maintain the Lockbox Account for the benefit of the Lender and all funds deposited therein shall be for the account of Servicer, subject only to the rights of Lender with respect thereto. Servicer, as Lender's agent, shall have sole and exclusive dominion and co▇▇▇▇▇ over the Lockbox Account, all funds held therein and all proceeds thereof. Borrower shall not have any right thereto or interest therein and shall have no authority to withdraw funds from Lockbox Account. The funds on deposit in Lockbox Account shall be disbursed or applied only as specified in this Agreement.