Troubled Condition Clause Samples
The "Troubled Condition" clause defines the circumstances under which a party, typically a financial institution or business, is considered to be experiencing significant financial or operational distress. This clause outlines specific criteria or events—such as regulatory intervention, insolvency proceedings, or failure to meet certain financial thresholds—that trigger the designation of a troubled condition. For example, if a bank falls below required capital ratios or is subject to enforcement actions, it may be classified under this clause. The core function of the "Troubled Condition" clause is to provide a clear standard for identifying when a party is at risk, thereby enabling other contractual provisions—such as enhanced oversight, reporting requirements, or early termination rights—to be activated in response to heightened risk.
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Troubled Condition. If Borrower or Bank is notified by any Governmental Body that it is considered an institution in “troubled condition” within the meaning of 12 U.S.C. Section 1831i and the regulations promulgated thereunder, or if a conservator or receiver is appointed for Bank.
Troubled Condition. Any Depository Institution Subsidiary is notified that it is considered an institution in “troubled condition” within the meaning of 12 U.S.C. Section 1831i and the regulations promulgated thereunder, or if a conservator or receiver is appointed for the Depository Institution Subsidiary.
Troubled Condition. The Credit Union is now deemed in “troubled condition” as defined by Section 701.14 of the NCUA Rules and Regulations. Therefore, the Credit Union must comply with Section 701.14 of the NCUA Rules and Regulations by submitting appropriate documentation to the Division and the NCUA containing applications of any proposed changes in the Board of Directors, committee members, or senior executive staff, 30 days prior to the effective date of any changes, and obtain approval from both agencies.