Common use of Additions to Reserve Account Clause in Contracts

Additions to Reserve Account. If Bank has reason to believe that Merchant may be liable to customers or to Bank for Chargebacks exceeding the balance in the Reserve Account, Bank may: (A) immediately place in the Reserve Account payments due to Merchant and/or stop processing transactions for Merchant until such time as the extent of Merchant’s obligations to Bank, or Merchant’s liability for Chargebacks, or Merchant’s liability to customers are known, and Bank no longer deems itself insecure, and/or (B) demand from Merchant an amount that in Bank’s judgment is needed to ensure payment of Merchant’s obligations and liabilities. Merchant’s failure to pay any amount will permit Bank to terminate this Agreement immediately without advance notice.

Additions to Reserve Account. If Bank has reason to believe that Merchant may be liable to customers or to Bank for Chargebacks exceeding the balance in the Reserve Account, Merchant Bank may: (Aa) immediately place in the Reserve Account payments due to Merchant and/or stop processing transactions for Merchant until such time as the extent of Merchant’s obligations to Bank, or Merchant’s liability for Chargebacks, or Merchant’s liability to customers are known, and Bank no longer deems itself insecure, and/or (Bb) demand from Merchant an amount that in Bank’s judgment is needed to ensure payment of Merchant’s obligations and liabilities. Merchant’s failure to pay any amount will permit Merchant Bank or its designated representative to terminate this Merchant Agreement immediately without advance notice.