Transfer Upon Realization of Pledged, Mortgaged or Charged Escrowed Securities Clause Samples
This clause defines the process by which escrowed securities that have been pledged, mortgaged, or otherwise charged as collateral are transferred upon the realization or enforcement of those security interests. In practice, if a lender or secured party enforces their rights due to a default, the escrow agent is authorized to release and transfer the relevant securities to the secured party or their nominee. This ensures that the interests of secured parties are protected and that the transfer of collateral can occur smoothly and efficiently, thereby facilitating the enforcement of security interests without unnecessary delay or dispute.
Transfer Upon Realization of Pledged, Mortgaged or Charged Escrowed Securities. (1) You may transfer within escrow to a financial institution the Escrowed Securities you have pledged, mortgaged or charged under section 4.2 to that financial institution as collateral for a loan on realization of the loan.
(2) Prior to the transfer the Escrow Agent must receive:
(a) a statutory declaration of an officer of the financial institution that the financial institution is legally entitled to the Escrowed Securities;
(b) a transfer power of attorney, executed by the transferor in accordance with the requirements of the Issuer’s transfer agent; and
(c) an acknowledgement in the form of Schedule “B” signed by the financial institution.
(3) Within 10 days after the transfer, the transferee of the Escrowed Securities will file a copy of the acknowledgment with the securities regulators in the jurisdictions in which the Issuer is a reporting issuer.