Collateral Exam Clause Samples
A Collateral Exam clause establishes the right of a party, typically a lender, to inspect or examine the collateral securing a loan or obligation. In practice, this means the lender may periodically review the condition, location, or value of assets such as inventory, equipment, or real estate that serve as collateral. This clause ensures the lender can verify that the collateral remains sufficient and properly maintained, thereby reducing the risk of loss and protecting their security interest in the event of borrower default.
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Collateral Exam. Within 180 days after the Closing Date and at such other times as reasonably requested, the Borrowers shall permit the Agent or its designee to conduct a collateral field audit at the sole cost and expense of the Borrowers, and such collateral field audit shall be reasonably satisfactory to the Agent in scope and result; provided, however, that so long as no Default or Event of Default exists, the Agent shall not request more than two (2) collateral exams and two (2) inventory appraisals in any Fiscal Year. The Agent shall have obtained, at the Borrowers’ expense, results of (i) an updated field examination on or before September 28, 2013 and (ii) an updated inventory appraisal on or before March 29, 2014, each of which shall be used for, among other things, updating the Borrowing Base, and the parties hereto hereby agree that field exam and inventory appraisal shall not be included in determining the number of collateral exams and/or inventory appraisals requested in any fiscal year.
Collateral Exam. Upon request of the Bank, the Borrower shall permit the Bank to make collateral examinations as provided in the Security Agreement.
Collateral Exam. Within 180 days after the Closing Date and at such other times as reasonably requested, the Borrower shall permit the Agent or its designee to conduct a collateral field audit at the sole cost and expense of the Borrower, and such collateral field audit shall be reasonably satisfactory to the Agent in scope and result; provided, however, that so long as no Default or Event of Default exists, the Agent shall not request more than two (2) collateral exams and two (2) inventory appraisals in any Fiscal Year.
Collateral Exam. Borrower covenants and agrees with Lender that, while this Agreement is in effect, Borrower will permit employees or agents of Lender at any reasonable time, but at least annually, to inspect any and all collateral for the Loan or Loans, as well as B▇▇▇▇▇▇▇’s other properties and to examine or audit B▇▇▇▇▇▇▇’s books, accounts, and records and to make copies and memoranda of B▇▇▇▇▇▇▇’s books, accounts, and records as may be deemed necessary. Any such inspection or examination shall be at Borrower’s expense.
Collateral Exam. Section 6.20 of the Credit Agreement is amended to read in its entirety as follows:
Collateral Exam. Lender shall have the right to conduct a collateral exam at Borrower’s reasonable expense as needed.