Security Cover Clause Samples
The Security Cover clause establishes requirements for a party to provide and maintain a specified level of financial security or collateral, such as a bank guarantee or insurance, to support its obligations under the contract. Typically, this clause details the acceptable forms of security, the amount required, and the conditions under which the security may be drawn upon or released. Its core practical function is to protect the other party from potential losses due to non-performance or default, thereby allocating risk and ensuring financial assurance throughout the contract term.
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Security Cover. The Borrower shall ensure that the Loan is fully covered by the value of the Security less the market value of the Plant, Machinery and Equipment purchased. If at any time the value of the security cover falls below the amounts disbursed under the Term Loan Facility, the Borrower shall forthwith inform the Lender and repay the excess outstandings.
Security Cover. 24.1 Minimum required security cover
(a) Clause 24.2 (Provision of additional security; prepayment) applies if, the Facility Agent at any time following the Delivery Date, notifies the Borrower that the Security Cover Ratio is below 130 per cent.
(b) The Facility Agent shall test the minimum required security cover under this Clause 24.1 (Minimum required security cover) on each Testing Date and at any other time as the Facility Agent may require at the Finance Parties' expense (unless, as a result of such test, the Facility Agent determines that a Default has occurred and is continuing, in which case, at the expense of the Borrower).
Security Cover. As at the date hereof and at all times during the accounting period covered by the financial statements referred to above, the Security Value (as evidenced by the appraisal reports delivered pursuant to paragraph 1(d) above) plus the net realizable value of any additional Collateral previously provided under Clause 15 of the Loan Agreement was not less than [150 percent of the Loan]7 [157.5 percent of the Loan]8 [165 percent of the Loan]9.] [to be included along with appraisal reports]
Security Cover. Minimum required security cover
Security Cover. 15.1 Minimum required security cover. Clause 15.2 applies if the Agent notifies the Borrowers that:
(a) the aggregate of the market values (determined as provided in Clause 15.3) of the Ships then subject to a Mortgage; plus
(b) the net realisable value of any additional security previously provided under this Clause 15; is below One hundred and twenty five per cent.(125%)the Relevant Percentage of the Loans (provided however that Loans for these purposes shall exclude prior to the Delivery Date in respect of a Ship and the advance of its Delivery Advance, all Advances of the Loan for such Ship).
Security Cover. 15.1 Minimum required security cover
(a) the aggregate Market Value of the Ships subject to a Mortgage; plus
(b) the net realisable value of any additional security previously provided under this Clause 15, is below 125 per cent. of the Loan.
Security Cover. 47.1 The User shall provide Cover to the Company in accordance with the provisions of Schedule 1.
Security Cover. 26.1 Minimum required security cover
(a) Clause 26.2 (Provision of additional security; prepayment) applies if, on or after the first Utilisation Date, the Facility Agent notifies the Borrower that:
(i) the aggregate Market Value each Mortgaged Ship; plus
(ii) the net realisable value of additional Security previously provided under this Clause 26 (Security Cover), is below 125 per cent. of the aggregate of (i) the Loan and (i) the Hedging Close Out Liabilities.
(b) Valuations of the Ship from Approved Valuers shall be provided to, or obtained by, the Facility Agent in accordance with Clause 26.7 (Provision of Valuations) for the purpose of determining compliance with this Clause 26.1 (Minimum required security cover).
Security Cover. 24.1 Minimum required security cover
(a) Clause 24.2 (Provision of additional security; prepayment) applies if, at any time during the Security Period, the Facility Agent (acting on the instructions of the Majority Lenders) notifies the Borrowers that:
(i) the aggregate Market Value of the Ships; plus
(ii) the aggregate of the credit balances held on the Earnings Accounts; plus
(iii) the net realisable value of additional Security previously provided under this Clause 24 (Security Cover); is below the Relevant Percentage of the Loan.
(b) Compliance with this Clause 24 (Security Cover) will be tested on a quarterly basis throughout the Security Period and shall be evidenced by a Compliance Certificate (commencing with the financial quarter ending on 30 September 2020).
(c) In this Clause 24 (Security Cover):
Security Cover. 25.1 Minimum required security cover
(a) Clause 25.2 (Provision of additional security; prepayment) applies, if the Lender notifies the Borrowers that :(i) the aggregate Market Value of the Ships then subject to a Mortgage; plus the Minimum Liquidity Amount; plusthe Security Cover Ratio is below: