Additional Collateral or Guaranties Clause Samples
The "Additional Collateral or Guaranties" clause requires a borrower or obligor to provide extra security or guarantees beyond the initial agreement if certain conditions are met. This may involve pledging more assets, obtaining third-party guarantees, or otherwise enhancing the lender's security interest, often triggered by changes in the borrower's financial condition or the value of existing collateral. The core function of this clause is to protect the lender by ensuring sufficient security for the loan, thereby mitigating the risk of loss if the borrower's creditworthiness deteriorates.
Additional Collateral or Guaranties. None of the Holders shall accept a security interest in, or a Lien on, any collateral for the Obligations other than such Holder’s beneficial interest in the security interest in, and Lien on, the Collateral granted to the Collateral Agent under the Collateral Documents; provided, however, that nothing contained in the foregoing shall be construed as prohibiting the opening and maintenance of deposit accounts for the account of the Parent Issuer or Guarantors in the ordinary course of business. No Holder shall accept any guaranty of its Obligations from any Person unless such Person has previously or simultaneously guaranteed the Obligations held by each of the other Holders.