Excluded Cash Collateral Clause Samples
The Excluded Cash Collateral clause defines specific types of cash or cash equivalents that are not subject to the security interest or lien granted under a financing or security agreement. Typically, this clause lists certain accounts or funds—such as payroll accounts, tax accounts, or other designated cash reserves—that are carved out from the lender’s collateral pool. By clearly identifying which cash assets are excluded, the clause ensures that both parties understand the limits of the lender’s claim, thereby preventing disputes and protecting the borrower’s ability to use certain funds for operational or regulatory purposes.
Excluded Cash Collateral. Notwithstanding any other provision to the contrary contained in this Agreement, it is understood and agreed that this Agreement shall not restrict the rights of the Original First Lien Agent or the other Original First Lien Secured Parties to pursue enforcement proceedings, exercise remedies or make determinations with respect to the Excluded Cash Collateral or otherwise take actions with respect to the Excluded Cash Collateral in accordance with the Original First Lien Credit Agreement and such Excluded Cash Collateral shall be applied as specified in the Original First Lien Credit Agreement and will not constitute Collateral hereunder. Nothing in this Agreement shall be construed to impair the right of any Original First Lien Secured Party to recoup, set off, net or off-set amounts (including amounts delivered as margin or cash collateral) to satisfy such Original First Lien Obligations secured by Excluded Cash Collateral to the extent permitted under the Original First Lien Credit Agreement, or exercise its rights and remedies with respect to any Excluded Cash Collateral pledged for its sole benefit or as a beneficiary under and pursuant to any other credit support issued solely in its favor, each of which will be governed by the terms of the Original First Lien Credit Agreement.
Excluded Cash Collateral. Notwithstanding any other provision to the contrary contained in this Agreement, it is understood and agreed that this Agreement shall not restrict the rights of any First-Priority Collateral Agent or any other First-Priority Secured Parties to pursue enforcement proceedings, exercise remedies or make determinations with respect to the Excluded Cash Collateral or otherwise take actions with respect to the Excluded Cash Collateral in accordance with the applicable First-Priority Documents and such Excluded Cash Collateral shall be applied as specified in the applicable First-Priority Document and will not constitute Common Collateral hereunder; provided, however, that if any Grantor shall fail to pay any of the First-Priority Obligations owing under the applicable First-Priority Document pursuant to which such Excluded Cash Collateral is provided as and when required thereunder, then the applicable First-Priority Secured Party agrees that to the extent it seeks to satisfy any such First-Priority Obligations owing to it, such First-Priority Secured Party shall first proceed to satisfy such First-Priority Obligations with the proceeds of Excluded Cash Collateral (or any letter of credit or other credit support issued or pledged in favor of such First-Priority Secured Party to support such First-Priority Obligations). If, following the application of any such Excluded Cash Collateral, letter of credit or other credit support to the repayment of such First-Priority Obligations owing to the applicable First-Priority Secured Party, such First-Priority Secured Party has not received the full amount of the First-Priority Obligations then due and owing to it, it shall be entitled to its pro rata share of any Common Collateral proceeds as otherwise contemplated by this Agreement. Nothing in this Agreement shall be construed to impair the right of any First-Priority Secured Party to recoup, set off, net or off-set amounts (including amounts delivered as margin or cash collateral) to satisfy such First-Priority Obligations secured by Excluded Cash Collateral to the extent permitted under the applicable First-Priority Document, or exercise its rights and remedies with respect to any Excluded Cash Collateral pledged for its sole benefit or as a beneficiary under and pursuant to any other credit support issued solely in its favor, each of which will be governed by the terms of such First-Priority Document.