Common use of Financial Collateral Clause in Contracts

Financial Collateral. (a) To the extent that the assets mortgaged or charged under this Security Agreement constitute “financial collateral” and this Security Agreement and the obligations of a Chargor under this Security Agreement constitute a “security financial collateral arrangement” (in each case for the purpose of and as defined in the Financial Collateral Arrangements (No. 2) Regulations 2003 (SI 2003 No. 3226)) the Collateral Agent will have the right after this Security has become enforceable to appropriate all or any part of that financial collateral in or towards the satisfaction of the Secured Liabilities. (b) Where any financial collateral is appropriated: (i) if the financial collateral is listed or traded on a recognised exchange its value will be taken as the value at which it could have been sold on the exchange on the date of appropriation; or (ii) in any other case, the value of the financial collateral will be such amount as the Collateral Agent reasonably determines, acting in good faith and in consultation with the relevant Chargor, having taken into account advice obtained by it from an independent investment or accountancy firm of national standing selected by it; and each Secured Party will give credit for the proportion of the value of the financial collateral appropriated to its use.