{"component": "clause", "props": {"groups": [{"samples": [{"hash": "eilLUgkbg77", "uri": "/contracts/eilLUgkbg77#first-priority-security-interest", "label": "Renewable Power Purchase and Sale Agreement (Montauk Renewables, Inc.)", "score": 31.9979457855, "published": true}, {"hash": "677a7UMXZhF", "uri": "/contracts/677a7UMXZhF#first-priority-security-interest", "label": "Renewable Power Purchase and Sale Agreement", "score": 25.3496761322, "published": true}, {"hash": "9TU7ATYOpMU", "uri": "/contracts/9TU7ATYOpMU#first-priority-security-interest", "label": "Renewable Power Purchase and Sale Agreement", "score": 25.1772232056, "published": true}], "snippet": "To secure its obligations under this Agreement, and until released as provided herein, Seller hereby grants to Anaheim a present and continuing first-priority security interest (\u201cSecurity Interest\u201d) in, and lien on (and right to net against), and assignment of the Development Security and Performance Assurance posted pursuant to Sections 3.06 and 8.02, and all interest thereon or proceeds resulting therefrom or from the liquidation thereof, whether now or hereafter held by, on behalf of, or for the benefit of Anaheim, and Seller agrees to take all action as Anaheim reasonably requires in order to perfect Anaheim\u2019s Security Interest in, and lien on (and right to net against), such collateral and any and all proceeds resulting therefrom or from the liquidation thereof. Upon or any time after the occurrence of, and during the continuation of, an Event of Default caused by Seller, an Early Termination Date resulting from an Event of Default caused by Seller, or an occasion provided for in this Agreement where Anaheim is authorized to retain all or a portion of the Development Security or Performance Assurance, Anaheim may do any one or more of the following:\n(a) Exercise any of its rights and remedies with respect to the Development Security and Performance Assurance, including any such rights and remedies under Applicable Laws then in effect;\n(b) Draw on any outstanding Letter of Credit issued for its benefit; and\n(c) Liquidate all Development Security and Performance Assurance then held by or for the benefit of Anaheim free from any claim or right of any nature whatsoever of Seller, including any equity or right of purchase or redemption by Seller. Anaheim shall apply the proceeds of the collateral realized upon the exercise of any such rights or remedies to reduce Seller\u2019s obligations under this Agreement, subject to Anaheim\u2019s obligation to return any surplus proceeds remaining after these obligations are satisfied in full. Notwithstanding the foregoing, Seller remains liable for any amounts owing to Anaheim after such application.", "snippet_links": [{"key": "to-secure", "type": "clause", "offset": [0, 9]}, {"key": "obligations-under-this-agreement", "type": "clause", "offset": [14, 46]}, {"key": "priority-security-interest", "type": "definition", "offset": [150, 176]}, {"key": "right-to", "type": "definition", "offset": [220, 228]}, {"key": "development-security-and-performance-assurance", "type": "clause", "offset": [265, 311]}, {"key": "pursuant-to-sections", "type": "clause", "offset": [319, 339]}, {"key": "on-behalf-of", "type": "definition", "offset": [479, 491]}, {"key": "for-the-benefit-of", "type": "definition", "offset": [496, 514]}, {"key": "agrees-to", "type": "clause", "offset": [535, 544]}, {"key": "in-order-to", "type": "clause", "offset": [592, 603]}, {"key": "any-time", "type": "definition", "offset": [786, 794]}, {"key": "continuation-of", "type": "clause", "offset": [835, 850]}, 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Upon the filing of a Financing Statement in the appropriate Filing Office for the location of the Debtor listed in the Debtor's Perfection Certificate, the Security Interest will be perfected (except to the extent a security interest may not be perfected by filing under the Uniform Commercial Code), prior to all other Encumbrances, and will be enforceable as such against creditors of the Debtor, any owner of the real property where any of the Collateral is located, any purchaser of such real property and any present or future creditor obtaining a lien on such real property.", "snippet_links": [{"key": "this-agreement", "type": "clause", "offset": [0, 14]}, {"key": "continuing-lien", "type": "clause", "offset": [35, 50]}, {"key": "security-interest-in-the-collateral", "type": "clause", "offset": [58, 93]}, {"key": "financing-statement", "type": "definition", "offset": [116, 135]}, {"key": "filing-office", "type": "definition", "offset": [155, 168]}, {"key": "location-of-the-debtor", 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All of filings and other actions necessary to perfect and protect such pledges, assignments and security interests have been duly made or taken and are in full force and effect or will be duly made or taken in accordance with the terms of the Note Documents; and all filing and recording fees and taxes related to any of the foregoing have been duly paid.", "snippet_links": [{"key": "this-agreement", "type": "clause", "offset": [0, 14]}, {"key": "the-pledge", "type": "clause", "offset": [20, 30]}, {"key": "assignment-and", "type": "clause", "offset": [32, 46]}, {"key": "perfected-first-priority-lien", "type": "clause", "offset": [115, 144]}, {"key": "security-interest-in-the-collateral", "type": "clause", "offset": [152, 187]}, {"key": "in-favor-of", "type": "clause", "offset": [188, 199]}, {"key": "the-collateral-agent", "type": "definition", "offset": [200, 220]}, {"key": "for-the-benefit-of", "type": "definition", "offset": [222, 240]}, {"key": "other-secured-parties", "type": "definition", "offset": [256, 277]}, {"key": "payment-of-the-secured-obligations", "type": "clause", "offset": [292, 326]}, {"key": "other-actions-necessary", "type": "clause", "offset": [347, 370]}, {"key": "assignments-and", "type": "definition", "offset": [408, 423]}, {"key": "security-interests", "type": "definition", "offset": [424, 442]}, {"key": "duly-made", "type": "definition", "offset": [453, 462]}, {"key": "full-force-and-effect", "type": "clause", "offset": [483, 504]}, {"key": "in-accordance-with", "type": "clause", "offset": [535, 553]}, {"key": "note-documents", "type": "clause", "offset": [571, 585]}, {"key": "fees-and-taxes", "type": "clause", "offset": [616, 630]}, {"key": "related-to", "type": "clause", "offset": [631, 641]}, {"key": "the-foregoing", "type": "clause", "offset": [649, 662]}], "size": 4, "hash": "73d0edabb3201b3db1a15e8163228350", "id": 10}], "next_curs": "CmkSY2oVc35sYXdpbnNpZGVyY29udHJhY3RzckULEhZDbGF1c2VTbmlwcGV0R3JvdXBfdjU2IilmaXJzdC1wcmlvcml0eS1zZWN1cml0eS1pbnRlcmVzdCMwMDAwMDAwYQyiAQJlbhgAIAA=", "clause": {"parents": [["representations-and-warranties", "REPRESENTATIONS AND WARRANTIES"], ["therefore", "Therefore"], ["miscellaneous", "Miscellaneous"], ["now-therefore", "NOW, THEREFORE"], ["representations-warranties-and-covenants", "Representations, Warranties and Covenants"]], "children": [["records-and-information", "Records and Information"], ["sale-disposition-or-encumbrance-of-collateral", "Sale, Disposition or Encumbrance of Collateral"], ["dividends-or-distributions", "Dividends or Distributions"], ["voting-and-other-consensual-rights", "Voting and Other Consensual Rights"], ["disclaimer-of-certain-duties", "Disclaimer of Certain Duties"]], "size": 173, "title": "First Priority Security Interest", "id": "first-priority-security-interest", "related": [["perfected-first-priority-liens", "Perfected First Priority Liens", "Perfected First Priority Liens"], ["security-interest", "Security Interest", "Security Interest"], ["security-interest-priority", "Security Interest/Priority", "Security Interest/Priority"], ["valid-security-interest", "Valid Security Interest", "Valid Security Interest"], ["perfected-security-interest", "Perfected Security Interest", "Perfected Security Interest"]], "related_snippets": [], "updated": "2025-08-09T06:18:11+00:00", "also_ask": ["What key elements must be included to ensure the security interest is truly first priority?", "How can subordination risks or hidden liens be identified and mitigated during negotiation?", "What are the most common drafting errors that could jeopardize enforceability in court?", "How does this clause compare to similar provisions under UCC Article 9 or other relevant jurisdictions?", "What evidence is typically required to prove first priority status in a dispute or insolvency proceeding?"], "drafting_tip": "Define 'First Priority Security Interest' precisely to avoid ambiguity; specify collateral covered to ensure enforceability; require subordination of conflicting interests to protect lender's rights.", "explanation": "A First Priority Security Interest clause establishes that a lender or secured party has the highest-ranking claim over specified collateral in the event of a debtor's default. This means that if the borrower fails to meet their obligations, the holder of the first priority security interest is entitled to be paid from the proceeds of the collateral before any other creditors with lower-ranking interests. For example, in a loan agreement secured by company assets, this clause ensures the lender's claim takes precedence over subsequent lenders or unsecured creditors. The core function of this clause is to protect the secured party's position and reduce their risk by guaranteeing their right to repayment from the collateral ahead of others."}, "json": true, "cursor": ""}}