Value of additional security Clause Samples
The 'Value of additional security' clause defines how the worth of any extra security provided under an agreement is determined and treated. In practice, this clause specifies the method for valuing collateral or guarantees that exceed the initially required amount, such as additional cash deposits or property pledged by a party. Its core function is to ensure both parties have a clear understanding of how surplus security is assessed, which helps prevent disputes over the sufficiency or application of such security in the event of default or enforcement.
Value of additional security. The net realisable value of any additional security which is provided under Clause 15.1 and which consists of a Security Interest over a vessel shall be that shown by a valuation complying with the requirements of Clause 15.4.
Value of additional security. The market value of any additional security which is provided under Clause 15.1 shall be as follows:
(a) if it consists of a Security Interest over a vessel, shall be that shown by a valuation complying with the requirements of Clause 15.2 Provided that if such vessel is, on the date of its valuation, subject to an Assignable Charter with an unexpired duration exceeding or, capable of exceeding (through the exercise by its owner of any extension option exercisable by it), 18 months, in respect of which an Assignable Charter Assignment has been executed, the valuation shall be adjusted to take account of that charter;
(b) if it consists of a Security Interest over a Dollar cash deposit, shall be that of the amount standing to the credit of the relevant account at that time (without taking into consideration, for the avoidance of doubt, cash standing to the credit of the Earnings Account) on a “Dollar for Dollar” basis; and
(c) if it consists of a Security Interest over any other asset, shall be that reasonably determined by the Agent.
Value of additional security. The net realisable value of any additional security which is provided under Clause 25.4 (Provision of additional security; prepayment) and which consists of first preferred Security over a drillship shall be the Market Value of the drillship concerned.
Value of additional security. The market value of any additional security which is provided under Clause 15.2 shall be as follows:
(a) if it consists of a Security Interest over a vessel, shall be that shown by a valuation complying with the requirements of Clause 15.3 but if such vessel is, on the date of its valuation, subject to a charter having an unexpired duration of at least 12 months with a charterer acceptable to the Agent, the valuation shall be adjusted to take account of that charter;
(b) if it consists of a Security Interest over a Dollar cash deposit, shall be that of the amount standing to the credit of the relevant account at that time on a “Dollar for Dollar” basis; and
(c) if it consists of a Security Interest over any other asset, shall be that reasonably determined by the Agent.
Value of additional security. The net realisable value of any additional security which is provided under Clause 15.6 (Prepayment; provision of additional security) and which consists of:
(a) a first preferred or first priority mortgage over a vessel, shall be the Market Value of the vessel concerned;
(b) Security over a cash deposit held in an account pledged in favour of the Lenders, shall be the amount standing to the credit of such account at that time (without taking into account, for the avoidance of doubt, cash standing to the credit of the Earnings Accounts) on a one Dollar to one Dollar basis; and
(c) Security over any other asset, shall be that determined by and acceptable to the Facility Agent, acting on the instructions of all the Lenders.