Common use of Replacement Collateral Clause in Contracts

Replacement Collateral. Subject to obtaining the consents of any necessary prior secured parties, the Debtor, with the consent of the Secured Party, may replace any items of the Collateral, provided that such replacement is of equal or greater value to the item(s) so replaced, that the same are fully paid for, or that such purchase be secured by a security agreement under the Uniform Commercial Code, which security agreement shall be subordinate to this Agreement, and further, provided that within five (5) days of any such replacement, a supplemental security agreement covering such new chattel, fixtures and equipment which shall be executed and delivered by the Debtor to the Secured Party c/o its attorney, together with an appropriate resolution of the Board of Directors of the Debtor, by certified mail, return receipt requested. The new chattels, fixtures and equipment shall be deemed additional items of collateral hereunder and shall be of equal or better quality than the replaced items of collateral, and shall be deemed to be included in the term "Collateral". 2.1 Debtor represents, warrants, covenants and agrees as follows:

Replacement Collateral. Subject to obtaining the consents of any necessary prior secured parties, the Debtor, with the consent of the Secured PartyParry, may replace any items of the Collateral, provided that such replacement is of equal or greater value to the item(s) so replaced, that the same are fully paid for, or that such purchase be secured by a security agreement under the Uniform Commercial Code, which security agreement shall be subordinate to this Agreement, and further, provided that within five (5) days of any such replacement, a supplemental security agreement covering such new chattel, fixtures and equipment which shall be executed and delivered by the Debtor to the Secured Party c/o its attorney, together with an appropriate resolution of the Board of Directors of the Debtor, by certified mail, return receipt requested. The new chattels, fixtures and equipment shall be deemed additional items of collateral hereunder and shall be of equal or better quality than the replaced items of collateral, and shall be deemed to be included in the term "Collateral". 2.1 Debtor represents, warrants, covenants and agrees as follows: