Creating a Security Agreement

The Security Agreement (SA) is the most important document to complete when filing a UCC-1 Financing Statement. It is a private agreement which specifies that the Debtor must perform as the transmitting utility for the Secured Party in commerce, in exchange for the secured party providing assets and collateral to the debtor. This would be called equal consideration. This agreement may also specify a sum of, typically, $100,000,000+ dollars as the security interest from the Debtor to the Secured Party. The security interest amount doesn’t have to be 100 million dollars, it's better to make it more than less. Either way, it should be a high enough number to ensure that the Secured Party will always have the paramount claim of interest over all assets and property of the Debtor/tradename.

In a secured financing transaction, the security agreement fulfils two main purposes, namely:

  1. Satisfying certain requirements of the UCC for the creation and attachment of a security interest and provides for certain rights and remedies of the Creditor under the UCC.

  2. Reflecting the deal between the Creditor and the Debtor concerning the collateral. The security agreement balances the Creditor's need to create and preserve its perfected security interest in the collateral and the Debtor's need to use its assets and operate its business without interference.

Like with any other document, there is no one-and-only-way of writing a Security Agreement. Your document can be very long and detailed, or perhaps short and vague, and vice-versa. To aid you in your journey, please find several Templates for a Security Agreement below. It is good practice to read through the entire document and change the content to tailor to your situation. Perhaps you will find one section resonates from one template, and another section resonates from a different template.


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  • SPC Security Agreement - .docx


Write your own using parts from Other's examples:


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  • Collateral - Property that is pledged as security against a debt; the property subject to a security interest or agricultural lien. See UCC § 9-102(a)(12) - Also termed collateral security.

  • Security - An instrument that evidences the holder's ownership rights in a firm (e.g., a stock), the holder's creditor relationship with a firm or government (e.g., a bond), or the holder's other rights (e.g., an option). • A security indicates an interest based on an investment in a common enterprise rather than direct participation in the enterprise. Under an important statutory definition, a security is any interest or instrument relating finances, including a note, stock, treasury stock, bond, debenture, evidence of indebtedness, certificate of interest or participation in a profit-sharing agreement, collateral trust certificate, preorganization certificate or subscription, transferrable, share, investment contract, voting trust certificate, certificate of deposit for a security, fractional undivided interest in oil, gas, or other mineral rights, or certificate of interest or participation in, temporary or interim certificate for, receipt for, guarantee of, or warrant or right to subscribe to or purchase any of these things. A security also includes any put, call, deposit, group or index of securities, or any such device entered into on a national securities exchange, relating to foreign currency.