Property of an entity that is subject to a security interest or lien securing payment or performance of an obligation in favor of a secured party. If the entity breaches its obligations to the secured party, the secured party will have rights and remedies with respect to the collateral, including liquidation and foreclosure.

For more information on taking security interests in collateral, see Practice Notes, UCC Creation, Perfection, and Priority of Security Interests and Security: Overview.

For information on negotiating counterparty collateral arrangements in the context of swaps and derivatives, prime brokerage and other transactions, see Checklist, The ISDA® Master Agreement: Credit Support Annex (CSA) Paragraph 13 Negotiation Checklist.