Security given by a borrower to a lender in connection with a loan to insure that the lender is repaid. Lenders frequently accept collateral in tangible assets such as inventory, accounts receivable, real property, or buildings and less commonly take intangible assets such as patents or trademarks as collateral. In the event that the borrower cannot repay the loan when due, or for other reasons that may constitute an event of default, the lender, after complying with the loan agreement and applicable law, has the right to take possession of the Collateral, sell it, and apply the net proceeds (i.e., the cash received after payment of costs of sale) to the loan repayment.