Question

Terminal warehouse agreements:

A. remove control of the inventory from the borrower.

B. give the lender a lien against all inventories while only removing representative items.

C. are particularly useful where large bulky items are used as collateral.

D. are less costly than field warehouse agreements.

Answer 1

Answer: C

It is useful in case of heavy items and as collateral purpose. Such agreement is for transportation of collateral goods to public warehouse. This is the physical movement of goods from borrower’s warehouse.