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Template:M intro repack covenant to pay: Difference between revisions
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Revision as of 11:09, 3 October 2023
, 3 October 2023→Why have separate covenants to the Trustee, if they are direct covenants under the Notes?
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The security trustee holds the covenant on trust for noteholders, other secured parties (and itself to the extent of its own fees) to defend against trustee running off with the money: under the trust noteholders can trace their claims in the trustee’s hands if the trustee does a bolter. | The security trustee holds the covenant on trust for noteholders, other secured parties (and itself to the extent of its own fees) to defend against trustee running off with the money: under the trust noteholders can trace their claims in the trustee’s hands if the trustee does a bolter. | ||
==== | ====Separate covenants to the Trustee?==== | ||
====Privity ==== | ====Privity ==== | ||
As described above. it establishes a direct contractual relationship between the Issuer/chargor and Trustee for the main indebtedness, which there would otherwise not be (albeit that the Trustee holds this obligation on trust for the Secured Parties) | As described above. it establishes a direct contractual relationship between the Issuer/chargor and Trustee for the main indebtedness, which there would otherwise not be (albeit that the Trustee holds this obligation on trust for the Secured Parties) | ||