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Liability: Difference between revisions
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===Payment of liabilities out of own funds=== | ===Payment of liabilities out of own funds=== | ||
You may occasionally see a covenant from an [[repackaging]] [[espievie]] to its [[security trustee]] as follows: | You may occasionally see a covenant from an [[repackaging]] [[espievie]] to its [[security trustee]] as follows: | ||
{{quote|'''[[Payment of | {{quote|'''[[Payment of liabilities]]''': The issuer must, [[at all times]], pay its liabilities out of its own funds or [[Procure|procure]] payment of such liabilities by other persons out of moneys owing to it.}} | ||
This seems to be as close to canonical as anything on Planet Repack, but it hardly stands up to close scrutiny. What does it even mean? Is it a simply covenant to its trustee perform its contractual obligations to others? On what planet would | This seems to be as close to canonical as anything on Planet Repack, but it hardly stands up to close scrutiny. What does it even mean? Is it a simply covenant to its trustee perform its contractual obligations to others? {{security trustees as vogons}} | ||
On what planet would one be animated enough to take upon itself the job of enforcing some one else’s entitlement, if the someone else in question was not inclined to do so herself? And for what? Or is it meant to ''constrain'' how the issuer discharges its liabilities to others; to proscribe the manner in which it discharges its debts? In which case, how else could it meet its liabilities other than from funds it holds or which are owed to it, without committing aggravated robbery? | |||
{{sa}} | {{sa}} | ||
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*[[Borrowed money]] | *[[Borrowed money]] | ||
{{ref}} | {{ref}} | ||
{{c|Repackaging}} | |||