Facility Agreement: secured
Facility agreement for a secured loan facility to a corporate borrower which is incorporated in England and Wales, to be available to be drawn during an availability period and repayable on a fixed repayment date.
Read more
When do I use this document?
- for a secured loan facility to be available for drawing during an availability period
- for a borrower which is a company incorporated in England and Wales
What are the key features?
- 23 clauses and two schedules over 15 pages
- mechanism for the borrower to request advances, subject to satisfaction of conditions precedent
- regular interest payments at either fixed or floating interest rate by reference to specified bank’s base rate of interest
- repayment of all loans on a fixed repayment date, with borrower able to prepay in whole or in part
- provision for an arrangement fee and facility commitment fee
- undertakings from the borrower, including to provide information to the lender and prohibition on granting security and additional borrowings
- events of default, leading to the lender having the right to stop further advances and demand immediate repayment
What else do I need to know?
The security would need to be created and governed by a separate security document between the borrower and the lender, depending on the nature of the secured property or assets. Examples of security documents include:
- a charge over property
- a charge over shares
- a debenture, containing fixed and floating charges over all of the borrower’s assets and undertaking
What other documents are available?
For a form of unsecured facility agreement, see
For forms of unsecured and secured loan agreements, see
When do I use this document?
- as a document to be delivered by a seller at closing of a Share Purchase Agreement
- when stamp duty is payable on the share transfer
- to enable the buyer to vote and exercise other share rights pending the registration of the share transfer
What are the key features?
-
- suitable for an individual or corporate seller
- appointment of the buyer as the seller’s attorney
- grant of authority to the buyer to exercise all rights as the legal owner of the sale shares
- irrevocable appointment given by way of security
What else do I need to know?
Following the closing of a share sale transaction, the seller will remain the registered owner of the shares which have been sold until the buyer has paid the necessary stamp duty. This process can take a number of weeks. The transfer of the sale shares cannot be registered in the register of members of the target company until the stamp duty has been paid.
The buyer will want to be able to exercise all the rights as the owner of the sale shares notwithstanding that the seller remains the registered legal owner of the sale shares. To enable the buyer to do this, the buyer will usually require that the seller grants a power of attorney in favour of the buyer which enables the buyer to exercise the legal rights of ownership of the sale shares.
If a share transfer involves consideration exceeding £1,000, stamp duty will be payable to HMRC and HMRC will need to confirm that the stamp duty has been paid. This stamping process typically takes a few weeks and involves payment of the stamp duty and submission of the stock transfer by email to HMRC for HMRC to confirm the payment.
Related Articles
Sorry, we couldn't find any posts. Please try a different search.
£50.00 exc VAT
Updated by a lawyer on 03/09/2024
- Updated By a lawyer on
- Guidance notes included
- No hidden extras
- Easily customisable
Create your document in 3 Easy Steps
- Download
- Customise
- Share & Sign
PaperRock offers affordable, legal document templates, written by experienced and expert lawyers, trusted by businesses across the UK and beyond. No hidden charges or trial sign-ups are required to complete your document.
“I have worked in legal and business affairs for over 25 years and need access to a wide range of corporate and commercial legal precedents. Paperrock is a refreshing source of high-quality legal templates. Superb value for money.”
Amanda | Bannister Creative
£50.00 exc VAT
- Written by expert lawyers
- Quick to download
- Easy to customise
- No hidden extras
- free re-downloads
“It’s hard to find legal documents on the internet you can really trust. Knowing an expert lawyer has drafted what I need, gives my business the edge and gives me peace of mind.”
Elle, Founder | Winslow skincare & aesthetics.
“As an SME Paperrock saves us the legal fees we’ve previously had to spend. In these challenging times that's a big help. Great products and support.”
Giles, MD | Boniti Ltd.
