Security Trusteeship is a contractual arrangement amongst Borrower, Lenders and Security Trustee materialized by executing a document called Security Trustee Agreement (STA) wherein the Borrower, settles a trust with the Security Trustee. Trust will hold Secured Properties (any kind of movables, immovables, pledge of shares, rights, etc.) and the Security Trustee will act as a Trustee to such Trust.
Nature of work
Advantages to Lenders:
- Vetting of documents before execution.
- Vetting of title search reports as a double check.
- Obtaining all corporate resolutions before execution.
- Ensure obtaining of permissions from Statutory / Regulatory / Existing Lenders / Lessor’s prior to creation of security.
- Compliance with registration of charges as specified under Companies Act,2013.
- Compliance with CERSAI rules.
- Safe custody of the documents in a professional environment, easily retrievable whenever required.
- Avoiding frequent transfer of title deeds from one Lender to another in case of down-selling.
- Hold pledge / NDU in our favour as per SAST guidelines for individual /several Lenders; thereby shares are encumbered only to one party. Act as per Lender/s instructions for release of security. Banks are not allowed to hold more than 30% equity stake in any company. However, we can hold 30% equity stake on their behalf. Appropriate disclosures in respect of listed shares are done in stock exchanges to effect the correct pledge position.
- Verify the letters from Lenders prior to modification/ satisfaction of loan.
- Execute re-conveyance deeds on satisfaction.
- Furnish confirmation letter on request from Lenders for Audit purposes.
- Undertake enforcement on the directions of Lenders.
- Mitigation of operational risk and release of resources for core business activities
Advantages to Borrowers:
- Single point of contact in consortium funding or multiple banking structures.
- Single charge created in favour of Trustee for the benefit of various Lenders. This helps in better stamp duty cost management.
- Facilitates Borrower at the time of modification/s and satisfaction of Charge.
Our Expertise
- A well-equipped team of experts comprising of Chartered Accountants, Lawyers, Company Secretaries and others possessing rich experience in Banking and Debt Markets, making us the best in the business.
- Timely drafting, vetting and execution of documents.
- Safe custody of title deeds.
- Expeditious implementation of modifications, enforcement directions.
Services Offered
- Structuring transactions as per sanction terms of Lender.
- Vetting of transaction documents.
- Conceptualizing, customizing and structuring of the security documents to consolidate documentation ensuring compliance with all the terms and conditions of the loan agreements of all lenders.
- Liaison with lenders and the Legal Counsel to expediate documentation.
- Create / hold security in favour of the Security Trustee on behalf of the lenders.
- Perfection of Security Interest created under
– Companies Act, 2013 – Registration of Charges
– CERSAI rules. - Safe custody of original title / transaction documents.
- Monitor the Asset Coverage.
- Maintain Records and submit various reports to the Lenders.
- Re-convey mortgaged properties on repayment.
- Monitor insurance policies.
- Security enforcement in case of default.
– Issue of Notice to Borrower
– Completion of Curation Period
– Obtaining requisite Approvals
– Completion of Court Procedure
– Obtaining Decree
None of the SEBI investor protection mechanisms shall be available for any grievances or disputes arising out of or pertaining to the activities which are not regulated by SEBI.