1. Declaration of Trust
1.1. The Security Trustee will hold all assets charged under the Security Documents on trust for the Lender Members for the purpose of securing the Secured Obligations (as defined in the Security Documents).
2. Security Trustee’s Actions
2.1. The Security Trustee will act in a fair and equitable manner to achieve maximum recovery for all affected Lending Members in the loan, which may include restructuring or extending payment terms or selling the debt to a third party.
2.2. The Security Trustee shall be entitled, in its absolute discretion, to refrain from taking any (or any further) action or exercising any of the Security Trustee’s rights under or in respect of these terms or any Security Document and any action taken by it will be based on the information available to it at that time including, but not limited to, the value of the assets, the costs of enforcement. There may be circumstances where the realisable value of the assets of a company are out-weighed by the costs of recovering the assets. In these circumstances, the Security Trustee is not obliged nor should Lending Members expect, the Security Trustee to incur costs that it cannot reasonably recover.
3. Security Trustee’s Rights and Discretions
3.1. The Security Trustee may:
(a) obtain and pay for such legal or other expert advice or services as it may consider necessary or desirable;
(b) retain for its own benefit, without liability to account to any other person, any fee or other sum received by it for its own account;
(c) exercise any of its rights, powers and discretions and perform any of its obligations under these terms or any of the Security Documents through its employees or through paid or unpaid agents, which may be corporations, partnerships or individuals (whether or not lawyers or other professional persons), and shall not be responsible for any misconduct or omission on the part of, or be bound to supervise the proceedings or acts of, any such employee or agent (and any such agent which is engaged in any profession or business shall be entitled to charge and be paid all usual fees, expenses and other charges for its services);
(d) at any time and from time to time delegate, whether by power of attorney or otherwise and upon such terms and conditions (including the power to sub-delegate with the consent of the Security Trustee) as the Security Trustee may think fit, to any persons all or any of its rights, powers and discretions under these terms or under any of the Security Documents, and shall not be in any way liable or responsible to any person for any loss or damage arising from any act, default, omission or misconduct on the part of any such delegate or sub-delegate;
(e) together with every Receiver, Delegate or other person appointed under these terms or any of the Security Documents, indemnify itself out of the Secured Assets against all proceedings, claims and demands which may be made or taken against it and all costs, charges, damages, expenses and liabilities which it may suffer or incur unless suffered or incurred by reason of its own gross negligence or willful misconduct; and
(f) unless it has, in its capacity as trustee for the Lender Members, received actual notice to the contrary, assume that (i) no Event of Default has occurred and no borrower is in breach of or default under its obligations under any of the Overarching Loan Agreements and (ii) any right, power, authority or discretion vested by any Overarching Loan Agreement in any person has not been exercised.
4. Application of Proceeds
4.1. The Security Agent shall (after allowing for remuneration as per clause 5.2 below, costs of recovery and sale) hold and manage the net realised funds or the asset and shall at its discretion transfer such funds to Ablrate to be distributed to the relevant Lending Member in the loan (pro rata) in repayment of the underlying asset finance loan or loans
5. Powers and Remuneration
5.1. The Security Trustee shall have such rights, powers, authorities and discretions as are (i) conferred on trustees by the Trustee Acts and (ii) by way of supplement to the Trustee Acts as provided for in these terms and the Security Documents.
5.2. The Security Trustee shall be entitled to such remuneration as it may from time to time agree with Lender Agents.
6. Responsibility of Lender Members
6.1. It is understood and agreed by each Lender Member that at all times that Lender Member has itself been, and will continue to be, solely responsible for making its own independent appraisal of and investigation into all risks arising under or in connection with the Security Documents including but not limited to:
6.2. the financial condition, creditworthiness, condition, affairs, status and nature of each of the borrowers;
6.3. the legality, validity, effectiveness, adequacy and enforceability of each of the Overarching Loan Agreements, Security Documents and any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection with the same;
6.4. whether that Lender Member has recourse, and the nature and extent of that recourse, against any borrower or any other person or any of their respective assets under or in connection with the overarching Loan Agreements and Security Documents or the transactions contemplated therein or any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection with the same;
6.5. the adequacy, accuracy and/or completeness of any information provided by any person in connection with the overarching Loan Agreements and Security Documents or the transactions contemplated therein or any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection with the same; and
6.6. the right or title of any person in or to, or the value or sufficiency of any part of the Secured Assets, the priority of any of the Security or the existence of any other encumbrance affecting the Secured Assets, and each Lender Member warrants to the Security Trustee that it has not relied on and will not at any time rely on the Security Trustee in respect of any of these matters.
7. No Responsibility to Perfect Security
The Security Trustee shall not be liable for any omission or defect in, or any failure to preserve or perfect any or all of the Security Documents including, without limitation, any failure to:
7.1. require the deposit with it of any deed or document certifying, representing or constituting the title to the Secured Assets;
7.2. obtain any licence, consent or other authority for the execution, delivery, legality, validity, enforceability or admissibility in evidence of any of the Security Documents;
7.3. register, file or record or otherwise protect any of the Security (or the priority of any of the Security) under any applicable laws in any jurisdiction or to give notice to any person of the execution of any of the Security Documents;
7.4. take, or to require any of the chargors to take, any steps to perfect its title to any of the Charged Assets or to render the Security effective or to secure the creation of any ancillary security under the laws of any jurisdiction; or
7.5. require any further assurances in relation to any of the Security.
The Security Trustee shall not be under any obligation to insure any of the Charged Assets, to require any other person to maintain any insurance or to verify any obligation to arrange or maintain insurance contained in the Security Documents. The Security Trustee shall not be responsible for any loss which may be suffered by any person as a result of the lack of or inadequacy of any such insurance. Where the Security Trustee is named on any insurance policy as an insured party, it shall not be responsible for any loss which may be suffered by reason of, directly or indirectly, its failure to notify the insurers of any material fact relating to the risk assumed by such insurers or any other information of any kind.
9. Acceptance of Title
The Security Trustee shall be entitled to accept without enquiry, and shall not be obliged to investigate, such evidence of right and title as any chargors may have to any of the Charged Assets and shall not be liable for or bound to require any chargor to remedy any defect in its right or title.
10. Refrain from Illegality
The Security Trustee may refrain from doing anything which in its opinion would or might be contrary to any law of any jurisdiction or any directive or regulation binding on it which would or might otherwise render it liable to any person, and the Security Trustee may do anything which is, in its opinion, necessary to comply with any such law, directive or regulation.
11. Exclusion of Liability
Neither the Security Trustee nor any of its officers, employees or agents makes, or shall at any time be deemed to have made any representation or warranty (express or implied) with regard to, nor shall it be responsible or liable to any person for:
11.1. the adequacy, accuracy or completeness of any representation, warranty, statement or information contained in these terms or any Security Document, notice, report or other document, statement or information circulated, delivered or made to any Lender Member whether orally or otherwise and whether before, on or after the date of these terms;
11.2. the execution, delivery, validity, legality, priority, ranking, adequacy, effectiveness, performance, enforceability or admissibility in evidence of these terms or any Security Document or any other document referred to in paragraph 11.1 above or of any Security created thereby or any obligations imposed thereby or assumed thereunder or any other document, agreement or arrangement entered into, made or executed in anticipation of, pursuant to or in connection therewith;
11.3. anything done or not done by it or any of them under or in connection with these terms or any Security Document;
11.4. any losses to any person or any liability arising as a result of taking or refraining from taking any action in relation to any of the Security Documents or otherwise;
11.5. the exercise of, or the failure to exercise, any judgment, discretion or power given to it by or in connection with any of the Security Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, pursuant to or in connection therewith; or
11.6. any shortfall which arises on the enforcement of the Security Documents;
and each of the Lender Members agrees that it will not take any proceedings or assert or seek to assert against any officer, employee or agent of the Security Trustee any claim it might have against any of them in respect of the matters referred to in this Clause 11 .