Master Security Agreement for the United Kingdom

Master Security Agreement Template for England and Wales

A Master Security Agreement is a comprehensive legal document governed by English and Welsh law that establishes a framework for creating and managing multiple security interests over various assets. It sets out the terms under which security is granted, maintained, and enforced, typically used in complex financing arrangements where multiple assets or obligations need to be secured. The agreement includes detailed provisions for the creation, perfection, and enforcement of security interests, along with representations, warranties, and covenants of the security provider.

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What is a Master Security Agreement?

The Master Security Agreement serves as the primary security document in complex financing arrangements under English and Welsh law. It is typically used when multiple assets need to be secured or when security needs to be granted over time for different obligations. The agreement provides a uniform set of terms and conditions that apply to all security interests created under it, reducing documentation requirements and ensuring consistency. It includes provisions for creation, perfection, and enforcement of security, along with detailed representations and covenants, making it particularly useful in syndicated lending, project finance, and structured finance transactions.

What sections should be included in a Master Security Agreement?

1. Parties: Identifies the security provider and security trustee/beneficiary

2. Background: Context of the security arrangement and underlying obligations

3. Definitions: Key terms used throughout the agreement including secured assets and secured liabilities

4. Creation of Security: Core provisions creating the security interests over different asset classes

5. Representations and Warranties: Standard security provider representations regarding ownership, capacity, and authority

6. Covenants: Ongoing obligations of the security provider including maintenance of assets and restrictions

7. Further Assurance: Obligations to execute additional documents and perfect security

8. Enforcement: Rights and remedies upon default including appointment of receivers

9. Power of Attorney: Appointment of security trustee as attorney for security purposes

10. Miscellaneous: Standard boilerplate provisions including notices and amendments

What sections are optional to include in a Master Security Agreement?

1. Intercreditor Provisions: Provisions governing relationships between multiple creditors, used when there are multiple secured parties

2. Trust Provisions: Detailed trust arrangements when security is held by a security trustee for multiple beneficiaries

3. Foreign Law Security: Additional provisions for security over overseas assets or involving foreign security providers

4. Bank Accounts: Specific provisions for charged bank accounts and operation restrictions

5. Insurance Provisions: Detailed requirements for insurance of secured assets and application of proceeds

What schedules should be included in a Master Security Agreement?

1. Schedule 1 - Secured Assets: Detailed description and categorization of all assets subject to security

2. Schedule 2 - Secured Liabilities: Definition and scope of obligations secured by the agreement

3. Schedule 3 - Forms of Notice: Standard form notices for perfecting security over various assets including account bank notices

4. Schedule 4 - Security Documents: List of supplemental security documents forming part of the security package

5. Schedule 5 - Powers of Receiver: Detailed list of powers granted to any appointed receiver

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

England and Wales

Publisher

Genie AI

Document Type

Security Agreement

Cost

Free to use
Relevant legal definitions
Clauses
Industries

Financial Collateral Arrangements (No.2) Regulations 2003: Key legislation governing financial collateral arrangements in England and Wales, implementing the EU Financial Collateral Directive. Covers requirements for security over cash, financial instruments, and credit claims.

Law of Property Act 1925: Fundamental legislation governing real property and security interests in England and Wales, including mortgages and charges over property.

Companies Act 2006: Principal legislation governing company law in the UK, including requirements for registration of company charges and corporate security arrangements.

Insolvency Act 1986: Legislation governing insolvency proceedings and the treatment of security interests in insolvency scenarios, including provisions affecting the enforcement of security.

Enterprise Act 2002: Legislation that modified corporate insolvency regime and enforcement of security, particularly affecting administrative receivership and administration procedures.

Financial Services and Markets Act 2000: Primary legislation for financial services regulation in the UK, including provisions affecting security arrangements involving regulated entities.

Companies (Registration of Charges) Regulations 2009: Detailed regulations governing the registration of security interests at Companies House, including filing requirements and deadlines.

EU Financial Collateral Directive: European directive (principles retained post-Brexit) establishing framework for financial collateral arrangements across European jurisdictions.

Consumer Credit Act 1974: Legislation governing consumer credit and security arrangements involving consumers, including specific protections and requirements.

Teams

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