Third Party Collateral Agreement for Malta

Third Party Collateral Agreement Template for Malta

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Third Party Collateral Agreement

"I need a Third Party Collateral Agreement governed by Maltese law where a parent company will provide listed securities as collateral for a €5M loan facility being granted to its subsidiary by MaltaBank plc, with the security to become effective by March 2025."

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What is a Third Party Collateral Agreement?

The Third Party Collateral Agreement is a crucial document in secured financing transactions under Maltese law, used when a party other than the primary obligor provides collateral to secure financial obligations. This arrangement is common in corporate group structures, family businesses, or where strategic business partners provide cross-support. The agreement must comply with Malta's implementation of EU financial collateral regulations and local security interest laws. It typically includes detailed provisions on the nature and extent of the security interest, collateral maintenance requirements, enforcement mechanisms, and the rights and obligations of all parties. The document is particularly important in Malta's financial services sector and must address specific local law requirements regarding creation, perfection, and enforcement of security interests.

What sections should be included in a Third Party Collateral Agreement?

1. Parties: Identification of the secured party, primary obligor, and third-party collateral provider

2. Background: Context of the agreement, relationship between parties, and purpose of the collateral arrangement

3. Definitions and Interpretation: Definitions of key terms and interpretation rules

4. Secured Obligations: Description and scope of the obligations being secured

5. Grant of Security Interest: Creation and terms of the security interest over the collateral

6. Nature of Security: Specification of the type of security interest being created

7. Representations and Warranties: Statements by the collateral provider regarding ownership, authority, and absence of encumbrances

8. Covenants: Ongoing obligations of the collateral provider regarding the collateral

9. Rights and Obligations: Detailed rights and obligations of all parties regarding the collateral

10. Enforcement: Circumstances and procedures for enforcing the security interest

11. Power of Attorney: Appointment of the secured party as attorney for enforcement purposes

12. Further Assurance: Obligation to execute additional documents if needed

13. Miscellaneous: Standard boilerplate provisions

14. Governing Law and Jurisdiction: Confirmation of Maltese law application and jurisdiction

What sections are optional to include in a Third Party Collateral Agreement?

1. Control Agreement Provisions: Required when collateral includes bank accounts or investment accounts requiring control agreements

2. Custodian Provisions: Required when collateral is held by a third-party custodian

3. Income and Voting Rights: Required for financial instruments with voting rights or income streams

4. Currency Provisions: Required when collateral or secured obligations involve multiple currencies

5. Insurance Requirements: Required when collateral includes physical assets requiring insurance

6. Registration Requirements: Required when security interest must be registered with specific authorities

7. Subordination Provisions: Required when there are multiple security interests requiring prioritization

What schedules should be included in a Third Party Collateral Agreement?

1. Schedule 1 - Description of Collateral: Detailed description and identification of the collateral assets

2. Schedule 2 - Secured Obligations: Detailed description of the secured obligations

3. Schedule 3 - Perfection Requirements: List of required filings, registrations, and notices

4. Schedule 4 - Forms of Notices: Template notices for relevant third parties

5. Schedule 5 - Additional Representations: Any additional representations specific to the collateral type

6. Appendix A - Forms of Transfer Documents: Template documents for transferring control or ownership of collateral

7. Appendix B - Enforcement Procedures: Detailed procedures for enforcement under Maltese law

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

Relevant legal definitions
Clauses
Relevant Industries

Banking

Financial Services

Investment Services

Corporate Services

Real Estate

Manufacturing

Trading

Shipping

Aviation

Insurance

Asset Management

Private Equity

Relevant Teams

Legal

Finance

Treasury

Risk Management

Compliance

Corporate Secretarial

Credit

Collateral Management

Transaction Management

Business Development

Relevant Roles

Legal Counsel

Corporate Lawyer

Finance Director

Security Trustee

Compliance Officer

Risk Manager

Corporate Secretary

Treasury Manager

Credit Manager

Collateral Manager

Transaction Manager

Business Development Director

Chief Financial Officer

Chief Legal Officer

Banking Relationship Manager

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