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Security Sharing Agreement Template for Singapore

A Security Sharing Agreement under Singapore law is a legally binding document that establishes the framework for multiple parties to share security interests over assets. It governs the ranking, priority, and enforcement rights of various secured creditors, ensuring orderly distribution of proceeds in case of enforcement. The agreement complies with Singapore's Securities and Futures Act and related regulations, providing clarity on intercreditor relationships and security enforcement procedures.

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What is a Security Sharing Agreement?

A Security Sharing Agreement becomes necessary when multiple creditors hold security interests over the same assets of a borrower. This agreement, governed by Singapore law, establishes the respective rights, priorities, and obligations of the secured parties. It details how security is shared, enforced, and how proceeds are distributed, while ensuring compliance with Singapore's regulatory framework. The document is particularly crucial in syndicated lending, project finance, and complex financial transactions where multiple secured creditors are involved.

What sections should be included in a Security Sharing Agreement?

1. Parties: Identification and details of all parties to the security sharing agreement

2. Background: Context, purpose, and commercial rationale for the security sharing arrangement

3. Definitions: Defined terms used throughout the agreement including security assets, enforcement events, and relevant terminology

4. Security Assets: Detailed description of the shared security and collateral covered by the agreement

5. Ranking and Priority: Establishment of priority rights and ranking among secured parties

6. Enforcement Rights: Rights, procedures, and mechanisms for enforcing security interests

7. Distribution of Proceeds: Rules and methodology for allocating enforcement proceeds among parties

8. Representations and Warranties: Standard representations and specific security-related warranties from each party

9. Covenants: Ongoing obligations regarding the security assets and maintenance of priority

10. Termination: Circumstances and procedures for terminating the agreement

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

1. Intercreditor Provisions: Additional provisions governing relationships between different classes of creditors

2. Standstill Provisions: Terms regarding temporary restrictions on enforcement actions

3. Security Agent Provisions: Appointment, powers, and duties of security agent if applicable

4. Cross-Border Provisions: Special provisions for security assets located in multiple jurisdictions

5. Voting Rights: Procedures for collective decision-making among secured parties

What schedules should be included in a Security Sharing Agreement?

1. Schedule of Security Assets: Comprehensive list and description of all security assets covered by the agreement

2. Form of Accession Deed: Standard form for new parties to accede to the agreement

3. Enforcement Procedures: Detailed step-by-step procedures for security enforcement actions

4. Priority Waterfall: Detailed breakdown of payment and distribution priorities

5. Notice Requirements: Forms and templates for various notices required under the agreement

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

Jurisdiction

Singapore

Publisher

Genie AI

Document Type

Security Agreement

Cost

Free to use

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