| Commentary

60 Documentation

| Commentary

60 Documentation

Documentation should be drafted so that the benefit of any transaction which in effect reduces the junior debt should be made available to the senior creditor. Examples are payments under guarantee of the junior debt or the proceeds of security given by a third party for the junior debt or recoveries in kind such as the issue of debt securities or equity securities in satisfaction of all or part of the junior debt.

It is important to bear in mind that whichever procedure is adopted the requirement to turnover only exists if there is a dividend payment and thus

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