Amending security documents
Amending security documents

The following Banking & Finance practice note provides comprehensive and up to date legal information covering:

  • Amending security documents
  • Reasons for amending security documents and key risks
  • Reasons for amending a security document
  • Risks of amending security documents
  • Types of amendments
  • Altering the secured liabilities
  • New chargee
  • Changing the charging clause
  • Other substantive changes
  • Correction of non-substantive errors
  • More...

Amending security documents

Coronavirus (COVID-19): Transaction planning will need to take into account the impact of coronavirus (COVID-19) on execution of documents and company filing and administration procedures. For further information, see Practice Note: Coronavirus (COVID-19)—implications for lending transactions—Coronavirus (COVID-19)—impact on deal execution?

For wider information on key developments and related practical guidance on the implications of COVID-19 for lawyers, see: Coronavirus (COVID-19) toolkit and in relation to Banking & Finance specifically, see Practice Note: Coronavirus (COVID-19) implications for Banking & Finance lawyers.

Reasons for amending security documents and key risks

Reasons for amending a security document

There are situations where parties may consider amending security documents. Common examples include:

  1. the parties want to make changes to the obligations being secured

  2. the chargee wants to assign or novate its security following a transfer of the debt

  3. the parties want to charge additional assets or change the nature of an existing charge (eg from a floating charge to a legal mortgage), and

  4. the parties want to correct a mistake or document an amendment to what has been agreed

Parties may consider that amending a security document may be cheaper and easier than putting a new security document in place.

Risks of amending security documents

Depending on the type of amendment, there is a risk that a liquidator or administrator could argue that new security has been created risking the security being set aside

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