THIS DEED OF SUBORDINATION is made the
Between:-
day of
Two thousand (20
)
(1)
a company incorporated in the Republic of Singapore and having its registered office at
(hereinafter called “the Borrower”);
(2)
(hereinafter called “the Subordinated Lender”); and
(3) OVERSEA-CHINESE BANKING CORPORATION LIMITED a company incorporated in the
Republic of Singapore and having its registered office at 65 Chulia Street #09-00 OCBC Centre,
Singapore 049513 (hereinafter called “the Senior Lender”).
WHEREAS:(1)
The Senior Lender has agreed to make or continue to make loans or advances or give or
continue to give credit facilities or grant banking facilities or other accommodation to the Borrower
from time to time for so long as the Senior Lender thinks fit at its absolute discretion and to such
an extent and on such terms as may from time to time be fixed by the Senior Lender at its
absolute discretion.
(2)
It was (inter alia) a condition of the aforesaid agreement (“the agreement”) that the Borrower and
the Subordinated Lender would enter into this Deed of Subordination with the Senior Lender and
the Subordinated Lender has agreed to subordinate all sums for which the Borrower is presently
indebted and may hereafter become indebted to any of the Subordinated Lender in respect of
loans, advances and credit granted now or hereafter (referred to hereinafter as “the Subordinated
Indebtedness”) in the manner particularly described below.
NOW THIS DEED WITNESSETH as follows:1.
(a)
In consideration of the Senior Lender making or continuing to make loans or advances or
giving or continuing credit or banking facilities or other accommodation to the Borrower
from time to time to such extent and on such terms and conditions and for so long as the
Senior Lender may think fit, the Borrower and the Subordinated Lender hereby
acknowledge and jointly and severally undertake and agree with each other and with the
Senior Lender that, so long as any sum or liability or obligation is owing by the Borrower to
the Senior Lender or remains outstanding, and unless the Senior Lender otherwise
consents, the Subordinated Indebtedness shall be subordinated to all sums, obligations
and liabilities now owing or which may hereafter become owing by the Borrower to the
Senior Lender, or outstanding and accordingly, during such period shall be subject to the
following terms and conditions:(i)
the Subordinated Indebtedness shall, unless the Senior Lender consents, not be
subject to payment of interest (although interest may accrue thereon);
(ii)
subject to Clause 2, the Subordinated Indebtedness shall not directly or indirectly be
repayable or repaid or exchanged in whole or in part;
(iii)
the Subordinated Lender shall not demand from the Borrower repayment of the
Subordinated Indebtedness or any part thereof or take any steps, actions or
proceedings anywhere, directly or indirectly, to recover or enforce repayment of the
same or any part thereof in any way;
(iv)
the Subordinated Indebtedness is and shall remain unsecured by any mortgage,
charge, debenture or other security of any kind over the whole or any part of the
OCBC Legal / Jun 2009
1
assets of the Borrower and is not and shall not be capable of becoming subject to
any right of setoff or counterclaim;
(v)
subject to Clause 2, the Subordinated Lender shall not waive any of its rights in
respect of the Subordinated Indebtedness or agree to any amendment to the terms
on which any of the Subordinated Indebtedness has been made or is owing, without
the consent of the Senior Lender;
(vi)
the Subordinated Lender shall not in any way combine or consolidate or purport to
combine or consolidate the Subordinated Indebtedness or any part thereof with any
of its liabilities to the Senior Lender or set off all or any part of the Subordinated
Indebtedness in satisfaction of all or any of the liabilities of the Subordinated Lender;
(vii)
the Subordinated Lender shall not take or accept any loans or advances whether
directly or indirectly from the Borrower or take or accept any gift in cash or in kind or
obtain or procure any guarantee indemnity or security to be given or issued by the
Borrower for or in connection with any of the indebtedness or liabilities of the
Subordinated Lender; and
(viii) the Subordinated Lender shall not cause procure permit or suffer the Borrower to sell
transfer or in any way dispose of any of the Borrower’s property or assets to the
Subordinated Lender in any manner whatsoever save and except at arm’s length and
for valuable and adequate consideration which shall be fully paid for by the
Subordinated Lender in cash.
2.
3.
(b)
Should any payment be received or recovered by the Subordinated Lender (or any one of
them), from any person in breach of Clause 1(a), the Subordinated Lender (or any one of
them) shall hold the proceeds of such payment in trust for the Borrower and shall
accordingly forthwith return the amount of any such payment to the Borrower provided that
if there shall be any monies due and payable by the Borrower to the Senior Lender at any
time when the Subordinated Lender (or any one of them) shall have received a payment as
aforesaid or at any time before the amount of the relevant payment is returned to the
Borrower, the Subordinated Lender (or any one of them) shall pay to the Senior Lender the
whole of the said payment or (if less) such part thereof as shall be equal to the amount of
the said monies so due and payable and in making such payment shall discharge (in whole
or in part, as the case may be) its obligations in respect of the trust referred to above.
(c)
Should any part of the Subordinated Indebtedness be secured in the manner described in
Clause 1(a)(iv) in breach of Clause 1(a), then the Subordinated Lender (or any one of
them) shall hold such security in trust for the Borrower and shall accordingly forthwith
transfer or release such security to the Borrower.
The Subordinated Lender hereby agrees with the Borrower and the Senior Lender that in the
event of any appointment of a judicial manager or receiver for the Borrower, or on a winding up or
bankruptcy (where applicable) of the Borrower (or any one of them), the Subordinated
Indebtedness shall be subordinated to all amounts then owing by the Borrower to the Senior
Lender and that, accordingly, amounts payable to the Subordinated Lender by the judicial
manager, the receiver, the liquidator or the official assignee (where applicable) on a winding-up
or bankruptcy (where applicable) of the Borrower (or any one of them) in respect of the
Subordinated Indebtedness then owing to it will be applied:(a)
first, in payment of the claims of the Senior Lender; and
(b)
secondly, towards the payment of the amount owing to the Subordinated Lender in respect
of the Subordinated Indebtedness.
The Borrower hereby declares and acknowledges that the benefit to the Borrower of the
undertaking on the part of each Subordinated Lender contained in Clause 2 of this Deed of
Subordination is held in trust by the Borrower (or any one of them):-
OCBC Legal / Jun 2009
2
(a)
first, for the Senior Lender to the extent that the claims of the Senior Lender in respect of
any sum or liability or obligation owing by the Borrower to the Senior Lender shall not have
been met by means of the enforcement of any security held by or on behalf of the Senior
Lender or from any other source; and
(b)
secondly, for such Subordinated Lender to be applied towards the payment of the amount
owing to such Subordinated Lender in respect of the Subordinated Indebtedness.
4.
The trusts created by Clauses 1 and 3 of this Deed of Subordination shall be of a duration of 21
years.
5.
The Subordinated Lender hereby undertakes with the Senior Lender that the claims of such
Subordinated Lender in respect of the Subordinated Indebtedness will be proved by such
Subordinated Lender in any winding-up or bankruptcy (where applicable) of the Borrower. The
Subordinated Lender hereby irrevocably for the duration of this Deed of Subordination authorises
the Senior Lender to file any proof of debt that is necessary to give effect to the obligation of the
Subordinated Lender hereunder.
6.
For all purposes, including any legal proceedings, a certificate by any of the officers of the Senior
Lender as to the sums and liabilities and obligations for the time being owing due or incurred to
the Senior Lender by the Borrower shall be prima facie evidence thereof.
7.
The Subordinated Lender undertakes that it shall not (without the prior written consent of the
Senior Lender, which may be given subject to such conditions as the Senior Lender may think fit)
assign, charge, mortgage, transfer, or otherwise dispose of any rights of or purport or agree to
assign, charge, mortgage, transfer, or otherwise dispose of any rights which may from time to
time and for the time being have against the Borrower (or any one of them) in respect of the
Subordinated Indebtedness or any transactions relating thereto.
8.
This Deed of Subordination shall be binding upon and enure to the benefit of the parties hereto
and their respective successors and permitted assigns (as the case may be), but the Borrower
and the Subordinated Lender shall not assign or transfer any of their respective rights and
obligations hereunder without the prior written consent of the Senior Lender.
9.
The Senior Lender may assign this Deed or the whole or a portion of its rights hereunder, in
which event references herein to the Senior Lender shall thenceforth be deemed to include a
reference to such assignee to the extent of its interest.
10.
If at any time any one or more provisions hereof is or shall become invalid, illegal or
unenforceable in any respect under any law, the validity, legality and enforceability of the
remaining provisions hereof shall not in any way be affected or impaired thereby.
The Borrower and the Subordinated Lender hereby jointly and severally agree that the
Subordinated Indebtedness shall not be assignable except subject to the rights of the Senior
Lender under this Deed and the Subordinated Lender undertakes with the Borrower and with the
Senior Lender that it shall not assign or purport to assign any rights which it may from time to time
and for the time being have against the Borrower in respect of the Subordinated Indebtedness or
any transactions relating thereto.
11.
12.
The Borrower and the Subordinated Lender shall execute and deliver to the Senior Lender such
deeds, documents and other instruments as maybe requested by the Senior Lender from time to
time in order to enable the Senior Lender to enforce, protect or perfect any and all of its rights or
claims pursuant to this Deed or as contemplated by this Deed.
13.
The Subordinated Lender shall not by virtue of any payment or distribution or other benefit in
respect of the Subordinated Indebtedness or any part of it received by the Senior Lender be
entitled to any right of subrogation.
14.
Any money received by the Senior Lender in connection with the agreement may be placed to the
credit of a suspense account with a view to preserving the rights of the Senior Lender to prove for
OCBC Legal / Jun 2009
3
the whole of its claims against the Borrower or any other person or entity liable and, until applied
by the Senior Lender in or towards satisfaction of all sums, liabilities and obligations due to it, the
same shall not be treated as reduced or discharged by any such receipt.
15.
The Borrower and the Subordinated Lender jointly and severally acknowledge the priority given to
all sums, liabilities and obligations now owing or which may hereafter be owing to the Senior
Lender and shall not omit or attempt to omit or take any action whatsoever which might, in any
way, prejudice, impair or affect that priority.
16.
The Borrower and the Subordinated Lender each hereby irrevocably appoint for the duration of
this Deed the Senior Lender and any person nominated in writing by any officer of the Senior
Lender, including, where applicable, every receiver, receiver and manager or administrative
receiver or similar officer appointed by the Senior Lender over the Borrower or in respect of any
of its property or assets, as attorney of the Borrower or the Subordinated Lender or both with full
power of substitution for the Borrower or the Subordinated Lender or both and in its name and on
its behalf and as its act and deed to execute, seal and deliver and otherwise perfect any deed,
assurance, agreement, instrument or to do or perform any act that may be required or deemed
proper for any of the purposes of this Deed.
17.
No failure or delay by the Senior Lender in exercising any right, power or privilege under this
Deed shall operate as a waiver of it, nor shall any single or partial exercise of any right, power or
privilege preclude any further exercise of it or the exercise of any other right, power or privilege.
The rights and remedies provided in this Deed are cumulative and are not exclusive of any rights
and remedies provided by law.
18.
Neither the Borrower nor the Subordinated Lender shall be exonerated by any act, omission or
circumstance which, but for this provision, might operate to release or otherwise exonerate any
one of them from their respective obligations hereunder, including, without limitation, and whether
or not known to any one of them or to the Senior Lender:(a)
any time or indulgence granted by the Senior Lender to, or composition with the Borrower
or any other person or entity; or
(b)
the variation, compromise, renewal or release of, or refusal or neglect to perfect or enforce
any rights, remedies or securities against or granted by the Borrower or any other person or
entity; or
any amendment to, or variation of any of the terms upon which the Senior Lender has
granted to the Borrower, or continue to make available to the Borrower loans advances
credit and other banking facilities and other accommodation; or
(c)
19.
20.
(d)
any legal limitation, disability, incapacity or other circumstances relating to the parties
hereto or any amendments to the terms of the agreement or to any other documents or
security interest whatsoever.
(a)
The Borrower and the Subordinated Lender shall be jointly and severally liable to pay, on
demand, all costs and expenses (including legal fees) incurred or to be incurred by the
Senior Lender in the preparation and execution of, the preservation of any rights under, and
the enforcement of this Deed of Subordination.
(b)
The Borrower and the Subordinated Lender shall also be jointly and severally liable to pay,
on demand, all stamp or documentary duties or taxes (if any) which may be payable or
determined to be payable in connection with the making, performance or enforcement of
this Deed of Subordination.
(a)
Any notice or certificate to be given to, or demand to be made on, the Borrower and/or the
Subordinated Lender (notwithstanding the death, insanity, bankruptcy, liquidation, whether
voluntary or compulsory, or dissolution of the Borrower and/or the Subordinated Lender)
shall be deemed to have been duly given or made if it is in writing, signed by an authorised
officer of the Senior Lender or person/corporation/firm for the time being acting as solicitor
OCBC Legal / Jun 2009
4
or solicitors for the Senior Lender, and delivered personally or sent by telex, facsimile,
telegram or pre-paid post addressed to the party to be notified and forwarded to:(i)
the address(es) of the Borrower and/or the Subordinated Lender as shown herein or,
where a new address has been notified in writing to the Senior Lender, that new
address;
(ii)
in the case of a corporation, its registered office;
(iii)
the address of any property of the Borrower and/or the Subordinated Lender
mortgaged to the Senior Lender;
or
(iv)
the Borrower’s and/or the Subordinated Lender’s last known place of business or
abode in Singapore.
(b)
A communication sent by mail shall be deemed to have been received by the Borrower
and/or the Subordinated Lender on the second day after posting (excluding days on which
no mail deliveries are normally made) notwithstanding that it may be returned by the post
office undelivered.
(c)
A communication sent by telex, facsimile or telegram shall be deemed to have been
received by the Borrower and/or the Subordinated Lender at the time of despatch.
(d)
If the Borrower and/or the Subordinated Lender is more than one person the service of a
notice or demand on any such person shall be deemed to be service upon all such
persons.
(e)
A statement signed by an authorised officer of the Senior Lender or person/
corporation/firm for the time being acting as solicitor or solicitors for the Senior Lender
stating the date upon which any demand or notice was posted shall in the absence of
manifest error beprima facie evidence of the date upon which that demand or notice was
posted.
(f)
Notices, certificates and other correspondence in connection herewith required to be sent
or given to the Senior Lender shall be addressed by the Borrower and/or the Subordinated
Lender and shall be sent to the Senior Lender’s address(es) specified herein (or to such
other address(es) as may from time to time be given by the Senior Lender to the Borrower
and/or the Subordinated Lender for the purpose). Any such notice shall be deemed to have
been given, sent, served or received at the time of acknowledgement of receipt by a duly
authorised officer of the Senior Lender.
21.
All sums payable by the Subordinated Lender under this Deed shall be paid (a) free of any
restriction or condition, (b) free and clear of and (except to the extent required by law) without any
deduction or withholding on account of any tax and (c) without deduction or withholding (except to
the extent required by law) on account of any other account, whether by way of set-off
counterclaim or otherwise and insofar as any deduction or withholding is required by law, the sum
payable by the Subordinated Lender shall be increased to the extent necessary to ensure that,
after the making of that deduction, withholding or payment the Senior Lender receives on the due
date and retains (free from any liability in respect of any such deduction, withholding or payment)
a net sum equal to what it would have received and so retained had no such deduction,
withholding or payment been required or made.
22.
(a)
All sums payable by the Subordinated Lender under or in connection with this Deed shall
be made in Singapore Dollars.
(b)
Any amount received or recovered in a currency other than Singapore Dollars (whether as
a result of, or of the enforcement of, a judgment or order of a court of any jurisdiction, in a
winding-up or bankruptcy or otherwise) by the Senior Lender in respect of the Subordinated
Indebtedness expressed to be due to the Senior Lender from the Subordinated Lender
OCBC Legal / Jun 2009
5
under this Deed shall only constitute a discharge to that Subordinated Lender to the extent
of the Singapore Dollar amount which the Senior Lender is able, in accordance with its
usual practice, to purchase with the amount so received or recovered in that other currency
on the date of that receipt or recovery (or, if it is not practicable to make that purchase on
that date, on the first date on which it is practicable to do so).
(c)
If that Singapore Dollar amount is less than the Singapore Dollar amount expressed to be
due to the Senior Lender under this Deed, the Subordinated Lender shall indemnify the
Senior Lender against any loss sustained by the Senior Lender as a result thereof. In any
event, the Subordinated Lender shall indemnify the Senior Lender against the cost of
making any such purchase.
(d)
These indemnities constitute a separate and independent obligation from the other
obligations under this Deed, shall give rise to a separate and independent cause of action,
shall apply irrespective of any indulgence granted by the Senior Lender and shall continue
in full force and effect despite any judgment, order, claim or proof for a liquidated amount in
respect of any sum due under this Deed or any judgment or order.
23.
This Deed may be executed and delivered in separate counterparts, each of which when so
executed and delivered shall be an original, but all such counterparts shall together constitute
one and the same instrument.
24.
(a)
This Deed shall be construed and governed by the laws of Singapore.
(b)
(i)
Where there is more than one Borrower all references to “the Borrower” in this Deed
shall refer to all or (if the context so admits) any one or more of them and all
covenants, agreements, undertakings, terms, stipulations, and other provisions
hereof shall be deemed to be made by and be binding on all of them jointly and
severally; and
(ii)
Where there is more than one Subordinated Lender all references to “the
Subordinated Lender” in this Deed shall refer to all or (if the context so admits) any
one or more of them and all covenants, agreements, undertakings, terms,
stipulations, and other provisions hereof shall be deemed to be made by and be
binding on all of them jointly and severally.
25.
(c)
The Borrower and the Subordinated Lender hereby irrevocably and unconditionally submit
to the non-exclusive jurisdiction of the Courts of Singapore.
(d)
Where the Borrower and/or the Subordinated Lender is a foreigner or a corporation
incorporated outside Singapore, the Borrower and/or the Subordinated Lender shall at all
times maintain an agent for service of process in Singapore and any writ, judgment or other
notice of legal process shall be sufficiently served on the Borrower and/or the Subordinated
Lender if delivered to such respective agent at its address for the time being notified to the
Senior Lender. The Borrower and/or the Subordinated Lender undertakes not to revoke the
authority of such agent and if, for any reason, any agent no longer serves as its agent to
receive service of process, another agent will be immediately appointed and the Senior
Lender advised accordingly.
The Borrower and the Subordinated Lender hereby expressly and irrevocably permit and
authorise the Senior Lender and the Senior Lender’s officers to disclose, reveal and divulge at
any time in such manner and under such circumstances as the Senior Lender deems necessary
or expedient in its sole discretion without prior reference to the Borrower and/or the Subordinated
Lender, any and all information and particulars relating to and in connection with the Borrower
and/or the Subordinated Lender, any and all of the Borrower’s accounts with the Senior Lender
(whether held alone or jointly), the Borrower’s and/or the Subordinated Lender’s credit standing
and financial position, any transactions or dealings between the Borrower, the Subordinated
Lender and/or the Senior Lender, any facilities granted to the Borrower, this Deed, to any person
at any time and from time to time, including but not limited to:-
OCBC Legal / Jun 2009
6
(a)
any person who may enter into a contractual relationship with the Senior Lender;
(b)
(c)
any of the Senior Lender’s subsidiaries, branches, agents, correspondents, agencies or
representative offices;
the Senior Lender’s auditors and professional advisors including its solicitors;
(d)
any of the Senior Lender’s potential assignee or transferee;
(e)
any person who has given any security to the Senior Lender for any facilities granted to the
Borrower;
(f)
any person who is jointly or jointly and severally liable to the Senior Lender with the
Borrower and/or the Subordinated Lender;
(g)
the police or any public officer conducting an investigation in connection with any offence
including suspected drug trafficking offences;
(h)
the Senior Lender’s stationery printers the vendors of the computer systems used by the
Senior Lender and to such person(s) installing and maintaining the same and other
suppliers of goods or service providers engaged by the Senior Lender;
(i)
any receiver appointed by the Senior Lender;
(j)
any person to whom disclosure is permitted or required by any statutory provision by law;
(k)
any credit bureau of which the Senior Lender is a member, any other member(s) and/or
compliance committee of such credit bureau; and/
or
(l)
any governmental agencies and authorities in Singapore and elsewhere.
26.
A person who is not a party to this Deed shall have no rights under the Contracts (Rights of Third
Parties) Act (Cap 53B) to enforce any of its terms.
27.
In this Deed:(1)
(2)
(3)
(4)
references to a “person” shall include an individual, firm, company, corporation and
unincorporated body of persons;
references to “Clauses” are references to clauses of this Deed as amended from time to
time;
words importing the singular number shall include the plural number and vice versa; and
words importing the masculine gender shall include the feminine and neuter gender and
vice versa.
IN WITNESS WHEREOF the parties hereto have executed this Deed this
Two thousand and
(20 ).
The Common Seal of the Borrower
was hereunto
affixed in the presence of:-
)
)
)
)
_______________________________
DIRECTOR
OCBC Legal / Jun 2009
7
day of
_______________________________
DIRECTOR/SECRETARY
SIGNED SEALED and DELIVERED by the
Borrower
by its Attorney
acting under a Power of Attorney dated the
day of
(a copy of
which was deposited in the Registry of the
Supreme Court, Singapore on the
day of
and
registered as No.
of ) in the
presence of:-
The Common Seal of the
Subordinated Lender
was hereunto affixed in the
presence of:-
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
______________________________
DIRECTOR
______________________________
DIRECTOR/SECRETARY
SIGNED SEALED and DELIVERED by the
Subordinated Lender
by its Attorney
acting under a Power of Attorney dated the
day of
(a copy of
which was deposited in the Registry of the
Supreme Court, Singapore on the
day of
and
registered as No.
of ) in the
OCBC Legal / Jun 2009
)
)
)
)
)
)
)
)
)
)
)
8
presence of:-
)
Signed Sealed and Delivered by the
Subordinated Lender
)
)
)
)
)
in the presence of:-
Signed Sealed and Delivered by the
Subordinated Lender
in the presence of:-
Signed Sealed and Delivered by the
Subordinated Lender
in the presence of:-
SIGNED SEALED and DELIVERED by
OVERSEA-CHINESE BANKING
CORPORATION LIMITED by its Attorney
acting under a Power of Attorney
dated the
day of
(a copy of which was deposited in
the Registry of the Supreme Court,
Singapore on the
day of
and registered as No.
of
) in the presence of:-
OCBC Legal / Jun 2009
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
9