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Irrevocable Pledge Agreement for the United Kingdom

Irrevocable Pledge Agreement Template for England and Wales

An Irrevocable Pledge Agreement under English and Welsh law is a legally binding document that creates a security interest over specific assets in favor of a pledgee. The agreement establishes the pledgor's unconditional and irrevocable commitment to maintain the pledge until the secured obligations are fully satisfied. It includes detailed provisions on the nature of the pledged assets, enforcement mechanisms, and the parties' respective rights and obligations, all governed by the laws of England and Wales.

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Irrevocable Pledge Agreement

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What is a Irrevocable Pledge Agreement?

An Irrevocable Pledge Agreement is commonly used in secured financing transactions where a party needs to provide security over specific assets while retaining possession. This document is particularly relevant when the underlying transaction requires a robust security arrangement that cannot be unilaterally revoked. The agreement, governed by English and Welsh law, typically details the pledged assets, enforcement mechanisms, and the parties' obligations. It's frequently used in conjunction with facility agreements, loan documents, or other financing arrangements where security is required.

What sections should be included in a Irrevocable Pledge Agreement?

1. Parties: Identification of pledgor and pledgee

2. Background: Context of the pledge and underlying obligations

3. Definitions: Key terms used throughout the agreement

4. Pledge: Core pledge obligations and asset description

5. Representations and Warranties: Statements about ownership and authority to pledge

6. Covenants: Ongoing obligations of the pledgor

7. Enforcement: Rights and remedies upon default

8. Governing Law and Jurisdiction: Choice of law and dispute resolution

What sections are optional to include in a Irrevocable Pledge Agreement?

1. Security Perfection: Additional steps required to perfect the security - used when dealing with specific types of assets requiring registration

2. Income and Voting Rights: Treatment of dividends and voting rights - used when pledged assets are shares or similar securities

3. Insurance: Requirements for insurance of pledged assets - used when pledged assets are physical property

What schedules should be included in a Irrevocable Pledge Agreement?

1. Schedule 1 - Description of Pledged Assets: Detailed description of assets subject to pledge

2. Schedule 2 - Form of Notice: Template notices to perfect the pledge

3. Schedule 3 - Powers of Attorney: Standard form powers of attorney

4. Schedule 4 - Form of Transfer Documents: Templates for transferring pledged assets upon enforcement

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

England and Wales

Document Type

Security Agreement

Cost

Free to use
Relevant legal definitions




























Clauses


























Industries

Law of Property Act 1925: Primary legislation governing security interests and property rights in England and Wales. Essential for establishing the fundamental rules of creating and enforcing security interests through pledges.

Financial Collateral Arrangements (No.2) Regulations 2003: Specific regulations governing pledges involving financial collateral, implementing EU Directive requirements for financial collateral arrangements.

Companies Act 2006: Key legislation for corporate pledgors/pledgees, including requirements for registration of company charges and corporate authentication requirements.

Consumer Credit Act 1974: Relevant when the pledge agreement involves consumer transactions, providing consumer protection measures and regulatory requirements.

Common Law Security Principles: Established case law principles governing creation, perfection, and enforcement of security interests including pledges.

Equitable Principles: Fundamental principles of equity affecting pledge agreements, including rules of fairness and conscience in security arrangements.

Rule Against Penalties: Legal doctrine ensuring that penalty clauses in pledge agreements are not enforceable, only genuine pre-estimates of loss.

Bills of Sale Acts 1878 and 1882: Historical legislation still relevant for pledges involving personal chattels, governing documentation and registration requirements.

Insolvency Act 1986: Critical legislation governing the treatment of pledges in insolvency scenarios, including enforcement rights and priority rules.

Sale of Goods Act 1979: Relevant when pledges involve goods, governing the transfer of title and rights in relation to goods.

Financial Services and Markets Act 2000: Regulatory framework applicable when pledge involves regulated financial instruments or regulated entities.

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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