1. What is crucial for borrowers to assess when considering security offered to a lender?

a) Maximum loan amount

b) Flexibility needed to deal with assets during the loan term and operational practicalities

c) Lender's credit history

d) Stock market trends

2. What is the fundamental document in an English security package that grants a lender  security over all the borrower's assets?

a) Mortgage

b) Shareholder's Security Agreement

c) Debenture

d) Guarantee

3. What is the likely scenario if CPs cannot be satisfied or waived?

a) The borrower must renegotiate the loan terms

b) The lender is obliged to lend

c) The lender isn't obliged to lend

d) The borrower can choose to withdraw the loan request

4. What is the consequence of not complying with Conditions Subsequent (CSs) by the specified date?

a) Immediate loan drawdown

b) Triggering an event of default

c) Extension of the deadline

d) Waiver of CS requirements

5. What does the Insurance Broker’s Letter (IBL) provide in a REF transaction?

a) Assignment of the insurance policies

b) Confirmation from the borrower about insurance coverage

c) Third-party confirmation that the policies meet FA requirements

d) Legal advice on insurance matters

6. When is the ideal time for borrowers to start thinking about refinancing before their current loan expires? 

a) 3 months before expiration 

b) At least 6 months before expiration

c) 1 year before expiration 

d) At the last minute

7. Why is it important for borrowers to ensure that all charged assets are released and documents returned upon full repayment of secured debts?

a) To increase their credit rating

b) To facilitate future disputes

c) To ensure a clean break and prevent future disputes

d) To maintain control over assets

8. What advantages does refinancing with an existing lender have? 

a) Lower transaction execution costs 

b) Quicker process 

c) Existing documentation that can be amended 

d) All of the above

9. What is the common misconception about security in a refinance with an existing lender? 

a) Existing lenders never require new security 

b) Existing security automatically extends to amended debt

c) Lenders are not concerned about the security package 

d) New security is only required for new lenders

10. What should borrowers consider regarding commitment fees in the event of a bank's insolvency?

a) Commitment fees will be waived automatically.

b) Commitment fees will cease to accrue during insolvency.

c) Cancel undrawn commitments where possible as commitment fees will continue to accrue

d) Commitment fees are paid to the borrower.

11. What is a potential misunderstanding borrowers might have about set-off during lender insolvency?

a) Set off is always allowed in finance documents.

b) Set off is effective only with a court order.

c) Set off is possible only for new arrangements.

d) Set off is generally prohibited unless explicitly allowed in finance documents

12. What is the potential consequence if an overseas entity fails to file an annual update under the ECTEA?

a) A warning letter

b) Suspension of land transactions

c) Criminal offence and financial penalty 

d) Mandatory audit

Season's Greetings and Happy New Year