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The Collateral Agency Agreement is essential in complex financing transactions where multiple lenders require coordinated management and enforcement of security interests. This document becomes particularly relevant in the Indian market for syndicated loans, project finance, and other secured lending arrangements where security needs to be held and managed for the benefit of multiple secured parties. The agreement establishes the collateral agent's role, outlines the security package, and provides mechanisms for decision-making and enforcement actions. It must comply with Indian security laws, including the SARFAESI Act 2002, Transfer of Property Act 1882, and Companies Act 2013, while addressing practical aspects of security management and enforcement. The agreement is crucial for protecting lenders' interests while ensuring efficient administration of security through a single point of contact.

1. Parties: Identifies all parties to the agreement including the collateral agent, secured parties (typically banks/financial institutions), and borrower/security provider

2. Background: Sets out the context of the underlying facility/loan agreements and the need for appointing a collateral agent

3. Definitions and Interpretation: Defines key terms used throughout the agreement and establishes interpretation rules

4. Appointment and Authority: Details the appointment of the collateral agent and scope of its authority to act on behalf of secured parties

5. Duties of the Collateral Agent: Specifies the responsibilities and obligations of the collateral agent in managing and enforcing security

6. Rights and Protections of the Collateral Agent: Outlines the rights, protections, and indemnities available to the collateral agent

7. Security and Collateral: Details the security package, perfection requirements, and maintenance obligations

8. Payments and Application of Proceeds: Establishes the waterfall for distribution of enforcement proceeds and payment mechanics

9. Decision Making and Instructions: Sets out how secured parties make decisions and give instructions to the collateral agent

10. Resignation and Replacement: Procedures for resignation, removal, and replacement of the collateral agent

11. Fees and Expenses: Details the fee structure and expense reimbursement for the collateral agent

12. Communications: Specifies methods and requirements for notices and other communications

13. Miscellaneous: Standard boilerplate provisions including amendments, governing law, jurisdiction

14. Execution: Execution blocks for all parties