Definitions for floating charge
float·ing charge

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1. Floating charge

   A floating charge is a security interest over a fund of changing assets of a company or other legal person. Unlike a fixed charge, which is created over ascertained and definite property, a floating charge is created over property of an ambulatory and shifting nature, such as receivables and stock. The floating charge 'floats' or 'hovers' until the point at which it is converted ("crystallised") into a fixed charge, attached to specific assets of the business. This crystallisation can be triggered by a number of events. In most common law jurisdictions it is an implied term in the security documents creating floating charges that a cessation of the company's right to deal with the assets (including by reason of insolvency proceedings) in the ordinary course of business leads to automatic crystallisation. Additionally, security documents will usually include express terms that a default by the person granting the security will trigger crystallisation. In most countries floating charges can only be granted by companies. If an individual person or a partnership was to try to grant a floating charge, then in most jurisdictions which recognise floating charges this would be void as a general assignment in bankruptcy.Floating charges take effect in equity only, and consequently are defeated by a bona fide purchaser for value without notice of any asset covered by them. In practice, as the charger has power to dispose of assets subject to a floating charge, so this is only of consequence in relation to disposals that occur after the charge has crystallised.

WikidataRate this definition:0.0 / 0 votes

1. Floating charge

   A floating charge is a security interest over a fund of changing assets of a company or a limited liability partnership, which 'floats' or 'hovers' until the point at which it is converted into a fixed charge, at which point the charge attaches to specific assets of the company or LLP. This conversion into a fixed charge can be triggered by a number of events; inter alia, it has become an implied term in debentures that a cessation of the company's right to deal with the assets in the ordinary course of business leads to automatic crystallisation. Additionally, according to express terms of a typical loan agreement, default by the chargor is a trigger for crystallisation. Such defaults typically include non-payment, invalidity of any of the lending or security documents or the launch of insolvency proceedings. Floating charges can only be granted by companies or LLPs. If an individual person or a partnership was to purport to grant a floating charge, it would be void as a general assignment in bankruptcy. Floating charges take effect in equity only, and consequently are defeated by a bona fide purchaser for value without notice of any asset covered by them. In practice, as the chargor has power to dispose of assets subject to a floating charge, this is only of consequence in relation to disposals that occur after the charge has crystallised.

How to pronounce floating charge?

1. Alex

   US English

   David

   US English

   Mark

   US English

   Daniel

   British

   Libby

   British

   Mia

   British

   Karen

   Australian

   Hayley

   Australian

   Natasha

   Australian

   Veena

   Indian

   Priya

   Indian

   Neerja

   Indian

   Zira

   US English

   Oliver

   British

   Wendy

   British

   Fred

   US English

   Tessa

   South African

How to say floating charge in sign language?

Numerology

1. Chaldean Numerology

   The numerical value of floating charge in Chaldean Numerology is: 6

2. Pythagorean Numerology

   The numerical value of floating charge in Pythagorean Numerology is: 9

References

1. ^ Wikipedia
   https://en.wikipedia.org/wiki/Floating_Charge
2. ^ Wikidata
   https://www.wikidata.org/w/index.php?search=floating charge