Facility Objectives and Strategy Clause Samples

Facility Objectives and Strategy. The Facility, along with the SMCCF, is designed to achieve four objectives: (1) to support primary issuance for solvent borrowers at borrowing rates that are well aligned with the secondary market reflecting normalized levels; (2) to help solvent borrowers maintain business operations and capacity during the period of dislocations related to the pandemic; (3) to provide broad support for secondary credit markets to facilitate orderly and timely risk transfer; and (4) to reduce the incidence and severity of market dysfunction. The key mechanisms for the Facility to achieve the objectives are the purchase of corporate bonds and participation in loan syndications, and actions in furtherance of the objectives shall initially be limited to the purchase of Eligible Bonds. To achieve the objectives, the Company and Manager shall agree on a process for acquiring Eligible Bonds, reviewing eligibility criteria, performing initial due diligence, and calculating pricing for Eligible Sole Investor Bonds. The Manager shall execute purchases of Eligible Bonds that are in compliance with the Investment Guidelines. The Manager shall not have discretion with respect to the disposition of purchased Eligible Bonds without the prior consent of the Company. At such time as the Company determines to wind-down the Facility, the Manager shall collaborate with the Company to develop a program for engaging in dispositions, which includes criteria and mechanics for disposing of Eligible Bonds. The Manager will consult with, and obtain approval from, the Company prior to the disposition of Eligible Bonds in payment default or restructuring. To evaluate and monitor market dynamics, the Manager and the Company will agree on a set of metrics that assess the functioning of the corporate credit markets and can help identify the impact that asset purchases are having on the market. At program inception, these metrics are expected to include, at a minimum, oversubscription levels, failed transaction count, delta between initial price talk and final price, and new issue concessions. The Company shall periodically meet with the Manager in the manner set forth in Section 10 of the Agreement to discuss matters relating to the portfolio and related processes.