On the date that the Custodied Loans become available (the Effective Date), the collateral relating to the Custodied Loans will be segregated from the collateral relating to the Standard Loans, and ring-fenced from the credit risk associated with the rehypothecation of Standard Loan collateral.
As such, on the Effective Date, all active Standard Loans will be assigned by Ledn to a Ledn single purpose entity that will only engage in Standard Loan-related activities. No action is required to be taken by any existing Standard Loan Clients.