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Landlord Lien Subordination Agreement Template for England and Wales

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Key Requirements PROMPT example:

Landlord Lien Subordination Agreement

"Need a Landlord Lien Subordination Agreement for our London commercial property where our tenant, ABC Manufacturing Ltd, is seeking bank financing of £2M against their equipment, with the agreement to be effective from March 2025."

Document background
A Landlord Lien Subordination Agreement becomes necessary when a tenant seeks financing secured against assets located within leased premises. Under English and Welsh law, landlords typically have certain rights over tenant assets through their right of Commercial Rent Arrears Recovery. This agreement subordinates these rights to the lender's security interest, thereby facilitating tenant financing while protecting the lender's position. The agreement defines the relative priorities of the parties' rights, establishes notice requirements, and may include provisions for the lender to step into the tenant's position in case of default.
Suggested Sections

1. Parties: Identification of the landlord, tenant, and lender(s)

2. Background: Context of the lease, existing security interests, and reason for subordination

3. Definitions: Key terms including Property, Lease, Security Interest, Priority Date

4. Subordination: Core provisions regarding subordination of landlord's lien

5. Lender's Rights: Scope of lender's priority and enforcement rights

6. Landlord's Covenants: Landlord's obligations regarding the subordination

Optional Sections

1. Notice Requirements: Details of required notices between parties - use when specific notification procedures are needed

2. Insurance Provisions: Requirements for insurance and claims priority - use when insurance proceeds are relevant to security interests

3. Step-In Rights: Lender's rights to take over tenant's position - use when lender requires ability to step into lease

Suggested Schedules

1. Property Description: Detailed description of the property subject to the agreement

2. Lease Details: Summary of key lease terms and dates

3. Security Documents: List of relevant security documents and their priority

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok³ÉÈ˰æ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

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Industries

Law of Property Act 1925: Key legislation governing property rights, security interests and priorities. Contains crucial sections on landlord's rights and interests in property.

Landlord and Tenant Act 1954: Provides the fundamental framework for commercial tenancies in England and Wales, including landlord's rights and remedies.

Insolvency Act 1986: Crucial legislation dealing with creditor priorities and the treatment of security interests during insolvency proceedings.

Enterprise Act 2002: Contains important modifications to the insolvency regime and impacts security enforcement procedures.

Law of Distress/CRAR: Common law principle now replaced by Commercial Rent Arrears Recovery (CRAR) since 2014, governing landlord's rights to seize tenant property for unpaid rent.

Taking Control of Goods Regulations 2013: Regulations governing the procedure for taking control of goods, including provisions relevant to landlord enforcement rights.

Taking Control of Goods (Fees) Regulations 2014: Specific regulations dealing with fees and charges related to enforcement actions under CRAR.

Land Registration Act 2002: Legislation governing registered land in England and Wales, relevant when the property subject to the agreement is registered.

Companies Act 2006: Corporate legislation that must be considered when any of the parties to the agreement are companies.

Financial Collateral Arrangements (No.2) Regulations 2003: Regulations governing financial collateral arrangements, relevant if financial collateral is involved in the subordination agreement.

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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