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Landlord Subordination Agreement Template for England and Wales

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Key Requirements PROMPT example:

Landlord Subordination Agreement

"Need a Landlord Subordination Agreement for our London office property where our tenant, TechStart Ltd, is taking out a £2M loan from Barclays Bank, to be completed by March 2025."

Document background
A Landlord Subordination Agreement becomes necessary when a tenant seeks financing secured against their leasehold interest. The agreement establishes the relative priorities between the landlord's rights under the lease and the lender's security interests. Under English and Welsh law, this document typically includes provisions regarding rent collection, default scenarios, and step-in rights. The agreement helps facilitate commercial lending by providing lenders with certainty regarding their security position and rights in relation to the landlord's interests.
Suggested Sections

1. Parties: Identifies all parties to the agreement (typically landlord, tenant, and lender)

2. Background: Explains the context of the agreement and existing relationships between parties

3. Definitions: Defines key terms used throughout the agreement

4. Subordination Provisions: Core terms establishing the subordination of landlord's rights

5. Priority Agreement: Establishes order of priority between competing interests

6. Governing Law: Specifies applicable law and jurisdiction

Optional Sections

1. Notice Requirements: Used when specific notice procedures are required between parties for formal communication between landlord, tenant, and lender

2. Step-In Rights: Provisions detailing lender's rights to take over tenant's position in specific circumstances

3. Insurance Provisions: Specific arrangements regarding insurance proceeds and their priority between parties

Suggested Schedules

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

2. Lease Details: Summary of key lease terms affected by the subordination agreement

3. Security Documents: List and details of relevant security documents referenced in the agreement

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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Relevant Industries
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Industries

Law of Property Act 1925: Primary legislation governing real property in England and Wales, particularly relevant for sections dealing with legal estates, interests in land, and priority of interests

Land Registration Act 2002: Covers registration requirements, priority of registered interests, and notice requirements for interests in land

Landlord and Tenant Act 1954: Key legislation governing commercial tenancies and security of tenure considerations in England and Wales

Law of Property (Miscellaneous Provisions) Act 1989: Sets out formal requirements for contracts relating to land and creation of legal interests, particularly Section 2 requirements

Priority Rules (Common Law): Common law principles governing the order of priority between competing interests in property

Doctrine of Notice: Common law principle concerning the effect of notice (actual, constructive, or imputed) on priorities between competing interests

Contractual Interpretation Principles: Common law principles governing how courts interpret contractual terms and agreements

Insolvency Act 1986: Relevant for understanding priority rules in insolvency scenarios and their impact on subordination arrangements

Companies Act 2006: Applicable when parties to the subordination agreement are companies, covering corporate capacity and authority

Financial Services and Markets Act 2000: Relevant when lenders are regulated entities, ensuring compliance with financial services regulations

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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