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Loan Assumption Agreement
"I need a Loan Assumption Agreement to be used in Hong Kong where ABC Properties Limited will take over an existing HKD 50 million property development loan from XYZ Developers Limited, with completion targeted for March 2025 and including provisions for additional security over the development project."
1. Parties: Identifies all parties to the agreement including original lender, original borrower, and assuming borrower
2. Background: Recitals explaining the original loan agreement and the intention to assume the loan
3. Definitions and Interpretation: Defines key terms and establishes interpretation rules for the agreement
4. Assumption of Loan: Core provision detailing the assumption of rights and obligations under the original loan
5. Conditions Precedent: Conditions that must be satisfied before the assumption becomes effective
6. Representations and Warranties: Statements of fact and assurances from the assuming borrower
7. Covenants: Ongoing obligations and commitments of the assuming borrower
8. Original Borrower Release: Terms of release of the original borrower from loan obligations
9. Fees and Expenses: Allocation of costs and fees related to the assumption
10. Notices: Communication procedures between parties
11. Governing Law and Jurisdiction: Specifies Hong Kong law as governing law and jurisdiction for disputes
12. Execution: Signature blocks and execution requirements
1. Security Arrangements: Include when the loan is secured by collateral that needs to be transferred or renewed
2. Guarantor Provisions: Required when there are guarantors for the assuming borrower
3. Insurance Requirements: Include when specific insurance must be maintained on collateral
4. Tax Provisions: Include when there are specific tax implications or requirements for the assumption
5. Regulatory Compliance: Include when the assumption requires specific regulatory approvals or compliance
6. Interest Rate Adjustment: Include when the assumption involves changes to interest rate terms
7. Payment Restructuring: Include when payment terms are being modified as part of the assumption
1. Schedule 1 - Original Loan Agreement Details: Copy or summary of the original loan agreement terms
2. Schedule 2 - Outstanding Loan Amount and Payment Schedule: Current loan balance and payment requirements
3. Schedule 3 - Security Details: Description of any security or collateral for the loan
4. Schedule 4 - Conditions Precedent Documents: List of required documents and conditions to be satisfied
5. Schedule 5 - Form of Notices: Template notices required for the assumption process
6. Appendix A - Relevant Consents and Approvals: Copies of required third-party consents and regulatory approvals
7. Appendix B - Due Diligence Documents: List and copies of due diligence documents provided by assuming borrower
Authors
Banking & Financial Services
Real Estate
Commercial Property
Infrastructure
Manufacturing
Retail
Healthcare
Hospitality
Construction
Energy
Transportation
Technology
Legal
Finance
Treasury
Credit Risk
Compliance
Corporate Finance
Loan Administration
Transaction Management
Risk Management
Company Secretarial
Chief Financial Officer
Finance Director
Treasury Manager
Loan Officer
Credit Manager
Legal Counsel
Compliance Officer
Risk Manager
Corporate Finance Manager
Financial Controller
Banking Relationship Manager
Property Finance Manager
Debt Management Officer
Transaction Manager
Corporate Secretary
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