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Debt Assumption Agreement
"I need a Debt Assumption Agreement under German law where our subsidiary GmbH will assume a €5 million corporate loan from our parent company, with the transfer to be effective from March 1, 2025; the creditor is Deutsche Bank AG."
1. Parties: Identification of the original debtor, the assuming party (new debtor), and the creditor
2. Background: Description of the original debt relationship and the circumstances leading to the debt assumption
3. Definitions: Definitions of key terms used throughout the agreement
4. Object of Assumption: Detailed description of the debt being assumed, including amount, origin, and current status
5. Assumption Declaration: Formal declaration of debt assumption and the effective date
6. Creditor's Consent: Documentation of the creditor's consent to the debt assumption
7. Rights and Obligations: Description of the rights and obligations of all parties following the assumption
8. Representations and Warranties: Essential representations and warranties from all parties
9. Notices: Provisions regarding how formal communications between parties should be made
10. Governing Law and Jurisdiction: Confirmation of German law application and jurisdiction
11. Severability: Standard clause addressing the severability of contract provisions
1. Security Arrangements: Required when existing security interests need to be transferred or new security is being provided
2. Payment Terms: Include when specific payment arrangements between the original and new debtor need to be documented
3. Release of Original Debtor: Include when the original debtor is to be fully released from obligations
4. Conditions Precedent: Include when the assumption is subject to specific conditions being met
5. Regulatory Compliance: Required when the assumption needs specific regulatory approvals or notifications
6. Tax Provisions: Include when there are specific tax implications that need to be addressed
7. Information Rights: Include when ongoing information sharing between parties is required
8. Further Assurance: Include when additional actions may be needed to perfect the assumption
1. Schedule 1 - Details of Assumed Debt: Comprehensive details of the debt being assumed, including payment history and current status
2. Schedule 2 - Existing Security Interests: Details of any existing security interests related to the debt
3. Schedule 3 - Required Consents: List of all required consents and their status
4. Schedule 4 - Payment Schedule: If applicable, detailed schedule of future payments
5. Appendix A - Form of Notice: Template for formal notices to be used under the agreement
6. Appendix B - Form of Creditor's Consent: Standard form for documenting creditor's consent
Authors
Banking and Financial Services
Insurance
Real Estate
Manufacturing
Construction
Energy
Infrastructure
Telecommunications
Healthcare
Retail
Professional Services
Transportation and Logistics
Legal
Finance
Treasury
Corporate Development
Risk Management
Compliance
Corporate Secretariat
Credit
Mergers & Acquisitions
Business Development
Chief Financial Officer
Finance Director
Treasury Manager
Corporate Finance Manager
Legal Counsel
Corporate Lawyer
Risk Manager
Restructuring Officer
Financial Controller
Compliance Officer
Corporate Secretary
Credit Manager
Transaction Manager
Business Development Director
Mergers & Acquisitions Manager
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