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Deed Of Subordination
"I need a Deed of Subordination to establish priority between a $10M senior bank loan and a $2M shareholder loan for our Singapore manufacturing company, with the shareholder agreeing to fully subordinate their debt until the bank loan is repaid."
1. Parties: Identifies all parties to the deed, including senior and junior creditors, and the debtor
2. Background: Sets out the context of existing debts and reason for subordination
3. Definitions: Defines key terms used throughout the deed including Senior Debt, Subordinated Debt, and Enforcement Action
4. Subordination Provisions: Core terms establishing the ranking of debts and subordination mechanics
5. Undertakings: Commitments by parties regarding the subordinated debt and restrictions on payments
6. Duration: Period for which subordination remains effective and termination provisions
7. Execution: Formal execution blocks for all parties including attestation requirements
1. Security Provisions: Details of any security arrangements and their priority ranking
2. Turnover Provisions: Provisions for handling unauthorized payments received by junior creditors
3. Further Assurance: Obligation to take additional steps if needed to give effect to the subordination
1. Schedule 1 - Details of Senior Debt: Comprehensive list of senior debt facilities and amounts
2. Schedule 2 - Details of Subordinated Debt: Comprehensive list of subordinated debt facilities and amounts
3. Schedule 3 - Form of Accession Deed: Template for additional parties to join the subordination arrangement
4. Schedule 4 - Notice Provisions: Contact details and methods for serving notices between parties
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