Subordination Agreement Long Form

{{company_name}}

{{company_address}}

Phone: {{phone}} | Email: {{email}} | Web: {{website}}

Subordination Agreement Long Form

Subordination Agreement Long Form

{{company_name}}

{{company_address}}

P: {{phone}}

E: {{email}}

W: {{website}}

SUBORDINATION AGREEMENT

This SUBORDINATION AGREEMENT (this 'Agreement') is made and entered into as of this {{day}} day of {{month}}, {{year}}, by and among:

1. {{Subordinating_Creditor_Company_Name}}, a company duly incorporated under the laws of {{country}}, with its registered office at {{Subordinating_Creditor_Address}} (the 'Subordinating Creditor'); and

2. {{Senior_Creditor_Company_Name}}, a company duly incorporated under the laws of {{country}}, with its registered office at {{Senior_Creditor_Address}} (the 'Senior Creditor'); and

3. {{Debtor_Company_Name}}, a company duly incorporated under the laws of {{country}}, with its registered office at {{Debtor_Address}} (the 'Debtor').

Collectively referred to as the 'Parties'.

RECITALS

WHEREAS, the Debtor is indebted to the Subordinating Creditor in the original principal amount of {{currency_symbol}}{{subordinating_debt_amount}} (the 'Subordinated Debt'), evidenced by a loan agreement dated {{subordinating_loan_agreement_date}} (the 'Subordinated Loan Agreement');

WHEREAS, the Debtor is indebted to the Senior Creditor in the original principal amount of {{currency_symbol}}{{senior_debt_amount}} (the 'Senior Debt'), evidenced by a loan agreement dated {{senior_loan_agreement_date}} (the 'Senior Loan Agreement');

WHEREAS, the Senior Creditor is unwilling to provide or continue to provide the Senior Debt unless the Subordinating Creditor agrees to subordinate the Subordinated Debt to the Senior Debt;

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

AGREEMENT OF SUBORDINATION

1.1. The Subordinating Creditor hereby irrevocably and unconditionally subordinates the Subordinated Debt and all rights and remedies of the Subordinating Creditor with respect thereto, to the Senior Debt and all rights and remedies of the Senior Creditor with respect thereto.

1.2. This subordination shall extend to all principal, interest, fees, costs, expenses, and any other amounts now or hereafter owing under the Subordinated Debt.

1.3. Until the Senior Debt is paid in full, the Subordinating Creditor shall not be entitled to receive, accept, or demand any payment or performance by the Debtor on account of the Subordinated Debt, whether by way of principal, interest, fees, or otherwise.

PAYMENT AND REMEDIES

2.1. In the event of any insolvency, bankruptcy, liquidation, dissolution, or analogous proceedings involving the Debtor, or upon any default under the Senior Loan Agreement, the Senior Creditor shall be entitled to receive payment in full of the Senior Debt before the Subordinating Creditor receives any payment on account of the Subordinated Debt.

2.2. The Subordinating Creditor agrees that any payments or distributions received by it in contravention of this Agreement shall be held in trust for the benefit of the Senior Creditor and shall be immediately turned over to the Senior Creditor.

2.3. The Subordinating Creditor shall not, without the prior written consent of the Senior Creditor, commence or join in any action or proceeding against the Debtor to enforce the Subordinated Debt.

REPRESENTATIONS AND WARRANTIES OF SUBORDINATING CREDITOR

The Subordinating Creditor represents and warrants to the Senior Creditor that:

a. It is the sole legal and beneficial owner of the Subordinated Debt and has the full power and authority to enter into this Agreement.

b. The Subordinated Debt is free and clear of any liens, encumbrances, or claims, other than those created by the Subordinated Loan Agreement.

c. This Agreement constitutes a valid and binding obligation of the Subordinating Creditor, enforceable in accordance with its terms.

COVENANTS OF SUBORDINATING CREDITOR

The Subordinating Creditor covenants and agrees that, until the Senior Debt is paid in full:

a. It will not assign, transfer, or encumber the Subordinated Debt without the prior written consent of the Senior Creditor.

b. It will not take any action that would impair or adversely affect the priority of the Senior Debt.

c. It will promptly notify the Senior Creditor of any event of default under the Subordinated Loan Agreement.

GOVERNING LAW AND JURISDICTION

3.1. This Agreement shall be governed by and construed in accordance with the laws of {{country}}.

3.2. Any dispute arising out of or in connection with this Agreement, including any question regarding its existence, validity, or termination, shall be referred to and finally resolved by arbitration in {{city}}, {{country}}, in accordance with the rules of the {{arbitration_institution}}.

MISCELLANEOUS

4.1. This Agreement constitutes the entire agreement among the Parties with respect to the subject matter hereof and supersedes all prior agreements and understandings, whether written or oral.

4.2. No amendment, modification, or waiver of any provision of this Agreement shall be effective unless in writing and signed by all the Parties hereto.

4.3. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and assigns.

IN WITNESS WHEREOF

The Parties have executed this Subordination Agreement as of the date first above written.

_____________________________

By: {{Subordinating_Creditor_Authorized_Signatory_Name}}

Its: {{Subordinating_Creditor_Signatory_Title}}

For: {{Subordinating_Creditor_Company_Name}}

_____________________________

By: {{Senior_Creditor_Authorized_Signatory_Name}}

Its: {{Senior_Creditor_Signatory_Title}}

For: {{Senior_Creditor_Company_Name}}

_____________________________

By: {{Debtor_Authorized_Signatory_Name}}

Its: {{Debtor_Signatory_Title}}

For: {{Debtor_Company_Name}}