Loss Share Agreement Template for Belgium

Loss Share Agreements are crucial risk management tools in Belgian financial and commercial transactions, typically employed when parties seek to allocate and manage potential losses from specific business activities or investments. These agreements, governed by Belgian law and regulatory framework, are commonly used in portfolio transfers, asset sales, joint ventures, and financial restructurings. The Loss Share Agreement defines the scope of covered losses, calculation methodologies, and claim procedures, while ensuring compliance with Belgian banking regulations and financial services requirements. It's particularly relevant in scenarios involving asset transfers between financial institutions, risk-sharing arrangements in project finance, and structured financial transactions where multiple parties need to allocate potential losses according to predetermined ratios.

1. Parties: Identifies and defines the participating parties in the loss share agreement, including their legal status and contact details

2. Background: Provides context for the agreement, including the underlying transaction or relationship giving rise to potential losses

3. Definitions: Defines key terms used throughout the agreement, particularly technical and financial terms specific to loss sharing

4. Scope of Loss Sharing: Defines what types of losses are covered and excluded under the agreement

5. Loss Share Percentages: Specifies the proportion of losses to be borne by each party

6. Calculation of Losses: Details the methodology for calculating covered losses

7. Claims Procedure: Outlines the process for making and validating loss share claims

8. Payment Terms: Specifies timing, method, and currency of loss share payments

9. Representations and Warranties: Standard declarations by parties regarding their capacity and authority

10. Record Keeping and Audit Rights: Requirements for maintaining records and rights to audit loss calculations

11. Term and Termination: Duration of the agreement and circumstances allowing early termination

12. Confidentiality: Provisions regarding the treatment of confidential information

13. Governing Law and Jurisdiction: Specifies Belgian law as governing law and relevant jurisdiction for disputes

14. Notices: Procedures for formal communications between parties

15. General Provisions: Standard boilerplate clauses including assignment, amendments, and severability