Loan Modification Agreement for Switzerland

Loan Modification Agreement Template for Switzerland

This document is a Loan Modification Agreement governed by Swiss law, specifically the Swiss Code of Obligations (OR/CO) and related banking and financial regulations. It serves to amend and modify the terms of an existing loan agreement between the parties, which may include changes to payment terms, interest rates, security arrangements, or other key provisions. The agreement ensures compliance with Swiss legal requirements while maintaining the enforceability of the original loan agreement, incorporating necessary regulatory considerations and protecting the interests of all parties involved.

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What is a Loan Modification Agreement?

The Loan Modification Agreement is a crucial document used when parties to an existing loan agreement need to alter its terms while maintaining the fundamental lending relationship. This document type is particularly relevant in the Swiss legal context, where it must comply with the Swiss Code of Obligations and, where applicable, Swiss banking regulations and consumer protection laws. It's commonly used during financial restructuring, when borrowers face changed circumstances, or when market conditions necessitate loan term adjustments. The agreement typically includes specific modifications to terms such as interest rates, payment schedules, or security arrangements, while preserving other original loan terms. It's essential for both lenders and borrowers in Switzerland to document these changes formally to ensure legal certainty and regulatory compliance.

What sections should be included in a Loan Modification Agreement?

1. Parties: Identification of the lender and borrower, including their full legal names, addresses, and registration details if applicable

2. Background: Reference to the original loan agreement, its date, and key terms, and brief explanation of why modification is needed

3. Definitions: Key terms used in the modification agreement, including references to defined terms in the original agreement

4. Modification of Loan Terms: Specific changes to the original loan agreement, clearly stating both the original and new terms

5. Effective Date: When the modifications take effect and any conditions precedent

6. Confirmation of Other Terms: Confirmation that all other terms of the original loan agreement remain unchanged

7. Representations and Warranties: Updated confirmations from the borrower regarding their ability to perform under the modified terms

8. Governing Law and Jurisdiction: Confirmation of Swiss law as governing law and jurisdiction for disputes

9. Execution: Signature blocks for all parties

What sections are optional to include in a Loan Modification Agreement?

1. Security Amendments: Required if any existing security arrangements are being modified or new security is being added

2. Regulatory Compliance: Required if the modification triggers any regulatory requirements, especially for regulated financial institutions

3. Tax Provisions: Include if the modifications have specific tax implications that need to be addressed

4. Consent of Third Parties: Required if any guarantors, security providers or other third parties need to consent to the modifications

5. Financial Covenants: Include if financial covenants are being modified or new ones are being added

6. Fees and Expenses: Include if there are specific fees or expenses related to the modification

7. Notice Requirements: Include if there are changes to notice requirements or additional notification obligations

What schedules should be included in a Loan Modification Agreement?

1. Original Loan Agreement: Copy of the original loan agreement being modified

2. Modified Payment Schedule: New payment schedule reflecting any changes to amount, timing, or interest calculations

3. Modified Security Documents: If applicable, updated or new security documentation

4. Conditions Precedent Checklist: List of conditions that must be satisfied before modifications become effective

5. Required Consents: Copies of any third-party consents obtained for the modification

6. Amended Financial Covenants: Detailed calculations and requirements for any modified financial covenants

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Switzerland

Publisher

Genie AI

Document Type

Agreement Contract

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Financial Services

Banking

Real Estate

Construction

Manufacturing

Retail

Healthcare

Technology

Agriculture

Hospitality

Professional Services

Relevant Teams

Legal

Finance

Compliance

Risk Management

Treasury

Credit Administration

Corporate Banking

Loan Operations

Restructuring

Commercial Banking

Relevant Roles

Legal Counsel

Finance Director

Credit Manager

Relationship Manager

Compliance Officer

Risk Manager

Chief Financial Officer

Treasury Manager

Loan Officer

Corporate Banker

Contract Administrator

Legal Director

Banking Executive

Restructuring Manager

Credit Risk Analyst

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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