Credit Waiver for Hong Kong

Credit Waiver Template for Hong Kong

A Credit Waiver agreement under Hong Kong law is a formal document that temporarily or permanently waives specific requirements, obligations, or conditions under an existing credit facility or loan agreement. The document operates within Hong Kong's robust financial regulatory framework, incorporating requirements from the Banking Ordinance and HKMA guidelines. It details the specific provisions being waived, any conditions attached to the waiver, continuing obligations, and the impact on existing security arrangements, while ensuring compliance with Hong Kong's contractual and financial services laws.

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What is a Credit Waiver?

The Credit Waiver agreement is a crucial document used in Hong Kong's financial sector when a borrower requires relief from specific obligations under an existing credit facility. This document becomes necessary when circumstances warrant a modification of original credit terms without completely restructuring the facility. The Credit Waiver typically addresses temporary financial constraints, technical breaches, or changed business circumstances that affect compliance with original facility terms. It must comply with Hong Kong banking regulations and HKMA requirements, particularly regarding credit risk management and proper documentation of modifications to credit arrangements. The document serves to formally document the waiver while preserving the lender's rights and maintaining the overall integrity of the credit relationship.

What sections should be included in a Credit Waiver?

1. Parties: Identification of the lender/creditor and borrower/debtor

2. Background: Details of the original facility/credit agreement and circumstances leading to the waiver

3. Definitions: Definitions of key terms used in the waiver agreement, including reference to defined terms in the original facility agreement

4. Waiver: Specific details of the provisions being waived and the extent of the waiver

5. Conditions Precedent: Conditions that must be satisfied before the waiver becomes effective

6. Representations and Warranties: Confirmation of continuing accuracy of original representations and any new representations

7. Continuing Obligations: Confirmation that all other terms of the original agreement remain in force

8. Fees and Expenses: Any fees payable for the waiver and responsibility for costs

9. Governing Law and Jurisdiction: Confirmation of Hong Kong law as governing law and jurisdiction for disputes

What sections are optional to include in a Credit Waiver?

1. Security Confirmation: Required when existing security arrangements need to be confirmed as continuing and unaffected by the waiver

2. Additional Covenants: Include when new undertakings are required as a condition of granting the waiver

3. Guarantor Consent: Required when the original facility has guarantors who need to consent to the waiver

4. Conditions Subsequent: Include when there are actions that must be completed after the waiver becomes effective

5. Amendments: Required when other provisions of the original agreement need to be modified in connection with the waiver

6. Release and Waiver: Include when mutual releases or waivers of claims are part of the arrangement

What schedules should be included in a Credit Waiver?

1. Original Facility Agreement: Copy or details of the agreement being waived

2. Conditions Precedent: Detailed list of conditions and required documents

3. Form of Effective Date Certificate: Template certificate confirming satisfaction of conditions precedent

4. Security Documents: List of existing security documents affected by the waiver

5. Fee Schedule: Details of any fees payable in connection with the waiver

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

Hong Kong

Publisher

Genie AI

Document Type

Confirmation Letter

Sector

Sales

Cost

Free to use
Relevant legal definitions
Relevant Industries

Banking

Financial Services

Real Estate

Manufacturing

Trading

Retail

Construction

Infrastructure

Technology

Healthcare

Hospitality

Logistics

Mining

Energy

Relevant Teams

Legal

Finance

Treasury

Credit Risk

Compliance

Corporate Banking

Loan Operations

Credit Administration

Risk Management

Company Secretarial

Relevant Roles

Chief Financial Officer

Finance Director

Treasury Manager

Credit Risk Manager

Relationship Manager

Legal Counsel

Compliance Officer

Corporate Secretary

Risk Officer

Banking Manager

Credit Analysis Manager

Loan Operations Manager

Corporate Banking Director

Restructuring Manager

Industries
Teams

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