Document background
The Loan Extension Agreement is a critical document used when parties to an existing loan agreement wish to extend its maturity date rather than refinancing or entering into a new loan agreement. This document type is particularly relevant in the Danish market where it must comply with local financial regulations and the Danish Contracts Act. It's commonly used during economic fluctuations when borrowers require additional time for repayment, or when both parties prefer to maintain their existing relationship rather than refinancing. The agreement typically includes confirmation of the outstanding amount, revised repayment schedules, any modified terms for the extension period, and reaffirmation of existing security arrangements. It's essential for both financial institutions and corporate borrowers in Denmark, providing a streamlined approach to extending credit facilities while maintaining legal certainty.
