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Release Of Debt Agreement Template for Hong Kong

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Key Requirements PROMPT example:

Release Of Debt Agreement

"I need a Release of Debt Agreement under Hong Kong law to discharge a corporate debt of HKD 500,000 owed by my technology company to a supplier, with the release to be effective from March 1, 2025, in exchange for a one-time settlement payment of HKD 350,000."

Document background
A Release of Debt Agreement is a crucial legal document used in Hong Kong when a creditor wishes to formally and legally discharge a debtor from their obligation to pay a debt. This document is particularly relevant in situations involving debt settlements, corporate restructuring, or family arrangements. The agreement must comply with Hong Kong contract law requirements and typically includes details of the original debt, confirmation of the release, and any conditions attached to the release. The Release of Debt Agreement serves as conclusive evidence that the debt has been discharged and protects both parties from future claims or disputes. It's essential in Hong Kong's business environment where clear documentation of debt discharge is crucial for maintaining accurate financial records and preventing future disputes.
Suggested Sections

1. Parties: Identifies and defines the Creditor and Debtor, including full legal names and addresses

2. Background: Recites the existence of the debt, its origin, and the parties' intention to release it

3. Definitions and Interpretation: Defines key terms used in the agreement and sets out interpretation rules

4. Acknowledgment of Debt: Confirms the original debt amount and details of any payments made

5. Release: Contains the operative provisions releasing the debt and the terms of the release

6. Warranties and Representations: Contains warranties from both parties about their capacity and authority to enter into the agreement

7. Further Assurance: Obligation to execute further documents if needed to give effect to the release

8. Governing Law and Jurisdiction: Specifies Hong Kong law as governing law and Hong Kong courts' jurisdiction

9. Execution: Signature blocks and execution formalities

Optional Sections

1. Partial Release: Used when only part of the debt is being released, specifying the remaining obligations

2. Conditions Precedent: Include when the release is conditional upon certain events or actions

3. Confidentiality: Include when parties wish to keep the release terms confidential

4. Tax Implications: Include when there are specific tax consequences that need to be addressed

5. Multiple Creditors: Include when there are multiple creditors releasing the debt

6. Release of Security: Include when there is security over assets that needs to be released

7. Severability: Optional clause protecting the agreement if certain provisions are found invalid

Suggested Schedules

1. Schedule 1 - Details of the Original Debt: Details of the original debt agreement, including date, amount, and any relevant terms

2. Schedule 2 - Payment History: Record of any payments made against the debt (if applicable)

3. Schedule 3 - Security Documents: List of any security documents to be released (if applicable)

4. Appendix A - Copy of Original Debt Agreement: Copy of the original agreement creating the debt

5. Appendix B - Related Correspondence: Copies of relevant correspondence regarding the debt and its release

Authors

Alex Denne

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

Relevant legal definitions


























Clauses




















Relevant Industries

Banking & Financial Services

Real Estate

Manufacturing

Retail

Construction

Professional Services

Technology

Import/Export

Healthcare

Education

Hospitality

Logistics

Small and Medium Enterprises

Relevant Teams

Legal

Finance

Accounts Receivable

Treasury

Credit Control

Risk Management

Compliance

Corporate Secretarial

Debt Collection

Business Development

Relevant Roles

Chief Financial Officer

Financial Controller

Credit Manager

Accounts Receivable Manager

Legal Counsel

Company Secretary

Finance Director

Treasury Manager

Debt Collection Officer

Risk Manager

Compliance Officer

Corporate Lawyer

Accountant

Financial Analyst

Business Development Manager

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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