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Loss Share Agreement
"I need a Loss Share Agreement between ABC Bank Limited and XYZ Investment Fund for a commercial property portfolio valued at NZD 50 million, with a 70-30 loss sharing ratio and quarterly loss assessments starting from March 2025."
1. Parties: Identifies and defines all parties to the agreement, including their legal status and contact details
2. Background: Sets out the context and purpose of the loss sharing arrangement, including any relevant historical or business context
3. Definitions and Interpretation: Defines key terms used throughout the agreement and establishes interpretation rules
4. Scope of Loss Sharing: Defines what constitutes a covered loss and the specific assets or portfolio subject to the agreement
5. Loss Calculation Methodology: Details how losses will be calculated, including timing and verification procedures
6. Payment Terms: Specifies the mechanism for loss payments, including timing, currency, and payment procedures
7. Rights and Obligations: Sets out the specific responsibilities and rights of each party under the agreement
8. Representations and Warranties: Contains standard and specific representations and warranties from all parties
9. Record Keeping and Reporting: Establishes requirements for maintaining records and reporting loss-related information
10. Term and Termination: Specifies the duration of the agreement and circumstances for early termination
11. Confidentiality: Establishes confidentiality obligations regarding shared information and agreement terms
12. Dispute Resolution: Sets out procedures for resolving disputes between parties
13. General Provisions: Contains standard boilerplate clauses including notices, amendments, and governing law
1. Security Arrangements: Used when collateral or security is required to support loss sharing obligations
2. Third Party Rights: Include when third parties may have rights or obligations under the agreement
3. Recovery Procedures: Required when parties want to specify procedures for recovering shared losses from third parties
4. Step-In Rights: Include when one party needs the right to take over certain operations in specific circumstances
5. Insurance Requirements: Used when specific insurance coverage is required as part of the risk management structure
6. Portfolio Management: Include when the agreement covers an ongoing portfolio requiring active management
7. Regulatory Compliance: Required when specific regulatory requirements need to be addressed
8. Tax Provisions: Include when specific tax implications need to be addressed in the loss sharing arrangement
1. Schedule 1 - Covered Assets/Portfolio: Detailed list and description of assets or portfolio subject to loss sharing
2. Schedule 2 - Loss Calculation Examples: Worked examples showing how losses will be calculated in various scenarios
3. Schedule 3 - Payment Procedures: Detailed procedures for making and receiving loss share payments
4. Schedule 4 - Reporting Templates: Standard forms and templates for required reporting under the agreement
5. Schedule 5 - Loss Verification Procedures: Detailed procedures for verifying and documenting losses
6. Schedule 6 - Contact Details: List of key contacts and notice details for all parties
7. Appendix A - Excluded Losses: Detailed description of losses specifically excluded from the agreement
8. Appendix B - Required Documentation: List of documents required for loss claims and verification
Authors
Banking
Financial Services
Insurance
Investment Management
Real Estate
Private Equity
Asset Management
Government and Public Sector
Corporate Finance
Risk Management
Legal
Risk Management
Finance
Compliance
Treasury
Operations
Portfolio Management
Investment
Due Diligence
Asset Management
Chief Risk Officer
Chief Financial Officer
Legal Counsel
Risk Manager
Portfolio Manager
Compliance Officer
Financial Controller
Treasury Manager
Investment Manager
Operations Director
Contract Manager
Business Development Manager
Due Diligence Officer
Asset Manager
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