The financing and debt restructuring agreement is a legal process which allows a public or a private company under debt to re-instate the debt structure. As per this agreement the debtor facing financial distress and financial problems can restructure their debt agreement by modifying the terms of the agreement. This helps the debtor to become able to pay back the loan. This is also beneficial for the financing institution.
This is done to restore or enhance the liquidity of debt, and the debtor becomes able to resurface with new modified terms and conditions of the debt agreement. This process is far better and cost effective than the other alternative which is bankruptcy. The only issues involved in finance and debt restructuring are the effort and time involved in negotiating with the lending party. This process results in an extension of loan payment terms and duration.
[Also Read: Debt Restructuring Letter Agreement]
Sample for Financing and Debt Restructuring Agreements
A sample of the agreement can be downloaded from below.
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