This forbearance agreement template has 7 pages and is a MS Word file type listed under our business plan kit documents.
Sample of our forbearance agreement template:
FORBEARANCE AGREEMENT This Forbearance Agreement (the "Agreement") is effective [DATE], BETWEEN: [NAME OF THE LENDER] (the "Lender"), a corporation organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] AND: [NAME OF THE BORROWER] (the "Borrower "), an individual with his main address located at OR a corporation organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] WHEREAS the Lender has made a loan to the Borrower in the original principal amount of [LOAN AMOUNT] (the "Loan") pursuant to that certain Loan Agreement, by and between the Lender and the Borrower, dated as of [MONTH] [DAY], [YEAR] (the "Loan Agreement") and certain related agreements, as the same may have been or may be further amended, modified, supplemented, extended, renewed, restated, or replaced (collectively, the "Loan Documents"). All capitalized terms not defined herein shall have the meanings ascribed to them in the Loan Documents. WHEREAS, the Loan is secured by that certain [NAME OF MORTGAGE/DEED OF TRUST OR OTHER SECURITY INSTRUMENT] covering certain real property owned by the Borrower as more specifically set forth in the Loan Documents. WHEREAS, Events of Default under the Loan Documents have occurred, specifically [DEFAULTS] ("Existing Defaults"). Pursuant to the terms of the Loan Documents, all obligations of the Borrower to the Lender under the Loan Documents can now be declared by the Lender to be immediately due and payable. The Borrower has requested that the Lender forbear from exercising its rights and remedies under the Existing Defaults, and the Lender has agreed to do so, subject to the terms and conditions set forth herein. NOW THEREFORE, for good and valuable consideration, set forth herein, the Lender, the Borrower, and each Guarantor agree as follows: RECITALS AND PERIOD OF FORBEARANCE The recitals to this Agreement are incorporated into this Agreement as if fully set forth herein. Upon satisfaction of the conditions set forth in this Agreement, the Lender shall forbear (the "Forbearance") from exercising its rights and remedies under the Loan Documents arising from the Existing Default for the Forbearance Period (as defined in Section 3.2). ACKNOWLEDGEMENTS The Borrower hereby agrees that as of [DATE], the Borrower is indebted to the Lender under the Loan Documents in the amount of [AMOUNT OWED]. All such amounts and all hereafter accruing principal, fees, and interest are unconditionally owed by the Borrower to the Lender without offset, defence, or counterclaim of any nature. The Borrower hereby agrees that (i) each of the Loan Documents has been duly executed and shall remain in full force and effect as of the Effective Date of this Agreement, except as expressly modified herein; (ii) the agreements and obligations of the Borrower contained in the Loan Documents and this Agreement are valid and binding, enforceable against the Borrower in accordance with the terms of the Loan Documents and Agreement; (iii) the Borrower has no valid defence to the enforcement of the Borrower's obligations under the Loan Documents and this Agreement; and (iv) the Lender is and shall be entitled to the rights and remedies provided for under the Loan Documents, this Agreement and applicable law. [Each Guarantor hereby agrees that (i) each of the Guaranty Documents has been duly executed and shall remain in full force and effect as of the Effective Date of this Agreement, except as expressly modified herein; (ii) the agreements and obligations of the Guarantor contained in the Guaranty Documents and this Agreement are valid and binding, enforceable against the Guarantor in accordance with the terms of the Guaranty Documents and this Agreement; (iii) the Guarantor has no valid defence to the enforcement of the Guarantor's obligations under the Guaranty Documents and this Agreement; and (iv) the Lender is and shall be entitled to the rights and remedies provided for under the Guaranty Documents, this Agreement and applicable law.] FORBEARANCE IN RESPECT OF EXISTING DEFAULTS The Borrower hereby acknowledges and agrees that the Existing Defaults have occurred and are continuing, each of which constitutes an Event of Default and entitles the Lender to exercise its rights and remedies under the Loan Documents and applicable law. The Borrower represents and warrants that, as of the Effective Date, no other Events of Default exist other than the Existing Defaults. The Borrower hereby acknowledges and agrees that the Lender is entitled under the terms of the Loan Documents to, among other remedies, declare the Borrower's obligations under the Loan Documents to be immediately due and payable. Forbearance: In reliance upon the representations, recitals, warranties, and covenants of the Borrower made in this Agreement, and subject to the terms and conditions of this Agreement and any documents or instruments executed in connection with this Agreement, the Lender agrees to forbear from exercising its rights and remedies under the Loan Documents or applicable law arising out of the Existing Defaults, for the period (the "Forbearance Period") commencing on the Effective Date and ending on the date which is the earlier of (a) [MONTH] [DAY], [YEAR], or (b) the occurrence or existence of any Event of Default, other than any Existing Default. Upon the termination of the Forbearance Period, the agreement of the Lender to forbear shall automatically and without further action terminate and be of no force and effect, it being expressly agreed that the effect of such termination will be to permit the Lender to exercise immediately all rights and remedies under the Loan Documents and applicable law, including, but not limited to, (a) ceasing to make any further Loans, and (b) accelerating all of the obligations of the Borrower under the Loan Documents; in each case without any further notice to the Borrower or forbearance of any kind. The Parties to this Agreement acknowledge and agree that any misrepresentation by the Borrower or the Guarantor (hereinafter referred to as "the Borrowing Parties" for this section 3.2.3) or any failure of the Borrowing Parties to comply with the covenants, conditions and agreements contained in this Agreement, the Loan Documents [the Guaranty Documents] or any other agreement, document or instrument at any time executed and/or delivered by the Borrowing Parties with, to or in favour of the Lender shall constitute an Event of Default under this Agreement and the Loan Documents. No Other Waivers; Reservation of Rights: The Lender has not waived, and is not by this Agreement waiving, any Existing Defaults or any Events of Default which may occur after the Effective Date, and the Lender has not agreed to forbear with respect to any of its rights and remedies concerning any Event of Default, except for Existing Defaults as set forth in this Agreement. Subject to Section 3 herein, the Lender reserves the right, in its discretion, to exercise any or all of its rights and remedies under the Loan Documents as a result of any other Events of Default occurring at any time. The Lender has not waived any such rights and remedies, and nothing in this Agreement, and no delay on its part in exercising such rights or remedies, shall be construed as a waiver of such rights and remedies. REPRESENTATIONS AND WARRANTIES OF BORROWER The Borrower hereby represents, warrants, and covenants as follows:
