Waiver And Amendment Agreement

The starting point for understanding how a provision of an agreement can be amended or repealed should always be to review its terms and conditions. A well-developed document establishes that amendments or derogations are only effective if they have been written down and signed or approved by the parties involved. In the event of a waiver, it is generally only necessary for the party who is asked to waive his right of consent to that waiver. Similarly, an amendment clause may provide that only certain parts of the document must accept a particular change. In all cases, it is important to ensure that the specified conditions are strictly respected. The effects of the pandemic on the ability to meet contractual obligations may require a change in agreements or counterparties that wish to temporarily waive obligations that would otherwise be breached. This cautionary reviews the issues that parties to the trade documentation should consider when trying to find solutions to these business problems. First, we look at some general principles regarding the modification of English legal documentation and the granting of exemptions, before considering some typical commercial financing documents. Amendments and exceptions are far from simple and can be a trap for the unwary.

This is particularly the case where the requested amendment or exemption occurs in difficult circumstances such as the current pandemic, where each day may result in new developments that may affect the proposed amendment or exemption. Where there are two or more debtors of a facility agreement, it is customary, for commercial reasons, for a debtor to serve as an agent to all debtors. The relevant provisions of the appointment must be reviewed to determine whether this role is merely an administrative task or whether the designated debtor is entitled to agree changes on behalf of other debtors. Even if such authority exists, it may be necessary or desirable to obtain explicit consent from all affected debtors to certain amendments or exceptions.

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