Document background
A Deed of Subordination is a critical document in complex financing structures where multiple creditors have claims against the same debtor. Under Hong Kong law, this deed formally establishes the hierarchy of debt and regulates the rights and obligations of different classes of creditors. It is commonly used in scenarios involving multiple layers of debt financing, corporate restructurings, or project finance transactions. The document typically includes detailed provisions on payment waterfall, restrictions on enforcement actions, turnover obligations, and protective mechanisms for senior debt priority. The deed must comply with Hong Kong's formal requirements for deed execution and registration, particularly under the Companies Ordinance and Conveyancing and Property Ordinance. It becomes especially relevant during refinancing, restructuring, or enforcement scenarios, providing clarity and certainty in creditor relationships.
