Document background
An Equity Commitment Letter is commonly used in Hong Kong's corporate finance landscape to provide certainty of funding in various transaction types, including acquisitions, investments, and project financing. This document is particularly important in deals where parties need assurance that equity funding will be available when required. The letter, governed by Hong Kong law, typically includes specific details about the commitment amount, funding conditions, timing, and mechanics of the equity injection. It is especially relevant in transactions involving private equity firms, special purpose vehicles (SPVs), or parent companies providing support to subsidiaries. The document's enforceability under Hong Kong law makes it a crucial tool for transaction security and often forms part of the broader transaction documentation package.
