Paid In Full Agreement Template for Hong Kong

The Paid In Full Agreement is a crucial document used in Hong Kong business and financial transactions to formally document the complete settlement of outstanding debts. This agreement is typically employed when a creditor agrees to accept a final payment (whether in full or at a discount) to settle an outstanding obligation. The document serves multiple purposes: it confirms receipt of the agreed settlement amount, provides legal certainty by releasing the debtor from further claims, and helps prevent future disputes about the debt's status. Under Hong Kong law, this agreement must clearly specify the original debt, settlement amount, payment terms, and include comprehensive release provisions. It's particularly valuable in commercial debt settlements, loan closures, and dispute resolutions where parties seek to achieve finality in their financial obligations.

1. Parties: Identifies the creditor and debtor with their full legal names and addresses

2. Background: Outlines the history of the debt, original agreement details, and current outstanding amount

3. Definitions: Defines key terms used in the agreement including 'Original Debt', 'Settlement Amount', and 'Settlement Date'

4. Settlement Amount: Specifies the agreed-upon settlement amount and confirms it as full satisfaction of the debt

5. Payment Terms: Details the payment method, timing, and confirmation of receipt

6. Release and Discharge: Provides for full release of the debtor from all claims related to the original debt upon payment

7. Full and Final Settlement: Confirms that the payment represents a complete settlement of all claims

8. Representations and Warranties: Contains basic warranties about the parties' authority to enter into the agreement

9. Governing Law and Jurisdiction: Specifies Hong Kong law as governing law and Hong Kong courts' jurisdiction

10. Execution: Signature blocks and execution details