Document background
The Subordinated Promissory Note is commonly used in Hong Kong for structured financing arrangements where parties wish to establish a clear hierarchy of debt obligations. It serves as a formal acknowledgment of debt while explicitly recognizing the superior payment rights of senior creditors. This document type is particularly useful in corporate financing, investment structures, and complex lending arrangements where multiple layers of debt exist. The note must comply with Hong Kong's Bills of Exchange Ordinance and related financial regulations, making it suitable for both corporate and sophisticated individual transactions. It typically includes detailed provisions on payment terms, interest calculations, subordination mechanisms, and enforcement rights, providing clarity on the parties' respective positions in the creditor hierarchy.
