Novation Agreement

This Novation Agreement is between an original debtor, a creditor and a new debtor who agrees to assume the original debtor's obligations to the creditor. This agreement sets out the names and addresses of all parties, the amount of indebtedness and the name and date of the agreement which created the indebtedness (i.e. Loan Agreement). It also sets forth that the new debtor assumes all debt and that creditor agrees with the assumption of the agreement. It is imperative that this arrangement be clearly set out in writing. A well-written Novation Agreement will prove invaluable in the event of disagreements, misunderstandings or litigation between the parties surrounding payment of the debt. (continued ...)