Changes to terms for existing loans

If your company needs a payment deferral, there are three options:

• If you need a short-term payment deferral, we can grant a deferral of up to three months from the due date of the oldest unpaid instalment. Applications for payment deferrals are processed automatically via My page. Please note that late-payment interest will accrue until the instalment has been paid. You can only use this option once per loan.
• If you need to defer payment for between three and six months, please contact your customer advisor. Please note that late payment interest will accrue until the instalment has been paid.
• If you need to defer repayments, you can apply via My page. Your company must be up to date with interest and charges before you submit your application. You must continue to pay interest and charges throughout the repayment deferral period. As a general rule, we will extend the loan term by the length of the repayment deferral period, unless we determine that the term cannot be extended. In that case, we will distribute the amount across the remaining instalments. If you do not want to extend the loan term, you must state this in your application. 
• Interest capitalisation means that accrued interest is added to the loan principal. We only approve interest capitalisation in exceptional cases where payment difficulties are expected to be temporary and the accrued interest is covered by the existing collateral. You must sign a new promissory note. As a general rule, we require other creditors to grant equivalent terms. If you need interest capitalisation, please contact your regional Innovation Norway office.

Any change to the collateral is subject to the loan being serviced in accordance with the repayment schedule.

Subordination of priority. We may subordinate our priority over pledged assets in favour of another lender. We are reluctant to subordinate our priority over operating assets, while subordination of priority over inventory, receivables and agricultural movable property in favour of a bank providing an operating credit facility may be easier to approve. When applying for subordination of priority over real property or vessels, you must attach an up-to-date valuation. 

Please note that we do not agree to subordinate our security interest if the purpose is to secure existing loans from other lenders, construction loans or other short-term loans.

Submit your application for a change in priority through My Page. Log in to My Page, select the relevant organisation and go to Online Banking. Select ‘Apply for a change’ from the drop-down menu, then select Change in priority.

For subordination of priority and recognition of leasehold rights in agriculture, you must also use this form.

Log in to My page

Release of collateral. As a general rule, for us to approve the release of collateral, we must be offered alternative security that we consider satisfactory, or the loan must be reduced by an amount equivalent to the value of the collateral being released.

If the release of security is due to the secured asset being sold, the sale proceeds must generally be used to reduce the secured debt. If parts of a secured asset are to be released from the security, you must obtain our consent. This applies, for example, to the sale of a machine that constitutes a significant part of the security. In such cases, unless the asset is replaced by a new asset of equivalent value, we may require the loan to be reduced or secured by new collateral or a guarantee. You must submit the application form via My Page.
Log in to My Page, select the relevant entity and go to Online Banking. Select 'Apply for a change' from the drop-down menu, then select 'Release of security'.

Release from a guarantee generally requires the guarantor to be replaced by a new guarantor acceptable to us. Alternatively, other satisfactory security may be provided. You must apply for release from a guarantee through My Page. Log in to My Page, select the relevant entity, go to Online Banking and select ‘Change of terms’.

In connection with a merger or demerger, we will assess, among other things, whether the collateral securing our loan is sufficient or whether additional security will be required.

The company must be up to date with interest payments, instalments and costs.

For consent to a merger or demerger, you must contact your regional Innovation Norway office.

Please use this form

If the debtor plans any material changes that affect its engagement with us, we must give our consent before the changes are implemented.

This applies to:

• Significant changes to the investment plan 
• Changes that will result in non-compliance with, or breach of, terms and conditions
• Change of ownership
• Relocation of the borrower’s/pledgor’s business – in whole or in part.

You must submit your application to change the terms and conditions via My Page.
Log in, select the relevant entity and go to Online Banking. Click ‘Apply for a change’ in the drop-down menu and select ‘Change to loan/grant terms and conditions’.

Log in to My Page

You must also inform us of any change of name (where the organisation number remains unchanged) or address. In such cases, simply email kundesupport@innovasjonnorge.no to let us know about the change.

A loan is in default

• if payment is not made (in full or in part) by the due date. Default interest in accordance with the loan agreement will accrue from this date. 
• in the event of failure to comply with, or breach of, the terms or conditions of the loan under the agreement and/or security documents.
• if the assets pledged as security are not insured, unless otherwise agreed with Innovation Norway. Failure to maintain insurance constitutes a material breach.

If the breach is material, we may terminate the loan agreement with immediate effect.

Get in touch with your customer advisor to discuss possible solutions. Please note that if the loan has been referred for debt collection, you should contact the debt collection agency, not Innovation Norway.

Our position in principle on debt forgiveness in connection with out-of-court proceedings:

1.1 Introductory remarks

Innovation Norway’s (‘IN’) objective when forgiving debt is to safeguard our interests as a creditor as effectively as possible and ensure compliance with State aid rules.

For us to consider debt forgiveness, the company’s total debt must be of a certain size. 

Please note: If we consider the payment difficulties to be temporary, easing the payment terms (such as deferring instalments or extending the repayment period) will normally be sufficient. In such cases, we will not normally participate in a debt settlement. Changes to payment terms are not available for Startup Loans, as this is a standard scheme with fixed terms.

1.2 Further details on court-supervised restructuring

The court-supervised restructuring process for companies that are experiencing or expect to experience financial difficulties provides effective mechanisms for companies with excessive debt. As a general rule, we recommend using this process unless the statutory procedure is considered too time-consuming and/or complex, or other exceptional circumstances apply.

1.3 Important: Winding up companies

Where there are no plans to continue operating the company and it is due to be wound up, we cannot agree to an out-of-court debt waiver. In such cases, the debt owed to us must either be repaid in full or the company must file for bankruptcy. 

2. General requirements for out-of-court processes 

2.1 Terminology

Hereafter, ‘restructuring’ refers to processes governed by the Restructuring Act. ‘Out-of-court debt negotiations’, or simply ‘debt negotiations’, refers to processes that are not supervised by the district court and aim to restructure the borrower’s debt obligations to enable future operations.

2.2 External assistance

Our experience shows that borrowers benefit greatly from the support of an experienced and competent advisor during the process, preferably a lawyer or auditor. We therefore require the company to engage an external advisor unless its financial position and debts are very straightforward. We reserve the right not to participate in processes that are not progressing as required or that appear disorganised or unclear. 

2.3 General principles

2.3.1 Equal treatment

The process must follow the general principles of equal treatment and transparency. We will not participate in debt negotiations that contravene the principles of the Bankruptcy Act, the Creditors Recovery Act and the Restructuring Act. We will only accept solutions that, in our assessment, will deliver a better financial outcome for us than bankruptcy.

2.3.2 Going concern assumption

If we are to forgive debt, the company must continue operating after the debt restructuring. This is an absolute requirement. The company must therefore demonstrate that it is likely to operate profitably once the process has been completed. For companies that are ‘a long way’ from generating commercial revenue, including typical ‘development companies’, this will generally mean that we cannot agree to debt forgiveness. 

For us to have confidence in the company's future operations, you must provide substantiated operating and cash flow budgets, as well as a balance sheet showing the company's financing structure after restructuring. Please note that the documentation must show that the new equity is sufficient to cover operating costs during the debt negotiation phase, dividends to creditors and the funding required until the company becomes profitable, either on its own or together with new credit or other financing.

2.3.3 Loss of share capital 

For limited companies, the entire share capital will have been lost in circumstances where debt forgiveness is being considered. The share capital must therefore be written down to zero and new share capital injected.

3. Requirements for applications for debt forgiveness 

To enable us to assess the company’s difficult financial situation and consider whether to forgive the debt, you must provide the following information:

3.1 Description of the situation – measures 

• A description of the causes of the financial difficulties, including a brief review of the company's financial decisions over the past three months.
• Complete annual financial statements, or preliminary annual financial statements if applicable.
• Updated interim financial statements, including a balance sheet.
• Substantiated budgets, including a cash flow budget, for the next three years. 
• An overall plan for the debt negotiation period – with information on both operational and financial measures, including a description of how operations will be financed during the debt negotiation period and whether payments have been suspended (possibly to a limited extent to avoid bankruptcy petitions or disruption to operations). 

3.2 Assets and liabilities

• An overview of outstanding debt at a specific point in time (the cut-off date), broken down into unsecured and secured debt (including debt secured by an attachment lien) and itemised by creditor. A broad distinction must be made between trade payables, financial creditors, public-sector creditors, and debt owed to owners or group companies. 
• An overview of any guarantees (including third-party security). 
• The assets must be assigned an objective value based on the business continuing as a going concern. As a general rule, this means that the valuation must be carried out by an independent third party. The creditors must approve the valuation.
• Where the value of pledged assets is lower than the amount of the secured loan(s), only the portion of the secured loan(s) that falls within the approved valuation may be excluded from the debt restructuring arrangement. Any portion of the secured loan(s) exceeding this value will be included in the debt restructuring arrangement and treated in the same way as other unsecured debt.
• The purpose of a debt restructuring arrangement is to reduce the company's debt to a manageable level. It is therefore assumed that the portion of the company's debt secured by guarantees, third-party guarantees or third-party collateral will be settled by the guarantor(s) or third-party guarantor(s).
• We are generally willing to continue the secured portion of mortgage loans not covered by the debt restructuring arrangement. 

3.3 Dividend calculation

• Preferential debt under the system set out in the Creditors Recovery Act (see Chapter 9 of the Act) is assumed to be paid in full.
• Secured debt exceeding the value of the collateral is considered unsecured debt and must be treated in the same way as other unsecured debt. A dividend must be offered on the unsecured debt. The size of the dividend depends on several factors that may vary from case to case. We require a dividend of at least 15%, payable without undue delay. Our decision to waive the debt will not take effect until the dividend has been received in our account. (Dividend claims cannot be converted into loans).
• It is essential that all unsecured debt is treated equally. However, in line with standard practice, we may accept solutions where ‘small claims’ of less than NOK 5,000–10,000 are excluded from the debt settlement. In such cases, all unsecured creditors must receive the same cash payment before the dividend is calculated on the remaining amount.

4. Concluding remarks

The aim of debt negotiations is to find a sustainable solution that enables the company to continue operating, create value and face the future with a financial buffer against unforeseen events. At the same time, creditors’ interests must be protected as far as possible.