Intercompany loan agreement template, A loan agreement is the document which represents the formal evidence of financing. The document also includes important details such as covenants, positive or negative ones, the data on the collateral such as loan type and its value, as well as guarantees, the applicable rates of interest, fees, the terms according to which the loan is to be repaid, and the period of repayment envisaged.
In conclusion, the loan agreement contains the terms and the conditions that are pointed out so that the borrower may draw out a loan. The terms and conditions are determined by the lender, which can be a bank, or another sort of financial institution. In actuality, the loan represents a sort of”facility” that is given by the lender, and that is why the agreement on the terms under which a loan can be taken out is also referred to as a facility agreement. The arrangement comprises four sections.
The first section comprises the terms that should be used in the document and their definitions.
The second section is concerned with the operational terms relevant to the agreement, meaning it points out the amount to be borrowed, the program of its repayment, and the interest on the repayment. The second section of this loan agreement is of special interest for the fiscal agents of the borrower.
The next section is devoted to the specifics of the loan transaction; it comprises the responsibilities of the borrower and the lender, the measures to be undertaken in the event of the borrower’s inability to repay the loan; there is also information on the extent to which changes can be made to the agreement. The next section is drawn up after detailed negotiations between the lender and the borrower.
The final fourth sections contains standard text including details like contract data, the relationships which exist between the finance parties – in the event of more than one tender and more than one law that apply to the arrangement. Check it out the sample of intercompany loan agreement template below at the attachment page.