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The Line of Credit Agreement serves as a crucial financing instrument in the German market, providing businesses and individuals with flexible access to credit up to a predetermined limit. This document is essential when parties wish to establish an ongoing borrowing relationship rather than a one-time loan. It details the terms under which the borrower can draw funds, the applicable interest rates, repayment obligations, and security arrangements. Governed by German law, particularly the Civil Code (BGB) and Banking Act (KWG), the agreement ensures compliance with strict German banking regulations and consumer protection requirements. It's commonly used for working capital financing, business expansion, or as a liquidity buffer, with variations possible depending on the borrower's status (consumer or business) and specific needs.

1. Parties: Identification of the lender (credit institution) and borrower with full legal names and addresses

2. Background: Context of the credit facility and purpose of the agreement

3. Definitions: Detailed definitions of terms used throughout the agreement, including banking and financial terms

4. Facility: Details of the credit line including amount, purpose, and availability period

5. Interest and Fees: Interest calculation method, rates, payment periods, and all applicable fees

6. Drawdown: Conditions and procedures for drawing down the credit line, including notice requirements

7. Repayment: Terms for repayment, minimum payments, and handling of excess drawings

8. Security: Basic security arrangements and guarantees required

9. Representations and Warranties: Standard declarations by the borrower about their legal and financial status

10. Borrower Covenants: Ongoing obligations of the borrower during the life of the facility

11. Events of Default: Circumstances constituting default and consequences

12. Bank's Rights and Obligations: Rights and duties of the lending institution

13. Data Protection: GDPR compliance and data handling provisions

14. Notices: Communication methods and contact details for formal notices

15. Governing Law and Jurisdiction: Confirmation of German law application and jurisdiction

16. Execution: Signature blocks and execution requirements