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Loan Extension Agreement for Indonesia

Loan Extension Agreement Template for Indonesia

A Loan Extension Agreement under Indonesian law is a formal legal document that modifies an existing loan agreement by extending its maturity date and potentially adjusting other terms. The agreement must comply with Indonesian Civil Code (KUH Perdata) requirements and relevant banking regulations, particularly those issued by Bank Indonesia and the Financial Services Authority (OJK). It documents the parties' agreement to extend the loan period, confirms the outstanding amount, and specifies any modified terms while ensuring all other original loan conditions remain effective. The document typically requires proper execution before a notary public and must be drafted in both Indonesian and English languages if involving foreign parties.

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What is a Loan Extension Agreement?

The Loan Extension Agreement is a critical document used when parties to an existing loan arrangement wish to extend the loan's maturity date rather than refinancing or entering into a new loan agreement. This document type is particularly relevant in the Indonesian market where loan extensions are common practice for managing ongoing financing relationships. The agreement must conform to Indonesian banking regulations and civil law requirements, including specific provisions of the Indonesian Civil Code (KUH Perdata) and OJK regulations. It typically includes confirmation of outstanding amounts, any revised terms, and conditions precedent to the extension becoming effective. The document is especially important during periods of economic uncertainty or when borrowers require additional time to meet their repayment obligations. For validity under Indonesian law, the Loan Extension Agreement often requires notarization and, where applicable, must be drafted bilingually in Indonesian and English.

What sections should be included in a Loan Extension Agreement?

1. Parties: Identifies the lender and borrower with their complete legal names, registration numbers, addresses, and authorized representatives

2. Background: Recitals explaining the original loan agreement details, reason for extension, and current status of the loan

3. Definitions: Defines key terms used in the agreement, including references to defined terms in the original loan agreement

4. Extension of Loan Term: Clearly states the new maturity date and confirms the extension of the loan term

5. Confirmation of Outstanding Amount: States and confirms the current outstanding principal, accrued interest, and any other amounts due

6. Continuation of Original Terms: Confirms that all other terms and conditions of the original loan agreement remain in full force and effect

7. Representations and Warranties: Updated representations from the borrower regarding their financial condition and ability to repay

8. Conditions Precedent: Lists conditions that must be satisfied before the extension becomes effective

9. Governing Law: Confirms Indonesian law as governing law and jurisdiction for disputes

10. Execution: Signature blocks and execution requirements complying with Indonesian law

What sections are optional to include in a Loan Extension Agreement?

1. Amendment to Interest Rate: Include if there are any changes to the interest rate as part of the extension

2. Modification of Payment Schedule: Include if the payment schedule or installment amounts are being modified

3. Additional Security: Include if new security or guarantees are being added as part of the extension

4. Waiver of Defaults: Include if any existing defaults are being waived as part of the extension

5. Extension Fee: Include if there is a fee charged for the extension

6. Tax Provisions: Include if there are specific tax implications or requirements for the extension

7. Currency Provisions: Include for loans in foreign currency requiring specific exchange rate provisions

What schedules should be included in a Loan Extension Agreement?

1. Schedule 1 - Original Loan Agreement: Copy or summary of the original loan agreement being extended

2. Schedule 2 - Updated Repayment Schedule: Detailed schedule of repayment dates and amounts under the extended term

3. Schedule 3 - Conditions Precedent Documents: List of all documents required to be delivered before the extension becomes effective

4. Schedule 4 - Security Documents: List and copies of existing and/or new security documents

5. Appendix A - Corporate Authorizations: Copies of corporate approvals and authorizations for the extension

6. Appendix B - Calculation of Outstanding Amounts: Detailed calculation of outstanding principal, interest, and other amounts as of the extension date

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Indonesia

Publisher

Ƶ

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions




































Clauses






























Relevant Industries

Banking & Financial Services

Corporate Lending

Real Estate & Property

Manufacturing

Infrastructure & Construction

Agriculture

Mining & Resources

Retail & Commercial

Technology & Telecommunications

Healthcare

Education

Relevant Teams

Legal

Finance

Treasury

Compliance

Risk Management

Credit

Corporate Banking

Operations

Company Secretarial

Loan Administration

Relevant Roles

Chief Financial Officer

Finance Director

Treasury Manager

Legal Counsel

Corporate Lawyer

Compliance Officer

Credit Risk Manager

Relationship Manager

Loan Officer

Banking Operations Manager

Financial Controller

Corporate Secretary

Risk Management Officer

Credit Analyst

Account Manager

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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