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Credit Agreement Contract for Philippines

Credit Agreement Contract Template for Philippines

A Credit Agreement Contract governed by Philippine law is a legally binding document that establishes the terms and conditions under which a lender provides financial credit to a borrower. The agreement must comply with Philippine banking regulations, particularly those set by the Bangko Sentral ng Pilipinas (BSP), the Truth in Lending Act, and other relevant financial regulations. It details the loan amount, interest rates, repayment terms, security arrangements, events of default, and remedies available to the parties. The document incorporates specific Philippine legal requirements for lending transactions while protecting both lender and borrower interests through clear documentation of rights and obligations.

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What is a Credit Agreement Contract?

The Credit Agreement Contract is a fundamental document in Philippine banking and finance, used when a lender extends credit facilities to a borrower. It serves as the primary documentation for loan transactions, whether for corporate financing, project funding, or business expansion. The agreement must align with Philippine banking regulations, including BSP circulars, the Truth in Lending Act, and the New Central Bank Act. This document is essential for protecting both lender and borrower interests by clearly defining the credit terms, security arrangements, representations and warranties, covenants, and default provisions. It includes specific requirements for Philippine jurisdiction such as mandatory truth in lending disclosures, interest rate calculations following BSP guidelines, and local security perfection requirements.

What sections should be included in a Credit Agreement Contract?

1. Parties: Identification of the lender and borrower with complete legal names and addresses

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

3. Definitions: Defined terms used throughout the agreement including financial terms and calculation methods

4. Facility Details: Amount, purpose, and type of credit facility being provided

5. Interest and Fees: Interest rate, calculation method, fees, charges and payment terms

6. Drawdown Conditions: Prerequisites and conditions for loan disbursement

7. Representations and Warranties: Borrower's declarations regarding their legal and financial status

8. Covenants: Positive and negative undertakings of the borrower

9. Events of Default: Circumstances that constitute default and remedies available to the lender

10. Payment Terms: Repayment schedule, prepayment provisions, and payment mechanics

11. Security: Details of collateral or other security arrangements

12. Governing Law and Jurisdiction: Specification of Philippine law as governing law and jurisdiction details

13. Notices: Communication procedures between parties

14. Miscellaneous: Standard boilerplate provisions including severability, amendments, and entire agreement

What sections are optional to include in a Credit Agreement Contract?

1. Guarantees: Required when there are third-party guarantors for the loan

2. Insurance: Detailed insurance requirements for specific types of secured loans

3. Multiple Borrowers: Additional provisions for joint and several liability when there are multiple borrowers

4. Foreign Currency Provisions: Required for loans denominated in foreign currency

5. Special Purpose Covenants: Additional covenants for specific loan purposes (e.g., construction, business acquisition)

6. Electronic Execution: Provisions for electronic signing and documentation if permitted

7. Agent Provisions: Required for syndicated loans with multiple lenders

What schedules should be included in a Credit Agreement Contract?

1. Schedule 1 - Loan Details: Detailed breakdown of facility amount, interest rates, and fees

2. Schedule 2 - Conditions Precedent: List of required documents and conditions before drawdown

3. Schedule 3 - Repayment Schedule: Detailed amortization schedule if applicable

4. Schedule 4 - Security Details: Specific description of collateral and security arrangements

5. Schedule 5 - Form of Drawdown Notice: Template for borrower's drawdown requests

6. Schedule 6 - Compliance Certificate: Template for periodic compliance reporting

7. Appendix A - Calculation of Financial Covenants: Detailed methodology for calculating financial ratios and covenants

8. Appendix B - Standard Forms: Collection of standard forms for notices, certificates, and other communications

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

Philippines

Publisher

Ƶ

Document Type

Credit Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions










Clauses









































Relevant Industries

Banking and Financial Services

Corporate Lending

Real Estate

Manufacturing

Retail

Agriculture

Construction

Technology

Healthcare

Education

Transportation

Energy

Infrastructure

Small and Medium Enterprises

Relevant Teams

Legal

Finance

Risk Management

Compliance

Credit Administration

Treasury

Corporate Banking

Operations

Business Development

Documentation

Loan Administration

Due Diligence

Corporate Secretariat

Internal Audit

Relevant Roles

Chief Financial Officer

Finance Director

Credit Risk Manager

Legal Counsel

Corporate Lawyer

Loan Officer

Credit Analyst

Compliance Officer

Treasury Manager

Financial Controller

Business Development Manager

Account Manager

Risk Assessment Officer

Banking Operations Manager

Corporate Secretary

Finance Manager

Managing Director

Chief Executive Officer

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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