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Finance Agreement for Philippines

Finance Agreement Template for Philippines

A comprehensive legal document governed by Philippine law that establishes the terms and conditions of a financing arrangement between a lender and borrower. The agreement complies with Philippine banking regulations, including BSP circulars and the Truth in Lending Act, and details the facility amount, interest rates, repayment terms, security arrangements (if any), representations and warranties, covenants, and events of default. It incorporates specific Philippine legal requirements regarding disclosure, consumer protection, and banking regulations while providing a clear framework for the rights and obligations of all parties involved in the financing transaction.

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What is a Finance Agreement?

The Finance Agreement serves as the primary documentation for lending transactions in the Philippines, whether for corporate financing, project finance, or personal loans. It is essential for establishing legally binding financing arrangements that comply with Philippine banking regulations, including BSP requirements and the Truth in Lending Act. The document is typically used when a lender (usually a financial institution) provides funding to a borrower, and needs to document the terms of the facility, including amount, purpose, interest rates, repayment schedule, security (if any), and other key terms. The agreement must incorporate specific Philippine legal requirements regarding disclosure, consumer protection, and banking regulations, while also addressing practical aspects of the financing arrangement such as drawdown mechanics, covenants, and events of default.

What sections should be included in a Finance Agreement?

1. Parties: Identifies and defines the parties to the agreement, including their legal status and addresses

2. Background: Sets out the context and purpose of the financing arrangement

3. Definitions: Defines key terms used throughout the agreement

4. Facility: Details of the loan/credit facility, including amount, purpose, and availability

5. Interest and Fees: Specifies interest rates, calculation methods, and all applicable fees as required by Philippine Truth in Lending Act

6. Drawdown: Conditions and procedures for drawing down the facility

7. Repayment: Terms and schedule of repayment, including prepayment provisions

8. Representations and Warranties: Standard and Philippines-specific representations and warranties

9. Covenants: Positive and negative covenants, including compliance with Philippine laws

10. Events of Default: Circumstances constituting default and consequences

11. Changes to Parties: Rules for assignment and transfer of rights and obligations

12. Administration: Administrative provisions, notices, calculations

13. Governing Law and Jurisdiction: Confirms Philippine law as governing law and jurisdiction arrangements

What sections are optional to include in a Finance Agreement?

1. Security: Required if the facility is secured - details security arrangements and enforcement rights

2. Guarantee: Required if there are guarantors to the facility

3. Insurance: Required if specific insurance coverage is mandatory for the facility

4. Increased Costs and Tax Gross-up: Used in larger commercial financings to address regulatory and tax changes

5. Anti-Money Laundering Provisions: Detailed AML provisions for larger or cross-border transactions

6. Multi-currency Provisions: Required if the facility can be drawn in multiple currencies

7. Syndication Provisions: Required for syndicated facilities with multiple lenders

What schedules should be included in a Finance Agreement?

1. Schedule 1 - Conditions Precedent: List of required documents and conditions to be satisfied before drawdown

2. Schedule 2 - Form of Drawdown Request: Template for borrower to request drawdown of funds

3. Schedule 3 - Repayment Schedule: Detailed amortization or repayment schedule

4. Schedule 4 - Calculation of Interest and Fees: Detailed methodology for calculating interest and fees as per Philippine regulations

5. Schedule 5 - Form of Transfer Certificate: Template for transferring rights and obligations under the agreement

6. Schedule 6 - Security Details: Details of any security assets and registration requirements under Philippine law

7. Schedule 7 - Contact Details: Contact information for all parties and designated representatives

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

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions

































































Clauses

































Relevant Industries

Banking

Financial Services

Real Estate

Infrastructure

Manufacturing

Agriculture

Technology

Retail

Energy

Transportation

Healthcare

Education

Construction

Mining

Telecommunications

Relevant Teams

Legal

Finance

Treasury

Compliance

Risk Management

Corporate Finance

Credit

Operations

Corporate Secretariat

Business Development

Relevant Roles

Chief Financial Officer

Finance Director

Treasury Manager

Corporate Lawyer

Legal Counsel

Compliance Officer

Credit Risk Manager

Relationship Manager

Investment Officer

Corporate Secretary

Financial Controller

Banking Officer

Loan Officer

Chief Executive Officer

Chief Legal Officer

Risk Manager

Finance Manager

Corporate Finance 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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