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1. Parties: Identification of the lender and borrower with complete legal names and addresses
2. Background: Details of the original loan agreement, including date, principal amount, and current outstanding balance
3. Definitions: Key terms used throughout the agreement including 'Settlement Amount', 'Settlement Date', 'Original Loan Agreement', etc.
4. Settlement Amount: Clear statement of the agreed settlement sum and whether this represents a discount from the total outstanding amount
5. Payment Terms: Details of how and when the settlement amount will be paid, including payment method and deadline
6. Release and Discharge: Terms confirming that payment of the settlement amount will fully discharge the borrower's obligations
7. Representations and Warranties: Statements by both parties confirming their authority to enter into the agreement and the validity of the settlement
8. Confidentiality: Provisions regarding the confidential nature of the settlement terms
9. Governing Law and Jurisdiction: Confirmation that Philippine law governs the agreement and specification of jurisdiction for disputes
10. Execution: Signature blocks and execution requirements
1. Tax Provisions: Include when there are specific tax implications or requirements that need to be addressed
2. Security Release: Include when the original loan was secured and security arrangements need to be terminated
3. Installment Terms: Include when the settlement amount is to be paid in installments rather than as a lump sum
4. Default Provisions: Include when settlement is to be paid in installments, specifying consequences of default
5. Non-Disparagement: Include when parties wish to prevent negative statements about the settlement
6. Return of Documents: Include when original loan documents need to be returned or destroyed
7. Third Party Rights: Include when guarantors or other third parties are involved in the original loan
1. Schedule 1 - Original Loan Details: Copy or summary of the original loan agreement and any amendments
2. Schedule 2 - Payment Schedule: If payment is in installments, detailed schedule of payment dates and amounts
3. Schedule 3 - Calculation of Settlement Amount: Detailed breakdown of how the settlement amount was calculated
4. Appendix A - Form of Release: Template for the final release document to be issued upon completion of settlement
5. Appendix B - Security Release Documents: Forms for releasing any security interests (if applicable)
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