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Bilateral Loan Agreement for the United States

Bilateral Loan Agreement Template for United States

A comprehensive legal agreement governed by United States law that establishes the terms and conditions under which one party (the lender) agrees to provide financial accommodation to another party (the borrower). The agreement details the loan amount, interest rates, repayment terms, conditions precedent, representations and warranties, covenants, events of default, and other key provisions that govern the lending relationship. It incorporates both federal lending regulations and applicable state laws, particularly regarding usury limits and security interests.

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What is a Bilateral Loan Agreement?

The Bilateral Loan Agreement is a fundamental financing document used when one party seeks to borrow funds from another party in a direct lending arrangement. This agreement is essential for commercial lending transactions in the United States, incorporating federal regulations such as the Truth in Lending Act and state-specific usury laws. It serves as the primary document establishing the rights and obligations of both the lender and borrower, including crucial elements such as loan amount, interest calculations, repayment terms, security arrangements, and default provisions. The agreement is particularly important for maintaining clarity and legal enforceability in lending relationships, whether for corporate financing, asset acquisition, working capital, or other business purposes. Each agreement can be customized to address specific transaction requirements while maintaining compliance with applicable US federal and state lending regulations.

What sections should be included in a Bilateral Loan Agreement?

1. Parties: Identifies and defines the Lender and Borrower with their full legal names and addresses

2. Background: Explains the context and purpose of the loan agreement

3. Definitions: Defines key terms used throughout the agreement

4. The Loan: Details the principal amount, purpose, and availability of the loan

5. Interest: Specifies interest rate, calculation method, and payment periods

6. Repayment: Sets out the repayment schedule, prepayment terms, and payment mechanics

7. Conditions Precedent: Lists conditions that must be satisfied before the loan is advanced

8. Representations and Warranties: States the facts and assurances provided by the Borrower

9. Covenants: Details ongoing obligations of the Borrower, including financial covenants

10. Events of Default: Lists circumstances that constitute default and their consequences

11. Fees and Expenses: Outlines all fees, costs, and expenses related to the loan

12. Notices: Specifies how formal communications between parties should be made

13. Assignment and Transfer: Sets out rules for transferring or assigning rights under the agreement

14. Governing Law and Jurisdiction: Specifies applicable law and courts for dispute resolution

15. Execution: Signature blocks and execution formalities

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

1. Security: Required if the loan is secured by collateral or guarantees

2. Syndication Provisions: Required if there are multiple lenders or potential for loan syndication

3. Tax Provisions: Detailed tax clauses needed for cross-border loans or complex tax structures

4. Insurance Requirements: Detailed insurance obligations when specific coverage is required

5. Intercreditor Provisions: Required when there are multiple creditors with different priorities

6. Environmental Compliance: Required for loans involving real estate or industrial operations

7. Financial Calculations: Detailed calculation provisions for complex financial covenants

8. Currency Provisions: Required for multi-currency loans or international transactions

What schedules should be included in a Bilateral Loan Agreement?

1. Schedule 1 - Loan Terms: Detailed breakdown of loan amount, interest rates, and payment dates

2. Schedule 2 - Conditions Precedent Documents: List of required documents and conditions to be satisfied

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

4. Schedule 4 - Form of Drawdown Notice: Template for requesting loan disbursements

5. Schedule 5 - Security Details: Description of collateral and security arrangements if applicable

6. Schedule 6 - Financial Covenants: Detailed financial ratios and calculations

7. Schedule 7 - Permitted Security Interests: List of existing or permitted liens and encumbrances

8. Schedule 8 - Forms of Compliance Certificate: Template for periodic compliance reporting

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

United States

Publisher

Ƶ

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions































































Clauses








































Relevant Industries

Banking

Financial Services

Real Estate

Manufacturing

Technology

Healthcare

Retail

Energy

Infrastructure

Agriculture

Transportation

Construction

Telecommunications

Relevant Teams

Legal

Finance

Treasury

Compliance

Risk Management

Credit

Corporate Banking

Executive Leadership

Business Development

Company Secretariat

Relevant Roles

Chief Financial Officer

Finance Director

Treasury Manager

Legal Counsel

Corporate Lawyer

Compliance Officer

Credit Risk Manager

Loan Officer

Relationship Manager

Chief Executive Officer

Financial Controller

Business Development Manager

Commercial Director

Risk Manager

Company Secretary

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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