Document background
The Loan Note Subscription Agreement is a key financing document used when a company seeks to raise debt financing through the issuance of loan notes. This document type is particularly relevant in the South African market where companies look for alternatives to traditional bank financing or wish to structure their debt in a way that can accommodate multiple lenders or specific commercial requirements. The agreement details the entire relationship between the issuer and subscriber(s), including the amount of financing, interest rates, repayment terms, security (if any), and various protections for both parties. It must be drafted in compliance with South African law, particularly considering the Companies Act No. 71 of 2008, Financial Markets Act No. 19 of 2012, and other relevant financial services legislation. The document is typically used for medium to long-term financing arrangements and can be structured to accommodate both single and multiple subscribers, with varying levels of complexity depending on the transaction requirements.
