Free Legal Contract Loan Agreement Template
Legal Contract Loan Agreement
This Loan Agreement ("Agreement") is made and entered into on [Date] by and between:
Lender: [Your Company Name], a corporation duly organized and existing under the laws of the State of [State], with its principal place of business located at [Your Company Address], hereinafter referred to as "the Lender".
Borrower: [Name], a limited liability company duly organized and existing under the laws of the State of [State], with its principal place of business located at [Address], hereinafter referred to as "the Borrower".
WHEREAS, the Borrower desires to borrow a specified amount of money and the Lender agrees to lend that amount under the terms and conditions set forth in this Agreement;
WHEREAS, the parties intend this Agreement to set forth the terms and conditions under which the loan will be made and the responsibilities and obligations of the parties involved;
NOW, THEREFORE, in consideration of the mutual covenants, promises, and agreements herein contained, the parties hereto agree as follows:
I. Loan Amount and Disbursement
A. The Lender agrees to loan the Borrower a total sum of $100,000 (One Hundred Thousand Dollars).
B. The loan amount shall be disbursed to the Borrower in a single installment within 5 (five) business days following the execution of this Agreement, directly into the bank account specified by the Borrower.
C. The Borrower shall use the loan amount exclusively for the purpose of expanding its operational capacity, as detailed in the Business Expansion Plan submitted to the Lender prior to the execution of this Agreement.
II. Interest Rate
A. The loan shall bear an annual interest rate of 5% (five percent).
B. The interest shall be calculated on a 365-day year basis and shall be compounded annually.
C. The interest accruing on the loan shall be payable monthly, commencing one month from the date of disbursement of the loan amount.
III. Repayment Terms
A. The Borrower agrees to repay the principal amount of the loan and any accrued interest over a period of 5 (five) years from the date of disbursement.
B. Repayments shall be made in monthly installments of $1,887.12, with the first installment due one month after the loan disbursement date.
C. In the event of prepayment, the Borrower may, without penalty, pay the outstanding balance of the loan in full or in part at any time. Any prepayment shall first be applied to the accrued interest and then to the principal amount.
D. If the Borrower fails to make any monthly installment within 10 (ten) days after the due date, a late payment fee of 2% of the overdue amount shall be applied.
IV. Collateral
A. As security for the loan, the Borrower agrees to pledge its commercial property located at [Property Address], as collateral.
B. The Lender shall have the right to inspect the collateral at any reasonable time to ensure its maintenance and condition.
C. In the event of default, the Lender shall have the right to seize and sell the collateral following the applicable laws to recover the outstanding loan amount.
V. Covenants
A. The Borrower covenants to maintain comprehensive insurance on the collateral property, with the Lender listed as a loss payee.
B. The Borrower further covenants to not encumber the collateral with any additional liens or mortgages without the prior written consent of the Lender.
C. The Borrower shall comply with all applicable laws and regulations related to its business operations and the use of the loan amount.
VI. Default and Remedies
A. Default shall occur if the Borrower fails to make any payment within 30 days of the due date or breaches any covenant of this Agreement.
B. Upon default, the Lender may declare the entire outstanding balance of the loan, including accrued interest, immediately due and payable.
C. In addition to the right to seize and sell the collateral, the Lender may pursue any other legal remedies available to recover the owed amounts.
D. The Borrower shall be responsible for all costs incurred by the Lender in enforcing this Agreement, including reasonable attorneys' fees and court costs.
VII. Amendments and Waivers
A. Any amendments, modifications, or waivers to this Agreement must be in writing and signed by both the Lender and the Borrower.
B. The failure of either party to enforce any rights under this Agreement shall not be deemed a waiver of those or any other rights.
VIII. Notices
A. All notices, requests, demands, and other communications under this Agreement shall be in writing and shall be deemed to have been duly given on the date of delivery if delivered personally or by email, or on the third business day after mailing if mailed by first class mail, postage prepaid, to the addresses specified below:
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If to the Lender: [Your Company Address], [Your Company Email]
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If to the Borrower: [Address], [Email]
B. Either party may change their address for notice by giving written notice of such change to the other party in accordance with this section.
IX. Governing Law
A. This Agreement shall be governed by and construed in accordance with the laws of the State of [State], without regard to its conflict of laws principles.
B. Any legal action or proceeding arising out of or related to this Agreement shall be brought exclusively in the courts of the State of [State], and the parties hereby consent to the jurisdiction and venue of such courts.
X. Dispute Resolution
In the event of any dispute, claim, question, or disagreement arising from or relating to this Agreement or the breach thereof, the parties hereto shall use their best efforts to settle the dispute, claim, question, or disagreement. To this effect, they shall consult and negotiate with each other in good faith and, recognizing their mutual interests, attempt to reach a just and equitable solution satisfactory to both parties. If they do not reach such solution within a period of 60 days, then, upon notice by either party to the other, all disputes, claims, questions, or disagreements shall be finally settled by arbitration administered by the American Arbitration Association in accordance with the provisions of its Commercial Arbitration Rules.
XI. Miscellaneous
A. This Agreement constitutes the entire agreement between the parties concerning the subject matter hereof and supersedes all previous agreements and understandings, whether oral or written, between the parties with respect to that subject matter.
B. No provision of this Agreement may be amended, modified, waived, or discharged unless such amendment, modification, waiver, or discharge is agreed to in writing and signed by the Borrower and the Lender.
C. If any provision of this Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any way.
D. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
Signatures
IN WITNESS WHEREOF, the parties hereto have executed this Loan Agreement as of the date first above written.
Lender
[Signature]
[Your Name]
[Title]
[Date]
Borrower
[Signature]
[Name]
[Title]
[Date]
