Travel Agency Loan Contract
Travel Agency Loan Contract
This Loan Contract ("Contract") is entered into as of [Date], by and between:
Borrower: [Your Company Name] ("Borrower"), a company incorporated and existing under the laws of [State/Country], with a principal place of business located at [Your Company Address].
Lender: [Lender Name] ("Lender"), a [corporation/partnership/individual] incorporated and existing under the laws of [State/Country], with a principal place of business located at [Lender Address].
Whereas, the Borrower is in the business of providing travel agency services, including booking airline tickets, travel packages, and hotel reservations;
Whereas, the Borrower seeks to expand its operations and requires financial assistance to achieve its business objectives;
Whereas, the Lender has agreed to extend a loan to the Borrower under the terms and conditions set forth herein;
Now, therefore, in consideration of the mutual covenants and promises herein contained, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
Article 1: Loan Amount and Disbursement
1.1 The Lender agrees to loan the Borrower the principal sum of [Loan Amount] dollars ($[Amount]) (the "Loan").
1.2 The Loan will be disbursed to the Borrower’s designated account upon execution of this Contract and completion of all necessary formalities.
Article 2: Purpose of Loan
2.1 The Loan shall be exclusively used for business expansion, including enhancements to the Borrower’s online booking system, marketing initiatives, and acquisition of new office equipment. The Loan shall not be used for any purpose other than those expressly stated herein without prior written consent of the Lender.
Article 3: Interest Rate and Terms
3.1 The Loan shall accrue interest at an annual rate of [Interest Rate]% compounded monthly. This rate is fixed for the term of the Loan and will not fluctuate with market conditions.
3.2 Interest calculation starts from the date the Loan funds are disbursed to the Borrower and continues until the full repayment of the Loan, including any accrued interest and fees.
3.3 A grace period of [Number] days will be provided for each payment, after which the late payment charge as specified in 3.3 will apply.
3.4 Interest will be calculated on a 360-day-year basis, commonly used in commercial loans for simpler interest calculation.
Article 4: Repayment
4.1 Repayment will commence as specified and continue monthly. Each payment will be applied first to late payment fees, then to accrued interest, and the remainder to principal reduction.
4.2 The Borrower has the right to make larger payments than scheduled or a complete prepayment of the Loan without facing any prepayment fees or penalties, which encourages faster debt resolution.
4.3 In case of prepayment, the Borrower must notify the Lender at least [Number] days in advance in writing.
4.4 Should the Borrower experience financial hardship, a deferment of payment for a period of up to [Number] months may be negotiated, subject to Lender approval and possible adjustment of terms.
Article 5: Security
5.1 To secure repayment of the Loan, the Borrower offers a lien on all business assets including but not limited to office equipment, vehicles, and receivables, as detailed in Schedule A.
This schedule outlines the assets pledged as collateral for the Loan provided under this Contract:
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Office Equipment: Includes computers, printers, and other office technology currently used in the daily operations of the Borrower’s business.
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Vehicles: Consists of [number and type of vehicles], used for business operations, including client transport and administrative duties.
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Receivables: All current accounts receivable owed to the Borrower by its clients as of the date of this Contract.
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Miscellaneous Assets: Additional assets include furniture, fixtures, and any other physical assets listed in the detailed asset register.
This collateral secures the Loan and is subject to inspection and appraisal as specified in the terms of this Contract.
5.2 The Lender is entitled to periodic inspections of the collateral. The Borrower must comply and provide access to premises during normal business hours upon reasonable notice.
5.3 The Borrower must maintain the collateral in good working condition and protect it from any form of deterioration beyond normal wear and tear.
Article 6: Reporting and Monitoring
6.1 Financial Reporting: The Borrower agrees to submit quarterly financial reports to the Lender, including balance sheets, income statements, and cash flow statements, within 45 days following the end of each quarter. Additionally, the Borrower shall provide annual audited financial statements prepared by an independent certified public accountant within 90 days of the fiscal year-end.
6.2 Operational Reporting: The Borrower shall provide annual reports on its operations, which include new business activities, changes in management, and significant operational challenges or opportunities. This report should also detail marketing efforts and outcomes related to the business expansion funded by this Loan.
6.3 Compliance Monitoring: The Borrower agrees to comply with all local, state, and federal laws applicable to its business operations. The Borrower must inform the Lender of any non-compliance issues that may arise and affect the Borrower's ability to fulfill its obligations under this Contract.
6.4 Site Visits: The Lender shall have the right to conduct site visits at the Borrower’s principal place of business or at any location where the collateral is held, to inspect operations and the condition and status of the pledged collateral. Such visits shall be conducted no more than twice per year unless an event of default occurs, and will be conducted during normal business hours and with reasonable prior notice.
Article 7: Borrower’s Covenants
7.1 The Borrower shall not engage in any business activities substantially different from its present operations without prior written consent from the Lender.
7.2 The Borrower agrees to provide quarterly financial statements within 45 days after the end of each quarter.
7.3 The Borrower must maintain insurance coverage as agreed upon, with the Lender listed as loss payee, and provide annual proof of such insurance.
7.4 The Borrower must notify the Lender immediately of any legal actions taken against the business that could materially affect the operation or financial status.
Article 8: Default
8.1 Additional default conditions include significant damage to the collateral, a change in control of the Borrower’s company without the Lender’s written consent, and any false statement by the Borrower in connection with the Loan.
8.2 Upon default, the Lender has the right to take possession of and, if necessary, sell the collateral without recourse to legal processes, as agreed upon in the security agreement.
8.3 The Lender may require immediate payment of all fees and costs associated with the collection of the debt, including reasonable attorney's fees.
Article 9: General Provisions
9.1 Any waiver by the Lender of a breach of any provision of this Contract shall not operate as or be construed to be a waiver of any other breach.
9.2 If any provision of this Contract is found to be invalid or unenforceable, the remaining provisions will continue to be valid and enforceable.
9.3 This Contract may be executed in counterparts, each of which shall be deemed an original, but all of which together will constitute one and the same instrument.
9.4 This Contract is binding upon and will inure to the benefit of the parties, their successors, and permitted assigns.
IN WITNESS WHEREOF, the parties have executed this Loan Contract on the day and year first above written.
BORROWER
[Your Name]
[Title]
LENDER
[Lender Name]
[Title]
