Cafe Loan Agreement
Cafe Loan Agreement
This Cafe Loan Agreement ("Agreement") is made and entered into on [Month Day, Year], by and between [Your Company Name], with its principal place of business located at [Your Company Address] ("Borrower"), and [Lender Name], with its principal place of business located at [Lender Address] ("Lender").
WHEREAS, the Borrower operates a cafe business and requires additional funding to support its operations and growth;
WHEREAS, the Lender is willing to provide a loan to the Borrower, subject to the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and for other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the parties hereto agree as follows:
1. Loan Amount
1.1 The Lender agrees to provide the Borrower with a loan in the principal amount of [Loan Amount] USD (the "Loan"). This Loan is provided specifically for the business purposes of the Borrower's cafe operations.
1.2 The Borrower acknowledges that the Loan will be used solely for the purposes stated and not for any personal expenses or unrelated business activities.
1.3 Any deviation from the specified use of the Loan must be approved in writing by the Lender prior to the allocation of funds.
1.4 The Borrower agrees to furnish the Lender with periodic reports detailing the use of the Loan funds, ensuring transparency and accountability.
1.5 In the event the Loan funds are not utilized for the stated purposes, the Lender reserves the right to demand immediate repayment of the Loan in full.
2. Interest Rate
2.1 The Loan shall bear interest at a fixed rate of [Interest Rate]% per annum. The interest will be calculated on the outstanding principal balance and will accrue daily based on a 360-day year.
2.2 Interest payments shall be due and payable in arrears on the [Day] of each month, commencing on [Interest Payment Start Date].
2.3 In the event of a default, the interest rate on the outstanding principal balance shall increase to [Default Interest Rate]% per annum until the default is remedied.
2.4 The Borrower agrees to pay any additional costs or fees associated with the calculation and payment of interest, as stipulated by the Lender.
2.5 The Lender retains the right to adjust the interest rate in accordance with applicable laws and regulations, provided that any such adjustment is communicated to the Borrower in writing at least [Notice Period] days in advance.
3. Repayment Terms
3.1 The Borrower agrees to repay the Loan in [Repayment Period] installments. Each installment shall be due on the [Day] of each month, starting from [Starting Month] until the Loan is fully paid off.
3.2 The amount of each installment will be [Installment Amount] USD, which includes both principal and accrued interest.
3.3 The Borrower may make additional payments towards the principal amount without any prepayment penalty, thus potentially reducing the total interest payable over the term of the Loan.
3.4 In the event of partial prepayment, the remaining balance will be recalculated, and the Borrower will be provided with a new repayment schedule reflecting the updated principal and interest amounts.
3.5 The Borrower shall provide the Lender with a minimum of [Notice Period for Additional Payments] days' notice prior to making any additional payments.
3.6 Late payments will incur a penalty fee of [Late Payment Fee] USD per day, and continuous late payments exceeding [Late Payment Duration] days may result in the Loan being declared in default.
3.7 In the event of a default, the Lender may demand immediate repayment of the entire outstanding Loan balance, including all accrued interest and any applicable fees or penalties.
4. Collateral
4.1 As security for the Loan, the Borrower agrees to provide the following collateral: a lien on all kitchen equipment, furniture, and fixtures located at the Borrower's cafe premises at [Your Company Address], including but not limited to ovens, refrigerators, tables, chairs, and signage. The Borrower agrees to maintain the collateral in good condition and ensure it remains free of any encumbrances. The Borrower also agrees not to remove, sell, or transfer ownership of the collateral without the prior written consent of the Lender.
4.2 The Borrower warrants that the collateral is free and clear of all liens, encumbrances, and other claims and that they have full authority to pledge such assets.
4.3 The Borrower agrees to provide the Lender with proof of ownership and any other documentation required to establish the Lender's security interest in the collateral.
4.4 The Borrower shall not sell, transfer, or otherwise dispose of the collateral without the prior written consent of the Lender.
4.5 In the event that the collateral depreciates in value or is damaged, the Borrower agrees to replace or repair the collateral to the satisfaction of the Lender or provide additional collateral to maintain the security interest.
4.6 The Lender reserves the right to inspect the collateral at any reasonable time upon giving prior notice to the Borrower.
5. Borrower's Obligations
5.1 The Borrower agrees to use the Loan exclusively for the stated business purposes related to the operation of the cafe.
5.2 The Borrower will keep accurate financial records, including all receipts and documentation related to the use of the Loan funds, and provide the Lender with financial statements as requested.
5.3 The Borrower agrees to notify the Lender of any significant changes in its financial condition or operations, including but not limited to changes in management, ownership, or the financial health of the business.
5.4 The Borrower will comply with all applicable laws, regulations, and business practices to ensure the lawful and efficient operation of the cafe.
5.5 The Borrower shall permit the Lender or its representatives to audit the Borrower's financial records and operations to verify compliance with the terms of this Agreement.
5.6 The Borrower agrees to maintain adequate insurance coverage for the collateral and the cafe operations, naming the Lender as an additional insured and loss payee.
6. Lender's Rights
6.1 In the event of a default by the Borrower, the Lender reserves the right to claim the collateral provided as security for the Loan. This includes the right to take possession, sell, or otherwise dispose of the collateral to recover the outstanding loan balance.
6.2 The Lender may also pursue any other legal remedies available under the laws of [State] to recover the outstanding loan balance and any accrued interest or fees, including filing a lawsuit, obtaining a judgment, and garnishing the Borrower's assets.
6.3 The Lender has the right to accelerate the repayment schedule and demand immediate payment of the entire outstanding balance, including principal, interest, and any applicable fees, in the event of a default.
6.4 The Lender may assess reasonable costs and expenses, including attorney's fees, incurred in the enforcement of the Loan Agreement and collection of the debt.
6.5 The Lender reserves the right to assign or transfer its rights and interests under this Agreement to a third party, provided that such assignment does not materially affect the Borrower's obligations.
6.6 The Lender retains the right to periodically review and amend the terms of the Loan Agreement, subject to applicable laws and regulations, with prior written notice to the Borrower.
7. Early Repayment
7.1 The Borrower may repay the Loan in full or in part at any time without penalty. Any early repayment will first be applied towards any outstanding interest, with the remaining amount reducing the principal balance of the Loan.
7.2 The Borrower shall provide the Lender with written notice of its intention to make an early repayment, specifying the amount and date of the intended repayment.
7.3 The Lender reserves the right to verify the source of funds for any early repayment to ensure compliance with anti-money laundering regulations and to protect against fraud.
8. Late Fees
8.1 In the event that any installment payment is not made by the due date, the Borrower will be subject to a late fee of [Late Fee Amount] USD for each late payment. This late fee will be added to the outstanding balance of the Loan.
8.2 The Borrower acknowledges that late payments may negatively impact its credit rating and financial standing and agrees to make timely payments to avoid late fees and penalties.
8.3 The Lender may waive or reduce the late fee at its discretion, provided that such waiver or reduction does not constitute a waiver of the Lender's rights to enforce timely payment in the future.
9. Dispute Resolution
9.1 Any disputes arising out of or in connection with this Agreement shall be resolved amicably between the parties through good-faith negotiations.
9.2 If an amicable resolution cannot be reached, the parties agree to submit to the exclusive jurisdiction of the courts located in [State] for resolution.
9.3 Each party shall bear its own costs and expenses incurred in connection with any dispute resolution proceedings, including but not limited to legal fees and court costs.
9.4 The parties agree to waive any right to a jury trial in connection with any dispute arising out of or in connection with this Agreement.
10. Governing Law
10.1 This Agreement shall be governed by and construed in accordance with the laws of [State].
10.2 Any legal action or proceeding arising out of or in connection with this Agreement shall be brought exclusively in the courts located in [State].
10.3 The parties hereby irrevocably submit to the jurisdiction of such courts for the purpose of any such legal action or proceeding.
10.4 The parties hereby waive any objection to the venue of any such legal action or proceeding in such courts and any claim that such action or proceeding has been brought in an inconvenient forum.
10.5 This choice of law and forum selection clause is intended to be mandatory and not permissive in nature, thereby precluding the possibility of litigation in any jurisdiction other than that specified in this section.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the Effective Date stated above, acknowledging that they have read, understood, and agreed to all the terms and conditions contained herein. The parties further acknowledge that they have executed this Agreement voluntarily and without any undue influence or coercion.
By: 
[Your Name]
[Your Job Title]
[Your Company Name]
Date: [Month Day, Year]
By:
[Lender Name]
[Job Title]
Date: [Month Day, Year]
