A loan agreement represents a contract that relates to loans of cash, but there are contracts regulating securities lending, and these are market-specific contracts. Generally, there are two types of loan agreements, which divide loans into syndicated loans and bilateral loans. Syndicated loans are offered by a group of lenders and are administered, arranged, and structured by one or more arrangers, typically by investment banks or commercial banks.
Then, loan agreements can be categorized by type of facility, resulting in two major sub-categories - revolving loans and term loans such as unsecured loan. Term loans are paid off over a specified term and in installments. Overdrafts or revolving loans are another variety whereby borrowers can withdraw money up to a certain maximum and at a time of their choosing. Interest is due on the amount withdrawn and is paid on a month to month basis.
While the form of loan agreement varies across loan providers, professionally drafted agreements contain a number of elements. Most loan agreements contain repayment provisions, definitions and interpretation provisions, facility and purpose, and parties to contracts. Loan agreements also incorporate interest and interest periods, events of default, prepayment and cancellation provisions, and other elements. The severability clause is another element. This is a provision which specifies that if parts of an agreement are unenforceable or illegal, the other provisions to the contract are still applicable. If certain provision to a contract is essential for its purpose but is found to be illegal or unenforceable, the contract is voided. Some loan agreements incorporate a choice of law clause and a forum selection clause. A 'governing law' or 'choice of law' provision allows parties to a contract to agree on what laws will apply when interpreting clauses to an agreement. A forum selection clause to a contract specifies the cases in which disputes are referred to a particular court. If a forum selection clause is incorporated in an agreement, no party to the contract has the right to file a suit in another court. In addition, loan agreements may incorporate securitization provisions, amendments and waver provisions, and language provisions. A loan agreement may also contain a provision for the appointment of a process agent who serves as a point of contact and represents freight forwarders and carriers. The process agent is also called agent for service of process, registered agent, and resident agent and represents motor carriers and brokers.
Being an independent party, the process agent receives documents and notices under agreements. Finally, some agreements incorporate addresses for notices, covenants of the borrower, securitization provisions, set-off clauses, etc.
Most loan agreements are written, but there may be oral contracts from legal point of view.
Then, loan agreements can be categorized by type of facility, resulting in two major sub-categories - revolving loans and term loans such as unsecured loan. Term loans are paid off over a specified term and in installments. Overdrafts or revolving loans are another variety whereby borrowers can withdraw money up to a certain maximum and at a time of their choosing. Interest is due on the amount withdrawn and is paid on a month to month basis.
While the form of loan agreement varies across loan providers, professionally drafted agreements contain a number of elements. Most loan agreements contain repayment provisions, definitions and interpretation provisions, facility and purpose, and parties to contracts. Loan agreements also incorporate interest and interest periods, events of default, prepayment and cancellation provisions, and other elements. The severability clause is another element. This is a provision which specifies that if parts of an agreement are unenforceable or illegal, the other provisions to the contract are still applicable. If certain provision to a contract is essential for its purpose but is found to be illegal or unenforceable, the contract is voided. Some loan agreements incorporate a choice of law clause and a forum selection clause. A 'governing law' or 'choice of law' provision allows parties to a contract to agree on what laws will apply when interpreting clauses to an agreement. A forum selection clause to a contract specifies the cases in which disputes are referred to a particular court. If a forum selection clause is incorporated in an agreement, no party to the contract has the right to file a suit in another court. In addition, loan agreements may incorporate securitization provisions, amendments and waver provisions, and language provisions. A loan agreement may also contain a provision for the appointment of a process agent who serves as a point of contact and represents freight forwarders and carriers. The process agent is also called agent for service of process, registered agent, and resident agent and represents motor carriers and brokers.
Being an independent party, the process agent receives documents and notices under agreements. Finally, some agreements incorporate addresses for notices, covenants of the borrower, securitization provisions, set-off clauses, etc.
Most loan agreements are written, but there may be oral contracts from legal point of view.
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