BUSINESS LOAN AGREEMENT template

Below is a template for a business loan agreement between Company A (the lender) and Company B (the borrower), which includes an interest rate of 5%.

BUSINESS LOAN AGREEMENT

This Business Loan Agreement ("Agreement") is made and entered into as of [Date], by and between:

Company A, a [State] corporation, with its principal office located at [Address] ("Lender"),

and

Company B, a [State] corporation, with its principal office located at [Address] ("Borrower").

RECITALS

WHEREAS, the Lender agrees to loan a certain amount of funds to the Borrower, and the Borrower agrees to repay this loan under the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and promises hereinafter set forth, the parties hereto agree as follows:

1. Loan Amount and Disbursement

1.1 The Lender agrees to loan the Borrower the principal sum of [Loan Amount] ("Loan").

1.2 The Loan will be disbursed to the Borrower on [Disbursement Date].

2. Interest Rate

2.1 The Loan shall bear an interest rate of 5% per annum, calculated on the basis of a 365-day year.

3. Repayment Terms

3.1 The Borrower agrees to repay the Loan in [number of installments] installments of [Installment Amount] each, beginning on [First Payment Date] and continuing on the [Day] of each subsequent month until the Loan is fully repaid.

3.2 The Borrower may prepay the Loan in whole or in part at any time without penalty.

4. Late Payments

4.1 If any payment due under this Agreement is not received by the Lender within [number] days of the due date, the Borrower shall pay a late fee of [Late Fee Amount].

5. Use of Loan Proceeds

5.1 The Borrower agrees to use the Loan proceeds solely for [purpose of loan].

6. Representations and Warranties

6.1 The Borrower represents and warrants that it is duly organized, validly existing, and in good standing under the laws of [State].

6.2 The Borrower has the power and authority to enter into and perform its obligations under this Agreement.

7. Covenants

7.1 The Borrower shall maintain its corporate existence and comply with all applicable laws and regulations.

7.2 The Borrower shall provide the Lender with financial statements or other reports as the Lender may reasonably request.

8. Default

8.1 The following events shall constitute an Event of Default under this Agreement:

(a) Failure to make any payment when due;

(b) Breach of any covenant, representation, or warranty contained in this Agreement;

(c) Insolvency or bankruptcy of the Borrower.

8.2 Upon the occurrence of an Event of Default, the Lender may declare the entire unpaid principal balance of the Loan, together with all accrued interest, to be immediately due and payable.

9. Miscellaneous

9.1 This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements and understandings.

9.2 Any amendments or modifications to this Agreement must be in writing and signed by both parties.

9.3 This Agreement shall be governed by and construed in accordance with the laws of the State of [State].

9.4 Any disputes arising out of or in connection with this Agreement shall be resolved through [mediation/arbitration/court].

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

LENDER:

Company A

By: ___________________________
Name: [Name]
Title: [Title]

BORROWER:

Company B

By: ___________________________
Name: [Name]
Title: [Title]

This template covers the essential terms and conditions of a business loan agreement, including the loan amount, interest rate, repayment terms, use of loan proceeds, representations and warranties, covenants, default events, and miscellaneous provisions. Be sure to customize the template to fit the specific details and legal requirements of the parties involved.

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