Document background
The Shareholder Loan Agreement is a crucial financing instrument in Indonesian corporate practice, commonly used when companies require additional funding from their shareholders rather than external financial institutions. This document is particularly relevant in situations where traditional bank financing may be less favorable or unavailable, or when shareholders wish to maintain greater control over the company's debt structure. The agreement must comply with Indonesian law, particularly Law No. 40 of 2007 on Limited Liability Companies and relevant financial regulations. It typically includes detailed provisions on loan terms, interest rates, repayment schedules, and security arrangements if applicable. The document is especially important for foreign investment scenarios, where international shareholders provide financing to Indonesian companies, requiring careful consideration of foreign exchange regulations and cross-border transaction requirements.
