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Finance Agreement Template for Netherlands

A comprehensive financing document governed by Dutch law that establishes the terms and conditions under which a lender provides financial facilities to a borrower. The agreement incorporates key Dutch legal requirements and financial regulations, including compliance with the Financial Supervision Act (Wft) and relevant EU regulations. It details all aspects of the lending relationship, including facility terms, drawdown mechanisms, repayment obligations, security arrangements, representations, warranties, and covenants. The document ensures compliance with Dutch banking regulations while providing clear mechanisms for facility utilization and risk management.

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What is a Finance Agreement?

The Finance Agreement serves as the primary document governing financial facilities provided by lenders to borrowers in the Netherlands. It is essential for various financing transactions, including corporate loans, asset financing, project finance, and working capital facilities. The agreement must comply with Dutch legal requirements, particularly the Civil Code (Burgerlijk Wetboek) and Financial Supervision Act (Wft), while also considering relevant EU regulations. This document typically includes detailed provisions on facility terms, security arrangements, conditions precedent, representations and warranties, covenants, and events of default. The Finance Agreement is crucial for establishing clear rights and obligations of all parties involved in the financing transaction, while ensuring regulatory compliance and risk management. It is particularly important in secured lending transactions and can be adapted for both bilateral and syndicated lending arrangements.

What sections should be included in a Finance Agreement?

1. Parties: Identification of the parties entering into the agreement, including full legal names and registration details

2. Background: Context of the agreement and brief description of the transaction

3. Definitions and Interpretation: Detailed definitions of terms used throughout the agreement and rules of interpretation

4. The Facility: Details of the financial facility, including amount, purpose, and availability

5. Conditions Precedent: Conditions that must be satisfied before the facility becomes available

6. Drawdown: Procedures and requirements for drawing down the facility

7. Interest and Fees: Interest rates, calculation methods, and all applicable fees

8. Repayment and Prepayment: Terms for scheduled repayments and voluntary/mandatory prepayments

9. Representations and Warranties: Statements of fact and assurances given by the borrower

10. Covenants: Positive and negative obligations of the borrower during the facility period

11. Events of Default: Circumstances that constitute default and consequences thereof

12. Changes to Parties: Rules regarding assignment, transfer, and succession

13. Notices: Communication procedures between parties

14. Miscellaneous: General provisions including severability, amendments, and governing law

15. Governing Law and Jurisdiction: Confirmation of Dutch law governance and jurisdiction arrangements

What sections are optional to include in a Finance Agreement?

1. Security: Required when the facility is secured, detailing all security arrangements and enforcement rights

2. Guarantee: Needed when third-party guarantees are part of the transaction

3. Syndication Provisions: Required for syndicated facilities, including agency and voting provisions

4. Tax Provisions: Detailed tax clauses needed for cross-border transactions or specific tax arrangements

5. Market Disruption: Required for facilities with variable interest rates, addressing market disruption scenarios

6. Increased Costs: Required when lender needs protection against regulatory changes affecting costs

7. Anti-corruption Provisions: Detailed provisions required for international transactions or high-risk sectors

8. Sanctions Compliance: Required when there are international parties or cross-border elements

What schedules should be included in a Finance Agreement?

1. Schedule 1 - Conditions Precedent Documents: List of all required documents and conditions to be satisfied

2. Schedule 2 - Form of Drawdown Request: Standard form for requesting drawdowns under the facility

3. Schedule 3 - Repayment Schedule: Detailed schedule of repayment dates and amounts

4. Schedule 4 - Form of Compliance Certificate: Template for periodic compliance certification

5. Schedule 5 - Security Documents: List and copies of all security documents (if applicable)

6. Schedule 6 - Financial Covenants Calculations: Detailed methodology for calculating financial covenants

7. Appendix A - Contact Details: Contact information for all parties and authorized representatives

8. Appendix B - Fee Schedule: Detailed breakdown of all applicable fees and charges

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

Netherlands

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use

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