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Term Loan Agreement for the United States

Term Loan Agreement Template for United States

A Term Loan Agreement is a legally binding contract under U.S. law that establishes the terms and conditions for a fixed-term loan between a lender and borrower. The agreement specifies the loan amount, interest rate, repayment schedule, and maturity date, along with various covenants, representations, warranties, and events of default. It includes provisions for security interests, if applicable, and operates within the framework of federal and state lending regulations.

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Term Loan Agreement

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What is a Term Loan Agreement?

The Term Loan Agreement is a fundamental financing document used when a borrower needs to secure fixed-term funding for specific purposes such as capital expenditure, acquisition financing, or general corporate purposes. This agreement, governed by U.S. law, comprehensively details the rights and obligations of all parties, including loan terms, security arrangements, representations, warranties, and covenants. It incorporates relevant federal and state regulatory requirements, including usury laws and consumer protection provisions, and can be adapted for various transaction sizes and complexities.

What sections should be included in a Term Loan Agreement?

1. Parties: Identification of lender(s) and borrower(s), including full legal names and addresses

2. Background: Recitals explaining the context and purpose of the loan

3. Definitions: Key terms used throughout the agreement

4. Loan Amount and Terms: Principal amount, interest rate, maturity date, and repayment schedule

5. Conditions Precedent: Conditions that must be satisfied before loan disbursement

6. Representations and Warranties: Borrower's statements about its legal and financial condition

7. Covenants: Ongoing obligations of the borrower (positive and negative)

8. Events of Default: Circumstances constituting default and consequences

9. Miscellaneous: Standard legal provisions including notices, amendments, governing law

What sections are optional to include in a Term Loan Agreement?

1. Security: Details of collateral and security arrangements for secured loans

2. Guarantees: Terms of any guarantees provided by third-party guarantors

3. Subordination: Priority of the loan relative to other debt when there are multiple creditors

4. Tax Provisions: Allocation of tax obligations and withholding requirements for cross-border loans or complex tax situations

What schedules should be included in a Term Loan Agreement?

1. Repayment Schedule: Detailed amortization table showing payment dates and amounts

2. Form of Draw Down Notice: Template for borrower to request loan disbursements

3. Security Documents: Details of collateral and security arrangements

4. Financial Covenants Schedule: Specific financial ratios and thresholds to be maintained

5. Permitted Liens: List of pre-approved encumbrances on assets

6. Required Insurance: Schedule of insurance policies to be maintained

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 | Serial Founder & Legal AI Author

Jurisdiction

United States

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Clauses






























Industries

Truth in Lending Act (TILA) and Regulation Z: Federal law requiring disclosure of credit terms and standardizing how costs associated with borrowing are calculated and disclosed

Equal Credit Opportunity Act (ECOA): Federal law that prohibits discrimination in lending based on race, color, religion, national origin, sex, marital status, age, or public assistance status

Fair Credit Reporting Act (FCRA): Federal law governing the collection, dissemination, and use of consumer credit information

Dodd-Frank Wall Street Reform: Comprehensive federal law reforming financial regulation, including consumer protection provisions and establishing the CFPB

Bank Secrecy Act (BSA): Federal law requiring financial institutions to assist government agencies in detecting and preventing money laundering

USA PATRIOT Act: Federal law establishing requirements for customer identification and verification in financial transactions

State Usury Laws: State-specific laws that set maximum interest rates and regulate other loan charges

Securities Acts: Federal laws (1933 and 1934 Acts) governing securities transactions and ongoing reporting requirements if the loan is deemed a security

Bankruptcy Code: Federal laws governing bankruptcy proceedings and creditors' rights in case of borrower default

Uniform Commercial Code (UCC): State-adopted uniform laws governing commercial transactions, particularly Article 9 for secured lending

LIBOR Transition Regulations: Regulations governing the transition from LIBOR to alternative reference rates in loan agreements

Consumer Financial Protection Bureau (CFPB) Regulations: Federal regulations specifically focused on consumer protection in financial products and services

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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