With a loan agreement, one company (lender) gives another company (borrower) a loan and the borrower is obliged to repay it to the lender with the accrued interests at the time indicated in the agreement.

In which cases can the loan agreement template be used?
Based on this template, the lender and borrower are both companies. The same template can be used for granting a loan between individuals. However, if you wish to conclude a loan agreement in which the lender is a company and borrower an individual, requirements for consumer credits set out in the Law of Obligations Act must be applied. To have such loan agreement prepared, please contact our lawyers.

What are the limitations for granting loans between companies?
According to the Commercial Code, companies are not allowed to grant loans to certain persons. They are:

• company shareholders who hold more than 5% of a private limited company or 1% of a public limited company, respectively;
• in case of a lender who is a private limited company, shareholders and members of the parent company who hold more than 5% of the parent company;
• in case of a lender who is a public limited company, shareholders and members of the parent company who hold more than 1% of the parent company;
• persons whose aim when taking the loan is to acquire a share or stocks of the company;
• members of board and council, and the procurator.

There is an exception to the above in terms of a group’s internal lending where a subsidiary may grant a loan to their parent company or its shareholder, but only if the lending does not harm the subsidiary’s financial status and interests of debtors.

What is suitable as a guarantee for the loan?
A normal guarantee may be real estate (e.g. a property or right of superficies), surety and guarantee. It is also possible to set a commercial pledge (it is a pledge for the entire movable property of the company), a pledge on securities (e.g. shares of a private limited company, stock of a public limited company), cars and other assets on which the parties may agree. Some pledge agreements must be notarised (mortgage, commercial pledge), in the case of some, an agreement in an unattested written form (guarantee, surety) will suffice. More information on various pledges can be obtained from our lawyers.