N.b. A loan agreement defines only the terms of a loan; To ensure the security of the amount borrowed, a separate agreement is also required. An obligation is a document that creates security. it secures a credit with the borrower`s assets. The Pari Passu clause requires the borrower to ensure that the lender`s rights in the loan agreement are at least at the same level as all other unsecured and unsubordinated liabilities of the borrower, so that the lender`s share of the borrower`s estate, in the event of liquidation, corresponds to that of all other unsecured and unsubordinated creditors. Since each loan is different and there is no standard loan model for all loans, this agreement was developed with the flexibility of the transaction in mind. It can be tailored to the particular circumstances and needs of the parties, and it is flexible for loans of all sizes and repayment terms of any complexity. This comprehensive model of loan agreements contains the terms of an agreement between two parties under which the lender lends the borrower a certain amount of money over a specified period of time. The agreement also contains provisions for the parties to decide whether the loan should be secured by a third party (the guarantor) and whether the loan is secured or not. A loan agreement, also known as a credit facility agreement, is a contract that defines the terms of a loan.

Whether you lend or lend money to protect and regulate the interests of both parties, it is important to define the terms of the loan from the outset using a loan agreement. A loan agreement with the guarantor gives the lender greater certainty that the loan will be repaid, since the bond guarantees payment on behalf of the borrower. This loan agreement - Pari Passu Ranking offers flexibility, as the parties involved can be individuals or companies. In other words, this loan agreement can be used for a loan to a business of another company or an individual. Please note that the Pari Passu clause also applies to secured facilities, regardless of unsecured debt. This is a guarantee that if the guarantee fails, the lender`s rights will be assessed by Pari Passu (to be matched) with the rights of the borrower`s unsecured creditors, and the clause will apply to existing and future obligations. Its relevance comes when there is a lack of security in implementation or if security is, for some reason, defective.