Bridge Loan Promissory Note for Australia

Bridge Loan Promissory Note Template for Australia

A Bridge Loan Promissory Note is a formal financial instrument used in Australian jurisdiction that documents a temporary financing arrangement between a lender and borrower. The document outlines the terms and conditions of a short-term loan intended to provide interim financing until permanent financing or the next stage of financing is obtained. Governed by Australian law, particularly the National Consumer Credit Protection Act 2009 and related regulations, this document includes key provisions regarding loan amount, interest rate, repayment terms, security arrangements, and default conditions. It serves as legally binding evidence of debt and incorporates specific requirements of Australian financial services law.

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What is a Bridge Loan Promissory Note?

The Bridge Loan Promissory Note is a crucial document in Australian financial transactions where temporary financing is required to bridge a gap between two credit facilities or funding events. This document type is commonly used in situations where a borrower needs immediate funding while awaiting long-term financing, asset sale proceeds, or other anticipated income. The note must comply with Australian financial services regulations and typically includes detailed terms about the loan amount, interest calculations, repayment schedule, and any security arrangements. As a Bridge Loan Promissory Note, it specifically addresses the temporary nature of the financing and often contains provisions for mandatory repayment upon the occurrence of specified events, such as the receipt of permanent financing. The document is particularly relevant in real estate transactions, corporate acquisitions, and other situations requiring interim financing solutions in the Australian market.

What sections should be included in a Bridge Loan Promissory Note?

1. Parties: Identifies the lender and borrower with full legal names and addresses

2. Background: Explains the context of the bridge loan and its purpose

3. Definitions: Defines key terms used throughout the note

4. Loan Amount and Purpose: Specifies the principal amount and permitted use of funds

5. Interest Rate: Details the applicable interest rate, calculation method, and payment frequency

6. Repayment Terms: Specifies the repayment schedule, maturity date, and payment methods

7. Bridge Loan Nature: Explains the temporary nature of the loan and conditions for refinancing or repayment

8. Events of Default: Lists circumstances constituting default and consequences

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

10. Covenants: Ongoing obligations of the borrower during the loan term

11. Notices: Requirements for formal communications between parties

12. Governing Law: Specifies Australian law as governing law and jurisdiction

What sections are optional to include in a Bridge Loan Promissory Note?

1. Security: Details of any collateral or security interests - include if loan is secured

2. Guarantees: Terms of any personal or corporate guarantees - include if guaranteed

3. Prepayment Provisions: Terms for early repayment including any penalties - include if early repayment is restricted

4. Conditions Precedent: Conditions that must be met before loan funding - include if specific conditions exist

5. Agent Provisions: Terms governing the relationship with any facility agent - include for multiple lenders

6. Registration Requirements: PPSR and other registration requirements - include for secured loans

7. Insurance Requirements: Required insurance coverage for secured assets - include for secured loans

8. Subordination Provisions: Terms regarding priority of debt - include if other creditors exist

What schedules should be included in a Bridge Loan Promissory Note?

1. Repayment Schedule: Detailed schedule of payment dates and amounts

2. Security Details: Description of security assets and PPSR registration details

3. Conditions Precedent Checklist: List of conditions to be satisfied before drawdown

4. Fee Schedule: Breakdown of all applicable fees and charges

5. Form of Drawdown Notice: Template for requesting loan disbursement

6. Form of Compliance Certificate: Template for periodic compliance certification

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Australia

Publisher

Genie AI

Document Type

Finance Agreement

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Real Estate

Construction

Property Development

Mining

Infrastructure

Manufacturing

Retail

Healthcare

Technology

Agriculture

Private Equity

Financial Services

Relevant Teams

Legal

Finance

Treasury

Credit

Risk Management

Compliance

Corporate Development

Real Estate

Investment

Banking

Operations

Relevant Roles

Chief Financial Officer

Finance Director

Treasury Manager

Financial Controller

Credit Manager

Legal Counsel

Corporate Lawyer

Loan Officer

Risk Manager

Compliance Officer

Investment Manager

Property Developer

Transaction Manager

Banking Executive

Private Equity Manager

Industries
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,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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