The Limited Recourse Loan Agreement is a sophisticated financing instrument used when lenders agree to limit their recovery rights to specific assets or cash flows rather than having full recourse to the borrower's entire asset base. This type of agreement is particularly common in project finance, where lenders look primarily to the project's assets and revenue streams for repayment. Under German law, these agreements must comply with the Bürgerliches Gesetzbuch (German Civil Code) and the Kreditwesengesetz (German Banking Act), while incorporating specific provisions for limited recourse structures. The document typically includes detailed provisions on the recourse assets, their management, cash flow mechanisms, and enforcement procedures, making it essential for project financing, asset-based lending, and structured finance transactions in the German market.

1. Parties: Identification of the lender(s) and borrower(s) with full legal names and registration details

2. Background: Context of the loan arrangement and brief description of the limited recourse nature

3. Definitions and Interpretation: Definitions of key terms and interpretation rules, including German law-specific terminology

4. The Facility: Details of the loan amount, purpose, and availability period

5. Limited Recourse Provisions: Core provisions limiting the lender's recourse to specific assets or cash flows

6. Drawdown Conditions: Conditions precedent and drawdown mechanics

7. Interest: Interest rate, calculation methods, and payment dates

8. Repayment and Prepayment: Repayment schedule, prepayment terms, and application of payments

9. Recourse Assets: Detailed description of the assets against which recourse is available

10. Representations and Warranties: Standard and specific representations regarding the recourse assets

11. Covenants: Borrower's obligations regarding the maintenance and handling of recourse assets

12. Events of Default: Default triggers and consequences, limited to the recourse assets

13. Enforcement: Procedures for enforcing against the recourse assets

14. Miscellaneous: Standard boilerplate provisions adapted for German law

15. Governing Law and Jurisdiction: German law as governing law and jurisdiction provisions