Loan Collateral Agreement Template for Indonesia

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Key Requirements PROMPT example:

Loan Collateral Agreement

"I need a Loan Collateral Agreement under Indonesian law for a manufacturing equipment security arrangement between PT Indo Manufacturing (borrower) and Bank Central Asia (lender), with the loan value of IDR 5 billion to be disbursed in March 2025."

Document background
The Loan Collateral Agreement is a crucial document in Indonesian secured lending transactions, used when a lender requires security over assets to protect their interests in a loan arrangement. This document type is governed by Indonesian law, particularly the Civil Code and Law No. 42 of 1999 on Fiduciary Security, and must comply with local registration requirements. The agreement details the security arrangement, including precise descriptions of the collateral, the secured obligations, and the rights and responsibilities of all parties. It's essential for various financing transactions, from simple bilateral loans to complex corporate financing arrangements, and must be properly executed and registered to create an enforceable security interest. The document typically requires notarization and registration with the Fiduciary Registration Office to be fully effective under Indonesian law.
Suggested Sections

1. Parties: Identification of the lender (secured party) and borrower (security provider), including their full legal names, addresses, and company registration details if applicable

2. Background: Recitals explaining the context of the loan agreement and the purpose of this security arrangement

3. Definitions and Interpretation: Definitions of key terms used in the agreement and rules for interpreting the document

4. Grant of Security Interest: The formal creation and grant of the security interest over the collateral

5. Description of Secured Obligations: Details of the underlying loan and other obligations being secured

6. Description of Collateral: Comprehensive description of the assets being provided as collateral

7. Representations and Warranties: Statements by the security provider about their ownership and right to grant security over the collateral

8. Security Provider's Obligations: Ongoing obligations regarding maintenance, insurance, and preservation of the collateral

9. Rights and Remedies of Secured Party: The lender's rights in case of default, including enforcement procedures

10. Registration and Perfection: Requirements and procedures for registering the security interest

11. Events of Default: Circumstances that constitute default under the agreement

12. Duration and Release: Term of the security interest and conditions for its release

13. Notices: Process for formal communications between parties

14. Governing Law and Jurisdiction: Confirmation of Indonesian law as governing law and jurisdiction for disputes

15. Execution: Signature blocks and execution formalities

Optional Sections

1. Further Assurance: Additional obligations to execute documents or perform actions to perfect the security - include when complex collateral requiring multiple registrations

2. Power of Attorney: Appointment of the secured party as attorney for specific purposes - include when enforcement may require specific actions by the lender

3. Insurance: Detailed insurance requirements - include when collateral requires specific insurance coverage

4. Negative Pledge: Prohibition on creating additional security interests - include for high-value or critical collateral

5. Third Party Rights: Provisions regarding rights of third parties - include when collateral may be subject to other claims

6. Currency Provisions: Exchange rate and currency provisions - include when loan and collateral are in different currencies

7. Tax Provisions: Allocation of tax liabilities - include when security creation or enforcement may have tax implications

Suggested Schedules

1. Schedule 1 - Collateral Description: Detailed technical or legal description of all collateral assets

2. Schedule 2 - Secured Obligations: Details of the underlying loan agreement and other secured obligations

3. Schedule 3 - Form of Notice: Standard forms for various notices required under the agreement

4. Schedule 4 - Registration Requirements: Specific requirements for registering the security interest with relevant authorities

5. Schedule 5 - Insurance Requirements: Detailed insurance requirements and approved insurers

6. Appendix A - Required Documents: List of documents required for perfection of security

7. Appendix B - Form of Power of Attorney: Standard form of power of attorney if required

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

Relevant legal definitions
Clauses
Relevant Industries

Banking & Financial Services

Real Estate

Manufacturing

Agriculture

Mining

Transportation & Logistics

Retail & Consumer Goods

Technology

Infrastructure

Energy

Healthcare

Construction

Maritime & Shipping

Small & Medium Enterprises

Relevant Teams

Legal

Finance

Risk Management

Compliance

Credit Administration

Corporate Secretariat

Treasury

Business Development

Loan Operations

Documentation

Relevant Roles

Chief Financial Officer

Finance Director

Legal Counsel

Corporate Lawyer

Risk Manager

Credit Manager

Loan Officer

Compliance Officer

Corporate Secretary

Treasury Manager

Financial Controller

Business Development Manager

Relationship Manager

Security Documentation Specialist

Credit Analyst

Legal Documentation 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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