The Tripartite Loan Agreement is a sophisticated financial instrument used in the Indian legal framework when a loan transaction requires the involvement of three parties. This document is typically employed when additional security or support is needed for a loan facility, such as when a parent company guarantees a subsidiary's loan, when collateral is provided by a third party, or in project finance scenarios where multiple stakeholders are involved. The agreement comprehensively addresses the rights, obligations, and relationships between the lender (usually a financial institution), the borrower, and the third party, while ensuring compliance with Indian banking regulations, the Indian Contract Act, and other relevant legislation. It includes detailed provisions for loan disbursement, repayment terms, security enforcement, default remedies, and the specific roles of each party, making it essential for structured financing transactions in India.

1. Parties: Identifies and defines the three parties to the agreement - typically the Lender, Borrower, and Third Party (e.g., Guarantor/Security Provider)

2. Background: Provides context for the agreement, including the purpose of the loan and the role of each party

3. Definitions and Interpretation: Defines key terms used throughout the agreement and sets out rules of interpretation

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

5. Conditions Precedent: Lists conditions that must be satisfied before loan disbursement

6. Disbursement Terms: Details the mechanism and conditions for disbursement of the loan

7. Interest and Fees: Specifies interest rate, calculation method, payment periods, and applicable fees

8. Repayment Terms: Sets out the repayment schedule, prepayment provisions, and payment mechanics

9. Security: Details the security/collateral arrangements and third party obligations

10. Representations and Warranties: Contains statements of fact and assurances from all parties

11. Covenants: Lists positive and negative obligations of the parties during the loan term

12. Events of Default: Defines circumstances constituting default and consequences thereof

13. Rights and Obligations of Third Party: Specific provisions relating to the third party's role and responsibilities

14. Indemnification: Covers indemnity obligations of the parties

15. Governing Law and Jurisdiction: Specifies applicable law and courts having jurisdiction

16. Notices: Sets out process for formal communications between parties

17. Miscellaneous: Includes standard boilerplate provisions like amendments, severability, etc.