The On Demand Loan Agreement is designed for use in New Zealand lending transactions where flexibility in repayment timing is required. This document type is commonly used for business financing, short-term lending, and situations where the lender needs to maintain strong control over the lending arrangement. The agreement complies with New Zealand's regulatory framework, including the Credit Contracts and Consumer Finance Act 2003, Contract and Commercial Law Act 2017, and relevant financial services legislation. It contains essential provisions for loan disbursement, interest calculation, repayment mechanisms, borrower covenants, and enforcement rights, along with optional provisions for security interests and guarantees. The on-demand nature of the facility means the lender can require immediate repayment at any time, making it particularly suitable for short-term financing needs or where the lender requires enhanced control over the lending relationship.

1. Parties: Identifies and defines the Lender and Borrower with their full legal names and addresses

2. Background: Sets out the context of the loan agreement and the parties' intention to enter into the lending arrangement

3. Definitions and Interpretation: Defines key terms used throughout the agreement and establishes rules for interpreting the agreement

4. Loan Facility: Specifies the loan amount, purpose, and on-demand nature of the facility

5. Interest: Details the interest rate, calculation method, and payment requirements

6. Repayment: Specifies repayment terms, including the on-demand nature and any minimum payment requirements

7. Representations and Warranties: Contains borrower's confirmations about their financial status, capacity, and authority to enter into the agreement

8. Borrower Covenants: Sets out ongoing obligations of the borrower during the loan term

9. Events of Default: Lists circumstances that constitute default and trigger demand for immediate repayment

10. Enforcement: Details the lender's rights and remedies upon default or demand

11. Costs and Indemnities: Allocates responsibility for costs and provides for borrower indemnities

12. General Provisions: Contains standard contractual provisions including notices, amendments, and governing law