Finance Agreement Document

A Finance Agreement is a document which establishes a legal binding agreement between a company receiving funds (financing) and financer. It states a formal commitment on the part of the Financer to provide funding to the financed company over a fixed period of time in return of the initial amount paid and interest payments. The purpose of the Agreement is to help the financed company for promoting and expanding its business by providing funds as and when required. It includes all the terms and conditions and legal points that form a part of the agreement and should be understood by both the parties.

Sample Finance Agreement Document

Name of the borrower: Atlanta Sweets

Prepared by: Mr. Henry, Finance Manager                   

Date of drafting of financial support document: May 21, 2012

Name of the Finance company: U.S. Finance

Approved by: Mr. Texan, Senior Financial analyst

Date of approval of finance support document: May 25, 2012

Rate of Interest: 9.5% per annum

Significant features of Finance Agreement Document

  • The borrower company, henceforth known as the financed company, is indebted to the lender, henceforth known as the Financer in the amount financed over a period of five years till May 24, 2017 with rate of interest of 9.5% p.a. payable.
  • The financed company has approached the financer officially to look after its finance department and its proceedings and give required advice as and when required for the financial improvement and development of the organization.
  • The main reason behind signing this financial agreement is to hand over the responsibility of managing the finances of a huge company to the financer where capital is safe and investments profitable.
  • The document has been signed under the major condition that the financial weaknesses and strengths of the enterprise will be indentified and necessary steps will be taken accordingly.

Posted in Financial Documents