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Anyone willing to share intercompany loan agreement?

Stephen Glenn's Profile

Intercompany Loan AgreementIn need of a simple loan agreement to cover excess funds advanced to the parent company. Terms are open ended, no repayment terms defined. I appreciate anything you are able to share.


Elianna Dzubur
Title: Director of Finance
Company: TekTegrity
(Director of Finance, TekTegrity) |

I would very much appreciate this exact template as well!

Topic Expert
Keith Perry
Title: Director of Global Accounting
Company: Agrinos, Inc.
(Director of Global Accounting, Agrinos, Inc.) |


I've done a few of these things. Technically, you've got this covered in your question. It does not need to be complicated.

However, caution. Depending on the jurisdictions involved you may need to:
-Settle the debt periodically, or;
-Pay a specific (market) interest rate.
-Follow other specific country / state / treaty guidelines.
Otherwise it may get classed as a dividend or similar other problems. I've specifically run into this exact issue when a sub is loaning to the parent, which can be very touchy.

That being said:

"For the term [Dates], company A shall advance funds to company B.
[Comment on amount of funds, e.g., "Not to exceed to US$1B"]
[Comment on use of funds, e.g., "Working Capital"]
[Comment on repayment process, demand, etc. e.g., "B shall repay funds in full annually on (date)" or "Repayment shall be effected on 30 days notice by A"]
[Comment on draw-down process; "A shall remit requested funds on 30 days notice by (method) to (account) on demand from Officer B"]
[Comment on interest rate, interest payment etc, if any, e.g., "Interest of 1.5% shall accrue monthly based on the average preceding calendar month principal balance and be remitted quarterly to (account) within 30 days of the end of each calendar quarter and shall not be capitalized into the principal of the loan."]
[Comment on security, recourse, or related, if any]

Officer A
Officer B" (preferably not the same person)

Stephen Glenn
Title: Controller
Company: Pierre Frey, Inc.
(Controller, Pierre Frey, Inc.) |

Thanks Keith, much appreciated.

During year end audit, our accounting firm calculated the amount of statutory minimum interest that had to be charged at a rate of .25% (.0025). Not sure if that was federal or state (GA). They suggested the note could be used as supporting documentation should tax authorities want to treat the transfer as a distribution or dividend as you mention.


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