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The Unsecured Loan Note is commonly used in German business practice for documenting loan arrangements where no specific security is provided by the borrower. This document type is particularly relevant when companies require financing but either cannot or choose not to provide collateral, or when the lender is comfortable with the borrower's creditworthiness without security. The document must comply with German legal requirements, particularly the provisions of the German Civil Code (BGB) regarding loan agreements and general contract law. It includes detailed provisions on loan terms, interest calculations, repayment schedules, events of default, and enforcement mechanisms. The note is typically used for corporate financing, working capital needs, or specific project financing where the lender relies on the borrower's general creditworthiness rather than specific assets.

1. Parties: Identification of the lender and borrower with full legal names and addresses

2. Background: Context of the loan agreement and brief description of the parties' intentions

3. Definitions and Interpretation: Definitions of key terms used in the note and interpretation rules

4. Loan Amount and Purpose: Specification of the principal amount and permitted use of the loan proceeds

5. Interest: Interest rate, calculation method, and payment dates

6. Repayment Terms: Schedule and method of repayment, including any installment provisions

7. Payment Mechanics: Details of payment method, account information, and currency

8. Representations and Warranties: Standard representations by the borrower about their legal status and capacity

9. Information Undertakings: Borrower's obligations to provide financial and other information

10. General Undertakings: Borrower's general obligations during the term of the loan

11. Events of Default: Circumstances constituting default and consequences

12. Changes to Parties: Rules regarding assignment and transfer rights

13. Notices: Communication methods and contact details

14. Miscellaneous: Standard boilerplate provisions including severability and amendments

15. Governing Law and Jurisdiction: Confirmation of German law governance and jurisdiction for disputes