Document background
The Loan Note serves as a formal debt instrument under South African law, commonly used to document medium to long-term financing arrangements between parties. It is particularly valuable when a structured financing approach is needed, offering more formality than a simple loan agreement while being more straightforward than a bond issuance. The Loan Note must comply with South African financial regulations, including the National Credit Act 34 of 2005 and the Companies Act 71 of 2008, and typically includes detailed terms regarding the principal amount, interest calculations, repayment schedule, events of default, and enforcement mechanisms. This document type is especially useful for corporate financing, project funding, or structured lending arrangements where a transferable or registrable debt instrument is preferred over a conventional loan agreement.
