Surabaya · East Java · Indonesia

Credit Agreement Lawyer Surabaya — Loan Documentation & Covenant Negotiation

A credit agreement allocates repayment, information, security, and default risk long before a borrower misses payment. Integra Law Office reviews and prepares loan documentation for lenders and corporate borrowers in Surabaya, with attention to how each clause works in ordinary operations and during stress.

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Strong credit documentation in East Java's financial centre.

Before signing a term sheet or facility agreement, confirm the commercial deal in one place: facility amount and purpose, drawdown conditions, pricing and fees, repayment profile, representations, covenants, events of default, cure rights, and lender remedies. A borrower should compare each undertaking against its cash flow, other facilities, shareholder arrangements, and planned transactions. A lender should ensure conditions can be evidenced and monitored rather than relying on broad language that is difficult to administer.

A facility commonly sits beside security deeds, support undertakings, corporate approvals, account-control arrangements, and intercreditor or subordination documents. Inconsistency between these instruments can complicate drawdown or later enforcement. For a multi-lender or cross-border transaction, define decision-making, payment waterfall, governing law, notice mechanics, and document language early. Prepare current corporate documents, board or shareholder approvals where required, financial information, ownership records, asset details, and existing debt documents for review.

When you need a credit agreement lawyer.

A company receives a lender's term sheet and needs to test financial covenants against forecasts and existing debt.
A lender is preparing a bilateral facility or a syndicated transaction with several finance parties.
A borrower seeks refinancing and needs to compare prepayment, break-cost, and release terms.
A proposed drawdown depends on permits, corporate approvals, collateral, or other conditions precedent.
An existing agreement contains a covenant that may restrict dividends, new borrowing, asset sales, or a change of control.
The parties need an intercreditor or subordination arrangement to coordinate payment priority and enforcement decisions.

Credit agreement law in Indonesia.

Credit documentation is principally contractual and must be read with Indonesia's Civil Code framework, corporate authority rules, and applicable financial-sector regulation. The regulatory position depends on whether the lender is a bank, finance company, or another type of creditor; do not treat every commercial loan as subject to the same OJK rule. Counsel should confirm the lender's regulatory status and the transaction-specific rules in force.

Security perfection requires separate steps. A fiduciary security deed and registration are governed by UU 42/1999; a land mortgage (Hak Tanggungan) follows UU 4/1996 and land-registration procedures. Signing the facility alone does not create every intended proprietary right. For corporate borrowers, authority, benefit, related-party issues, and existing security or negative pledges should be checked. If a dispute clause selects arbitration, the clause and institutional rules affect the forum and process.

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How we handle credit agreements.

We compare the commercial terms with the complete document suite, mark operational obligations, and identify points that require confirmation from finance, tax, company-secretarial, or security-registration teams. For lenders, the review focuses on authority, drawdown evidence, monitoring, collateral consistency, and workable default mechanics. For borrowers, it focuses on covenant capacity, reporting burden, permitted transactions, cure and waiver mechanics, and release obligations.

We prepare or negotiate clauses against the parties' actual transaction rather than importing a generic form. A closing checklist can track approvals, signatures, original documents, registrations, and conditions precedent. Final advice depends on the complete transaction record and applicable regulatory requirements; drafting cannot remove commercial credit risk.

Credit Agreement Services

Term sheet and facility agreement

Draft or review pricing, drawdown, repayment, representations, covenants, default, and remedy provisions.

Borrower covenant review

Map proposed restrictions against forecast cash flows, existing financing, and planned business activity.

Security and closing documents

Coordinate facility terms with fiduciary, mortgage, surety, approval, and registration documents.

Syndicated and intercreditor arrangements

Address lender voting, payment priority, enforcement coordination, and information sharing across finance parties.

Frequently Asked Questions

Should a borrower have separate counsel from the bank?

Separate counsel can review the lender's proposed documents from the borrower's perspective and explain obligations that may constrain operations or future financing. The bank's counsel is instructed to document and protect the bank's position. Each side should confirm its own authority, commercial objectives, and regulatory obligations.

Which documents help counsel review a facility?

Send the term sheet, draft facility and security documents, corporate constitutional documents, approvals, current financial statements and forecasts, existing debt and security documents, and relevant permits or asset records. Flag the intended use of funds and any expected refinancing, dividend, acquisition, or asset sale.

Can a covenant be negotiated after signing?

A change usually requires the consent mechanism set out in the executed agreement and a written amendment or waiver by the appropriate parties. A lender's informal discussion may not amend the contract. Check notice, voting, and form requirements before acting as if a restriction has changed.

What is the difference between a facility agreement and a security deed?

The facility agreement sets the lending and repayment obligations. A security instrument grants rights over specified assets and may require its own formalities and registration to be effective against third parties. The documents must align on the secured obligations, parties, asset description, and release process.

Request a credit agreement consultation.

Describe your credit agreement needs. A senior partner will respond within one business day.

info@integralaw.id

Jl. Juwono No.7-8, Darmo, Kec. Wonokromo, Surabaya