The Initial Borrowings Clause Samples

The Initial Borrowings clause defines the terms and conditions under which a borrower may first draw funds under a loan agreement. Typically, it specifies the maximum amount available for the initial borrowing, the process for requesting the funds, and any conditions precedent that must be satisfied before the lender disburses the money. For example, the borrower may need to provide certain documents or meet specific financial covenants before accessing the initial loan amount. This clause ensures that both parties are clear on the requirements and procedures for the first disbursement, thereby reducing misunderstandings and managing risk at the outset of the lending relationship.