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The Line of Credit Promissory Note (Schuldschein) is a fundamental financing instrument in German banking practice, used to establish and document revolving credit facilities. This document type is particularly relevant when parties need a flexible financing arrangement that allows for multiple drawdowns up to a predetermined limit, while maintaining the formal requirements of German law. The document combines elements of traditional promissory notes with modern credit facility features, making it suitable for ongoing business financing needs. It includes detailed provisions for interest calculation, drawdown procedures, repayment terms, and any applicable security arrangements, all structured to comply with German banking regulations and civil law requirements. The document is typically used in commercial lending relationships, though it can also be adapted for sophisticated private lending arrangements where regulatory compliance and formal documentation are essential.

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

2. Background: Brief context of the credit facility and purpose of the promissory note

3. Definitions: Key terms used throughout the document

4. Credit Facility Details: Maximum credit amount, currency, and facility type specifications

5. Interest Provisions: Interest rate, calculation method, payment periods, and default interest

6. Drawdown Mechanics: Procedures and conditions for drawing down the credit line

7. Repayment Terms: Repayment schedule, prepayment provisions, and payment mechanics

8. Representations and Warranties: Basic statements about borrower's legal status and capacity

9. Events of Default: Circumstances that trigger default and consequences

10. Governing Law and Jurisdiction: Confirmation of German law governance and jurisdiction