Letter Granting Naira Revolving Advance Facility
To- (name of borrower ) (address )
We are pleased to advise you that we are prepared to place at your disposal a facility not exceeding ... outstanding at any one time on the following terms and conditions:
1.Revolving advance facility
This facility is available by way of revolving advances in Naira. Advances shall be in amounts of not less than ... and for periods of one, 3 or 6 months (or such other periods as we may agree ) but are in all cases to mature on a day which is no later than the expiry date specified in clause 13 below and is a banking business day in Nigeria. No advance shall be made of an amount which would cause the amount of the facility specified above to be exceeded. We shall require your notification of the amount and of the period you select for each advance prior to 12 noon on the day each advance is made.
2.1 Interest will be calculated in respect of each advance on the basis of the number of days elapsed and a 365 day year at a rate per annum [of ... ) or to be advised to you prior to each advance] above the rate of interest (as conclusively determined by us ) at which we would offer Naira deposits of like amount and period to each advance to major banks in the Nigeria Interbank Market on the date of each advance.
2.2 Interest on each advance shall be paid at its maturity and, if the advance is for a period longer than 3 months, at 3-monthly intervals after the date of the advance.
3. Commitment fee
You shall pay to us a commitment fee calculated from and including the above date up to (but excluding ) the date falling one month before the expiry date specified in clause 13 below, at the rate of ... ) upon the amount (calculated on a daily basis ) by which the maximum amount available under this facility exceeds the aggregate amount of all advances outstanding. Such commitment fee shall be paid on the last banking business day of each successive period of 3 months and on the last day upon which such fee accrues.
4.Cancellation of facility
You shall be entitled to cancel the whole or any part (not being less than ... ) of this facility which is not at such time advanced and outstanding or the subject of a notification pursuant to clause 1 above or cancelled upon giving 7 days notice (which shall be irrevocable ).
All your obligations under this facility are to be unconditionally guaranteed at all times by (name of guarantor ) (`the Guarantor ) in a form and content satisfactory to us.]
6.Purpose of facility
This facility is to be used for (state purpose ).
7.Payments under facility
7.1 All payments to be made by you under this facility shall be made to us at (name of branch ) (or at such other office as we may notify to you from time to time ). All payments to be made to you under this facility shall be made to your account with us at (name of branch ) (or at such other office as we may from time to time agree ).
7.2 All payments by you under this facility are to be made in immediately available funds free and clear of and without any withholding or deduction for any and all present or future taxes duties or other charges unless you are compelled by law to make such withholdings or deductions. If you are compelled by law to make any such withholding or deduction you will pay to us such additional amounts as are required to enable us to receive the amount which we would have received if no such withholding or deduction had been required. You shall provide us with evidence that such taxes, duties or charges have been paid by forwarding to us official receipts within 30 days of payment.
7.3 You irrevocably authorise us to debit to any account you may have with us all or any amounts due to us in connection with this facility.
8. Availability of facility
The availability of this facility is at all times subject to our compliance in such manner as we think fit, with any and all restrictions, rules and regulations of the Central Bank of Nigeria or any other applicable regulatory authority from time to time in force.
9.Reimbursement of additional costs
You undertake to pay or reimburse to us, on demand, as additional interest the cost to us for the time being (as determined by us in our sole discretion ) of complying with any reserve, special deposit or any other requirements of the Central Bank of Nigeria or any other applicable regulatory authority as affecting transactions under this facility.
10 Prepayment of advance
In the event of any additional amounts becoming payable by you pursuant to clauses 7 and 9 above, you may, upon giving 3 days notice (which shall be irrevocable ) prepay the full amount of the advance[s] giving rise to such additional amounts.
11 Pari passu ranking of obligations
You undertake that your obligations under this facility will at all times rank at least pari passu with all your present and future obligations to other banks and financial institutions.
12 Provision of audited financial statements
You will provide us with your [and the Guarantors] annual audited financial statements within 180 days of your [or the Guarantors] financial year end and promptly with any other information which we may reasonably request.
13 Expiry of facility
13.1 This facility will expire on (date ). Whilst it is our present intention that this facility should remain available to you until that date and notwithstanding any other provision of this letter we nevertheless reserve the right to terminate the facility at any time by notice to you in writing. We shall have the right on such expiry or termination to demand immediate repayment of all outstanding advances together with payment of accrued interest and any other sums for which you are liable under this facility.
13.2 In the event that default is made in the payment of any sum due under this facility, interest shall accrue on the amount in respect of which such default has been made from the date of default until payment (as well after as before judgment ) at the rate of ... ) per annum above the cost to us, as conclusively determined by us, of acquiring such funds from such sources and for such periods as we may decide, and will be payable on demand.
14 Availability of facility and provision of documents
This facility will be available for advances when the following shall have been received by us and found to be satisfactory:
[(in the case of corporate borrowers )
14.1 a certified true copy of your certificate of incorporation [or other evidence of your Companys incorporation];
14.2 a copy certified to be a true, complete and up-to-date copy,[of your Companys memorandum and articles of association or of the instrument[s] containing your Companys constitution (eg charter, statutes, byelaws )];
14.3 a certified true copy of a resolution of your Board of Directors authorising:
14.3.1 acceptance of the facility on the terms and conditions set out in this Letter;
14.3.2 an officer of your Company to sign the enclosed duplicate of this Letter indicating such acceptance;
14.3.3 a person or persons to operate the facility (and enclosing specimen signatures );
(in all cases )
14.4 a guarantee in our favour executed by the Guarantor,[(in the case of a corporate guarantor ) together with evidence that it has been duly authorised by and agreed on behalf of the Guarantor];
14.5 the enclosed signed duplicate of this letter indicating your acceptance of the facility on the terms and conditions set out in this letter;
(in the case of a corporate guarantor )
14.6 a copy certified to be a true, complete and up-to-date copy [of the Guarantors memorandum and articles of association or of the instrument[s] containing the Guarantors constitution (eg charter, statutes, byelaws )].
(or as the case may be )]
We look forward to your reply and to receipt of the documents called for above. If we have not received your reply and satisfactory documents on or before (date ) the offer constituted by this letter will lapse.