Loan Agreement
Content
LOAN AGREEMENT THIS LOAN AGREEMENT is made the day of , 200… BETWEEN ……………………………………………………………………………….. of …………………………… ……………………………………………………………………………………………………………. (address) (hereinafter referred to as “the Borrower” which expression shall where the context so admits include personal representatives, heirs and assigns) of the one part AND SKYE BANK PLC, a commercial bank incorporated and licensed in Nigeria and having its registered office at 3 Akin Adesola Street, Victoria Island, Lagos (hereinafter referred to as “the Bank” shall where the context so admits include its successors in title and assigns) of the other part. WHEREAS: 1. The Borrower has applied to the Bank for a facility in the sum of ……………………………………………………………………………………….. (……………………………………………………………………………………………………………… …. only) for the purpose stated in the offer letter dated …………………………. 2. The Bank has agreed to grant the facility subject to the terms herein contained and the terms of its offer letter stated above which is hereby incorporated by reference. NOW THIS DEED WITNESSES AS FOLLOWS: 1. DEFINITIONS: In this Agreement except the context otherwise admits, the expressions: “Advance” means any principal amount advanced to the Borrower under the Facility as from time to time reduced by repayment and prepayment hereunder. “Loan/ Facility” means the Facility granted under this agreement. 2. LOAN: The Bank hereby grants to the Borrower and the Borrower hereby accepts the Facility upon the terms and subject to the conditions contained in this Agreement and in the offer letter stated above which is hereby incorporated by reference in this agreement. The Bank however reserves the right to cancel and or reduce the facility in line with its ability to accommodate it within its legal lending limits and / or policy or portfolio constraints 3. SECURITY: The security for this loan shall be as set out in the offer letter. 4. CONDITIONS PRECEDENT TO DRAWDOWN:
5. REPRESENTATIONS AND WARRANTIES: The Borrower hereby makes the following covenants, representations and warranties in favour of the Bank: a. The Borrower has the power to enter into and perform this Agreement and to borrow hereunder and has taken all necessary action to authorize the borrowing of this facility upon the terms and conditions of this Agreement and to authorize the execution, delivery and performance of this Agreement in accordance with its terms. b. That all consents, licenses, approvals, or authorizations of any governmental authority, bureau or agency required in connection with the execution, delivery, performance, validity or enforceability of this Agreement have been obtained and are valid and subsisting. c. That all information relating to the Borrower or otherwise relevant to the matters contemplated by this Agreement which has been supplied to the Bank by the Borrower is true and correct in all material respects and contains no material omission. 6. DRAW DOWN: The draw down on the facility may be made at any time, as agreed between the parties from the date of satisfactory completion of all required documentation and satisfaction of all conditions precedent to drawdown as specified in the Offer Letter and such further conditions as may be communicated by the Lender, but subject to the right of the Bank to cancel and or reduce the facility in line with its ability to accommodate it within its legal lending limits and / or policy or portfolio constraints. 7. TENOR: The Facility shall be for the tenor stated in the offer letter from the date of acceptance of the offer subject to review by the Lender and notification to the Borrower. It may be renewed at the end of the tenor at the discretion of the Lender and upon renewal the same terms and conditions contained in this Agreement shall govern the renewed Agreement. 8. INTEREST PAYMENT AND CAPITALIZATION:
The obligation of the Bank to advance the loan to the Borrower under this agreement is conditional upon the provision of the documents stated in the offer letter and other documents required by the Bank.
date same became payable to the date on which it is in fact paid and may at the sole discretion of the Bank be at any time capitalized and added for all purposes to the facility hereby secured and bear interest accordingly until actually paid and all overdue interests shall be secured in the same manner as the facility and all covenants, provisions and remedies contained in and conferred by this Agreement and all rules of law and equity in relation to the facility and the interest thereon shall equally apply to such overdue amounts and to the interest thereon.
9. PREPAYMENTS AND CANCELLATIONS: a) The Borrower may at any time elect to prepay the Loan or any part thereof in such amount of money as is agreeable to the Bank by giving the Bank 7 (seven) days notice of such election without any penalty, failing which a penalty as determined by the Bank shall apply on such pre-paid amount. b) Any exercise of the power of election under Clause 9 a) hereof shall oblige the Borrower to pay to the Bank on the date of such prepayment for account of the Bank the principal outstanding amount of such facility together with interest and fees during the period between the last interest payment date applicable to it and the date of prepayment. c) Any notice given under this Clause shall be irrevocable and shall commit the Borrower to pay to the Bank the amount therein stated on the stated date d) No amount prepaid under this clause shall be available for redrawing. Amounts prepaid under this Clause shall reduce the Borrower’s repayment obligations under this Agreement, such prepaid installment shall be applied to the furthermost maturities. 10. REPAYMENT SCHEDULE: Repayment of the principal sum and interest and all usual commissions and bank charges and all costs and expenses shall be as expressly agreed by both parties. The Borrower shall ensure that all payments are made to the Bank’s Head Office or any branch specified by the Bank during business hours on the agreed due dates.
11. TAXES: All payments, whether principal, interest or otherwise, to be made by the Borrower to the Bank, shall be made free and clear of and without deduction of any taxes, duties, with the prevailing money market conditions, set-offs, rate shall be as In line charges, fees, deductions, withholdings, interest counterclaims or restrictionsin the offer letter, which shall be reviewed from time to time. Any of any nature. contained change in the pricing of this facility notified by the Lender to the Borrower shall be Where by any law or regulation, the Borrower shall be required to deduct or binding on the parties. In the event that the Borrower rejects the change in the withhold any sum from the total sum or any installment payable to the Bank, the pricing of the facility as notified to it by the Lender, the facility together with all Borrower undertakes to pay such additional amounts as may be necessary to interest, charges and banker’s fees thereon shall immediately become payable by ensure that the Bank receives a net amount equal to the full amount which the the Borrower. Bank would have received had such deductions or withholding taxes not been made by the Borrower. If any principal or interest or installment required by this Agreement to be paid 12. shall remain unpaid the day after the same ought to have been paid, then without CHANGE IN CIRCUMSTANCES: prejudice to any or all of the rights and remedies accruing to the Bank consequent upon such default, the amount so in arrears shall thenceforth itself bear interest at the rate of default stated in the offer letter computed from the
illegal for the Borrower to perform its obligations hereunder then and in any such situation: i. the available facility shall be automatically cancelled and the Bank’s commitment shall be reduced to zero. ii. The Borrower shall repay to the Bank the outstanding principal amount of the facility together with accrued interest thereon and any accrued but unpaid commissions and other costs and charges payable hereunder. b) If any change in law or administrative regulations applicable to this Agreement or any interpretation by the courts of law make it unlawful or illegal for the Lender to perform its obligations hereunder then and in any such situation: i. The Lender shall be discharged from all obligations towards the Borrower hereunder and its commitment reduced to zero. ii. The yet un-drawn portion of the Loan shall be reduced by the amount of the Bank’s commitment immediately prior to the occurrence of such event and the Borrower shall on demand pay to the Bank its outstanding advance on the next interest payment date relating thereto. 13. COVENANTS: For the duration of the agreement, the Borrower shall: a) insure and keep insured with an insurance company acceptable to the Bank all its property and effects of all description which are usually insured to the full insurable value thereof against fire, earthquake, tornado, strikes, riots, burglary and malicious damage by a policy noting the interest of the Bank on the Policy. All moneys which may at any time hereafter be receivable under any risks as aforesaid shall be applied in replacing, restoring or reinstating the property destroyed or damaged towards the discharge of the facility and other monies hereby covenanted to be paid as the Bank may require PROVIDED ALWAYS that if the Borrower shall fail to pay the insurance premium on the property the Bank reserves the right to pay the premium and debit the Borrower’s account accordingly.
a) If any change in law or administrative regulations applicable to this Agreement or any interpretation by the courts of law make it unlawful or
d. If any encumbrancer takes possession of or a receiver or other similar officer is appointed for all or any part of the undertaking and assets of the Borrower; e. If the Borrower commits any breach of this Agreement and in the case of any breach capable of remedy fails to remedy the breach within 7 (Seven) days of being required in writing by the Bank to do so; f. If there should in the opinion of the Bank be a material adverse change in the financial condition of the Borrower; g. If any Government consent required by law for the validity, enforceability or legality of this Agreement and the securities hereunder or the performance thereof ceases to be or is not for any reason in full force and effect; h. If any representation or warranty made by the Borrower in this Agreement or in any notice, certificate or statement delivered or made hereunder proves to have been incorrect or materially inaccurate when made or i. If delivered;or shall be in default of any payment obligation to any person or the Borrower group of persons or organization whether such default is waived or not. 15. REMEDIES AND WAIVERS: No failure to exercise or delay in exercising on the part of the Bank any right, power or remedy hereunder shall operate as a waiver thereof nor shall any single or partial exercise of any right, power or remedy prevent any further or other exercise thereof or the exercise of any other right, power or remedy. The rights and remedies herein provided are cumulative and not exclusive of any rights or remedies provided by law. 16. BENEFIT OF AGREEMENT: This Agreement shall be binding upon the Borrower and its successors in title and assigns and shall inure to the benefit of the Bank and its successors in title and assigns, provided that the Borrower may not assign or transfer any of its rights and benefits hereunder save with the prior written consent of the Bank. The Bank may at any time with written notice to the Borrower assign all or any part of its rights and benefits hereunder to any one or more banks or other lending institutions (each of which is hereinafter called a “Participant”) upon the consideration that each Participant shall perform that percentage of the Bank’s right and benefits assigned to such Participant and for this purpose, the Bank may disclose such information about the b) not to mortgage, pledge or appropriate. Borrower as the Bank shall considersubject to any lien or encumbrance property and assets now owned without either securing the Bank’s outstanding on a pari- passu basis or giving other security acceptable to the Bank. 17. c) not take on any additional loan or borrowing or incur any other debt without the COSTS, EXPENSES & FEES: prior written consent of the Bank which consent shall not be unreasonably Thewithheld. shall from time to time at the request of the Bank reimburse the Bank for Borrower all out of pocket expenses including legal fees, stamp duties and registration fees 14. EVENTS OF DEFAULT: reasonably incurred by it in the processing of the loan, the administration or enforcement of this agreement or in recovery of the loan in the event of default oror Without prejudice to the Bank’s right to demand payment of any outstanding sum, in the preservation, protection and enforcement of its rights hereunder. The Borrower reduce or cancel the facility at any time, the facility or the balance of the facility for also agrees to pay the Bank plus interest in the aforementioned rate the time being outstandingfees as set out at the accepted offer letter. shall become repayable upon occurrence of any of the following events: 18. NOTICES: a. If the Borrower fails to pay any sum hereunder when due; b. If the Borrower stops repayment and/or operating of the account; c. If any distress execution, sequestration or other process is levied or enforced upon or issued out against the property of the Borrower and is not discharged within 7 (Seven) days;
19. SET-OFF: The Borrower agrees that the Bank shall have the right to combine or consolidate all or any of the Borrower’s deposits and accounts, set off or transfer any sum or sums standing to the credit of any one or more such accounts towards the satisfaction of all amounts which may become payable to the Bank hereunder.
This Agreement shall be governed by and construed in accordance with the laws of the Federal Republic of Nigeria. 21. AMENDMENTS: This Agreement shall not be amended except by a document signed and sealed by both parties hereto.
22. COMMENCEMENT:
Any notice shall be sufficiently given provided it is in writing and given under the hand of any Manager or Officer of the Bank and sent by post or courier, addressed to the Borrower and every such notice shall be deemed to have been received the day after such notice was sent.
5. REPRESENTATIONS AND WARRANTIES: The Borrower hereby makes the following covenants, representations and warranties in favour of the Bank: a. The Borrower has the power to enter into and perform this Agreement and to borrow hereunder and has taken all necessary action to authorize the borrowing of this facility upon the terms and conditions of this Agreement and to authorize the execution, delivery and performance of this Agreement in accordance with its terms. b. That all consents, licenses, approvals, or authorizations of any governmental authority, bureau or agency required in connection with the execution, delivery, performance, validity or enforceability of this Agreement have been obtained and are valid and subsisting. c. That all information relating to the Borrower or otherwise relevant to the matters contemplated by this Agreement which has been supplied to the Bank by the Borrower is true and correct in all material respects and contains no material omission. 6. DRAW DOWN: The draw down on the facility may be made at any time, as agreed between the parties from the date of satisfactory completion of all required documentation and satisfaction of all conditions precedent to drawdown as specified in the Offer Letter and such further conditions as may be communicated by the Lender, but subject to the right of the Bank to cancel and or reduce the facility in line with its ability to accommodate it within its legal lending limits and / or policy or portfolio constraints. 7. TENOR: The Facility shall be for the tenor stated in the offer letter from the date of acceptance of the offer subject to review by the Lender and notification to the Borrower. It may be renewed at the end of the tenor at the discretion of the Lender and upon renewal the same terms and conditions contained in this Agreement shall govern the renewed Agreement. 8. INTEREST PAYMENT AND CAPITALIZATION:
The obligation of the Bank to advance the loan to the Borrower under this agreement is conditional upon the provision of the documents stated in the offer letter and other documents required by the Bank.
date same became payable to the date on which it is in fact paid and may at the sole discretion of the Bank be at any time capitalized and added for all purposes to the facility hereby secured and bear interest accordingly until actually paid and all overdue interests shall be secured in the same manner as the facility and all covenants, provisions and remedies contained in and conferred by this Agreement and all rules of law and equity in relation to the facility and the interest thereon shall equally apply to such overdue amounts and to the interest thereon.
9. PREPAYMENTS AND CANCELLATIONS: a) The Borrower may at any time elect to prepay the Loan or any part thereof in such amount of money as is agreeable to the Bank by giving the Bank 7 (seven) days notice of such election without any penalty, failing which a penalty as determined by the Bank shall apply on such pre-paid amount. b) Any exercise of the power of election under Clause 9 a) hereof shall oblige the Borrower to pay to the Bank on the date of such prepayment for account of the Bank the principal outstanding amount of such facility together with interest and fees during the period between the last interest payment date applicable to it and the date of prepayment. c) Any notice given under this Clause shall be irrevocable and shall commit the Borrower to pay to the Bank the amount therein stated on the stated date d) No amount prepaid under this clause shall be available for redrawing. Amounts prepaid under this Clause shall reduce the Borrower’s repayment obligations under this Agreement, such prepaid installment shall be applied to the furthermost maturities. 10. REPAYMENT SCHEDULE: Repayment of the principal sum and interest and all usual commissions and bank charges and all costs and expenses shall be as expressly agreed by both parties. The Borrower shall ensure that all payments are made to the Bank’s Head Office or any branch specified by the Bank during business hours on the agreed due dates.
11. TAXES: All payments, whether principal, interest or otherwise, to be made by the Borrower to the Bank, shall be made free and clear of and without deduction of any taxes, duties, with the prevailing money market conditions, set-offs, rate shall be as In line charges, fees, deductions, withholdings, interest counterclaims or restrictionsin the offer letter, which shall be reviewed from time to time. Any of any nature. contained change in the pricing of this facility notified by the Lender to the Borrower shall be Where by any law or regulation, the Borrower shall be required to deduct or binding on the parties. In the event that the Borrower rejects the change in the withhold any sum from the total sum or any installment payable to the Bank, the pricing of the facility as notified to it by the Lender, the facility together with all Borrower undertakes to pay such additional amounts as may be necessary to interest, charges and banker’s fees thereon shall immediately become payable by ensure that the Bank receives a net amount equal to the full amount which the the Borrower. Bank would have received had such deductions or withholding taxes not been made by the Borrower. If any principal or interest or installment required by this Agreement to be paid 12. shall remain unpaid the day after the same ought to have been paid, then without CHANGE IN CIRCUMSTANCES: prejudice to any or all of the rights and remedies accruing to the Bank consequent upon such default, the amount so in arrears shall thenceforth itself bear interest at the rate of default stated in the offer letter computed from the
illegal for the Borrower to perform its obligations hereunder then and in any such situation: i. the available facility shall be automatically cancelled and the Bank’s commitment shall be reduced to zero. ii. The Borrower shall repay to the Bank the outstanding principal amount of the facility together with accrued interest thereon and any accrued but unpaid commissions and other costs and charges payable hereunder. b) If any change in law or administrative regulations applicable to this Agreement or any interpretation by the courts of law make it unlawful or illegal for the Lender to perform its obligations hereunder then and in any such situation: i. The Lender shall be discharged from all obligations towards the Borrower hereunder and its commitment reduced to zero. ii. The yet un-drawn portion of the Loan shall be reduced by the amount of the Bank’s commitment immediately prior to the occurrence of such event and the Borrower shall on demand pay to the Bank its outstanding advance on the next interest payment date relating thereto. 13. COVENANTS: For the duration of the agreement, the Borrower shall: a) insure and keep insured with an insurance company acceptable to the Bank all its property and effects of all description which are usually insured to the full insurable value thereof against fire, earthquake, tornado, strikes, riots, burglary and malicious damage by a policy noting the interest of the Bank on the Policy. All moneys which may at any time hereafter be receivable under any risks as aforesaid shall be applied in replacing, restoring or reinstating the property destroyed or damaged towards the discharge of the facility and other monies hereby covenanted to be paid as the Bank may require PROVIDED ALWAYS that if the Borrower shall fail to pay the insurance premium on the property the Bank reserves the right to pay the premium and debit the Borrower’s account accordingly.
a) If any change in law or administrative regulations applicable to this Agreement or any interpretation by the courts of law make it unlawful or
d. If any encumbrancer takes possession of or a receiver or other similar officer is appointed for all or any part of the undertaking and assets of the Borrower; e. If the Borrower commits any breach of this Agreement and in the case of any breach capable of remedy fails to remedy the breach within 7 (Seven) days of being required in writing by the Bank to do so; f. If there should in the opinion of the Bank be a material adverse change in the financial condition of the Borrower; g. If any Government consent required by law for the validity, enforceability or legality of this Agreement and the securities hereunder or the performance thereof ceases to be or is not for any reason in full force and effect; h. If any representation or warranty made by the Borrower in this Agreement or in any notice, certificate or statement delivered or made hereunder proves to have been incorrect or materially inaccurate when made or i. If delivered;or shall be in default of any payment obligation to any person or the Borrower group of persons or organization whether such default is waived or not. 15. REMEDIES AND WAIVERS: No failure to exercise or delay in exercising on the part of the Bank any right, power or remedy hereunder shall operate as a waiver thereof nor shall any single or partial exercise of any right, power or remedy prevent any further or other exercise thereof or the exercise of any other right, power or remedy. The rights and remedies herein provided are cumulative and not exclusive of any rights or remedies provided by law. 16. BENEFIT OF AGREEMENT: This Agreement shall be binding upon the Borrower and its successors in title and assigns and shall inure to the benefit of the Bank and its successors in title and assigns, provided that the Borrower may not assign or transfer any of its rights and benefits hereunder save with the prior written consent of the Bank. The Bank may at any time with written notice to the Borrower assign all or any part of its rights and benefits hereunder to any one or more banks or other lending institutions (each of which is hereinafter called a “Participant”) upon the consideration that each Participant shall perform that percentage of the Bank’s right and benefits assigned to such Participant and for this purpose, the Bank may disclose such information about the b) not to mortgage, pledge or appropriate. Borrower as the Bank shall considersubject to any lien or encumbrance property and assets now owned without either securing the Bank’s outstanding on a pari- passu basis or giving other security acceptable to the Bank. 17. c) not take on any additional loan or borrowing or incur any other debt without the COSTS, EXPENSES & FEES: prior written consent of the Bank which consent shall not be unreasonably Thewithheld. shall from time to time at the request of the Bank reimburse the Bank for Borrower all out of pocket expenses including legal fees, stamp duties and registration fees 14. EVENTS OF DEFAULT: reasonably incurred by it in the processing of the loan, the administration or enforcement of this agreement or in recovery of the loan in the event of default oror Without prejudice to the Bank’s right to demand payment of any outstanding sum, in the preservation, protection and enforcement of its rights hereunder. The Borrower reduce or cancel the facility at any time, the facility or the balance of the facility for also agrees to pay the Bank plus interest in the aforementioned rate the time being outstandingfees as set out at the accepted offer letter. shall become repayable upon occurrence of any of the following events: 18. NOTICES: a. If the Borrower fails to pay any sum hereunder when due; b. If the Borrower stops repayment and/or operating of the account; c. If any distress execution, sequestration or other process is levied or enforced upon or issued out against the property of the Borrower and is not discharged within 7 (Seven) days;
19. SET-OFF: The Borrower agrees that the Bank shall have the right to combine or consolidate all or any of the Borrower’s deposits and accounts, set off or transfer any sum or sums standing to the credit of any one or more such accounts towards the satisfaction of all amounts which may become payable to the Bank hereunder.
This Agreement shall be governed by and construed in accordance with the laws of the Federal Republic of Nigeria. 21. AMENDMENTS: This Agreement shall not be amended except by a document signed and sealed by both parties hereto.
22. COMMENCEMENT:
Any notice shall be sufficiently given provided it is in writing and given under the hand of any Manager or Officer of the Bank and sent by post or courier, addressed to the Borrower and every such notice shall be deemed to have been received the day after such notice was sent.
