Overfacility Agreement Template for Belgium

The Overfacility Agreement is a specialized financial instrument used when a borrower requires additional credit beyond their existing facility limits. This document type is particularly relevant in the Belgian market where companies often seek flexible financing solutions while adhering to strict regulatory requirements. The agreement details the terms under which a lender (typically a Belgian bank or financial institution) will provide additional credit facilities to a borrower, including specific provisions for drawdown, interest calculation, repayment terms, and security arrangements. The document must comply with Belgian financial regulations and banking laws, including requirements set by the Financial Services and Markets Authority (FSMA). It's commonly used in situations where businesses experience growth, require additional working capital, or face temporary liquidity needs beyond their existing credit arrangements.

1. Parties: Identification of the lender(s) and borrower(s), including their legal details and registered addresses

2. Background: Context of the agreement, including any existing facilities and the purpose of the overfacility

3. Definitions and Interpretation: Definitions of key terms used throughout the agreement and rules of interpretation

4. The Facility: Details of the overfacility amount, purpose, and availability period

5. Conditions Precedent: Conditions that must be satisfied before the facility becomes available

6. Utilisation: Process and requirements for drawing down the facility

7. Interest: Interest rate(s), calculation methods, and payment provisions

8. Fees and Expenses: All applicable fees, charges, and cost recovery provisions

9. Repayment and Prepayment: Terms for scheduled repayments and voluntary/mandatory prepayments

10. Representations and Warranties: Statements of fact and assurances given by the borrower

11. Information Undertakings: Borrower's obligations to provide financial and other information

12. Financial Covenants: Financial ratios and tests that the borrower must maintain

13. General Undertakings: Borrower's general obligations and restrictions

14. Events of Default: Circumstances that allow the lender to cancel the facility and demand repayment

15. Changes to Parties: Rules regarding assignment, transfer, and delegation

16. Administration: Operational aspects including payments, calculations, and notices

17. Governing Law and Jurisdiction: Confirmation of Belgian law governance and jurisdiction for disputes