Document background
The Framework Loan Agreement is utilized when parties wish to establish a flexible lending arrangement allowing multiple drawdowns over time without executing separate loan agreements for each borrowing. This document type is particularly relevant in the Nigerian market where ongoing financing relationships between banks and corporate borrowers require efficient access to credit. The agreement must comply with Nigerian banking laws, particularly BOFIA 2020 and Central Bank of Nigeria regulations, while providing clear mechanisms for drawdowns, repayments, and security arrangements. It includes comprehensive terms covering facility limits, interest calculations, conditions precedent, representations and warranties, covenants, and events of default. The framework structure is especially useful for businesses requiring regular access to funding for working capital, project financing, or expansion plans, offering efficiency and cost savings compared to multiple standalone loan agreements.
