Intercompany Loan Agreement Template for Nigeria

An Intercompany Loan Agreement is essential for documenting financial arrangements between affiliated companies operating in Nigeria. This agreement is typically used when one company within a corporate group provides financing to another group company, whether for working capital, expansion, or other business purposes. The document must comply with Nigerian legislation, including the Companies and Allied Matters Act 2020, tax laws, and where applicable, Central Bank of Nigeria regulations. It's particularly important for establishing arm's length terms for transfer pricing purposes and maintaining clear financial records for audit and regulatory compliance. The agreement should be structured to address specific Nigerian requirements regarding corporate borrowing, security registration (if applicable), stamp duties, and foreign exchange regulations if the loan involves foreign currency.

1. Parties: Identification of the lender and borrower companies, including registration details as required under Nigerian law

2. Background: Context of the intercompany loan, relationship between the parties, and purpose of the loan

3. Definitions and Interpretation: Definitions of key terms and interpretation rules, including Nigerian law-specific terms

4. The Loan: Core terms including loan amount, purpose, and drawdown conditions

5. Interest: Interest rate, calculation method, and payment terms in compliance with Nigerian regulations

6. Repayment: Repayment schedule, prepayment provisions, and payment mechanics

7. Representations and Warranties: Standard corporate representations and Nigeria-specific confirmations

8. Covenants: Ongoing obligations of the borrower including information provision and corporate maintenance

9. Events of Default: Circumstances constituting default and consequences

10. Taxes and Stamp Duty: Tax provisions including withholding tax and stamp duty obligations under Nigerian law

11. Notices: Communication procedures between parties

12. Governing Law and Jurisdiction: Nigerian law as governing law and jurisdiction provisions