The Tri Party Loan Agreement is a sophisticated financial instrument used in Nigerian business and banking transactions where a traditional bilateral loan arrangement is insufficient to meet complex financing needs. This document is particularly relevant when additional oversight, security arrangements, or specialized roles are required in a loan transaction. It is commonly used in project financing, syndicated lending, and secured corporate loans where a third party (such as a security trustee or facility agent) plays a crucial role in managing the loan relationship. The agreement must comply with Nigerian banking regulations, including the Banks and Other Financial Institutions Act (BOFIA) 2020 and Central Bank of Nigeria guidelines. It includes comprehensive provisions for loan disbursement, security arrangements, payment mechanisms, and the specific duties of each party, while incorporating necessary protections and enforcement mechanisms under Nigerian law.

1. Parties: Identifies and defines all three parties to the agreement - typically the Lender, Borrower, and the Third Party (which could be a guarantor, security trustee, or agent)

2. Background: Sets out the context of the agreement and the intention of the parties to enter into the loan arrangement

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

4. The Facility: Details of the loan amount, purpose, and conditions precedent to drawdown

5. Interest and Fees: Specifies interest rate, calculation method, payment dates, and any applicable fees

6. Repayment Terms: Sets out the repayment schedule, prepayment provisions, and mandatory prepayment events

7. Security: Details of any security or collateral provided for the loan

8. Representations and Warranties: Statements of fact and assurances given by each party

9. Covenants: Positive and negative obligations of the parties throughout the loan term

10. Events of Default: Circumstances that would constitute a default and the consequences thereof

11. Role and Duties of Third Party: Specific responsibilities and obligations of the third party

12. Payments and Calculations: Mechanics of payments, payment hierarchy, and calculation conventions

13. Changes to Parties: Provisions regarding assignment, transfer, and succession

14. Notices: Communication requirements and contact details

15. Governing Law and Jurisdiction: Confirms Nigerian law as governing law and specifies jurisdiction for disputes