The Bank Guarantee Facility agreement is essential for businesses requiring regular access to bank guarantees for their operations in South Africa. This document is particularly relevant for companies involved in construction, tendering, international trade, or any sector where performance or payment guarantees are required. The agreement establishes a pre-approved facility under which individual guarantees can be issued without negotiating new terms each time, streamlining the process while managing risk for all parties. It complies with South African banking regulations, including the Banks Act 94 of 1990 and the Financial Sector Regulation Act 9 of 2017, and typically includes provisions for security, operational procedures, and default scenarios.

1. Parties: Identification of the Bank as guarantor and the Customer applying for the guarantee facility

2. Background: Context of the facility, including the purpose and nature of the banking relationship

3. Definitions and Interpretation: Key terms used in the agreement and rules for interpretation

4. The Facility: Details of the guarantee facility including the facility limit and types of guarantees available

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

6. Issue of Guarantees: Process and requirements for requesting and issuing individual guarantees under the facility

7. Fees and Charges: All applicable fees, commission, and charges for the facility and individual guarantees

8. Security: Security requirements and arrangements for the facility

9. Representations and Warranties: Statements of fact and assurances given by the Customer

10. Customer Undertakings: Ongoing obligations and commitments of the Customer

11. Events of Default: Circumstances that constitute default and their consequences

12. Bank's Rights and Remedies: Actions the Bank can take in case of default or breach

13. Payments and Currency: Payment terms, methods, and currency provisions

14. General Provisions: Standard legal provisions including notices, amendments, and governing law