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Revolving Bank Guarantee
"I need a Revolving Bank Guarantee for our construction company in Lagos, with a maximum facility amount of ₦100 million, renewable quarterly, to be issued by First Bank Nigeria to support ongoing government infrastructure projects starting March 2025."
1. Parties: Identification of the Guarantor Bank, the Applicant (Principal), and the Beneficiary
2. Background: Context of the guarantee, underlying business relationship, and purpose of the guarantee
3. Definitions: Definitions of key terms including Guarantee Amount, Validity Period, Revolving Mechanism, and other relevant terms
4. Guarantee Amount and Scope: Specification of the maximum guarantee amount, revolving nature, and scope of the bank's undertaking
5. Duration and Renewal: Terms of the guarantee period, automatic renewal conditions, and expiry mechanisms
6. Revolving Mechanism: Detailed explanation of how the guarantee amount revolves, reinstatement conditions, and cycle periods
7. Demand and Payment Terms: Procedures for making demands under the guarantee, required documentation, and payment terms
8. Bank's Rights and Obligations: Scope of bank's obligations, examination rights, and payment conditions
9. Counter-Indemnity: Principal's obligations to indemnify the bank against claims and payments
10. Fees and Charges: Commission, fees, and other charges payable to the bank
11. Events of Default: Circumstances constituting default and their consequences
12. Governing Law and Jurisdiction: Nigerian law as governing law and jurisdiction for disputes
1. Foreign Currency Provisions: Required when the guarantee involves foreign currency transactions, including exchange rate mechanisms and CBN compliance
2. Multiple Beneficiaries: Required when the guarantee is issued in favor of multiple beneficiaries, describing their rights and relationships
3. Step-In Rights: Optional provisions allowing the bank to step into the underlying contract in specific circumstances
4. Assignment and Transfer: Required when either party needs the right to assign or transfer their rights under the guarantee
5. Electronic Documentation: Optional section covering electronic submission of documents and digital authentication methods
6. Force Majeure: Optional provisions dealing with extraordinary events affecting the guarantee operations
1. Schedule 1 - Form of Demand: Prescribed format for making demands under the guarantee
2. Schedule 2 - Fee Schedule: Detailed breakdown of all applicable fees, charges, and commission
3. Schedule 3 - Supporting Documents: List of required supporting documents for guarantee activation and demands
4. Schedule 4 - Authorized Signatories: List of authorized signatories and specimen signatures
5. Appendix A - Underlying Contract Summary: Summary of the main contract or obligation being guaranteed
6. Appendix B - Compliance Checklist: Regulatory compliance requirements and confirmations
Authors
Banking & Financial Services
Construction & Infrastructure
Oil & Gas
Manufacturing
International Trade
Telecommunications
Real Estate Development
Government & Public Sector
Mining & Natural Resources
Retail & Commerce
Legal
Finance
Treasury
Risk Management
Commercial
Procurement
Compliance
Corporate Secretariat
Trade Finance
Project Finance
Chief Financial Officer
Treasury Manager
Finance Director
Risk Manager
Commercial Director
Contract Manager
Legal Counsel
Banking Relationship Manager
Credit Manager
Procurement Manager
Project Finance Manager
Company Secretary
Financial Controller
Trade Finance Manager
Compliance Officer
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