Utilisation Facility Agreement

A user fee is a regular and regular levy imposed by a lender against a borrower. The commission is determined by the amount of credit actually used by a borrower on a revolving or maturity line of credit. The borrower can use the facility by providing a completed user application no later than 11 .m a business day before the date of use (or a shorter period, as the lender may accept) by providing the lender. If the terms of the terms set out in points 4 (Terms of Use) and 5.1 (Sending a User Request) at 5.3 (currency and amount) are met, the lender makes the proposed loan available on the date of use through its Facility Office. If all borrowers were to deplete the entire balance available to them, lenders could be stretched to meet demand evenly. By imposing user fees, a lender can create capital flows to maintain its operations, while encouraging borrowers to reduce or eliminate their balances to avoid paying those costs. The terms of a user fee may vary depending on the lender and the type of loans or loans used. A user fee clause may require, for example. B, that the borrower pays an amount on the basis of the average total amount of the outstanding if that balance is greater than a certain percentage of the daily average of the overall commitment.

User fees and conditions may vary depending on the type of credit or loan used and the lender. Payment can be made on an annual basis, but the fee could be based on a quarterly or even daily assessment of the outstanding. The fee can be calculated by calculating to the borrower, for a specified interval, that the remaining balance payable is above a fixed threshold in relation to the total line of credit. The currency indicated in the usage requirement must be the U.S. dollar. The borrower can only apply for use if the lender has received all of the documents and other evidence listed in Schedule 1 (previous conditions) that are satisfactory to the lender. Therefore, if a borrower has a $2 million line of credit with a user fee clause with a 50% threshold and the remaining balance has exceeded $1 million for three days, he or she would be liable for a user fee based on that period. If the outstanding amount has remained below this threshold, the borrower cannot be liable for a user fee, at least not at the same rate.

Some clauses set the outstanding threshold at 33.3% of the total commitment, while others may set it at 50% before user charges are triggered. Use charges can even be charged on the balance of the outstanding, regardless of the percentage relative to the total amount of the line of credit or loan.

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