The Currency of Loans and other Financial Assistance
The facilities, grants, loans and other financial assistance of the EGE are denominated in United States Dollars and this currency is considered the currency of account and also the medium of payment in all transactions relating to such facilities, grants, loans and other types of financial assistance.
However, acting as an agent of the borrower or beneficiary of its financial assistance, EGE may effect disbursement in other currencies according to the requirements of the project or operation subject of financing. In such case the amount withdrawn from the loan or other financial assistance (technical assistance grant) provided by EGE, shall be deemed to be equal to the amount of United States Dollars required for the purchase of the respective amount of foreign currency, as determined in accordance with the prevailing exchange rate in the market. Likewise, when repayment of principal or payment of interest and other charges on the facility, grant or loan is being made, EGE, acting as an agent of the Borrower for purchasing the amount of United States Dollars required for payment or repayment, as the case may be, may accept payment in another freely convertible currency. In such case the amount deemed to have been paid EGE in another currency shall be the equivalent in such currency of the amount paid in another freely convertible currency, such equivalent being determined on the basis of the prevailing rate of exchange on the date LAMI actually receives the amount.
Disbursement procedures
No amount from EGE’s facilities, grants nor loan may be withdrawn by the borrower until all the conditions of effectiveness of the relative agreement binding, have been satisfied and EGE has declared such agreement effective.
The proceeds of the funding and financial assistance of EGE can only be disbursed to meet the expenditures on the project, goods, services or other purposes specified in the relative agreement between EGE and the beneficiary of the facility, grant, loan or other financial assistance. It is necessary that certain forms prepared by EGE be used for making withdrawals from loans and other financial assistance. These forms cover the following cases:
*At NO time will a recipient/beneficiary of our facility, grant or loan request to withdraw funds from where the approved fund is placed for transaction in our nominated escrow firm or banking institution without meeting with obligations of the escrow firm or banking instution which might have its own charges or fees instituted to safe guard our funds for security purposes.
*Reimbursement of expenditures already made by the Borrower.
*Discharging outstanding amounts due to suppliers, contractors or consultants with whom a contract was made by the Borrower.
Effecting payments to banking institutions in accordance with the provisions of undertakings by EGE to reimburse such institutions in respect of payments made under documentary letters of credit issued at the request of the borrower.