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Financing Contract Agreement Template for United Arab Emirates

A comprehensive legal document governed by UAE law that establishes the terms and conditions of a financing arrangement between a lender and borrower. This agreement incorporates specific UAE regulatory requirements, including Central Bank regulations and potentially Islamic finance principles. It details the facility amount, repayment terms, security arrangements, and obligations of all parties, while ensuring compliance with UAE Civil and Commercial Laws. The document includes provisions for both conventional and Sharia-compliant financing structures where applicable, and addresses local requirements for documentation, registration, and enforcement.

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What is a Financing Contract Agreement?

The Financing Contract Agreement is a crucial document used in the United Arab Emirates for establishing legally binding financing arrangements between financial institutions and borrowers. This document is essential when any party seeks to obtain financing, whether through conventional or Islamic banking structures, and must comply with UAE Federal Laws, including UAE Civil Code, Commercial Transactions Law, and Central Bank regulations. The agreement comprehensively covers facility terms, security arrangements, representations, warranties, and covenants, while incorporating specific UAE requirements for contract formation and enforcement. It's particularly important for documenting commercial loans, project finance, real estate financing, and corporate credit facilities, requiring careful consideration of both local and international banking practices while maintaining compliance with UAE legal framework.

What sections should be included in a Financing Contract Agreement?

1. Parties: Identification of the finance provider and borrower(s), including full legal names and addresses

2. Background: Context of the financing arrangement, purpose of the facility, and basic commercial terms

3. Definitions: Comprehensive definitions of terms used throughout the agreement, including Arabic translations of key terms where necessary

4. Facility Details: Detailed description of the financing facility, amount, purpose, and drawdown mechanisms

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

6. Repayment Terms: Payment schedule, method of payment, and prepayment provisions

7. Interest/Profit Rate: Specification of interest or profit rate (for Islamic facilities), calculation methods, and payment periods

8. Security: Details of any security or collateral provided to secure the facility

9. Representations and Warranties: Standard and transaction-specific declarations by the borrower

10. Covenants: Positive and negative obligations of the borrower during the facility period

11. Events of Default: Circumstances constituting default and consequences thereof

12. Undertakings: Specific promises and commitments made by the borrower

13. Fees and Expenses: All applicable fees, charges, and cost allocation

14. Governing Law and Jurisdiction: Specification of UAE law as governing law and jurisdiction clause

15. Notices: Communication methods and contact details for formal notices

What sections are optional to include in a Financing Contract Agreement?

1. Islamic Finance Provisions: Required if the facility is Sharia-compliant, including specific Islamic structure (Murabaha, Ijara, etc.)

2. Guarantee: Required if there are third-party guarantors for the facility

3. Insurance: Required if specific insurance coverage is mandatory for the facility

4. Assignment and Transfer: Required if the facility may be transferred or syndicated

5. Tax Provisions: Required if there are specific tax implications or VAT considerations

6. Currency Provisions: Required for facilities involving multiple currencies

7. Agency Provisions: Required for syndicated facilities with an agent bank

8. Account Bank Provisions: Required if specific account maintenance and operation requirements exist

What schedules should be included in a Financing Contract Agreement?

1. Facility Summary: Detailed commercial terms including facility amount, tenor, pricing

2. Conditions Precedent Documents: List of required documentation and conditions

3. Form of Drawdown Notice: Template for borrower to request disbursement

4. Repayment Schedule: Detailed amortization or payment schedule

5. Security Documents: Forms of security documents and perfection requirements

6. Form of Compliance Certificate: Template for periodic compliance reporting

7. Fees Schedule: Detailed breakdown of all applicable fees and charges

8. Authorized Signatories: List of authorized representatives and specimen signatures

9. Form of Transfer Certificate: Template for transferring interests in the facility

10. Know Your Customer Requirements: List of required KYC documentation under UAE law

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Publisher

Genie AI

Document Type

Financing Agreement

Cost

Free to use

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