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Credit Agreement For Supply Of Goods Template for Saudi Arabia

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Key Requirements PROMPT example:

Credit Agreement For Supply Of Goods

"I need a Credit Agreement For Supply Of Goods under Saudi law for my manufacturing company to provide industrial machinery worth SAR 5 million to a construction company, with credit terms spread over 24 months starting March 2025, including monthly delivery schedules and Sharia-compliant profit rates."

Document background
The Credit Agreement For Supply of Goods is a specialized financing instrument used in Saudi Arabian commercial transactions where a supplier provides both goods and credit facilities to a purchaser. This document is particularly relevant when businesses require both product supply and financing arrangements in a single agreement, common in large-scale commercial transactions within Saudi Arabia. The agreement must comply with Saudi Arabian law, including Sharia principles, making it distinct from conventional credit agreements used in other jurisdictions. It typically includes detailed terms for both the supply arrangement (specifications, delivery, quality) and the credit facility (payment terms, profit rates, security), while ensuring all financial aspects conform to Islamic banking principles. This type of agreement is commonly used in manufacturing, retail, and industrial sectors, particularly for significant capital expenditure or ongoing supply arrangements requiring structured financing.
Suggested Sections

1. Parties: Identification of the creditor/supplier and the debtor/purchaser, including full legal names, registration details, and addresses

2. Background: Context of the agreement, relationship between parties, and purpose of the credit facility and goods supply arrangement

3. Definitions: Definitions of key terms used throughout the agreement, including financial terms, delivery terms, and technical specifications

4. Credit Facility Terms: Details of the credit facility, including amount, profit rate (compliant with Sharia), payment schedule, and calculation methodology

5. Supply Arrangements: Terms relating to the supply of goods, including specifications, delivery schedules, and quality requirements

6. Payment Terms: Payment structure, installment details, currency, and payment mechanics

7. Security: Security arrangements, guarantees, or collateral required to secure the credit facility

8. Conditions Precedent: Conditions that must be satisfied before the credit facility becomes available

9. Representations and Warranties: Statements of fact and assurances given by both parties

10. Covenants: Ongoing obligations of the parties during the term of the agreement

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

12. Termination: Circumstances and procedures for termination of the agreement

13. Governing Law and Jurisdiction: Confirmation of Saudi law as governing law and jurisdiction for disputes

Optional Sections

1. Islamic Finance Compliance: Detailed section on Sharia compliance aspects - include when the agreement needs explicit confirmation of compliance with Islamic finance principles

2. Insurance: Requirements for insurance of goods - include when high-value goods are involved or specific insurance is required

3. Export/Import Requirements: Specific provisions for international trade - include when goods are being imported/exported

4. Tax Provisions: Detailed tax implications and responsibilities - include when complex tax arrangements apply

5. Force Majeure: Provisions for unforeseen circumstances - include when dealing with long-term supply arrangements

6. Assignment and Transfer: Rights to assign or transfer obligations - include when either party might need to transfer rights

7. Confidentiality: Detailed confidentiality obligations - include when sensitive commercial information is involved

Suggested Schedules

1. Schedule 1 - Goods Specification: Detailed technical specifications of goods to be supplied

2. Schedule 2 - Payment Schedule: Detailed payment terms, installment dates, and amounts

3. Schedule 3 - Delivery Schedule: Timeline and details for delivery of goods

4. Schedule 4 - Form of Drawdown Notice: Template for requesting disbursement under the credit facility

5. Schedule 5 - Security Documents: Forms of security documents, guarantees, or collateral arrangements

6. Schedule 6 - Conditions Precedent Documents: List of required documents and conditions to be satisfied

7. Appendix A - Calculation of Profit Rate: Methodology for calculating Sharia-compliant profit rate

8. Appendix B - Form of Compliance Certificate: Template for periodic compliance certification

Authors

Alex Denne

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

Relevant legal definitions















































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Relevant Industries

Manufacturing

Retail

Industrial Equipment

Construction

Technology and Electronics

Automotive

Energy and Utilities

Healthcare and Medical Equipment

Agriculture

Consumer Goods

Telecommunications

Relevant Teams

Legal

Finance

Procurement

Supply Chain

Treasury

Risk Management

Compliance

Operations

Credit Control

Commercial

Relevant Roles

Chief Financial Officer

Finance Director

Commercial Director

Legal Counsel

Procurement Manager

Supply Chain Manager

Credit Controller

Treasury Manager

Contracts Manager

Risk Manager

Islamic Finance Specialist

Operations Director

Compliance Officer

Chief Legal Officer

Financial Controller

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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