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Debenture Subscription Agreement Template for Saudi Arabia

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Key Requirements PROMPT example:

Debenture Subscription Agreement

"I need a Debenture Subscription Agreement for a Saudi Arabian real estate development company issuing SAR 500 million in secured debentures to local institutional investors, with quarterly profit payments and a maturity date in March 2025; the agreement must include Shariah-compliance provisions and security over the company's real estate assets."

Document background
The Debenture Subscription Agreement is a crucial document used in Saudi Arabia when a company seeks to raise capital through the issuance of debentures. It serves as the primary contractual framework governing the relationship between the issuing company and the subscribers, detailing the terms of subscription, rights, and obligations of all parties involved. The agreement must comply with Saudi Arabian regulations, particularly the Capital Market Law (CML) and its implementing regulations, as well as Shariah principles if marketed as Islamic securities. This document is essential for companies seeking debt financing in Saudi Arabia and typically includes comprehensive provisions on security arrangements, payment mechanics, events of default, and enforcement rights. The agreement needs to be carefully structured to ensure compliance with local laws while providing adequate protection for both issuers and subscribers.
Suggested Sections

1. Parties: Identification of the Issuer, Subscribers, and any other relevant parties such as security trustees or paying agents

2. Background: Context of the debenture issuance, corporate approvals obtained, and compliance with Shariah principles

3. Definitions and Interpretation: Comprehensive definitions of terms used in the agreement and rules of interpretation

4. Subscription and Issuance: Terms of subscription, payment mechanics, and conditions for issuance of debentures

5. Representations and Warranties: Statements of fact and assurances from the Issuer regarding its capacity, authority, and financial condition

6. Covenants: Ongoing obligations of the Issuer, including financial covenants and reporting requirements

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

8. Rights and Obligations of Debenture Holders: Detailed rights of subscribers, including voting rights and transfer restrictions

9. Security: Details of any security provided for the debentures

10. Payment Provisions: Terms regarding profit payments, principal repayment, and payment mechanics

11. Notices: Process and requirements for serving notices under the agreement

12. Governing Law and Jurisdiction: Saudi Arabian law as governing law and jurisdiction for disputes

Optional Sections

1. Shariah Compliance: Detailed provisions ensuring compliance with Shariah principles - required if the debentures are marketed as Shariah-compliant

2. Security Trustee Provisions: Required if a security trustee is appointed to hold security on behalf of debenture holders

3. Tax Provisions: Detailed tax clauses required if foreign investors are involved or if specific tax treatments apply

4. Currency Provisions: Required if the debentures involve multiple currencies or foreign exchange considerations

5. Market Disruption: Provisions dealing with market disruption events - required for floating rate debentures

6. Meetings of Debenture Holders: Required if collective action mechanisms are needed for multiple subscribers

Suggested Schedules

1. Form of Debenture Certificate: Template of the physical or electronic debenture certificate

2. Terms and Conditions: Detailed terms and conditions of the debentures

3. Form of Transfer Certificate: Template for transferring debentures between holders

4. Payment Schedule: Detailed schedule of profit payments and principal repayment dates

5. Security Documents: Forms of security documents and details of secured assets

6. Shariah Pronouncement: Fatwa or Shariah pronouncement if the debentures are Shariah-compliant

7. Corporate Authorizations: Copies of relevant corporate approvals and authorizations

8. Form of Subscription Application: Template for subscription applications

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

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Relevant Industries

Banking & Financial Services

Real Estate & Construction

Manufacturing & Industrial

Energy & Utilities

Infrastructure Development

Telecommunications

Healthcare

Education

Transport & Logistics

Mining & Resources

Relevant Teams

Legal

Finance

Treasury

Compliance

Risk Management

Corporate Secretariat

Investment Banking

Corporate Finance

Shariah Advisory

Board Secretariat

Relevant Roles

Chief Financial Officer

Treasury Manager

Legal Counsel

Compliance Officer

Investment Manager

Corporate Finance Director

Financial Controller

Risk Manager

Company Secretary

Shariah Compliance Officer

Investment Banker

Corporate Lawyer

Finance Director

Board Director

Chief Executive Officer

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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