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The Lending Loan Agreement is a crucial document used in Saudi Arabia for facilitating financial transactions between lenders and borrowers while ensuring compliance with Islamic finance principles and local regulations. This agreement type is essential when parties wish to establish a formal lending arrangement that adheres to both Sharia law and Saudi Arabian banking regulations. The document covers all aspects of the lending relationship, including facility details, profit calculations (rather than interest), security arrangements, and enforcement mechanisms. A properly structured Lending Loan Agreement is particularly important in Saudi Arabia as it must balance international banking practices with local legal requirements and Islamic finance principles, making it suitable for both domestic and international transactions involving Saudi Arabian entities. The agreement typically includes detailed provisions for Sharia compliance, SAMA regulations adherence, and specific enforcement mechanisms available under Saudi law.

1. Parties: Identification of the lender(s) and borrower(s), including their full legal names, commercial registration numbers, and authorized representatives

2. Background: Context of the loan agreement, purpose of the facility, and confirmation of Sharia compliance

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

4. Facility Details: Description of the loan facility, amount, purpose, and any sub-facilities

5. Conditions Precedent: Documents and conditions required before the loan can be drawn

6. Drawdown Mechanics: Procedures and requirements for requesting and making drawdowns

7. Repayment Terms: Schedule of repayments, payment mechanics, and prepayment provisions

8. Profit Rate and Fees: Profit rate calculation (ensuring Sharia compliance), fees, and payment terms

9. Security: Details of security arrangements and guarantees

10. Representations and Warranties: Statements of fact and assurances given by the borrower

11. Covenants: Positive and negative obligations of the borrower during the loan term

12. Events of Default: Circumstances constituting default and consequences

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

14. Payments and Calculations: Payment mechanics, currency provisions, and calculation conventions

15. Changes to Parties: Rules regarding assignment and transfer of rights and obligations

16. Notices: Communication procedures between parties

17. Governing Law and Jurisdiction: Confirmation of Saudi law governance and jurisdiction of Saudi courts

18. Execution: Signature blocks and execution formalities