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Business Loan Agreement for United Arab Emirates

Business Loan Agreement Template for United Arab Emirates

A comprehensive legal document governed by UAE federal laws and regulations that establishes the terms and conditions for a business loan between a financial institution and a business entity. The agreement incorporates UAE-specific legal requirements, including Sharia compliance considerations where applicable, and covers essential elements such as facility details, profit rates, repayment terms, security arrangements, and default provisions. It ensures compliance with UAE Central Bank regulations and commercial laws while protecting both lender and borrower interests through clearly defined rights, obligations, and remedies.

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Business Loan Agreement

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What is a Business Loan Agreement?

The Business Loan Agreement Template is designed for use in the United Arab Emirates, specifically tailored to comply with UAE federal laws, UAE Central Bank regulations, and where applicable, Sharia principles. This template serves as a foundational document for financial institutions and businesses engaging in commercial lending transactions within the UAE jurisdiction. It encompasses comprehensive provisions for loan facility details, profit structures, security arrangements, and compliance requirements, while incorporating necessary elements to ensure enforceability under UAE law. The template is adaptable for various business lending scenarios, from traditional commercial loans to Islamic finance structures, and includes all necessary provisions required by UAE banking regulations and commercial laws. This document should be customized based on specific transaction requirements while maintaining compliance with UAE legal framework.

What sections should be included in a Business Loan Agreement?

1. Parties: Identification of the lender and borrower with full legal names and addresses

2. Background: Context of the loan agreement and brief description of the purpose

3. Definitions: Definitions of key terms used throughout the agreement

4. Facility Details: Amount, purpose, and type of loan facility being provided

5. Profit Rate and Fees: Specification of the profit rate (interest), calculation method, and applicable fees in compliance with Sharia principles

6. Drawdown Conditions: Conditions precedent and procedures for drawing down the loan

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

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

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

10. Events of Default: Circumstances that constitute default and consequences thereof

11. Security: Details of any security or collateral provided for the loan

12. Governing Law and Jurisdiction: Specification of UAE law as governing law and jurisdiction for disputes

What sections are optional to include in a Business Loan Agreement?

1. Guarantees: Required when there is a third-party guarantor for the loan

2. Islamic Finance Provisions: Detailed Sharia-compliance provisions when the loan is structured as an Islamic finance product

3. Insurance: Required when specific insurance coverage is mandatory for the loan

4. Assignment and Transfer: Include when the lender wishes to reserve the right to assign or transfer the loan

5. Multiple Lenders: Required for syndicated loans with multiple lenders

6. Cross-Default: Include when the loan should be linked to other financial obligations

7. Security Trustee: Required when security is held by a trustee on behalf of multiple lenders

8. Change of Control: Include for borrowers where ownership stability is important

What schedules should be included in a Business Loan Agreement?

1. Facility Details Schedule: Detailed breakdown of the loan facility, including amounts, profit rates, and payment schedules

2. Conditions Precedent: List of all documents and conditions required before drawdown

3. Form of Drawdown Notice: Template for the borrower to request loan disbursements

4. Security Documents: List and copies of all security documents

5. Repayment Schedule: Detailed amortization schedule showing all payment dates and amounts

6. Financial Covenants: Detailed financial ratios and requirements to be maintained

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

8. Permitted Security Interests: List of pre-approved security interests that may exist or be created

Authors

Alex Denne

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

Document Type

Loan Agreement

Cost

Free to use
Relevant legal definitions











































Clauses

































Relevant Industries

Banking & Financial Services

Islamic Banking

Commercial Lending

Corporate Finance

Small and Medium Enterprises

Real Estate

Manufacturing

Trading

Technology

Healthcare

Construction

Retail

Hospitality

Professional Services

Relevant Teams

Legal

Finance

Corporate Banking

Risk Management

Compliance

Treasury

Credit Assessment

Islamic Banking

Commercial Lending

Business Development

Operations

Relevant Roles

Chief Financial Officer

Finance Director

Legal Counsel

Corporate Lawyer

Banking Relationship Manager

Credit Risk Manager

Compliance Officer

Treasury Manager

Financial Controller

Business Development Manager

Islamic Finance Specialist

Corporate Banking Officer

Risk Assessment Officer

Commercial Finance Manager

Legal Operations Manager

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, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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