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The Loan Agreement And Promissory Note is a crucial document in Saudi Arabian finance, designed to facilitate Shariah-compliant lending while providing security for the lender through an integrated promissory note. This document is commonly used when a party requires financing while ensuring compliance with Islamic finance principles that prohibit conventional interest-based lending. It includes detailed terms for the loan facility, repayment mechanisms, profit calculation methods, and security arrangements, all structured to meet Shariah requirements. The promissory note component provides an additional layer of security and can be independently enforced under Saudi Arabian law. This document is particularly relevant for business financing, real estate transactions, and corporate lending, incorporating necessary provisions to comply with SAMA regulations, the Banking Control Law, and other relevant Saudi Arabian legislation.

1. Parties: Identification of the Lender and Borrower with full legal names, addresses, and registration details if applicable

2. Background: Context of the loan arrangement and confirmation of Shariah compliance

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

4. Loan Amount and Purpose: Specification of the principal amount and permitted use of funds

5. Shariah Structure: Details of the Islamic financing structure being used (e.g., Murabaha, Ijara) to ensure Shariah compliance

6. Disbursement Terms: Conditions precedent and mechanism for disbursement of the loan

7. Repayment Terms: Schedule and method of repayment, including profit rate (instead of interest)

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

9. Representations and Warranties: Standard declarations by the borrower regarding their capacity and authority

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

11. Events of Default: Circumstances constituting default and consequences

12. Promissory Note Terms: Specific terms related to the promissory note including form and delivery

13. Enforcement: Rights and remedies of the lender in case of default

14. Governing Law and Jurisdiction: Confirmation of Saudi law application and jurisdiction