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The Private Loan Agreement is essential for documenting financial arrangements between private parties in Saudi Arabia, whether individuals or businesses. It must comply with both civil law requirements and Islamic finance principles, making it distinct from conventional lending agreements used in other jurisdictions. The document is commonly used for business expansion, personal financing, real estate purchases, or other legitimate funding needs. It includes specific provisions required by Saudi law and SAMA regulations, such as profit-sharing mechanisms instead of interest charges, and must be structured to ensure enforceability in Saudi courts. The agreement typically requires proper witnessing and may need notarization depending on the loan amount and purpose.

1. Parties: Identification of the Lender and Borrower with full legal names and contact details

2. Background: Context of the loan arrangement and relationship between the parties

3. Definitions: Key terms used throughout the agreement defined for clarity

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

5. Disbursement Terms: Conditions and process for disbursement of the loan amount

6. Repayment Terms: Schedule and method of repayment, including profit rate (if applicable under Sharia principles)

7. Security and Guarantees: Details of any collateral or guarantees securing the loan

8. Representations and Warranties: Statements of fact and promises made by the Borrower

9. Borrower Covenants: Ongoing obligations and restrictions on the Borrower

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

11. Sharia Compliance Declaration: Statement confirming the agreement's compliance with Islamic principles

12. Governing Law and Jurisdiction: Specification of Saudi law and courts' jurisdiction

13. Notices: Process and addresses for formal communications between parties

14. Execution: Signature blocks and execution requirements