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This Employee Loan Agreement is designed for use in the United Arab Emirates when an employer wishes to provide a financial loan to an employee. The document is essential for companies operating in the UAE that offer employee loan programs as part of their benefits package or to assist employees with specific financial needs. The agreement must comply with UAE Labor Law, Civil Code, and Sharia principles, particularly regarding interest and loan structures. It includes comprehensive details about loan amount, purpose, repayment through salary deductions, security arrangements (typically end-of-service benefits), and procedures in case of employment termination. This template is particularly relevant in the context of UAE's employment landscape where employee loans are common practice across various industries.

1. Parties: Identifies the employer (lender) and employee (borrower) with full legal names and addresses

2. Background: Establishes the employment relationship and context for the loan request

3. Definitions: Defines key terms used throughout the agreement

4. Loan Amount and Purpose: Specifies the exact loan amount and its intended purpose

5. Disbursement Terms: Details how and when the loan amount will be paid to the employee

6. Repayment Terms: Specifies the repayment schedule, installment amounts, and method of payment (typically salary deduction)

7. Interest/Administrative Fees: Details any administrative fees or profit rate (ensuring Sharia compliance)

8. Employee Covenants: Employee's obligations and representations regarding the loan

9. Security and Guarantees: Details about end-of-service benefits or other security for the loan

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

11. Termination of Employment: Handling of loan repayment in case of employment termination

12. Governing Law and Jurisdiction: Specifies UAE law as governing law and relevant courts