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Loan Agreement Between Two Companies Generator for United Arab Emirates

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Key Requirements PROMPT example:

Loan Agreement Between Two Companies

"I need a Loan Agreement Between Two Companies under UAE law for a AED 10 million secured loan to finance a real estate development project, with quarterly repayments starting March 2025 and including provisions for corporate guarantees from the parent company."

Document background
The Loan Agreement Between Two Companies is a crucial document used when one corporate entity wishes to extend credit to another in the United Arab Emirates. It serves as the primary contractual framework governing the lending relationship, incorporating all necessary elements required under UAE law, including compliance with both civil and commercial codes. The agreement is particularly relevant for business expansion, project financing, working capital requirements, or asset acquisition. It must address specific UAE requirements regarding interest calculations, security arrangements, and enforcement mechanisms, while potentially incorporating Islamic finance principles where required. The document typically includes detailed provisions on drawdown conditions, repayment terms, events of default, and security arrangements, all structured to ensure enforceability under UAE jurisdiction.
Suggested Sections

1. Parties: Identification of the lender and borrower, including full corporate names, registration details, and addresses

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

3. Definitions: Defined terms used throughout the agreement, including financial, technical, and legal terms

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

5. Interest Rate and Calculations: Details of interest rate (ensuring compliance with UAE laws), calculation methods, and payment periods

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

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

8. Representations and Warranties: Standard and specific representations made by the borrower regarding their legal and financial status

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

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

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

12. Costs and Expenses: Allocation of transaction costs, taxes, and ongoing expenses

13. Notices: Communication procedures and contact details for formal notices

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

15. Execution: Signature blocks and execution requirements under UAE law

Optional Sections

1. Islamic Finance Compliance: Required when the loan needs to be Sharia-compliant, including specific structures to avoid traditional interest

2. Assignment and Transfer: Include when either party may need to transfer their rights or obligations

3. Security Trustee Provisions: Required when there are multiple lenders or the security structure requires a trustee

4. Currency Provisions: Include when the loan involves multiple currencies or foreign exchange considerations

5. Tax Provisions: Detailed tax clauses needed when cross-border elements exist or specific tax arrangements are required

6. Increased Costs: Include when regulatory changes might affect the lender's costs

7. Force Majeure: Optional clause for unforeseeable circumstances, particularly relevant in long-term loans

8. Syndication Provisions: Required when the loan may be syndicated to other lenders

Suggested Schedules

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

2. Repayment Schedule: Detailed schedule of repayment dates and amounts

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

4. Security Documents: Forms of security documents and guarantees

5. Financial Covenants: Detailed financial ratios and calculations

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

7. Permitted Security Interests: List of existing or permitted security interests

8. Fee Schedule: Breakdown of all applicable fees and charges

Authors

Alex Denne

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

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Relevant Industries

Banking & Financial Services

Real Estate

Construction

Manufacturing

Trading & Commerce

Technology

Healthcare

Hospitality

Energy & Resources

Infrastructure

Retail

Logistics & Transportation

Professional Services

Relevant Teams

Legal

Finance

Treasury

Credit

Risk Management

Compliance

Corporate Banking

Commercial

Executive Leadership

Corporate Secretariat

Business Development

Relevant Roles

Chief Financial Officer

Finance Director

Legal Counsel

Corporate Lawyer

Treasury Manager

Financial Controller

Credit Manager

Risk Manager

Commercial Director

Business Development Manager

Company Secretary

Compliance Officer

Managing Director

CEO

Head of Corporate Banking

Relationship Manager

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

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