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The Loan Agreement Shareholder To Company is a crucial document used when a shareholder provides funding to their company in Saudi Arabia. This agreement is particularly important in scenarios where traditional bank financing may not be suitable or available, or when shareholders wish to support their company's growth or working capital needs. The document must comply with both Saudi Arabian law and Shariah principles, particularly avoiding conventional interest-based structures. It typically includes detailed terms for the loan amount, purpose, disbursement conditions, repayment terms, and any security arrangements. The agreement also addresses corporate governance requirements, necessary approvals, and the rights and obligations of both the lending shareholder and the borrowing company. This type of agreement is commonly used in corporate restructuring, expansion projects, or when companies need additional working capital.

1. Parties: Identification of the Shareholder (Lender) and the Company (Borrower), including full legal names and registration details

2. Background: Context of the loan, relationship between parties, and confirmation of Shariah compliance

3. Definitions and Interpretation: Key terms used in the agreement, including Shariah-compliant financing terms

4. Facility Amount and Purpose: Amount of the loan and specified use of funds by the Company

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

6. Repayment Terms: Structure and schedule of repayment, ensuring Shariah compliance

7. Securities and Guarantees: Details of any security or guarantees provided for the loan

8. Representations and Warranties: Standard and specific confirmations from both parties

9. Covenants: Ongoing obligations of the Company during the loan period

10. Events of Default: Circumstances constituting default and consequences

11. Shariah Compliance: Specific provisions ensuring compliance with Islamic finance principles

12. Governing Law and Jurisdiction: Application of Saudi law and Islamic Shariah principles

13. Notices: Communication procedures between parties

14. Confidentiality: Protection of confidential information