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The Sale And Leaseback Contract is a strategic financial instrument used in Saudi Arabia when organizations wish to release capital tied up in real estate assets while maintaining operational use of the property. This document type must be carefully structured to comply with Saudi Arabian law and Sharia principles, making it distinct from conventional sale and leaseback arrangements in other jurisdictions. The contract serves dual purposes: documenting the sale of property to a new owner (usually a financial institution) and establishing a lease arrangement allowing the seller to continue using the property as a tenant. It typically includes comprehensive details about property transfer, lease terms, maintenance obligations, insurance requirements, and compliance with local regulations. The document is particularly useful for businesses seeking to improve their balance sheet position while retaining their operational premises, but must be drafted with careful attention to both commercial and Sharia compliance requirements.

1. Parties: Identification of the Seller/Lessee and Buyer/Lessor, including full legal names and addresses

2. Background: Context of the transaction, including property details and purpose of the arrangement

3. Definitions: Key terms used throughout the agreement, including Property, Completion Date, Lease Term, and Rental Payments

4. Sale Provisions: Terms of the sale, including purchase price, payment terms, and transfer of ownership

5. Property Title and Registration: Confirmation of title, warranties, and registration requirements

6. Lease Terms: Essential lease provisions including duration, renewal options, and rental payment structure

7. Rental Payments: Detailed payment terms, amounts, frequency, and payment mechanisms

8. Use of Property: Permitted use, restrictions, and compliance requirements

9. Maintenance and Repairs: Responsibilities for property maintenance, repairs, and improvements

10. Insurance: Required insurance coverage and responsibility for premiums

11. Default and Remedies: Events of default and available remedies for both parties

12. Termination: Circumstances and procedures for early termination

13. Governing Law and Jurisdiction: Confirmation of Saudi law application and dispute resolution mechanisms

14. Notices: Communication procedures between parties

15. Execution: Signature blocks and execution requirements