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The Term Loan Facility Agreement is a fundamental document used in Saudi Arabian corporate financing transactions where a lender provides term financing to a borrower in compliance with Islamic principles. This agreement is essential for medium to long-term financing needs, such as capital expenditure, expansion projects, or general corporate purposes. It must be structured in accordance with Saudi Arabian law and Shariah principles, typically utilizing Islamic financing structures such as Murabaha, Ijara, or other acceptable formats. The document encompasses all necessary provisions required by Saudi banking regulations and SAMA guidelines, including profit calculation methodologies, security arrangements, and enforcement mechanisms. It's particularly important to note that the agreement must avoid conventional interest-based structures and instead incorporate Islamic finance concepts while maintaining commercial viability.

1. Parties: Identification of the lender(s), borrower(s), and any other parties to the agreement

2. Background: Context of the facility and confirmation of Shariah compliance

3. Definitions and Interpretation: Definitions of terms used and interpretation rules, including Islamic finance terminology

4. The Facility: Details of the loan facility, amount, purpose, and Islamic structure used

5. Conditions Precedent: Conditions that must be satisfied before drawdown

6. Drawdown: Procedures and requirements for utilization of the facility

7. Repayment: Terms of repayment including schedule and prepayment provisions

8. Profit Rate and Fees: Profit rate calculation (avoiding interest), fees, and other charges in compliance with Shariah

9. Tax Provisions: Tax obligations and provisions for withholding tax

10. Representations and Warranties: Statements of fact and assurances from the borrower

11. Undertakings: Positive and negative covenants of the borrower

12. Events of Default: Circumstances constituting default and consequences

13. Changes to Parties: Provisions for transfer, assignment, and changes in parties

14. Administration: Administrative provisions and payment mechanics

15. Governing Law and Jurisdiction: Saudi law as governing law and jurisdiction provisions

16. Notices: Communication procedures between parties

17. Execution: Signature blocks and execution formalities