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The Line of Credit Contract is a fundamental financing document used in the United Arab Emirates when a borrower requires flexible, ongoing access to credit from a financial institution. This agreement, governed by UAE law, establishes a maximum credit limit that can be repeatedly drawn down and repaid over time. The document incorporates essential provisions required by UAE banking regulations, including compliance with UAE Federal Law No. 14 of 2018 and related banking legislation. It can be adapted for both conventional and Islamic banking structures, making it suitable for the UAE's dual banking system. The contract typically includes detailed terms regarding facility limits, drawdown mechanisms, interest/profit calculations, security requirements, and compliance obligations. It's commonly used for working capital financing, business expansion, or ongoing operational needs, providing businesses with flexible access to funding while protecting the lender's interests through carefully structured terms and conditions.

1. Parties: Identification of the Lender (financial institution) and the Borrower, including full legal names, addresses, and registration details

2. Background: Context of the agreement and brief description of the purpose of the line of credit

3. Definitions: Detailed definitions of terms used throughout the agreement, including 'Facility Amount', 'Interest Rate', 'Availability Period', 'Event of Default', etc.

4. The Facility: Details of the credit facility including the total amount, purpose, and nature of the revolving facility

5. Conditions Precedent: Conditions that must be satisfied before the facility becomes available

6. Utilization: Process and requirements for drawing down the facility, including notice requirements and minimum amounts

7. Interest: Interest calculation method, payment dates, default interest provisions

8. Repayment: Terms of repayment including payment schedule, prepayment provisions, and account details

9. Representations and Warranties: Standard representations made by the borrower regarding their legal status, capacity, and financial condition

10. Covenants: Positive and negative obligations of the borrower during the facility period

11. Events of Default: Circumstances that constitute default and their consequences

12. Changes to Parties: Rules regarding assignment and transfer of rights and obligations

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

14. General Provisions: Miscellaneous legal provisions including governing law, jurisdiction, and amendments

15. Execution: Signature blocks and execution formalities