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Loan Guarantee Agreement
"I need a Loan Guarantee Agreement under UAE law for a parent company guaranteeing a AED 10 million commercial loan to its subsidiary, with specific provisions for multiple drawdowns throughout 2025 and Islamic finance compliance requirements."
1. Parties: Identification of the Guarantor, Lender (Beneficiary), and Principal Debtor, including full legal names and addresses
2. Background: Context of the guarantee, reference to the principal loan agreement, and purpose of the guarantee
3. Definitions: Definitions of key terms used throughout the agreement, including 'Guaranteed Obligations', 'Security', 'Event of Default', etc.
4. Guarantee and Indemnity: Core provisions detailing the guarantee obligations, including the scope, limitations, and nature (conditional/unconditional) of the guarantee
5. Representations and Warranties: Guarantor's confirmations regarding their capacity, authority, and financial condition
6. Payment Mechanics: Details of how and when payments must be made, currency provisions, and payment priorities
7. Enforcement and Rights: Lender's rights upon default, enforcement mechanisms, and remedies available
8. Duration and Release: Term of the guarantee and conditions for its release or termination
9. Communications: Notice provisions and communication requirements between parties
10. Governing Law and Jurisdiction: Specification of UAE law as governing law and jurisdiction for disputes
1. Islamic Finance Compliance: Required when the guarantee needs to be Sharia-compliant, including relevant provisions and structure
2. Security Provisions: Include when additional security is being provided alongside the guarantee
3. Corporate Authorizations: Required when the guarantor is a corporate entity, detailing corporate approvals obtained
4. Tax Provisions: Include when cross-border elements exist or specific tax implications need to be addressed
5. Currency Provisions: Required when the guarantee involves multiple currencies or currency conversion rights
6. Assignment and Transfer: Include when rights under the guarantee may need to be assigned or transferred
7. Multiple Guarantors: Required when there are multiple guarantors, addressing joint and several liability
1. Principal Loan Agreement: Copy or key terms of the underlying loan agreement being guaranteed
2. Guarantee Limit Schedule: Details of any caps or limitations on the guarantee amount
3. Form of Demand: Template for making a demand under the guarantee
4. Corporate Authorizations: Copies of relevant board resolutions, powers of attorney, or other authorizations
5. Security Documents: If applicable, details of any additional security or collateral provided
6. Payment Schedule: If applicable, schedule of guaranteed payments or repayment terms
7. Conditions Precedent Documents: List and copies of required documents to be provided before the guarantee becomes effective
Authors
Banking & Financial Services
Real Estate & Construction
Manufacturing & Industrial
Trading & Commerce
Healthcare
Hospitality & Tourism
Technology & Telecommunications
Energy & Utilities
Transportation & Logistics
Retail
Legal
Finance
Treasury
Risk Management
Compliance
Corporate Banking
Credit Administration
Islamic Banking
Corporate Secretarial
Security & Documentation
Chief Financial Officer
Finance Director
Legal Counsel
Corporate Lawyer
Banking Manager
Credit Risk Manager
Compliance Officer
Treasury Manager
Financial Controller
Company Secretary
Risk Officer
Senior Loan Officer
Corporate Banking Manager
Islamic Banking Specialist
Security Documentation Officer
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