Equipment Finance Agreement for United Arab Emirates

Equipment Finance Agreement Template for United Arab Emirates

A comprehensive legal agreement governed by UAE law that establishes the terms and conditions for financing the purchase or lease of equipment. The document incorporates requirements under UAE Civil Code and Commercial Transactions Law, addressing financing terms, security interests, and compliance with Central Bank regulations. It details payment obligations, equipment specifications, security arrangements, and enforcement mechanisms while ensuring compliance with UAE's financial services regulations and security registration requirements.

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What is a Equipment Finance Agreement?

The Equipment Finance Agreement is a critical document used in the UAE for businesses seeking to finance the acquisition of equipment while complying with local laws and regulations. It serves as the primary contract between a financial institution and a borrower, structured in accordance with UAE Civil Code (Federal Law No. 5 of 1985) and Commercial Transactions Law (Federal Law No. 18 of 1993). The agreement covers essential aspects including equipment specifications, financing terms, security arrangements, maintenance requirements, and enforcement provisions. It's particularly relevant in the UAE's dynamic business environment where equipment financing plays a crucial role in business growth and infrastructure development. The document must comply with Central Bank regulations and recent legislation regarding security interests in movable property.

What sections should be included in a Equipment Finance Agreement?

1. Parties: Identification of the finance provider and the borrower/lessee

2. Background: Context of the agreement including purpose of financing and brief description of equipment

3. Definitions: Definitions of key terms used throughout the agreement

4. Equipment Details: Detailed description of the equipment being financed

5. Facility Terms: Key financial terms including amount, interest rate, payment schedule

6. Conditions Precedent: Conditions that must be satisfied before the agreement becomes effective

7. Representations and Warranties: Statements of fact and assurances given by the borrower

8. Covenants: Ongoing obligations of the borrower during the term of the agreement

9. Security: Details of security interest over the equipment and any additional security

10. Insurance: Requirements for insurance coverage of the equipment

11. Events of Default: Circumstances constituting default and consequences

12. Enforcement Rights: Rights and remedies of the finance provider upon default

13. Boilerplate Provisions: Standard contract clauses including governing law, notices, assignment

What sections are optional to include in a Equipment Finance Agreement?

1. Guarantees: Required when personal or corporate guarantees are provided as additional security

2. Import/Export Provisions: Required when equipment is being imported or may be exported

3. Maintenance and Operation: Detailed requirements for equipment maintenance when financer requires specific standards

4. Islamic Finance Provisions: Required when the financing needs to be Sharia-compliant

5. Tax Provisions: Detailed tax arrangements when equipment involves significant tax implications

6. Assignment and Syndication: Required when the finance provider may want to assign or syndicate the financing

7. Step-In Rights: Required for high-value equipment where lender may need to take control of equipment operation

What schedules should be included in a Equipment Finance Agreement?

1. Equipment Schedule: Detailed technical specifications and identification of equipment

2. Payment Schedule: Detailed breakdown of payment amounts and dates

3. Condition Report: Initial condition report of equipment at time of financing

4. Form of Transfer/Bill of Sale: Standard form for transferring title to equipment

5. Insurance Requirements: Detailed insurance specifications and requirements

6. Permitted Locations: Approved locations for equipment operation/storage

7. Form of Drawdown Notice: Standard form for requesting disbursement of funds

8. Security Particulars: Details of security registration and perfection requirements

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Publisher

Genie AI

Document Type

Financing Agreement

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Manufacturing

Construction

Healthcare

Transportation

Logistics

Oil & Gas

Mining

Agriculture

Technology

Telecommunications

Industrial Processing

Marine

Aviation

Real Estate Development

Retail

Hospitality

Relevant Teams

Legal

Finance

Treasury

Risk Management

Operations

Procurement

Asset Management

Compliance

Credit

Commercial

Relevant Roles

Chief Financial Officer

Finance Director

Treasury Manager

Equipment Finance Manager

Legal Counsel

Commercial Director

Risk Manager

Credit Manager

Operations Director

Procurement Manager

Asset Manager

Facility Manager

Financial Controller

Compliance Officer

Contract Administrator

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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