Note Purchase Agreement for United Arab Emirates

Note Purchase Agreement Template for United Arab Emirates

A Note Purchase Agreement under UAE law is a comprehensive legal document that governs the issuance and purchase of debt instruments (notes) between an issuer and purchaser(s). This agreement, structured in compliance with UAE Federal laws and potentially relevant free zone regulations, outlines the terms and conditions of the note issuance, including purchase price, interest rates, payment schedules, and security arrangements. The document incorporates specific UAE regulatory requirements, including those from the UAE Central Bank and Securities and Commodities Authority where applicable, while potentially accommodating both conventional and Islamic finance structures.

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What is a Note Purchase Agreement?

The Note Purchase Agreement is a crucial document used in UAE financial transactions when an entity wishes to raise capital through the issuance of debt instruments. This agreement type is particularly relevant in the UAE's dynamic business environment, where both conventional and Islamic financing options are prevalent. The document must comply with UAE Federal Law No. 18 of 1993 (Commercial Transactions Law) and UAE Federal Law No. 14 of 2018 (UAE Central Bank Law), among others. The Note Purchase Agreement typically includes detailed terms about the notes being issued, purchase conditions, representations and warranties, covenants, events of default, and security arrangements. It's commonly used in corporate financing, project funding, and business expansion scenarios, requiring careful consideration of UAE regulatory requirements and market practices.

What sections should be included in a Note Purchase Agreement?

1. Parties: Identification of the issuer, purchaser(s), and any guarantors or trustees

2. Background: Context of the transaction, including purpose of the note issuance

3. Definitions: Defined terms used throughout the agreement

4. Purchase and Sale of Notes: Core transaction terms including purchase price, interest rate, and payment terms

5. Closing Conditions: Conditions precedent to the purchase, including required documentation and approvals

6. Representations and Warranties: Statements of fact by the issuer regarding its legal status, authority, and financial condition

7. Covenants: Ongoing obligations of the issuer during the term of the notes

8. Events of Default: Circumstances constituting default and consequences thereof

9. Payment Provisions: Details of payment mechanics, currency, and payment dates

10. Transfer Restrictions: Limitations on transfer of notes and required procedures

11. Amendments and Waivers: Procedures for modifying agreement terms

12. Notices: Communication requirements and contact details

13. Governing Law and Jurisdiction: UAE law provisions and jurisdiction specifications

14. Execution: Signature blocks and execution requirements

What sections are optional to include in a Note Purchase Agreement?

1. Shariah Compliance: Required if the notes need to be Shariah-compliant, detailing compliance structure

2. Security: Include if the notes are secured by specific assets or guarantees

3. Tax Considerations: Include if specific tax treatments or obligations apply

4. Registration Rights: Include if notes may be registered with securities authorities

5. Subsidiary Guarantees: Include if subsidiaries are providing guarantees

6. Redemption Provisions: Include if early redemption options are available

7. Interest Rate Adjustment: Include if interest rate can be adjusted based on specific triggers

8. Free Zone Provisions: Include if transaction occurs within UAE free zones

What schedules should be included in a Note Purchase Agreement?

1. Form of Note: Template of the actual note certificate

2. Payment Schedule: Detailed payment dates and amounts

3. Financial Covenants: Specific financial ratios and requirements

4. Disclosure Schedule: Exceptions to representations and warranties

5. Security Details: Description of any collateral or security arrangements

6. Required Approvals: List of regulatory and corporate approvals needed

7. Subsidiary Information: Details of relevant subsidiaries if applicable

8. Calculation Methods: Detailed procedures for calculating interest and other amounts

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

Purchase Agreement

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Banking and Financial Services

Real Estate and Construction

Energy and Utilities

Healthcare

Technology and Telecommunications

Manufacturing

Retail and Consumer Goods

Infrastructure Development

Transport and Logistics

Hospitality and Tourism

Relevant Teams

Legal

Finance

Treasury

Compliance

Risk Management

Corporate Secretariat

Investment

Business Development

Corporate Finance

Executive Management

Board of Directors

Relevant Roles

Chief Financial Officer

Finance Director

Treasury Manager

Legal Counsel

Corporate Secretary

Investment Manager

Compliance Officer

Risk Manager

Financial Controller

Business Development Director

Corporate Finance Manager

Managing Director

CEO

Board Member

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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