The Unsecured Loan Agreement Between Two Companies is a fundamental commercial document used when one company wishes to lend money to another without requiring specific assets as security. This agreement is particularly relevant in the UAE business environment where companies often engage in corporate financing arrangements. The document must comply with UAE Federal Laws, including Civil Code (Federal Law No. 5 of 1985) and Commercial Transactions Law (Federal Law No. 18 of 1993), while considering Sharia principles. It's commonly used for working capital financing, business expansion, or short-term funding needs. The agreement includes comprehensive provisions covering loan amount, interest calculations, repayment terms, borrower covenants, and default scenarios, all structured within the UAE legal framework. The unsecured nature of the loan typically requires stronger emphasis on the borrower's creditworthiness and financial representations.

1. Parties: Identification of the Lender and Borrower, including full corporate names, registration numbers, and registered addresses

2. Background: Context of the loan agreement, relationship between parties, and purpose of the loan

3. Definitions and Interpretation: Definitions of key terms used throughout the agreement and rules of interpretation

4. The Loan: Principal amount, purpose, and basic terms of the loan facility

5. Drawdown: Conditions and procedure for drawdown of the loan amount

6. Interest: Interest rate, calculation method, and payment periods in compliance with UAE regulations

7. Repayment: Terms and schedule for repayment of principal and interest

8. Representations and Warranties: Standard corporate representations and specific financial warranties from the Borrower

9. Borrower Covenants: Positive and negative obligations of the Borrower during the loan term

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

11. Acceleration: Lender's rights to demand immediate repayment upon default

12. Payments: Payment mechanics, currency, and treatment of non-business days

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

14. Assignment and Transfer: Rights and restrictions regarding transfer of rights under the agreement

15. Governing Law and Jurisdiction: UAE law as governing law and jurisdiction of UAE courts