Bridge Loan Agreement Template for Saudi Arabia

The Bridge Loan Agreement is utilized in Saudi Arabia when a borrower requires immediate or short-term financing while arranging longer-term funding solutions or awaiting specific events such as asset sales, permanent financing, or capital market issuances. This document is essential in the Saudi Arabian market where all financial products must comply with Islamic finance principles and local banking regulations. The agreement typically includes detailed provisions on facility amount, profit rate, security arrangements, and repayment terms, all structured to ensure Shariah compliance. It is particularly relevant in time-sensitive transactions where traditional financing arrangements may take longer to establish. The document must comply with Saudi Arabian Monetary Authority (SAMA) regulations and the Banking Control Law, while incorporating appropriate Islamic finance structures to replace conventional interest-based mechanisms.

1. Parties: Identification of the lender(s) and borrower(s), including their full legal names, commercial registration numbers, and authorized representatives

2. Background: Context of the bridge loan, including the purpose and temporary nature of the financing

3. Definitions: Definitions of key terms used throughout the agreement, including financial terms and Shariah-compliant concepts

4. Facility: Details of the bridge loan facility, including amount, purpose, and Shariah-compliant structure

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

6. Utilization: Process and requirements for drawing down the facility

7. Repayment and Prepayment: Terms for repayment, including maturity date, prepayment options, and mechanisms

8. Profit Rate and Fees: Shariah-compliant profit rate structure, fees, and payment calculations

9. Security: Details of security arrangements and guarantees

10. Representations and Warranties: Standard and transaction-specific representations and warranties

11. Undertakings: General and financial covenants applicable to the borrower

12. Events of Default: Circumstances constituting default and consequences

13. Shariah Compliance: Specific provisions ensuring compliance with Islamic finance principles

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

15. Notices: Communication procedures between parties

16. Governing Law and Jurisdiction: Saudi Arabian law as governing law and jurisdiction provisions