Revolving Credit Facility Agreement Template for Saudi Arabia

The Revolving Credit Facility Agreement is a fundamental financing document used in Saudi Arabia when a borrower requires flexible access to funding on a revolving basis. This agreement is particularly relevant for businesses seeking working capital finance or requiring ongoing access to credit while maintaining Shariah compliance. The document encompasses comprehensive terms governing the facility, including drawdown mechanics, profit calculations, security arrangements (if applicable), and compliance requirements under Saudi law. It is structured to comply with both SAMA regulations and Islamic finance principles, typically utilizing structures such as Murabaha or Tawarruq to achieve the revolving nature of the facility. The agreement is essential for establishing a clear legal framework for the ongoing financial relationship between Saudi-based financial institutions and their corporate clients.

1. Parties: Identification of the finance parties (including facility agent if applicable), the borrower(s), and any guarantors

2. Background: Context of the facility and confirmation of Shariah compliance

3. Definitions and Interpretation: Definitions of terms, interpretation principles, and Shariah principles applicable to the agreement

4. The Facility: Details of the revolving facility, including amount, purpose, and availability period

5. Conditions Precedent: Conditions to be satisfied before utilization, including Shariah compliance documentation

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

7. Repayment and Prepayment: Terms for repayment, prepayment rights and obligations

8. Profit Rate and Fees: Shariah-compliant profit rate calculation, fees, and payment provisions

9. Islamic Finance Terms: Specific provisions ensuring Shariah compliance, including structure of the underlying Islamic finance arrangement

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

11. Information Undertakings: Ongoing information obligations of the borrower

12. General Undertakings: Positive and negative covenants of the borrower

13. Events of Default: Circumstances constituting default and consequences

14. Changes to Parties: Transfer and assignment provisions

15. Payment Mechanics: Payment procedures, currency provisions, and set-off rights

16. Notices: Communication procedures between parties

17. Governing Law and Enforcement: Saudi Arabian law as governing law and enforcement provisions