Project Finance Loan Agreement Template for United Arab Emirates

The Project Finance Loan Agreement is a sophisticated financing instrument used in the United Arab Emirates for funding large-scale infrastructure, energy, and development projects. It is specifically designed for non-recourse or limited-recourse financing where the loan is primarily secured by the project assets and cash flows. This document type is essential when implementing complex projects requiring substantial capital investment, particularly in sectors such as energy, infrastructure, and real estate development. The agreement must comply with UAE legal requirements, including Federal Laws governing banking, security, and commercial transactions, while potentially incorporating Islamic finance principles where applicable. The document includes detailed provisions for project implementation, monitoring, and control mechanisms, making it suitable for projects where lenders require significant oversight of the project's development and operation.

1. Parties: Identification of the lender(s), borrower, and any other key parties such as security agent, facility agent, and sponsors

2. Background: Description of the project, purpose of the facility, and basic transaction structure

3. Definitions and Interpretation: Comprehensive definitions of terms used in the agreement and interpretation clauses

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

5. Conditions Precedent: Conditions that must be satisfied before drawdown, including project-specific requirements

6. Drawdown: Procedures and requirements for utilization of the facility

7. Repayment: Terms of repayment, including scheduled repayments and mandatory prepayments

8. Interest: Interest calculation, periods, and payment provisions

9. Fees: All applicable fees including arrangement, commitment, and agency fees

10. Tax Provisions: Tax-related provisions including gross-up obligations and VAT considerations

11. Project Undertakings: Specific undertakings related to the project, including construction and operation obligations

12. Representations and Warranties: Standard and project-specific representations and warranties

13. Information Undertakings: Requirements for financial and project-related reporting

14. General Undertakings: General covenants including financial covenants and project-specific requirements

15. Events of Default: Comprehensive list of events triggering default and consequences

16. Security: Description of security package and enforcement mechanisms

17. Agency and Security Agent Provisions: Roles and responsibilities of facility agent and security agent

18. Changes to Parties: Transfer and assignment provisions

19. Payment Mechanics: Administrative provisions regarding payments

20. Set-off: Rights of set-off and their application

21. Notices: Communication procedures and contact details

22. Calculations and Certificates: Provisions regarding calculations and certificates

23. Partial Invalidity: Severability provisions

24. Remedies and Waivers: Rights and remedies of the parties

25. Amendments and Waivers: Procedures for amendments and waivers

26. Governing Law: UAE law as governing law and jurisdiction provisions

27. Enforcement: Enforcement provisions including submission to jurisdiction and appointment of process agents