Can this agreement be signed electronically?

Yes. Electronic signatures are generally enforceable in the U.S. under the ESIGN Act (15 U.S.C. ch. 96) and UETA where adopted, provided there is intent, consent, attribution, and reliable record retention. Exceptions like wills and certain court filings may apply.

Does Murabaha require Sharia certification?

Most lenders require documented Sharia board approval or a compliance certificate confirming the transaction’s trade-based structure and lack of interest. Include the certification clause and keep supporting opinions on file to demonstrate compliance during audits or regulatory review.

Are notarization or witnesses required?

Notary or witness requirements depend on state law and the transaction type. Many states do not require notarization for commercial contracts, but real estate or UCC perfection may impose recording or signature acknowledgment needs. Check state statutes or consult counsel.

How should payments be allocated (profit vs principal)?

Specify whether each installment applies first to profit then principal or vice versa. Clear allocation prevents accounting disputes, affects tax reporting, and clarifies default remedies. Include amortization table and sample payment schedule to avoid interpretation issues.

Can UCC financing statements be filed electronically?

Yes — most states accept electronic UCC filings through the state filing system. Timely filing perfects security interests; include accurate debtor and collateral descriptions. Confirm state-specific procedures and fee schedules before submitting a financing statement.

What are common drafting pitfalls to avoid?

Common issues include ambiguous asset descriptions, unclear profit calculation formulas, missing perfection steps for collateral, absent Sharia certification clauses, and inconsistent signatory authority. Address these explicitly and have counsel and a Sharia advisor review before execution.

Electronic Signature
Templates
Other
Murabaha Facility Agreement

Murabaha Facility Agreement

This template is fully customizable. Edit the text, fill out the fields, and send it for signature. Give it a try!

Copyright Security Agreement Executed in Connection with Loan Agreement

This Copyright Security Agreement (this Agreement) is made on this , between , a corporation organized and existing under the laws of the state of , with its principal office located at (street address, city, county, state, zip code), referred to herein as Assignor, and , a corporation organized and existing under the laws of the state of , with its principal office located at (street address, city, county, state, zip code), referred to herein as Secured Party.

Capitalized terms not otherwise defined in this Agreement have the meanings set forth in the Loan Agreement, dated , between Assignor and Secured Party (the Loan Agreement).

Pursuant to the Loan Agreement, Assignor is granting a security interest to Secured Party in certain collateral, including the Copyrights (as defined below).

Now, therefore, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are acknowledged, Assignor and Secured Party agree as follows:

1. Grant of Security Interest

A. As security for the full and prompt payment and performance when due (whether at the stated maturity, by acceleration, or otherwise) of all the Obligations, the Assignor grants, assigns, and transfers to Secured Party, a continuing security interest in all of the right, title, and interest of Assignor in, to, and under the United States copyrights and all registrations and applications to register the same in the United States Copyright Office, and all renewals of the same (the Copyrights) more particularly set forth on Schedule A, which is attached to as Schedule A and incorporated in this Agreement by reference.

B. The rights and remedies of Secured Party with respect to the security interest granted in this Agreement are in addition to those set forth in the Loan Agreement and the other Credit Documents. Each right, power, and remedy of Secured Party provided for in this Agreement, in the Loan Agreement, and in the other Credit Documents, now or later existing at law or in equity, shall be cumulative and concurrent and shall be in addition to every right, power, or remedy provided for in this Agreement. The exercise by Secured Party of any one or more of the rights, powers, or remedies provided for in this Agreement, in the Loan Agreement, and in the other Credit Documents, now or later existing at law or in equity, shall not preclude the simultaneous or later exercise by Secured Party of any or all other rights, powers, or remedies.

3. No Waiver

The failure of either party to this Agreement to insist upon the performance of any of the terms and conditions of this Agreement, or the waiver of any breach of any of the terms and conditions of this Agreement, shall not be construed as subsequently waiving any such terms and conditions, but the same shall continue and remain in full force and effect as if no such forbearance or waiver had occurred.

4. Governing Law

This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of .

5. Notices

Any notice provided for or concerning this Agreement shall be in writing and shall be deemed sufficiently given when sent by certified or registered mail if sent to the respective address of each party as set forth at the beginning of this Agreement.

6. Entire Agreement

This Agreement shall constitute the entire agreement between the parties and any prior understanding or representation of any kind preceding the date of this Agreement shall not be binding upon either party except to the extent incorporated in this Agreement.

7. Modification of Agreement

Any modification of this Agreement or additional obligation assumed by either party in connection with this Agreement shall be binding only if placed in writing and signed by each party or an authorized representative of each party.

8. Assignment of Rights

The rights of each party under this Agreement are personal to that party and may not be assigned or transferred to any other person, firm, corporation, or other entity without the prior, express, and written consent of the other party.

9. Counterparts

This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all of which together shall constitute but one and the same instrument.

WITNESS our signatures as of the day and date first above stated.

Assignor

Secured Party

Schedule A

What a Murabaha Facility Agreement Is and What It Covers

The Murabaha Facility Agreement is a financing contract used in Islamic finance where a financier purchases specified assets and resells them to a customer at a disclosed cost-plus profit margin with deferred payment terms. This agreement documents the description of assets, purchase and resale steps, the agreed profit mark-up, payment schedule, security or collateral, representations and warranties, events of default, remedies, and Sharia compliance measures such as required certifications or advisory board approvals. In practice it governs the operational steps, credit limits, drawing mechanics, and reporting obligations that structure a Murabaha facility between lender and borrower.

Why a Well-Drafted Murabaha Facility Agreement Matters

A well-drafted Murabaha Facility Agreement clarifies commercial terms, ensures documented Sharia compliance, allocates credit and security responsibilities, and reduces disputes by setting clear repayment, default, and repossession procedures. It provides enforceable evidence of the cost-plus sale and the parties’ obligations under U.S. contract law.

Who Typically Prepares and Signs This Agreement

Banks, Islamic financial institutions, corporate treasury teams, and borrowers use Murabaha Facility Agreements to document cost-plus asset financing and facility mechanics.

Islamic banks and financiers — structure commodity purchase and resale, manage profit margin and payment schedule.
Corporate borrowers — access Sharia-compliant working capital without interest-based loans or conventional banking structures.
Advisory boards, counsel, and compliance officers — ensure documentation meets Sharia and U.S. regulatory standards.

Legal, compliance, credit, and operations teams should review the agreement to confirm Sharia compliance, security arrangements, and enforceability under applicable law.

Core Provisions You Should Include

Core provisions in a Murabaha Facility Agreement establish the sale mechanics, profit calculation, payment plan, collateral, representations, and dispute-resolution terms.

Sale Mechanics

Describe sequence where financier acquires the asset, title passes, and the resale to the client occurs at disclosed cost-plus markup; include procurement conditions, delivery terms, and transfer of risks and warranties.

Profit Margin

State the exact purchase price, the agreed profit markup, calculation method, rounding rules, and whether the margin is fixed for the facility or adjustable on each transaction.

Payment Schedule

Specify deferred payment dates, installment amounts, grace periods, acceleration clauses, allowed prepayments, late fees, and how payments apply to principal versus profit components under applicable law.

Security & Collateral

Detail collateral description, perfection steps (UCC filings if applicable), priority rights, retention of title clauses, obligations on insurance, and remedies following event of default including repossession process.

Sharia Compliance

Identify Sharia board approvals, required certifications, prohibition of concealed interest, documentation of trade-based nature, and any operational modes to satisfy Islamic legal standards, including murabaha transaction evidence.

Representations

List lender and borrower representations about authority, solvency, ownership of collateral, absence of conflicting agreements, and accuracy of financial statements and disclosures at execution and ongoing obligations.

Step-by-Step Completion Checklist

Follow these steps to complete a Murabaha Facility Agreement accurately and maintain enforceable transaction records under U.S. law.

01

Prepare Documents: Collect corporate records, authorizations, and asset proofs.
02

Draft Terms: Set sale mechanics, profit, schedule, and security.
03

Review Compliance: Have Sharia advisor and counsel review terms.
04

Execute & File: Sign, notarize if required, and file UCC or collateral records.

Configuring an Online Workflow for Consistent Execution

Use this setup table to configure an online Murabaha facility workflow for consistent execution and auditability.

Field	Configuration
Authentication Method	Email with optional SMS OTP; KBA for higher risk.
Conditional Fields	Show purchase details only after asset selection.
Templates	Create reusable templates for recurring facilities and collateral exhibits.
Integrations	Connect to NetSuite, Salesforce, or cloud storage for records.

How Electronic Execution Typically Works

Typical routing steps explain how to send, sign, and archive a Murabaha Facility Agreement using an electronic platform.

Upload: Add document and attach asset exhibits.
Place Fields: Insert signature, date, and conditional fields.
Authenticate Signers: Choose email, SMS OTP, or KBA.
Finalize: Generate certificate of completion and archive.

Technical Considerations for eSigning and Distribution

Technical and platform considerations for eSigning and distributing a Murabaha Facility Agreement securely and compliantly.

File Formats: PDF, DOCX, and flattened signed PDFs.
Authentication: Email, SMS OTP, or SSO options.
Integrations: NetSuite, Salesforce, Box, Google Workspace.

Timing and Deadlines to Track

Key filing and execution deadlines for Murabaha Facility Agreements depend on transaction terms, UCC filing timelines, and notary or RON scheduling.

Execution Date:

Document effective date recorded at signing.

UCC Filing Deadline:

File fixtures or financing statements promptly to perfect security.

Notarization Scheduling:

Allow time for in-person notarization or RON identity proofing.

Payment Dates:

List installment due dates and any final balloon date.

Record Retention:

Retain executed copy per retention schedule and legal requirements.

Common Preparation Mistakes to Avoid

Failing to document the financier’s actual purchase can blur the trade-based nature of Murabaha and expose the parties to claims of concealed interest.
Vague asset descriptions, missing serial numbers, or omitted delivery terms can prevent effective collateral perfection and hinder repossession on default.
Improper profit calculation methods or ambiguous amortization can cause disputes about amounts due and accelerate litigation risk.
Neglecting state-specific notarization, witness, or filing requirements risks procedural challenges that may delay enforcement or perfection.

Legal and Practical Risks of Inaccurate Documents

Contract Invalidity: Ambiguity may render clauses unenforceable.

UCC Loss: Delayed filing creates lien priority loss.

Regulatory Scrutiny: Noncompliance triggers regulatory review.

Tax Exposure: Incorrect profit reporting risks tax penalties.

Reputation Risk: Perceived non-Sharia compliance harms reputation.

Enforcement Delay: Court procedures may be prolonged.

eSignature Pricing and Feature Comparison for Agreement Execution

Compare common eSignature pricing and feature availability useful when executing or distributing Murabaha Facility Agreements electronically.

	signNow	DocuSign	Adobe Sign	PandaDoc	HelloSign
Starting Price	$8/user/mo	$15/user/mo	$14/user/mo	$19/user/mo	$15/user/mo
Free Trial	7-day free trial, no credit card required	Free trial varies by plan and vendor	Free trial varies by plan and vendor	Free trial varies by plan and vendor	Free trial varies by plan and vendor
Bulk Send	Yes, available on Business Premium and above	Yes, available on enterprise plans	Yes, available on business plans	Yes, available on select plans	No, bulk send not available
Audit Trail	Yes, comprehensive audit trail provided	Yes, comprehensive audit trail provided	Yes, comprehensive audit trail provided	Yes, comprehensive audit trail provided	Yes, comprehensive audit trail provided
HIPAA Compliant	Yes (BAA required for HIPAA workflows)	Yes (BAA available upon request)	Yes (BAA availability varies by plan)	No BAA; not HIPAA-ready on standard plans	No BAA; not HIPAA-ready on standard plans

Frequently Asked Questions About Murabaha Facility Agreements

Answers to common questions about completing, signing, and enforcing Murabaha Facility Agreements in the United States.

Need help? Contact support

Can this agreement be signed electronically?
Yes. Electronic signatures are generally enforceable in the U.S. under the ESIGN Act (15 U.S.C. ch. 96) and UETA where adopted, provided there is intent, consent, attribution, and reliable record retention. Exceptions like wills and certain court filings may apply.
Does Murabaha require Sharia certification?
Most lenders require documented Sharia board approval or a compliance certificate confirming the transaction’s trade-based structure and lack of interest. Include the certification clause and keep supporting opinions on file to demonstrate compliance during audits or regulatory review.
Are notarization or witnesses required?
Notary or witness requirements depend on state law and the transaction type. Many states do not require notarization for commercial contracts, but real estate or UCC perfection may impose recording or signature acknowledgment needs. Check state statutes or consult counsel.
How should payments be allocated (profit vs principal)?
Specify whether each installment applies first to profit then principal or vice versa. Clear allocation prevents accounting disputes, affects tax reporting, and clarifies default remedies. Include amortization table and sample payment schedule to avoid interpretation issues.
Can UCC financing statements be filed electronically?
Yes — most states accept electronic UCC filings through the state filing system. Timely filing perfects security interests; include accurate debtor and collateral descriptions. Confirm state-specific procedures and fee schedules before submitting a financing statement.
What are common drafting pitfalls to avoid?
Common issues include ambiguous asset descriptions, unclear profit calculation formulas, missing perfection steps for collateral, absent Sharia certification clauses, and inconsistent signatory authority. Address these explicitly and have counsel and a Sharia advisor review before execution.

Explore Templates

Proposal to Provide Bakery Services License Agreement Food Truck Parking Lease Agreement

be ready to get more

Join over 28 million airSlate SignNow users

Sign Now