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Heter Iska Agreement

Pursuant to the decision of the Board of Directors and Management of:

(Together “Loanpad”)

we the undersigned hereby agree to, stipulate, undertake and invoke, in the name of Loanpad and its affiliates, including all its offices, departments, divisions, and subsidiary companies, and including all its branches thereof, whether in the UK or UK Territories, or other foreign countries including off-shore entities, this Heter lska Agreement:

  1. The following definitions apply to the Parties outlined above in this Heter Iska Agreement.

    • “The Platform Investors Of Loanpad Limited” means any person classified as an Investor in the Loanpad Investor Terms and Conditions and to whom the Jewish Interest Laws apply.
    • “The Platform Borrowers of Loanpad Limited” means any person classified as a Borrower in the Loanpad Investor Terms and Conditions and to whom the Jewish Interest Laws apply.
  2. All financial and money matters in which we will be involved, or in which an agent of ours will be involved on our behalf, whether acting as an individual or a company or companies, whether us acting on behalf of an individual or individuals or a corporation, company, partnership, or other such entity, whether dealing with other individuals or with companies, corporations, or their agents, regarding whatever we give and/or pay to them or they will owe us, or regarding whatever we accept and/or receive from them or we will owe them, concerning all types of credits, deposits, debts, sureties, liens, guarantees, mortgages, rentals, savings, dividends, winnings, currency exchanges, commodities, bonds, swaps, and shares, including proprietorship, brokerage, commissions, trusts, and agents acting on my behalf, including payments, taxes, fees, property tax, sales, and purchases, whether by credit, payment up-front, wire, transfer, receipt of any type of service, any other form of payment, any work received, any exchange in-kind, and the like, and regarding the receipt of any products or anything of monetary value, whether received as a loan, sale, or any other form of transaction, regarding all the above mentioned, anything that could possibly involve any type of agreement that is prohibited in any way according to Jewish Ribbis (usury) Law, even if the words “loan,” “interest,” “payment for,” “remaining debt,” or any similar terminology are written in any document, receipt, or the like, all forms of transactions specified above will be legally considered instead as bound to the terms of this Heter Iska convention as specified below, and any terminology written in any other document has no power to nullify the conditions specified in this Heter Iska convention which attests that the Heter Iska laws applies to all transactions.
  3. All the above mentioned will be in the possession of the recipient or the debtor (hereafter referred to as the “recipient”) under the terms of the Heter Iska as instituted according to Jewish law. The investment shall be considered as an ISKA (joint venture), owned jointly by the investor and recipient. Profits realised from this investment will be divided equally, the recipient and the investor will each take fifty percent. With regard to losses resulting from the investment, the recipient will take a forty five percent loss, and the investor will take the fifty five percent loss. Nevertheless, recipient is fully responsible as a paid guard (Shomer Sachar), as specified by Jewish law, if the funds are otherwise lost or stolen.
  4. It is further agreed upon that if any transactions are made for which the above conditions are insufficient to avoid payments of the nature that are forbidden according to (usury) Ribbis law, or if due to the nature of the recipient’s business it is known in advance that the investor will not receive a portion of the profits as mentioned below, then such an investment will legally be considered entirely as a PIKADON (managed deposit or investment), wholly owned by the investor and for which the recipient acts only as an agent, and the recipient will be responsible for loss or theft as dictated by Jewish law for a paid guard (Shomer Sachar). The investor will receive one hundred percent of the profits, and the recipient will receive a payment of one pound as payment for his services.
  5. In such a case where the ISKA/PIKADON agreement becomes necessary after the loan has been given, i.e. through a change of the lender by withdrawal of an investors monies and replacement with the monies of another (Jewish) investor, the monies advanced by the second lender will actually be reckoned as repayment of the loan (or part of the loan) to the primary lender, whereas monies subsequently owed to the secondary lender will hence be "invested" in accordance to the stipulations of this ISKA/PIKADON.
  6. Whether the transaction is considered an ISKA (joint venture) or a PIKADON (managed deposit or investment), the recipient agrees to act in all business ventures in the best and most advantageous manner for generating profits, whether dealing with merchandise or real estate, whether involving business ventures that are already in progress, or regarding future business ventures. In exchange for the money or debt, the investor will acquire a portion in the existing and choice merchandise and business interests of the recipient, as determined by the appraisal of experts chosen by the investor. Likewise, in every profit generating business acquisition made by the recipient from now on, recipient will acquire a portion on behalf of the investor and for the investor’s best interest, all in the best possible manner.
  7. Everything mentioned above applies even if the investment was intended for a specific purpose. Despite any written agreements, it is agreed that whoever is in possession of the investment shall act in all his business dealings for the best interest of the ISKA/PIKADON venture, even if the rights and registration of the business ventures to the property acquired can/shall be registered in the name of the recipient.
  8. It is upon the recipient to prove that he dealt with the money invested with him faithfully, according to the enactment of the Mahara”m, and if he should claim that the principal of the investment has been lost in whole or part, he shall be believed only if his claim is supported by at least two suitable and trustworthy witnesses in accordance with Jewish Orthodox Law and acceptable by the Beth Din of the UOHC. He will not be believed that he does not own any other property and/or investments that could be collected as collateral for the investment, and his claim to the amount of profits or the lack of profits thereof will be believed only by the way of a Solemn Oath (Shevua Chamurah) made in accordance with Jewish Orthodox Law in the Beth Din of the UOHC. The recipient must also exhibit a detailed explanation, ledger, and whatever other documentation is in his possession, all records, and authorized statements, and all testimony and proofs whatsoever. However no circumstantial evidence will be accepted to acquit the recipient from the above-mentioned oath. The only evidence that will be accepted is suitable and trustworthy witnesses in accordance with Jewish law. Regarding business dealings in which the recipient was not personally involved, an oath by the employee made with the above-mentioned conditions will be equally acceptable.
  9. Moreover, it is agreed that the Recipient shall be required to notify the Investor in writing of any lack of profit and/or loss up to the last business day of the month according to the Hebrew calendar which shall be deemed to be the date of repayment. Failure to provide notification within seven days of the aforesaid date shall be deemed an admission by the Recipient that the ISKA/PIKADON actually realised a profit and the Recipient shall not be able to claim that the transaction sustained a loss or did not realize a profit by the aforesaid date, in accordance with the ruling of the Chachmas Adam. Moreover, it is also agreed that upon making the above notification the Recipient shall be required to immediately pay the Investor, the part of the loan and the parts of the deposit which, according to the Recipient, was not lost. In the event that he faiIs to perform, the Court of Law (Beth Din) may rule as it sees acceptable.
  10. However, it is agreed upon that if the recipient gives the investor that certain amount, as agreed between them, in lieu of investors share of the profits, including but not limited to changes in the consumer’s price index, money exchange rates, and the like, gifts, grants, deliveries of merchandise paid in advance, or for sale on credit payments expected for the sale of merchandise, and the like, then he will be exempt from producing any proof of his business dealings. The remainder of the profits will belong exclusively to the recipient.
  11. Likewise, it is agreed upon that all payments or gifts that are assumed before the start of this ISKA/PIKADON by the recipient to the investor will only be considered as repayment for the investment, and in the event, it becomes evident that the recipient is not obligated in this payment according to the terms of this contract, the amount given will be deducted from the principle investment.
  12. Likewise, it is agreed upon that if the payment is withheld beyond the time agreed upon by both parties, then the ISKA/PIKADON will be extended according to the terms agreed upon above until full payment is received. All guarantees which might be subject to Ribbis payments are bound to the terms of agreement written within this contract.
  13. If more than one person is signed as the recipient, then the term “recipient” in this document should be understood as “recipients.” Likewise, if more than one person is signed as the investor, then the term “investor” in this document should be understood as “investors.” All involved, individually and collectively, are obligated to uphold this contract, and in the most advantageous manner for generating profits.

All the terms of agreement stated above are final and obligate ourselves and any businesses that we own. It is explicitly agreed that if for whatever reason the recipient or the investor is unfamiliar with the mechanism of Heter Iska and ISKA/PIKADON, or even completely ignorant of it, they will act in accordance with the Heter Iska as specified in this contract, and all the obligations and benefits which apply to the investor of an ISKA/PIKADON or to the recipient of an ISKA/PIKADON apply to them, as specified in this contract since, according to this contract, we and any company that we own will not deal in any financial matters which could possibly contain payments with the prohibition of Ribbis, and whoever does business with us, and with any of the companies that we own, acts in accordance with this contract. This Heter Iska Convention is an inseparable part of all contracts, agreements, and obligations of any company or business that is under our management or that we own, and this contract is legally binding in every manner. To reinforce everything stated above, we are setting it forth in writing as a reminder, and openly publicizing these terms of agreement. All the above has been made in conjunction with an acquisition of real estate, in the presence of a prominent Jewish court of law, in the best possible manner according to Jewish law, as instituted by our sages, and all conditions within this document shall be firm and abiding.

To further validate this transaction, and related conditions and enforcement thereof, we hereby certify that we have executed a Kinyan Sudar properly according to Halacha and that we hereby sign our names.

Signed copy available upon request.


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