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Credit Term Agreement Template for Malaysia

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Key Requirements PROMPT example:

Credit Term Agreement

"I need a Credit Term Agreement for a manufacturing company in Penang, with a credit facility of RM 2 million, requiring monthly repayments starting March 2025, and including machinery as collateral security."

Document background
The Credit Term Agreement serves as a fundamental legal instrument in Malaysian financial transactions, establishing the terms and conditions under which credit is extended from one party to another. This document is essential when businesses or individuals seek credit facilities from financial institutions or other credit providers in Malaysia. It encompasses crucial elements such as credit limits, interest calculations, repayment schedules, and security requirements, all aligned with Malaysian banking regulations and financial laws. The agreement is designed to protect both the credit provider's interests in securing repayment and the borrower's rights under Malaysian consumer protection legislation. It's particularly relevant in commercial lending, trade finance, and business expansion scenarios where formal credit arrangements are necessary.
Suggested Sections

1. Parties: Identifies and provides full details of the creditor and debtor, including registration numbers for companies

2. Background: Explains the context of the credit arrangement and the purpose of the agreement

3. Definitions: Defines key terms used throughout the agreement for clarity and legal certainty

4. Credit Terms: Specifies the credit amount, interest rate, and payment terms

5. Payment Obligations: Details the debtor's obligations regarding payments, including timing and method

6. Interest and Fees: Specifies all applicable interest rates, late payment charges, and administrative fees

7. Security: Describes any security or collateral provided for the credit facility

8. Representations and Warranties: States the legal promises and factual assertions made by both parties

9. Events of Default: Lists circumstances that constitute default and their consequences

10. Termination: Outlines conditions and procedures for terminating the agreement

11. Governing Law and Jurisdiction: Specifies Malaysian law as governing law and establishes jurisdiction for disputes

Optional Sections

1. Insurance Requirements: Required when specific insurance coverage is needed for the credit facility

2. Guarantee Provisions: Included when a third-party guarantee is part of the credit arrangement

3. Cross-Default: Used when the agreement needs to reference other credit facilities or agreements

4. Assignment: Included when either party may need to transfer their rights or obligations

5. Force Majeure: Optional clause for circumstances beyond parties' control affecting performance

6. Refinancing Options: Included when offering possibilities for restructuring the credit terms

Suggested Schedules

1. Schedule 1 - Payment Schedule: Detailed breakdown of payment amounts and due dates

2. Schedule 2 - Interest Rate Calculations: Formula and examples of interest calculations

3. Schedule 3 - Security Details: Detailed description of any collateral or security provided

4. Appendix A - Required Documents: List of documents required for credit approval and maintenance

5. Appendix B - Fee Schedule: Comprehensive list of all applicable fees and charges

6. Appendix C - Contact Information: Contact details for notices and communications between parties

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok³ÉÈ˰æ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions



































Clauses





























Relevant Industries

Banking

Financial Services

Retail

Manufacturing

Construction

Trade and Commerce

Technology

Agriculture

Healthcare

Education

Logistics

Real Estate

Relevant Teams

Legal

Finance

Credit Risk

Compliance

Treasury

Commercial

Corporate Banking

Credit Operations

Collections

Risk Management

Account Management

Relevant Roles

Chief Financial Officer

Finance Director

Credit Manager

Legal Counsel

Compliance Officer

Risk Manager

Financial Controller

Treasury Manager

Account Manager

Credit Analyst

Commercial Director

Banking Relationship Manager

Corporate Finance Manager

Credit Risk Officer

Collections Manager

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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