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Line Of Credit Agreement Template for Malaysia

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Key Requirements PROMPT example:

Line Of Credit Agreement

"I need a Line of Credit Agreement for my manufacturing company to secure a RM 5 million facility from Bank Negara Malaysia, with quarterly interest payments and property collateral as security, to be effective from March 2025."

Document background
The Line of Credit Agreement is a crucial financing document used in Malaysian banking practice when establishing flexible borrowing arrangements. It enables borrowers to access funds up to a pre-approved limit on a revolving basis, making it particularly suitable for managing working capital and ongoing operational needs. The agreement must comply with Malaysian banking regulations, including the Financial Services Act 2013 and Bank Negara Malaysia guidelines. It contains essential provisions covering facility terms, security arrangements, borrower obligations, and enforcement mechanisms. This document is commonly used by businesses seeking flexible financing solutions and banks providing revolving credit facilities, requiring careful consideration of both commercial and regulatory requirements under Malaysian law.
Suggested Sections

1. Parties: Identifies the lender and borrower with complete legal names and registration/identification details

2. Background: Explains the context of the agreement and the parties' intention to enter into a line of credit arrangement

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

4. Facility Details: Specifies the credit limit, purpose, availability period, and nature of the revolving facility

5. Interest and Fees: Details the interest rate (including calculation method), commitment fees, and other applicable charges

6. Drawdown Provisions: Specifies the procedures, conditions, and requirements for drawing down the credit facility

7. Repayment Terms: Outlines the repayment obligations, minimum payments, and payment schedules

8. Representations and Warranties: States the borrower's assertions regarding their legal status, capacity, and financial condition

9. Covenants: Lists the borrower's positive and negative obligations throughout the facility period

10. Events of Default: Defines circumstances that constitute default and the lender's rights upon occurrence

11. Termination: Specifies conditions and procedures for terminating the facility

12. General Provisions: Contains standard clauses including notices, amendments, governing law, and jurisdiction

Optional Sections

1. Security Arrangements: Required when the facility is secured by collateral, detailing the security structure and enforcement rights

2. Guarantee Provisions: Included when there are corporate or personal guarantors for the facility

3. Insurance Requirements: Necessary when specific insurance coverage is required for secured assets or the borrower

4. Special Drawdown Conditions: Used for facilities with industry-specific or unique drawdown requirements

5. Cross-Default Provisions: Included when the borrower has other significant financial obligations or facilities

6. Islamic Banking Provisions: Required when the facility needs to comply with Shariah principles

7. Foreign Exchange Provisions: Necessary when the facility involves multiple currencies

8. Syndication Provisions: Included when the facility involves multiple lenders

Suggested Schedules

1. Facility Terms Schedule: Details specific financial terms including credit limit, interest rates, fees, and charges

2. Conditions Precedent: Lists all documents and conditions required before the facility becomes available

3. Drawdown Request Form: Standard form for requesting drawdowns under the facility

4. Security Documents List: Comprehensive list of all security documents related to the facility

5. Repayment Schedule: If applicable, details the minimum repayment schedule and calculation method

6. Compliance Certificate: Template for periodic financial covenant compliance reporting

7. Fee Schedule: Detailed breakdown of all applicable fees and charges

8. Permitted Security Interests: List of pre-approved security interests or liens that may exist

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 and Financial Services

Manufacturing

Real Estate and Construction

Retail and Commerce

Technology and Communications

Healthcare

Agriculture

Energy and Resources

Transportation and Logistics

Professional Services

Relevant Teams

Legal

Finance

Treasury

Risk Management

Compliance

Corporate Banking

Credit Analysis

Operations

Company Secretarial

Business Development

Relevant Roles

Chief Financial Officer

Finance Director

Treasury Manager

Credit Risk Manager

Legal Counsel

Compliance Officer

Relationship Manager

Credit Analyst

Corporate Banking Manager

Finance Manager

Company Secretary

Risk Officer

Banking Operations 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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