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Share Charge Agreement Template for Malaysia

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Key Requirements PROMPT example:

Share Charge Agreement

"I need a Share Charge Agreement under Malaysian law where ABC Manufacturing Sdn Bhd (as Chargor) will charge 60% of its shares in XYZ Industries Sdn Bhd to secure a RM 10 million facility from Global Bank Berhad, with the security to be registered by March 2025."

Document background
A Share Charge Agreement is commonly used in Malaysian financing transactions where shares are provided as security for loans or other financial obligations. This document is essential in both corporate lending and investment scenarios, creating a fixed charge over shares that provides the chargee with security rights and enforcement options. The agreement must comply with Malaysian law, particularly the Companies Act 2016 and relevant securities regulations, requiring registration with the Companies Commission of Malaysia within 30 days of creation. It typically includes detailed provisions regarding the maintenance of the security, voting rights, dividends, and enforcement mechanisms. The document is particularly important in acquisition financing, corporate restructuring, and general corporate lending where share security is required.
Suggested Sections

1. Parties: Identifies the Chargor (share owner), Chargee (security recipient), and the Company whose shares are being charged

2. Background: Explains the context of the security arrangement and references any underlying facility or obligation being secured

3. Definitions and Interpretation: Defines key terms and establishes interpretation principles, including specific security and share-related terminology

4. Creation of Charge: Establishes the fixed charge over the shares, including the scope of charged property

5. Representations and Warranties: Chargor's confirmations regarding ownership, authority, and status of shares

6. Covenants: Chargor's obligations regarding the charged shares, including voting rights, dividends, and share maintenance

7. Security Perfection: Requirements for registering and perfecting the security, including delivery of share certificates and transfer forms

8. Continuing Security: Confirms the security is continuing and covers future obligations

9. Enforcement: Rights and procedures for enforcing the security, including power of sale and appointment of receivers

10. Power of Attorney: Appointment of Chargee as attorney to perfect or enforce security

11. Payments and Proceeds: Treatment of dividends, voting rights, and enforcement proceeds

12. Miscellaneous: Standard boilerplate provisions including notices, amendments, and governing law

Optional Sections

1. Further Advances: Include when the security may secure future advances or facilities

2. Currency Provisions: Required for cross-border transactions or multiple currency facilities

3. Tax Provisions: Include detailed tax provisions when significant tax implications exist

4. Security Agent Provisions: Required when security is held by an agent for multiple beneficiaries

5. Regulatory Compliance: Additional provisions for regulated entities or when specific regulatory approvals are required

6. Inter-creditor Provisions: Include when security is shared among multiple creditors

Suggested Schedules

1. Details of the Charged Shares: Schedule listing share details including certificate numbers, number of shares, and class

2. Form of Share Transfer Form: Blank share transfer form to be signed by Chargor

3. Form of Directors' Resolution: Pro-forma resolution approving share transfer upon enforcement

4. Notice of Charge: Form of notice to be given to the Company whose shares are charged

5. Shareholders' Resolutions: Any required shareholder approvals or waivers

6. Registration Requirements: Checklist of registration requirements and forms for Companies Commission of Malaysia

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



























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Relevant Industries

Banking and Financial Services

Investment Management

Private Equity

Corporate Finance

Real Estate

Manufacturing

Technology

Energy

Infrastructure

Healthcare

Retail

Telecommunications

Relevant Teams

Legal

Finance

Compliance

Corporate Secretarial

Risk Management

Credit

Investment

Corporate Finance

Operations

Relevant Roles

Legal Counsel

Corporate Lawyer

Finance Director

Chief Financial Officer

Company Secretary

Compliance Officer

Transaction Manager

Security Trustee

Investment Manager

Corporate Finance Manager

Risk Manager

Credit Officer

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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