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A Guarantee Fee Agreement is essential in commercial transactions where one party (the guarantor) provides a guarantee in favor of another party and receives compensation for this service. This document is commonly used in Malaysia when parent companies guarantee subsidiaries' obligations, financial institutions provide guarantees for business transactions, or in project finance scenarios. The agreement details the fee structure, payment terms, duration of the guarantee, and parties' rights and obligations, all while ensuring compliance with Malaysian legal requirements. It's particularly important in securing financial arrangements and providing clarity on the commercial terms of the guarantee relationship.

1. Parties: Identifies the parties to the agreement: the Guarantor (providing the guarantee), the Principal (paying the fee), and any other relevant parties

2. Background: Sets out the context of the agreement, including reference to the main facility/agreement being guaranteed

3. Definitions: Defines key terms used throughout the agreement

4. Guarantee Fee: Specifies the guarantee fee amount or calculation method

5. Payment Terms: Details the timing, method, and currency of guarantee fee payments

6. Duration: Specifies the term of the guarantee fee arrangement and any renewal provisions

7. Guarantor's Rights: Outlines the rights of the guarantor, including right to receive fees and information

8. Principal's Obligations: Lists the obligations of the principal, including payment and information provision

9. Representations and Warranties: Standard representations and warranties from both parties

10. Events of Default: Defines events that constitute default and their consequences

11. Termination: Circumstances and process for terminating the agreement

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

13. Notices: Details how formal notices should be given between parties

14. General Provisions: Standard boilerplate provisions including amendments, waivers, and severability