¶¶Òõ¶ÌÊÓƵ

The Standby Credit Agreement is a crucial financial instrument used in Malaysian commercial transactions where one party requires financial assurance of the other party's performance. It establishes a legally binding arrangement whereby a bank commits to pay a specified sum to a beneficiary upon presentation of compliant documents evidencing a default or non-performance by the applicant. This agreement is particularly relevant in cross-border transactions and is governed by Malaysian law, specifically the Financial Services Act 2013 and related banking regulations. The document typically includes detailed provisions on facility terms, drawing conditions, fees, representations, and warranties, ensuring compliance with Malaysian banking regulations and international banking practices. It serves as an essential tool in various commercial contexts, from securing contract performance to supporting financial obligations.

1. Parties: Identifies and defines the parties to the agreement - typically the credit issuer (bank), the applicant, and the beneficiary

2. Background: Sets out the context and purpose of the standby credit arrangement

3. Definitions and Interpretation: Defines key terms used throughout the agreement and interpretation rules

4. Facility Terms: Details of the credit facility including amount, currency, and availability period

5. Conditions Precedent: Conditions that must be satisfied before the facility becomes available

6. Drawing and Payment Provisions: Procedures and requirements for drawing on the credit, including format of demand and supporting documents

7. Fees and Expenses: Details of all fees, charges, and expenses payable under the facility

8. Representations and Warranties: Standard representations and warranties given by the applicant

9. Undertakings: Positive and negative covenants of the applicant

10. Events of Default: Circumstances constituting default and consequences thereof

11. Payments and Calculations: Payment mechanics, calculation conventions, and currency provisions

12. Changes to Parties: Rules regarding assignment and transfer of rights and obligations

13. Notices: Communication procedures and contact details

14. General Provisions: Boilerplate clauses including severability, amendments, and governing law

15. Execution: Signature blocks and execution formalities