Account Control Agreement Template for Malaysia

The Account Control Agreement is a crucial document in secured financing transactions under Malaysian law, typically used when a lender or security holder requires control over a borrower's bank accounts as collateral. This agreement creates a tripartite arrangement where the bank agrees to follow the secured party's instructions regarding the account under specific circumstances, usually following a default or enforcement event. The document includes detailed provisions on control mechanisms, operational procedures, and the rights and obligations of all parties, complying with Malaysian banking and security laws. It's commonly used in project finance, corporate lending, and structured finance transactions where account security is a key component of the collateral package. The agreement must align with Malaysian regulatory requirements, including those under the Financial Services Act 2013 and relevant Bank Negara Malaysia regulations.

1. Parties: Identifies the three main parties: Account Holder, Secured Party, and Account Bank

2. Background: Explains the context of the agreement, including reference to any underlying security agreement

3. Definitions and Interpretation: Defines key terms and establishes interpretation principles

4. Account Control and Security: Establishes the control arrangement and security interest over the account

5. Bank's Rights and Obligations: Details the bank's responsibilities, including following instructions and maintaining the account

6. Control and Instructions: Specifies who can give instructions and how the control mechanism works

7. Secured Party's Rights: Outlines the secured party's rights regarding the account and instructions

8. Account Holder's Rights and Restrictions: Defines what rights the account holder retains and applicable restrictions

9. Representations and Warranties: Contains standard representations and warranties from all parties

10. Fees and Expenses: Details fees payable to the bank and allocation of expenses

11. Notices: Specifies how formal notices must be given between parties

12. Termination: Sets out circumstances and process for terminating the agreement

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

14. General Provisions: Contains standard boilerplate provisions