The Performance Guarantee Agreement is a crucial financial security instrument in Malaysian business transactions, particularly in construction, infrastructure, and large commercial projects. It is utilized when one party (the beneficiary) requires security for the performance obligations of another party (the principal) under a primary contract. The agreement, governed by Malaysian law, establishes the guarantor's commitment to pay a specified sum upon valid demand if the principal fails to meet their contractual obligations. It must comply with both the Financial Services Act 2013 and, where applicable, the Islamic Financial Services Act 2013, reflecting Malaysia's dual banking system. The document includes specific provisions for demand mechanisms, expiry conditions, and claim procedures, providing clarity and certainty for all parties involved.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Your data doesn't train Genie's AI
You keep IP ownership of your docs
1. Parties: Identifies the Guarantor (typically a bank/financial institution), the Beneficiary, and the Principal (party whose performance is being guaranteed)
2. Background: Describes the underlying transaction/agreement and explains why the guarantee is being provided
3. Definitions and Interpretation: Defines key terms used in the agreement and sets out interpretation rules
4. Guarantee and Indemnity: Core section detailing the guarantee obligations, maximum liability amount, and indemnity provisions
5. Demand Requirements: Specifies the process and requirements for making a valid demand under the guarantee
6. Duration and Expiry: Sets out the guarantee period, expiry conditions, and any extension provisions
7. Payment Terms: Details the payment obligations, currency, timing, and method of payment
8. Representations and Warranties: Standard representations and warranties from the Guarantor
9. Bank's Rights and Obligations: Outlines the rights, protections, and obligations of the Guarantor bank
10. Governing Law and Jurisdiction: Specifies Malaysian law as governing law and sets out jurisdiction for disputes
11. Notices: Details how formal notices should be given between parties
12. General Provisions: Standard boilerplate clauses including severability, amendments, and counterparts
1. Islamic Banking Compliance: Required when the guarantee is being issued by an Islamic bank or needs to be Shariah-compliant
2. Assignment: Include if the guarantee rights may need to be assigned or transferred
3. Step-In Rights: Include for construction or project-related guarantees where the bank may need step-in rights
4. Counter Indemnity: Include if there is a separate counter-indemnity from the Principal to the Guarantor
5. Multiple Guarantors: Include if there are multiple guarantors to address joint and several liability
6. Foreign Currency Provisions: Required when the guarantee involves foreign currency payments
1. Form of Demand: Template for making a valid demand under the guarantee
2. Underlying Agreement Details: Key details of the agreement or obligation being guaranteed
3. Payment Details: Bank account and payment instruction details
4. Conditions Precedent: List of documents/conditions required before guarantee becomes effective
5. Authorized Signatories: List of persons authorized to make demands under the guarantee
6. Fees and Charges: Schedule of any applicable fees and charges
Find the exact document you need
Performance Guarantee Agreement
A Malaysian law-governed guarantee agreement where a financial institution guarantees the performance obligations of a principal party to a beneficiary.
Download
Payment And Performance Guarantee
A Malaysian law-governed security instrument that guarantees both payment obligations and performance requirements in commercial and construction contracts.
Download
Financial Guarantee And Performance Guarantee
A Malaysian law-governed guarantee document securing both financial obligations and performance obligations of a principal debtor/contractor to a beneficiary.
Download
Corporate Performance Guarantee
A Malaysian law-governed guarantee agreement where one company guarantees the performance obligations of another company to a beneficiary.
Download
Bid Bond Bank Guarantee
A Malaysian law-governed bank guarantee securing a bidder's obligation to honor their tender bid and proceed with the contract if selected.
Download
Performance Guarantee Bond
A Malaysian law-governed financial instrument where a guarantor undertakes to pay a specified sum to a beneficiary if a principal defaults on their contractual obligations.
Download
ұԾ’s Security Promise
Genie is the safest place to draft. Here’s how we prioritise your privacy and security.
Your documents are private:
We do not train on your data; ұԾ’s AI improves independently
All data stored on Genie is private to your organisation
Your documents are protected:
Your documents are protected by ultra-secure 256-bit encryption
We are ISO27001 certified, so your data is secure
Organizational security:
You retain IP ownership of your documents and their information
You have full control over your data and who gets to see it
.png)