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Intercompany Promissory Note for Malaysia

Intercompany Promissory Note Template for Malaysia

A formal financial instrument governed by Malaysian law that documents a promise by one company to pay a specified sum to another company within the same corporate group. The document complies with the Bills of Exchange Act 1949 and includes essential terms such as the principal amount, interest rate, payment schedule, and maturity date. It creates a legally binding obligation between the group companies while adhering to Malaysian corporate and financial regulations, including necessary stamping requirements under the Stamp Act 1949.

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Intercompany Promissory Note

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What is a Intercompany Promissory Note?

The Intercompany Promissory Note is a crucial instrument in Malaysian corporate finance, used to formalize and document internal lending arrangements between affiliated companies. It serves as evidence of indebtedness and sets out the terms of repayment, including interest rates and payment schedules. This document type is particularly important for corporate groups managing internal capital allocation, tax planning, and regulatory compliance. The note must comply with Malaysian legislation, particularly the Bills of Exchange Act 1949 and Companies Act 2016, and requires proper stamping to be admissible in court. It's commonly used for intercompany loans, capital restructuring, and internal financing arrangements.

What sections should be included in a Intercompany Promissory Note?

1. Parties: Identification of the maker (promissor) and payee (promissee) companies, including their full legal names, registration numbers, and registered addresses

2. Background: Brief context of the intercompany relationship and purpose of the promissory note

3. Definitions: Key terms used in the document, including Business Day, Interest Rate, Maturity Date, and other relevant financial terms

4. Promise to Pay: Unconditional promise to pay the principal sum, specifying the amount, currency, and payment date

5. Interest: Interest rate, calculation method, and payment frequency

6. Payment Terms: Details of how and where payments will be made, including bank account details and payment mechanics

7. Events of Default: Circumstances that trigger immediate repayment obligation

8. Governing Law and Jurisdiction: Specification of Malaysian law as governing law and jurisdiction for disputes

What sections are optional to include in a Intercompany Promissory Note?

1. Security: Include when the note is secured by specific assets or guarantees

2. Prepayment Terms: Include when early repayment is permitted, specifying any conditions or penalties

3. Tax Provisions: Include when specific tax treatments or withholding requirements need to be addressed

4. Transferability: Include when the note needs to be transferable or specifically non-transferable

5. Subordination: Include when the note needs to be subordinated to other debts

6. Cross-Default: Include when default under other specified agreements should trigger default under this note

What schedules should be included in a Intercompany Promissory Note?

1. Payment Schedule: If payments are to be made in installments, detailed schedule of payment dates and amounts

2. Security Details: If applicable, detailed description of any security or collateral provided

3. Calculation of Interest: If complex interest calculations apply, detailed methodology and examples

4. Form of Notice: Standard form for any notices required under the note

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Malaysia

Document Type

Promissory Note

Sector

Banking

Cost

Free to use
Relevant legal definitions
















Clauses




















Relevant Industries

Financial Services

Manufacturing

Technology

Retail

Energy

Healthcare

Real Estate

Mining

Telecommunications

Construction

Hospitality

Relevant Teams

Legal

Finance

Treasury

Tax

Compliance

Corporate Secretarial

Accounting

Corporate Finance

Relevant Roles

Chief Financial Officer

Finance Director

Treasury Manager

Financial Controller

Legal Counsel

Company Secretary

Tax Manager

Accounting Manager

Group Finance Manager

Corporate Finance Manager

Finance Operations Manager

Compliance 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, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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