The Share Mortgage Agreement is a crucial security document used in Malaysian financial transactions where shares are provided as collateral for loans or other financial obligations. It is commonly used in corporate financing, acquisition financing, and general banking facilities. The agreement must comply with Malaysian legal requirements, particularly the Companies Act 2016 and relevant securities regulations. The document typically includes detailed provisions on the creation and perfection of the security interest, rights and obligations of parties, enforcement mechanisms, and treatment of dividends and voting rights. For listed shares, additional provisions addressing central depository requirements are incorporated. The agreement is essential for both financial institutions seeking security and businesses using their shareholdings to secure financing.

1. Parties: Identification of the Mortgagor (share owner) and Mortgagee (lender), including registration numbers and registered addresses

2. Background: Recitals explaining the context of the share mortgage, including details of the underlying facility/loan agreement

3. Definitions and Interpretation: Definitions of key terms and interpretation clauses, including rules for construction of the agreement

4. Grant of Security: Core provision creating the mortgage over the shares, specifically describing the mortgaged shares and the secured obligations

5. Representations and Warranties: Mortgagor's warranties regarding ownership, authority, and status of shares

6. Covenants: Positive and negative obligations of the Mortgagor regarding the mortgaged shares

7. Rights and Obligations: Details of parties' rights including voting rights, dividends, and other corporate actions

8. Events of Default: Circumstances constituting default and triggering enforcement rights

9. Enforcement: Mortgagee's rights and procedures upon default, including power of sale

10. Further Assurance: Obligation to execute additional documents and take necessary steps to perfect security

11. Notices: Process and requirements for giving notices under the agreement

12. Assignment and Transfer: Provisions regarding transfer of rights under the mortgage

13. General Provisions: Standard boilerplate clauses including governing law, jurisdiction, and severability