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Account Pledge Agreement
"I need an Account Pledge Agreement under Saudi law for a syndicated facility closing on March 15, 2025, where multiple USD and SAR accounts held by our manufacturing company will be pledged to a consortium of local and international banks, with HSBC acting as Security Agent."
1. Parties: Identification of the Pledgor (Account Holder), Pledgee (Security Beneficiary), and Account Bank
2. Background: Context of the pledge agreement, including reference to any underlying facility or main agreement
3. Definitions and Interpretation: Definitions of key terms and interpretation principles, including Sharia compliance declarations
4. Creation of Pledge: Express creation of the pledge over the account(s) and confirmation of Sharia-compliant security interest
5. Perfection Requirements: Steps required to perfect the pledge, including registration requirements under Saudi law
6. Pledgor's Obligations: Key obligations of the pledgor including maintenance of the account and restrictions on withdrawals
7. Representations and Warranties: Standard and specific representations regarding account ownership, capacity, and authority
8. Covenants: Ongoing obligations regarding account maintenance, notifications, and compliance with laws
9. Events of Default: Circumstances constituting default and triggering enforcement rights
10. Enforcement: Rights and procedures for enforcing the pledge in compliance with Saudi law and Sharia principles
11. Power of Attorney: Appointment of pledgee as attorney for enforcement purposes
12. Notices: Provisions for giving notices and communications between parties
13. Governing Law and Jurisdiction: Specification of Saudi law as governing law and Saudi courts' jurisdiction
1. Multiple Pledgors: Additional provisions required when multiple entities are granting the pledge
2. Currency Provisions: Specific provisions for accounts held in multiple currencies
3. Regulatory Compliance: Additional provisions required for compliance with specific SAMA regulations
4. Account Bank Provisions: Specific provisions when the Account Bank is a party to the agreement
5. Security Agent Provisions: Required when a security agent is appointed to hold the pledge on behalf of multiple beneficiaries
6. Further Assurance: Additional provisions for future actions that may be required for pledge effectiveness
7. Amendments and Waivers: Specific provisions regarding modification of the agreement
8. Severability: Provisions addressing the impact of invalid provisions
1. Schedule 1 - Pledged Account Details: Details of all accounts subject to the pledge, including account numbers and branches
2. Schedule 2 - Form of Notice to Account Bank: Template notice to be sent to the account bank regarding the pledge
3. Schedule 3 - Form of Account Bank Acknowledgment: Template acknowledgment to be signed by the account bank
4. Schedule 4 - Registration Forms: Forms required for registration of the pledge with relevant authorities
5. Schedule 5 - Existing Security Interests: List of any existing security interests over the accounts
6. Schedule 6 - Form of Power of Attorney: Template power of attorney for enforcement purposes
7. Appendix 1 - Regulatory Approvals: Copies of any required regulatory approvals or licenses
8. Appendix 2 - Corporate Authorizations: Copies of corporate approvals and authorizations
Authors
Banking
Financial Services
Islamic Finance
Corporate Finance
Investment Banking
Real Estate
Construction
Manufacturing
Energy
Infrastructure
Trading
Retail
Healthcare
Technology
Telecommunications
Legal
Finance
Treasury
Compliance
Risk Management
Corporate Banking
Islamic Banking
Credit
Security & Collateral
Documentation
Corporate Secretarial
Transaction Management
Chief Financial Officer
Treasury Manager
Legal Counsel
Compliance Officer
Finance Director
Corporate Lawyer
Banking Relationship Manager
Security Trustee
Credit Risk Manager
Transaction Manager
Islamic Finance Specialist
Corporate Secretary
Senior Finance Manager
Legal Director
Banking Officer
Security Agent
Documentation Manager
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