Contract of Guarantee to Lender relating to Loan Facility

The document titled 'Contract of Guarantee to Lender relating to Loan Facility' is a legal agreement entered into between the Guarantor and the Lender. The purpose of this document is to provide a guarantee for the obligations and liabilities of a loan granted to the Borrower by the Lender. The importance of this document lies in its ability to secure the repayment of the loan and protect the interests of the Lender.

 

The document begins with an introduction, stating the parties involved in the agreement, namely the Guarantor and the Lender. It also highlights the request made by the Guarantor to the Lender for the loan to be granted to the Borrower, and the agreement of the Lender to provide the credit facilities to the Borrower.

 

The document consists of several clauses and schedules, each serving a specific purpose. The interpretation clause defines the terms used throughout the guarantee, ensuring clarity and understanding. The consideration clause establishes the agreement between the Lender and the Guarantor, where the Guarantor agrees to provide a guarantee under this document.

 

The guarantee clause outlines the Guarantor's obligation to pay the debt when it becomes due and payable by the Borrower. It also states that the Guarantor's liability under this guarantee shall not exceed the aggregate of the principal sum of the loan and all interest, fees, commissions, charges, and expenses that have accrued under the agreement.

 

The limit of the Guarantor's liability is specified in a separate clause, stating that the guarantee is a guarantee of the full amount of the debt and expenses. However, the Guarantor will not be liable for any additional loan unless specifically approved or agreed upon in writing.

 

The document emphasizes the independence of this guarantee from any other security or guarantee held by the Lender. It states that the Lender has the right to choose which security to enforce and the order of enforcement. The Lender is not obliged to enforce any other security or take any other steps before enforcing this guarantee.

 

The document also addresses the rights and obligations of the Guarantor in case of bankruptcy or insolvency. It states that the Lender will be entitled to make a claim against the Borrower's assets for the full amount of the Borrower liability, even if the Guarantor has already made a partial payment.

 

The guarantee is a continuing guarantee, meaning that the Guarantor's obligations under this document are not affected by any changes or events, such as part payments, changes in the Borrower's name or constitution, or the Guarantor's death or insolvency.

 

The document includes provisions for the application of payments, the lender's actions or omissions, and the disclosure of information. It also addresses the lender's power to assign or transfer its rights and obligations under this guarantee.

 

The document concludes with general provisions, including the choice of law and jurisdiction, the waiver of objections to jurisdiction, and the confirmation of understanding and legal advice.

 

Each clause and schedule of the document serves a specific purpose, ensuring the clarity and enforceability of the guarantee. It is important for all parties involved to carefully read and understand the terms and conditions of this document before signing.

How to use this document?

1. Review the document: Read the entire document carefully to understand its purpose and the obligations of the Guarantor.

2. Understand the parties involved: Identify the Guarantor and the Lender mentioned in the document, along with their contact information.

3. Interpretation of terms: Familiarize yourself with the definitions provided in the interpretation clause to understand the meaning of key terms used throughout the guarantee.

4. Consideration: Understand the consideration clause, which establishes the agreement between the Lender and the Guarantor.

5. Guarantee obligations: Take note of the Guarantor's obligations, including the guarantee of debt repayment and the limit of liability.

6. Additional loans: Determine whether the Guarantor's approval is required for any additional loans and understand the implications of such approval.

7. Independence of guarantee: Understand that this guarantee is independent of any other security or guarantee held by the Lender.

8. Bankruptcy or insolvency: Be aware of the Lender's rights in case of the Borrower's bankruptcy or insolvency and the Guarantor's liability in such situations.

9. Continuing guarantee: Understand that the Guarantor's obligations under this guarantee continue until full payment of the Guarantor liability.

10. Application of payments: Note the order in which payments will be applied, including expenses, interest, charges, and principal amounts.

11. General provisions: Familiarize yourself with the general provisions, including the choice of law and jurisdiction.

12. Seek legal advice: It is recommended to consult with a legal professional to ensure a thorough understanding of the document and its implications before signing.