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Parental Guarantee to other parties in relation to Shareholders Agreement

Guaranteed Shareholders

In relation to a Joint Venture / Shareholders Agreement, a guarantee is given by a party's parent to the other shareholders for the party's obligations. This is drafted in favour of the Guaranteed Shareholders.

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01

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02

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04

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The document should be signed by the authorised signatory (or directors of a company) and witnessed to complete the formality.

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Document Description

In relation to a Joint Venture / Shareholders Agreement, a guarantee is given by a party's parent to the other shareholders for the party's obligations. This is drafted in favour of the Guaranteed Shareholders.

If and each time that the Party fails for any reason whatsoever to perform or observe any of the obligations, commitments or undertakings referred to in clause 2, the Guarantor shall forthwith upon demand unconditionally perform (or procure the performance or observance of) and satisfy (or procure the satisfaction of) the obligation, commitment or undertaking in respect of which such failure has occurred in the manner prescribed in the Agreement and so that the same benefits shall be received by, or conferred on, the Company and/or the Other Shareholders as it or they would have had if such obligation, commitment or undertaking had been duly performed, observed and satisfied by the Party.

The Guarantor's liability under this Guarantee shall remain in force notwithstanding any act, omission, neglect, event or matter whatsoever (whether or not known to the Party, the Company, the Other Shareholders or the Guarantor). Nothing shall impair or discharge the Guarantor's liability or obligations under this Guarantee.

How to use this Document?

This guarantee should be carefully read by the shareholders and guarantor involved.

This guarantee may be used when the parties enter into a shareholders agreement with the parent of one shareholder guaranteeing the obligations to the other shareholders upon the establishment of a Joint Venture Company. 

The guarantor should sign and return a copy, and once signed, all parties should get a copy.

To avoid any future disputes, the guarantor should have its signature witnessed. This guarantee cannot be revoked by the guarantor.

 

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