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Guaranty Form
"I need a Guaranty Form for my Saudi construction company to guarantee payment obligations of our subsidiary for a new development project, with a maximum guarantee amount of 5 million SAR and an expiry date of March 15, 2025."
1. Parties: Identification of the Guarantor, Beneficiary (Creditor), and Principal Debtor
2. Background: Context of the guarantee, reference to the underlying obligation, and relationship between parties
3. Definitions: Key terms used throughout the guarantee, including 'Guaranteed Obligations', 'Security', and 'Event of Default'
4. Guarantee and Indemnity: Core guarantee provisions, scope of guaranteed obligations, and nature of guarantor's liability
5. Sharia Compliance Declaration: Express confirmation that the guarantee arrangement complies with Sharia principles
6. Representations and Warranties: Guarantor's confirmations regarding capacity, authority, and ability to perform obligations
7. Payment Provisions: Terms for making payments under the guarantee, including currency and method
8. Duration and Release: Term of the guarantee and conditions for release of guarantor's obligations
9. Communications: Methods and addresses for notices and other communications
10. Governing Law and Jurisdiction: Confirmation of Saudi law application and jurisdiction of Saudi courts
1. Security Provisions: Include when the guarantee is secured by specific assets or collateral
2. Multiple Guarantors: Additional provisions required when there is more than one guarantor
3. Counter-Indemnity: Terms for guarantor's right of recourse against the principal debtor
4. Assignment and Transfer: Include if parties want to allow transfer of guarantee rights
5. Currency Provisions: Required for cross-border transactions involving multiple currencies
6. Costs and Expenses: Detailed provisions about who bears the costs of enforcement and maintenance
7. Limited Recourse: Include when guarantor's liability is to be limited to specific assets
1. Schedule 1 - Guaranteed Obligations: Detailed description of the underlying obligations being guaranteed
2. Schedule 2 - Form of Demand: Template for making a formal demand under the guarantee
3. Schedule 3 - Security Assets: List and description of any assets securing the guarantee obligations
4. Appendix A - Required Documents: List of documents required for guarantee activation and claims
5. Appendix B - Authorized Signatories: List of persons authorized to make demands under the guarantee
Authors
Banking & Financial Services
Construction & Infrastructure
Real Estate
Manufacturing
Trading & Commerce
Oil & Gas
Transportation & Logistics
Healthcare
Retail
Telecommunications
Legal
Finance
Risk Management
Compliance
Treasury
Commercial
Credit
Corporate Governance
Business Development
Islamic Banking
Legal Counsel
Corporate Lawyer
Finance Manager
Risk Manager
Commercial Director
Compliance Officer
Credit Manager
Treasury Manager
Contract Administrator
Chief Financial Officer
Managing Director
Islamic Finance Specialist
Business Development Manager
Company Secretary
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