tiktok³ÉÈË°æ

The Guarantor Indemnity Agreement is essential in commercial transactions where additional security is required for financial obligations. Commonly used in lending arrangements, corporate group structures, and commercial leases across Canada, this document provides creditors with comprehensive protection by combining both guarantee and indemnity obligations. It is particularly relevant when a parent company guarantees a subsidiary's obligations, in real estate transactions, or in commercial lending scenarios. The agreement must comply with Canadian federal and provincial requirements, including the Statute of Frauds' writing requirements and provincial security registration requirements. It typically includes detailed provisions about the scope of guaranteed obligations, enforcement mechanisms, and the guarantor's rights and obligations.

1. Parties: Identifies the Guarantor, the Principal Debtor, and the Beneficiary (creditor)

2. Background: Explains the context of the guarantee, including reference to the principal agreement or facility being guaranteed

3. Definitions and Interpretation: Defines key terms and establishes interpretation rules for the agreement

4. Guarantee and Indemnity: Core section establishing the guarantee and indemnity obligations

5. Scope of Guarantee: Defines exactly what obligations are covered by the guarantee

6. Nature of Liability: Establishes whether the liability is joint, several, or joint and several, and whether it's immediate or continuing

7. Preservation of Rights: Protects the beneficiary's rights in various scenarios such as invalidity of principal debt or variations

8. Representations and Warranties: Guarantor's confirmations about their capacity and authority to enter into the agreement

9. Payment Provisions: Details how and when payments must be made, including provisions for tax gross-up if applicable

10. Default and Enforcement: Specifies what constitutes default and the beneficiary's enforcement rights

11. Costs and Expenses: Allocates responsibility for costs related to the agreement and its enforcement

12. Notices: Specifies how formal communications between parties should be made

13. Governing Law and Jurisdiction: Specifies the applicable law and courts having jurisdiction

14. Execution: Signature blocks and execution formalities