Document background
The Guarantee Facility Agreement is a crucial document in secured lending transactions under Hong Kong law, typically used when a lender requires additional security beyond the borrower's own covenant. This agreement is essential in situations where a parent company guarantees a subsidiary's obligations, or where directors or related parties provide personal guarantees for corporate borrowing. The document establishes the terms under which the guarantor assumes responsibility for the borrower's obligations, including the scope of the guarantee, enforcement mechanisms, and the guarantor's rights and obligations. It must comply with Hong Kong's banking regulations, contract law, and specific requirements for guarantee arrangements, particularly those set out in the Banking Ordinance and related legislation.
