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Guarantee Facility Agreement for the Netherlands

Guarantee Facility Agreement Template for Netherlands

A Dutch law-governed Guarantee Facility Agreement is a comprehensive legal document that establishes a framework under which a financial institution agrees to issue guarantees on behalf of a company up to an agreed facility limit. The agreement details the terms and conditions for issuing individual guarantees, including fees, reimbursement obligations, and security arrangements. It incorporates specific Dutch legal requirements, particularly those from the Dutch Civil Code (Burgerlijk Wetboek) regarding suretyship and guarantees, while establishing the operational mechanics for guarantee issuance, monitoring, and eventual discharge.

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Guarantee Facility Agreement

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What is a Guarantee Facility Agreement?

The Guarantee Facility Agreement is essential for businesses requiring regular issuance of bank guarantees or similar instruments to support their commercial operations. This document, governed by Dutch law, creates a framework under which a financial institution can efficiently issue multiple guarantees without negotiating terms for each individual guarantee. The agreement comprehensively addresses facility limits, issuance procedures, fees, reimbursement obligations, and security arrangements. It is particularly useful for companies engaged in construction, international trade, or other sectors requiring performance bonds, tender guarantees, or advance payment guarantees. The document incorporates specific Dutch legal requirements and banking practices, making it suitable for use in the Netherlands while potentially accommodating international business needs.

What sections should be included in a Guarantee Facility Agreement?

1. Parties: Identification of the guarantee facility provider, the applicant/obligor, and any other key parties

2. Background: Context of the facility, relationship between parties, and purpose of the guarantee facility

3. Definitions and Interpretation: Defined terms, interpretation rules, and currency conventions

4. The Facility: Core terms of the guarantee facility including facility limit, purpose, and availability period

5. Conditions Precedent: Documents and conditions required before the facility becomes available

6. Issuance of Guarantees: Process and requirements for requesting and issuing individual guarantees under the facility

7. Fees and Costs: Guarantee commission, issuance fees, and other costs

8. Payment and Reimbursement: Terms for reimbursement of amounts paid under guarantees and payment mechanics

9. Representations and Warranties: Standard and specific representations made by the applicant

10. Undertakings: General and specific covenants of the applicant

11. Events of Default: Circumstances constituting default and consequences

12. Changes to Parties: Transfer and assignment provisions

13. Administration: Operational aspects including notices and calculations

14. Governing Law and Jurisdiction: Choice of Dutch law and jurisdiction provisions

What sections are optional to include in a Guarantee Facility Agreement?

1. Security: Required if specific security is being provided for the facility obligations

2. Multiple Guarantors: Required if there are multiple entities providing guarantees or counter-indemnities

3. Currency Provisions: Required for multi-currency facilities

4. Tax Gross-up and Indemnities: Detailed tax provisions if cross-border elements exist

5. Bank Accounts: Required if specific account arrangements are needed for the facility

6. Guarantee Limits and Restrictions: Required if there are specific regulatory or internal policy limits

7. Counter-Indemnities: Required if third-party counter-indemnities are part of the structure

8. Parallel Debt: Required under Dutch law if security is granted to a security agent

What schedules should be included in a Guarantee Facility Agreement?

1. Form of Guarantee Issuance Request: Standard form for requesting issuance of guarantees under the facility

2. Form of Guarantee: Template(s) for guarantees to be issued under the facility

3. Conditions Precedent Documents: Detailed list of required conditions precedent documents

4. Fee Schedule: Detailed breakdown of all applicable fees and charges

5. Acceptable Guarantee Forms: List and templates of permitted guarantee types

6. Notice Details: Contact details and notice requirements for all parties

7. Processing Requirements: Operational procedures and requirements for guarantee issuance

8. Existing Guarantees: If applicable, list of existing guarantees to be brought under the facility

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Netherlands

Document Type

Financing Agreement

Cost

Free to use
Relevant legal definitions























































Clauses



























Relevant Industries

Banking and Financial Services

Construction and Infrastructure

International Trade

Manufacturing

Energy and Utilities

Shipping and Maritime

Real Estate and Property Development

Engineering and Construction

Oil and Gas

Government and Public Sector

Telecommunications

Relevant Teams

Legal

Finance

Treasury

Risk Management

Commercial

Credit

Trade Finance

Corporate Banking

Compliance

Operations

Relevant Roles

Chief Financial Officer

Treasury Manager

Finance Director

Legal Counsel

Corporate Lawyer

Banking Relationship Manager

Credit Risk Manager

Facility Manager

Contract Manager

Company Secretary

Financial Controller

Trade Finance Manager

Risk Manager

Commercial Director

Business Development Manager

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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