Select a Form or Template from Thousands Curate Examples or Upload Your Own
Edit the Form to YOUR Specification with FormsPro.io
Send Document Securely for Signature and Store at FormsPro.io for Any Use!
A cross guarantee is an arrangement between two or more related firms to provide reciprocal guarantees for each other's liabilities, fulfillment of promises or obligations. This guarantee is agreed upon among related companies, such as groups of companies or a parent company and subsidiaries and affiliates.
The place where cross guarantees become cross border guarantees might invite scrutiny of regulators of different countries. Cross guarantees must be disclosed under contingent liability, along with lawsuits and warranties with the balance sheets. Sometimes implicit cross guarantee may be implied merely by the passive association of a firm with a firm of global or regional reputation, and a higher credit rating may result from this situation.
While drafting the guarantee agreement, it is customary to include a clause of indemnity to give additional advantage to the lender. In such cases, the courts may favor the lender by interpreting the agreement as an indemnity bond, which makes it unfavorable from the guarantor’s point of view. The capacity to give cross guarantee should be based on the article of association of the firms. If the directors are the beneficiaries of the guarantee, then the shareholders' approval may be required. The lender can enforce a guarantee even if the security of principal borrowers’ assets is held by him.
Questions? Contact us.
People searching for this document also often use these documents.
Memorandum Of Understanding
policies And Procedures
Best In Class Solution
Documents for all of your needs, whenever and whereever you need them.
Make as many versions and revisions as you need using our convenient tools.
Find documents covering a wide variety of industries and purposes.
Easily sign, save, print, and share documents, making short work of all your tasks.
Try us risk free! If you're not completely satisfied, we'll refund you.