Editor`s note. A guarantee (sometimes called a „guarantee“) is a legally binding obligation of a party called guarantor to pay or honour the obligations of another company, usually a related company of the surety, if that other entity does not. This agreement is a guarantee of payment if a party to a commercial contract cannot make a timely payment due in a corresponding agreement. CONSIDERING that the surety has established that it will benefit from the debtor`s conclusion of the agreement and therefore wants this guarantee agreement (this „guarantee“) to be concluded taking into account the conclusion of the agreement by the beneficiary; Comment: This „merger clause“ is intended to demonstrate that the written agreement is the final and complete agreement of the parties and that it must be understood. Comment: Considerations that may begin with the more formal „WHEREAS“ but should not begin with the more formal „WHEREAS“ define the context of an agreement. Since an important element of a guarantee is to take into account the commitments made by the surety, the recitals are useful in determining the purpose of the guarantee and the relationship between the debtor under the basic agreement and the guarantee. If the surety is linked to a debtor`s parent company as part of the agreement or in any way, it must indicate it. Comment: The waiver of these requirements ensures that the surety is not released accidentally, for example by not receiving notification of non-payment from the debtor. Such an exemption allows the beneficiary to act immediately against the guarantor. Comment: This section outlines the obligations of the bond, including the nature of the guarantee. This agreement contains a guarantee of payment, i.e. if the debtor does not pay, the beneficiary can act directly against the bond without the beneficiary having initiated the first proceedings against the debtor. A payment guarantee differs from a collection guarantee in this respect.
As part of a recovery guarantee, the beneficiary must first exhaust his claims against the debtor before he wants to assert his rights against the guarantor. A performance guarantee requires the guarantor to keep the promise that the debtor made but did not keep. The commitment may involve a payment obligation or other obligation (for example. B for the provision of goods or services). Comment: Some guarantees provide specific communication to guarantors as soon as the primary index has not paid or executed. Other guarantees provide that the surety must pay or fulfill its obligations if the principal debtor does not do so without the need for further notification.
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