US Guarantee Limitations Clause Samples
The US Guarantee Limitations clause defines the specific boundaries and restrictions on the obligations that a US-based guarantor assumes under a contract. Typically, this clause clarifies that the guarantor’s liability is limited to certain amounts, types of obligations, or specific circumstances, and may exclude liabilities that would violate US law or public policy. By setting these parameters, the clause ensures that the guarantor is not exposed to unlimited or unintended risks, thereby protecting the guarantor from overreaching liability and ensuring compliance with applicable legal requirements.
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US Guarantee Limitations. Each Guarantor organised or incorporated under the laws of any state of the United States of America or the District of Columbia confirms that it is the intention of all such persons that the obligations of each Guarantor organised or incorporated under the laws of any state of the United States of America or the District of Columbia under this Clause 4 (Guarantees) do not constitute a fraudulent transfer or conveyance for the purposes of any proceeding of the type referred to in Condition 8(f) (Insolvency, etc.) or Condition 8(g) (Winding up, etc.) or Title 11, U.S. Bankruptcy Code, the United States Uniform Fraudulent Conveyance Act, the United States Uniform Fraudulent Transfer Act or any similar foreign or state law, to the extent applicable to the obligations of such Guarantor under this Clause 4 (Guarantees). To effect the foregoing intention, the Issuer, Trustee and each Guarantor hereby irrevocably agree that the obligations of each such Guarantor at any time shall be limited to the maximum amount as will result in the obligations of such Guarantor under this Clause 4 (Guarantees) not constituting a fraudulent transfer or conveyance.
US Guarantee Limitations. Notwithstanding anything to the contrary contained in this Clause 22, the maximum liability of any US Guarantor under this Clause 22 shall be 95% of the Net Assets of such US Guarantor. For such purpose, the term "Net Assets" of any such US Guarantor shall mean the highest amount, determined as of any Determination Date, by which (a) all of such US Guarantor's property at fair valuation (within the meaning of Section 101(32)(A) of the US Bankruptcy Code but excluding the capital stock or other ownership interests issued by any other Guarantor or by any other person that is required hereby to become a Guarantor) exceeds (b) such US Guarantor's debts (as defined in Section 101(12) of the US Bankruptcy Code but excluding its obligations under this Clause 22, and the term "
US Guarantee Limitations. Notwithstanding any term or provision of this Clause 18 or any other term in this Agreement or any other Finance Document, if at any time after the date of a Security Document, the relevant security provider or Guarantor under the Security Document notifies the Lender that the guarantee or a pledge of or security interest in the equity interests or other assets which are the subject of Transaction Security under a Security Document has a material adverse US tax implication on any member of the Group (including its ability to conduct its operations and business as otherwise not prohibited by the Finance Documents) under Section 956 of the Code as a result of any member of the Group entering into any transaction which is not prohibited under the terms of the Finance Document or as a result of any change in or re-enactment of (or in the interpretation, administration, implementation or application of) any law or regulation existing as at or after the date of this Agreement or the introduction of any new law or regulation occurring after the date of this Agreement, each Lender irrevocably and unconditionally agrees to enter into good faith discussions (acting reasonably) with the Obligors (or the Company on their behalf) with a view to agreeing to discharge any guarantees or release any Transaction Security under any Finance Documents and to enter into such documentation as is required by that security provider or the relevant Guarantor in order to effect such release or discharge to the extent necessary to eliminate such material adverse US tax implication in its entirety.
US Guarantee Limitations. (A) Notwithstanding any term of any Finance Document, no Loan to a US Borrower or other obligation of a US Obligor under this Agreement or under any Finance Document may be, directly or indirectly:
(i) guaranteed by a member of the Group (including, for this purpose, any direct or indirect subsidiaries acquired hereafter by the Company) that is a “controlled foreign corporation” (as defined in section 957(a) of the Code) that has a “United States shareholder” (as defined in section 951(b) of the Code) that is a member of the Group, and that is directly or indirectly owned (within the meaning of section 958(a) of the Code) by such United States shareholder (a “Specified CFC”) or by an entity (a “FSHCO”) substantially all the assets of which consist of equity interests (or equity interests and indebtedness) of one or more Specified CFCs or other FSHCOs, or guaranteed by a subsidiary of a Specified CFC or FSHCO;
(ii) secured by any assets of a Specified CFC, FSHCO or a subsidiary of a Specified CFC or a FSHCO (including any equity interests held directly or indirectly by a Specified CFC or FSHCO); or
(iii) secured by a pledge or other security interest in excess of 65% of the total combined voting power of all classes of shares entitled to vote (and in excess of 100% of the non-voting equity interests) of a Specified CFC or FSHCO.
(B) The limitations described in paragraph (A) above shall not apply if taking the actions described in subparagraphs (i) – (iii) above would not result in material US federal income taxes under Section 951(a)(1)(B) of the Code for a US member of the Group (as reasonably determined by the Borrower and the Lender in good faith after taking into account Treasury Regulations section 1.956-1(a)(2) and Section 245A and any related guidance).
US Guarantee Limitations. (a) Each US Guarantor acknowledges that it will receive valuable direct or indirect benefits as a result of the transactions financed by the Finance Documents.
(b) Each US Guarantor represents, warrants and agrees that:
(i) the aggregate amount of its debts and liabilities, subordinated, contingent or otherwise (including its obligations under the Finance Documents as limited by paragraph (c) below), is not greater than the aggregate value (being the lesser of fair valuation and present fair saleable value) of its assets;
(ii) its capital is not unreasonably small to carry on its business as it is being conducted;
(iii) it has not incurred and does not intend to incur debts beyond its ability to pay as they mature; and
(iv) it has not made a transfer or incurred any obligation under any Finance Document with the intent to hinder, delay or defraud any of its present or future creditors.
(c) Notwithstanding anything to the contrary contained herein or in any other Finance Document, the Lender agrees that the maximum liability of each US Guarantor under Clause 16 (Guarantee and indemnity) shall in no event exceed an amount equal to the greatest amount that would not render such US Guarantor’s obligations hereunder and under the other Finance Documents subject to avoidance under US Bankruptcy Law or to being set aside, avoided or annulled under any Fraudulent Transfer Law, in each case after giving effect (i) to all other liabilities of such US Guarantor, contingent or otherwise, that are relevant under such Fraudulent Transfer Law (specifically excluding, however, any liabilities of such US Guarantor in respect of intercompany indebtedness to any Borrower to the extent that such Financial Indebtedness would be discharged in an amount equal to the amount paid by such US Guarantor hereunder) and (ii) to the value as assets of such US Guarantor (as determined under the applicable provisions of such Fraudulent Transfer Law) of any rights to subrogation, contribution, reimbursement, indemnity or similar rights held by such US Guarantor pursuant to (A) applicable law, or (B) any other agreement providing for an equitable allocation among such US Guarantor and the Borrowers and other Guarantors of obligations arising under this Agreement or other guarantees of such obligations by such parties.
US Guarantee Limitations. (a) Notwithstanding any term or provision of this Clause 20 or any other term in this Agreement or any other Finance Document but without prejudice to the Original Security Documents and the Transaction Security or guarantee to be provided pursuant to Clause 24.27 (Conditions subsequent), no loan or other obligation under any Finance Document may be, directly or indirectly:
(i) guaranteed by a (a) “controlled foreign corporation” (as defined in Section 957(a) of the Code) (a CFC) or (b) Subsidiary (a FSHCO) substantially all of the assets of which consist of equity interests (and/or indebtedness) of one or more CFCs (including the indirect ownership of such equity interests or indebtedness through one or more FSHCOs) or (c) subsidiary of a CFC or a FSHCO;
(ii) secured by a pledge or other security interest in excess of 65 per cent. of the voting equity interests (and 100 per cent. of the non-voting equity interests) of a CFC or FSHCO;
(iii) secured by any assets of a CFC, FSHCO or a subsidiary of a CFC or FSHCO (including any CFC or FSHCO equity interests held directly or indirectly by a CFC or FSHCO); or
(iv) guaranteed by any subsidiary or secured by a pledge of or security interest in any subsidiary or other asset, if it would result in material adverse US tax consequences as reasonably determined by the Borrowers and the Obligor’s Agent and Agent, provided that in respect of any Original Security Documents, the Transaction Security and/or guarantee granted under paragraph (ii) of Clause 24.27 (Conditions subsequent) (each, a Relevant Transaction Security Documents and Guarantee), if at any time after the date of the Relevant Transaction Security Document and Guarantee, the relevant security provider or Guarantor under the Relevant Transaction Security Document and Guarantee notifies the Security Agent that the guarantee or a pledge of or security interest in the equity interests or other assets which are the subject of Transaction Security under a Relevant Transaction Security Document and Guarantee has a material adverse US tax implication on any member of the NFH Group (including its ability to conduct its operations and business as otherwise not prohibited by the Finance Documents) under Section 956 issued by the U.S. Department of the Treasury and the Internal Revenue Service (IRS) (Section 956) as a result of any Group Member’s or HHH Group Member’s entry into any transaction which is not prohibited under the terms of the Finance Document or as a ...
US Guarantee Limitations. Notwithstanding any other provision hereof, the obligations of each Guarantor shall be limited to an aggregate amount equal to the largest amount as will result in such obligations with respect hereto and thereto not constituting a fraudulent transfer or conveyance after giving full effect to the liability under such guarantee set forth in Clause 17.1 (Guarantee and indemnity) hereof and its related contribution rights but before taking into account any liabilities under any other guarantee by such Guarantor.
US Guarantee Limitations. The liability of each Guarantor organised under the laws of the United States of America (a "U.S. GUARANTOR") under this Clause 18 (Guarantees) shall not exceed the sum of:
(i) the net benefit realised by each such U.S. Guarantor from the proceeds of Drawings; and
(ii) the greater of (x) 95% of the Adjusted Net Assets of such U.S. Guarantor on the date of delivery hereof and (y) 95% of the Adjusted Net Assets of such U.S. Guarantor on the date of any payment hereunder. "ADJUSTED NET ASSETS" of any U.S. Guarantor at any date means the lesser of (x) the amount by which the fair value of the property of such U.S. Guarantor exceeds the total amount of liabilities (including, without limitation, contingent liabilities, but excluding liabilities under this Clause 18 (Guarantees), of such U.S. Guarantor at such date) and (y) the amount by which the present fair salable value of the assets of such U.S. Guarantor at such date exceeds the amount that will be required to pay the probable liability of such U.S. Guarantor on its debts, excluding debt in respect of this Clause 18 (Guarantees), as they become absolute and matured.
US Guarantee Limitations. (a) In this Clause, “fraudulent transfer law” means any applicable United States bankruptcy and State fraudulent transfer and conveyance statute and any related case law; and terms used in this Clause are to be construed in accordance with the fraudulent transfer laws.