The Guarantee Contract is a crucial instrument in Swiss commercial practice, commonly used to secure financial obligations, construction projects, and commercial transactions. Under Swiss law, guarantees must comply with strict formal requirements set out in the Swiss Code of Obligations, including written form and maximum amount specification. This document is particularly relevant when a third party needs to provide security for another party's obligations, whether in a corporate group structure, project finance, or general commercial context. The guarantee can be structured either as a dependent guarantee (B眉rgschaft) or an independent guarantee (Garantie), with the choice affecting the guarantor's defenses and the conditions for payment. The document typically includes detailed provisions on demand mechanics, representations, and enforcement procedures, all tailored to comply with Swiss legal requirements and commercial practice.
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1. Parties: Identification of the Guarantor, the Beneficiary (Creditor), and reference to the Principal Debtor
2. Background: Context of the guarantee, reference to the underlying obligation being guaranteed
3. Definitions: Key terms used in the guarantee, including 'Guaranteed Obligations', 'Maximum Liability Amount', and 'Guarantee Period'
4. Guarantee: Core guarantee obligation, explicitly stating the maximum amount as required by Swiss law
5. Scope of Guarantee: Detailed description of the obligations covered by the guarantee
6. Independence and Primary Nature: Clarification whether this is an independent guarantee (Garantie) or a dependent guarantee (B眉rgschaft)
7. Demands and Payments: Process and requirements for making demands under the guarantee
8. Duration and Release: Term of the guarantee and conditions for release of the guarantor
9. Representations and Warranties: Guarantor's confirmations regarding capacity and authority
10. Governing Law and Jurisdiction: Confirmation of Swiss law governance and jurisdiction
1. Transfer and Assignment: Include if guarantee rights may be transferred or if assignment should be restricted
2. Counter-Indemnity: Include if the guarantor requires indemnification from the principal debtor
3. Multiple Guarantors: Include if there are multiple guarantors to address joint and several liability
4. Currency Provisions: Include if the guarantee involves foreign currency obligations
5. Tax Gross-Up: Include if payments under the guarantee may be subject to withholding tax
6. Communications: Include if specific notice requirements for demands or communications are needed
1. Form of Demand: Template for making valid demands under the guarantee
2. Underlying Obligation: Copy or summary of the principal obligation being guaranteed
3. Guarantor Board Resolution: Evidence of corporate authority for corporate guarantors
4. Payment Details: Bank account and payment information for guarantee payments
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