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The Personal Guarantee Agreement is a critical legal instrument used in New Zealand business and financial transactions when additional security is required for a loan, credit facility, or other financial obligation. This document is commonly used when a company seeks financing but the lender requires personal assurance from directors, shareholders, or related parties. The agreement, governed by New Zealand law, establishes the guarantor's obligations, limits of liability, enforcement mechanisms, and includes necessary consumer protections. It's particularly vital for small-to-medium enterprises where lenders often require personal guarantees from company directors or shareholders. The document must comply with New Zealand's Contract and Commercial Law Act 2017, Credit Contracts and Consumer Finance Act 2003, and other relevant legislation.

1. Parties: Identifies and defines all parties: the Creditor, the Principal Debtor, and the Guarantor(s)

2. Background: Explains the context of the guarantee, including the underlying debt or obligation being guaranteed

3. Definitions and Interpretation: Defines key terms used throughout the agreement and establishes interpretation rules

4. Guarantee and Indemnity: Core section detailing the guarantee obligations, including the scope and nature of the guarantee

5. Extent of Guarantee: Specifies the maximum liability amount and whether the guarantee is limited or unlimited

6. Nature of Guarantee: Establishes whether the guarantee is continuing, irrevocable, and/or joint and several

7. Guarantor's Obligations: Details specific obligations, payments, and actions required of the guarantor

8. Creditor's Rights: Outlines the rights of the creditor, including enforcement and recovery rights

9. Payments: Specifies payment terms, methods, and conditions

10. Representations and Warranties: States the guarantor's confirmations about their capacity and understanding

11. Default and Enforcement: Describes what constitutes default and the consequences thereof

12. Costs and Indemnity: Addresses liability for costs and indemnification obligations

13. General Provisions: Contains standard contractual provisions like notices, amendments, and governing law

14. Execution: Signature blocks and execution requirements for all parties