Certainty is the cardinal virtue of commercial and business transactions. That may be certainty over the payment of money or the performance of certain functions or services, but a party to a transaction wants assurance that its counter-party will perform according to their agreement. Commercial guarantees are an important instrument for enhancing the credit worthiness of a transaction and/or assuring performance. Guarantees are agreements by third parties to perform functions or pay money on the default of one of the signatories to an agreement. There are many types of guarantees, each with its own drafting nuances, depending on the type of transaction involved. This program will provide you with a practical guide to drafting guarantees in commercial and business transactions.
• Types of guarantees – absolute v. conditional, payment v. collection, performance, downstream v. upstream
• Essential role of consideration for guarantee
• Drafting joint and several liability provisions
• Release of co-guarantors
• Enhancing cost-effective enforcement and dispute resolution
• Defenses to enforcement of guaranties, including misrepresentation
Speaker: Steven O. Weise, Proskauer Rose, LLP, Los Angeles, CA
NOTE: This program was originally produced as a telephone seminar and is available on demand in streaming audio. This material qualifies for self-study credit only. Pursuant to Regulation 15.04.5, a lawyer may receive up to six hours of self-study credit in a reporting year. Self-study programs do not qualify for ethics or elimination of bias credit.