Guarantor Letter Clause Samples
A Guarantor Letter clause requires a third party, known as the guarantor, to formally commit to fulfilling certain obligations if the primary party fails to do so. Typically, this involves the guarantor providing a written assurance to cover debts, payments, or performance under a contract. For example, in a loan agreement, a guarantor letter may ensure that the lender can recover funds if the borrower defaults. The core function of this clause is to provide additional security and assurance to the beneficiary, reducing the risk of non-performance or non-payment.
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Guarantor Letter. The Proposal shall include: (a) an irrevocable letter signed by the guarantor committing to provide a guaranty in the form of Exhibit 13 of the Development Agreement (if a guaranty is required by TxDOT) and a guaranty in the form of Exhibit 9 of the CMA, concurrently with execution and delivery of the Development Agreement Documents and CMA Documents by Proposer, (b) evidence of authorization of the signatory to that letter, (c) Form B-1 for the guarantor, (d) financial information described in Section 2.0 of Exhibit C-1; and (e) such other information concerning the guarantor as TxDOT may request. A guaranty of Developer’s obligation under the Development Agreement is required under the following circumstances: (i) Proposer identified a guarantor in its QS or was advised by TxDOT that a guaranty would be required as a condition to the shortlisting of Proposer, (ii) Proposer’s organization is a newly formed corporation or a limited liability entity, (iii) the combined Tangible Net Worth of Proposer and its equity members is less than $200,000,000; or (iv) the form of organization of Proposer and/or the financially responsible parties comprising Proposer changes and TxDOT determines, in its sole discretion, to require a guarantor as a condition to approving such change under ITP Section 2.11. If a guaranty is required, the combined Tangible Net Worth of the guarantor, Proposer and its Equity Members must be at least $200,000.000. Tangible Net Worth shall be determined based on audited financial statements for the fiscal year most recently ended. A guaranty of Maintenance Contractor’s obligations under the CMA is required from all Equity Members of the Proposer.
Guarantor Letter. The Proposal shall include (if a guaranty is required): (a) an irrevocable letter signed by the guarantor in the form of Form T committing to provide a guaranty in the form of Exhibit 13 of the DBA and a guaranty in the form of Exhibit 9 of the CMA (as applicable), concurrently with execution and delivery of the DBA Documents and CMA Documents by Proposer; (b) evidence of authorization of the signatory to that letter;