GUARANTY AGREEMENT
This guaranty agreement (hereafter referred to as “Guaranty”), dated , has been entered into between __________________________, a company duly incorporated under the laws of ___________________________, having its head office at _________________________________ (hereafter referred to as the “Guarantor”) and HYDRO-QUÉBEC, acting through its division Hydro-Québec TransÉnergie, a corporation duly incorporated under and governed by the Hydro-Québec Act (R.S.Q., Chapter H-5) having its head office at 75 René-Lévesque Blvd West, Montreal, Quebec, Canada H2Z 1A4 (hereafter referred to as the “Beneficiary”).
WHEREAS the Beneficiary and __________________________, a company duly incorporated under the laws of _______________________, having its head office at ____________________________ (hereafter referred to as the “Customer”), are parties to certain transmission agreements (collectively, whether one or more, the “Contract”);
WHEREAS the Guarantor shall benefit directly or indirectly from the Contract;
WHEREAS the Beneficiary has required that the Guarantor unconditionally guarantee to the Beneficiary all the Customer’s obligations under the Contract;
THEREFORE, in view of the foregoing, the Guarantor and the Beneficiary agree as follows:
1. Guaranty. The Guarantor absolutely, irrevocably and unconditionally guarantees to the Beneficiary all the obligations of the Customer under the Contract including the prompt payment when due of all the amounts owed by the Customer to the Beneficiary arising from the obligations pursuant to the Contract, even if such obligations and such amounts are not yet liquidated or payable (hereafter referred to as the “Obligations”), on the understanding that the Guarantor’s liability under this Guaranty shall be limited to an amount of $________________ plus all reasonable costs incurred by the Beneficiary in asserting its rights against the Guarantor under this Guaranty, including any legal fees, judicial costs and similar costs.
The Guarantor shall pay any amounts guaranteed by this Guaranty as soon as the Beneficiary makes a request for payment to the Guarantor. The fact that the Beneficiary makes a request for payment shall not in any way restrict its right to subsequently make any other request for payment.
2. Solidary liability. The Guarantor shall assume solidary liability with the Customer with respect to the Obligations and shall waive the benefit of discussion and division, as well as any notice of exercise by the Beneficiary of any right or security.
3. Scope of Guaranty. This Guaranty shall be valid even if the Customer did not have legal personality or capacity at the time the Contract was signed. Moreover, the Guarantor waives the right to invoke any defence that the Customer or the Guarantor could assert against the Beneficiary, any cause of reduction, extinguishment or nullity of the Obligations, and any excess or absence of authority on the part of persons who acted in the Customer’s name in assuming Obligations on its behalf.
4. Consents, waivers and renewals. The Beneficiary may at any time, without the Guarantor’s consent and without notice to the Guarantor, extend the deadline for the payment of the Obligations, refrain from realizing or waive any security provided in regard to the Obligations, or amend or renew the Contract, and it may also enter into any agreement with the Customer or with any person responsible for the Obligations regarding the amendment, extension, renewal, payment or extinguishment of the Obligations, without affecting or diminishing the liability of the Guarantor in any manner whatsoever.
5. Change of circumstances. This Guaranty shall subsist notwithstanding any change in the circumstances that gave rise to the granting of this Guaranty by the Guarantor, notwithstanding the cessation of the Guarantor’s commercial operations or any change in the said operations or in the relationship between the Guarantor and the Customer. The Guarantor shall continue to be liable for the Customer’s Obligations even if the Customer is released therefrom as a result of a bankruptcy, a proposal, an arrangement or for any other reason.
6. Subrogation. The Guarantor shall not exercise any right against the Customer which it may acquire through subrogation as long as the amounts owed to the Beneficiary under the Contract have not been paid in full. Subject to the foregoing, upon payment of all the Obligations, the Guarantor shall be subrogated in the Beneficiary’s rights against the Customer.
7. Cumulative rights. Failure or delay on the part of the Beneficiary to exercise any right, recourse or power granted herein shall not prevent subsequent exercise of any right, recourse or power. Each and every right, recourse and power granted herein to the Beneficiary or which the latter is entitled to exercise under the law or by virtue of any other contract is cumulative and non-exclusive and may be exercised by the Beneficiary from time to time.
8. Representations and warranties.
The Guarantor makes the following representations and warranties:
a) It is duly constituted, validly subsisting and in good standing pursuant to the laws of the jurisdiction where it was constituted and it has all the powers required to sign and deliver this Guaranty and to perform the Obligations thereunder.
b) The signature and delivery of this Guaranty and the performance of the Obligations thereunder were and are duly authorized by all the measures required on the part of the Guarantor and do not contravene any statutory provision or any constituting documents of the Guarantor or any contractual binding the Guarantor or applicable to its assets.
9. Termination. This Guaranty shall continue in full force and effect during the term of the Agreement and until complete performance by Customer of its Obligations under the Agreement. However, the Guarantor may terminate this Guaranty with respect to future obligations of Customer by providing written notice of termination to the Beneficiary. The Guarantor's notice of termination will become effective thirty (30) days after its receipt by the Beneficiary. Termination of this Guaranty will not affect the Guarantor's liability to the Beneficiary hereunder for the Obligations of Customer incurred prior to the effective date of termination.
10. Assignment. None of the parties may assign any of their rights, interests or obligations pursuant to this Guaranty to any third party without the prior consent in writing of the other party.
In the event of an assignment of part or all of the obligations pursuant to the Contract by the Customer, this Guaranty shall continue to extend to all the Obligations and the term “Customer” shall be deemed to include the assignee for purposes of interpreting this Guaranty.
11. Notices. All notices and other communications pertaining to this Guaranty shall be given in writing and delivered by hand or sent by registered mail (with request for a receipt) or by fax (except in the case of a request for payment) and shall be sent to one of the following addresses:
If being sent to the Guarantor: If being sent to the Beneficiary:
__________________________ HYDRO-QUÉBEC TRANSÉNERGIE
__________________________ c/o
__________________________ Directeur Commercialisation et affaires __________________________ réglementaires
__________________________ Complexe Desjardins, C.P. 10 000
__________________________ Tour de l’Est, 19e étage
__________________________ Montréal (Québec) Canada
__________________________ H5B 1H7
__________________________ Phone : (514) 879-4159
__________________________ Fax: (514) 879-4685
or to any address which the Guarantor or the Beneficiary may notify to the other party from time to time.
Any notice or other communication related to this Guaranty shall be deemed to have been received when delivered, if delivered by hand, on the business day following its transmission if sent by fax, or on the third business day after it was sent by registered mail, as the case may be.
12. Notice of breach. When a notice of breach regarding the Contract is sent to the Customer, the Beneficiary shall also send a copy of said notice to the Guarantor.
13. Other suretyships. This Guaranty is in addition to not in substitution for any other guarantee or suretyships that the Beneficiary may hold.
14. Amendments. A written amendment executed by Guarantor only may increase the amount of this Guaranty provided in section 1. Unless otherwise provided herein, no other amendment of this Guaranty shall be effective unless in writing and signed by Guarantor and Counterparty. No waiver of any provision of this Guaranty nor consent to any departure by Guarantor therefrom shall in any event be effective unless such waiver shall be in writing and signed by Counterparty. Any such waiver shall be effective only in the specific instance and for the specific purpose for which it was given.
15. Entire agreement. This Guaranty constitutes the entire agreement entered into by the Guarantor and Beneficiary with regard to the matters contemplated herein. It does not replace, unless otherwise expressly provided, any previous guaranty granted by the Guarantor to the Beneficiary.
16. Applicable laws and competent jurisdiction. This Guaranty is governed by the laws in force in the province of Québec and shall be interpreted accordingly. Any legal action related thereto shall be instituted in the judicial district of Montréal and the Guarantor acknowledges the exclusive jurisdiction of the courts sitting in the said district.
IN WITNESS WHEREOF, the Guarantor has signed this Guaranty on the date mentioned above.
(NAME OF GUARANTOR)
By: ________________________________________
Name: ______________________________________
Title: _______________________________________
January 2013
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