This Deed of Agreement of guarantee executed at .................................................................on
this ......................................... day of.................. 20................by........................................................ s/o w/o d/o ............................................................................ hereinafter called the "Guarantor(s)" which term shall mean and include their heirs, legal representatives, executors, administrators and assigns, in favour of Tamil Nadu Grama Bank constituted under Regional Rural Banks Act, 1976, having its Head Office at Salem - 636 007, hereinafter called the "Bank", which term shall mean and include its successors and assigns.
1. In consideration of the Bank allowing/continuing/enhancing at the request of the Guarantor(s),
the following banking facilities
No. Type of Facility Limit `.
i.
ii.
iii.
to............................................................................................................................................................ ...... (name of the borrower) at its ..................................................................................... Branch on the terms and conditions contained in loan documents dated .......................................................the guarantor(s) hereby agree/s with the Bank as under.
2. The Guarantor(s) hereby guarantee/s jointly and severally to pay the bank on demand all principal, interest, costs, charges and expenses due and which may at any time become due to the Bank from the Borrower on the accounts opened in respect of the said facility (hereinafter called the 'said accounts') down to the date of payment and also all loss or damages, costs, charges and expenses and in the case of legal costs, costs as between attorney and client occasioned to the Bank by reason of omission, failure or default temporary or otherwise in such payment by the Borrower or by the Guarantor(s) or any of them including costs (as aforesaid) of enforcement or attempted enforcement of payment by suit or otherwise or by sale or realisation / or attempted sale or realisation of any security for the said indebtedness or otherwise howsoever or any costs (which costs to be as aforesaid) charges or expenses which the Bank may incur by being joined in any proceeding to which the Bank may be made or may make itself party either with or without others in connection with any such securities or any proceeds thereof.
3. The Guarantor(s) hereby declare/s that this guarantee shall be continuing guarantee and shall not be considered as cancelled or in any way affected by the fact that at any time the said accounts may show no liability against the Borrower or may even show a credit in borrower's favour but shall continue to be a guarantee and remain in operation in respect of all subsequent transactions.
4. The Guarantor(s) hereby consent/s to the Bank making any variance that it may think fit in the terms of the contract with the Borrower, to the Bank accepting additional or collateral security of any kind determining, enlarging or varying any credit to the borrower or making and composition with the borrower or promising to give borrower time or not to sue the borrower and to the Bank parting with any security it may hold for the guaranteed debt. The guarantor(s) also agree/s that he/she/they shall not be discharged from his/her/their liability by the Bank releasing the Borrower or by any act or omission of the Bank the legal consequence of which may be to discharge the Borrower or by any act of the Bank which would, but for this present provision, be inconsistent with his/her/their rights as guarantor(s) or by the Bank's omission to do any act which but for this present provision, the Bank's duty to the Guarantor(s) would have required the Bank to do. Though as between the Borrower and the Guarantor(s) he/she/they is/are guarantor(s) only, the guarantor(s) agree/s that as between the Bank and the guarantor(s), he/she/they is/are debtor(s) jointly with the Borrower and accordingly he/she/they shall not be entitled to claim the benefit or legal consequence of any variation in the terms of the contract and to any of the rights conferred on a guarantor-by Section 133, 134, 135, 139 and 141 of the Indian Contract Act, 1872.
5. The guarantor(s) hereby consent/s to the Bank renewing from time to time the said advance facilities referred to in para 1 above allowed to the Borrower, obtaining fresh documents from the borrower, closing the existing accounts, opening new accounts, or transferring the same or part thereof to any branch of the Bank. Notwithstanding this, the Guarantor(s) agree/s and declare/s that he/she/they shall remain liable to the Bank for any indebtedness of the Borrower under the renewed limit and the terms and conditions of the deed shall apply and govern his/her/their liability under the renewed limit.
6. The Guarantor(s) further declare/s that all dividends, compositions or payment received by the Bank from the Borrower or any other person or persons liable to him/her/them or his/her/their representative(s) shall be taken and applied as payment in gross and the Guarantor(s) and his/her/their representative(s) shall have no right to claim the benefit of any such dividends, compositions or payment until full amount of all claims of the Bank against the Borrower or his/her/their representative(s) which are covered by this guarantee shall have been paid.
7. No advance, overdraft or other credit facilities that the Bank may give to the Borrower beyond the limit(s) mentioned in para 1 above or obtaining of any other guarantee or security from the Borrower shall determine, prejudice or lessen the liability of the Guarantor(s) hereunder.
8. The Guarantor(s) further agree/s that any accounts settled between the Bank and the Borrower or the balance admitted or confirmed by him/her/them or, his/her/their authorised agent(s) as due on the said accounts to the Bank will be conclusive and shall not be disputed or questioned by the Guarantor(s).
9. The Guarantor(s) also agree/s that any balance or debts confirmed by the Borrower, or his/her/their authorised agent(s) or any acknowledgement of liability concerning the same made and signed by the Borrower or his/her/their authorised agent(s) shall be binding on the guarantor(s) in the same manner and to the same extent as if the Borrower or his/her/their authorised agent(s) was the guarantor's authorised agent to make such acknowledgement of liability or confirming the balance and the said acknowledgement and confirmation shall be binding on him/her/them, as if made by himself/herself/ themselves. The guarantor(s) further agree/s that every such acknowledgement by the borrower or his/her/their authorised agent(s) would renew the liability as Guarantor(s) and the Guarantor(s) would be liable for the payment of the acknowledged debts in the same way as for the debts hereby guaranteed.
10. The guarantor(s) also agree / s that the Bank shall be entitled to recover its entire dues on the said account from his/her/their persons or properties upon default in payment by the Borrower.
11. In case the amount guaranteed by the Guarantor(s) is paid by the Borrower to the Bank and the Bank in consequence discharges the Guarantor(s) from all liabilities under this guarantee, but it is subsequently determined by a Court of Law or otherwise that the said payment was a fraudulent preference and the Bank is made to refund the said amount, the Guarantors' liability to the Bank on the basis of this guarantee shall revive to the same extent and in the same manner as if such payment had never been made.
12. The guarantor(s) also agree/s that the Bank may enforce the guarantee by enforcing or realising any of the securities pledged or mortgaged with it notwithstanding that any bills or other instruments given by the Borrower in the said account may be in circulation for collection and outstanding. 13. The guarantee hereby given shall be a continuing security and shall not be determined unless three calendar months' written notice is given by the guarantor(s) and in the event of the guarantors' death or his/ her/their coming under a disability, the liability of the guarantors' estate shall continue unless three calendar months' notice of his/her/their instruction to determine the guarantee in writing is given to the bank by the legal representative(s) of the guarantor(s).
14. If the Guarantor(s) has / have or shall hereafter take(s) any security from the Borrower in respect of his/ her/their liability under this guarantee, the guarantor(s) will not prove in the liquidation of the Borrower in respect thereof to the prejudice of the Bank and such security shall stand as security and shall be forthwith deposited with the Bank.
15. So long as any money remains owing under this guarantee, the Bank shall have a lien on all moneys standing to the credit .of guarantor(s) and on any securities or goods in the hands of the Bank belonging to the guarantor(s) under its control.
16. The absence or infirmity in the borrowing powers on the part of the Borrower or any irregularity whatsoever in the exercise thereof shall not affect the liability of the Guarantor(s) and any money advanced to the Borrower shall be deemed to be due and owing notwithstanding such absence, infirmity or irregularity and this guarantee shall not be affected by any change in the name or constitution of the borrower. It is further expressly agreed that this guarantee shall remain enforceable against the Guarantor(s) irrespective of the fact whether the contract between the Borrower and his creditor(s) is enforceable at law or not.
17. Any notice by the Bank in writing under this guarantee or a demand in writing shall be deemed to have been duly given to the Guarantor(s) by sending the same by post addressed to him/her/them at the address hereunder written and shall be effectual notwithstanding any change of residence or death and notwithstanding the notice therefore to the Bank and such demand shall be deemed to have been received by the Guarantor(s) Twenty Four hours after the posting thereof and shall be sufficient to prove that the letter containing the demand was properly addressed and put into the Post Office.
18. The Guarantor(s) agree/s that a copy of the account of the principal debtor contained in the Bank's books of account signed by the authorised official of the Bank for the time being of the office at which such accounts shall be kept or any officer of the Bank shall be conclusive evidence against them of the amount for the time being due to the Bank from the principal debtor in any accounts or other proceedings brought against him upon this guarantee.
19. In the event of borrower(s) committing default in making due payment of the bills of exchange drawn under terms of letter of credit / guarantee, the amount payable by the bank in terms of letter of credit / guarantee and/or instalments and/or interest/ charges, etc., payable in term loan, working capital term loan, funded interest term loan and/or any other credit facility, may be debited to the open cash credit/overdraft' current account of the borrower in terms of authority already given by borrower and the bank may in its discretion grant time to the borrower for payment of such liability by enhancing the credit limit to the extent of such debits in respect of OCC/Overdraft and/or allowing overdraft in the Current Account and this guarantee shall be continuing security. The guarantee shall not be determined/ discharged by any partial payment or any fluctuation or settlement of the said OCC/OD/ Current Account or existence of a credit balance of any account at any time and that the guarantee shall continue to be in force notwithstanding that the borrower had or has no power to obtain such credit/ accommodation for the liabilities or advances as aforesaid.
20. The Guarantor(s) hereby agree/s that their liabilities as a surety are joint and several owing to statutory provisions and co-extensive with that of the Principal Debtor. When default is made by the Principal Debtor despite demand being made by the Creditor/Bank, the Creditor/Bank becomes entitled to proceed against the Guarantor(s) also and this liability of the Guarantor(s) is immediate when the Guarantor(s) refuse/s or does not co-operate in making payment of dues after demand from the Creditor/Bank. Once the Guarantor(s) has not conceded/ fails to concede to demand of the Creditor/Bank, it entails classification of the Guarantor(s) also as a Wilful defaulter(s) in accordance with extant RBI guidelines, to which the Guarantor(s) hereby gives his/her/their consent. 21. The guarantor(s) hereby agree/s and consent/s to the bank for the disclosure of all or any such i. information and data relating to the guarantor/s ii. information or data relating to the guarantor/s obligations in any credit facility granted/to be granted, by the bank and guaranteed by the guarantor/s and iii. default if any, committed by the guarantor/s in discharge of their obligations as they may deem appropriate and necessary, to disclose and furnish to Credit Information Bureau (India) Ltd., and any other agency authorised by Reserve Bank of India in this behalf.
22. The guarantor(s) further agree/s and consent/s that
Credit Information Bureau (India) Ltd., and any other agency so authorised may use, process the said information and data disclosed by the bank in the manner as deemed fit by them and Credit Information Bureau (India) Ltd., and any other agency so authorised may furnish for consideration, the processed information and data or products thereof prepared by them, to Banks/ Financial institutions and other credit grantors or registered users, as may be specified by RBI in this behalf.
In witness whereof the Guarantor(s) have set his/her/their hands hereunto on this ……………….. day of ………………………………………… 20 …..
