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Owners' guarantee undertaking
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Municipalities and county councils that are members of the Kommuninvest Cooperative Society have signed a joint and several guarantee covering all of the Kommuninvest's current and future commitments. To date, Kommuninvest has never defaulted on a payment commitment, thereby putting the members' guarantee undertaking to the test.

 

 The joint and several guarantee is the foundation on which Kommuninvest's strong creditworthiness rests. If Kommuninvest were to default on a payment obligation, the creditor is legally entitled to address one or more of the guarantors to obtain payment.


This guarantee arrangement is appreciated by Kommuninvest's creditors, since addressing all of the members individually would be administratively complicated. However, for a creditor to be able to demand payment from the members, Kommuninvest's undertaking must have matured without payment.
The guarantee undertaking is worded as follows:

 

"The undersigned Swedish county councils and municipalities herewith jointly and severally guarantee, as for a liability of their own, all obligations, liabilities and commitments presently and subsequently undertaken by Kommuninvest i Sverige AB as regulated in the Articles of Association of Kommuninvest Cooperative Society."

 

Consequently, the members bear direct responsibility for Kommuninvest's borrowed funds, payment obligations in accordance with derivative contracts and its other undertakings.

 

The guarantee undertaking is formulated as a surety subject to joint and several responsibility. The guarantee entails that the creditor, in the event of defaulted payment, may immediately demand payment from either Kommuninvest or one of the guarantors. The creditor need not first attempt to secure payment from Kommuninvest but may demand the amount in full from one or more of the members.

 

Honouring the guarantee
Should any of Kommuninvest's creditors submit to any or several of the members a demand in accordance with the guarantee, the member/s concerned shall immediately inform Kommuninvest of the matter. In turn, Kommuninvest is required to inform the member or members of any objections it may have regarding the claim and, if Kommuninvest does find cause to object, to assist the member or members in contesting the demand. Kommuninvest bears a general responsibility to assist the member/s in the handling of any demand made in accordance with the guarantee.

Unless there are no grounds for objection, Kommuninvest shall make payment to the creditor. Only if it has first been determined that Kommuninvest lacks the funds to pay the creditor is payment by the guarantor considered.

Members who have met their obligations according to the guarantee are entitled, in accordance with a special recourse agreement, to demand payment from the other members. Payment obligations are distributed in relation the degree of utilisation of Kommuninvest's services, whereby members who have borrowed more from Kommuninvest bear a greater responsibility than those who have borrowed less or nothing at all.

 

To date, Kommuninvest has never defaulted on a payment obligation and consequently the members' guarantee undertaking has never been tested.


The guarantee covers only Kommuninvest's obligations
The joint and several guarantee applies solely to the undertakings arising in Kommuninvest i Sverige AB. No member can be held accountable for other members' payment obligations as a consequence of the joint and several guarantee undertaking.

 

General guarantee
The guarantee applies to all of the company's undertakings. It is not subject to a fixed period and, in principle, applies until such time that measures are taken by the company or one of the members. Because the guarantee is formulated in general terms, new members assume liability for all of the obligations incurred by the company at the point at which they sign the guarantee and the obligations incurred by the company thereafter.

 

Responsibility of members leaving the Society
Following withdrawal or exclusion from the Society, the member's responsibility for the Company's undertakings is limited to those undertakings that existed at the point at which membership in the Society ceased. Departing members are not responsible for obligations incurred after that point.

Page last updated 2011.10.13
Kommuninvest i Sverige AB (publ)

Postal address: P.O. Box 124, SE-701 42 Örebro, Sweden • Central phone no.: +46 10 47 08 700 • Fax: +46 19 121 198 

E-mail: firstname.lastname@kommuninvest.se

Reg. No: 556281-4409 • Street address: Fenixhuset, Drottninggatan 2, Örebro, Sweden • Deliveries: Ågatan 1, Örebro, Sweden