Amending Finance Documents Without Losing Your Guarantee – Best Practice

Amending guaranteed obligations without killing the guarantee is tricky. The notorious decision in Triodos v. Dobbs [2005] All ER 364 (and related cases) often makes it unwise just to rely on the excellent and meticulous drafting in the guarantee in the LMA leveraged finance facilities agreements (the LMA Guarantee) to prevent amendments to finance documents from discharging the guarantee. The main options for ensuring the facility remains guaranteed then become:

• (unless the amendments are clearly trivial or pro-guarantor), the guarantor contemporaneously consenting to amendments to the guaranteed obligations and confirming its guarantee will extend to the amended obligations; or