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A parent company guarantee (PCG) is a contract between a company and its client to ensure a performance requirement is met. These agreements are used when a contractor or subsidiary enter into a contract with clients. The expectations outlined in this guarantee are detailed by the parent company.
The purpose of the parent guarantee agreement is to form a legal relationship between a parent company and client that wish to work together without risking their legal rights.
A parent guaranty is a legal agreement in which a parent company agrees to be financially responsible for the debt of a subsidiary company. If the subsidiary fails to pay their debt, the lender can pursue repayment from the parent company instead.
A parent company guarantee, or PCG, is a promise given by a contracting party's holding company. This is done in favor of the other party involved in the contract as a measure to guarantee the expected performance of contractual obligations.
A parent company guarantee (PCG) is a guarantee by a parent company of a contractor ’s performance under its contract with its client, where the contractor is a subsidiary of the parent company.
Parent company guarantees (PCGs) are often used in relation to construction project to bolster the financial reliability of a building contractor.
A parent company guarantee clause is a contractual agreement where a parent company assumes responsibility for the debts and obligations of its subsidiary or affiliate.
What is a parent company guarantee? Typically a parent or other group company of the contractor grants a guarantee in favour of the developer in terms of which that Guarantor guarantees the...
Requiring a parent guarantee is one way to reduce your risk when your counterparty does not have a strong balance sheet. With a guarantee, the counterparty's parent company (guarantor) promises to the other party (beneficiary) to pay or perform any of the obligations of the subsidiary (obligor).
This is a guide to the exemption from audit under s479A-479C of the Companies Act 2006. This guide has been prepared by ICAEW’s Business Law department with input from relevant experts from its committees or other groups supporting its work.