The guarantee is the foundation for Kommuninvest’s strong creditworthiness. The 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 the Kommuninvest Cooperative Society.”
Consequently, the members bear direct responsibility for Kommuninvest’s borrowed funds, payment obligations in accordance with derivative contracts and its other commitments.
Creditors may require payment directly from guarantors
The guarantee is formulated as a surety subject to joint and several responsibility. This entails that the creditor, in the event of a payment default, may immediately demand payment from either Kommuninvest or from 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.
New members also become responsible for commitments entered into previously
The guarantee applies to all of the company’s commitments. 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 commitments incurred by the company at the point at which they sign the guarantee and the obligations incurred by the company thereafter.
The guarantee applies until outstanding commitments mature
In accordance with the guarantee, the members are responsible for all of the company’s outstanding commitments until they mature. On leaving or being excluded, the member is responsible for its share of the commitments incurred up until the member’s departure from the society.
After having left or been excluded, former members are not responsible for new commitments
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 of the society ceased. Departing members are not responsible for obligations incurred after that point.
The guarantee only covers the commitments of Kommuninvest i Sverige AB
Following withdrawal or exclusion from the society, the member’s responsibility The joint and several guarantee applies solely to the undertakings arising in Kommuninvest i Sverige AB. No member can, as a consequence of the joint and several guarantee undertaking, be held accountable for commitments incurred by other members outside of Kommuninvest i Sverige AB.