Equity commitment letters are essentially ubiquitous in private equity deals and guarantees are common when debt financing and reverse termination fees are in the mix. In this Dealology video, we discuss what equity commitment letters and guarantees are, why and when they are used and a few key business points, including the amount of the commitment and guarantee, who gets to enforce the obligations and termination. This video goes hand-in-hand with our Dealology video #4 – Reverse Termination Fees and Specific Performance, to be released October 16, 2019.
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