Exhibit 10.20

FI N° 25.350

Serapis N° 20080700

Autoliv Safety Systems R&D

RSFF

(France, Germany and Sweden)

Deed of Guarantee and Indemnity

between

European Investment Bank

and

Autoliv Inc.

Stockholm, 17 December 2009

Luxembourg, 18 December 2009

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MADE BETWEEN:

European Investment Bank having its Head Office at 100, boulevard Konrad
Adenauer, Luxembourg-Kirchberg, Grand Duchy of Luxembourg,

hereinafter called: the “Bank”

of the first part,

Autoliv Inc., a corporation incorporated in Delaware, USA, having its business
office at Klarabergsviadukten 70, SE 111 64, Stockholm, Sweden,

hereinafter called: the “Guarantor”

of the second part.

 

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WHEREAS:

 

•  

By an agreement (the “Finance Contract”) dated on or about 17 December 2009 and
made between the Bank and Autoliv AB (publ) (the “Borrower”) and the Guarantor,
the Bank has agreed to establish in favour of the Borrower a credit equivalent
to EUR 225 million;

 

•  

The obligations of the Bank under the Finance Contract are conditional upon the
prior execution and delivery by the Guarantor of a guarantee of performance by
the Borrower of its financial obligations under the Finance Contract;

 

•  

The board of directors of the Guarantor has determined that the issue of a
guarantee of the Borrower’s financial obligations is a transaction in the
interests of the Guarantor and has approved the terms of this Deed of Guarantee
and Indemnity (this “Guarantee”) and has authorised the signatory/signatories to
execute it on that Guarantor’s behalf (Annex I); and

 

•  

The Borrower is indirectly a 100% owned subsidiary of the Guarantor and the
Guarantor is the ultimate parent company of the Autoliv group of companies;

 

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NOW THEREFORE it is hereby agreed as follows:

ARTICLE 1

Finance Contract

The Guarantor, in its respective capacity as guarantor, acknowledges notice of
the provisions of the Finance Contract.

Terms defined in the Finance Contract shall have the same meaning when used
herein.

ARTICLE 2

Guarantee

 

2.01 Payment

In consideration of the credit established by the Bank under the Finance
Contract, the Guarantor hereby guarantees the payment of all Guaranteed Sums.
The Guarantor undertakes that, if the Borrower should fail to pay any Guaranteed
Sum to the Bank, whether upon the normal due date, upon acceleration or
otherwise unless such failure is caused by a technical or administrative error
and payment is made within 3 (three) Business Days after the due date, the
Guarantor shall pay the sum in question to the Bank as if it had been the
principal obligor (“surety”), in the currency specified in the Finance Contract
and to the account specified in the demand.

For the purposes of this Guarantee a “Guaranteed Sum” means any principal,
interest, commission, indemnity, liquidated damages, charge, expense or other
sum which is expressed to be payable from time to time by the Borrower to the
Bank under or pursuant to the Finance Contract and any other sum due from time
to time by the Borrower in connection with any advance or credit extended under
the Finance Contract.

The Guarantor further agrees and undertakes to pay interest to the Bank at the
rate and on the terms specified in the Finance Contract for payment of overdue
sums on all sums demanded under this Guarantee from the date of the Bank’s
demand until the date of receipt of such sum by the Bank.

 

2.02 Nature of the Guarantor’s Liability

The obligations of the Guarantor hereunder are those of a primary obligor and
not merely those of a surety. They shall not be impaired or discharged by reason
of:

 

  (a) illegality, invalidity or unenforceability in or of the terms of the
Finance Contract or any other security for the Borrower’s obligations
thereunder;

 

  (b) disability, incapacity or change in status or constitution of the
Borrower, the Bank or any other party;

 

  (c) liquidation or insolvency of the Borrower or any other party;

 

  (d) time or other indulgence granted by the Bank or any arrangement entered
into or composition accepted by the Bank, varying the rights of the Bank under
the Finance Contract or any security arrangement;

 

  (e) forbearance or delay on the part of the Bank in asserting any of its
rights against the Borrower under the Finance Contract; or

 

  (f) any circumstance, other than actual payment of a Guaranteed Sum, which
might otherwise discharge or diminish the obligations of the Guarantor.

 

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2.03 Indemnity

As a continuing obligation additional to and separate from those set out in
Articles 2.01 and 2.02, and without prejudice to the validity or enforceability
of those obligations, the Guarantor unconditionally and irrevocably undertakes
that, if any Guaranteed Sum should not be recoverable from the Guarantor under
Article 2.01 for whatsoever reason, and whether or not the reason may have been
known to the Bank at any material time, the Guarantor shall, upon first written
demand by the Bank, and as if it was a sole and independent obligor, compensate
the Bank by way of a full indemnity for all loss resulting from the failure of
the Borrower to make payment of any Guaranteed Sum in the amount and currency
provided for by or pursuant to the Finance Contract, whether upon the normal due
date, upon acceleration or otherwise.

 

2.04 Continuing Security

This Guarantee is a continuing Guarantee and shall endure until all Guaranteed
Sums have been fully paid or discharged. No payment or discharge which may be
avoided under any enactment relating to insolvency, no payment or discharge made
or given which is subsequently avoided and no release, cancellation or any such
discharge of this Guarantee given or made on the faith of any such payment or
discharge shall constitute discharge of the Guarantor under this Guarantee or
prejudice or affect the Bank’s right to recover from the Guarantor to the full
extent of this Guarantee. The original(s) of this Deed of Guarantee and
Indemnity which are in the possession of the Bank shall remain the property of
the Bank after any release, cancellation or discharge of this Guarantee.

 

2.05 Application of Payments

Any money received in connection with this Guarantee may be placed by the Bank
to the credit of a suspense account with a view to preserving the right of the
Bank to prove for the whole of the claims against the Borrower or may be applied
by the Bank in or towards satisfaction of such of the Guaranteed Sums as the
Bank in its absolute discretion may from time to time determine; provided,
however, that if any such money, being freely disposable by the Bank, is not
applied towards satisfaction of the Guaranteed Sums for which payment of the
money was made hereunder, the Guarantor’s responsibility in respect of the
Guaranteed Sums shall be discharged to the extent of such payment.

For the avoidance of doubt, the Bank will not charge the Guarantor interest at
the rate and on the terms specified in the Finance Contract for payment of
overdue sums on any amount received in connection with this Guarantee, placed by
the Bank to the credit of a suspense account, and which are applied towards
satisfaction of the Guaranteed Sums.

 

2.06 Covenants of the Guarantor

The Guarantor agrees that until all the Guaranteed Sums have been fully paid or
discharged:

 

  (a) it shall not seek to enforce any obligation owed to it by the Borrower
which arises by virtue of the discharge by it of its obligations hereunder;

 

  (b) it shall pay to the Bank all dividends in liquidation or otherwise
received by it from or for the account of the Borrower in respect of any
obligation referred to in indent (a) above; the Bank shall apply such sums to
reduce the outstanding Guaranteed Sums in such sequence as it may decide; and

 

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  (c) it shall not exercise any right of subrogation to the rights of the Bank
under the Finance Contract or any security granted in connection therewith.

 

2.07 Acknowledgement

The Guarantor acknowledges: (i) that it has entered into this Guarantee on the
basis of its own assessment of the Borrower and any security provided, and
(ii) that it has not been induced to enter into this Guarantee by any
representation made by the Bank. The Bank is not obliged to report to the
Guarantor on the financial position of the Borrower or on any security provided,
if any. The Bank shall have no liability for granting or disbursing the Loan,
for cancelling or not cancelling the credit or for demanding or not demanding
prepayment under the Finance Contract.

ARTICLE 3

Enforcement of Guarantee

 

3.01 Certificate Conclusive

Subject to Article 2.01, a certificate of the Bank as to any default by the
Borrower in the payment of any Guaranteed Sum as set out in Article 10.01 of the
Finance Contract shall, in the absence of manifest error, be conclusive against
the Guarantor.

 

3.02 Guarantor’s Obligations Unconditional

The Guarantor undertakes to pay all sums due hereunder in full, free of set-off
or counterclaim. This Guarantee may be enforced by the Bank upon provision of a
statement of the reason for the demand. The Bank shall not be obliged to take
any action against the Borrower or to have recourse to any other guarantee as a
condition precedent to the enforcement by the Bank of this guarantee.

 

3.03 Guarantor’s Option

Where the Bank makes any demand hereunder, the Guarantor may pay to the Bank all
outstanding Guaranteed Sums, including sums arising under Article 4.02 of the
Finance Contract, in settlement of its obligations hereunder. If the Guarantor
makes such payment, the Bank shall, upon the request and at the expense of the
Guarantor, assign to the Guarantor the Bank’s rights under the Finance Contract
and under any security therefor.

 

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ARTICLE 4

Amendment to the Finance Contract

The Bank may agree to any amendment or variation to the Finance Contract if:

 

(a) the amendment or variation does not increase the amounts payable by the
Guarantor under this Guarantee or change the conditions under which such amounts
are payable; or

 

(b) the amendment or variation consists in the extension of time for payment of
a Guaranteed Sum of up to three months; or

 

(c) the Guarantor has given its prior written consent to the amendment or
variation, provided that such consent may not unreasonably be refused or
delayed.

ARTICLE 5

Taxes, Charges and Expenses

The Guarantor shall bear its own costs of execution and implementation of this
Guarantee and, without prejudice to the terms of Article 2, shall indemnify the
Bank against all:

 

(a) taxes and fiscal charges, legal costs and other expenses incurred by the
Bank in the execution or implementation of this Guarantee; and

 

(b) losses, charges and expenses to which the Bank may be subject or which it
may properly incur under or in connection with the recovery from any person of
sums expressed due under or pursuant to the Finance Contract.

Furthermore the Guarantor shall make payments hereunder without withholding or
deduction on account of tax or fiscal charges.

ARTICLE 6

Law and Jurisdiction

 

6.01 Law

This Guarantee, its formation and its validity shall be governed by and
construed in all respects in accordance with the laws of England.

 

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6.02 Jurisdiction

The parties hereto submit to the jurisdiction of the Courts of England and all
disputes concerning this Guarantee shall be submitted to such court.

The Bank appoints The Securities Management Trust Limited of 8 Lothbury London
EC2R 7HH to be its attorney for the purpose of accepting service on its behalf
of any writ, notice, order, judgement or other legal process.

The Guarantor appoints Autoliv Holdings Limited of 44 Welbeck Street London
W1G 8DY to be its attorney for the purpose of accepting service on its behalf of
any writ, notice, order, judgment or other legal process.

 

6.03 Invalidity

If any provision hereof is invalid, such invalidity shall not prejudice any
other provision hereof.

 

6.04 No assignment

The Guarantor shall not assign all or any part of its rights or benefits under
this Guarantee.

ARTICLE 7

Final Clauses

 

7.01 Notices

Notices and other communications given hereunder (other than such as arise out
of litigation) to the Guarantor or to the Bank shall be sent out by facsimile,
telex, telegram, registered letter or letter with recorded delivery addressed to
it at its address set out below or at such other address as it shall have
previously notified to the other in writing as its new address for such purpose:

 

•     For the Bank:

  Attention: Ops A   100 boulevard Konrad Adenauer   L-2950 Luxembourg  
Facsimile no. +352 4379 63697

•     For the Guarantor:

  Attention: Treasurer   World Trade Center   Klarabergsviadukten 70   Box 703
81   SE – 107 24 Stockholm   Sweden   Facsimile no.: +46 8 24 44 93

 

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7.02 Recitals and Annexes

The Recitals form part of this Guarantee.

The following Annex is attached hereto:

 

Annex I:   Resolution of Board of Directors of the Guarantor and authorisation
of signatory

IN WITNESS WHEREOF the parties hereto have caused this Guarantee to be executed
in four originals in the English language.

 

SIGNED as a DEED

for and on behalf of

EUROPEAN INVESTMENT BANK

 

EXECUTED as a DEED

for and on behalf of

AUTOLIV INC.

 

J. Link

Director

 

E. Falvey

Senior Legal Counsel

  Lars Sjŏbring   Jan Carlson

This 17th day of December 2009, at Stockholm

This 18th day of December 2009, at Luxembourg

 

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Annex I

Resolution of Board of Directors of the Guarantor

and authorisation of signatory

 

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