Agreement and Indemnity Relating to the Opening of Documentary Credits.
To (bank )
In consideration of your opening or establishing from time to time at our request such documentary credits as you may think fit on our behalf, we undertake to and agree that the following terms and conditions shall apply to all such documentary credits:
1. Acceptance and payment of drafts
We authorize you to accept and/or pay for our account all drafts purporting to be drawn under and tendered or negotiated pursuant to any such credit and to pay all sums which appear or purport to be claimed or demanded or which you are liable to pay, in accordance with or pursuant to any such credit, without any reference to, or further authority from, us and without enquiry into the justification for it or the validity, genuineness or accuracy of any statement or certificate received by you with respect to or under any such credit and despite any contestation on our part, and we agree that any such drafts or claims or demands for payment of any such sums shall be binding on us and shall as between you and us, be accepted by us as conclusive evidence that you were liable to pay or comply with them.
We undertake to pay to you on demand all amounts paid by you under any such credit or in the case of drafts accepted under any such credit to place you in funds to meet such drafts on or before maturity. In each case payment will (unless otherwise agreed or required by you ) be made in Naira [NAIRA] together with your commission and all interest, charges and expenses payable to or incurred by you in connection with the credit. Interest for these purposes shall accrue upon such amounts as stated above as well after as before judgment, from the date when such amounts were first paid by you until payment of them by us in full, at the rate of ... ) per annum above the cost to you (as conclusively determined by you ) of acquiring such funds in such currency and manner as you may from time to time decide.
We undertake to indemnify you and keep you indemnified against all liabilities, losses, damages, costs, expenses, claims and demands which you may incur or sustain by reason of your opening or establishing any such credit or arising in relation to or out of the same, including all legal and other costs, charges and expenses you may incur in connection with the enforcement, or attempted enforcement of your rights under this agreement and indemnity.
We undertake that all goods represented by or referred to in documents to be tendered under any such credit shall be kept insured in the full amount of their insurable value against loss or damage by fire and other usual risks and such other risks and with such insurance company or companies as you may from time to time specify or approve, all claims being payable in Naira unless otherwise agreed or required by you. If not included in the documents required to be tendered under any credit, we shall deposit the insurance documents with you or to your order or produce them for your inspection at any time on your request and we shall either arrange for your interest to be notified to the insurers and noted on the policies or for you to be designated as `loss payee in the policies, as you may from time to time require. We authorise you to collect the amount due under any insurance and we undertake to take such steps as you may require to collect on your behalf or to enable you to collect the amount of any such claim. We undertake not to do or permit to be done any act or thing by which any such policy may be or become invalidated, cancelled or altered. If we fail to insure as above you are to be at liberty to effect insurance at your discretion and we shall reimburse to you on demand all expenses incurred in that respect by you.
5. Payment of charges and expenses
We undertake to pay all transportation charges, landing charges, warehouse charges, storage charges and all other charges and expenses in relation to the above-mentioned goods. If we should fail to do so you are authorised to pay any such charges or expenses on our behalf and we undertake to reimburse to you on demand all such payments.
6. Debit of amounts payable
We authorise you to debit to any of our accounts with you all amounts payable by us to you under this agreement and indemnity or in connection with any such credit.
7. Further indemnity
We further agree that we shall indemnify you against any loss incurred by you as a result of any judgment or order being given or made for the payment of any amount due to you under this agreement and indemnity, and, where such judgment or order is expressed in a currency other than that in which such amount is payable by us under this agreement and indemnity, we shall indemnify you against any loss incurred by you as a result of any variation having occurred in rates of exchange between the date as at which such amount is converted into such other currency for the purposes of such judgment or order and the date of actual payment pursuant to it. This indemnity shall constitute a separate and independent obligation on our part and shall apply irrespective of any indulgence granted to us from time to time and shall continue in full force and effect notwithstanding any such judgment or order as stated above.
8. Other securities
We agree that the undertakings and agreements contained in this agreement and indemnity are in addition, and without prejudice, to any other security or securities which you may now or subsequently hold, and are not affected by any intermediate payment or settlement of account. You may at any time and without reference to us give up, deal with, vary, exchange or abstain from performing or enforcing any other such security or securities at any time and discharge any party to it or them, and realise it or any of them as you think fit without in any way affecting or prejudicing the undertakings and agreements contained in this agreement and indemnity.
9. Effect of non-payment etc
Failing payment or performance by us on the due date for such payment or performance or on demand (as the case may be ) of any sum or liability or obligation mentioned in this agreement and indemnity, you are to be at liberty, at any time or times subsequently, without notice to us and without our consent and without prejudice to any other right or remedy you may have, to sell the goods represented by, or referred to in, documents to be tendered under any credit in such manner and at such price or prices and whether upon tender of cash or credit, without being responsible for loss, as you may deem expedient and to apply the net proceeds of sale in or towards payment of any such sum or liability as stated above as you may think fit. In the event that the net proceeds of sale actually received shall be insufficient to cover the whole of our indebtedness and liabilities to you, we undertake to pay to you immediately on demand any balance which may then be due.
10. Execution of transfers etc
We shall on request by you at any time or times execute and sign all such transfers, powers of attorney, further assurances or other documents and do all such other acts and things as you may require to realise or to vest the goods or any of them in you or your nominees or a purchaser or transferee or to perfect or preserve your rights and interests under or pursuant to the undertakings and agreements contained in this agreement and indemnity (including the institution and conduct of legal proceedings ). We irrevocably and by way of security appoint you and any persons nominated in writing under the hand of any of your officers as our attorney and in our names and on our behalf to execute and do all assurances, acts and things which you deem necessary or desirable for the above-mentioned rights and purposes.]
11. Exclusion of liability
We agree that you are not in any circumstances to be held responsible for any detention, loss or deterioration of, or any damage to, the goods or for any failure to insure them, or for their quantity, quality, condition or delivery or the correctness, validity, sufficiency or genuineness of any of the documents relating to them.]
12. Payments to be made in full
All payments to be made by us to you shall be made in full without set-off or counterclaim and free and clear of and without deduction of or withholding for or on account of any tax of any nature now or subsequently imposed unless we are compelled by law to make such withholding or deduction. If any such payment shall be subject to any such tax or if we shall be required to make any such deduction or withholding, we shall pay such tax, shall ensure that such payment, deduction or withholding will not exceed the minimum legal liability for it and shall simultaneously pay to you such additional amount as may be necessary to enable you to receive, after all such payments, deductions and withholdings, a net amount equal to the full amount payable. If we shall make any such payment, deduction or withholding we shall within 30 days afterwards forward to you an official receipt or other official documentation evidencing such payment or the payment of an amount equivalent to such deduction or withholding. As used in this clause, the term `tax includes all levies, imposts, duties, charges, fees, deductions, withholdings, stamp duties and any restrictions or conditions of any nature.
13. Change in constitution and death
The provisions of this agreement and indemnity shall not be determined or affected [by any change in our constitution or by the death of any one or more of us but in the event of any such death the notice of termination referred to in clause 14 below may be given by any survivor or survivors of us or by the personal representatives of any one or more of us who have died].
14. Notice of termination
[We or Any one or more of us] may at any time give you notice in writing to determine the undertakings and agreements evidenced by this agreement and indemnity (the date of receipt of such notice by you to be known as `the Cessation Date ) and, at the expiry of 3 calendar months after the receipt by you of such notice, these undertakings and agreements shall cease with respect to credits opened or established after the Cessation Date PROVIDED that such notice shall not terminate any credit outstanding at the Cessation Date or which will or may arise under or in respect of any credit opened or established either prior to the Cessation Date or on or after the Cessation Date pursuant to any commitment express or implied assumed or undertaken by you to us prior to the Cessation Date.
15 Determination of credit
You are to be at liberty at any time to determine any such credit other than an irrevocable credit.
16. Effect of delay or omission
No delay or omission on your part in exercising any right, power, privilege or remedy in respect of these undertakings and agreements shall impair such right, power, privilege or remedy or be construed as a waiver of it nor shall any single or partial exercise of any such right, power, privilege or remedy preclude any further exercise of it or the exercise of any other right, power, privilege or remedy. The rights, powers, privileges and remedies provided in this agreement and indemnity are cumulative and not exclusive of any rights, powers, privileges or remedies provided by law.
17. Joint and several liability
Where this agreement and indemnity is signed by or on behalf of a partnership or otherwise by or on behalf of more than one person, any liability arising under it shall be deemed to be the joint and several liability of the partners or of such persons as stated above and any demand for payment made or notice given by you to any one or more of the persons so jointly and severally liable shall be deemed to be a demand made or notice given to all such persons. You are to be at liberty to release or discharge any one or more of such persons from liability under this undertaking or to compound with, accept compositions from or make any other arrangements with any of such persons without in consequence releasing or discharging any other party to this agreement and indemnity or otherwise prejudicing or affecting your rights and remedies against any such other party.]
In this agreement and indemnity, where the context so permits, the singular includes the plural and vice versa and references to persons include references to companies.
[(in the case of a company )
The common seal of [name of company] was affixed hereto in the presence of
Executed and delivered as a Deed by ..............................
acting by a director and secretary or two directors
pursuant to a resolution duly passed at a duly convened and held meeting of its board of directors a certified copy of which is annexed to this Agreement and indemnity.
(or in the case of individuals )
Executed and delivered as a Deed by (insert name of signatories )
Signed, sealed and delivered by [name of each signatory] in the presence of:
Signed in the presence of:
(repeat as necessary )]