Letters of Credit Master Agreement
between Citibank N.A. and IPCRe Limited
Insurance Letters of
Credit — Master Agreement
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Citibank,
N.A,
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Form 3
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336
Strand
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London, WC2R
1HB
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Insurance Letters of
Credit — Master Agreement
Insurance/ Reinsurance Companies
or Brokers
The
purpose of this letter is to record our agreement (the
“Agreement”) to the following method of establishing
letters of credit or similar or equivalent instruments acceptable
to you (each a “Credit” and collectively “the
Credits”) on our behalf in favour of beneficiaries located in
the United States of America or elsewhere. In connection with this
Agreement, we have also separately agreed with you the contractual
or security arrangements that will apply in respect of our
obligations under or pursuant to this Agreement.
1. It is agreed between us in relation to each Credit
that:-
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(a) you
will, upon receipt of an application form for the establishment of
a letter of credit in such form as you may be willing to accept for
this purpose and which may, without limitation, be received by you
via any electronic system(s) or transmission arrangement(s)
acceptable to you (referred to in this Agreement in relation to any
Credit as an “application form” ) completed by us or on
our behalf in accordance with the terms of our banking mandate(s)
or other authorities lodged with you or arrangement(s) made with
you from time to time and indicating therein the name of the
beneficiary and the amount and term of the Credit required,
establish on our behalf an irrevocable clean sight Credit (or such
other form of Credit as may be required by the application form
relating thereto) available, in whole or in part, by the
beneficiary’s sight draft on Citibank N.A. or otherwise as
may be required by the terms of the Credit; provided, however, that
the opening of any Credit hereunder shall, in every instance, be at
your option and nothing herein shall be construed as obliging you
to open any Credit;
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(b) we
undertake to reimburse you, on demand, the amount of any and all
drawings under the Credit;
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(c) we
undertake to indemnify you, on demand, for and against all actions,
proceedings, losses, damages, charges, costs, expenses, claims and
demands which you may incur, pay or sustain by reason of or arising
in any way whatsoever (apart from your own gross negligence or
wilful misconduct) in connection with each Credit and/or this
Agreement;
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(d) we
undertake to pay to you, on demand, such fees and/or commissions of
such amount(s) and/or at such rate(s) as shall have been or as may
be advised by you to us as payable in connection with each
Credit;
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(e) we
hereby irrevocably authorise you to make any payments and comply
with any demands which may be claimed from or made upon you in
connection with each Credit without any reference to or further
authority from us and we hereby agree that it shall not be
incumbent upon you to enquire or to take notice whether or not any
such payments or demands claimed from or made upon you in
connection with each Credit are properly made or to enquire or to
take notice whether or not any dispute exists between ourselves and
the beneficiary thereof and we further agree that any payment which
you shall make in accordance with the terms and conditions of each
Credit shall be binding upon us and shall be accepted by us as
conclusive evidence that you were liable to make such payment or
comply with such demand; and
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(f) we
represent and warrant to you and undertake that:-
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(i) we have
and will at all times have the necessary power to enable us to
enter into and perform the obligations expressed to be assumed by
us under this Agreement;
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(ii) this
Agreement constitutes our legal, valid, binding and enforceable
obligation effective in accordance with its
terms; and
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(iii) all
necessary authorisations to enable or entitle us to enter into this
Agreement have been obtained and are in full force and effect and
will remain in such force and effect at all times during the
subsistence of this Agreement.
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2. Where an application form has been completed by or on
behalf of any other applicant(s) with whom you have entered into an
agreement similar or equivalent in effect to this Agreement, and a
separate application form has been completed by us or on our behalf
which corresponds, in your opinion, with such other application
form (or any other combination of circumstances exist which, in
your opinion, are reasonably equivalent to the foregoing) then you
shall be at liberty to open a single Credit on behalf of ourselves
and such other applicant(s) jointly and in that event the following
provisions shall apply:-
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(a) our
obligations pursuant to paragraph 1(b) above shall be in
respect of our due proportion of each drawing under any such
Credit;
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(b) in
establishing our due proportion of each drawing under any such
Credit you are hereby irrevocably authorised to make
apportionment’s between ourselves and such other applicant(s)
(i) on a pro rata basis by reference to the amounts set forth
in the application forms originally completed by us and them in
respect of such Credit (and after taking into account any
subsequent increases or decreases in such Credit effected by you
for our or their respective accounts) or, if you should so choose
(ii) in reliance on the instructions and advice of and
information provided by the relevant Insurance
Broker; and
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(c) for the
purposes of paragraph 1(c) above, you may make any required
apportionments in such manner as you, in your sole discretion,
consider to be fair and reasonable.
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3. You may refer any query or problem arising in connection
with this Agreement or any transaction hereby contemplated to the
relevant Insurance Broker or respond to any question relating to
the status of any Credit made by the relevant Insurance Broker
(and, in such response, if you consider that it is material to make
reference to the subject matter of any other agreement(s) now or
hereafter entered into between us in connection with this
Agreement, you may disclose such information relating thereto
as
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