TERMS AND CONDITIONS GOVERNING ISSUANCE OF IRREVOCABLE DOCUMENTARY CREDIT
1. Except so far as expressly stated herein, this irrevocable documentary credit ("Credit") shall be subject to the Uniform Customs and Practice for Documentary Credits (2007 Revision), International Chamber of Commerce Publication No. 600 ("UCP") or any future revision thereof. The terms used herein shall have the same meanings as are set out in the UCP. This agreement and all contracts arising out of it are to be construed according to Singapore law. Notwithstanding the foregoing, in the event of any conflict between the terms herein and the UCP, the terms herein shall prevail.
2. We authorise you to accept and/or pay for our account all documents purporting to be presented under and tendered or negotiated pursuant to this Credit without any reference or further authority from us and without inquiry into the justification for it or the validity, genuineness or accuracy of any statement or certificate received by you with respect to or under this Credit and despite any contestation on our part and we agree that any such draft(s) 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.
3. We agree:
(a) to pay interest at the rate fixed by you from time to time with monthly rests from the date of the draft(s) to the date of payment by you;
(b) to pay your usual commission and all expenses and agent's charges (if any);
(c) that the relevant rate of exchange is the current rate of exchange at the date of payment unless otherwise agreed;
(d) to pay to you on demand all amounts paid by you under this Credit or in the case of draft(s) accepted under the Credit to place you in funds to meet such draft(s) on or before maturity. In each case, payment will (unless otherwise agreed or required by you) be made in the currency which is the legal tender of the place of payment together with your commission and all interest, charges and expenses payable to or incurred by you under or in connection with or in respect of this Credit, including but not limited to such commissions, interests, charges and expenses payable by you to your correspondent banks. Interest for these purposes shall accrue upon such amounts as stated above (as well after as before judgement) from the date when such amounts were first paid by you until payment of these accounts by us in full at such percentage rate per annum (as conclusively determined by you) above the costs to you of accruing such funds in such currency and manner as you may from time to time decide;
(e) in the event that any currency exchange is necessary in order for you to meet your obligations under the Credit and/or for us to satisfy our obligations hereunder, all exchange risks are to be borne by us alone; and
(f) that the negotiation of the draft(s) drawn under this Credit may at your discretion be confined to your branch or agents.
4. We undertake to indemnify you against all liabilities, losses, costs, damages, expenses, claims and demands which you may suffer, incur or sustain by reason of your issuing or establishing this Credit or arising in relation to or out of this Credit or otherwise howsoever, including all legal and other costs (on a full indemnity basis), charges and expenses that you may incur in connection with enforcement or attempted enforcement of your rights herein or in respect of this Credit and to provide you with funds on demand with which to meet all such payment made by you or by the correspondent bank and all draft(s) drawn or accepted by you or by the correspondent bank together with all interest, commission, charges, disbursement and expenses of whatsoever nature due to or incurred or defrayed by you or by the correspondent bank in relation to any such Credit.
5. We further undertake to indemnify you against any loss incurred by you as a result of any judgement or order being given or made for the payment of any amount due to you under this terms and conditions and where such judgement or order is expressed in a currency other than that in which such amount is payable by us, 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 judgement and order and the date of actual payment pursuant to it. We agree that 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 judgement or order as stated above.
6. Notwithstanding Clause 4 above, we authorise you to debit any of our accounts with you with all monies for which you may be or become liable to pay under or by virtue of the terms and conditions herein or under or in connection with or in respect of this Credit. In the event that the balance in any and/or all such accounts is insufficient to cover such payments, we hereby authorise you to debit the deficiency to any one of our accounts with you and to charge interest thereon according to your banking customs and practice in respect of such accounts until all out indebtedness thereunder shall have been paid in full.
7. In addition to any general lien, right of set-off or any other right to which you may be entitled by law, you may at any time at your discretion and without notice to us set-off or transfer any sum standing to the credit of our account or any of us from time to time (including any fixed deposit account, notwithstanding that any deposit on such fixed deposit account has not matured or any of the special conditions applicable to the deposit have not been satisfied) in or towards payment or satisfaction of all or any monies or liabilities (whether actual or contingent) due or owing to you under or in connection with or in respect of this Credit.
8. We shall hold you and your agent(s) free from any responsibility for:
(a) any delay, mistake or omission in transmission or non-delivery of telegrams or other mechanically transmitted messages of the instructions;
(b) any errors in translation or interpretation of such instructions;
(c) the validity, accuracy, genuineness of the terms and conditions or the sufficiency of any of the documents tendered.
(d) the correctness of the description, quantity, quality or value of the goods or of the charges as stated in invoices or bills of lading or other documents;
(e) the terms and conditions of sufficiency of any insurance of the goods;
(f) any detention, loss, deterioration of or any damage to the goods or failure to insure them; and
(g) any act, error, neglect, default, omission, insolvency of any of your correspondent banks.
9. We undertake that all goods represented by or referred to in documents to be tendered under this 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. If not included in the documents required to be tendered under this Credit, we shall deposit the insurance documents with you or to your order or produce them for your inspection at any time at 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 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 and/or at any time you consider the insurance effected as inadequate for any reason whatsoever, 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 to you.
10. The said documents and the goods shipped shall be held by you as security for all or any monies for which we may be liable to you under the Credit and in default of payment on the presentation of the draft(s) drawn under this Credit, you may without giving any notice to us sell the goods or any part thereof by public auction or private contact and apply the net proceeds in or towards payment of the draft(s) or any other monies including interest for which we shall be liable to you under this Credit and if the proceeds should be insufficient, to pay you the amount of any deficiency on demand. In case of loss of the goods shipped, we shall not claim against you in respect of the insurance of the goods shipped and you shall be entitled to obtain payment of the monies payable under the policy of insurance thereof and to apply the net proceeds in the manner herein provided. We shall have no claim against you whatsoever in respect of any such goods or the documents relating thereto.
11. We agree that this is a continuing security and the undertakings and agreements contained herein 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.
12. You may at any time and without reference to us give up, deal, 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 and vary the terms and conditions of this Credit without any way affecting or prejudicing the undertakings and agreements contained herein.
13. We agree that we will provide such further security as may be required by you from time to time.
14. We undertake to sign, execute and deliver any transfers, powers of attorneys, deeds or documents which you may require us to sign, execute and deliver for perfecting your title to the goods and the said documents and to do all such other acts and things as you may require for vesting the same to any purchaser or purchasers from you or to perfect or preserve your rights and interests under or pursuant to the undertakings and agreements contained herein. 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 behalf to execute and do all assurances, acts and things which you deem necessary or desirable for the abovementioned rights and purposes.
15. On arrival of the goods you shall be at liberty to have them warehoused in your name and insured against fire but without obligation on you to so warehouse and insure and you will be in no way responsible for any loss or damage entailed through your omission to so warehouse and insure.
16. 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. 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, and 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 I/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, imports, duties, charges, fees, deductions, withholdings, turnover tax, transaction tax, stamp tax and any restrictions or conditions of any nature.
17. We agree that any action, process or other steps taken by you under or in connection with such documentary credits, the goods or the documents if in good faith and in conformity with such foreign or domestic laws, customs or regulations as you or any of your correspondents may deem to be applicable shall be binding upon me/us and shall not place you under any resulting liability to us. In addition, we will endeavor to procure promptly when necessary licenses for the goods covered by this Credit and will comply with all Governmental regulations, foreign or domestic (including exchange regulations) with regard thereto or the financing thereof and will supply you when required with documentary evidence of such licenses and compliance.
18. The rights and powers conferred by this agreement are in addition and without prejudice to any other securities which you may now or hereafter hold for our account and this agreement shall continue in force and be applicable to all transactions notwithstanding any change in the status or constitution of our company or the individuals composing our firm (as the case may be) or otherwise.
19. You may restrict negotiations under any such credit to your own offices or to any correspondent of your choice.
20. For the purposes of this Credit, the date of any bill of lading shall be deemed to be conclusive of the date of shipment and the absence in any bill of lading of any positive evidence of transhipment shall, in your favour, be conclusive that transhipment has not taken place.
21. On no account shall any claim be made against you after the draft(s) have been accepted or paid by us.
22. We acknowledge that the Credit shall be issued entirely at our own risk and that we shall honour all drafts presented thereunder even should the goods not arrive or be refused landing whether through any act of war or prohibition or restriction imposed by bye-laws, regulations, ordinances, statutes or executive decisions whether of the control of local government or for any other reason.
23. 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.
24. This agreement shall be subject to such further and/or other terms and conditions that may be agreed upon in respect of any such individual documentary credits that you may issue at our request from time to time
25. This agreement shall be governed by and construed in accordance with the law of the Republic of Singapore and it is irrevocably agreed for your exclusive benefit that the courts of the Republic of Singapore are to have jurisdiction to settle any disputes which may arise out of or in connection with this agreement and indemnity and that accordingly any suit, action or proceeding arising out of or in connection with this agreement and indemnity (hereinafter referred to as “Proceedings”) may be brought in such courts. Nothing in this clause shall limit your right to take Proceedings against me/us in any other court of competent jurisdiction, nor shall the taking of Proceedings in one or more jurisdictions preclude the taking of Proceedings in any other jurisdiction whether concurrently or not.
26. If at any time any of the terms contained herein is or becomes illegal, invalid or enforceable in any respect, the legality, validity and enforceability of the remaining terms of this agreement shall not be affected or impaired thereby.
27. The Contract (Rights of Third Parties) Act, Cap 53B of Singapore (the “Act”) shall not apply to this agreement and a person who is not a party to this agreement shall have no rights under the Act to enforce or to enjoy the benefit of any term of this agreement.