Indemnity Agreement
Indemnity Agreement
THIS INDEMNITY AGREEMENT (the “Agreement”) is made and entered into at _________ on this __________ day of _________, 2013 by and between
M/s ________________ a company incorporated under the laws of Pakistan and having its place of business at ______________ (hereinafter referred to as the “Customer”) which expression shall wherever the context so permits include its successors-in-interest, representatives, nominees and assigns.
OR
Mr/Mrs ___________ S/o / D/o _________, r/o ___________ (hereinafter referred to as the “Customer”) which expression shall wherever the context so permits include its successors-in-interest, representatives, legal heirs, nominees and assigns.
AND
M/s ____________ a company incorporated under the laws of Pakistan and having its place of business at ________ Lahore (hereinafter referred to as the “Bank”) which expression shall wherever the context so permits include its successors-in-interest, representatives, assigns.
WHEREAS BANK has extended finance facilities to the Customer from time to time on the representation of the Customer that the Customer has been complying with the Prudential regulations of the State Bank of Pakistan (SBP) and has not committed any act which is in violation of the rules and regulations of SBP.
AND WHEREAS the Customer undertakes to pay all levies, charges and such other penalties as may be imposed by the SBP from time to time due to its non compliance with any rules and regulations of SBP.
AND WHEREAS the Customer further undertakes that in case any amount is recovered from BANK by SBP due to the failure of the Customer to comply with the Prudential Regulations of SBP or any other rules and regulation laid down by SBP in order to regulate the banking activities then the Customer shall fully indemnify BANK against any such exposure.
NOW THEREFORE the parties agree as follows:
Definition:
“Regulation” mean and include all rules, regulations and directions of the State Bank of Pakistan including without limitation all Prudential Regulations and other rules, notifications and/or circulars.
“Due Amount” means all such amounts that may recovered from or payable by BANK as penalties, charges, levies, etc. that may be imposed by SBP due to the non compliance of the Regulations.
- That the Customer undertakes that the Company is fully responsible for payment of the Due Amount that may be imposed by SBP due to any violation of the Regulations.
- That in case due to any act of the Customer or any other non compliance with the Regulations, the Due Amount is recovered from BANK then the Customer undertakes to fully indemnify and hold harmless BANK against any such recovery.
- That the BANK is exposed to any liability as mentioned above than BANK shall make a written demand to the Customer for payment of the Due Amount by the BANK and the Customer shall be liable to reimburse the BANK within 7 days of such demand. It is pertinent to mention that such written demand by BANK shall be a conclusive proof of the Due Amount.
- That in case the Customer fails to pay the Due Amount so demanded by BANK then BANK shall be entitled without notifying the Customer to inter alia debit all or any account(s) of the Customer being maintained with BANK. In addition, BANK shall have a right to exercise all legal remedies that may be available to BANK under law.
- That in case of non payment of the Due Amount within 7 days of the demand, BANK shall be entitled to recover and the Customer shall be liable to pay a sum of Rs. ___________ as penalty for each month’s delay.
- That the Customer undertakes to indemnify and holds harmless BANK, its officers and employees and hold them harmless against any losses, claims, damages or liabilities to which BANK may become subject including without limitation the following:
(a) all claims, action, demands, liabilities, that may be made against BANK by SBO due to the violation or non compliance of the Regulations, and
(b) all losses, costs, charges and expenses (including but not limited to fees and expenses incurred in connection with the investigation of, preparation for, or defence of, any inquiry, inspection or investigation) which BANK suffers or incurs and which in ay case are directly or indirectly occasioned by or result from or are attributable to the violation of the Regulations.
- That the foregoing indemnity shall be in addition to any rights that BANK may have under the law or otherwise and in addition to any other liability which the Customer may have towards BANK.
IN WITNESS WHEREOF the parties have executed this Agreement on the date and year mentioned above.
- __________________
BANK
- _____________________
THE CUSTOMER
Witnesses:
- ____________________
- ____________________