Letter Of Credit Reimbursement Agreement Template for Ireland

The Letter of Credit Reimbursement Agreement is a fundamental document in international trade finance, used when a bank issues Letters of Credit (LCs) on behalf of its customer. This agreement, governed by Irish law, establishes the legal framework for the customer's obligation to reimburse the bank for any payments made under such LCs. It is typically required when a company engages in international trade transactions requiring Letters of Credit, particularly in import/export operations. The agreement covers crucial aspects such as payment terms, security arrangements, events of default, and remedies, while ensuring compliance with Irish banking regulations and international banking practices. It provides essential protection for the issuing bank while offering clarity to the applicant regarding their reimbursement obligations and the consequences of default.

1. Parties: Identification of the Applicant (reimbursing party), the Issuing Bank, and any other relevant parties

2. Background: Context of the agreement, reference to the underlying Letter of Credit arrangement

3. Definitions and Interpretation: Definitions of key terms, interpretation rules, and reference to UCP 600

4. Reimbursement Obligation: Core obligation to reimburse the bank for LC payments, including timing and method

5. Payment Terms: Detailed mechanics of how and when payments must be made, currency provisions

6. Fees and Charges: Bank's fees, charges, and commission structure for LC services

7. Representations and Warranties: Standard and LC-specific representations by the Applicant

8. Covenants: Ongoing obligations of the Applicant during the life of the agreement

9. Events of Default: Circumstances constituting default and consequences

10. Indemnification: Applicant's obligation to indemnify the bank for losses related to the LC

11. Communications: Methods and requirements for notices and other communications

12. Assignment and Transfer: Restrictions on transfer of rights and obligations

13. Governing Law and Jurisdiction: Choice of Irish law and jurisdiction provisions

14. General Provisions: Standard boilerplate clauses including severability, entire agreement, etc.