the Depositor’s liability hereunder shall be held in trust for the Bank and as security for the Depositor’s liability hereunder.
Should the Customer become bankrupt or being a corporation be wound up the Bank may (notwithstanding payment to the Bank by the Depositor or any other person of any moneys hereby guaranteed) rank as creditor and prove in the bankruptcy or winding up of the Customer for the whole amount then outstanding against the Customer and the Bank may and shall be entitled to receive and retain the whole of the dividends in respect of such amount to the exclusion of all the Depositor’s rights as guarantor and no money or dividend so received by the Bank shall be treated as received in respect of this Letter of Set-Off and Guarantee or otherwise in relation to the Depositor but the full amount hereby guaranteed shall be payable by the Depositor until the Bank shall have received from all sources one hundred cents in the dollar on the ultimate balance outstanding against the Customer.
Any amounts which the Customer now or hereafter owes to the Depositor are hereby subordinated to the amounts owed hereunder to the Bank. Until all moneys due or owing by the Customer to the Bank hereunder shall have been fully paid and all the Customer’s liabilities to the Bank shall have been satisfied and discharged the Depositor shall not:-
in respect of any moneys which may have been paid hereunder by the Depositor, seek to enforce repayment or to exercise any other rights or legal remedies of whatsoever kind which may accrue howsoever to the Depositor in respect of the amount so paid;
prove in competition with the Bank for any moneys owing by the Customer to the Depositor on any account whatsoever and/or in respect of any moneys due or owing from the Customer to the Bank but will give to the Bank the benefit of any proof which the Depositor may be able to make in the liquidation or bankruptcy of the Customer or in any arrangement or composition with creditors; or
take any steps to enforce any rights against the Customer or receive or claim or have the benefit of any payment or distribution from or on account of the Customer or exercise any right of set-off or counterclaim against the Customer provided always that on making a claim against the Depositor pursuant hereto the Bank may at its sole discretion instruct the Depositor to take any steps referred to in this sub-paragraph and any moneys or other benefit thereby obtained by the Depositor will thereafter be held by the Depositor in trust for the Bank.
If any moneys shall become payable by the Depositor hereunder, the Depositor shall not so long as the same remains unpaid exercise in respect of any amount previously paid by it hereunder any right or subrogation or any other right or remedy which the Depositor may have in respect thereof.
The Depositor’s payment obligation hereunder shall be in the currency in which the aforesaid credit facilities or other accommodation are accorded or granted by the Bank to the Customer (Stipulated Currency) and shall not be discharged by an amount paid in a currency other than the Stipulated Currency, whether pursuant to a judgment or otherwise, to the extent that the amount so paid on prompt conversion to the Stipulated Currency under normal banking procedures does not yield the full amount of such obligation in the Stipulated Currency. If the amount due or owing under the judgment or otherwise upon conversion does not yield such amount in the Stipulated Currency, the Bank shall have recourse against the Depositor for the Stipulated Currency deficiency provided
OCBC Legal / Sep 2009