Exhibit
10.31


 


GUARANTY


 


THIS GUARANTY (this “Guaranty”), effective as
of March 9, 2000, is executed and delivered by ACE Capital Re International
Ltd., an insurance company registered and licensed under the laws of the
Islands of Bermuda (“Parent”), for the benefit of ACE Capital Re Bermuda Ltd.,
an insurance company registered and licensed under the laws of the Islands of
Bermuda (“Subsidiary”).


 


W I T N E S S E T H


 


WHEREAS, the Parent is the parent of the
Subsidiary;


 


WHEREAS, to further support the claims paying
resources of Subsidiary, Parent has agreed to guaranty the payment obligations
of Subsidiary; and


 


WHEREAS, the corporate interests of Parent
will be benefited by entering into this guaranty.


 


NOW, THEREFORE, in consideration of the
foregoing and for other valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:


 


Section 1. 
Guaranty.  Parent
unconditionally and irrevocably guarantees to Subsidiary that during the term
of this Guaranty it will, on demand by Subsidiary, make funds available to
Subsidiary for the full and complete payment when due of all payment
obligations of Subsidiary (the “Guaranteed Obligations”) to the extent
Subsidiary is unable to satisfy those obligations.


 


This Guaranty is issued by Parent for the
benefit of the holders of the Guaranteed Obligations (the “Holders”) and the
Holders are hereby made third-party beneficiaries and may directly claim upon
and enforce the obligations of Parent hereunder as provided herein.


 


Section 2. 
Obligation Unconditional. 
The obligations of Parent under this Guaranty are irrevocable and
unconditional to the fullest extent permitted by applicable law, irrespective
of any other circumstance whatsoever which might otherwise constitute a legal
or equitable discharge of a surety or guarantor, including fraud in the
inducement or fact; the intent of this Guaranty being that the obligations of
Parent hereunder shall be absolute and unconditional under all circumstances
and shall not be discharged except by payment as provided for herein. Parent
hereby expressly waives diligence, presentment, notice of acceptance and any
requirement that Subsidiary exhaust any right, remedy or proceed against any
obligor.


 


Section 3. 
Preferential Payments.  The
guaranty provided under Section 1 shall include the full and complete payment
of the amount of any claim on any Guaranteed Obligation paid by Subsidiary
which is subsequently voided in whole or in part as a preferential


 

















 


payment under
applicable law, including proceedings in bankruptcy, insolvency, reorganization
or other similar laws affecting creditor’s rights generally.


 


Section 4. 
Subrogation.  Parent
hereby unconditionally agrees that until the payment and satisfaction in full
of all payments guaranteed hereby, it shall not exercise any right or remedy
arising by reason of any performance by it of this Guaranty, whether by
subrogation or otherwise, against Subsidiary.


 


Section 5. 
No Waiver.  No failure on
the part of Subsidiary to exercise, no delay in exercising, and no course of
dealing with respect to, any right or remedy hereunder will operate as a waiver
thereof, nor will any single or partial exercise of any right or remedy
hereunder preclude any other further exercise thereof or the exercise of any
other right or remedy.


 


Section 6.  Continuing
Effect; Assignment.  This Guaranty
is a continuing guarantee that: (i) shall be binding upon Parent, its
successors and assigns, and (ii) shall inure to the benefit of, and be
enforceable by, the Holders, their successors and assigns, to the extent of
claims on Guaranteed Obligations which are not satisfied by Subsidiary.


 


Section 7.  Amendment,
Modification or Termination.  This
Guaranty may not be amended, modified or terminated except upon six (6) month
prior notice, in writing, given by Parent to Subsidiary, with a copy of such
notice simultaneously delivered to Standard & Poor’s Corporation and Duff & Phelps Credit Rating Co., and
provided further that such proposed amendment, modification or termination
shall only become effective if both the financial strength rating assigned to
Subsidiary by Standard & Poor’s Corporation and the claims paying ability
rating assigned to Subsidiary by Duff & Phelps Credit Rating Co, after such
termination, amendment or modification is not lower than such rating assigned
immediately prior to the proposed amendment, modification or termination.


 


Section 8. 
Governing Law.  This
Guaranty shall be governed by and construed in accordance with the laws of the
State of New York.


 


IN WITNESS WHEREOF, Parent has duly executed
and delivered this Guaranty as of the day and year first above written.


 


ACE CAPITAL RE INTERNATIONAL LTD.


 


 


	
  By:

  	
  [ILLEGIBLE]

  	
   

  	
   

  
	
  Title:

  	
  Director