Letter of Credit Clause Samples
A Letter of Credit clause outlines the requirement for payment to be made through a letter of credit, typically issued by a bank on behalf of the buyer to guarantee payment to the seller upon fulfillment of specified conditions. In practice, this means the seller will receive payment only after presenting documents, such as shipping receipts or invoices, that prove they have met the terms of the contract. This clause is commonly used in international trade to reduce the risk of non-payment and to provide assurance to both parties that payment will be made in accordance with agreed terms.
POPULAR SAMPLE Copied 1,031 times
Letter of Credit. The Security Deposit shall be in the form of an unconditional and irrevocable letter of credit (“Letter of Credit”) in a form and content reasonably satisfactory to Landlord, and issued by a national bank reasonably satisfactory to Landlord. The Letter of Credit shall either (i) expire on the date which is thirty (30) days after the Expiration Date (the “LC Date”) or (ii) be automatically self-renewing (i.e., an “evergreen” letter of credit), until Landlord shall be required to return the Letter of Credit to Tenant pursuant to the terms of this Lease. In the event the issuing national bank shall either fail to renew such an “evergreen” Letter of Credit at least thirty (30) days prior to the expiration date thereof, or at any time advise Landlord that it will no longer renew such Letter of Credit, a renewed or replacement Letter of Credit shall be delivered to Landlord no later than fifteen (15) days prior to the expiration of the Letter of Credit then held by Landlord, and in the event Landlord fails to timely receive the renewed or replacement Letter of Credit, Landlord shall have the right to immediately draw down the full amount of the Letter of Credit and hold the proceeds thereof as cash security in accordance with the provisions of this Article 3. If Default by Tenant shall occur under this Lease, Landlord may, but shall not be required to, from time to time, without prejudice to any other remedy, draw down on and use, apply or retain the whole or any part of the Letter of Credit for the payment of any Rent or any other sum then due and payable to Landlord under this Lease or then in default or to compensate Landlord for any other loss or damage which Landlord may suffer (to the extent permitted to be recovered by Landlord under this Lease) by reason of such Default by Tenant, including, without limitation, reasonable costs and reasonable attorneys’ fees incurred by Landlord to recover possession of the Premises (any such amount retained by Landlord (as opposed to then used or applied) shall be held as cash security in accordance with the provisions of this Article 3). In the event of a transfer of ▇▇▇▇▇▇▇▇’s interest in the Property, Landlord shall transfer the Letter of Credit to the transferee, and Tenant and the issuer shall thereafter be bound to the transferee Tenant Name: Alkami Technology Building Name: Granite Park Three under the terms of the Letter of Credit. This provision shall apply to every transfer or assignment made of the Letter of ...
Letter of Credit. (a) Upon the execution of this Lease, Tenant shall deliver to Landlord a standby, at sight, clean, irrevocable, non-documentary and unconditional Letter of Credit issued by and drawable upon a money-center bank (a bank which accepts deposits, maintains accounts, has a local San Francisco Bay Area office and which will negotiate a letter of credit) (hereinafter referred to as the “Issuing Bank”), and has combined capital, surplus and undivided profits of not less than FIVE HUNDRED MILLION AND NO/100 DOLLARS ($500,000,000.00), which Letter of Credit (i) shall name Landlord as beneficiary, (ii) be in the amount of SEVEN HUNDRED THOUSAND AND 00/100 DOLLARS ($700,000.00), (iii) have a term of not less than three (3) years, (iv) permit multiple drawings, (v) be fully transferable by Landlord without the payment of any fees or charges, (vi) require that any draw on the Letter of Credit be made only upon receipt by the issuing Bank of a written letter from landlord certifying that an Event of Default has occurred and is then continuing, and (vii) provide that it is governed by the uniform Customs and Practice for Documentary Credits (1993 revisions), and otherwise be in form and content reasonably satisfactory to Landlord. The Letter of Credit shall have a term expiration date or be renewed annually for a period of three (3) years from the Commencement Date. If upon any transfer, any fees or charges shall be so imposed, then such fees or charges shall be payable solely by Tenant and the Letter of Credit shall so specify. The Letter of Credit shall provide that it shall be deemed automatically renewed, without amendment, for consecutive periods of one (1) year each thereafter, unless the Issuing Bank sends notice (the “Non-Renewal Notice”) to Landlord by certified mail, return receipt requested, not less than forty-five (45) days next preceding the then expiration date of the Letter of Credit that it elects not to have such Letter of Credit renewed. Landlord shall have the right, after its receipt of the Non-Renewal Notice and until the expiration of the Letter of Credit to draw the full amount of the Letter of Credit, by sight draft on the Issuing Bank, and shall hold the proceeds of the Letter of Credit pursuant to the terms of this Paragraph 25.20 as cash security deposit.
(b) If an Event of Default in respect of any of the terms, covenants or conditions of this Lease, including the payment of rent, Landlord may apply or retain the whole or any part of the cash ...
Letter of Credit. Upon the execution and delivery of this Lease, Tenant shall deliver to Landlord as security for the performance of the obligations of Tenant hereunder, either a cash deposit or a letter of credit in the Security Deposit amount specified in Exhibit A in accordance with this Section (as renewed, replaced, increased and/or reduced pursuant to this Section, the “Letter of Credit”). If Tenant elects to deliver a Letter of Credit, such Letter of Credit shall be in such form as Landlord may reasonably approve. If there is more than one Letter of Credit so delivered by Tenant, such Letters of Credit shall be collectively hereinafter referred to as the “Letter of Credit”. The Letter of Credit (i) shall be irrevocable and shall be issued by a commercial bank reasonably acceptable to Landlord (Landlord acknowledging that Silicon Valley Bank is an acceptable bank), (ii) shall require only the presentation to the issuer of a certificate of the holder of the Letter of Credit stating either (a) that a default has occurred under this Lease after the expiration of any applicable notice and cure period (or stating that transmittal of a default notice is barred by applicable bankruptcy or other law if such is the case), or (b) stating that Tenant has not delivered to Landlord a new Letter of Credit having a commencement date immediately following the expiration of the existing Letter of Credit in accordance with the requirements of the Lease, (iii) shall be payable to Landlord and its successors in interest as the Landlord and shall be freely transferable without cost to any such successor or any lender holding a collateral assignment of Landlord’s interest in the Lease, (iv) shall be for an initial term of not less than one year and contain a provision that such term shall be automatically renewed for successive one-year periods unless the issuer shall, at least thirty (30) days prior to the scheduled expiration date, give Landlord written notice of such nonrenewal, and (v) shall otherwise be substantially in the form of the letter of credit attached hereto as Exhibit J. Notwithstanding the foregoing, the term of the Letter of Credit for the final period of the Term shall be for a term ending not earlier then the date forty-five (45) days after the last day of the Term. If Tenant shall be in default under the Lease, after the expiration of any applicable notice or cure period (or if transmittal of a default or other notice is stayed or barred by applicable bankruptcy or oth...
Letter of Credit. As a result of the addition of the Additional Premises to the Lease, the Four Million Two Hundred Ninety Nine Thousand Dollars ($4,299,000.00) Letter of Credit required under Paragraphs 2.d. and 6 of the Lease (as amended by the First Amendment) is hereby increased by One Million Seven Hundred Five Thousand One Hundred Eighty Dollars ($1,705,180.00) to the total sum of Six Million Four Thousand One Hundred Eighty Dollars ($6,004,180.00). Not later than thirty (30) days following the Third Amendment Effective Date, Tenant shall deliver to Landlord an amendment to the existing Letter of Credit held by Landlord that increases the amount of the Letter of Credit to the new increased amount, or, at Tenant’s option, Tenant may deliver an additional Letter of Credit to Landlord in the required additional amount, which additional Letter of Credit shall be in compliance in all respects with the requirements of Paragraph 6 of the Lease. Tenant’s failure to deliver the amendment to the Letter of Credit (or additional Letter of Credit) to Landlord on or before the date thirty (30) days after the Third Amendment Effective Date shall constitute an Event of Default under Paragraph 25.a. of the Lease and, in addition to the remedies afforded to Landlord under Paragraph 25.b. of the Lease, Landlord may, at Landlord’s option, terminate this Third Amendment by written notice to Tenant given at any time prior to receipt of the amended or additional Letter of Credit. Further, notwithstanding anything to the contrary in Paragraphs 2.b. or 2.e. above, Landlord shall not be required to commence Landlord’s Work or disburse any portion of Landlord’s Allowance until the amendment to the Letter of Credit or additional Letter of Credit is received in the required form and amount, and (i) any delays in Delivery caused by Tenant’s failure to timely deliver the same shall constitute a Tenant Caused Delivery Delay and (ii) any delays in Substantial Completion of the Tenant Improvements resulting from such failure shall constitute a Tenant Caused Substantial Completion Delay.
Letter of Credit. In lieu of providing a cash Security Deposit, simultaneously with the execution of this Lease, Tenant may deliver to Landlord an irrevocable and transferable letter of credit (“Letter of Credit”) running in favor of Landlord, with the Letter of Credit securing Tenant’s obligations hereunder subject to the terms and conditions set forth in the Lease. The terms of the Letter of Credit, which are subject to Landlord’s reasonable consent, shall strictly comply with the provisions of this Addendum #1. The Letter of Credit shall be issued by a bank acceptable to Landlord in Landlord’s reasonable discretion and under the supervision of the banking commission of the State of California or the Federal Deposit Insurance Corporation. If the credit of the bank that originally issues the Letter of Credit becomes unacceptable to Landlord in Landlord’s reasonable discretion, Tenant shall at its cost substitute another Letter of Credit from a bank that is acceptable to Landlord in Landlord’s sole reasonable discretion. The Letter of Credit shall be irrevocable for the period ending no less than one (1) year after the date of issuance. Tenant shall renew the Letter of Credit and maintain it for the period ending one hundred twenty (120) days after the end of the calendar year in which the Term expires, and shall provide that it is automatically renewable for the Term, unless released pursuant to the provisions of this Section or unless the issuing bank delivers a notice of non-renewal no later than thirty (30) days before expiration. If Tenant fails to renew the Letter of Credit within ten (10) Business Days of its expiration, Landlord may draw on the existing Letter of Credit and maintain the funds as a non-interest-bearing deposit to be returned to Tenant on receipt by Landlord of a substitute Letter of Credit from Tenant meeting all requirements of this Addendum #1. The form and terms of the Letter of Credit shall be reasonably acceptable to Landlord and shall provide, among other things, in effect that:
Letter of Credit any standby or documentary letter of credit issued by Issuing Bank for the account of a Borrower, or any indemnity, guarantee, exposure transmittal memorandum or similar form of credit support issued by Agent or Issuing Bank for the benefit of a Borrower.
Letter of Credit. 15.1 A Letter of Credit, drawn upon a chartered bank or credit union in favour of the Town in the format as outlined in Appendix 1, and in the amount referred to in Schedule “D”, shall be provided to the Town at the time of the execution of this Agreement, and shall be held by the Town as security for the obligations of the Owner pursuant to any of the provisions of this Agreement. If in the opinion of the Director of Operations, at any time and from time to time, such amounts are required to be increased, the Owner shall pay such additional sum or provide such additional security as may be required as a result of such increase. In determining the sufficiency of the amount, regard need not be had solely to the particulars outlined in Schedule “D”, but to the total cost of satisfying all of the obligations of the Owner pursuant to any of the provisions of the Agreement.
15.2 A Letter of Credit, as referred to in Schedule “D” shall be in a form acceptable to the Treasurer, a template of which is provided in Appendix 1, and shall contain the following provisions:
(a) The Letter of Credit shall be security for any obligations of the Owner pursuant to the provisions of this Agreement, without any limitations whatsoever;
(b) Drawings on the Letter of Credit shall be permitted upon presentation of a letter from the Town to the credit union or chartered bank claiming default by the Owner under the terms of this Agreement, and such default shall not be limited to the actions of the Owner;
(c) Partial drawings shall be permitted; and,
(d) If the Town has not determined the extent of the default or the amount required to rectify the default or compensate the Town or third parties as a result thereof, the Town may draw on the full amount of the Letter of Credit without any requirement to justify the amount of the Letter of Credit. If the Town is not provided with a renewal of the Letter of Credit at least thirty (30) days prior to its date of expiry, the Town may forthwith draw the full amount secured and hold it upon the same terms that applied to the Letter of Credit.
15.3 The Director of Operations shall not consider any application for reduction of any Letter of Credit unless and until all of the Primary Services required by this Agreement have been fully completed to the satisfaction of the Director of Operations and a Preliminary Certificate of Completion of Primary Services has been issued.
15.4 The Director of Operations may, at such yearly or other intervals ...
Letter of Credit. See Section 4.1.1.
Letter of Credit. Performance Assurance provided in the form of a Letter of Credit shall be subject to the following provisions:
(a) If Seller has provided a Letter of Credit pursuant to any of the applicable provisions in this Article Eight, then Seller shall renew or cause the renewal of each outstanding Letter of Credit on a timely basis in accordance with this Agreement.
(b) In the event the issuer of such Letter of Credit at any time (i) fails to maintain the requirements of an Eligible LC Bank or Letter of Credit, (ii) indicates its intent not to renew such Letter of Credit, or (iii) fails to honor Buyer’s properly documented request to draw on such Letter of Credit, Seller shall cure such occurrence by complying with either (A) or (B) below in an amount equal to the outstanding Letter of Credit, and by completing the action within five (5) Business Days after the date of Buyer’s Notice to Seller of an occurrence listed in this subsection (Seller’s compliance with either (A) or (B) below is considered the “Cure”):
(A) providing a substitute Letter of Credit that is issued by an Eligible LC Bank, other than the bank which is the subject of Buyer’s Notice to Seller in Section 8.5(b) above, or
(B) posting cash. If Seller fails to Cure or if such Letter of Credit expires or terminates without a full draw thereon by Buyer, or fails or ceases to be in full force and effect at any time that such Letter of Credit is required pursuant to the terms of this Agreement, then Seller shall have failed to meet the creditworthiness or collateral requirements of Article Eight.
(c) Notwithstanding the foregoing in Section 8.5(b), if, at any time, the issuer of such Letter of Credit has a Credit Rating on “credit watch” negative or developing by S&P, or is on ▇▇▇▇▇’▇ “watch list” under review for downgrade or uncertain ratings action (either a “Watch”), then Buyer may make a demand to Seller by Notice (“LC Notice”) to provide a substitute Letter of Credit that is issued by an Eligible LC Bank, other than the bank on a Watch (“Substitute Letter of Credit”). The Parties shall have thirty (30) Business Days from the LC Notice to negotiate a Substitute Letter of Credit (“Substitute Bank Period”).
(i) If the Parties do not agree to a Substitute Letter of Credit by the end of the Substitute Bank Period, then Buyer shall provide Seller with Notice within five (5) Business Days following the expiration of the Substitute Bank Period (“Ineligible LC Bank Notice Period”) that either:
(A) Buyer agre...
Letter of Credit. Any standby letter of credit issued at the request of the Borrower and for the account of the Borrower in accordance with §2.10.