Currency Settlement Clause Samples
The Currency Settlement clause defines the procedures and requirements for completing payments or financial transactions in a specified currency. It typically outlines which currency will be used for settlement, the method of conversion if multiple currencies are involved, and the timing or location of payment. For example, it may require that all payments be made in U.S. dollars, or specify how exchange rates are determined if a different currency is used. This clause ensures clarity and reduces disputes by establishing clear rules for how and in what currency financial obligations are fulfilled.
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Currency Settlement. To the extent that, at any time, as a result of a fluctuation in currency exchange rates or otherwise, the aggregate amount of all Letters of Credit denominated in Canadian Dollars issued by the L/C Issuer to the Borrowers equals or exceeds an amount in US Dollars equal to 105% of the Maximum Aggregate Loan Amount as determined by Administrative Agent in its sole discretion, absent manifest error, Administrative Agent shall provide written notice of same to the Representative. Upon receipt of such notice from Administrative Agent, the Borrowers shall deliver to Administrative Agent either an amount of US Dollars or a letter of credit (or similar instrument) in form and substance satisfactory to Administrative Agent in its sole discretion and issued by an issuer satisfactory to Administrative Agent in its sole discretion, in each case in an amount equal to the amount by which the Maximum Aggregate Loan Amount has been exceeded, which amount of US Dollars or letter of credit (or similar instrument), as applicable, shall be held by Administrative Agent as collateral security to secure payment of the amounts payable under such Letters of Credit denominated in Canadian Dollars in respect of any drawings thereunder. To the extent that, at any time, as a result of a further fluctuation in currency exchange rates or otherwise, the aggregate amount of all Letters of Credit denominated in Canadian Dollars issued by the L/C Issuers to the Borrowers subsequently decreases to an amount equal to or less than the Maximum Aggregate Loan Amount as determined by Administrative Agent in its sole discretion, absent manifest error, Administrative Agent shall return to the Borrowers any amount of US Dollars or letter of credit (or similar instrument), as applicable, held by Administrative Agent as collateral security in respect of such Letters of Credit denominated in Canadian Dollars.