DSR LC Facility Clause Samples
The DSR LC Facility clause establishes the terms under which a Documentary Standby Letter of Credit (DSR LC) facility is provided to a party, typically as a form of financial security or guarantee. This clause outlines the conditions for issuing, drawing upon, and repaying the facility, including eligibility requirements, documentation standards, and the obligations of both the issuing bank and the beneficiary. For example, it may specify the maximum credit amount available, the process for making a demand under the letter of credit, and the consequences of default. Its core practical function is to provide a reliable mechanism for securing payment or performance obligations, thereby reducing credit risk and enhancing trust between contracting parties.
DSR LC Facility. (a) The DSR Issuing Banks hereby establish for the account of the Borrower a non-participating letter of credit facility (the “DSR LC Facility”) having an initial aggregate committed amount set forth opposite the heading “DSR Facility Amount” on Appendix B (the “DSR Facility Amount”).
(b) Subject to and upon the terms and conditions set forth herein, each DSR Issuing Bank agrees to issue one or more irrevocable standby letters of credit (collectively, the “DSR Letters of Credit”) for the account of the Borrower and for the benefit of the Collateral Agent in accordance with the Accounts Agreement in the form set forth below the heading identifying such DSR Letters of Credit on Appendix D.
(c) Each DSR Letter of Credit shall expire on the date set forth therein, which shall be determined in accordance with Section 3.25 and Appendix D and shall not in any event be later than the last day of the DSR Availability Period.
(d) Any LC Loans resulting from drawings under the DSR Letters of Credit shall mature and be immediately payable on the last day of the DSR Availability Period (or, if the Term Conversion Date does not occur on or prior to the Date Certain, the Date Certain) (the “DSR Maturity Date”).
DSR LC Facility. (a) The DSR Issuing Banks hereby establish for the account of the Borrower a non-participating letter of credit facility (the “DSR LC Facility”) having an initial aggregate committed amount set forth opposite the heading “DSR Facility Amount” on Appendix B (the “DSR Facility Amount”).
(b) Subject to and upon the terms and conditions set forth herein, each DSR Issuing Bank agrees to issue one or more irrevocable standby letters of credit (collectively, the “DSR Letters of Credit”) for the account of the Borrower and for the benefit of the Collateral Agent in accordance with the Accounts Agreement in the form set forth below the heading identifying such DSR Letters of Credit on Appendix D.
(c) Each DSR Letter of Credit shall expire on the date set forth therein, which shall be determined in accordance with Section