Sample Letter Of Credit - Automatic Extension
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1SAMPLE – LETTER OF CREDIT
AUTOMATIC EXTENSION
LETTERHEAD OF BANK OR OTHER FINANCIAL INSTITUTION
ADDRESS OF FINANCIAL INSTITUTION
DATE
TO:
THE CORPORATION OF THE TOWN OF CALEDON
6311 OLD CHURCH ROAD
CALEDON EAST, ONTARIO
L7C 1J6
ATTENTION: TREASURER
Dear Madam/Sir:
RE:
Irrevocable Standby Letter of Credit No. ___________________________
We hereby authorize you to draw on (Name and Address of Bank), for the account of (Customers Name
and Address), up to an aggregate amount of $_____
_______ available on demand.
Pursuant to the request of (Name of Customer), we (Name of Bank), hereby establish and give to you an
Irrevocable Standby Letter of Credit in your favour in the total amount of $
, which may be
drawn on by you at any time and from time to time upon written demand for payment made upon us by you
which demand we shall honour without inquiring whether you have a right as between yourself and our said
customer to make such demand, and without recognizing any claim of our said customer.
Provided, however, that you are to deliver to us at such time as a written demand for payment is made upon
us, a certificate confirming that monies drawn pursuant to this Irrevocable Standby Letter of Credit are to be
retained and used by you to satisfy the obligation of (Name of Customer) to pay the Green Development
Charge Discount to you with respect to the building that (Name of Customer) has constructed on Lot
_____
, Concession
_____
____ or Registered Plan
________________, being _____address
____________, in the Town of Caledon, Regional Municipality of Peel.
The amount of this Irrevocable Standby Letter of Credit shall be reduced from time to time as advised by
notice in writing given to us from time to time by you.
This Irrevocable Standby Letter of Credit will expire at our counters (Name of Bank) on (expiry date).
It is a condition of this Irrevocable Standby Letter of Credit that it shall be deemed to be automatically
extended for one year from the present or any future expiration date hereof, unless thirty days prior to any
such date we shall notify you in writing by Registered Mail that we elect not to consider this Irrevocable
Standby Letter of Credit renewed for any such additional period. Upon receipt by you of such notice, you
may draw hereunder by means of your demand accompanied by your written certification that the amounts
drawn will be retained and used by you to satisfy the above obligation; further, that you will release any
amounts not required by you to (Name of Customer).
Partial drawings are permitted.
The drawings under this Irrevocable Standby Letter of Credit are to state on their face that they are drawn
under (Name and Address of Bank), Irrevocable Standby Letter of Credit No.
____
dated
.
We hereby agree that drawings under this Irrevocable Standby Letter of Credit will be duly honoured upon
presentation provided that all terms and conditions of the Credit have been complied with.
NAME OF BANK OR FINANCIAL INSTITUTION
Per:
Per:
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Parent category: Letters