{"component": "clause", "props": {"groups": [{"size": 2, "snippet": "The City agrees to pay to the Bank, for any drawing under the Letter of Credit, a drawing fee (the \u201cDraw Fee\u201d) in the amount of $250 payable without any requirement of notice, invoice or demand by the Bank on the date of such Drawing.", "samples": [{"hash": "8DAjAcekPuj", "uri": "/contracts/8DAjAcekPuj#draw-fees", "label": "Letter of Credit Reimbursement Agreement", "score": 24.1704311371, "published": true}], "snippet_links": [{"key": "to-the-bank", "type": "clause", "offset": [23, 34]}, {"key": "the-letter-of-credit", "type": "clause", "offset": [58, 78]}, {"key": "drawing-fee", "type": "definition", "offset": [82, 93]}, {"key": "draw-fee", "type": "clause", "offset": [100, 108]}, {"key": "requirement-of-notice", "type": "clause", "offset": [153, 174]}, {"key": "by-the-bank", "type": "clause", "offset": [194, 205]}, {"key": "date-of", "type": "clause", "offset": [213, 220]}], "hash": 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"What are the most common legal pitfalls or fatal flaws in Draw Fees provisions?", "How do Draw Fees clauses compare across different jurisdictions or standard industry practices?", "What factors most influence a court\u2019s decision to enforce or strike down a Draw Fees clause?"], "drafting_tip": "Specify the fee calculation method to prevent disputes, state payment timelines to ensure timely collection, and define consequences for non-payment to encourage compliance.", "explanation": "The Draw Fees clause establishes the requirement for a borrower to pay a fee each time they access or \"draw\" funds from a credit facility or loan. Typically, this fee is calculated as a percentage of the amount drawn and is charged at the time of each disbursement, rather than on the total facility amount. By implementing draw fees, lenders are compensated for the administrative costs and risks associated with each disbursement, and it discourages borrowers from making frequent, small withdrawals, thereby streamlining the loan management process."}, "json": true, "cursor": ""}}