Fronted LC Provisions Sample Clauses
The Fronted LC Provisions clause defines the terms and conditions under which a fronting bank issues a letter of credit (LC) on behalf of a borrower, typically for the benefit of a third party. In practice, this clause outlines the responsibilities of the fronting bank, the process for reimbursement by the borrower or other participating lenders, and the allocation of risk if the LC is drawn upon. For example, it may specify how claims under the LC are handled and how participating lenders share in the obligations. The core function of this clause is to facilitate the issuance of LCs when the primary lender cannot do so directly, ensuring that beneficiaries receive the required credit support while clearly allocating responsibilities and risks among the parties involved.
Fronted LC Provisions. (1) Each Fronting Lender will exercise and give the same care and attention to each Fronted LC issued by it hereunder as it gives to its other letters of credit and similar obligations, and such Fronting Lender’s, sole liability to each relevant Lender shall be to promptly return to the Agent for the account of the relevant Lenders, each such Lender’s respective Rateable Portions of any payments made to such Fronting Lender, by the applicable Borrower hereunder (other than the fees and amounts payable to such Fronting Lender for its own account) if such Borrower has made a payment to such Fronting Lender hereunder. Each Lender agrees that, in paying any drawing under a Fronted LC, the applicable Fronting Lender shall not have any responsibility to obtain any document (other than as expressly required by such Fronted LC) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of any Person delivering any such document. None of the applicable Fronting Lender or any of their representatives, officers, employees or agents shall be liable to any Lender for:
(a) any action taken or omitted to be taken in connection herewith at the request or with the approval of the Lenders;
(b) any action taken or omitted to be taken in connection with any Fronted LC in the absence of gross negligence or wilful misconduct; or
(c) the execution, effectiveness, genuineness, validity, or enforceability of any Fronted LC, or any other document contemplated thereby. None of any of the Fronting Lenders shall incur any liability by acting in reliance upon any notice, consent, certificate, statement or other writing (which may be a bank wire, electronic mail transmittal or similar writing) believed by it to be genuine or to be signed by the proper Person or Persons.
(2) Each Borrower and each Lender hereby authorize each applicable Fronting Lender to review on behalf of each Lender each draft and other document presented under each Fronted LC. The determination of the applicable Fronting Lender as to the conformity of any documents presented under a Fronted LC to the requirements of such Fronted LC shall, in the absence of such Fronting Lender’s gross negligence or wilful misconduct (as determined by a final non-appealable judgment of a court of competent jurisdiction), be conclusive and binding on the applicable Borrower and each applicable Lender. Such applicable Fronting Lender or the U.S. Fronting Lender, as the case may be, shall, within a r...
Fronted LC Provisions. (1) The Fronting Lender will exercise and give the same care and attention to each Fronted LC issued by it hereunder as it gives to its other letters of credit and similar obligations, and the Fronting Lender’s sole liability to each Lender shall be to promptly return to the Agent for the account of the Lenders, each Lender’s Rateable Portion of any payments made to the Fronting Lender by the Borrower hereunder (other than the fees and amounts payable to the Fronting Lender for its own account) if the Borrower has made a payment to the Fronting Lender hereunder. Each Lender agrees that, in paying any drawing under a Fronted LC, the Fronting Lender shall not have any responsibility to obtain any document (other than as expressly required by such Fronted LC) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of any person delivering any such document. Neither the Fronting Lender nor any of its representatives, officers, employees or agents shall be liable to any Lender for: