Common use of Letter of Credit Option Clause in Contracts

Letter of Credit Option. If El Paso determines in its reasonable business judgment that it is necessary to delay the issuance of debt securities to fund all or a portion of the $243,229,464 second payment beyond the required deposit date of such second payment, then El Paso may, in lieu of the deposit of such second payment, deliver a Letter of Credit in favor of the Settlement Fund or its assignees that shall entitle the beneficiary to draw the amount of $243,229,464, plus interest thereon at the rate then applicable to 3- month U.S. Treasury bills, if (i) the second payment funds have not been deposited in the Escrow Account on the Business Day immediately preceding the Effective Date, or (ii) such Letter of Credit will expire in thirty (30) days or less, and the El Paso Settling Parties have not replaced such expiring Letter of Credit with another Letter of Credit in the same amount and on the same terms. Such Letter of Credit shall be surrendered upon the deposit of the second payment together with interest thereon at the rate then applicable to 3- month U.S. Treasury bills from that date which is one hundred eighty (180) days after the date on which this Agreement is executed through and including the date on which the second payment funds are deposited in the Escrow Account.

Letter of Credit Option. If El Paso determines in its reasonable business judgment that it is necessary to delay the issuance of debt securities to fund all or a portion of the $243,229,464 second payment beyond the required deposit date of such second payment, then El Paso may, in lieu of the deposit of such second payment, deliver a Letter of Credit in favor of the Settlement Fund or its assignees that shall entitle the beneficiary to draw the amount of $243,229,464, plus interest thereon at the rate then applicable to 3- 3-month U.S. Treasury bills, if if (i) the second payment funds have not been deposited in the Escrow Account on the Business Day immediately preceding the Effective Date, or (ii) such Letter of Credit will expire in thirty (30) days or less, and the El Paso Settling Parties have not replaced such expiring Letter of Credit with another Letter of Credit in the same amount and on the same terms. Such Letter of Credit shall be surrendered upon the deposit of the second payment together with interest thereon at the rate then applicable to 3- 3-month U.S. Treasury bills from that date which is one hundred eighty (180) days after the date on which this Agreement is executed through and including the date on which the second payment funds are deposited in the Escrow Account.