Letter of Credit. Within forty-five (45) days after the mutual execution and delivery of this Lease, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 2 contracts

Samples: Office Lease (Blackline, Inc.), Office Lease (Blackline, Inc.)

Letter of Credit. Within ~~forty-five~~ twenty one (4521) days after the ~~mutual execution and delivery of~~ date that this ~~Lease~~Lease is fully executed, Tenant shall deliver to Landlord, as ~~collateral~~ protection for the full and faithful performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer (or that Landlord reasonably estimates it may suffer) as a result of any breach, default or failure to perform by Tenant under this Lease, an irrevocable and unconditional negotiable ~~letter~~ standby Letter of ~~credit~~ Credit (~~the~~ “Letter of Credit”), ~~substantially~~ in the form ~~attached~~ as ~~Exhibit G hereto and made a part hereof, and containing the terms required herein~~is acceptable to Landlord, payable at an office in the ~~State of~~ San Francisco Bay Area, California, running in favor of ~~Landlord,~~ Landlord and issued by a ~~solvent~~ solvent, nationally recognized bank ~~reasonably approved by Landlord~~ with a long term rating of BBB or higher, under the supervision of the Superintendent of Banks of the State of California, or a ~~National Banking Association~~national banking association (an “Acceptable Issuing Bank”), in the ~~initial~~ amount of ~~$[***]~~ Security Deposit (the “LC Letter of Credit Amount”). Tenant shall ~~provide~~ pay all expenses, points, or fees incurred by Tenant in obtaining the Letter of Credit and any replacement Letter of Credit. The bank issuing the Letter of Credit (the “Bank”) shall be subject to Landlord’s prior written approval, which approval shall not be withheld by Landlord ~~with~~ if the proposed Bank is an Acceptable Issuing Bank. If an Acceptable Issuing Bank is declared insolvent or taken over by the Federal Deposit Insurance Corporation or any governmental agency for any reason or does not meet the standards to be approved an Acceptable Issuing Bank, Tenant shall deliver a ~~specimen~~ replacement Letter of Credit from another Bank approved by Landlord that meets the ~~approved issuer prior to~~ standards for an Acceptable Issuing Bank within the ~~execution~~ earlier of ~~this Lease~~(i) thirty (30) days after notice from Landlord that the Bank does not meet the standard for an Acceptable Issuing Bank, or (ii) the date the Bank is declared insolvent or taken over for any reason by the Federal Deposit Insurance Corporation or any other governmental agency. ~~The~~ In addition, the Letter of Credit shall beexpressly provide for the following: (a1) shall be “callable” at ~~sight~~ sight, irrevocable, and ~~irrevocable~~unconditional; (b2) shall be maintained in ~~effect~~ effect, whether through renewal or extension, for the ~~entire~~ period from the date of ~~execution of~~ this Lease ~~through~~ and continuing until the date ~~which is sixty~~ (~~60) days following~~ the ~~Termination Date (~~“Letter of Credit Expiration Date”) that is one hundred twenty (120) days after the expiration of the Term (as the Term may be extended). The Letter of Credit may be for one year period, ~~subject~~ provided the Letter of Credit is automatically extended for not less than a one year period unless the issuing Bank provides written notice to Landlord not less than sixty (60) days prior to the ~~last paragraph of this Article 27, provide that the~~ then expiration date of the Letter of Credit ~~shall be no earlier than~~ that the issuing Bank will not renew or extend the Letter of ~~Credit Termination Date or provide for automatic renewal thereof at least through the~~ Credit, in which case Tenant shall deliver to Landlord a replacement Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least not less than thirty (30) days prior to the scheduled expiration date of the then existing Letter of Credit held by Landlord without any action whatsoever on the part of Landlord; (c3) shall be fully assignable by Landlord, its successors, and assignees of its interest in the Leased Premises; (4) shall permit partial draws and multiple presentations and drawings; and (5) shall be otherwise subject to the Uniform Customs and Practices for Documentary ~~Credits (1993-Rev)~~ Credits, International Chamber of Commerce Publication ~~#600; and~~ No. 600 (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnershipUCP600), or ~~any authorized party~~ the International Standby Practices-ISP 98, International Chamber of Commerce Publication No. 590 (~~if another entity~~1998); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 2 contracts

Samples: Office Lease, Office Lease (Puma Biotechnology, Inc.)

Letter of Credit. Within ~~forty-five~~ ten (4510) days after the ~~mutual~~ date of execution ~~and delivery~~ of this Lease, Tenant shall ~~deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease,~~ provide Landlord with an irrevocable and unconditional ~~negotiable~~ letter of credit (~~the~~ “Letter of Credit”~~), substantially~~ ) in the ~~form attached as Exhibit G hereto~~ amount of Three Hundred and ~~made a part hereof,~~ Fifty Thousand and ~~containing the terms required herein, payable in the State of California, running in favor of Landlord~~No/100 Dollars ($350,000.00), issued by a ~~solvent~~ California bank ~~reasonably~~ previously approved by Landlord ~~under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association,~~ and substantially identical in ~~the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior~~ form to the ~~execution~~ sample letter of ~~this Lease~~credit attached as Exhibit “F” as the Security Deposit. The Letter of Credit shall ~~be: (a) at sight~~ be irrevocable, unconditional and ~~irrevocable; (b) maintained in effect for~~ payable upon demand upon presentation of Landlord’s draft, accompanied by the ~~entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“~~original Letter of Credit ~~Expiration Date”)~~together with a notarized statement, ~~subject~~ signed by an authorized officer of Landlord, stating that Landlord has a right to ~~the last paragraph of this Article 27, provide that the expiration date of~~ draw upon the Letter of ~~Credit~~ Credit. Partial drawings shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to permitted. Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw ~~down an amount up to the face amount of~~ on the Letter of Credit ~~upon~~ in the ~~presentation to the issuing bank of Landlord’s~~ event that (~~or Landlord’s then managing agent’s~~a) ~~written statement that Landlord~~ Tenant is ~~entitled to make such drawing~~ in default under this ~~Lease, it being understood that if Landlord~~ Lease after expiration of any grace period; or ~~its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer~~ (~~if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii~~b) Tenant fails to renew the Letter of Credit ~~will be honored by the issuing bank without inquiry~~ as least one (1) month prior to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said its expiration date. The Letter of Credit ~~to a new landlord~~shall have an initial term of not less than twelve (12) months and shall be renewable for successive twelve month periods. If, ~~as a result~~ upon the Date of ~~any application or use~~ Commencement, the final Tenant Improvements Cost paid by Landlord ~~of all or any part of the Letter of Credit~~is less than Seven Hundred Thousand Dollars ($700,000.00), then the amount of the Letter of Credit may be reduced to an amount equal to one-half (1/2) of the final Tenant Improvement Cost paid by Landlord. The amount of the Letter of Credit (the lesser of Three Hundred Fifty Thousand Dollars ($350,000.00) or one-half (1/2) of the final Tenant Improvements Cost paid by Landlord) may be reduced by the following amounts on the following dates or events: (a) On each anniversary of the Commencement Date of each Lease Year the Letter of Credit shall be reduced by twenty percent (20%) on a straight-line basis so that the Letter of Credit will be totally diminished by the fifth (5th) anniversary of the Commencement Date (“Annual Reductions”); and (b) The Letter of Credit shall be reduced by twenty percent (20%) as each of the following events occur (each, an “Event Reduction”): 1. A private placement of Tenant’s Capital Stock of $5,000,000 or more; 2. an initial public offering (IPO) of Tenant’s Common Stock with aggregate net proceeds of $10,000,000 or more; 3. a corporate partnering transaction or joint venture of $5,000,000 or more which may consist of, but is not limited to, license payments, cost sharing payments, milestone payments or equity investment; 4. the Tenant achieves product sales, excluding any contract revenues or licensing fees, of at least $1,000,000; and 5. the Tenant achieves revenues (determined in accordance with generally accepted accounting principles) from product sales, excluding any contract revenues and licensing fees, equal to or greater than its expenses in any two consecutive fiscal quarters (pretax). Notwithstanding anything to the contrary in this Section 3.4.2, the Letter of Credit shall at all times be maintained in an amount at least equal to the Basic Monthly Rent for the Phase I Premises. If an Annual Reduction or Event Reduction would otherwise result in a reduction of the Letter of Credit to an amount which is less than the ~~LC Amount~~amount equal to the Basic Monthly Rent for the Phase I Premises, ~~Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s)~~ then the Letter of ~~credit, in~~ Credit shall be reduced only to an amount equal to the ~~deficiency~~ Basic Monthly Rent for the Phase I Premises. (or c) If the above Event Reductions are achieved at any time during a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentenceLease Year, the ~~same~~ Annual Reduction that would otherwise occur in such Lease Year shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretionoccur. However, if ~~the Letter of Credit is~~ an Event Reduction does not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral occur in a ~~deposit account in~~ Lease Year, then the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there Annual Reduction shall occur ~~a default under the~~ in such Lease ~~beyond all applicable notice and cure periods~~Year. However, ~~Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part~~ two or ~~in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which~~ more Event Reductions may ~~be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere~~ occur in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950Year.

Appears in 2 contracts

Samples: Lease Agreement, Industrial Real Estate Triple Net Lease (Pacira Pharmaceuticals, Inc.)

Appears in 1 contract

Samples: Ground Lease

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after the mutual execution and delivery of this Lease,~~ Tenant ~~shall~~ must deliver to ~~Landlord,~~ Landlord an irrevocable standby Letter of Credit in the amount of $50,000.00 (the "Letter of Credit") upon the Final Lease Date. Landlord will hold the Letter of Credit as ~~collateral~~ security for the ~~full and faithful~~ performance by Tenant of ~~all of its~~ Tenant's covenants and obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit ~~shall be:~~is not to be considered an advance payment of Rent or a measure for Tenant's liability for damages in case of a default by Tenant. Landlord may, from time to time, without prejudice to any other remedy, draw upon the Letter of Credit to the extent necessary to make good any arrearages of Rent or to satisfy any other covenant or obligation of Tenant hereunder. The Letter of Credit must (ai) ~~at sight~~ be in a form acceptable to Landlord; (ii) be written by a bank or other financial institution acceptable to Landlord, and ~~irrevocable;~~(iii) permit Landlord to unconditionally draw upon the Letter of Credit by presentationof the Letter of Credit accompanied only by 1 of the following written statements: (A) "We hereby draw under your Letter of Credit number __________________________for USD_______________________as Oxysure Systems, Inc. (the Tenant) is in default under the Lease Agreement dated February_______________________ , 2007, between Sinacola Commercial Properties, Ltd. (the Landlord) and Oxysure Systems, Inc."; (B) "We hereby draw under your Letter of Credit number___________________for USD ____________________as this Letter of Credit is scheduled to expire within 30 days and Sinacola Commercial Properties, Ltd. (the Landlord) has not received a renewal or replacement of this Letter of Credit and the term of the Lease Agreement has not expired, or (C) (C) Oxysure Systems, Inc. (as Tenant) has exercised its early termination option pursuant to Section 13.21 of the Lease Agreement dated February ______________________ , 2007 between Sinacola Commercial Properties, Ltd. (as Landlord) and Oxysure Systems, Inc." (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date The initial term of the Letter of Credit ~~shall~~ must be ~~no earlier~~ for the entire Lease Term. Not later than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) 30 days prior to the expiration of the Letter of ~~Credit without any action whatsoever on~~ Credit, Tenant must renew the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms term of the Letter of Credit to meet the requirements set forth herein. Failure to so renew the Letter of Credit and deliver the renewed Letter of Credit to Landlord will enable Landlord to immediately draw upon the existing Letter of Credit. If Landlord ever draws upon the Letter of Credit (~~and~~ except in the ~~bank issuing~~ case of failure to renew the ~~same) shall be acceptable to Landlord, in Landlord’s reasonable discretion~~Letter of Credit), and ~~shall provide~~if this Lease has not terminated, ~~among other things, in effect that: (i) Landlord,~~ Tenant must immediately deliver to Landlord either cash or ~~its then managing agent, shall have~~ an endorsement of the ~~right to draw down an amount up to the face amount~~ issuer of the Letter of Credit ~~upon~~ reinstating the ~~presentation to~~ credit for the ~~issuing bank of~~ portion thereof used by Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or ~~any authorized party (if another entity); (ii) the~~ an additional Letter of Credit ~~will be honored by the issuing bank without inquiry as~~ conforming to the ~~accuracy thereof and regardless~~ requirements of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of creditthis Section 5.4, in an amount equal to the ~~deficiency (or a replacement letter of credit in the total amount~~ reduced portion of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the original Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to used by Landlord~~, as applicable,~~ . Tenant must not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain encumber the Letter of Credit in any manner, and Landlord will not be bound by any purported encumbrance. (c) If Landlord transfers its interest in the ~~amount and in accordance with~~ Complex during the ~~terms set forth in this Article 27~~Lease Term, Landlord shall ~~have the right to present~~ transfer all or any portion of the Letter of Credit to the ~~issuing bank in accordance with~~ transferee (and Tenant will take such actions as are necessary to cause the ~~terms~~ Letter of ~~this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”)~~ Credit to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account issued in the name of ~~Landlord and commingle the Cash Collateral with its general assets and~~ such transferee). Upon such transfer Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, must thereafter look only to the ~~extent necessary to cure any default of Tenant and/or to compensate Landlord~~ new landlord for ~~any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by~~ the ~~express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds~~ return of the Letter of Credit, ~~either prior~~ and Landlord shall thereupon be released of all liability to Tenant for the return of or ~~following a “draw” by Landlord of any portion of the~~ to account for such Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx . (d) If the Tenant is not then in default under this Lease and ~~Landlord as~~ does not exercise the one-time termination option pursuant to ~~Landlord’s right to draw from the Letter of Credit. No condition or term~~ Section 13.21 of this Lease ~~shall be deemed to render~~ Agreement, the Letter of Credit ~~conditional~~ shall be reduced to ~~justify the issuer of the~~ an irrevocable standby Letter of Credit as follows: (i) in ~~failing to honor a drawing~~ the amount of $37,500.00 upon ~~such Letter~~ the third anniversary of ~~Credit~~ the Date of the Lease and then (ii) in ~~a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall~~ the ~~Letter~~ amount of ~~Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within~~ $25,000.00 upon the ~~meaning~~ fourth anniversary of ~~California Civil Code Section 1950.7; (f) subject~~ the Date of the Lease, pursuant to the same terms ~~of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~and conditions provided herein.

Appears in 1 contract

Samples: Lease Agreement (OxySure Systems Inc)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after~~ If Tenant elects pursuant to Section 5(c) of the ~~mutual execution~~ Lease, Tenant may, at Tenant’s sole cost and ~~delivery~~ expense, provide Landlord with the “Letter of Credit” as a substitute for the cash Security Deposit otherwise required under this Lease, ~~Tenant shall deliver to Landlord, as collateral~~ and for the full and faithful performance by Tenant of ~~all~~ each and every term, provision, covenant, and condition of ~~its obligations~~ this Lease (if Tenant substitutes the Letter of Credit for the Security Deposit, references herein to the “Security” shall mean the Letter of Credit). If Tenant Defaults under this Lease, ~~an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”)~~then Landlord may use, substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of Californiaapply, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of retain the whole ~~or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all~~ or any part of the ~~Letter~~ Security for the payment of ~~Credit~~any Rent not paid when due, for the cost of repairing such damage, for the cost of cleaning the Premises, for the payment of any other sum which Landlord by reason of Tenant’s Default, including for compensation of Landlord for any other loss or damage to Landlord occasioned by Tenant’s Default, including, but not limited to, any loss of future Rent and any damage or deficiency in the reletting of the Premises (whether such loss, damages or deficiency accrue before or after summary proceedings or other reentry by Landlord) and the amount of the ~~Letter of Credit shall be less than the LC Amount~~unpaid past Rent, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27future Rent loss, and ~~if Xxxxxx fails to comply with the foregoing terms of this sentence~~all other losses, ~~the same shall constitute an uncurable default by Tenant. Tenant further covenants~~ costs and ~~warrants~~ damages, that ~~it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither~~ Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not would be entitled to ~~any interest earned on the Cash Collateral. If there shall occur a default~~ recover if Landlord were to pursue recovery under ~~the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part~~ Section 11.02(b) or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term (c) of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or ~~circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of~~ California Civil Code Section ~~1950.7;~~ 1951.2 or 1951.4 (fand any supplements, amendments, replacements and substitutions thereof and therefor from time to time). If Landlord so uses, applies or retains all or part of the Security, Tenant shall within five (5) ~~subject~~ business days after demand pay or deliver to Landlord in immediately available funds the ~~terms~~ sum necessary to replace the amount used, applied or retained, except as specified in (d) below. The Security (except any amount retained for application by Landlord as provided herein) shall be returned or paid over to Tenant no later than ninety (90) days after the latest of: (i) the Termination Date; (ii) the removal of Tenant from the Premises; (iii) the surrender of the Premises by Tenant to Landlord in accordance with this Lease; or (iv) the date Rent Adjustments owed pursuant to this Lease have been computed by Landlord and paid by Tenant. Provided, however, in no event shall any such ~~Section 1950.7; or (g) intended to serve~~ return be construed as ~~a “security deposit” within the meaning~~ an admission by Landlord that Tenant has performed all of ~~such Section 1950~~its obligations hereunder.

Appears in 1 contract

Samples: Office Lease (INSU Acquisition Corp. II)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after~~ If, under the ~~mutual execution and delivery of this~~ Lease, ~~Tenant shall deliver~~ Lessee is required or elects to ~~Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “~~provide Lessor with a Letter of Credit”), ~~substantially in~~ the ~~form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State~~ provisions of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”)this Clause shall apply. ~~Tenant shall provide Landlord with a specimen~~ Any Letter of Credit ~~from~~ provided by Lessee to Lessor will (i) be issued or confirmed and payable by the ~~approved issuer prior~~ London or New York branch of a major international bank whose long-term unsecured, unsubordinated and unguaranteed debt obligations are rated by Xxxxx’x Investors Services Inc. or Standard and Poors Corporation not less than Bbb and BBB, respectively, and are not on credit-watch by any of such agencies,. (ii) be in substantially the form of Schedule 11 and in form and substance reasonably acceptable to Lessor, (iii) be issued as security for all payment obligations of Lessee to Lessor or any of its Affiliates under the ~~execution~~ Lease and each Other Agreement (including any and all Losses suffered or incurred by Lessor or any of ~~this Lease. The Letter~~ its Affiliates in respect of ~~Credit shall be:~~ which Lessee or any of its Affiliates is obligated under the Lease or any Other Agreement), and (aiv) remain in full force and effect and may be drawn down by Lessor upon demand at ~~sight and irrevocable;~~any time or times following the occurrence of a Default until the Required LC Expiry Date. (b) ~~maintained in effect for~~ With the ~~entire period from the date~~ prior written consent of ~~execution of this Lease through the date~~ Lessor, which ~~is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”)~~consent shall not be unreasonably withheld, ~~subject to the last paragraph of this Article 27, provide that the expiration date of~~ the Letter of Credit ~~shall be no earlier than the Letter of Credit Termination Date~~ may have a validity period or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days periods ending prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any feesRequired LC Expiry Date, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: provided that (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Creditshall, in ~~whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties~~each case, be ~~released by Tenant from all liability therefor~~renewed, ~~and it is agreed that the provisions hereof shall apply to every transfer~~ extended or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect reissued and delivered to ~~Landlord, as applicable,~~ Lessor not later than thirty (30) ~~days~~ Business Days prior to its expiry; and (ii) a Letter of Credit shall remain in force at all times up to the ~~expiration of~~ Required LC Expiry Date. (c) If at any time during the Term the current issuing or confirming bank for the Letter of Credit ~~or amendment)~~ceases to comply with the requirements specified in paragraph (c) above, ~~which~~ Lessee shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if promptly procure that the Letter of Credit is ~~not timely renewed~~ issued or confirmed by another bank complying with such requirements. (d) If Lessor makes a ~~substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain~~ drawing under the Letter of ~~Credit~~ Credit, Lessee shall, following a demand in writing by Lessor, immediately cause the maximum amount ~~and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present~~ available for drawing under the Letter of Credit to ~~the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall~~ be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, restored to the ~~extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or~~ level at which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either it stood immediately prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950drawing.

Appears in 1 contract

Samples: Aircraft Lease Common Terms Agreement (Lan Airlines SA)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after the mutual~~ Upon execution ~~and delivery~~ of this ~~Lease~~Lease by Lessee, ~~Tenant~~ Lessee shall ~~deliver to Landlord~~deposit with Lessor an unconditional, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an~~ irrevocable ~~and unconditional negotiable~~ "evergreen" letter of ~~credit (the “Letter of Credit”)~~credit, ~~substantially~~ in the form attached hereto as Exhibit ~~G hereto~~ "F" and made a part ~~hereof~~hereof or otherwise in form and substance reasonably acceptable to Lessor and from Silicon Valley Bank or such other bank as is reasonably acceptable to Lessor (the "Issuing Bank"), ~~and containing the terms required herein, payable~~ which letter of credit shall be in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of One Million Dollars ($~~[***]~~ 1,000,000) (~~“LC~~ the amount required to be posted by Lessee at any time during the Lease Term being hereinafter referred to as the "Required Amount”") payable at the demand of Lessor without any accompanying certification (such letter of credit and any renewal thereof is hereinafter referred to as the "Letter of Credit"). ~~Tenant shall provide Landlord with a specimen~~ The failure of Lessee to timely deliver the Letter of Credit ~~from the approved issuer prior to the execution~~ shall be an immediate and material Event of ~~this Lease.~~ Default hereunder. (b) The Letter of Credit shall beprovide: (ai) at The Issuing Bank shall pay to Lessor or its duly authorized representative in an amount up to the Required Amount upon presentation of only the Letter of Credit and a sight ~~and irrevocable~~draft in the amount to be drawn; (bii) ~~maintained~~ Draws can be made by Lessor in ~~effect for~~ a New York City or San Xxxx xxxxxx of Issuing Bank, or by facsimile transmission of a copy of the ~~entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“~~Letter of Credit ~~Expiration Date”)~~and a sight draft in the amount to be drawn to a telephone number provided by Issuing Bank, ~~subject~~ in United States Dollars; (iii) The Letter of Credit shall be deemed automatically renewed, without amendment, for consecutive periods of one year each (provided that at such time as the remaining Lease Term of the Lease is less than one year, the Letter of Credit may be renewed for the remaining Lease Term plus thirty (30) days) unless the Issuing Bank sends written notice (the "Non-Renewal Notice") to Lessor by certified mail, return receipt requested, not less than thirty (30) days next preceding the ~~last paragraph of this Article 27, provide that the~~ then expiration date of the Letter of Credit ~~shall be no earlier than the~~ that it elects not to have such Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlordrenewed; (civ) ~~subject~~ Lessor, after its receipt of the Non-Renewal Notice, shall have the right, exercisable by sight draft only, to receive the ~~Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable~~ monies represented by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (~~and the bank issuing the same)~~ which monies shall be ~~acceptable~~ held by Lessor as a cash deposit pending the replacement of such Letter of Credit); and (v) In the event of a transfer of Lessor's entire interest in the Lease, the Letter of Credit shall be transferable by Lessor in accordance with the instructions of the Issuing Bank, at no cost to ~~Landlord,~~ Lessor. (c) Provided that (i) Lessee has not previously been in ~~Landlord’s reasonable discretion~~default of this Lease more than three (3) times during the Lease Term (without regard to whether such default was cured during the applicable grace period (if any)), and (ii) Lessee is not then in default (without regard to any applicable notice or grace period), the Required Amount shall ~~provide, among other things, in effect that:~~be reduced as follows (the "Reduction"): (i) ~~Landlord, or its then managing agent, shall have~~ on the ~~right to draw down an amount up to the face amount~~ second anniversary of the ~~Letter of Credit upon the presentation~~ Commencement Date, to ~~the issuing bank of Landlord’s~~ Five Hundred Thousand Dollars (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity$500,000); (ii) on the ~~Letter~~ third anniversary of ~~Credit will be honored by~~ the ~~issuing bank without inquiry as~~ Commencement Date, to ~~the accuracy thereof and regardless of whether the Tenant disputes the content of such statement~~Three Hundred Thousand Dollars ($300,000); and (iii) on the fourth anniversary of the Commencement Date, to Two Hundred Thousand Dollars ($200,000). (d) Lessor shall inspect the Leased Premises within thirty (30) days after Lessee surrenders the same in full to Lessor. Provided that no default has occurred and is then continuing and Lessee shall have timely vacated and surrendered the Leased Premises in the condition required by this Lease on the Stated Expiration Date, Lessor shall return the Letter of Credit to Lessee on or before the thirtieth (30th) day after the Stated Expiration Date. If such inspection identifies any conditions at the Leased Premises not in compliance with the Lease, Lessor may draw upon the Letter of Credit in the amount determined by Lessor to correct any such conditions and, if Lessee is not then otherwise in default hereunder, Lessor shall return the original Letter of Credit to Lessee. (e) Lessee agrees that (x) in the event Lessee is in default beyond any applicable notice and grace period (if any) in respect of any of the teens, provisions and conditions of this Lease, including, without limitation, the payment of Base Rent or any item of Additional Rent, Lessor may, without notice, draw the proceeds of the Letter of Credit in the amount of such default and apply such proceeds for the payment of any such Base Rent or item of Additional Rent as to which Lessee is in default, or for any sum which Lessor may expend or may be required to expend by reasons of such default by Lessee, including without limitation, any damages or deficiency in the reletting of the Leased Premises (collectively, the "Default Amount") and (y) if the Issuing Bank delivers a Non-Renewal Notice, Lessor may, without notice, draw the entire proceeds of the Letter of Credit and retain any of the proceeds drawn under the Letter of Credit as continued security for the faithful performance by Lessee of the terms, covenants and conditions of this Lease. Lessor shall give written notice to Lessee promptly after making any draw upon the Letter of Credit. In the event of an assignment or transfer of ~~Landlord’s~~ Lessor's interest in the ~~Building~~Lease, ~~Landlord~~ Lessor shall transfer the Letter of ~~Credit, in whole or in part~~ Credit to the assignee or transferee thereof and Lessor shall thereupon ~~the Landlord shall, without any further agreement between the parties,~~ be released by ~~Tenant~~ Lessee from all liability ~~therefor,~~ for the return of such Letter of Credit and it Lessee agrees to look solely to the new Lessor for the return of said Letter of Credit. It is agreed that the provisions hereof shall apply to every transfer or assignment made of the ~~whole or any portion of said~~ Letter of Credit to a new ~~landlord~~Lessor. ~~If, as a result of any application~~ Lessee further covenants that it will not assign or ~~use by Landlord of all~~ encumber or ~~any part of the Letter of Credit, the amount of~~ attempt to assign or encumber the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither ~~Landlord~~ Lessor nor its successors or assigns ~~will~~ shall be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit . (~~such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30~~f) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of If Lessor applies any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of ~~Credit, either prior to~~ Credit (or ~~following a “draw” by Landlord of~~ any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease cash in lieu thereof) Lessee shall not be deemed to ~~render~~ have cured the ~~Letter~~ Event of ~~Credit conditional~~ Default which gave rise to ~~justify~~ the ~~issuer~~ application of any part of the proceeds of the Letter of Credit unless and until Lessee shall have deposited with Lessor, the amount so applied (the "Deficiency"), so that Lessor shall have the Required Amount on deposit at all times during the Lease Term. In the event that Lessee does not deliver the Deficiency in ~~failing~~ cash or an additional letter of credit within five (5) business days after Lessor shall have given written notice to ~~honor a drawing upon such Letter~~ Lessee that it has drawn the Default Amount pursuant to clause (e) above, Lessor may, without notice, draw the remaining amount of ~~Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall~~ the Letter of Credit ~~or any renewal thereof or substitute therefor or Cash Collateral be:~~and hold the same as continued security for the faithful performance by Lessee of the terms, covenants and conditions of this Lease. (eg) ~~deemed to be or treated~~ Whenever Lessor draws down on the entire Letter of Credit as a ~~“security deposit” within~~ result of the ~~meaning~~ Issuing Bank's delivery of ~~California Civil Code Section 1950.7;~~ a Non-Renewal Notice or as the result of Lessee's failure to deliver the Deficiency as required in clause (f) ~~subject~~ hereof, Lessor agrees that it shall hold the proceeds thereof in excess of the portion applied by Lessor as a result of any applicable default by Lessee, as the security hereunder (in which case such cash shall constitute trust funds). Notwithstanding the terms of the preceding sentence, if Lessee shall at any time thereafter deliver a new letter of credit in the Required Amount, then Lessor shall promptly refund to Lessee such cash as has not been applied by Lessor pursuant to the terms of ~~such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~this Lease.

Appears in 1 contract

Samples: Lease Agreement (Equallogic Inc)

Letter of Credit. ~~Within forty-five (45) days after~~ In lieu of a cash Security Deposit, the ~~mutual execution and delivery of this Lease, Tenant shall deliver~~ Security Deposit to ~~Landlord, as collateral for the full and faithful performance~~ be delivered by Tenant to Landlord may be in the form of ~~all of its obligations under this Lease,~~ an irrevocable and unconditional ~~negotiable~~ letter of credit (the “Letter of Credit”)) governed by the Uniform Customs and Practice for Documentary Credits, ~~substantially~~ International Chamber of Commerce Publication No. 590, as revised from time to time, in an amount the ~~form attached as Exhibit G hereto and made a part hereof~~amount set forth in Section K of the Summary, ~~and containing the terms required herein, payable in the State of California, running in favor of~~ issued to Landlord, ~~issued~~ as beneficiary, in form and substance reasonably satisfactory to Landlord, by ~~a solvent~~ Bank of America, Xxxxx Fargo Bank or other bank reasonably approved by Landlord ~~under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association,~~ and qualified to transact banking business in California with an office in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) Greater San Francisco Bay Area at ~~sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date~~ which ~~is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of~~ drafts drawn on the Letter of Credit ~~shall~~ may be ~~no earlier than the Letter of Credit Termination Date or provide~~ presented for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial drawspayment. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the The full amount of the Letter of Credit shall be ~~less than~~ available to Landlord upon presentation of Landlord’s sight draft accompanied only by the ~~LC Amount,~~ Letter of Credit and Landlord’s signed statement that Landlord is entitled to draw on the Letter of Credit pursuant to this Lease. Tenant ~~shall, within ten (10) business days thereafter, provide~~ shall maintain the Letter of Credit for the entire Lease Term and any extension thereof. The Letter of Credit shall expressly state that the Letter of Credit and the right to draw thereunder may be transferred or assigned by Landlord ~~with an additional letter(s)~~ to any successor or assignee of ~~credit, in an amount equal~~ Landlord under this Lease. Tenant shall pay any fees related to the ~~deficiency (~~issuance or ~~a replacement letter~~ amendment of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or including, without limitation, any ~~part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance~~transfer fees. ~~Without limiting the generality of the foregoing, if the~~ The Letter of Credit ~~expires earlier than~~ shall permit partial draws. The Letter of Credit shall provide that it will be automatically renewed until thirty (30) days after the ~~Lease~~ Expiration ~~Date,~~ Date unless the issuer provides Landlord ~~will accept a~~ with written notice of non-renewal ~~letter of credit or substitute letter of credit~~ at the notice address herein at least sixty (~~such renewal or substitute letter of credit~~ 60) days prior to ~~be in effect and delivered to Landlord, as applicable~~the expiration thereof. If, not later than thirty (30) days prior to the expiration of the Letter of ~~Credit or amendment)~~Credit, ~~which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring~~ Tenant fails to furnish Landlord with a replacement Letter of Credit ~~or such other terms as may be acceptable~~ pursuant to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms ~~set forth in~~ and conditions of this ~~Article 27~~Section, then Landlord shall have the right to ~~present~~ draw the full amount of the Letter of ~~Credit to the issuing bank in accordance with the terms of this Article 27~~Credit, by sight draft, and ~~the entire sum evidenced thereby~~ shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a ~~“security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject~~ cash Security Deposit pursuant to the terms and conditions of Section 6.1 above. In such ~~Section 1950.7; or (g) intended~~ event, Landlord may keep the Security Deposit in its general funds and shall not be required to ~~serve as a “security deposit” within~~ pay interest to Tenant on the ~~meaning of such Section 1950~~deposit amount.

Appears in 1 contract

Samples: Lease Agreement (Jive Software, Inc.)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after the mutual execution~~ As collateral security for prompt and ~~delivery~~ complete performance of GCA’s obligations under Section 2 of this ~~Lease~~Agreement (the “Obligations”), ~~Tenant~~ the Company shall ~~deliver to Landlord, as collateral for~~ at the ~~full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable~~ Closing cause a letter of credit (in a form to be reasonably acceptable to FDC) to be issued to FDC in the amount of $1,000,000 by a qualified financial institution selected by the Company with the prior consent of FDC, such consent not to be unreasonably withheld, together with instructions to the issuer of such letter of credit (“Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord ) to make payments to FDC thereunder for any indemnified amounts under the ~~supervision~~ Sponsorship Indemnification Agreement upon an Event of ~~the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”)~~Default. Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) Within 30 days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Closing Date, ~~unless~~ the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant Company shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or cause a replacement letter of credit (in ~~the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails~~ a form no less favorable to ~~comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber~~ FDC than the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit ) to be ~~in effect and delivered~~ issued to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit FDC in the amount ~~and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter~~ of ~~Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash~~ $3,000,000 (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, a “Letter of Credit”) by a qualified financial institution selected by the Company with the prior consent of FDC, such consent not to be unreasonably withheld, together with instructions to the issuer of such letter of credit to make payments to FDC thereunder for any indemnified amounts under the Sponsorship Indemnification Agreement upon an Event of Default. On each anniversary of the Closing Date through September 30, 2010, the Company shall (i) notify FDC of the amount of the Cash ~~Collateral held by Landlord shall be returned to Tenant. Landlord shall have~~ Advance Net Revenue of the ~~right to hold Cash Collateral in a deposit account~~ Company and its subsidiaries for the prior calendar year, and (ii) in the ~~name~~ event that the amount of ~~Landlord and commingle~~ the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the then current Letter of Credit ~~and/or utilize~~ is less than the ~~Cash Collateral~~then current Target Amount, cause a replacement letter of credit (in ~~part or~~ a form no less favorable to FDC than the then current Letter of Credit) to be issued to FDC in ~~whole~~the Target Amount (each such replacement letter of credit, a “Letter of Credit”) by a qualified financial institution selected by the Company with the prior consent of FDC, such consent not to be unreasonably withheld, together with instructions to the ~~extent necessary~~ issuer of such letter of credit to ~~cure any default of Tenant and/or~~ make payments to ~~compensate Landlord~~ FDC thereunder for any ~~and~~ indemnified amounts under the Sponsorship Indemnification Agreement upon an Event of Default. Subject to Section 4(f), at all ~~damages~~ times on or after 30 days following the Closing Date, the Company shall cause a Letter of Credit to be continuously maintained (by renewal or replacement) for the benefit of FDC in an amount not less than the then applicable Target Amount. For the avoidance of doubt, after the issuance of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the replacement Letter of Credit, ~~either prior to or following a “draw” by Landlord of~~ any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit ~~conditional~~ replaced thereby shall be terminable by the Company, such that the Company shall not be obligated to ~~justify the issuer of the~~ maintain more than one Letter of Credit ~~in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or~~ at any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950one time.

Appears in 1 contract

Samples: Sponsorship Indemnification Agreement (Central Credit, LLC)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days~~ Not later than seven (7) Business Days after the ~~mutual execution~~ Amendment No. 6 Effective Date, the Administrative Agent agrees to return the original Letter of Credit together with an original (signed in ink) and ~~delivery of this Lease, Tenant shall deliver to Landlord,~~ dated letter on the Administrative Agent’s letterhead (shown exactly as ~~collateral for~~ it appears on the ~~full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “~~Letter of Credit”), substantially in the form attached hereto as Exhibit ~~G hereto and made a part hereof, and containing~~ D (the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association“LC Termination Notice”), in ~~the initial amount of $[***]~~ each case, to Silicon Valley Bank (“SVB”)at the following address via overnight service with tracking: Silicon Valley Bank 0000 Xxxxxx Xxxxx, XX000 Xxxxx Xxxxx, XX 00000 Attn: Standby LC ~~Amount”)~~Dept. ~~Tenant shall provide Landlord~~ The Lenders irrevocably authorize the Administrative Agent to take any actions described in this Section 12(a) with ~~a specimen~~ respect to the Letter of ~~Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable;~~Credit. (b) ~~maintained in effect for~~ Within two (2) Business Days of receipt by the ~~entire period~~ Borrower of confirmation from SVB that SVB has satisfactorily received the ~~date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“~~original Letter of Credit ~~Expiration Date”)~~and LC Termination Notice, ~~subject to~~ the ~~last paragraph~~ Borrower shall notify (which may be via email) the Administrative Agent of ~~this Article 27, provide~~ the same. (c) Within two (2) Business Days (or such longer period that the ~~expiration date of~~ Administrative Agent may agree in its sole discretion) after SVB has made the cash that secured the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior available to the ~~expiration~~ Parent in respect of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the returned Letter of Credit, the Borrower shall have prepaid outstanding Loans in an aggregate principal amount of $25,000,000 (the ~~Letter~~ “Post-Closing Prepayment”). Notwithstanding anything to the contrary in Section 2.2(e) of ~~Credit~~ the Loan Agreement, any accrued and unpaid Interest and Fees in respect of the Post-Closing Prepayment shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and payable in accordance with the ~~terms set forth in this Article 27~~Priority of Payments, ~~Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance~~ rather than paid together with the ~~terms of this Article 27~~Post-Closing Prepayment. (d) If the Borrower does not make the Post-Closing Prepayment pursuant to clause (c) above, ~~and the entire sum evidenced thereby~~ it shall be ~~paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance~~ an Event of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default Default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950Loan Agreement.

Appears in 1 contract

Samples: Loan and Security Agreement (Bird Global, Inc.)

Letter of Credit. ~~Within forty-five~~ (45a) days after the mutual execution and delivery of this Lease, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen The Borrower has requested that Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, Issuer provide ~~that the expiration date of~~ the Letter of Credit ~~shall be no earlier than~~ as credit enhancement for the ~~Letter of Credit Termination Date or provide for automatic renewal thereof~~ Bonds. Park at ~~least through the Letter of Credit Expiration Date~~Highlands LLC, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a ~~new Letter of Credit to Landlord at least thirty (30) days prior to the expiration~~ Subsidiary of the ~~Letter~~ Borrower, is the owner of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable Real Estate located in Douglas County, Colorado which will be benefitted by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms thx xxxxxnce of the ~~Letter of Credit (~~Bonds and the ~~bank issuing~~ improvements to be constructed with the ~~same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have~~ proceeds from the ~~right to draw down an amount up to the face amount~~ issuance of the ~~Letter~~ Bonds. The issuance of ~~Credit upon~~ the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) Bonds and the Letter of Credit will ~~be honored by the issuing bank without inquiry as~~ inure to the ~~accuracy thereof~~ direct interest and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment benefit of the ~~whole or any portion of said Letter of Credit to a new landlord~~Borrower. ~~If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of~~ The Borrower acknowledges and agrees that the Letter of Credit ~~shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter,~~ Issuer would not have agreed to provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit ~~expires earlier than~~ unless the ~~Lease Expiration Date~~Banks agreed to participate in advances made thereunder as provided in this Agreement, ~~Landlord will accept a renewal letter of credit or substitute letter of credit~~ and the Banks would not have agreed to participate in such advances without (~~such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30~~i) ~~days prior to~~ the ~~expiration~~ agreement of the ~~Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or~~ Borrower to repay such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank advances in accordance with the terms of this ~~Article 27,~~ Agreement and (ii) the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer reservation of the Letter of Credit ~~in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree~~ Commitment from the Total Commitment. (b) In the event that ~~in no event or circumstance shall~~ the Letter of Credit Issuer shall honor any draw or other presentation for payment under the Letter of Credit and the amount so paid by Letter of Credit Issuer shall not be reimbursed by the Borrower or any ~~renewal thereof~~ other Person in the manner and within the time period set forth in Section 2.1 or ~~substitute therefor~~ Section 2.2 of the Reimbursement Agreement, the Letter of Credit Issuer shall promptly notify the Agent in writing of the amount of such draw and whether such draw was an "Interest Drawing," a "Principal Drawing' or ~~Cash Collateral be:~~ a "Liquidity Drawing" (eas such terms are defined in the Letter of Credit). In the event such notice shall be delivered to Agent on or before 10:00 a.m. (Boston time) of a Business Day, the Agent shall, prior to the end of such Business Day, without notice to or the consent of the Borrower, notify the Banks of such draw, and the Banks shall make available to the Agent in accordance with Section 2.7 their respective Letter of Credit Commitment Percentages of the amount so paid by the Letter of Credit Issuer on or before 12:00 noon (Boston time) on the next Business Day; provided, however, that the Letter of Credit Issuer shall automatically and without further action be deemed to have advanced to itself on such Business Day the amount of its Letter of Credit Commitment Percentage of such draw without funding the same to the Agent. Each Bank's obligation to make such payment to the Agent shall not be limited or ~~treated~~ impaired by the occurrence or continuance of any Default or Event of Default by Borrower, the failure to meet any condition that otherwise must be met for the funding of any Loan, or the failure of any other Bank to make any payment under this Section 2.9(b), and each Bank further agrees that such payment shall be made without any offset, abatement, withholding or reduction whatsoever except as otherwise provided in any intercreditor agreement among the Banks and Agent. The proceeds of such funding by the Banks received by 12:00 noon (Boston time) shall be paid by the Agent to the Letter of Credit Issuer on such Business Day (or if received after such time, by the close of the following Business Day) and all such amounts advanced by the Banks hereunder (including, without limitation, the Letter of Credit Issuer) shall be evidenced by the Notes. The amount so drawn shall from the date of such advance by the Banks pursuant to this Section 2.9 be considered Loans for all purposes hereunder bearing interest as provided in Section 2.5(a); provided, however, that the Borrower shall pay the Letter of Credit Issuer interest at the rate and upon the terms contained in the Reimbursement Agreement on the amount so drawn from the date of such advance by the Letter of Credit Issuer until the date of such advance by the Banks to Agent as provided above. The Borrower irrevocably authorizes each Bank to make or cause to be made such advances at such time notwithstanding the fact that any other conditions to the obligations of the Banks to make such advances to the Borrower under this Agreement may not have been satisfied. At such time as the Banks shall fund or be deemed to have funded a ~~“security deposit”~~ Loan pursuant to this Section 2.9(b), the Borrower will be deemed to have reimbursed the Letter of Credit Issuer under the Reimbursement Agreement for such amounts, and the Borrower and Palomino Park therefore shall no longer be obligated to reimburse such amounts pursuant to the Reimbursement Agreement, and such obligation shall thereafter be evidenced by the Notes. The provisions of Section 2.7 shall apply to any Banks failing or refusing to fund its Letter of Credit Commitment Percentage with respect to any such draw, and shall not affect the Borrower's and Palomino Park's reimbursement obligations under the Reimbursement Agreement and the Related Documents being deemed to have been satisfied; provided, however, that the Borrower's and Palomino Park's obligations under the Reimbursement Agreement and the Related Documents with respect to a payment made under the Letter of Credit shall not be deemed to have been reimbursed in the event that all of the Banks fail or refuse to fund a Loan with respect thereto pursuant to this Section 2.9(b) and none of such Banks cures such failure or refusal within the ~~meaning~~ time period permitted in any intercreditor agreement among the Banks and Agent. If after receipt of ~~California Civil Code Section 1950.7; (f) subject~~ such funding from any Bank the Letter of Credit Issuer receives payment from the Borrower or any other source on account of the reimbursement obligation that was so funded, or the interest accrued thereon, the Letter of Credit Issuer shall remit such payment to the ~~terms~~ Agent for distribution to the Banks to the extent of ~~such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~their participation therein.

Appears in 1 contract

Samples: Revolving Credit Agreement (Wellsford Residential Property Trust)

Letter of Credit. ~~Within forty-five~~ (45a) No later than ten (10) days ~~after~~ following the ~~mutual~~ full execution ~~and delivery~~ of this ~~Lease~~Lease (and in any event prior to Landlord’s obligation to commence construction of Tenant Improvements in the Premises or to allow Tenant or any of Tenant’s agents access to the Premises), Tenant shall deliver to ~~Landlord~~Landlord a Letter of Credit, ~~as collateral for the full and faithful~~ which shall be held by Landlord to secure Tenant’s performance ~~by Tenant of all~~ of its obligations under this Lease. The Letter of Credit is not an advance payment of Rent or a measure or limit of Landlord’s damages upon an Event of Default (as defined below). Landlord may, from time to time following an ~~irrevocable~~ Event of Default and ~~unconditional negotiable~~ without prejudice to any other remedy, use all or a part of the Letter of Credit to perform any obligation Tenant fails to perform hereunder. Notwithstanding anything to the contrary in this Section 6, at any time during the Term, Tenant may elect to deposit with Landlord a letter of credit from an Eligible Institution (as defined below) in form and substance reasonably approved by Landlord, payable upon presentation of a sight draft without more (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of beneficiary under the Letter of Credit shall be ~~no earlier than~~ shown as “W2007 Seattle office 000 Xxxxxx Xxxxx Realty, LLC, its successors and assigns” or otherwise as specified by Landlord. Tenant shall renew the Letter of Credit ~~Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date~~from time to time, ~~unless the issuing bank provides~~ at least thirty (30) days prior ~~written notice~~ to expiration thereof, and deliver to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit or an endorsement to the Letter of Credit or any other evidence required by Landlord that the Letter of Credit has been renewed for at least an additional one (1) year period (with respect to each renewal). The amount of the Letter of Credit shall be equal to the amount set forth in the Basic Lease Information, for the full, timely and faithful performance of Tenant’s covenants and obligations under this Lease, it being expressly understood and agreed that (a) the Letter of Credit does not constitute a measure of Landlord’s damages in the event of Tenant’s default, and (b) the Letter of Credit is not being provided as an equivalent or in lieu of any security deposit, but rather to assure Landlord of a means of third-party security apart from and completely independent of Tenant’s assets and creditworthiness. (b) The Letter of Credit shall not be mortgaged, assigned or encumbered in any manner whatsoever by Tenant. Such Letter of Credit shall (1) be transferable and assignable by Landlord, more than once, at Landlord’s option and (2) include an automatic renewal clause (an “Evergreen Clause”) and require notice of non-renewal ninety (90) days in advance of any automatic renewal date. All charges, fees and costs related to such Letter of Credit (including, without limitation, as a result of any transfer by Landlord) shall be borne by Tenant. Upon the occurrence of an Event of Default, Landlord shall have the right, at its option, to draw on the Letter of Credit and to apply all or any part thereof to the payment of the items for which the Letter of Credit was established or to apply the Letter of Credit to the satisfaction of Tenant’s obligations under this Lease in such order, proportion or priority as Landlord may determine. In addition to any other right Landlord may have to draw upon the Letter of Credit, Landlord shall have the additional rights to draw in full the Letter of Credit (regardless of whether this Lease is in default): (A) with respect to any Letter of Credit containing an Evergreen Clause, if Landlord has received a notice from the issuing bank that the Letter of Credit will not be renewed and a substitute Letter of Credit is not provided at least thirty (30) days prior to the date on which the outstanding Letter of Credit is scheduled to expire; (B) with respect to any Letter of Credit with a stated expiration of date, if Landlord has not received a notice from the issuing bank that it has renewed the Letter of Credit ~~without any action whatsoever on the part of Landlord;~~ at least ninety (c90) ~~subject~~ days prior to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any date on which such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit ~~(and the bank issuing the same) shall be acceptable~~ is scheduled to ~~Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord,~~ expire or ~~its then managing agent, shall have the right to draw down an amount up to the face amount of the~~ a substitute Letter of Credit ~~upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord~~ is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not ~~later than~~ provided at least thirty (30) days prior to the ~~expiration~~ date on which the outstanding Letter of Credit is scheduled to expire; (C) upon receipt of notice from the issuing bank that the Letter of Credit will be terminated (except if a substitute Letter of Credit is provided by Tenant within ten (10) days following Landlord’s written demand therefore, with no other notice or cure or grace period being applicable thereto, notwithstanding anything in this Lease to the contrary), or (D) if Landlord receives information that the bank issuing the Letter of Credit is no longer an Eligible Institution. Notwithstanding anything to the contrary contained in the above, Landlord is not obligated to draw any Letter of Credit upon the happening of an event specified in (A), (B), (C) or (D) above and shall not be liable for any losses sustained by Tenant due to the insolvency of the bank issuing the Letter of Credit if Landlord has not drawn the Letter of Credit. Any amount of the Letter of Credit that is drawn upon by Landlord, but not used or ~~amendment)~~applied by Landlord, ~~which~~ shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord ~~as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease~~ and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord deemed a security ~~interest in the Cash Collateral~~deposit pursuant to this Section 6(b). ~~Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods~~The use, ~~Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part~~ application or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds retention of the Letter of Credit, ~~either prior to~~ or ~~following a “draw”~~ any portion thereof, by Landlord of shall not prevent Landlord from exercising any ~~portion of the Letter of Credit~~other right or remedy provided in this Lease, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and or by law, it being understood that Landlord as shall not first be required to ~~Landlord’s right to draw from~~ proceed against the Letter of Credit. ~~No condition or term of this Lease shall be deemed to render~~ Tenant agrees and acknowledges that (i) the Letter of Credit ~~conditional to justify the issuer of the Letter of Credit in failing to honor~~ constitutes a ~~drawing upon such Letter of Credit in a timely manner.~~ separate and independent contract between Landlord and the issuing bank, (ii) Tenant ~~acknowledge and agree that~~ is not a third party beneficiary of such contract, (iii) Tenant has no property interest whatsoever in ~~no event or circumstance shall~~ the Letter of Credit or the proceeds thereof, and (iv) in the event Tenant becomes a debtor under any ~~renewal thereof~~ chapter of the Bankruptcy Code, Tenant is placed into receivership or ~~substitute therefor~~ conservatorship, and/or there is an event of a receivership, conservatorship or ~~Cash Collateral be: (e) deemed~~ a bankruptcy filing by, or on behalf of, Tenant, neither Tenant, any trustee, receiver or conservator, nor Tenant’s bankruptcy estate shall have any right to be restrict or ~~treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject~~ limit Landlord’s claim and/or rights to the ~~terms~~ Letter of ~~such~~ Credit and/or the proceeds thereof by application of Section ~~1950.7; or (g~~502(b)(6) ~~intended to serve as~~ of the U.S. Bankruptcy Code or otherwise. For the purposes of this Section 6(b), the term “Eligible Institution” shall mean a depository institution or trust company insured by the Federal Deposit Insurance Corporation the long term unsecured debt obligations of which are rated at least “~~security deposit~~AA-” ~~within the meaning of such Section 1950~~by Fitch and Standard & Poors and “Aa2” by Xxxxx’x.

Appears in 1 contract

Samples: Lease Agreement (Hipcricket, Inc.)

Letter of Credit. ~~Within~~ Notwithstanding the foregoing, the Security Deposit may be provided by Subtenant in the form of an unconditional, irrevocable, transferable standby letter of credit (the "Initial Letter of Credit") substantially in the form attached hereto as Exhibit C (or such other form as may be reasonably acceptable to Sublandlord) and issued by a financial institution (the "Issuing Bank") acceptable to Sublandlord in its good faith discretion (Sublandlord hereby approving Bank of America). Sublandlord hereby approves Bank of America N.A. as the initial Issuing Bank. Subtenant shall cause the Letter of Credit to be continuously maintained in effect (whether through a Replacement Letter of Credit (defined below), amendment, renewal or extension) through the date (the "Final Letter of Credit Expiration Date") that is the later to occur of (i) the date that is forty-five (45) days after the ~~mutual execution~~ scheduled Expiration Date of the Term and ~~delivery of this Lease, Tenant shall deliver to~~ (ii) provided that Subtenant has not entered into a Direct Occupancy Agreement with Landlord, ~~as collateral for~~ the ~~full~~ date that is forty-five (45) days after Subtenant vacates the Subleased Premises and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, completes any restoration or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be:repair obligations. (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject Without prejudice to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice any other remedy available to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing Sublandlord under this ~~Lease~~Sublease or at law, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as Sublandlord may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Initial Letter of Credit or any ~~renewal thereof~~ Replacement Letter of Credit on or ~~substitute therefor or Cash Collateral be:~~ after the occurrence of either: (ei) ~~deemed~~ an uncured Event of Default under this Sublease; (ii) any failure by Subtenant to ~~be or treated~~ deliver to Sublandlord a Replacement Letter of Credit as ~~a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject~~ and when required pursuant to the ~~terms~~ provisions of ~~such~~ Section ~~1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.~~4.2(b);

Appears in 1 contract

Samples: Sublease Agreement (Care.com Inc)

Letter of Credit. Within ~~forty-five~~ ten (4510) days ~~after~~ following the ~~mutual~~ fall execution ~~and delivery~~ of this Lease, Tenant shall deliver to Landlord, as ~~collateral~~ protection for the ~~full~~ fall and faithful performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer (or that Landlord reasonably estimates it may suffer) as a result of any breach, default or failure to perform by Tenant under this Lease, an irrevocable and unconditional negotiable ~~letter of credit (the “~~standby Letter of Credit”), ~~substantially~~ in a form that is acceptable to Landlord, payable at an office in the ~~form attached as Exhibit G hereto and made a part hereof~~San Francisco Bay Area, ~~and containing the terms required herein, payable in the State of~~ California, running in favor of ~~Landlord,~~ Landlord and issued by a ~~solvent~~ solvent, nationally recognized bank ~~reasonably approved by Landlord~~ with a short term Fitch Rating of not lower than FI or higher and a long term Fitch Rating of A or higher (or in the event such Fitch Ratings are no longer available, a comparable rating from Standard and Poor’s Professional Rating Service or Xxxxx’x Professional Rating Service), under the supervision of the Superintendent of Banks of the State of California, or a ~~National Banking Association~~national banking association (an “Acceptable Issuing Bank”), in the ~~initial~~ amount provided in Section 1.11 as the Letter of ~~$[***]~~ Credit Amount (“~~LC Amount~~Letter of Credit”). Landlord hereby approves Silicon Valley Bank as an Acceptable Issuing Bank. Tenant shall ~~provide~~ pay all expenses, points, or fees incurred by Tenant in obtaining the Letter of Credit and any replacement Letter of Credit. The form and terms of the Letter of Credit and the bank issuing the same (the “Bank”) shall be subject to Landlord’s prior written approval. Landlord ~~with a specimen~~ hereby approves the form of Letter of Credit from Silicon Valley Bank attached hereto as Exhibit F. If an Acceptable Issuing Bank is declared insolvent or taken over by the Federal Deposit Insurance Corporation or any governmental agency for any reason or does not meet the standards to be approved ~~issuer prior to~~ an Acceptable Issuing Bank, Tenant shall deliver a replacement Letter of Credit from another Bank approved by Landlord that meets the ~~execution~~ standards for an Acceptable Issuing Bank within the earlier of ~~this Lease~~(i) thirty (30) days after notice from Landlord that the Bank does not meet the standard for an Acceptable Issuing Bank, or (ii) the date the Bank is declared insolvent or taken over for any reason by the Federal Deposit Insurance Corporation or any other governmental agency. ~~The~~ In addition, the Letter of Credit shall beexpressly provide for the following: (a1) shall be “callable” at ~~sight~~ sight, irrevocable, and ~~irrevocable~~unconditional; (b2) shall be maintained in ~~effect~~ effect, whether through renewal or extension, for the ~~entire~~ period from the date of ~~execution of~~ this Lease ~~through~~ and continuing until the date ~~which is sixty~~ (~~60) days following~~ the ~~Termination Date (~~“Letter of Credit Expiration Date”) that is sixty (60) days after the expiration of the Term (as the Term may be extended). The Letter of Credit may be for one year period, ~~subject~~ provided the Letter of Credit is automatically extended for not less than a one year period unless the issuing Bank provides written notice to Landlord not less than sixty (60) days prior to the ~~last paragraph of this Article 27, provide that the~~ then expiration date of the Letter of Credit ~~shall be no earlier than~~ that the issuing Bank will not renew or extend the Letter of ~~Credit Termination Date or provide for automatic renewal thereof at least through the~~ Credit, in which case Tenant shall deliver to Landlord a replacement Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least not less than thirty (30) days prior to the scheduled expiration date of the then existing Letter of Credit held by Landlord without any action whatsoever on the part of Landlord; (c3) shall be fully assignable by Landlord, its successors, and assignees of its interest in the Complex in connection with Landlord’s sale or financing of the Building and Complex; (4) shall permit partial draws and multiple presentations and drawings; and (5) shall be otherwise subject to the Uniform Customs and Practices for Documentary ~~Credits (1993-Rev)~~ Credits, International Chamber of Commerce Publication ~~#600; and~~ No. 600 (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnershipUCP600), or ~~any authorized party~~ the International Standby Practices-ISP 98, International Chamber of Commerce Publication No. 590 (~~if another entity~~1998); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Office Lease (Terns Pharmaceuticals, Inc.)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after the mutual execution and delivery~~ In lieu of ~~this Lease~~a Security Deposit, Tenant shall have the right to deliver to Landlord, as ~~collateral~~ protection for the full and faithful performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer (or that Landlord reasonably estimates it may suffer) as a result of any breach or default by Tenant under this Lease, an irrevocable and unconditional negotiable ~~letter~~ standby Letter of ~~credit~~ Credit (~~the~~ “Letter of Credit”), ~~substantially~~ in the form attached to this Lease as Exhibit ~~G hereto and made a part hereof,~~ I and containing the terms required ~~herein~~in this provision, payable in the ~~State~~ Cities of Santa Xxxxx or San Jose, California, running in favor of ~~Landlord,~~ Landlord and issued by Silicon Valley Bank or another solvent, nationally recognized bank with a ~~solvent bank reasonably approved by Landlord~~ long term rating of BBB or higher, under the supervision of the Superintendent of Banks of the State of California, or a ~~National Banking Association~~national banking association, in the ~~initial~~ amount of Two Million Seven Thousand Two Hundred Sixty and 37/100ths Dollars ($~~[***]~~ 2,007,260.37) (“LC Letter of Credit Amount”). Tenant shall ~~provide Landlord with a specimen~~ deliver the Letter of Credit ~~from~~ to Landlord no later than five (5) Business Days after the ~~approved issuer prior to the~~ mutual execution and delivery of this Lease. Tenant shall pay all expenses, points, or fees incurred by Tenant in obtaining the Letter of Credit. The Letter of Credit shall ~~be:~~ (a1) be “callable” at ~~sight~~ sight, irrevocable, and ~~irrevocable;~~ unconditional; (b2) be maintained in ~~effect~~ effect, whether through renewal or extension, for the ~~entire~~ period from the ~~date of execution of this~~ Lease ~~through~~ Commencement Date and continuing until the date ~~which is sixty (60) days following the Termination Date~~ (“Letter of Credit Expiration Date”~~), subject to the last paragraph of this Article 27, provide~~ ) that is one hundred twenty (120) days after the expiration ~~date~~ of the ~~Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date~~Term, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, and Tenant shall deliver a new Letter of Credit or certificate of renewal or extension to Landlord at least ~~thirty~~ sixty (3060) days ~~prior to~~ before the expiration of the Letter of Credit then held by Landlord, without any action whatsoever on the part of Landlord; ; (c3) be fully assignable by Landlord, its successors, and assigns; (4) permit partial draws and multiple presentations and drawings; (e) be honored by the bank issuing the same (“Bank”) regardless of whether Tenant disputes Landlord’s right to draw on the Letter of Credit; and (5) be otherwise subject to ~~the~~ Uniform Customs and ~~Practices~~ Practice for Documentary ~~Credits (1993-Rev)~~ Credits, International Chamber of Commerce Publication ~~#600; and~~ No. 600 (dUCP600) ~~fully assignable by Landlord in connection with any number~~ or International Standby Practices-ISP98, International Chamber of ~~transfers of Landlord’s interest in this Lease~~ Commerce Publication No. 590 (~~with Tenant bearing any fees, costs or expenses in connection with any such transfer~~1998), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In ~~addition to the foregoing~~addition, the form and terms of the Letter of Credit (and the ~~bank~~ issuing ~~the same)~~ Bank shall be acceptable to Landlord, in Landlord’s ~~reasonable~~ sole discretion~~, and shall provide, among other things, in effect that: (i)~~ . Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit ~~upon~~ if any of the ~~presentation~~ following shall have occurred or be applicable: (1) such amount is due to Landlord under the ~~issuing bank~~ terms and conditions of ~~Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under~~ this Lease~~, it being understood that if Landlord or its managing agent be~~ ; (2) Tenant has filed a ~~corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership),~~ voluntary petition under any chapter of the U.S. Bankruptcy Code or any ~~authorized party~~ similar state law (~~if another entity~~collectively, “Bankruptcy Code”); ; (ii3) Tenant has assigned any or all of its assets to creditors in accordance with any federal or state laws; (4) an involuntary petition has been filed against Tenant under any chapter of the Bankruptcy Code; or (5) the Bank has notified Landlord that the Letter of Credit will not be ~~honored by~~ renewed or extended through the ~~issuing bank~~ Letter of Credit Expiration Date. (b) The Letter of Credit shall also provide that Landlord, its successors, and assigns, may, at any time and without ~~inquiry as~~ notice to Tenant and without first obtaining Tenant’s consent, transfer (one or more times) all or any portion of its interest in and to the ~~accuracy thereof and~~ Letter of Credit to another party, person, or entity, regardless of whether such transfer is separate from or a part of the ~~Tenant disputes the content~~ assignment by Landlord of ~~such statement; and (iii)~~ its rights and interests in and to this Lease. In the event of a transfer of Landlord’s interest in the ~~Building~~Leased Premises, Landlord shall transfer the Letter of Credit, in whole or in ~~part~~ part, to the transferee and ~~thereupon the~~ Landlord ~~shall~~shall then, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions ~~hereof~~ of this Article shall apply to every transfer or assignment of the whole or any portion of ~~said~~ the Letter of Credit to a new landlord. In connection with any such transfer of the Letter of Credit by Landlord, Tenant shall, at Tenant’s sole cost and expense, execute and submit to the Bank such applications, documents, and instruments as may be necessary to effectuate such transfer, and Tenant shall be responsible for paying the Bank’s transfer and processing fees in connection with any such transfer. (c) If, as a result of ~~any application or use by~~ Landlord ~~of all or any part of~~ drawing on the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Letter of Credit Amount, Tenant shall, within ~~ten~~ five (105) ~~business days thereafter~~Business Days after the drawdown by Landlord, provide Landlord with an additional letter(s) of ~~credit,~~ credit in an amount equal to the ~~deficiency (or a replacement letter of credit in the total amount of the LC Amount)~~ deficiency, and any such additional ~~(or replacement~~letter(s) ~~letter~~ of credit shall comply with all of the provisions of this ~~Article 27, and if Xxxxxx~~ Section 17.07(ii). If Tenant fails to comply with this requirement, despite anything to the ~~foregoing terms of~~ contrary contained in this ~~sentence~~Lease, the same shall constitute an ~~uncurable~~ incurable default by Tenant. . (d) Tenant ~~further~~ covenants and warrants that it will neither assign nor encumber the Letter of ~~Credit,~~ Credit or any part ~~thereof~~ of it and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted ~~assignment~~ assignment, or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the ~~Lease~~ Letter of Credit Expiration Date, Landlord will accept a renewal ~~letter~~ of ~~credit or substitute~~ the letter of credit (such renewal ~~or substitute~~ letter of credit to be in effect and delivered to Landlord, as applicable, not later than ~~thirty~~ sixty (3060) days ~~prior to~~ before the expiration of the Letter of ~~Credit or amendment~~Credit), which shall be irrevocable and automatically renewable as required in section above ~~provided~~ through the ~~Lease~~ Letter of Credit Expiration Date ~~upon~~ on the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its ~~reasonable~~ sole discretion. However, if the Letter of Credit is not timely ~~renewed or a substitute or amendment to letter of credit is not timely received~~renewed, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth ~~in this Article 27~~above, Landlord shall have the right to present the Letter of Credit to the ~~issuing bank~~ Bank in accordance with the terms ~~of this Article 27~~hereof, and the ~~entire sum evidenced thereby shall~~ proceeds of the Letter of Credit may be ~~paid to and held~~ applied by Landlord ~~as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations~~ against any Rent payable by Tenant under this Lease that is not paid when due and to pay for all losses and damages that Landlord ~~may~~ has suffered or that Landlord reasonably estimates that it will suffer as a result of any breach or default by Tenant under this ~~Lease pending Tenant’s delivery to Landlord of~~ Lease. Any unused proceeds shall constitute the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name property of Landlord and ~~commingle~~ need not be segregated from Landlord’s other assets. Landlord agrees to pay to Tenant within thirty (30) days after the ~~Cash Collateral with its general assets~~ Letter of Credit Expiration Date the amount of any proceeds of the Letter of Credit received by Landlord and not (1) applied against any Rent payable by Tenant ~~hereby grants~~ under this Lease that was not paid when due or (2) used to pay for any losses and damages suffered by Landlord (or reasonably estimated by Landlord that it will suffer) as a ~~security interest in~~ result of any breach or default by Tenant under this Lease; provided, however, that if before the ~~Cash Collateral.~~ Letter of Credit Expiration Date a voluntary petition under the Bankruptcy Code is filed by Tenant, or an involuntary petition is filed against Tenant by any of Tenant’s creditors, then Landlord shall not be ~~entitled~~ obligated to ~~any interest earned~~ make such payment in the amount of the unused Letter of Credit proceeds until either (x) all preference issues relating to payments under this Lease have been resolved in such bankruptcy or reorganization case or (y) such bankruptcy or reorganization case has been dismissed. (e) Tenant acknowledges and agrees that Landlord is entering into this Lease in material reliance on the ~~Cash Collateral~~ability of Landlord to draw on the Letter of Credit on the occurrence of any breach or default on the part of Tenant under this Lease. If ~~there~~ Tenant shall ~~occur a~~ breach any provision of this Lease or otherwise be in default under ~~the Lease beyond all applicable notice and cure periods~~this Lease, Landlord may, but without obligation to do so, and without notice to Tenant, draw ~~upon~~ on the Letter of ~~Credit and/or utilize the Cash Collateral~~Credit, in part or in whole, to ~~the extent necessary to~~ cure any breach or default of Tenant ~~and/or~~ and to compensate Landlord for any and all damages of any kind or nature sustained or which ~~may be sustained by~~ Landlord reasonably estimates that it will sustain resulting from Tenant’s breach or default, including any damages that accrue upon termination of the Lease under the Lease and/or California Civil Code §1951.2 or any similar provision. Landlord’s use, application, or retention of any proceeds of the Letter of Credit, or any portion of it, shall not prevent Landlord from exercising any other right or remedy provided by this Lease or by any applicable law, it being intended that Landlord shall not first be required to proceed against the Letter of Credit, and shall not operate as a limitation on any recovery to which Landlord may otherwise be ~~permitted by the express terms and conditions of this Lease~~entitled. ~~Xxxxxx~~ Tenant agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either ~~prior to~~ before or following a ~~“draw”~~ draw by Landlord of any portion of the Letter of Credit, ~~[***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION.~~ regardless of whether any dispute exists between ~~Xxxxxx~~ Tenant and Landlord as to Landlord’s right to draw ~~from~~ on the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a ~~drawing upon~~ draw on such Letter of Credit in a timely manner. Tenant agrees and acknowledges that (1) the Letter of Credit constitutes a separate and independent contract between Landlord and the Bank; (2) Tenant is not a third party beneficiary of such contract; (3) Tenant has no property interest whatsoever in the Letter of Credit or the proceeds of it; and (4) if Tenant becomes a debtor under any chapter of the Bankruptcy Code, neither Tenant, any trustee, nor Tenant’s bankruptcy estate shall have any right to restrict or limit Landlord’s claim or rights to the Letter of Credit or the proceeds of it by application of 11 USC §502(b)(6) or otherwise. (f) Tenant may, from time to time, replace any existing Letter of Credit with a new Letter of Credit if the new Letter of Credit: (1) becomes effective at least sixty (60) days before expiration of the Letter of Credit that it replaces; (2) is in the required Letter of Credit amount; (3) is issued by a Letter of Credit bank acceptable to Landlord; and (4) otherwise complies with the requirements of this Section 17.07(ii). (g) Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal ~~thereof~~ or ~~substitute therefor or Cash Collateral be:~~ proceeds of it be (e1) deemed to be or treated as a “security deposit” within the meaning of California Civil Code ~~Section~~ §1950.7; , (f2) subject to the terms of ~~such Section~~ §1950.7~~; or~~ , (g3) intended to serve as a “security deposit” within the meaning of ~~such Section 1950~~§1950.7, or (4) limit Landlord’s remedies hereunder. Landlord and Tenant (x) confirm that the Letter of Credit is not intended to serve as a security deposit and §1950.7 and any and all other laws, rules, and regulations applicable to security deposits in the commercial context (“Security Deposit Laws”) shall have no applicability or relevancy to the Letter of Credit and (y) waive any and all rights, duties, and obligations either party may now or in the future have relating to or arising from the Security Deposit Laws.

Appears in 1 contract

Samples: Office Lease Agreement (Splunk Inc)

Letter of Credit. ~~Within forty-five (45) days after~~ Sublessee, at Sublessee's sole cost and expense, shall provide a letter of credit in the ~~mutual execution and delivery~~ amount of ~~this Lease, Tenant shall deliver to Landlord, as collateral~~ $60,000.00 for the first two full ~~and faithful performance by Tenant~~ years of ~~all of its obligations~~ the Sublease In the event Sublessee defaults, or has defaulted on any monetary obligation under this ~~Lease~~Sublease (Monetary Default) in the first two (2) years of the Term hereof, Sublessee shall maintain a letter of credit in the amount of $60,000.00 for a period extending two full years from the last date upon which Sublessee Monetary Default has occurred. The letter of credit shall be in the form of an ~~irrevocable~~ irrevocable, unconditional, and ~~unconditional negotiable~~ clean letter of credit, payable at sight and upon demand, in form and substance acceptable to Sublessor in its sole and absolute discretion, from Citibank, N.A., Bank of America, N.A. or Xxxxx Fargo Bank, N.A. or another national bank acceptable to Sublessor with offices in San Francisco or Marin, County, California that will accept and pay on any draw on said letter of credit (~~the “~~"Letter of Credit”"), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall ~~be:~~ designate Sublessor as beneficiary and shall be transferable by beneficiary to any transferee, successor, and assign (aincluding any lender of Sublessor) at ~~sight and irrevocable; (b) maintained in effect for the entire period from the date~~ no cost or expense to beneficiary. The letter of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit credit shall be ~~no earlier than the Letter~~ for a minimum period of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, two years Sublessor shall have the right to draw ~~down an amount up to the face amount of~~ (in whole or in part) on the Letter of Credit ~~upon~~ any time it would otherwise have the ~~presentation~~ right to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from apply all ~~liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole~~ or any portion of ~~said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part~~ the Security Deposit under the terms of the ~~Letter of Credit~~Sublease. However, ~~the amount of~~ the Letter of Credit shall provide that it may be ~~less than~~ drawn by Sublessor (or assignee) upon presentation by Sublessor to the ~~LC Amount~~issuing bank (at its offices in San Francisco or Marin, ~~Tenant shall~~County, ~~within ten (10) business days thereafter, provide Landlord with an additional letter(s~~California) of ~~credit~~a sight draft(s), ~~in an~~ together with a statement from Sublessor that the amount ~~equal~~ requested by Sublessor is due and owing to Sublessor and shall be payable by the ~~deficiency (~~bank without inquiry or ~~a replacement letter of credit in the total amount~~ any other documentation or further action required of the ~~LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27~~bank, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of CreditSublessor, or ~~any part thereof~~ Sublessee. All costs and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if expenses to obtain the Letter of Credit ~~expires earlier than~~ and all renewals shall be borne by Sublessee. Notwithstanding the ~~Lease Expiration Date~~foregoing, ~~Landlord will accept a renewal letter of credit or substitute letter of credit~~ in the event Sublessee has not been in default hereunder during the first two (~~such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30~~2) ~~days prior to the expiration~~ full years of the Sublease Term, Sublessee's obligation to maintain a Letter of Credit ~~or amendment), which~~ for the benefit of Sublessor shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950terminate.

Appears in 1 contract

Samples: Sublease Agreement (Seachange International Inc)

Letter of Credit. 21.1 Within ~~forty-five~~ fifteen (4515) days ~~after~~ of the ~~mutual~~ full execution and delivery of this ~~Lease~~Lease by Landlord and Tenant, Tenant shall deliver to Landlord an unconditional, irrevocable and renewable letter of credit (“Tenants Letter of Credit”) in favor of Landlord in the form attached hereto as Exhibit “E”, issued by a bank reasonably acceptable to Landlord with an office (capable of honoring a demand on the Tenant’s Letter of Credit) located in Southern California, in the principal amount (“Stated Tenant LC Amount”) specified below, as security for the faithful performance and observance by Tenant of the terms, provisions and conditions of this Lease. Tenant shall pay all expenses, points and/or fees incurred by Tenant in obtaining the Tenant’s Letter of Credit; provided, however, that so long as Tenant is not then in default under this Lease beyond any applicable notice and cure periods, Landlord shall reimburse such expenses, points and/or fees incurred by Tenant in obtaining Tenant’s Letter of Credit, up, to a maximum amount equal to three-quarter percent (0.75%) of the then Stated Tenant LC Amount per year (“LC Reimbursement Cap”) within thirty (30) days of Tenant’s presentation to Landlord of evidence reasonably satisfactory to Landlord evidencing such expenses, points and/or fees paid by Tenant. The Stated Tenant LC Amount of the Tenant’s Letter of Credit shall initially be [ ] [ ] [ ] [ ] ] provided, however that subject to the terms hereof, the Stated Tenant LC Amount shall be reduced by an amount equal to [ ] [ ] [ ] [ ] [ ][ ] on each annual anniversary of the Commencement Date but in no event shall the Stated Tenant LC Amount ever be reduced to an amount less than [ ] [ [ ] [ ] [ ] [ ] ] (the “Minimum Stated Tenant LC Amount”). Accordingly, upon the dates specified below (“Adjustment Dates”), the Tenant LC Stated Amount may, subject to the terms hereof, be reduced to the following amounts: Adjustment Dates Tenant LC Stated Amount Commencement Date: [ ] Last day of the month in which the twelve (12) month anniversary of the Commencement Date occurs: [ ] Last day of the month in which the twenty-four (24) month anniversary of the Commencement Date occurs: [ ] Last day of the month in which the thirty-six (36) month anniversary of the Commencement Date occurs: [ ] Last day of the month in which the forty-eight (48) month anniversary of the Commencement Date occurs: [ ] Last day of the month in which the Sixty (60) month anniversary of the Commencement Date occurs: [ ] Last day of the month in which the seventy-two (72) month anniversary of the Commencement Date occurs: [ ] Last day of the month in which the eighty-four (84) month anniversary of the Commencement Date occurs and continuing, subject to Section 25.26 hereof, for the balance of the Term (including any Option Term (if any)): [ ] Notwithstanding anything above to the contrary, if Tenant is in default under this Lease and Tenant has received notice but failed to cure such default within the time period permitted under this Lease or such lesser time as may remain before the relevant date for any scheduled reduction of the Stated Amount as provided above, the Stated Amount shall not thereafter be reduced, unless and until such default shall have been fully cured pursuant to the terms of this Lease, at which time the Stated Amount may be reduced as hereinabove described. 21.2 The Tenant’s Letter of Credit shall be held by Landlord, as ~~collateral~~ security for the ~~full and~~ faithful performance by Tenant of all of ~~its obligations under this Lease~~the terms, ~~an irrevocable~~ covenants and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution conditions of this Lease. ~~The~~ If Tenant commits a default with respect to any provision of this Lease or if the term of the Tenant’s Letter of Credit ~~shall be:~~ held by Landlord is scheduled to expire prior to the last day of the Lease Term (~~a) at sight~~ including any renewal or extension thereof), and ~~irrevocable; (b) maintained in effect for~~ the ~~entire period from~~ term of the ~~date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“~~Tenant’s Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is ~~otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord~~ not extended at least thirty (30) days prior to the scheduled date of expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of LandlordTenant’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, ~~in whole~~ Landlord may (but shall not be required to) draw upon all or ~~in part to~~ a portion of the ~~transferee and thereupon~~ principal amount of the ~~Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor~~Tenant’s Letter of Credit, and ~~it is agreed that the provisions hereof shall~~ Landlord may then use, apply ~~to every transfer~~ or ~~assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of~~ retain all or any part of the ~~Letter~~ proceeds from such drawn principal amount as Landlord determines may be reasonably necessary for the payment of ~~Credit~~any sum which is in default, or for the payment of any other amount which Landlord may spend or become obligated to spend by reason of ~~the~~ Tenant’s default or to compensate Landlord for any loss or damage which Landlord may suffer by reason of Tenant’s default; provided, however; that Landlord shall provide Tenant with fifteen (15) days prior written notice before Landlord draws upon Tenant’s Letter of Credit ~~shall be less than~~ on account of Tenant’s failure to extend Tenant’s Letter of Credit at least thirty (30) days prior to the ~~LC Amount,~~ scheduled date of expiration thereof. If any portion of the Tenant’s Letter of Credit proceeds is so used or applied as provided above; Tenant shall, within ten (10) ~~business~~ days ~~thereafter~~after demand therefor, ~~provide Landlord with~~ post an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the ’s Letter of Credit in an amount to cause the aggregate amount of the unused proceeds and ~~in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the~~ such new Tenant’s Letter of Credit to equal the ~~issuing bank~~ Stated Tenant LC Amount required in ~~accordance with the terms~~ Section 21.1. Landlord acknowledges and agrees that any Unused proceeds from Tenant’s Letter of ~~this Article 27, and the entire sum evidenced thereby~~ Credit shall be ~~paid~~ deemed to constitute a security deposit and ~~held~~ shall be retained by Landlord as ~~cash (the “Cash Collateral”) to be held as collateral~~ a security for Tenant’s faithful performance ~~of all~~ of Tenant’s obligations under this Lease ~~and for all losses and damages Landlord may suffer as a result of any default by~~ but shall, upon Tenant ~~under this Lease pending~~ posting an additional Tenant’s ~~delivery to Landlord~~ Letter of Credit (in the amount of the ~~required replacement letter of credit in the~~ then applicable Stated Tenant LC ~~Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of~~ Amount), return such ~~replacement letter of credit, any Cash Collateral held by Landlord shall be returned~~ unused proceeds to ~~Tenant~~Tenant within ten (10) days thereafter. Landlord shall ~~have~~ not be required to keep any proceeds from the ~~right to hold Cash Collateral in a deposit account in the name~~ Tenants Letter of ~~Landlord and commingle the Cash Collateral with~~ Credit separate from its general ~~assets and Tenant hereby grants~~ funds. Should Landlord ~~a security~~ sell its interest in the ~~Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under~~ Premises during the Lease ~~beyond all applicable notice~~ Term and ~~cure periods,~~ if Landlord ~~may, but without obligation to do so, draw upon~~ deposits with the purchaser thereof the Tenant’s Letter of Credit ~~and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure~~ and any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Tenant’s Letter of Credit, ~~either prior to or following a “draw” by~~ thereupon Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be ~~deemed~~ discharged from any further liability with respect to ~~render~~ the Tenant’s Letter of Credit ~~conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord~~ and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950said proceeds.

Appears in 1 contract

Samples: Sublease (Celladon Corp)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution~~ 4.1 In order to secure ICC's obligations under Sections 2.4 and 3.2 of this Agreement and to ensure timely delivery of ~~this Lease~~any and all payments due from ICC thereunder, ~~Tenant~~ ICC shall ~~deliver~~ establish with Mellon Bank, N.A. (the "Bank"), no later than April 19, 1995, and maintain with said Bank (or any other bank acceptable to ~~Landlord~~Engelhard should the Bank not extend the then existing letter of credit) during the period the Loan Agreement is effective, ~~as collateral for the full~~ a clean and ~~faithful performance by Tenant of all of its obligations under this Lease, an~~ irrevocable ~~and unconditional negotiable~~ letter of credit ~~(the “Letter~~ in favor of ~~Credit”), substantially~~ Engelhard in the form attached hereto as Exhibit ~~G hereto and made a part hereof, and containing the terms required herein, payable~~ B in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial principal amount of $~~[***] (“LC Amount”)~~2,500,000. ~~Tenant~~ ICC shall ~~provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit~~ be responsible and liable for, and shall ~~be: (a) at sight~~ pay, any and ~~irrevocable; (b) maintained~~ all costs and expenses incurred in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of establishing and/or maintaining the Letter of Credit provided hereunder and Engelhard shall be have no ~~earlier than~~ responsibility and/or liability therefor. 4.2 Every draw by Engelhard under the Letter of Credit ~~Termination Date~~ pursuant to Section 2.4 and/or 3.2 shall be made by Engelhard by 5 right and without notice to ICC, by presentation to the Bank, at any time after the time on which Engelhard paid any Payment Deficiency in the case of Section 2.4 or ~~provide for automatic renewal thereof~~ at ~~least through~~ any time after the time on which Engelhard rendered payment under the Guaranty in the case of Section 3.2, of a sight draft under the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices provided hereunder for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the ~~Letter~~ amount which ICC was required to remit as aforesaid, accompanied by a certificate of ~~Credit~~the Treasurer or Assistant Treasurer of Engelhard to the effect that such payment has been made in the form attached hereto as Annex A to Exhibit B. Promptly after the giving of such certificate to the Bank, Engelhard shall send a copy of such certificate to ICC by facsimile transmission. 4.3 If from time to time during the term of this Agreement Engelhard should determine that ICC's share, through ICC Desiccant Technologies, Inc., of the total liability of Engelhard/ICC and Engelhard under the Loan Agreement and the Guaranty Agreement, respectively, is less than the then total principal amount of the ~~Letter~~ then existing Letters of Credit and, if applicable, the security instruments and/or other arrangements provided under Section 4.1, then in such case Engelhard shall ~~be less than~~ so notify ICC and shall direct the ~~LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal~~ Bank to ~~the deficiency (or a replacement letter of credit in~~ reduce the total principal amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter Letters of Credit to ICC's share of the ~~issuing bank in accordance with~~ total liability then determined by Engelhard to be applicable under the ~~terms of this Article 27,~~ Loan Agreement and the ~~entire sum evidenced thereby shall be paid to and held by Landlord as cash (~~Guaranty Agreement. Promptly after the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery giving of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice ~~and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole,~~ to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s defaultBank, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following Engelhard shall send a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms copy of such ~~Section 1950.7; or (g) intended~~ notice to ~~serve as a “security deposit” within the meaning of such Section 1950~~ICC by facsimile transmission.

Appears in 1 contract

Samples: Agreement (Icc Technologies Inc)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution and delivery of this Lease,~~ Tenant shall deliver to Landlord, ~~as collateral for the full and faithful performance by Tenant~~ within 30 days following Tenant’s execution of ~~all of its obligations under~~ this Lease, ~~an irrevocable and unconditional negotiable~~ a letter of credit in the amount of $1,650,000.00 (~~the~~ “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen which Letter of Credit ~~from~~ shall be in form and with the ~~approved issuer~~ substance of Exhibit I attached hereto. Within 10 business days after the Early Delivery Condition or Delivery Condition, as applicable, has been achieved and prior to the ~~execution~~ commencement of ~~this Lease~~construction of the “Tenant Improvements” (as defined in the Work Letter), Tenant shall cause the principal amount of the Letter of Credit to be increased by $5,000,000.00 to $6,650,000.00 and shall deliver to Landlord documents satisfactory to Landlord evidencing such increase. The Letter of Credit shall ~~be:~~ be issued by a financial institution in the United States reasonably acceptable to Landlord with a branch in Santa Xxxxx County, California or by a financial institution reasonably acceptable to Landlord that will honor draws sent by nationally recognized overnight courier, at which draws on the letter of credit will be accepted. Landlord hereby approves Silicon Valley Bank as an acceptable financial institution for issuance of the Letter of Credit. Upon any Default by Tenant, Landlord shall be entitled to draw upon said Letter of Credit by the issuance of Landlord’s written demand to the issuing financial institution, which draw shall be in an amount necessary to cure the Default in question and to compensate Landlord for all damages incurred thereby, as reasonably determined by Landlord in its sole but reasonable discretion, and if such amount cannot be readily determined by Landlord, then the full amount of the Letter of Credit can be drawn by Landlord pending determination of said amount. Notwithstanding the foregoing, while the amount of any such draw shall be determined in Landlord’s sole but reasonable discretion as provided in the foregoing, if the amount of any such draw(s) shall ultimately exceed the amount of damages actually incurred by Landlord as the result of Tenant’s Default (a) as determined pursuant to the applicable provisions of Article 14 of this Lease), then Landlord shall promptly refund any such excess to Tenant. Any such draw shall be without waiver or any rights Landlord may have under this Lease or at ~~sight and irrevocable; (b) maintained~~ law or in ~~effect~~ equity as a result of the Default, as a setoff for full or partial compensation for the ~~entire period from~~ Default. If any portion of the Letter of Credit is drawn after a Default by Tenant, Tenant shall within 10 business days receipt of after written demand by Landlord restore the Letter of Credit to the required amount. Failure to so restore said Letter of Credit within said 10 business days shall be a Default by Tenant under this Lease. Partial drawings upon said Letter of Credit shall be permitted. The Letter of Credit shall provide for automatic annual renewals through that date which is 60 days after the Expiration Date of ~~execution~~ the Term of this Lease ~~through~~ (including any extensions of the ~~date which is sixty (60) days following~~ Term as provided in this Lease). In the ~~Termination Date (“~~event the Letter of Credit ~~Expiration Date”), subject~~ is not renewed by the issuing financial institution on or before 30 days prior to the ~~last paragraph of this Article 27, provide that the~~ then-scheduled expiration date of the Letter of ~~Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date~~Credit, ~~unless the issuing bank provides at least thirty (30) days prior written notice to~~ then Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw the full amount of such Letter of Credit and to hold such amount as cash security for Tenant’s full and faithful performance of its obligations under the Lease. In the event of a draw down ~~an amount up to the face amount~~ of the Letter of Credit to cash security as provided in the foregoing, the following shall apply: (i) upon ~~the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing~~ any Default by Tenant under this Lease, including specifically Tenant’s failure to pay rent or to abide by its obligations under Sections 7.1 and 15.2 below, notwithstanding any contrary provision of California Civil Code Section 1950.7, Landlord may retain, use or apply so much of the cash security to pay any sum which Tenant is obligated to pay under this Lease, including without limitation, amounts estimated by Landlord as the amounts due it ~~being understood~~ for prospective rent and for damages pursuant to Section 14.2(a)(i) of this Lease and/or California Civil Code Section 1951.2, sums that if Landlord may spend or ~~its managing agent~~ be ~~a corporation, partnership or other entity, then such statement shall be signed~~ required to expend by ~~an officer (if a corporation), a general partner (if a partnership),~~ reason of the default by Tenant or any ~~authorized party (if another entity);~~ loss or damage that Landlord may suffer by reason of such default or costs incurred by Landlord in connection with the repair or restoration of the Premises pursuant to Section 15.2 upon expiration or earlier termination of this Lease, (ii) Landlord shall not be required to keep the ~~Letter of Credit will~~ cash security separate from its general funds and Tenant shall not be ~~honored by the issuing bank without inquiry as~~ entitled to ~~the accuracy thereof~~ interest on such cash security, and ~~regardless of whether the Tenant disputes the content of such statement; and~~ (iii) if Tenant fully performs its obligations under this Lease, the cash security shall be returned to Tenant (or, at Landlord’s option, to the last assignee of Tenant’s interest under the Lease) within thirty (30) days after the expiration of the Term, provided that Tenant agrees that Landlord may retain the cash security to the extent and until such time as all amounts due from Tenant in accordance with this Lease have been determined and paid in full and Tenant agrees that Tenant shall have no claim against Landlord for Landlord’s retaining the cash security to the extent provided in the ~~event of a transfer of Landlord’s interest~~ foregoing. Notwithstanding anything contained in this Section 4.4 to the ~~Building~~contrary, if Landlord ~~shall transfer~~ draws on the Letter of Credit, ~~in whole or in part~~ then Tenant shall have the right, upon ten (10) days’ prior written notice to ~~the transferee~~ Landlord and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment following Landlord’s receipt of the ~~whole or any portion of said~~ replacement Letter of Credit described below, to obtain a ~~new landlord. If, as a result~~ refund from Landlord of any ~~application or use by Landlord of all or any part of the Letter of Credit, the amount~~ unapplied cash proceeds of the Letter of Credit ~~shall be less than the LC Amount~~which Landlord has drawn upon, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such ~~additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails~~ refund being conditioned upon Tenant simultaneously delivering to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord ~~nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the~~ a new replacement Letter of Credit ~~expires earlier than~~ in the ~~Lease Expiration Date~~amount then required, and otherwise meeting the requirements contained in this Section 4.4. Landlord will ~~accept~~ authorize in writing a ~~renewal letter~~ reduction in the principal amount of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount of $3,325,000.00 on the first day of the 19th full month of the Term, provided that, as of the date of such reduction, (1) no Default has occurred under any provision of this Lease at any time during the Term and ~~in accordance~~ no event or circumstance shall have occurred, which with the ~~terms set forth in this Article 27~~passage of time or giving of notice, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations could constitute a Default under this Lease as of such date, and ~~for all losses and damages Landlord may suffer as a result~~ (2) Tenant has not been more than five (5) days late with respect to any payments of ~~any default by Tenant~~ rent due under this Lease ~~pending Tenant’s delivery to~~ more than twice during the preceding eighteen (18) months. In addition, Landlord ~~of the required replacement letter of credit~~ will authorize an additional reduction in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer principal amount of the Letter of Credit in ~~failing to honor a drawing upon such~~ the amount of $3,325,000.00 (in which case the resulting Letter of Credit ~~in a timely manner. Landlord~~ amount shall be zero and ~~Tenant acknowledge~~ the Letter of Credit shall be cancelled), so that, commencing on the first day of the 49th full month of the Term (and ~~agree~~ continuing thereafter at any time that in all of the following conditions have been met), as of the date of such reduction, (1) no Default has occurred under any provision of this Lease at any time during the Term and no event or circumstance shall have occurred, which with the ~~Letter~~ passage of ~~Credit~~ time or ~~any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated~~ giving of notice, could constitute a Default under this Lease as ~~a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms~~ of such ~~Section 1950.7; or~~ date, (g2) ~~intended~~ Tenant has not been more than five (5) days late with respect to ~~serve~~ any payments of rent due under this Lease more than twice during the Term, and (3) Tenant shall have provided Landlord or filed with the Securities and Exchange Commission audited financial statements showing revenue of not less than One Billion Dollars ($1,000,000,000.00) and free cash flow of not less than Two Hundred Million Dollars ($200,000,000.00) for the calendar year immediately preceding such final reduction. Free cash flow is defined as ~~a “security deposit” within the meaning of such Section 1950~~net cash provided by operating activities minus capital expenditures.

Appears in 1 contract

Samples: Lease (Proofpoint Inc)

Letter of Credit. In consideration of Landlord entering into this Lease, Tenant hereby agrees as follows: (a) Within ~~forty-five~~ ten (4510) business days after the ~~mutual execution and delivery~~ date of this Lease, Tenant shall deliver to Landlord, as ~~collateral~~ additional security for the ~~full and faithful performance by~~ obligations of Tenant ~~of all of its obligations~~ under this Lease, an unconditional, irrevocable ~~and unconditional negotiable~~ standby letter of credit issued by Columbus Bank & Trust (~~the “Letter of Credit”~~or such other bank as Landlord and Tenant may otherwise agree) ("Issuer"), ~~substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running~~ in favor of Landlord, ~~issued by~~ in the amount of EIGHT MILLION AND NO/100 DOLLARS ($8,000,000.00) (a ~~solvent bank reasonably approved by Landlord under~~ "Standby Letter of Credit") in substantially the ~~supervision~~ form attached hereto as Exhibit K, subject to modifications therein to conform to the terms of this Section 22. The term of the ~~Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen~~ original Standby Letter of Credit ~~from~~ required under this Section 22 shall commence as of the ~~approved issuer prior to the execution~~ Date of this ~~Lease~~Lease and shall expire no earlier than November 30, 2000. The expiration date of the Standby Letter of Credit shall bebe clearly stated on its face by month, day and year. The Standby Letter of Credit shall be payable by sight draft in the office of Issuer when accompanied by a certificate (the "Certificate") signed by an authorized representative of Landlord certifying either that: (ai) ~~at sight~~ Tenant is in Default under this Lease (beyond all applicable notice and ~~irrevocable;~~cure periods provided to Tenant under this Lease) with respect to the payment of Rent due and payable by Tenant to Landlord under this Lease, and that Landlord has the right under this Lease to receive the amount of the requested draw pursuant to the provisions of this Lease, or (bii) ~~maintained~~ Tenant has filed a petition in ~~effect for the entire period from the date of execution of this Lease through the date which is~~ bankruptcy or that an involuntary petition in bankruptcy has been filed against Tenant (and such involuntary petition has not been dismissed within sixty (60) days ~~following~~ after filing), and that Tenant is not making or has not made any one or more payments of Rent due and payable by Tenant to Landlord under this Lease when due pursuant to this Lease (beyond all applicable notice and cure periods provided to Tenant under this Lease). A copy of the ~~Termination Date~~ Certificate shall be sent to Tenant in accordance with the notice provisions of Section 25 of this Lease not less than five (“5) business days before the presentment of the Certificate and the sight draft to Issuer. The Issuer may rely on the Certificate without independent verification. The Standby Letter of Credit ~~Expiration Date”), subject~~ shall permit partial draws up to the ~~last paragraph~~ full amount thereof. (b) Tenant may contest Landlord's right to make a draw upon the Standby Letter of ~~this Article 27~~Credit by filing a claim with the Atlanta, ~~provide that the expiration date~~ Georgia office of the American Arbitration Association pursuant to Exhibit J hereto; provided, however, that no such claim may be filed if the Default serving as the basis for the subject draw is a failure to pay Base Rent or Additional Rent under this Lease. With respect to any other Defaults which are not based on Tenant's failure to pay Base Rent or Additional Rent under the Lease, if a claim is properly filed by Tenant and Tenant notifies Landlord within five (5) business days of Landlord's notice of such draw that Tenant intends to contest Landlord's right to make such draw, Landlord shall not be entitled to draw upon the Standby Letter of Credit pursuant to the Certificate giving rise to such claim unless and until such claim has been resolved in Landlord's favor pursuant to binding arbitration in accordance with Exhibit J. (c) The Standby Letter of Credit shall be ~~no earlier than~~ renewed annually automatically or otherwise shall be replaced annually with a new letter of credit issued by the ~~Letter of Credit Termination Date or provide for automatic renewal thereof~~ Issuer obtained by Tenant at ~~least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice~~ Tenant's cost and delivered to Landlord ~~of such non-renewal by certified mail, return receipt requested at~~ on or before the ~~address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as~~ date which is ~~otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least~~ thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.the

Appears in 1 contract

Samples: Office Lease Agreement (S1 Corp /De/)

Letter of Credit. ~~Within forty-five~~ (45a) The Letter of Credit for the Security Deposit shall (i) provide by its terms that it may be drawn in Orange County, California, (ii) be issued by a bank approved by Landlord in accordance with Section 4.02(c) below, which satisfies the LC Issuer Requirements, (iii) be clean, unconditional, transferable, and irrevocable, (iv) contain “evergreen provisions” requiring annual automatic renewal with a final expiration date no earlier than sixty (60) days after the ~~mutual execution~~ end of the Lease Term, as the same may be extended (including during any holding over by Tenant) (the “LC Expiration Date”), (v) have an initial expiration date not sooner than twelve (12) months from the issuance thereof, (vi) otherwise be in the form and ~~delivery~~ content identical to the form attached to this Lease as Exhibit J, and (vii) in any event, be subject to Landlord’s prior written approval (as determined in Landlord’s sole and absolute discretion). Except with the express written approval of ~~this Lease~~Landlord, which approval may be given or withheld by Landlord for any reason or no reason at any time or from time to time in the sole, absolute and unfettered discretion of Landlord, Tenant may not be the applicant (as defined in Article 5 of the UCC) for any Letter of Credit nor otherwise be liable in any manner, or to any extent, to reimburse proceeds of any Letter of Credit. (b) Tenant shall keep the Letter of Credit in full force and effect at all times during the Lease Term, as the same may be extended and through and including the LC Expiration Date. If, at any time prior to the end of the Lease Term, (i) the Letter of Credit then held by Landlord would by its terms expire, or (ii) the issuer shall notify Landlord that the Letter of Credit then held by Landlord will not be renewed, Tenant shall deliver a replacement letter of credit to ~~Landlord~~Landlord in form and content identical to the Letter of Credit except as to expiration and renewal dates and otherwise acceptable to Landlord in its sole and absolute discretion not later than sixty (60) days prior to the expiration of the then current Letter of Credit. Tenant shall be responsible for obtaining such replacement Letter of Credit at its sole expense. If Tenant shall fail to deliver a replacement letter of credit in strict accordance with the foregoing requirements, Landlord shall thereupon be authorized, without notice to Tenant or providing any opportunity to cure to Tenant, each and all of which are hereby irrevocably waived, to immediately draw the entire amount then remaining available under the Letter of Credit. (c) The Letter of Credit shall be issued by a commercial bank acceptable to Landlord in its sole and absolute discretion (i) that is chartered under the laws of the United States, any State thereof or the District of Columbia, and which maintains deposits insured by the Federal Deposit Insurance Corporation; and (ii) whose long-term, unsecured and unsubordinated debt obligations are rated “investment grade” by Xxxxx’x Investors Service, Inc. (Moody’s) or Standard & Poor’s Ratings Services (S&P) or their respective successors (the “Rating Agencies”) (which shall mean Baa3 or higher by Moody’s and BBB- or higher by Standard & Poor’s), or, if not rated by the Rating Agencies, having a BauerFinancial, Inc. rating of at least four (4) stars (collectively, the “LC Issuer Requirements”). If at any time the LC Issuer Requirements are not met, or if the financial condition of such issuer changes in any other materially adverse way, as ~~collateral~~ determined by Landlord in its sole and absolute discretion, Tenant shall, within five (5) business days after transmittal of written notice by Landlord to Tenant, deliver to Landlord a replacement Letter of Credit in form and content identical to the Letter of Credit issued by a bank that then satisfies the LC Issuer Requirements (and Tenant’s failure to do so shall, notwithstanding anything in this Lease to the contrary, constitute a Default for which there shall be no notice or grace or cure periods being applicable thereto other than the aforesaid five-day period). In addition to and not in limitation or derogation of all rights and remedies accorded to Landlord upon the occurrence of a Default under this Lease and/or by applicable law, Landlord shall thereupon be authorized, without notice to Tenant or providing any opportunity to cure to Tenant, each and all of which are hereby irrevocably waived, to immediately draw the entire amount then remaining available under the Letter of Credit. (d) If the issuer of any Letter of Credit held by Landlord is insolvent or is placed into receivership or conservatorship by the Federal Deposit Insurance Corporation, or any successor or similar entity, or if a trustee, receiver or liquidator is appointed for the ~~full~~ issuer, then, effective as of the date of such occurrence, said Letter of Credit shall be deemed to not satisfy the LC Issuer Requirements, and Tenant shall, within five (5) business days after transmittal of written notice by Landlord to Tenant, (i) deposit with Landlord in an amount equal to the LC Amount or (ii) deliver to Landlord a replacement Letter of Credit in form and content identical to the Letter of Credit issued by a bank that then satisfies the LC Issuer Requirements (and Tenant’s failure to do so shall, notwithstanding anything in this Lease to the contrary, constitute a Default for which there shall be no notice or grace or cure periods being applicable thereto other than the aforesaid five business-day period). (e) In the event of the occurrence of a Default, in addition to and not in limitation or derogation of any or all of its other remedies contained in this Lease and/or applicable law, Landlord shall have the right (but not the obligation) to immediately draw all or any part of the amount then remaining available under the Letter of Credit. In the event of any such draw, Tenant shall forthwith provide Landlord with an additional letter of credit in an amount sufficient to restore the aggregate amounts of the Letter(s) of Credit held by Landlord to the LC Amount. (f) Landlord may use or apply the whole or any part of the amounts drawn on the Letter of Credit (the “LC Proceeds”) for the payment of any of Tenant’s obligations under this Lease. At Landlord’s election, any LC Proceeds not otherwise applied to amounts then due Landlord shall be held to secure the prompt, full, and faithful payment and performance by Tenant of each and all of the obligations of Tenant under this Lease. Tenant’s obligation to furnish the Letter of Credit and any use, application or retention by Landlord of all or any part of the LC Proceeds shall not be deemed in any way to constitute liquidated damages for any default by Tenant, or to limit the remedies to which Landlord is otherwise entitled under the terms of this Lease and/or applicable law. In the event the LC Proceeds are reduced below the LC Amount by any such use or application, Tenant shall deposit with Landlord, within ten (10) days after notice, an amount sufficient to restore the amount of the LC Proceeds to the LC Amount. Landlord shall not be required to keep the LC Proceeds separate from Landlord’s general funds or pay interest on the LC Proceeds. Provided Tenant has performed all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision any remaining portion of the ~~Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“~~LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit Proceeds shall be ~~no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least~~ returned to Tenant within thirty (30) days ~~prior written notice to~~ after the LC Expiration Date. No trust or fiduciary relationship is created herein between Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, and Tenant ~~shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior~~ with respect to the ~~expiration of the Letter of Credit without any action whatsoever on the part of Landlord;~~LC Proceeds. (cg) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the ~~Building~~Premises, Landlord shall have the right to transfer the Letter of ~~Credit, in whole or in part~~ Credit and/or any LC Proceeds to the transferee and Landlord shall thereupon ~~the Landlord shall,~~ and without any further agreement between the parties, be forever released by Tenant from all liability ~~therefor~~therefor (including, without limitation, from all liability for the return of the LC Proceeds), and it is agreed that the provisions hereof shall apply to every transfer ~~or assignment of the whole or any portion~~ of said Letter of Credit to a new landlord~~. If, as a result of any application or use by~~ . (h) Landlord ~~of all or any part of the Letter of Credit, the amount of~~ shall return the Letter of Credit ~~shall be less than the LC Amount,~~ to Tenant ~~shall,~~ within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days ~~prior~~ following the expiration of the Lease Term; provided however, no such return shall be required if Tenant shall have failed to perform each and all of its obligations under the Lease as and when required under the terms of the Lease, without regard to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice ~~and~~ or cure periods, ~~Landlord may, but~~ and without ~~obligation~~ regard to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of whether a Default then exists under this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Industrial Building Lease (Real Good Food Company, Inc.)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after~~ Subject to and upon the ~~mutual execution~~ terms and ~~delivery of this Lease, Tenant shall deliver to Landlord, as collateral for the full~~ conditions contained herein and ~~faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially~~ in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit ~~from~~ Documents, at the ~~approved issuer prior~~ request of a Borrower (or Administrative Borrower on behalf of such Borrower), Agent agrees to cause Issuing Bank to issue, and Issuing Bank agrees to issue, for the ~~execution~~ account of such Borrower one or more Letters of Credit, for the ratable risk of each Lender according to its Pro Rata Share, containing terms and conditions acceptable to Agent and Issuing Bank. From and after the Closing Date, all Existing Letters of Credit outstanding on the Closing Date shall be deemed to be issued and outstanding, and to constitute Letters of Credit, under this ~~Lease. The~~ Agreement and all Letter of Credit Accommodations (as defined in the Existing Loan Agreements) outstanding on the Closing Date shall ~~be: (a) at sight~~ be deemed to be and ~~irrevocable;~~constitute Letter of Credit Obligations under this Agreement, and shall be subject to all of the terms and conditions hereof. (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of The Borrower requesting such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (~~and the bank issuing the same~~or Administrative Borrower on behalf of such Borrower) shall give Agent and Issuing Bank two (2) Business Days' prior written notice of such Borrower's request for the issuance of a Letter of Credit. Such notice shall be ~~acceptable to Landlord, in Landlord’s reasonable discretion,~~ irrevocable and shall ~~provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have~~ specify the ~~right to draw down an amount up to the~~ original face amount of the Letter of Credit ~~upon~~ requested, the ~~presentation~~ effective date (which date shall be a Business Day and in no event shall be a date less than ten (10) days prior to the ~~issuing bank~~ end of ~~Landlord’s~~ the then current term of this Agreement) of issuance of such requested Letter of Credit, whether such Letter of Credit may be drawn in a single or in partial draws, the date on which such requested Letter of Credit is to expire (~~or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent~~ which date shall be a ~~corporation, partnership or other entity, then such statement~~ Business Day and shall not be ~~signed by an officer (if a corporation~~more than one year from the date of issuance), ~~a general partner (if a partnership)~~the purpose for which such Letter of Credit is to be issued, ~~or any authorized party (if another entity); (ii)~~ and the beneficiary of the requested Letter of Credit. The Borrower requesting the Letter of Credit ~~will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content~~ (or Administrative Borrower on behalf of such ~~statement; and (iii~~Borrower) in shall attach to such notice the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part proposed terms of the Letter of Credit. The renewal or extension of any Letter of Credit shall, for purposes hereof be treated in all respects the ~~amount~~ same as the issuance of a new Letter of Credit hereunder. (c) In addition to being subject to the satisfaction of the applicable conditions precedent contained in Section 4 hereof and the other terms and conditions contained herein, no Letter of Credit shall be available unless each of the following conditions precedent have been satisfied in a manner satisfactory to Agent: (i) the Borrower requesting such Letter of Credit (or Administrative Borrower on behalf of such Borrower) shall have delivered to Issuing Bank at such times and in such manner as Issuing Bank may require, an application, in form and substance satisfactory to Issuing Bank and Agent, for the issuance of the Letter of Credit and such other Letter of Credit Documents as may be required pursuant to the terms thereof, and the form and terms of the proposed Letter of Credit shall be ~~less than~~ satisfactory to Agent and Issuing Bank, (ii) as of the ~~LC Amount~~date of issuance, ~~Tenant shall~~no order of any court, arbitrator or other Governmental Authority shall purport by its terms to enjoin or restrain money center banks generally from issuing letters of credit of the type and in the amount of the proposed Letter of Credit, and no law, rule or regulation applicable to money center banks generally and no request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over money center banks generally shall prohibit, or request that Issuing Bank refrain from, the issuance of letters of credit generally or the issuance of such Letter of Credit, (iii) after giving effect to the issuance of such Letter of Credit, the Letter of Credit Obligations shall not exceed the Letter of Credit Limit, and (iv) the Excess Availability, prior to giving effect to any Reserves with respect to such Letter of Credit, on the date of the proposed issuance of any Letter of Credit shall be equal to or greater than: (A) if the proposed Letter of Credit is for the purpose of purchasing Eligible Inventory and the documents of title with respect thereto are consigned to Issuing Bank, the sum of (1) the percentage equal to one hundred percent (100%) minus the then applicable percentage with respect to Eligible Inventory set forth in the definition of the term Borrowing Base multiplied by the Value of such Eligible Inventory, plus (2) freight, taxes, duty and other amounts which Agent estimates must be paid in connection with such Inventory upon arrival and for delivery to one of such Borrower's locations for Eligible Inventory within ~~ten~~ the United States of America and (10B) ~~business days thereafter~~if the proposed Letter of Credit is for any other purpose or the documents of title are not consigned to Issuing Bank in connection with a Letter of Credit for the purpose of purchasing Inventory, ~~provide Landlord with an additional letter(s) of credit, in~~ an amount equal to ~~the deficiency~~ one hundred (~~or a replacement letter of credit in the total amount of the LC Amount~~100%) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration percent of the Letter of Credit ~~or amendment)~~Obligations with respect thereto. Effective on the issuance of each Letter of Credit, ~~which~~ a Reserve shall be ~~irrevocable~~ established in the applicable amount set forth in Section 2.2(c)(iv)(A) or Section 2.2(c)(iv)(B). (d) Except in Agent's discretion, with the consent of all Lenders, the amount of all outstanding Letter of Credit Obligations shall not at any time exceed the Letter of Credit Limit. (e) Each Borrower shall reimburse immediately Issuing Bank for any draw under any Letter of Credit issued for the account of such Borrower and ~~automatically renewable as above provided through~~ pay Issuing Bank the ~~Lease Expiration Date upon~~ amount of all other charges and fees payable to Issuing Bank in connection with any Letter of Credit issued for the ~~same terms as the expiring~~ account of such Borrower immediately when due, irrespective of any claim, setoff, defense or other right which such Borrower may have at any time against Issuing Bank or any other Person. Each drawing under any Letter of Credit or other amount payable in connection therewith when due shall constitute a request by the Borrower for whose account such Letter of Credit was issued to Agent for a Prime Rate Loan in the amount of such drawing or other ~~terms~~ amount then due, and shall be made by Agent on behalf of Lenders as a Loan (or Special Agent Advance, as the case may be). The date of such Loan shall be ~~acceptable~~ the date of the drawing or as to ~~Landlord~~ other amounts, the due date therefor. Any payments made by or on behalf of Agent or any Lender to Issuing Bank and/or related parties in ~~its reasonable discretion~~connection with any Letter of Credit shall constitute additional Loans to such Borrower pursuant to this Section 2 (or Special Agent Advances as the case may be). (f) Borrowers and Guarantors shall indemnify and hold Agent and Lenders harmless from and against any and all losses, claims, damages, liabilities, costs and expenses which Agent or any Lender may suffer or incur in connection with any Letter of Credit and any documents, drafts or acceptances relating thereto, including any losses, claims, damages, liabilities, costs and expenses due to any action taken by Issuing Bank or correspondent with respect to any Letter of Credit, except for such losses, claims, damages, liabilities, costs or expenses that are a direct result of the gross negligence or willful misconduct of Agent or any Lender as determined pursuant to a final non-appealable order of a court of competent jurisdiction. ~~However~~Each Borrower and Guarantor assumes all risks with respect to the acts or omissions of the drawer under or beneficiary of any Letter of Credit and for such purposes the drawer or beneficiary shall be deemed such Borrower's agent. Each Borrower and Guarantor assumes all risks for, and agrees to pay, all foreign, Federal, State and local taxes, duties and levies relating to any goods subject to any Letter of Credit or any documents, drafts or acceptances thereunder. Each Borrower and Guarantor hereby releases and holds Agent and Lenders harmless from and against any acts, waivers, errors, delays or omissions with respect to or relating to any Letter of Credit, except for the gross negligence or willful misconduct of Agent or any Lender as determined pursuant to a final, non-appealable order of a court of competent jurisdiction. The provisions of this Section 2.2(f) shall survive the payment of Obligations and the termination of this Agreement. (g) In connection with Inventory purchased pursuant to any Letter of Credit, Borrowers and Guarantors shall, at Agent's request, instruct all suppliers, carriers, forwarders, customs brokers, warehouses or others receiving or holding cash, checks, Inventory, documents or instruments in which Agent holds a security interest that upon Agent's request, such items are to be delivered to Agent and/or subject to Agent's order, and if they shall come into such Borrower's or Guarantor's possession, to deliver them, upon Agent's request, to Agent in their original form. Except as otherwise provided herein, Agent shall not exercise such right to request such items so long as no Default or Event of Default shall exist or have occurred and be continuing. Except as Agent may otherwise specify, Borrowers and Guarantors shall designate Issuing Bank as the consignee on all bills of lading and other negotiable and non-negotiable documents. (h) Each Borrower and Guarantor hereby irrevocably authorizes and directs Issuing Bank to name such Borrower or Guarantor as the account party therein and to deliver to Agent all instruments, documents and other writings and property received by Issuing Bank pursuant to the Letter of Credit ~~is not timely renewed or a substitute or amendment~~ and to ~~letter of credit is not timely received, or if Tenant fails~~ accept and rely upon Agent's instructions and agreements with respect to ~~maintain~~ all matters arising in connection with the Letter of Credit ~~in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present~~ or the Letter of Credit Documents with respect thereto. Nothing contained herein shall be deemed or construed to grant any Borrower or Guarantor any right or authority to pledge the credit of Agent or any Lender in -41- any manner. Borrowers and Guarantors shall be bound by any reasonable interpretation made in good faith by Agent, or Issuing Bank under or in connection with any Letter of Credit Accommodation or any documents, drafts or acceptances thereunder, notwithstanding that such interpretation may be inconsistent with any instructions of any Borrower or Guarantor. (i) Immediately upon the issuance or amendment of any Letter of Credit, each Lender shall be deemed to have irrevocably and unconditionally purchased and received, without recourse or warranty, an undivided interest and participation to the ~~issuing bank~~ extent of such Lender's Pro Rata Share of the liability with respect to such Letter of Credit and the obligations of Borrowers with respect thereto (including all Letter of Credit Obligations with respect thereto). Each Lender shall absolutely, unconditionally and irrevocably assume, as primary obligor and not as surety, and be obligated to pay to Issuing Bank therefor and discharge when due, its Pro Rata Share of all of such obligations arising under such Letter of Credit. Without limiting the scope and nature of each Lender's participation in any Letter of Credit, to the extent that Issuing Bank has not been reimbursed or otherwise paid as required hereunder or under any such Letter of Credit, each such Lender shall pay to Issuing Bank its Pro Rata Share of such unreimbursed drawing or other amounts then due to Issuing Bank in connection therewith. (j) The obligations of Borrowers to pay each Letter of Credit Obligations and the obligations of Lenders to make payments to Agent for the account of Issuing Bank with respect to Letters of Credit shall be absolute, unconditional and irrevocable and shall be performed strictly in accordance with the terms of this ~~Article 27~~Agreement under any and all circumstances, ~~and~~ whatsoever, notwithstanding the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result occurrence or continuance of any ~~default~~ Default, Event of Default, the failure to satisfy any other condition set forth in Section 4 or any other event or circumstance. If such amount is not made available by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credita Lender when due, ~~any Cash Collateral held by Landlord~~ Agent shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to ~~any~~ recover such amount on demand from such Lender with interest ~~earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods~~thereon, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw each day from the ~~Letter~~ date such amount was due until the date such amount is paid to Agent at the interest rate then payable by any Borrower in respect of ~~Credit~~Loans that are Prime Rate Loans. ~~No condition~~ Any such reimbursement shall not relieve or ~~term~~ otherwise impair the obligation of ~~this Lease shall be deemed~~ Borrowers to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the reimburse Issuing Bank under any Letter of Credit or make any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950other payment in connection therewith.

Appears in 1 contract

Samples: Loan and Security Agreement (Delta Apparel Inc)

Letter of Credit. ~~Within forty-five (45) days after~~ A. On or before the ~~mutual execution and delivery of this Lease~~Effective Date, Tenant shall deliver to ~~Landlord~~Landlord an unconditional, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease~~clean, an irrevocable ~~and unconditional negotiable~~ letter of credit (the “Letter of Credit”) in the amount specified in Section 1.10 (the “Full L-C Amount”), ~~substantially~~ which Letter of Credit (a) shall be in the form of Exhibit F attached ~~as Exhibit G~~ hereto ~~and made a part hereof~~(or contain variations only if approved by Landlord), ~~and containing the terms required herein, payable in the State of California, running in favor of Landlord,~~ (b) shall be issued by a ~~solvent~~ regional or other money-center bank (a bank which accepts deposits, maintains accounts, has a local San Francisco, California office which will negotiate a Letter of Credit or alternatively which accepts draw requests via facsimile or overnight courier, and whose deposits are insured by the FDIC) reasonably approved by Landlord ~~under~~ (the ~~supervision~~ “Issuing Bank”), and (c) shall not be secured by cash deposited by Tenant with the Issuing Bank or by a pledge by Tenant to the Issuing Bank of cash or other collateral belonging to Tenant. Landlord hereby approves Silicon Valley Bank as the Issuing Bank. The amount of the ~~Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen~~ Letter of Credit ~~from~~ (the ~~approved issuer prior~~ “L-C Amount”) shall be the Full L-C Amount. B. Tenant shall pay all expenses, points and/or fees incurred in obtaining, modifying, renewing or reissuing the Letter of Credit pursuant to the ~~execution~~ provisions of this ~~Lease~~Section 26.02. The Letter of Credit shall ~~be: (a) at sight and irrevocable; (b)~~ be maintained in effect by Tenant for the ~~entire period from the date of execution of this Lease through~~ Full L-C Amount until the date which is ~~sixty~~ ninety (6090) days following the ~~Termination Date (“Letter~~ expiration of ~~Credit Expiration Date”), subject to~~ the ~~last paragraph~~ Term of this ~~Article 27, provide that the expiration date of the~~ Lease. C. The Letter of Credit shall be ~~no earlier than~~ held by Landlord as security for the faithful performance by Tenant of all of the terms, covenants and conditions of this Lease to be kept and performed by Tenant, and the parties hereto acknowledge and agree that the Letter of Credit ~~Termination Date or provide for automatic renewal thereof at least through~~ does not constitute and shall not, in any event, be deemed to constitute a security deposit. Tenant authorizes Landlord to take any actions necessary to perfect Landlord’s security interest in the Letter of Credit ~~Expiration Date~~including, ~~unless~~ without limitation, to duly execute on behalf of Tenant (and for the ~~issuing bank provides at least thirty (30~~benefit of Landlord or any of Landlord’s assigns) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a ~~new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of~~ financing statement describing the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash collateral (the “~~Cash Collateral~~Financing Statement”) and to file or cause to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of filed the ~~required replacement letter of credit in the LC Amount and otherwise complying~~ Financing Statement with all ~~of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned~~ appropriate authorities so as to ~~Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a~~ perfect Landlord’s security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. ~~No condition~~ Tenant agrees to (and Tenant shall) execute any Financing Statements and/or any further documents and to take any further actions reasonably requested by Landlord to evidence, perfect or ~~term of this Lease shall be deemed to render~~ maintain Landlord’s first priority security interest in the Letter of ~~Credit conditional to justify the issuer of the~~ Credit. The Letter of Credit shall not be mortgaged, assigned or encumbered in ~~failing to honor a drawing upon such Letter~~ any manner whatsoever by Tenant. The use, application or retention of ~~Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall~~ the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.Letter

Appears in 1 contract

Samples: Lease Agreement (PagerDuty, Inc.)

Letter of Credit. ~~Within~~ a. As security for the performance by Tenant of Tenant's obligations hereunder, Tenant shall cause to be delivered to Landlord within one (1) Business Day after the First Rights Contingency Satisfaction Date, an original irrevocable standby letter of credit (the "Letter of Credit") in the amount of Two Million Five Hundred Thousand Dollars ($2,500,000.00), naming Landlord as beneficiary, which Landlord may draw upon to cure any Event of Default under this Lease (or any default under this Lease where there exist circumstances under which Landlord is enjoined or otherwise prevented by operation of law from giving to Tenant a written notice which would be necessary for such failure of performance to constitute an Event of Default under this Lease), or to compensate Landlord for any damage Landlord incurs as a result of Tenant's failure to perform any of its obligations hereunder; provided, however, that neither the Letter of Credit nor any proceeds therefrom shall be deemed an advance rent deposit or an advance payment of any other kind, or a measure or limitation of Landlord's damages or constitute a bar or defense to any of the Landlord's other remedies under this Lease or at law upon Tenant's default. The Letter of Credit shall be issued by a major national commercial bank reasonably acceptable to Landlord, with a service and claim point for the Letter of Credit in San Francisco, California, have an expiration date not earlier than sixty (60) days after the Expiration Date (or, in the alternative, have a term of not less than one (1) year and be automatically renewable for an additional one (1) year period unless notice of non-renewal is given by the issuer to Landlord not later than sixty (60) days prior to the expiration thereof) and shall provide that Landlord may make partial and multiple draws thereunder, up to the face amount thereof. The Letter of Credit shall be in the form attached hereto as Exhibit C (as modified to the extent required to comply with any changes after the date hereof to laws applicable thereto), and shall otherwise be in form and content satisfactory to Landlord. If the Letter of Credit has an expiration date earlier than sixtieth (60th) day after the Expiration Date, then throughout the term hereof (including any renewal or extension of the term) Tenant shall provide evidence of renewal of the Letter of Credit to Landlord at least forty-five (45) days ~~after~~ prior to the ~~mutual execution~~ date the Letter of Credit expires. If Landlord draws on the Letter of Credit pursuant to the terms hereof, Tenant shall immediately replenish the Letter of Credit or provide Landlord with an additional letter of credit conforming to the requirement of this paragraph so that the amount available to Landlord from the Letter(s) of Credit provided hereunder is the amount specified above. Tenant's failure to deliver any replacement, additional or extension of the Letter of Credit, or evidence of renewal of the Letter of Credit, within the time specified under this Lease shall entitle Landlord to draw upon the Letter of Credit then in effect. If Landlord liquidates the Letter of Credit as provided in the preceding sentence, Landlord shall hold the funds received from the Letter of Credit as security for Tenant's performance under this Lease, and ~~delivery~~ Landlord shall be deemed to hold a perfected, first priority security interest in such funds (and Tenant does hereby appoint Landlord its attorney-in-fact for purposes of filing such financing statements or other instruments as Landlord shall deem advisable to further evidence and/or perfect such security interest). Landlord shall not be required to segregate such security deposit from its other funds and no interest shall accrue or be payable to Tenant with respect thereto. No holder of a Superior Interest (as defined in Paragraph 21 below), nor any purchaser at any judicial or private foreclosure sale of the Real Property or any portion thereof, shall be responsible to Tenant for such security deposit unless and only to the extent such holder or purchaser shall have actually received the same. If Landlord transfers such security deposit to the grantee or transferee of Landlord's interest in the Real Property, Landlord shall be released from any further responsibility or liability for such security. If Tenant is not in default at the expiration or termination of this Lease, Landlord shall return to Tenant ~~shall deliver to~~ the Letter of Credit or the balance of the security deposit then held by Landlord, as ~~collateral for the full and faithful performance by Tenant of all of its obligations under this Lease~~applicable, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is within sixty (60) days ~~following~~ thereafter; provided, however, that in no event shall any such return be construed as an admission by Landlord that Tenant has performed all of its covenants and obligations hereunder. b. Notwithstanding the ~~Termination Date~~ foregoing, on the commencement of Lease Year 6, and on the commencement of each Lease Year thereafter (~~“Letter of Credit Expiration~~ each such anniversary, a "Reduction Date”"), ~~subject to~~ so long as no Event of Default (as defined in Paragraph 25 below) by Tenant under this Lease has occurred and is continuing as of such Reduction Date, and so long as no breach or default by Tenant under this Lease which, with notice or the ~~last paragraph~~ passage of ~~this Article 27~~time or both could ripen into an Event of Default (an "Unmatured Default"), ~~provide that~~ shall be continuing as of the ~~expiration date of~~ Reduction Date, the amount required under the Letter of Credit shall be ~~no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date~~reduced by Five Hundred Thousand Dollars ($500,000.00). Accordingly, ~~unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail~~if all Reductions are made as so scheduled, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this during Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) Year 10 the Letter of Credit will be ~~honored by~~ reduced to zero and will not be required. If Tenant is entitled to such reduction, Tenant may replace or amend the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said then existing Letter of Credit to ~~a new landlord~~reflect such reduced amount on or after the applicable Reduction Date. ~~If, as a result of any application or use by~~ If Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and disallows any such ~~additional (or replacement) letter~~ reduction by reason of ~~credit shall comply with all of the provisions of this Article 27~~an Unmatured Default, and if ~~Xxxxxx fails to comply with~~ Tenant cures the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days Unmatured Default prior to the ~~expiration~~ same becoming an Event of Default, the ~~Letter~~ date that is five (5) days after the date such Unmatured Default is cured shall become the new Reduction Date for purposes of ~~Credit or amendment),~~ making the reduction which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950was previously disallowed.

Appears in 1 contract

Samples: Office Lease (Critical Path Inc)

Letter of Credit. ~~Within forty-five~~ (451) ~~days after~~ DEVELOPER shall provide to the ~~mutual execution and delivery of this Lease, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease~~COUNTY, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in a form acceptable to the ~~total~~ COUNTY, which guarantees the DEVELOPER's costs of the installation of the school zone flashers described in paragraph 2 above, in the amount of Dollars ($ ), which represents the ~~LC Amount~~DEVELOPER's share of the cost of the school zone flashers. (2) In the event DEVELOPER fails to pay to the COUNTY the sums set forth in paragraph 2 above, COUNTY shall be entitled to draw against the security for the amount set forth above, plus costs and interest as set out herein. If COUNTY draws against the security and the amount recovered is less than the amount due, COUNTY may maintain an action against DEVELOPER in a court of competent jurisdiction for the difference between any sums obtained and the amount due, plus costs and interest accrued from the due date at the rate of twelve percent (12%) per annum. (3) DEVELOPER shall ensure the substitute security remains valid and in full force and effect until DEVELOPER's obligation to pay for or install the school zone flashers are fully performed. Expiration of the security prior to DEVELOPER's performance of such ~~additional~~ obligation, or notice to COUNTY the security will expire, or has been canceled, or disaffirmed, prior to DEVELOPER's satisfaction of all obligations hereunder, shall constitute a default of this Agreement. (~~or replacement~~4) In the event the letter of credit ~~shall comply with all~~ provided to COUNTY expires, is canceled, or is disaffirmed, COUNTY may record a document entitled "Notice of ~~the provisions~~ Lien for Installation of ~~this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same~~ School Zone Flasher Improvements," which shall constitute ~~an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber~~ a lien on the ~~Letter of Credit~~property described in Exhibit "A" for the amount due hereunder until fully paid, discharged, released, or ~~any part thereof and that neither Landlord nor its successors or assigns will be bound~~ barred by ~~any such assignment, encumbrance, attempted assignment or attempted encumbrance~~law. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to To the extent ~~necessary~~ that the failed security is attributable to ~~cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind~~ an identified parcel or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the ~~Letter~~ Project, the Notice of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx Lien for School Zone Flasher Improvements may be recorded against and ~~Landlord as~~ apply only to ~~Landlord’s right to draw from the Letter of Credit. No condition~~ such parcel or ~~term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer~~ portion of the ~~Letter~~ Project. The above provisions shall control such lien except that the provisions regarding subordination of ~~Credit in failing to honor a drawing upon such Letter of Credit~~ mortgages shall not apply. If the DEVELOPER provides substitute security in a ~~timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance~~ form acceptable to COUNTY, COUNTY shall release the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950lien.

Appears in 1 contract

Samples: School Zone Flasher Agreement

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after~~ Subject to and upon the ~~mutual execution~~ terms and ~~delivery of this Lease, Tenant shall deliver to Landlord, as collateral for the full~~ conditions contained herein and ~~faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially~~ in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit ~~from~~ Documents, at the ~~approved issuer prior~~ request of a Borrower (or Administrative Borrower on behalf of such Borrower), Agent agrees to cause Issuing Bank to issue, and Issuing Bank agrees to issue, for the ~~execution~~ account of such Borrower one or more Letters of Credit, for the ratable risk of each Lender according to its Pro Rata Share, containing terms and conditions acceptable to Agent and Issuing Bank. From and after the Closing Date, all Existing Letters of Credit outstanding on the Closing Date shall be deemed to be issued and outstanding, and to constitute Letters of Credit, under this ~~Lease. The~~ Agreement and all Letter of Credit Obligations (as defined in the Existing Loan Agreement) outstanding on the Closing Date shall ~~be: (a) at sight~~ be deemed to be and ~~irrevocable;~~constitute Letter of Credit Obligations under this Agreement, and shall be subject to all of the terms and conditions hereof. (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of The Borrower requesting such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (~~and the bank issuing the same~~or Administrative Borrower on behalf of such Borrower) shall give Agent and Issuing Bank two (2) Business Days' prior written notice of such Borrower's request for the issuance of a Letter of Credit. Such notice shall be ~~acceptable to Landlord, in Landlord’s reasonable discretion,~~ irrevocable and shall ~~provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have~~ specify the ~~right to draw down an amount up to the~~ original face amount of the Letter of Credit ~~upon~~ requested, the ~~presentation~~ effective date (which date shall be a Business Day and in no event shall be a date less than ten (10) days prior to the ~~issuing bank~~ end of ~~Landlord’s~~ the then current term of this Agreement) of issuance of such requested Letter of Credit, whether such Letter of Credit may be drawn in a single or in partial draws, the date on which such requested Letter of Credit is to expire (~~or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent~~ which date shall be a ~~corporation, partnership or other entity, then such statement~~ Business Day and shall not be ~~signed by an officer (if a corporation~~more than one year from the date of issuance), ~~a general partner (if a partnership)~~the purpose for which such Letter of Credit is to be issued, ~~or any authorized party (if another entity); (ii)~~ and the beneficiary of the requested Letter of Credit. The Borrower requesting the Letter of Credit ~~will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content~~ (or Administrative Borrower on behalf of such ~~statement; and (iii~~Borrower) in shall attach to such notice the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part proposed terms of the Letter of Credit. The renewal or extension of any Letter of Credit shall, for purposes hereof be treated in all respects the ~~amount~~ same as the issuance of a new Letter of Credit hereunder. (c) In addition to being subject to the satisfaction of the applicable conditions precedent contained in Section 4 hereof and the other terms and conditions contained herein, no Letter of Credit shall be available unless each of the following conditions precedent have been satisfied in a manner satisfactory to Agent: (i) the Borrower requesting such Letter of Credit (or Administrative Borrower on behalf of such Borrower) shall have delivered to Issuing Bank at such times and in such manner as Issuing Bank may require, an application, in form and substance satisfactory to Issuing Bank and Agent, for the issuance of the Letter of Credit and such other Letter of Credit Documents as may be required pursuant to the terms thereof, and the form and terms of the proposed Letter of Credit shall be ~~less than~~ satisfactory to Agent and Issuing Bank, (ii) as of the ~~LC Amount~~date of issuance, ~~Tenant shall~~no order of any court, arbitrator or other Governmental Authority shall purport by its terms to enjoin or restrain money center banks generally from issuing letters of credit of the type and in the amount of the proposed Letter of Credit, and no law, rule or regulation applicable to money center banks generally and no request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over money center banks generally shall prohibit, or request that Issuing Bank refrain from, the issuance of letters of credit generally or the issuance of such Letter of Credit, (iii) after giving effect to the issuance of such Letter of Credit, the Letter of Credit Obligations shall not exceed the Letter of Credit Limit, and (iv) the Excess Availability, prior to giving effect to any Reserves with respect to such Letter of Credit, on the date of the proposed issuance of any Letter of Credit shall be equal to or greater than: (A) if the proposed Letter of Credit is for the purpose of purchasing Inventory that would constitute Eligible Inventory but for the fact that it is or will be in transit to the premises of a Borrower located with the United States, and the documents of title with respect thereto are consigned and delivered to Issuing Bank at a location in the United States, the sum of (1) the percentage equal to one hundred percent (100%) minus the then applicable percentage with respect to Eligible Inventory set forth in the definition of the term Borrowing Base multiplied by the Value of such Eligible Inventory, plus (2) freight, taxes, duty and other amounts which Agent estimates must be paid in connection with such Inventory upon arrival and for delivery to one of such Borrower's locations for Eligible Inventory within ~~ten~~ the United States of America and (10B) ~~business days thereafter~~if the proposed Letter of Credit is for any other purpose or the documents of title are not consigned and delivered to Issuing Bank at a location in the United States in connection with a Letter of Credit for the purpose of purchasing Inventory, ~~provide Landlord with an additional letter(s) of credit, in~~ an amount equal to ~~the deficiency~~ one hundred (~~or a replacement letter of credit in the total amount of the LC Amount~~100%) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration percent of the Letter of Credit ~~or amendment)~~Obligations with respect thereto. Effective on the issuance of each Letter of Credit, ~~which~~ a Reserve shall be ~~irrevocable~~ established in the applicable amount set forth in Section 2.2(c)(iv)(A) or Section 2.2(c)(iv)(B). (d) Except in Agent's discretion, with the consent of all Lenders, the amount of all outstanding Letter of Credit Obligations shall not at any time exceed the Letter of Credit Limit. (e) Each Borrower shall reimburse immediately Issuing Bank for any draw under any Letter of Credit issued for the account of such Borrower and ~~automatically renewable as above provided through~~ pay Issuing Bank the ~~Lease Expiration Date upon~~ amount of all other charges and fees payable to Issuing Bank in connection with any Letter of Credit issued for the ~~same terms as the expiring~~ account of such Borrower immediately when due, irrespective of any claim, setoff, defense or other right which such Borrower may have at any time against Issuing Bank or any other Person. Each drawing under any Letter of Credit or other amount payable in connection therewith when due shall constitute a request by the Borrower for whose account such Letter of Credit was issued to Agent for a Prime Rate Loan in the amount of such drawing or other ~~terms~~ amount then due, and shall be made by Agent on behalf of Lenders as a Loan (or Special Agent Advance, as the case may be). The date of such Loan shall be ~~acceptable~~ the date of the drawing or as to ~~Landlord~~ other amounts, the due date therefor. Any payments made by or on behalf of Agent or any Lender to Issuing Bank and/or related parties in ~~its reasonable discretion~~connection with any Letter of Credit shall constitute additional Loans to such Borrower pursuant to this Section 2 (or Special Agent Advances as the case may be). (f) Borrowers and Guarantors shall indemnify and hold Agent and Lenders harmless from and against any and all losses, claims, damages, liabilities, costs and expenses which Agent or any Lender may suffer or incur in connection with any Letter of Credit and any documents, drafts or acceptances relating thereto, including any losses, claims, damages, liabilities, costs and expenses due to any action taken by Issuing Bank or correspondent with respect to any Letter of Credit, except for such losses, claims, damages, liabilities, costs or expenses that are a direct result of the gross negligence or willful misconduct of Agent or any Lender as determined pursuant to a final non-appealable order of a court of competent jurisdiction. ~~However~~Each Borrower and Guarantor assumes all risks with respect to the acts or omissions of the drawer under or beneficiary of any Letter of Credit and for such purposes the drawer or beneficiary shall be deemed such Borrower's agent. Each Borrower and Guarantor assumes all risks for, and agrees to pay, all foreign, Federal, State and local taxes, duties and levies relating to any goods subject to any Letter of Credit or any documents, drafts or acceptances thereunder. Each Borrower and Guarantor hereby releases and holds Agent and Lenders harmless from and against any acts, waivers, errors, delays or omissions with respect to or relating to any Letter of Credit, except for the gross negligence or willful misconduct of Agent or any Lender as determined pursuant to a final, non-appealable order of a court of competent jurisdiction. The provisions of this Section 2.2(f) shall survive the payment of Obligations and the termination of this Agreement. (g) In connection with Inventory purchased pursuant to any Letter of Credit, Borrowers and Guarantors shall, at Agent's request, instruct all suppliers, carriers, forwarders, Customs Brokers, warehouses or others receiving or holding cash, checks, Inventory, documents or instruments in which Agent holds a security interest that upon Agent's request, such items are to be delivered to Agent and/or subject to Agent's order, and if they shall come into such Borrower's or Guarantor's possession, to deliver them, upon Agent's request, to Agent in their original form. Except as otherwise provided herein, Agent shall not exercise such right to request such items so long as no Default or Event of Default shall exist or have occurred and be continuing. Except as Agent may otherwise specify, Borrowers and Guarantors shall designate Issuing Bank as the consignee on all bills of lading and other negotiable and non-negotiable documents. (h) Each Borrower and Guarantor hereby irrevocably authorizes and directs Issuing Bank to name such Borrower or Guarantor as the account party therein and to deliver to Agent all instruments, documents and other writings and property received by Issuing Bank pursuant to the Letter of Credit ~~is not timely renewed or a substitute or amendment~~ and to ~~letter of credit is not timely received, or if Tenant fails~~ accept and rely upon Agent's instructions and agreements with respect to ~~maintain~~ all matters arising in connection with the Letter of Credit ~~in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present~~ or the Letter of Credit Documents with respect thereto. Nothing contained herein shall be deemed or construed to grant any Borrower or Guarantor any right or authority to pledge the credit of Agent or any Lender in any manner. Borrowers and Guarantors shall be bound by any reasonable interpretation made in good faith by Agent, or Issuing Bank under or in connection with any Letter of Credit or any documents, drafts or acceptances thereunder, notwithstanding that such interpretation may be inconsistent with any instructions of any Borrower or Guarantor. (i) Immediately upon the issuance or amendment of any Letter of Credit, each Lender shall be deemed to have irrevocably and unconditionally purchased and received, without recourse or warranty, an undivided interest and participation to the ~~issuing bank~~ extent of such Lender's Pro Rata Share of the liability with respect to such Letter of Credit and the obligations of Borrowers with respect thereto (including all Letter of Credit Obligations with respect thereto). Each Lender shall absolutely, unconditionally and irrevocably assume, as primary obligor and not as surety, and be obligated to pay to Issuing Bank therefor and discharge when due, its Pro Rata Share of all of such obligations arising under such Letter of Credit. Without limiting the scope and nature of each Lender's participation in any Letter of Credit, to the extent that Issuing Bank has not been reimbursed or otherwise paid as required hereunder or under any such Letter of Credit, each such Lender shall pay to Issuing Bank its Pro Rata Share of such unreimbursed drawing or other amounts then due to Issuing Bank in connection therewith. (j) The obligations of Borrowers to pay each Letter of Credit Obligations and the obligations of Lenders to make payments to Agent for the account of Issuing Bank with respect to Letters of Credit shall be absolute, unconditional and irrevocable and shall be performed strictly in accordance with the terms of this ~~Article 27~~Agreement under any and all circumstances, ~~and~~ whatsoever, notwithstanding the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result occurrence or continuance of any ~~default~~ Default, Event of Default, the failure to satisfy any other condition set forth in Section 4 or any other event or circumstance. If such amount is not made available by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credita Lender when due, ~~any Cash Collateral held by Landlord~~ Agent shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to ~~any~~ recover such amount on demand from such Lender with interest ~~earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods~~thereon, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw each day from the ~~Letter~~ date such amount was due until the date such amount is paid to Agent at the interest rate then payable by any Borrower in respect of ~~Credit~~Loans that are Prime Rate Loans. ~~No condition~~ Any such reimbursement shall not relieve or ~~term~~ otherwise impair the obligation of ~~this Lease shall be deemed~~ Borrowers to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the reimburse Issuing Bank under any Letter of Credit or make any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950other payment in connection therewith.

Appears in 1 contract

Samples: Loan and Security Agreement (Delta Apparel, Inc)

Letter of Credit. ~~Within forty-five~~ (45a) As additional security for the full and faithful payment of all sums due under this Lease and the full and faithful performance of every covenant and condition of this Lease to be performed by Tenant, within ten (10) business days after ~~the mutual~~ execution and delivery of this ~~Lease~~Lease by Landlord and Tenant, Tenant shall deliver to ~~Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable~~ Landlord a letter of credit in the amount of $1,133,622 (the “LC Amount”) in favor of Landlord and effective immediately upon issuance (the “Letter of Credit”). The Letter of Credit initially delivered pursuant to this paragraph and all substitutions, ~~substantially in~~ replacements and renewals of it, must be consistent with and shall satisfy all the ~~form attached as Exhibit G hereto~~ following requirements: (i) the Letter of Credit shall be clean, irrevocable and ~~made~~ unconditional; (ii) the Letter of Credit must be issued by a ~~part hereof,~~ bank which is a member of the New York Clearing House and ~~containing~~ which has a banking office dedicated to the ~~terms required herein, payable~~ administration and payment of letters of credit in the State of California, ~~running~~ which bank must be satisfactory to Landlord in ~~favor of Landlord, issued by a solvent bank reasonably approved by Landlord under~~ its reasonable discretion; (iii) the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall ~~be: (a) at sight and irrevocable; (b) maintained in effect for~~ have an expiration date no earlier than the ~~entire period from~~ first anniversary of the date of ~~execution~~ its issuance and shall provide for its automatic renewal from year to year unless terminated by the issuing bank by notice to Landlord given not less than sixty (60) days prior to its expiration date by registered or certified mail (and the final expiration date of ~~this Lease through~~ the ~~date which is~~ Letter of Credit and all renewals of it shall be no earlier than sixty (60) days following the ~~Termination Date~~ end of the Lease Term); (“iv) the Letter of Credit ~~Expiration Date”)~~may be drawn at the State of California banking office of the issuer and must allow for draws to be made at sight pursuant to a form of draw request which has been approved by Landlord; (v) the Letter of Credit must allow for one draw in the whole amount or multiple partial draws (and Landlord shall not, ~~subject~~ as a condition to any draw, be required to deliver any certificate, affidavit or other writing to the ~~last paragraph~~ issuer expressing the basis for the draw; nor shall the issuer have the right to inquire as to the basis for the draw or require instruction or authorization from any party other than Landlord; nor shall issuer be permitted to withhold a draw, when requested by Landlord, as a result of ~~this Article 27, provide that the expiration date of~~ any instruction from any other party); (vi) the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved freely transferable by Landlord, ~~in its reasonable discretion, and, in such event,~~ provided that Tenant shall ~~deliver a new Letter of Credit to Landlord at least thirty (30) days prior to~~ only be responsible for the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord fees in connection with ~~any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any~~ the first such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit ; (~~and the bank issuing the same~~vii) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be ~~less than~~ governed by (A) the ~~LC Amount, Tenant shall, within ten~~ International Standby Practices SP 98 published by the International Chamber of Commerce and (10B) ~~business days thereafter, provide Landlord with an additional letter(s~~the United Nations Convention on Independent Guarantees and Standby Letters of Credit; and (viii) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of ~~Credit, or any part thereof and that neither~~ Credit shall otherwise be in such form as Landlord ~~nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance~~may require. Without limiting the generality of the foregoing, the Letter of Credit must be issued by a bank or financial institution reasonably acceptable to Landlord (x) that is chartered under the laws of the United States, any state thereof or the District of Columbia, and which is insured by the Federal Deposit Insurance Corporation, (y) whose long-term debt ratings on bank level senior debt obligations are rated in not lower than the third highest category by at least two of Fitch Ratings Ltd. (“Fitch”), Xxxxx’x Investors Service, Inc. (“Moody’s”) and Standard & Poor’s Ratings Services (“S&P”) or their respective successors (the “Rating Agencies”) (which, as of the date hereof, shall mean A from Fitch, A from Moody’s or As from S&P) and (z) which has a short-term deposit rating at the bank level in the highest category from at least two Rating Agencies (which shall mean F1 from Fitch, P-1 from Moody’s and A-1 from S&P) (the “Issuer”). Landlord hereby approves Xxxxx Fargo Bank as the Issuer. The Letter of Credit shall be in substantially the form attached hereto as Exhibit G and incorporated by reference herein. (b) Landlord may draw on the Letter of Credit, without advance notice to Tenant except as expressly set forth in this Lease, at any time or from time to time on or after (i) the occurrence of any Event of Default, or (ii) if Tenant, or anyone in possession of the Premises (or any portion thereof) through Tenant, holds over after the expiration or earlier termination of this Lease, or (iii) Landlord is given notice by the issuer of the Letter of Credit that it is terminating the Letter of Credit, or (iv) the Letter of Credit expires ~~earlier than the Lease Expiration Date, Landlord will accept~~ on a ~~renewal letter of credit~~ specified date by its terms and is not renewed or ~~substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than~~ replaced at least thirty (30) days ~~prior~~ in advance of its expiration date, or (v) to the ~~expiration~~ extent permitted by law, in the event any bankruptcy, insolvency, reorganization or any other debtor creditor proceeding is instituted by or against Tenant. Tenant hereby waives the provisions of any law, now or hereafter in effect, which limits the manner in which Landlord may apply sums drawn from the Letter of Credit, it being agreed that Landlord may apply such amounts towards any sums reasonably necessary to compensate Landlord for any other loss or damage, foreseeable or unforeseeable, caused by the acts or omissions of Tenant or any officer, employee, agent, contractor or invitee of Tenant. (c) In addition, if at any time the bank or financial institution that issues the Letter of Credit is declared insolvent, or is placed into receivership by the Federal Deposit Insurance Corporation or any other governmental or quasi-governmental institution, or if the bank or financial no longer satisfies the ratings requirements set forth in Paragraph 5(a)(y) or 5(a)(z) above, then following written notice from Landlord, Tenant shall have fifteen (15) days to replace the Letter of Credit with a new letter of credit from a bank or financial institution reasonably acceptable to Landlord. If Tenant does not replace the Letter of Credit with a new letter of credit from a bank or financial institution reasonably acceptable to Landlord within such fifteen (15) day period, then notwithstanding anything to the contrary herein, Tenant shall be in default under the Lease (without any additional notice or opportunity to cure), and Landlord shall have the right to draw upon the Letter of Credit for the full amount of the Letter of Credit, and such amount shall be held by Landlord as a cash security deposit for application, at Landlord’s election, to future sums owing to Landlord under the Lease, in such order and priority as Landlord elects in its absolute discretion. (d) Landlord may apply any sum drawn on the Letter of Credit to amounts owing to Landlord under this Lease in such order and priority as Landlord elects in its absolute discretion. If any of the proceeds drawn on the Letter of Credit are not applied immediately to sums owing to Landlord under this Lease, Landlord may retain any such excess proceeds as a cash security deposit for application, at Landlord’s election, to future sums owing to Landlord under this Lease, in such order and priority as Landlord elects in its absolute discretion. Tenant shall, within ten (10) days after Landlord’s demand, restore the amount of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if drawn so that the Letter of Credit is restored to the original amount of the Letter of Credit. If Tenant does not ~~timely renewed or~~ restore the Letter of Credit to its original amount within the required time period, such non-restoration shall be considered an Event of Default. Notwithstanding anything to the contrary contained in this Lease, if Landlord draws on the Letter of Credit, then Tenant shall have the right, upon ten (10) days' prior written notice to Landlord, to obtain a ~~substitute or amendment~~ refund from Landlord of any unapplied proceeds of the Letter of Credit which Landlord has drawn upon, any such refund being conditioned upon Tenant simultaneously delivering to ~~letter of credit is not timely received, or if Tenant fails to maintain the~~ Landlord a new original replacement Letter of Credit in the amount then required, and ~~in accordance with~~ otherwise meeting the ~~terms set forth~~ requirements contained in this ~~Article 27~~Paragraph. (e) Additionally, ~~Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27,~~ Landlord’s draw and ~~the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance~~ application of all ~~of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of~~ or any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord portion of the proceeds of the Letter of Credit shall not impair any other rights or remedies provided under this Lease or under applicable law and shall not be construed as a payment of liquidated damages. If Tenant shall have fully complied with all of the covenants and conditions of this Lease, the Letter of Credit shall be returned to Tenant or, if Landlord has drawn on the Letter of Credit, ~~either prior~~ the remaining proceeds of the Letter of Credit which are in excess of sums due the Landlord shall be repaid to Tenant, without interest, within thirty (30) days after the expiration or ~~following a “draw”~~ termination of the Term, delivery of possession of the Premises by Tenant to Landlord in accordance with this Lease, and the satisfaction by Tenant of all of its obligations under the Lease. (f) On any request by Landlord made during the Term, Tenant shall, at no material cost to Tenant, cooperate in accomplishing any reasonable modification of the Letter of Credit requested by Landlord. If the Letter of Credit should be lost, mutilated, stolen or destroyed, Tenant shall, at no out-of-pocket cost to Tenant (other than de minimis expense), cooperate in obtaining the issuance of a replacement. (g) Tenant shall not assign or grant any ~~portion~~ security interest in the Letter of Credit and any attempt to do so shall be void and of no effect. (h) In the event of a voluntary sale or transfer of Landlord’s estate or interest in the Premises, Landlord shall transfer the Letter of Credit to the vendee or the transferee (to the extent not required to satisfy obligations of Tenant to Landlord), Tenant shall pay any transfer fees, but only for the first transfer, charged by the issuing bank and Landlord shall thereafter be considered released by Tenant from all liability for the return of the Letter of Credit. Tenant shall cooperate in effecting such transfer (at no material cost to Tenant, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether but without limiting Tenant's responsibility for any ~~dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from~~ transfer fees for the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. first transfer, ). (i) Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor ~~or Cash Collateral be:~~ be (e1) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; , (f2) subject to the terms of such Section 1950.7~~; or~~ , or (g3) intended to serve as a “security deposit” within the meaning of such Section ~~1950~~1950.7. The parties hereto (xx) recite that the Letter of Credit is not intended to serve as a security deposit and such Section 1950.7 and any and all other laws, rules and regulations applicable to security deposits in the commercial context (“Security Deposit Laws”) shall have no applicability or relevancy thereto, and (yy) waive any and all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit Laws. (j) Notwithstanding the foregoing, if the Reduction Preconditions (defined below) are then satisfied, the LC Amount shall be reduced to equal $600,000.00. Upon satisfaction of the Reduction Precondition, Tenant shall be permitted to deliver to Landlord, at Tenant's sole cost, a new Letter of Credit (a “Replacement Letter of Credit”) which satisfies all of the terms and conditions described above in Paragraph 5(a). Upon Landlord’s receipt of a Replacement Letter of Credit that satisfies the terms and conditions of Paragraph 5(a), Landlord shall no longer be permitted to draw upon any existing Letter of Credit previously delivered by Tenant pursuant to Paragraph 5(a), and Landlord shall return to Tenant any such existing Letter of Credit then in Landlord’s possession within thirty (30) days following Landlord’s receipt of the Replacement Letter of Credit. As used herein, the term “Reduction Preconditions” means that Tenant is not then, and has not previously been, in default under this Lease after applicable notice and cure period and Tenant delivers to Landlord supporting financial documentation reasonably acceptable to Landlord evidencing that all of the following are true (as certified by the CEO, CFO, General Counsel or Vice President of Tenant): Tenant then has, and for each of the then two (2) most recently completed calendar quarters, Tenant had positive EBITDA. For purposes of this Lease, "EBITDA," shall mean Tenant's Operating Income plus Depreciation and Amortization, stock based compensation, debt extinguishment charges, amortization on debt issuance and any one-time non-cash charges, all as determined in accordance with generally accepted accounting principles.

Appears in 1 contract

Samples: Lease Agreement (Bloom Energy Corp)

Letter of Credit. ~~Within forty-five (45) days after~~ If at any time you are not licensed as an insurer or accredited as a reinsurer in all of the ~~mutual execution and delivery~~ states, territories, or if applicable, the District of ~~this Lease, Tenant shall deliver to Landlord~~Columbia, as ~~collateral~~ necessary for us to take credit on our Annual Statement for all or part of the ~~full and faithful performance by Tenant of all of its obligations~~ coverage we ceded to you, then unless you have arranged to secure your own obligation under this ~~Lease~~Agreement in some other manner which meets the approval of that regulatory authority, an you are obligated to promptly obtain a clean, unconditional irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit ~~from the approved issuer prior to the execution of this Lease~~for our benefit. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be ~~honored~~ issued by a qualified financial institution within the ~~issuing bank without inquiry as to the accuracy thereof and regardless~~ meaning of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, New York Insurance Regulation 133 in an amount equal to the ~~deficiency (or~~ reserves ceded to you and will be in a ~~replacement letter~~ form acceptable under New York Insurance Regulation 133. You will bear the cost of ~~credit in the total amount of the LC Amount) and~~ any such ~~additional (or replacement~~Letter(s) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit. If established, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if we may draw on the Letter of Credit ~~expires earlier than~~ at any time only for the ~~Lease Expiration Date, Landlord~~ following purposes: a) To pay your share or to reimburse us for your share of unearned premium or any liability for loss ceded by this Agreement; b) To make refund of any sum which is in excess of the actual amount required to pay your share of any unearned premium or liability ceded under this Agreement; c) To pay other amounts due us under this Agreement. In the event that we receive notice from the qualified financial institution that the Letter of Credit will ~~accept a renewal letter of~~ not be renewed and security acceptable under the insurance regulations regarding credit ~~or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable,~~ for reinsurance is not ~~later than thirty (30)~~ established within ten days prior to the ~~expiration~~ date of expiration, you agree to fund an account with us in an amount at least equal to the deduction for reinsurance ceded, from our liabilities ceded under this Agreement. Such amount shall include, but not be limited to, amounts for policy reserves, reserves for claims and losses incurred (including losses incurred but not reported), loss adjustment expenses, and unearned premiums; to be used for such uses and purposes specified above. In the event that we draw on any Letter of Credit so established in an amount in excess of the actual amounts required for items a), b), or c) above, or in the case of a draw against any fund established as outlined above, any amounts that are subsequently determined not to be due to us shall be promptly returned to you by us. In addition, in the event that we draw on any fund established as outlined above, in an amount in excess of the actual amounts required, we shall pay you interest on the amounts held at a rate equal to the prime rate of interest or the rate permitted by an arbitration panel operating under Article IX of this Agreement, whichever is greater. The amounts drawn under any Letter of Credit will be applied without diminution because of the insolvency of either party. The financial institution shall have no responsibility whatsoever in connection with the propriety of withdrawals we make or the disposition of funds withdrawn, except to see that withdrawals are made only upon the order of our properly authorized representatives. Not withstanding the preceding, should you not be able to obtain a qualifying Letter of Credit or ~~amendment)~~other reserve credit security acceptable to us, ~~which shall~~ we will permit you to assign and novate your position as reinsurer under this Agreement to another reinsurer. Our written consent must be ~~irrevocable~~ provided in response to your proposal to assign and ~~automatically renewable as~~ novate your position under this Agreement, before this can occur. In addition, any proposed reinsurer must have an A.M. Best rating of (A) or better at the time of the transfer and the proposed reinsurer must accept the novation of this Agreement and all amendments that are attached to it, without any material modification to the substantive terms of the Agreement. We will not unreasonably deny novation proposals presented by you if all criteria above ~~provided through the Lease Expiration Date upon the same terms as the expiring~~ are met. Should you not be able to obtain a qualifying Letter of Credit or ~~such~~ other ~~terms as may be~~ reserve credit security acceptable to ~~Landlord~~ us, and should both parties not be able to come to agreement on novation proposals, and as a result we are not able to take credit on our Annual Statement for all or part of the coverage we ceded to you, then we may recapture the business ceded under this Agreement. In that event, both parties will negotiate in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with good faith the terms of ~~this Article 27~~a mutually agreed recapture of the reinsurance provided hereunder, ~~and~~ consisting of the ~~entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”)~~ appropriate amount of net reserves to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord in respect of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950reinsured amount being recaptured.

Appears in 1 contract

Samples: Pool Reinsurance Agreement (Nassau Life Variable Universal Life Account)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after~~ Promptly following the ~~mutual execution~~ Closing, Seller and Purchaser shall deliver joint written notice to the Issuing Bank of the effective delivery of ~~this Lease, Tenant shall deliver to Landlord, as collateral for~~ funds by Purchaser at the ~~full~~ Closing and ~~faithful performance by Tenant of all of~~ releasing the Issuing Bank from its obligations under the Letter of Credit. (b) In the event that the Closing does not occur due to the valid termination of this ~~Lease, an irrevocable and unconditional negotiable letter~~ Agreement by Seller: (i) Seller shall deliver written notice to the Issuing Bank releasing the Issuing Bank from its obligations under the Letter of ~~credit~~ Credit on the date which is three months after the date of such valid termination (the “Claim Deadline”) unless prior to the Claim Deadline Seller has delivered written notice to Purchaser of a claim against Purchaser for breach of this Agreement, together with reasonable detail regarding the basis of such claim and setting forth the aggregate amount claimed by Seller (such amount, the “Disputed Claim Amount”). (ii) Seller shall deliver written notice to the Issuing Bank releasing the Issuing Bank from its obligations under the Letter of Credit at such time as all pending claims for Purchaser’s breach of this Agreement have been finally resolved and satisfied and are not subject to appeal. (c) In the event that the Closing does not occur due to the valid termination of this Agreement by Purchaser: (i) Seller shall deliver written notice to the Issuing Bank releasing the Issuing Bank from its obligations under the Letter of Credit on the Claim Deadline unless prior to the Claim Deadline Seller has delivered written notice to Purchaser (x) that Seller has disputed the valid termination of this Agreement and (y) that Seller has a claim against Purchaser for breach of this Agreement, together with reasonable detail regarding the basis of such claim and setting forth the Disputed Claim Amount. (ii) Seller shall deliver written notice to the Issuing Bank releasing the Issuing Bank from its obligations under the Letter of Credit at such time as all pending claims regarding (x) valid termination of this Agreement by Purchaser and (y) Purchaser’s breach of this Agreement, in each case have been finally resolved and satisfied and are not subject to appeal. (d) The parties agree that, in the case of a drawing upon the Letter of Credit by Seller resulting from a Demand (as defined in the Letter of Credit”)) in the form of Option B, Seller shall instruct the Issuing Bank to make payment to an escrow account specified by Seller, which account shall be governed by an escrow agreement substantially in the form attached hereto as Exhibit ~~G hereto and made a part hereof~~C, ~~and containing~~ with such modifications or changes as may be requested by the ~~terms required herein, payable in~~ escrow agent party thereto (the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“~~LC Amount~~Escrow Agreement”). ~~Tenant shall provide Landlord~~ Concurrently with ~~a specimen Letter of Credit from~~ any Instruction (as defined in the ~~approved issuer prior~~ Escrow Agreement) delivered to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject escrow agent pursuant to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the ~~Letter~~ Escrow Agreement, Seller shall provide a copy of ~~Credit~~ such Instruction (~~and~~ as defined in the ~~bank issuing the same~~Escrow Agreement) ~~shall be acceptable~~ to ~~Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that:~~Purchaser. (ie) ~~Landlord~~At any time following the Claim Deadline, ~~or its then managing agent, shall have the right to draw down an amount up~~ to the ~~face~~ extent that the aggregate Disputed Claim Amount claimed by Seller in respect of any pending claims by Seller against Purchaser for breach of this Agreement is less than the amount ~~of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s~~ then ~~managing agent’s) written statement that Landlord is entitled to make such~~ available for drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, ~~in whole or in part~~ Seller shall deliver written notice to the ~~transferee and thereupon~~ Issuing Bank instructing the ~~Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply~~ Issuing Bank to ~~every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit,~~ reduce the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present then available for drawing under the Letter of Credit to the ~~issuing bank~~ aggregate Disputed Claim Amount claimed by Seller in ~~accordance with the terms~~ respect of any pending claims by Seller against Purchaser for breach of this ~~Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord~~ Agreement. (f) Concurrently with any Demand (as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit defined in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit) delivered to the Issuing Bank, ~~either prior to or following~~ Seller shall provide a ~~“draw” by Landlord~~ copy of ~~any portion of~~ such Demand (as defined in the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as ) to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950Purchaser.

Appears in 1 contract

Samples: Stock Purchase Agreement (White Mountains Insurance Group LTD)

Letter of Credit. ~~Within forty-five (45) days after~~ Alternatively, and in lieu of the ~~mutual~~ Performance Deposit hereinabove provided, Concessionaire may deposit with the State, upon Concessionaire's execution and delivery of this ~~Lease, Tenant shall deliver to Landlord~~Agreement, as ~~collateral~~ Performance for the full and ~~faithful~~ prompt performance by ~~Tenant~~ Concessionaire of all of ~~its~~ Concessionaire's obligations ~~under this Lease~~hereunder, an ~~irrevocable and unconditional negotiable~~ irrevocable, unconditional, transferable letter of credit (the “"Letter of Credit”"), in substantially in the form attached as Exhibit G L hereto and made a part hereof, ~~and containing the terms required herein, payable in the State of California, running~~ in favor of ~~Landlord, issued by~~ the State from a ~~solvent~~ bank ~~reasonably~~ approved by ~~Landlord under the supervision of the Superintendent of Banks of~~ the State (which bank shall have a Fitch rating of ~~California~~"A+" or better, shall have a branch office located in the Honolulu, Hawaii metropolitan area, and shall not appear on any "troubled" or "distressed" bank or financial institution lists maintained or published by the Federal Deposit Insurance Corporation (“FDIC”), any other governmental entity or agency with jurisdiction over the issuing bank, or ~~a National Banking Association, in the initial amount of $[***] (“LC Amount”~~any generally-recognized private bank rating entity or company)~~. Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease~~. The Letter of Credit shall ~~be:~~ provide for Performance in the initial amount of 00 Dollars ($ .00). Whether or not this Agreement or Concessionaire's right to possession hereunder has been terminated, (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a ~~transfer~~ default under any of ~~Landlord’s interest~~ the terms, covenants and conditions of this Agreement, (b) in the ~~Building~~event Concessionaire has filed (or there has been filed against Concessionaire) a petition for bankruptcy protection or other protection from its creditors under any applicable and available law which has not been dismissed or discharged, ~~Landlord shall transfer~~ or in the ~~Letter~~ event Concessionaire files a general assignment for the benefit of ~~Credit~~its creditors, or (c) the issuing bank is placed in receivership or similar position by the FDIC or any other governmental entity or agency with jurisdiction over the issuing bank, or otherwise appears on any "troubled" or "distressed" bank or financial institution lists maintained or published by the FDIC, any other governmental entity or agency with jurisdiction over the issuing bank, or any generally-recognized private bank rating entity or company, then, in ~~whole or in part to~~ any such event, the ~~transferee~~ State may at once and ~~thereupon the Landlord shall,~~ without any ~~further agreement between the parties,~~ notice whatsoever to Concessionaire be ~~released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply~~ entitled to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of draw down on the Letter of Credit ~~shall be less than~~ and apply such resulting sums toward the ~~LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s)~~ cure of ~~credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and~~ any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by ~~Tenant. Tenant further covenants and warrants that it will neither assign nor encumber~~ Concessionaire under this Agreement or toward any damages to which the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit State is entitled pursuant to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950Agreement.

Appears in 1 contract

Samples: Concession Agreement

Letter of Credit. ~~Within forty-five (45)~~ On or before 30 days ~~after~~ prior to the ~~mutual execution and delivery~~ anticipated date of ~~this Lease~~---------------- substantial completion of the improvements to be performed pursuant to Section 29, Tenant shall deliver to Landlord, as ~~collateral~~ security for the ~~full and faithful~~ performance ~~by Tenant~~ of ~~all of its~~ Tenant's obligations under ~~this Lease~~the lease, an unconditional, irrevocable ~~and unconditional negotiable~~ letter of credit in the amount of $200,000 (the “"Letter of Credit”)") issued to Landlord by a reputable commercial bank reasonably acceptable to Landlord having offices in the Philadelphia or Wilmington area, which Letter of Credit shall be in substantially in the form attached hereto as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. "F." The Letter of Credit shall ~~be: (a) at sight and irrevocable; (b) maintained in effect for the entire period~~ have a term of not less than 1 year from the ~~date~~ Commencement Date and Tenant shall cause renewals of ~~execution of this Lease through the date which is sixty (60) days following the Termination Date (“~~such Letter of Credit ~~Expiration Date”), subject~~ for not less than 1 year periods to be delivered to Landlord at least 30 days prior to the ~~last paragraph of this Article 27, provide that the~~ original or any extended expiration date of the Letter of ~~Credit shall be no earlier than~~ Credit. In the ~~Letter of Credit Termination Date or provide for automatic~~ event Landlord has not received any renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) 15 days prior to the then expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27date thereof, Landlord shall have the right to present the Letter of Credit for payment and to hold the ~~issuing bank~~ proceeds in ~~accordance with~~ cash pursuant to the terms of ~~this Article 27,~~ Section 28 of the lease. At any time that Landlord has the right to exercise its rights and ~~the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance~~ remedies based upon an event of ~~all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any~~ default by Tenant under ~~this Lease pending Tenant’s delivery~~ the lease, Landlord may, in addition to all of its other rights and remedies provided for in the lease, present the Letter of Credit for payment and apply the proceeds thereof (or cash held by Landlord in lieu thereof as above set forth) on account of sums due to Landlord of under the ~~required replacement letter of credit in~~ lease. In the ~~LC Amount~~ event Tenant shall fully and ~~otherwise complying~~ faithfully comply with all of the ~~provisions~~ covenants, agreements and conditions of ~~this Article 27~~the lease, Landlord shall return the Letter of Credit, undrawn (or the proceeds thereof if the Letter of Credit was previously presented for payment), to Tenant as herein set forth. Provided Tenant is not then and has not been in default under the lease, the amount of the Letter of Credit shall be reduced to the following amounts at the indicated times: Upon payment of the monthly installment of Rent due for the 37th full month after the Commencement Date - $157,891.00. Upon ~~delivery~~ payment of ~~such replacement letter~~ the monthly installment of ~~credit~~Rent due for the 49th full month after the Commencement Date - $141,487.00. Upon payment of the monthly installment of Rent due for the 61st full month after the Commencement Date - $123,367.00. R-6 Upon payment of the monthly installment of Rent due for the 73rd full month after the Commencement Date - $103,348.00. Upon payment of the monthly installment of Rent due of the 85th full month after the Commencement Date - $81,234.00. Upon payment of the monthly installment of Rent due for the 97th full month after the Commencement Letter, ~~any Cash Collateral held by Landlord~~ the Letter of Credit shall no longer be required and shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Lease Agreement (Astropower Inc)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after~~ Simultaneously with the ~~mutual execution and~~ delivery of ~~this Lease~~the Notes to the original purchasers thereof, ~~Tenant shall~~ the Issuer has caused the Credit Obligor to deliver to ~~Landlord, as collateral for~~ the ~~full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (~~Trustee the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit ~~shall be:~~ will terminate on the Stated Expiration Date, subject to extension (aif applicable) ~~at sight and irrevocable;~~by the Credit Obligor. (b) ~~maintained in effect for the entire period~~ The Issuer may at any time and from ~~the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject~~ time to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall time deliver a ~~new~~ Substitute Letter of Credit to ~~Landlord at least thirty~~ the Trustee in substitution for the Existing Letter of Credit, provided that (301) Notice of any intended delivery of a Substitute Letter of Credit and the proposed issuer and effective date thereof is given (i) by the Issuer to the Trustee not less than 45 days prior to the proposed effective date of such Substitute Letter of Credit (unless a shorter period shall be satisfactory to the Trustee and enable the Trustee to comply with this Section), and (ii) by the Trustee to the Holders, or, if the Securities Depository or Securities Depository Nominee is the Holder, as provided in the Letter of Representation, not less than 30 days prior to the proposed effective date of such Substitute Letter of Credit; and (2) such Substitute Letter of Credit complies with the applicable conditions set forth in subsection (d) of this Section and (3) simultaneously with the delivery of such Substitute Letter of Credit the Issuer delivers to the Trustee any related documentation required by subsection (e) of this Section (the "Related Documentation"). (c) The Issuer may, but shall not be required to, deliver a Substitute Letter of Credit to the Trustee prior to the expiration of the then Existing Letter of Credit; provided, however, that if a Substitute Letter of Credit ~~without any action whatsoever on~~ and the ~~part~~ Related Documentation are not delivered to the Trustee not less than 30 days prior to the Stated Expiration Date of ~~Landlord; (c)~~ the then Existing Letter of Credit, the Notes shall be subject to ~~the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and~~a Mandatory Tender. (d) ~~fully assignable by Landlord~~ Each Substitute Letter of Credit delivered to the Trustee pursuant to this Section must meet the following criteria: (1) such Substitute Letter of Credit must have an effective date not less than 30 days prior to the stated Expiration Date of the then Existing Letter of Credit, (2) such Substitute Letter of Credit must be substantially in the same form and of the same tenor as the Letter of Credit, except that such Substitute Letter of Credit must provide for the payment of interest on the Notes (or the interest portion of the purchase price of Notes tendered, or deemed tendered, for purchase) at the Maximum Rate computed on the interest rate basis then applicable as provided in Section 3.01(g), for not less than 56 days, (3) if such Substitute Letter of Credit is being delivered in connection with ~~any number~~ a conversion of ~~transfers of Landlord’s~~ the interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition rate on the Notes to ~~the foregoing~~a Fixed Rate, the ~~form and terms of the Letter of Credit (and the bank issuing the same)~~ effective date shall be ~~acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that:~~not later than the Conversion Date, (i4) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make if such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Substitute Letter of Credit will be ~~honored by~~ effective during a Fixed Rate Period when the ~~issuing bank without inquiry as~~ Notes are subject to optional redemption, such Substitute Letter of Credit must provide for payment of the maximum redemption premium payable with respect to the ~~accuracy thereof and regardless of whether the Tenant disputes the content of such statement;~~ Notes, and (~~iii~~5) such Substitute Letter of Credit must have a Stated Expiration Date that is (i) the same calendar day in the ~~event~~ same calendar month as the expiration date of the then existing Letter of Credit being replaced and (ii) not sooner than one year after its effective date; provided, however, that any Substitute Letter of Credit that is to be substituted for an Existing Letter of Credit that is effective during a ~~transfer~~ Fixed Rate Period must have a Stated Expiration Date not sooner than the Stated Expiration Date of ~~Landlord’s interest in the Building, Landlord shall transfer the~~ such Existing Letter of Credit~~, in whole or in part~~ . (e) Each Substitute Letter of Credit delivered to the ~~transferee and thereupon~~ Trustee must be accompanied by the ~~Landlord shall~~following, ~~without~~ to the extent applicable: (1) if any ~~further agreement between~~ Rating Agency maintains a rating with respect to the ~~parties, be released by Tenant from all liability therefor, and it is agreed that~~ Notes at the ~~provisions hereof shall apply to every transfer or assignment~~ time of ~~the whole or any portion~~ delivery of ~~said~~ such Substitute Letter of Credit to the Trustee, written evidence from each such Rating Agency to the effect that the substitution of the proposed Substitute Letter of Credit will not, by itself, result in a ~~new landlord. If~~reduction or withdrawal of its rating then assigned to the Notes, (2) an Opinion of Counsel for the issuer of such Substitute Letter of Credit stating in effect that such Substitute Letter of Credit (1) is a valid and binding obligation of the issuer thereof and (2) is exempt from registration under the Securities Act of 1933, as ~~a result~~ amended. (f) At the close of business on the effective date of any ~~application or use by Landlord of all or any part of the~~ Substitute Letter of Credit, the ~~amount~~ Trustee shall return the Existing Letter of Credit to the issuer thereof, provided that any draws on such Existing Letter of Credit made on or prior to such date have been honored. Any draws that, under the terms of the Indenture, are to be made on the Letter of Credit on or prior to the effective date of a Substitute Letter of Credit shall be ~~less~~ made under the Existing Letter of Credit. Not later than the ~~LC Amount, Tenant shall, within ten (10)~~ close of business ~~days thereafter, provide Landlord with an additional letter(s)~~ on the effective date of ~~credit, in an amount equal to the deficiency (or~~ a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Substitute Letter of Credit, ~~or any part thereof and~~ the Issuer shall certify in writing to the Trustee that ~~neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality~~ all obligations of the ~~foregoing, if~~ Issuer to the issuer of the Existing Letter of Credit ~~expires earlier than~~ for reimbursement of amounts drawn thereunder have been satisfied, and upon receipt of such evidence any Pledged Notes held by the ~~Lease Expiration Date, Landlord will accept a renewal letter of credit~~ Trustee or ~~substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to~~ the ~~expiration~~ Tender Agent for the benefit of the issuer of the Existing Letter of Credit ~~or amendment), which~~ shall be ~~irrevocable and automatically renewable as above provided through the Lease Expiration Date~~ delivered to, or upon the ~~same terms as~~ order of, the ~~expiring~~ Issuer. (g) If the Trustee accepts a Substitute Letter of Credit or as herein provided, then, unless such ~~other terms as may be acceptable to Landlord in its reasonable discretion. However, if the~~ Substitute Letter of Credit ~~is not timely renewed or~~ was described in a ~~substitute or amendment~~ notice of Mandatory Tender, the Trustee shall send written notice of such substitution to ~~letter~~ the Noteholders. (h) If Notes are redeemed prior to maturity, the Trustee shall take any action necessary to reduce the interest portion of ~~credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present~~ the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s defaultMaximum Interest Coverage, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950therein defined.

Appears in 1 contract

Samples: Trust Indenture (Display Technologies Inc)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after~~ Subject to and upon the ~~mutual execution~~ terms and ~~delivery of this Lease, Tenant shall deliver to Landlord, as collateral for the full~~ conditions contained herein and ~~faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially~~ in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit ~~from~~ Documents, at the ~~approved issuer prior~~ request of a Borrower (or Administrative Borrower on behalf of such Borrower), Agent agrees to cause Issuing Bank to issue, and Issuing Bank agrees to issue, for the ~~execution~~ account of such Borrower one or more Letters of Credit, for the ratable risk of each Lender according to its Pro Rata Share, containing terms and conditions acceptable to Agent and Issuing Bank. From and after the Closing Date, all Existing Letters of Credit outstanding on the Closing Date shall be deemed to be issued and outstanding, and to constitute Letters of Credit, under this ~~Lease. The~~ Agreement and all Letter of Credit Obligations (as defined in the Existing Loan Agreement) outstanding on the Closing Date shall ~~be: (a) at sight~~ be deemed to be and ~~irrevocable;~~constitute Letter of Credit Obligations under this Agreement, and shall be subject to all of the terms and conditions hereof. (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of The Borrower requesting such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (~~and the bank issuing the same~~or Administrative Borrower on behalf of such Borrower) shall give Agent and Issuing Bank two (2) Business Days’ prior written notice of such Borrower’s request for the issuance of a Letter of Credit. Such notice shall be ~~acceptable to Landlord, in Landlord’s reasonable discretion,~~ irrevocable and shall ~~provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have~~ specify the ~~right to draw down an amount up to the~~ original face amount of the Letter of Credit ~~upon~~ requested, the ~~presentation~~ effective date (which date shall be a Business Day and in no event shall be a date less than ten (10) days prior to the ~~issuing bank~~ end of ~~Landlord’s~~ the then current term of this Agreement) of issuance of such requested Letter of Credit, whether such Letter of Credit may be drawn in a single or in partial draws, the date on which such requested Letter of Credit is to expire (~~or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent~~ which date shall be a ~~corporation, partnership or other entity, then such statement~~ Business Day and shall not be ~~signed by an officer (if a corporation~~more than one year from the date of issuance), ~~a general partner (if a partnership)~~the purpose for which such Letter of Credit is to be issued, ~~or any authorized party (if another entity); (ii)~~ and the beneficiary of the requested Letter of Credit. The Borrower requesting the Letter of Credit ~~will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content~~ (or Administrative Borrower on behalf of such ~~statement; and (iii~~Borrower) in shall attach to such notice the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part proposed terms of the Letter of Credit. The renewal or extension of any Letter of Credit shall, for purposes hereof be treated in all respects the ~~amount~~ same as the issuance of a new Letter of Credit hereunder. (c) In addition to being subject to the satisfaction of the applicable conditions precedent contained in Section 4 hereof and the other terms and conditions contained herein, no Letter of Credit shall be available unless each of the following conditions precedent have been satisfied in a manner satisfactory to Agent: (i) the Borrower requesting such Letter of Credit (or Administrative Borrower on behalf of such Borrower) shall have delivered to Issuing Bank at such times and in such manner as Issuing Bank may require, an application, in form and substance satisfactory to Issuing Bank and Agent, for the issuance of the Letter of Credit and such other Letter of Credit Documents as may be required pursuant to the terms thereof, and the form and terms of the proposed Letter of Credit shall be ~~less than~~ satisfactory to Agent and Issuing Bank, (ii) as of the ~~LC Amount~~date of issuance, ~~Tenant shall~~no order of any court, arbitrator or other Governmental Authority shall purport by its terms to enjoin or restrain money center banks generally from issuing letters of credit of the type and in the amount of the proposed Letter of Credit, and no law, rule or regulation applicable to money center banks generally and no request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over money center banks generally shall prohibit, or request that Issuing Bank refrain from, the issuance of letters of credit generally or the issuance of such Letter of Credit, (iii) after giving effect to the issuance of such Letter of Credit, the Letter of Credit Obligations shall not exceed the Letter of Credit Limit, and (iv) the Excess Availability, prior to giving effect to any Reserves with respect to such Letter of Credit, on the date of the proposed issuance of any Letter of Credit shall be equal to or greater than: (A) if the proposed Letter of Credit is for the purpose of purchasing Inventory that would constitute Eligible Inventory but for the fact that it is or will be in transit to the premises of a Borrower located with the United States, and the documents of title with respect thereto are consigned and delivered to Issuing Bank at a location in the United States, the sum of (1) the percentage equal to one hundred percent (100%) minus the then applicable percentage with respect to Eligible Inventory set forth in the definition of the term Borrowing Base multiplied by the Value of such Eligible Inventory, plus (2) freight, taxes, duty and other amounts which Agent estimates must be paid in connection with such Inventory upon arrival and for delivery to one of such Borrower’s locations for Eligible Inventory within ~~ten~~ the United States of America and (10B) ~~business days thereafter~~if the proposed Letter of Credit is for any other purpose or the documents of title are not consigned and delivered to Issuing Bank at a location in the United States in connection with a Letter of Credit for the purpose of purchasing Inventory, ~~provide Landlord with an additional letter(s) of credit, in~~ an amount equal to ~~the deficiency~~ one hundred (~~or a replacement letter of credit in the total amount of the LC Amount~~100%) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration percent of the Letter of Credit ~~or amendment)~~Obligations with respect thereto. Effective on the issuance of each Letter of Credit, ~~which~~ a Reserve shall be ~~irrevocable~~ established in the applicable amount set forth in Section 2.2(c)(iv)(A) or Section 2.2(c)(iv)(B). (d) Except in Agent’s discretion, with the consent of all Lenders, the amount of all outstanding Letter of Credit Obligations shall not at any time exceed the Letter of Credit Limit. (e) Each Borrower shall reimburse immediately Issuing Bank for any draw under any Letter of Credit issued for the account of such Borrower and ~~automatically renewable as above provided through~~ pay Issuing Bank the ~~Lease Expiration Date upon~~ amount of all other charges and fees payable to Issuing Bank in connection with any Letter of Credit issued for the ~~same terms as the expiring~~ account of such Borrower immediately when due, irrespective of any claim, setoff, defense or other right which such Borrower may have at any time against Issuing Bank or any other Person. Each drawing under any Letter of Credit or other amount payable in connection therewith when due shall constitute a request by the Borrower for whose account such Letter of Credit was issued to Agent for a Prime Rate Loan in the amount of such drawing or other ~~terms~~ amount then due, and shall be made by Agent on behalf of Lenders as a Loan (or Special Agent Advance, as the case may be). The date of such Loan shall be ~~acceptable~~ the date of the drawing or as to ~~Landlord~~ other amounts, the due date therefor. Any payments made by or on behalf of Agent or any Lender to Issuing Bank and/or related parties in ~~its reasonable discretion~~connection with any Letter of Credit shall constitute additional Loans to such Borrower pursuant to this Section 2 (or Special Agent Advances as the case may be). (f) Borrowers and Guarantors shall indemnify and hold Agent and Lenders harmless from and against any and all losses, claims, damages, liabilities, costs and expenses which Agent or any Lender may suffer or incur in connection with any Letter of Credit and any documents, drafts or acceptances relating thereto, including any losses, claims, damages, liabilities, costs and expenses due to any action taken by Issuing Bank or correspondent with respect to any Letter of Credit, except for such losses, claims, damages, liabilities, costs or expenses that are a direct result of the gross negligence or willful misconduct of Agent or any Lender as determined pursuant to a final non-appealable order of a court of competent jurisdiction. ~~However~~Each Borrower and Guarantor assumes all risks with respect to the acts or omissions of the drawer under or beneficiary of any Letter of Credit and for such purposes the drawer or beneficiary shall be deemed such Borrower’s agent. Each Borrower and Guarantor assumes all risks for, and agrees to pay, all foreign, Federal, State and local taxes, duties and levies relating to any goods subject to any Letter of Credit or any documents, drafts or acceptances thereunder. Each Borrower and Guarantor hereby releases and holds Agent and Lenders harmless from and against any acts, waivers, errors, delays or omissions with respect to or relating to any Letter of Credit, except for the gross negligence or willful misconduct of Agent or any Lender as determined pursuant to a final, non-appealable order of a court of competent jurisdiction. The provisions of this Section 2.2(f) shall survive the payment of Obligations and the termination of this Agreement. (g) In connection with Inventory purchased pursuant to any Letter of Credit, Borrowers and Guarantors shall, at Agent’s request, instruct all suppliers, carriers, forwarders, Customs Brokers, warehouses or others receiving or holding cash, checks, Inventory, documents or instruments in which Agent holds a security interest that upon Agent’s request, such items are to be delivered to Agent and/or subject to Agent’s order, and if they shall come into such Borrower’s or Guarantor’s possession, to deliver them, upon Agent’s request, to Agent in their original form. Except as otherwise provided herein, Agent shall not exercise such right to request such items so long as no Default or Event of Default shall exist or have occurred and be continuing. Except as Agent may otherwise specify, Borrowers and Guarantors shall designate Issuing Bank as the consignee on all bills of lading and other negotiable and non-negotiable documents. (h) Each Borrower and Guarantor hereby irrevocably authorizes and directs Issuing Bank to name such Borrower or Guarantor as the account party therein and to deliver to Agent all instruments, documents and other writings and property received by Issuing Bank pursuant to the Letter of Credit ~~is not timely renewed or a substitute or amendment~~ and to ~~letter of credit is not timely received, or if Tenant fails~~ accept and rely upon Agent’s instructions and agreements with respect to ~~maintain~~ all matters arising in connection with the Letter of Credit ~~in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present~~ or the Letter of Credit Documents with respect thereto. Nothing contained herein shall be deemed or construed to grant any Borrower or Guarantor any right or authority to pledge the credit of Agent or any Lender in any manner. Borrowers and Guarantors shall be bound by any reasonable interpretation made in good faith by Agent, or Issuing Bank under or in connection with any Letter of Credit or any documents, drafts or acceptances thereunder, notwithstanding that such interpretation may be inconsistent with any instructions of any Borrower or Guarantor. (i) Immediately upon the issuance or amendment of any Letter of Credit, each Lender shall be deemed to have irrevocably and unconditionally purchased and received, without recourse or warranty, an undivided interest and participation to the ~~issuing bank~~ extent of such Lender’s Pro Rata Share of the liability with respect to such Letter of Credit and the obligations of Borrowers with respect thereto (including all Letter of Credit Obligations with respect thereto). Each Lender shall absolutely, unconditionally and irrevocably assume, as primary obligor and not as surety, and be obligated to pay to Issuing Bank therefor and discharge when due, its Pro Rata Share of all of such obligations arising under such Letter of Credit. Without limiting the scope and nature of each Lender’s participation in any Letter of Credit, to the extent that Issuing Bank has not been reimbursed or otherwise paid as required hereunder or under any such Letter of Credit, each such Lender shall pay to Issuing Bank its Pro Rata Share of such unreimbursed drawing or other amounts then due to Issuing Bank in connection therewith. (j) The obligations of Borrowers to pay each Letter of Credit Obligations and the obligations of Lenders to make payments to Agent for the account of Issuing Bank with respect to Letters of Credit shall be absolute, unconditional and irrevocable and shall be performed strictly in accordance with the terms of this ~~Article 27~~Agreement under any and all circumstances, ~~and~~ whatsoever, notwithstanding the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result occurrence or continuance of any ~~default~~ Default, Event of Default, the failure to satisfy any other condition set forth in Section 4 or any other event or circumstance. If such amount is not made available by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credita Lender when due, ~~any Cash Collateral held by Landlord~~ Agent shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to ~~any~~ recover such amount on demand from such Lender with interest ~~earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods~~thereon, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw each day from the ~~Letter~~ date such amount was due until the date such amount is paid to Agent at the interest rate then payable by any Borrower in respect of ~~Credit~~Loans that are Prime Rate Loans. ~~No condition~~ Any such reimbursement shall not relieve or ~~term~~ otherwise impair the obligation of ~~this Lease shall be deemed~~ Borrowers to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the reimburse Issuing Bank under any Letter of Credit or make any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950other payment in connection therewith.

Appears in 1 contract

Samples: Loan and Security Agreement (Delta Apparel Inc)

Letter of Credit. 17.1 Within ~~forty-five~~ fourteen (4514) ~~days after~~ days’ of the ~~mutual execution and delivery~~ Execution Date of this ~~Lease~~Sublease, ~~Tenant~~ Subtenant shall deliver to ~~Landlord~~Sublandlord, as collateral for the full ~~and faithful~~ performance by ~~Tenant~~ Subtenant of all of its obligations under this ~~Lease~~Sublease and for all losses and damages Sublandlord may suffer (or which Sublandlord reasonably estimates it may suffer) as a result of Subtenant’s failure to comply with one or more provisions of this Sublease, ~~an irrevocable and unconditional negotiable~~ including, but not limited to, any post lease termination damages under Section 1951.2 of the California Civil Code, a standby, unconditional, irrevocable, transferable (with Subtenant responsible for the payment of any transfer fee or charge imposed by the Issuing Bank, as defined below) letter of credit (the “Letter of Credit”), ) substantially in ~~the~~ a form ~~attached as Exhibit G hereto and made a part hereof,~~ reasonably approved in writing in advance by Sublandlord and containing the terms required herein, ~~payable~~ in the ~~State~~ amount specified in Section 1.12 (the “Letter of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Credit Amount”), naming Sublandlord as beneficiary, issued (or confirmed) by a financial institution reasonably acceptable to Sublandlord (the “Issuing Bank”), permitting multiple and partial draws thereon from a location in San Francisco, California (or, alternatively, permitting draws via overnight courier or facsimile in a manner acceptable to Sublandlord), and otherwise in form acceptable to Sublandlord in its reasonable discretion. ~~Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease~~Sublandlord hereby approves Silicon Valley Bank as an Issuing Bank. The Letter of Credit shall ~~be: (a)~~ be “callable” at ~~sight~~ sight, permit partial draws and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”)multiple presentations and drawings, ~~subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall~~ and be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) ), International Chamber of Commerce Publication #~~600; and~~ 500, or the International Standby Practices-ISP 98, International Chamber of Commerce Publication #590. In the event of an assignment by Subtenant of its interest in this Sublease (~~d) fully assignable~~ and irrespective of whether Sublandlord’s consent is required for such assignment), the acceptance of any replacement or substitute letter of credit by ~~Landlord~~ Sublandlord from the assignee shall be subject to Sublandlord’s prior written approval, in Sublandlord’s reasonable discretion, and the reasonable attorney’s fees incurred by Sublandlord in connection with such determination shall be payable by Subtenant to Sublandlord within ten (10) days of billing. Subtenant shall cause the Letter of Credit to be continuously maintained in effect (whether through replacement, amendment, renewal or extension) in the Letter of Credit Amount through the date (the “Final LC Expiration Date”) that is the later to occur of (x) the date that is ninety (90) days after the scheduled expiration of the Sublease Term and (y) the date that is ninety (90) days after Subtenant vacates the Sublease Premises and completes any ~~number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs~~ restoration or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATIONrepair obligations. In ~~addition to~~ furtherance of the foregoing, Sublandlord and Subtenant agree that the ~~form and terms~~ Letter of Credit shall contain a so-called “evergreen provision,” whereby the Letter of Credit will automatically be renewed unless at least thirty (30) days’ prior written notice of non-renewal is provided by the Issuing Bank to Sublandlord; provided, however, that the final expiration date identified in the Letter of Credit, beyond which the Letter of Credit shall not automatically renew, shall not be earlier than the Final LC Expiration Date. Subtenant shall neither assign nor encumber the Letter of Credit or any part thereof. Neither Sublandlord nor its successors or assigns will be bound by any assignment, encumbrance, attempted assignment or attempted encumbrance by Subtenant in violation of this Article 17. If the Letter of Credit held by Sublandlord expires earlier than the Final LC Expiration Date (whether by reason of a stated expiration date or a notice of termination or non-renewal given by the Issuing Bank), Subtenant shall deliver a new or amended Letter of Credit or certificate of renewal or extension to Sublandlord not later than thirty (30) days prior to the expiration or termination of the Letter of Credit ~~(and~~ then held by Sublandlord. Any renewal, amended or replacement Letter of Credit shall comply with all of the ~~bank issuing the same) shall be acceptable~~ provisions of this Sublease. 17.2 Sublandlord without prejudice to ~~Landlord,~~ any other remedy provided in ~~Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord,~~ this Sublease or ~~its then managing agent~~by law, shall have the right to draw down an amount up to the face amount of the Letter of Credit ~~upon~~ if any of the ~~presentation to the issuing bank of Landlord’s~~ following shall have occurred or be applicable (each, a “Draw Event”): (i) Subtenant breaches or ~~Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing~~ defaults in its obligations under this ~~Lease~~Sublease beyond applicable notice and cure periods; provided however if Sublandlord is prevented from delivering a notice of default to Subtenant for any reason, ~~it being understood that if Landlord~~ including without limitation, because Subtenant has filed a voluntary petition or ~~its managing agent be a corporation, partnership~~ an involuntary petition has been filed against Subtenant under the Bankruptcy Code (as defined below) then no notice or ~~other entity, then such statement~~ cure period shall be ~~signed by an officer~~ applicable, or (if ii) Subtenant has filed a ~~corporation)~~voluntary petition under the U. S. Bankruptcy Code or any State bankruptcy code (collectively, ~~a general partner (if a partnership~~“Bankruptcy Code”), or ~~any authorized party~~ (~~if another entity);~~ iii) an involuntary petition has been filed against Subtenant under the Bankruptcy Code, or (iiiv) Subtenant executes an assignment for the benefit of creditors, or (v) Subtenant is placed into receivership or conservatorship, or becomes subject to similar proceedings under Federal or State law, or (vi) the Issuing Bank has notified Sublandlord that the Letter of Credit will not be ~~honored by~~ renewed or extended through the ~~issuing bank without inquiry as~~ Final LC Expiration Date, or (vii) Subtenant fails to ~~the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of~~ timely provide a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said replacement Letter of Credit as required by the terms of this Article 17 (the events described in clauses (ii), (iii), (iv), and (v) above, collectively, being referred to ~~a new landlord~~herein as an “Insolvency Event”). IfUpon any such draw, ~~as a result of any application or~~ Sublandlord may use ~~by Landlord of~~ all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, proceeds as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result Section 17. 17.3 The proceeds of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit ~~and/or utilize the Cash Collateral, in part or in whole,~~ which are not used to ~~the extent necessary to cure any default of Tenant and/or to compensate Landlord~~ pay for ~~any and all~~ damages ~~of any kind or nature sustained~~ suffered by Sublandlord (or which ~~may~~ Sublandlord reasonably estimates it will suffer) (the “Unused Proceeds”) as described above shall constitute Sublandlord’s sole and separate property (and not Subtenant’s property or the property of Subtenant’s bankruptcy estate) and need not be ~~sustained by Landlord resulting~~ segregated from ~~Tenant’s default, as may be permitted by the express terms and conditions~~ any other funds of ~~this Lease~~Sublandlord. ~~Xxxxxx~~ Subtenant (i) agrees ~~not to interfere~~ that (A) Subtenant has no property interest whatsoever in ~~any way with payment to Landlord of~~ the proceeds ~~of the Letter of Credit~~from any such draw, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and ~~Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease~~ (B) such proceeds shall not be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” under the Security Deposit Laws (defined below), and (ii) waives all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit Laws. Any Unused Proceeds shall be paid by Sublandlord to Subtenant (x) upon receipt by Sublandlord of a replacement Letter of Credit in the full Letter of Credit Amount, which replacement Letter of Credit shall comply in all respects with the requirements of this Sublease, or (y) within thirty (30) days after the Final LC Expiration Date; provided, however, that if prior to the Final LC Expiration Date a voluntary petition is filed by Subtenant, or an involuntary petition is filed against Subtenant by any of Subtenant’s creditors, under the Bankruptcy Code, then Sublandlord shall not be obligated to make such payment in the amount of the Unused Proceeds until either all preference issues relating to payments under this Sublease have been resolved in such bankruptcy or reorganization case or such bankruptcy or reorganization case has been dismissed, in any case pursuant to a final court order not subject to appeal or any stay pending appeal. 17.4 If Subtenant is required to replace or provide a supplemental Letter of Credit under this Section 17 and, due to no fault of Subtenant and despite Subtenant’s diligent efforts, such Letter of Credit is not commercially available, or not available on commercially reasonable terms, Subtenant may deposit cash in the amount of the replacement or supplemental Letter of Credit required under this Section 17 with Sublandlord, within the ~~meaning~~ timeframe required by this Section 17 for such replacement or supplemental Letter of ~~California Civil Code~~ Credit (“Cash Deposit”). Subtenant’s Cash Deposit with Sublandlord as aforesaid shall satisfy Subtenant’s obligations under this Section ~~1950.7;~~17. Any amount so deposited by Tenant shall be held by Sublandlord and be treated as Unused Proceeds hereunder. 17.5 Notwithstanding anything herein to the contrary, provided the named Subtenant herein (fi.e NerdWallet, Inc.) ~~subject to~~ is the Subtenant and shall not have been default hereunder beyond any applicable notice and cure periods under any provision of this Sublease at any time, then provided Subtenant complies with the terms of this Section 17.5, the required amount of the Letter of Credit will be reduced as follows: (i) effective as of the beginning of the 13th month of the Sublease Term to $1,000,000.00, (ii) effective as of the beginning of the 25th month of the Sublease Term to $800,000.00, and (iii) effective as of the beginning of the 37th month of the Sublease Term to $600,000.00. The Letter of Credit, as it may be reduced in accordance with the foregoing, shall continue to be held by Landlord throughout the Sublease Term. Subtenant will provide a Letter of Credit that automatically xxxxx down consistent with the terms of this Section 17.5, but if not available, then following each such reduction, Subtenant shall deliver a replacement Letter of Credit in the reduced amount in form and substance as required by this Sublease and Sublandlord shall promptly thereafter return to Subtenant the prior Letter of Credit then held by Sublandlord. Notwithstanding anything to the contrary, if Subtenant commits a monetary default beyond applicable notice and cure periods after the date in which the Letter of Credit amount has been reduced pursuant to this Section ~~1950.7; or~~ 17.5, Sublandlord shall have the right to require that Subtenant reinstate the Letter of Credit to the original sum required under this Sublease upon ten (g10) ~~intended~~ days’ written notice to ~~serve as a “security deposit”~~ Subtenant, and Subtenant shall replace the existing Letter of Credit within ~~the meaning of~~ such ~~Section 1950~~ten (10) day period.

Appears in 1 contract

Samples: Sublease (Nerdwallet, Inc.)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after the mutual~~ On or before execution ~~and delivery~~ of this Lease, Tenant shall ~~deliver to Landlord~~deposit with Landlord a Letter of Credit ("L/C") in the amount of nine thousand sixty three dollars and eighty eight cents ($9,063.88) (as such amount may be reduced in accordance with Section 43.6, the "L/C Amount") as ~~collateral~~ security for the full and ~~faithful~~ punctual performance by Tenant of Tenant's covenants and obligations under this Lease. Tenant may, at its option, convert the entire cash security deposit balance to an L/C. If the amount referred to above and hereafter shall then mean the new amount for all purposes. (b) The L/C shall be (I) unconditional and irrevocable, (ii) issued by a bank acceptable to Landlord, (iii) payable at a branch located in New Jersey, (iv) payable to Landlord solely upon presentation of sight draft, (v) transferable by the beneficiary without additional charge, (vi) payable in multiple drafts, (vii) subject to Section 43.3, for a period commencing upon issuance and expiring no earlier than (the "L/C Expiration Date") and (viii) in form reasonably acceptable to Landlord. 43.2 If Tenant defaults in the performance and observance of any of the terms, covenants and conditions of this Lease (including, without limitation, the payment of Base Rent or, Additional Rent or any other sums due under this Lease, beyond the expiration of any applicable notice and grace period, Landlord may, at its option, draw upon the L/C, in whole or in part, or any funds then being held by Landlord as security or Tenant's obligations under this Lease, ~~an irrevocable~~ and ~~unconditional negotiable letter of credit (the “Letter of Credit”)~~use, substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, apply or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from retain all ~~liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole~~ or any portion of ~~said Letter of Credit~~ such money only to ~~a new landlord. If, as a result~~ the extent required for the payment of any ~~application~~ Basic Rent, or ~~use by Landlord of all~~ Additional Rent or any ~~part of~~ other sum as to which Tenant is in default whether such damages or deficiency accrue or accrues before or after summary proceedings or re-entry by Landlord. If Landlord draws upon the ~~Letter~~ L/C of Credit, Tenant shall deposit with Landlord within five (5) business days thereafter a supplemental or new L/C meeting the same requirements set forth in Section 43.1 (a) and (b), or cash in credit issues on behalf of Tenant and then held by Landlord pursuant to this Article XLIII plus the amount of ~~the Letter~~ any cash deposited by Tenant (but excluding any cash proceeds of ~~Credit~~ any L/C drawn by Landlord) shall not be less than the LC L/C Amount. In the event Tenant does not deposit with Landlord a supplemental or new L/C as provided hereinabove, Tenant ~~shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit,~~ shall be considered in ~~an amount equal to the deficiency (or a replacement letter of credit in the total amount~~ Default of the ~~LC Amount)~~ Lease and ~~any such additional (or replacement) letter of credit shall comply with~~ Landlord reserves all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, rights as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth contained in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Lease Agreement (Mim Corp)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after~~ If, under the ~~mutual execution and delivery of this Lease~~Engine Lease Agreement, ~~Tenant shall deliver~~ Lessee is required or elects to ~~Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “~~provide Lessor with a Letter of Credit”), the provisions of this Section shall apply. Any Letter of Credit provided by Lessee to Lessor will be issued and payable by a Pre-Approved Bank or another bank acceptable to Lessor in its sole and absolute discretion and in substantially in the form ~~attached as Exhibit G hereto~~ of Schedule 16 (Form of Letter of Credit) or in another form and ~~made a part hereof~~substance acceptable to Lessor in its sole and absolute discretion, ~~and containing the terms required herein~~and, ~~payable in the State of California, running in favor of Landlord,~~ if not issued by a ~~solvent~~ Pre-Approved Bank or by the New York branch of a major international bank ~~reasonably approved~~ acceptable to Lessor in its sole and absolute discretion from time to time, will be confirmed by ~~Landlord~~ and payable at the New York branch of a major international bank acceptable to Lessor in its sole and absolute discretion from time to time, and will be issued as security for all payment obligations of Lessee or any of its Affiliates to Lessor or any Lessee Affiliate under the ~~supervision~~ Lease and each of the ~~Superintendent~~ Transaction Agreements (including any and all Losses suffered or incurred by Lessor or any of ~~Banks~~ its Affiliates in respect of which Lessee or any of its Affiliates is obligated under the Lease or any of the ~~State~~ Transaction Agreements), which shall remain in full force and effect and may be drawn down by Lessor upon demand at any time or times following the occurrence of ~~California, or~~ a ~~National Banking Association, in~~ Significant Default until the ~~initial amount of $[***]~~ Required LC Expiry Date. (~~“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease.~~ b) The Letter of Credit ~~shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire~~ may have a validity period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days periods ending prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any feesRequired LC Expiry Date, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: provided that (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Creditshall, in ~~whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties~~each case, be ~~released by Tenant from all liability therefor~~renewed, ~~and it is agreed that the provisions hereof shall apply to every transfer~~ extended or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect reissued and delivered to ~~Landlord, as applicable,~~ Lessor not later than thirty (30) days prior to ~~the expiration~~ its expiry (provided that there shall be no duplication of ~~the~~ draw rights); and (ii) a Letter of Credit shall remain in force at all times up to the Required LC Expiry Date. (c) If at any time during the Term, Lessor reasonably determines that the current issuing or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if confirming bank for the Letter of Credit is ~~not timely renewed~~ no longer an acceptable issuing or confirming bank (by virtue of a material adverse change in its financial condition or a ~~substitute or amendment to letter~~ decrease in any credit rating of ~~credit is not timely received~~its long-term unsecured debt obligations) Lessor may notify Lessee of such fact and, ~~or if Tenant fails to maintain~~ in such event, Lessee shall within ten (10) Business Days after the ~~Letter~~ date of ~~Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present~~ such notice cause the Letter of Credit to ~~the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall~~ be ~~paid to and held~~ replaced by ~~Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as~~ a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit ~~and/or utilize the Cash Collateral,~~ issued by a Pre-Approved Bank or another bank acceptable to Lessor (in ~~part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any~~ its sole and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of absolute discretion). (d) If Lessor makes a drawing under the Letter of Credit, ~~either prior to or~~ Lessee shall, following a ~~“draw”~~ demand in writing by ~~Landlord of any portion of~~ Lessor specifying the ~~Letter of Credit~~amount to be replenished and stating in reasonable detail the amount and basis upon which such drawing was made, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from immediately cause the ~~Letter of Credit. No condition or term of this Lease shall be deemed to render~~ maximum amount available for drawing under the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be ~~or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject~~ restored to the ~~terms of~~ level at which it stood immediately prior to such ~~Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~drawing.

Appears in 1 contract

Samples: Engine Lease (Airtran Airways Inc)

Letter of Credit. Within ~~forty-~~five ~~(45)~~ business days after the ~~mutual execution and delivery of this Lease~~date hereof, Tenant shall ~~deliver~~ deposit with Landlord the Letter of Credit (defined below), which shall be held by Landlord in addition to ~~Landlord, as collateral for~~ the ~~full and faithful performance by Tenant of all of its~~ Security Deposit to secure Tenant's obligations under ~~this~~ the Lease. If an Event of Default occurs, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord ~~under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association~~may, in addition and without prejudice to all other rights and remedies, draw on the ~~initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen~~ Letter of Credit from ~~the approved issuer prior~~ time to time, up to the ~~execution~~ amount necessary to pay to Landlord Rent under the Lease (including, without limitation, Base Rent, Operating Expenses, and all amounts payable by Tenant under Sections 8,11 and 19 of ~~this~~ the Lease). The ~~Letter~~ receipt by Landlord of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date proceeds of the Letter of Credit shall not be deemed to cure or satisfy any Event of Default, and Landlord may still exercise any and all remedies available under the Lease or Law with the same effect as if such proceeds had not been received; however, in any action brought by Landlord to obtain a monetary judgment against Tenant, credit shall be given for all proceeds received by Landlord. As used herein, "LETTER OF CREDIT" shall mean a standby, unconditional, irrevocable, assignable, sight-draft letter of credit in the initial face amount of $600,000, (a) naming Landlord as beneficiary issued by a bank or financial institution that has a Standard & Poor's Corporation unsecured senior debt rating of "A" or better or an equivalent rating from another nationally-recognized rating agency (in either case, without regard to credit enhancements), that is otherwise acceptable to Landlord and that has banking offices in Dallas, Texas (or that has a confirming bank on which draws may be presented with a banking office in Dallas, Texas), (b) permitting partial draws thereon, (c) having an initial expiration date of no ~~earlier~~ less than one year after the date hereof, (d) expressly stating that it is assignable, and (e) otherwise being in form acceptable to Landlord (the term "Letter of Credit" shall include all renewals, reissuances, replacements and substitutions for the initial Letter of Credit). Upon any transfer of the Premises by Landlord, Tenant shall within ten days after Landlord's request cause the Letter of Credit ~~Termination Date or provide for automatic renewal thereof at least through~~ to be reissued, naming the transferee of the Premises as the beneficiary. Tenant shall from time to time cause the Letter of Credit ~~Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice~~ to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) be renewed no later than 30 days prior to ~~the~~ any expiration of date thereof; if Tenant fails timely to renew the Letter of Credit ~~without any action whatsoever on the part of Landlord; (c) subject~~ or fails to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be deliver a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said substitute Letter of Credit to a ~~new landlord~~transferee of Landlord as provided above, then Landlord may draw thereon for the entire balance, and retain the amounts so drawn as additional security for the performance of Tenant's obligations under the Lease. IfEach substitute, ~~as a result~~ reissued, renewal, and replacement Letter of ~~any application or use by Landlord of all or any part of~~ Credit must satisfy the conditions for the initial Letter of Credit, except to the extent the amount ~~of the Letter of Credit shall~~ thereof may be ~~less than the LC Amount,~~ reduced as provided in Section 3. If (1) Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of timely renew the Letter of Credit or ~~amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring~~ fails to deliver a substitute Letter of Credit ~~or such other terms~~ to a transferee of Landlord as ~~may be acceptable~~ provided above and (2) Landlord elects to ~~Landlord in its reasonable discretion. However, if~~ draw on the entire Letter of Credit ~~is not timely renewed or~~ and hold any unapplied proceeds thereof, then Tenant may deliver to Landlord a substitute ~~or amendment to letter of credit is not timely received, or if Tenant fails to maintain the~~ Letter of Credit in the amount ~~and~~ of the remaining unapplied amount held by Landlord, in ~~accordance with the terms set forth in this Article 27~~which case, Landlord shall ~~have~~ deliver to Tenant the ~~right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and~~ remaining unapplied proceeds held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Commercial Lease Agreement (Peerless Group Inc)

Letter of Credit. ~~Within forty-five~~ (45A) ~~days after~~ Licensee shall, not later than six (6) months prior to the ~~mutual execution~~ Hotel Opening Date, obtain an unconditional and ~~delivery of this Lease, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an~~ irrevocable ~~and unconditional negotiable~~ letter of credit ~~(the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running~~ in favor of ~~Landlord~~Licensor, in a form reasonably acceptable to Licensor, issued by a ~~solvent~~ bank ~~reasonably~~ or other financial lending institution having assets in excess of Five Hundred Million Dollars ($500,000,000.00) 73 and approved by ~~Landlord under~~ Licensor, which approval shall not be unreasonably withheld, for the ~~supervision~~ benefit of Licensor (the ~~Superintendent of Banks of~~ "LETTER OF CREDIT"), and in an amount equal to Three Million Dollars ($3,000,000.00), subject to increase as provided herein (the ~~State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”~~"LETTER OF CREDIT AMOUNT")~~. Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease~~. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, must provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a ~~transfer~~ default in any of ~~Landlord’s interest~~ Licensee's obligations to Licensor under this Agreement or the Memorabilia Lease, Licensor shall be entitled, in ~~the Building~~addition to all other remedies of Licensor under this Agreement, ~~Landlord shall transfer~~ to make immediate demand under the Letter of ~~Credit,~~ Credit for payment in ~~whole or in part~~ the amount of all sums then due and owing from Licensee to ~~the transferee and thereupon the Landlord shall~~Licensor, without having to give any ~~further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply~~ additional notice to ~~every transfer or assignment of the whole or any portion of said~~ Licensee. The Letter of Credit ~~to a new landlord. If~~must further provide that in the event the Letter of Credit is drawn upon or reduced during the remainder of the Term and, as a ~~result of any application or use by Landlord of all or any part of the Letter of Credit~~result, the amount of the Letter of Credit ~~shall be~~ is less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit ~~expires earlier than~~ Amount, Licensee shall immediately cause the ~~Lease Expiration Date, Landlord will accept a renewal letter~~ amount of ~~credit or substitute letter~~ the Letter of ~~credit (such renewal or substitute letter of credit~~ Credit to be ~~in effect and delivered~~ restored to ~~Landlord, as applicable, not later than~~ the Letter of Credit Amount. (B) On or before thirty (30) days ~~prior to~~ before the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds date of the Letter of Credit, ~~either prior~~ Licensor must receive a replacement Letter of Credit meeting all of the requirements described above (the "REPLACEMENT LETTER OF CREDIT") from Licensee. If a Replacement Letter of Credit is not received in the time period described above, Licensee shall automatically be in default under this Agreement and Licensor shall be entitled to make immediate demand under the Letter of Credit for the entire Letter of Credit Amount, without having to give any additional notice to Licensee, which amount shall be then be treated as a security deposit to secure the payment, by Licensee, of its obligations under this Agreement and the Memorabilia Lease (the "SECURITY DEPOSIT"). Licensee shall remain obligated to obtain a Replacement Letter of Credit and Licensee shall remain in default under this Agreement until such time as Licensee provides a Replacement Letter of Credit to Licensor. In the event of a default in any of Licensee's obligations to Licensor under this Agreement or ~~following~~ the Memorabilia Lease, Licensor shall be entitled, in addition to all other remedies of Licensor under this Agreement or the Memorabilia Lease, as applicable, to immediately deduct from the Security Deposit the amount of all sums then due and owing from Licensee to Licensor, without having to give any additional notice to Licensee. In the event the Security Deposit is drawn upon or reduced during the remainder of this Agreement and, as a ~~“draw” by Landlord~~ result, the amount of ~~any portion~~ the Security Deposit is less than the Letter of Credit Amount, Licensee shall immediately cause the amount of the Security Deposit to be restored to the Letter of Credit Amount. When Licensor receives a Replacement Letter of Credit from Licensee, Licensor shall then return the remaining amount of the Security Deposit to Licensee. (C) At the expiration of the date which is two (2) years after the Opening Date, if Licensee is not then in default under this Agreement or the Memorabilia Lease and has paid all Fees then owed under this Agreement and all amounts owed under the Memorabilia Lease, Licensor will release the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: License Agreement (Premier Finance Biloxi Corp)

Letter of Credit. ~~Within forty-five~~ In consideration of Landlord entering into this Lease and in consideration of financial investments and concessions made by Landlord pursuant to this Lease, Tenant hereby agrees as follows: (45a) ~~days after~~ Simultaneously with the ~~mutual~~ execution ~~and delivery~~ of this ~~Lease~~Lease by Tenant, Tenant shall deliver to Landlord, as ~~collateral~~ additional security for the ~~full and faithful performance by~~ obligations of Tenant ~~of all of its obligations~~ under ~~this~~ the Lease, ~~an irrevocable and unconditional negotiable~~ a clean, unconditional, irrevocable, transferable letter of credit issued by a bank acceptable to Landlord, in its sole discretion (~~the “Letter of Credit”~~"Issuer"), ~~substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running~~ in favor of Landlord, ~~issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association,~~ in the ~~initial~~ amount of THIRTY FOUR THOUSAND AND NO/100 DOLLARS ($~~[***]~~ 34,000.00) (~~“LC Amount”). Tenant shall provide Landlord with a specimen~~ the "Letter of ~~Credit from the approved issuer prior to the execution of this Lease~~Credit"). The Letter of Credit shall ~~be:~~ be in the form attached hereto as Exhibit "G" and by this reference made a part hereof. Tenant shall maintain the Letter of Credit in favor of Landlord throughout the Term of the Lease, and for a period of ninety (a90) ~~at sight and irrevocable;~~days after the expiration of the Term of the Lease. (b) ~~maintained in effect for~~ The term of the ~~entire period from~~ original Letter of Credit required under this Paragraph 45 shall commence as of or prior to the date of ~~execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”)~~delivery thereof to Landlord and shall expire no earlier than August 1, ~~subject to the last paragraph of this Article 27, provide that the~~ 2001. The expiration date of the Letter of Credit shall be ~~no earlier than~~ clearly stated on its face by month, day and year. The Letter of Credit shall be payable in immediately available funds in U.S. Dollars upon presentation by Landlord to Issuer of the original of the Letter of Credit ~~Termination Date~~ and by sight draft drawn on the Issuer, or any of Issuer's correspondent banks, wherever located. (c) The Letter of Credit shall be irrevocable for the term thereof and shall provide that it will be automatically renewed for ~~automatic renewal thereof at least~~ successive periods of one (1) year each without any other action by Landlord or the Issuer through the period ending not less than ninety (90) days after the Lease Expiration Date. The Issuer shall have the right not to renew such Letter of Credit by giving written notice to Landlord not less than ninety (90) days prior to the expiration thereof. The privilege of the Issuer not to renew such Letter of Credit shall not relieve Tenant of the obligation to maintain the Letter of Credit with Landlord through the date which is ninety (90) days after the Lease Expiration Date~~, unless~~ . If the ~~issuing bank provides at least thirty (30) days prior written notice to~~ Issuer notifies Landlord ~~of such non-renewal by certified mail, return receipt requested at~~ that the ~~address set forth on the form of~~ Letter of Credit ~~attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event~~will not be automatically renewed at the end of the then current term thereof, Tenant ~~shall deliver a new Letter of Credit to Landlord~~ shall, at least ~~thirty~~ sixty (3060) days prior to the expiration of the Letter of Credit, deliver to Landlord a new Letter of Credit ~~without any action whatsoever on the part of Landlord; (c) subject~~ or an endorsement to the ~~Uniform Customs~~ existing Letter of Credit, and ~~Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable~~ any other evidence required by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of evidencing that the Letter of Credit has been renewed or replaced for a period of at least one (~~and~~ 1) year (a "Replacement Letter of Credit"). Notwithstanding the ~~bank issuing the same) shall be acceptable to Landlord~~preceding sentence, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the any Replacement Letter of Credit ~~upon~~ is not required to have an effective date sooner than the ~~presentation to~~ Expiry Date of the ~~issuing bank of Landlord’s (or Landlord’s~~ then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the existing Letter of Credit, ~~in whole or in part~~ it being the intent hereof that Tenant not be required to ~~the transferee and thereupon the Landlord shall, without~~ have two outstanding Letters of Credit at any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said one time. Each Replacement Letter of Credit to shall also be deemed a ~~new landlord. If, as a result of any application or use by Landlord of all or any part of the~~ "Letter of Credit" for purposes of this Paragraph 45. Except for the term thereof, ~~the amount of the~~ each Replacement Letter of Credit shall be ~~less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit,~~ identical in ~~an amount equal~~ form and content to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the original Letter of Credit. (d) If: (i) an Event of Default has occurred and remains uncured with respect to Tenant; or (ii) Tenant has filed a petition in Bankruptcy, or an involuntary petition in Bankruptcy has been filed against Tenant [and such involuntary petition has not been dismissed within sixty (60) days after filing] and Tenant is not making or has not made any ~~part thereof and that neither~~ one or more payments of Monthly Rental, Additional Rent or any other monetary obligation of Tenant to Landlord ~~nor its successors or assigns will be bound by~~ under the Lease; Landlord may draw upon any ~~such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the~~ Letter of Credit ~~expires earlier than the Lease Expiration Date~~on one or more occasions. Thereafter, Landlord ~~will accept~~ shall be entitled to use, apply and retain the proceeds of such draw or draws on a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit ~~or amendment), which shall be irrevocable and automatically renewable as above provided through~~ for the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result payment of any ~~default by~~ one or more of the following: (A) any Monthly Rental, Additional Rent or other sums of money that Tenant ~~under this Lease pending Tenant’s delivery~~ may not have paid when due; and (B) reimbursement to Landlord of ~~the~~ any sum which Landlord may expend or be required ~~replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery~~ to expend by reason of such ~~replacement letter~~ Event of ~~credit~~Default, including, without limitation, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; damage or ~~(g) intended to serve as a “security deposit” within the meaning of such Section 1950.~~

Appears in 1 contract

Samples: Lease Agreement (Sideware Systems Inc)

Letter of Credit. ~~Within forty-five (45) days after~~ On or before the ~~mutual execution and delivery of this Lease~~Expansion Space Commencement Date, Tenant shall deliver to ~~Landlord~~Landlord a clean, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an~~ irrevocable ~~and unconditional negotiable~~ letter of credit (the “Expansion Space Letter of Credit”~~), substantially~~ ) established in Landlord’s (and its successors’ and assigns’) favor in the ~~form attached as Exhibit G hereto and made a part hereof, and containing~~ amount of [**] (the ~~terms required herein, payable in the State~~ “Expansion Space Letter of ~~California, running in favor of Landlord~~Credit Amount”), issued by a ~~solvent bank~~ federally insured banking or lending institution reasonably ~~approved by~~ acceptable to Landlord ~~under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association,~~ and in the ~~initial amount~~ form and substance of ~~$[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior~~ Exhibit H to the ~~execution of this~~ Lease. The Expansion Space Letter of Credit shall ~~be: (a)~~ specifically provide for partial draws and shall by its terms be transferable by the beneficiary thereunder. If Tenant fails to make any payment of rent or other charges due to Landlord under the terms of the Lease, as amended hereby, or otherwise defaults thereunder, beyond any applicable notice and cure period, Landlord, at ~~sight and irrevocable; (b) maintained in effect~~ Landlord’s option, may make a demand for payment under the ~~entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“~~Expansion Space Letter of Credit ~~Expiration Date”~~in an amount equal to the amounts then due and owing to Landlord under the Lease, as amended hereby. In the event that Landlord draws upon the Expansion Space Letter of Credit, Tenant shall present to Landlord a replacement Expansion Space Letter of Credit in the full Expansion Space Letter of Credit Amount satisfying all of the terms and conditions of this paragraph within twenty (20) days after receipt of notice from Landlord of such draw. Tenant’s failure to do so within such 20-day period will constitute a default under the Lease, as amended hereby, (Tenant hereby waiving any additional notice and grace or cure period), ~~subject~~ and upon such default Landlord shall be entitled to immediately exercise all rights and remedies available to it hereunder, at law or in equity. In the ~~last paragraph~~ event that the Expansion Space Letter of ~~this Article 27, provide that~~ Credit has an expiration date earlier than the expiration date of ~~the~~ this Amendment and Tenant has not presented to Landlord a replacement Expansion Space Letter of Credit ~~shall be no earlier than~~ which complies with the ~~Letter~~ terms and conditions of ~~Credit Termination Date~~ the Lease on or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least before thirty (30) days prior to the expiration date of ~~the~~ any such Expansion Space Letter of Credit ~~without any action whatsoever on the part of~~ then held by Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with , then Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be ~~acceptable to~~ deemed in default hereunder and Landlord, in ~~Landlord’s reasonable discretion,~~ addition to all other rights and ~~shall provide, among other things, in effect that: (i) Landlord, or its then managing agent~~remedies provided for hereunder, shall have the right to draw ~~down an amount up to~~ upon the ~~face amount of the~~ Expansion Space Letter of Credit ~~upon the presentation~~ then held by Landlord and any such amount paid to ~~the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that~~ Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment issuer of the ~~whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the~~ Expansion Space Letter of Credit shall be ~~less than~~ held by Landlord as security for the ~~LC Amount~~performance of Tenant’s obligations hereunder. Any interest earned on such amounts shall be the property of Landlord. Landlord’s election to draw under the Expansion Space Letter of Credit and to hold the proceeds of the drawing under the Expansion Space Letter of Credit shall not be deemed a cure of any default by Tenant under the Lease, as amended hereby, and shall not relieve Tenant ~~shall, within ten (10) business days thereafter, provide~~ from its obligation to present to Landlord ~~with an additional letter(s) of credit, in an amount equal to the deficiency (or~~ a replacement ~~letter~~ Expansion Space Letter of ~~credit~~ Credit which complies with the terms and conditions of this Amendment. Tenant acknowledges that any proceeds of a draw made under the Expansion Space Letter of Credit and thereafter held by Landlord may be used by Landlord to cure or satisfy any obligation of Tenant hereunder as if such proceeds were instead proceeds of a draw made under a Expansion Space Letter of Credit that remained outstanding and in full force and effect at the ~~total amount of the LC Amount) and~~ time such amounts are applied by Landlord to cure or satisfy any such ~~additional (or replacement) letter~~ obligation of ~~credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by~~ Tenant. Tenant ~~further covenants and warrants that it will neither assign nor encumber~~ hereby affirmatively disclaims any interest Tenant has, may have, claims to have, or may claim to have in any proceeds drawn by Landlord under the Expansion Space Letter of ~~Credit, or any part thereof~~ Credit and ~~that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance~~held in accordance with the terms hereof. Without limiting the generality of the foregoing, if Tenant expressly acknowledges and agrees that at the ~~Letter~~ end of ~~Credit expires earlier than~~ the ~~Lease Expiration Date, Landlord will accept a renewal letter~~ term of ~~credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord~~Lease, as ~~applicable, not later than thirty~~ amended hereby (~~30) days prior to the~~ whether by expiration ~~of the Letter of Credit~~ or ~~amendment~~earlier termination hereof), ~~which shall be irrevocable~~ and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if ~~the Letter of Credit~~ Tenant is not ~~timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit~~ then in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the ~~Lease~~ Lease, as amended hereby, beyond ~~all~~ any applicable notice and cure periods, Landlord ~~may, but without obligation~~ shall return to ~~do so, draw upon~~ the issuer of the Expansion Space Letter of Credit ~~and/or utilize the Cash Collateral,~~ or its successor (or as such issuer may direct in ~~part or in whole, to the extent necessary to cure~~ writing) any ~~default of Tenant and/or to compensate Landlord for any~~ remaining and ~~all damages~~ unapplied proceeds of any ~~kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by~~ prior draws made under the ~~express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the~~ Expansion Space Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant ~~acknowledge and agree that~~ shall have no rights, residual or otherwise, in ~~no event~~ or ~~circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed~~ to ~~be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of~~ such ~~Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~proceeds.

Appears in 1 contract

Samples: Airport Corporate Center Office Lease (NCL CORP Ltd.)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after~~ Delivery of Letter of Credit. Concurrently with the ~~mutual~~ execution and delivery of this Lease, Tenant shall deliver to Landlord, as ~~collateral~~ protection for the full and faithful performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer (or which Landlord reasonably estimates that it may suffer) as a result of any breach or default by Tenant under this Lease, an irrevocable and unconditional negotiable standby letter of credit (the “Letter of Credit”~~), substantially in the form attached as Exhibit G hereto and made a part hereof, and~~ ) containing the terms required herein~~, payable in the State of California~~, running in favor of Landlord, issued by by, a ~~solvent~~ solvent, nationally recognized bank ~~reasonably approved by Landlord~~ with a long term rating from Standard and Poor’s Professional Rating Service of A or a comparable rating from Xxxxx’x Professional Rating Service or higher, under the supervision of the Superintendent of Banks of the State of California, or a ~~National Banking Association~~national banking association (the “Bank”), and payable upon presentation to an operating retail branch located in San Francisco, California of such Approved Issuer, in an amount equal to Two Million Two Hundred Thousand and No/100 Dollars ($2,200,000.00) (the ~~initial amount~~ “Letter of ~~$[***] (“LC~~ Credit Amount”). ~~Tenant shall provide~~ Landlord ~~with a specimen Letter~~ hereby approves Bank of ~~Credit from~~ America as the ~~approved issuer prior to the execution of this Lease~~Bank. The Letter of Credit shall ~~be:~~ (a) be “callable” at ~~sight~~ sight, irrevocable and ~~irrevocable;~~ unconditional, (b) be maintained in ~~effect~~ effect, whether through renewal (pursuant to a so-called “evergreen provision”) or extension, for the ~~entire~~ period from the ~~date of execution of this~~ Lease ~~through~~ Commencement Date and continuing until the date ~~which is sixty~~ (~~60) days following~~ the ~~Termination Date (~~“~~Letter of Credit~~ LC Expiration Date”~~), subject to the last paragraph of this Article 27, provide~~ ) that is one hundred twenty (120) days after the expiration ~~date~~ of the ~~Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date~~Lease Term, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, and Tenant shall deliver to Landlord a new Letter of ~~Credit to Landlord~~ Credit, certificate of renewal or extension amendment at least thirty (30) days prior to the expiration of the Letter of Credit then held by Landlord, without any action whatsoever on the part of Landlord; , (c) be fully transferrable by Landlord, its successors and assigns of this Lease, (d) permit partial draws and multiple presentations and drawings, and (e) be otherwise subject to the Uniform Customs and Practices for Documentary Credits (~~1993~~2007-Rev) ), International Chamber of Commerce Publication #600~~; and (d) fully assignable by Landlord in connection with any number~~ , or the International Standby Practices-ISP 98, International Chamber of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATIONCommerce Publication #590. In addition to the foregoing, the form and terms of the Letter of Credit (and the ~~bank~~ Bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion; provided, that, Landlord hereby approves of the form of Letter of Credit attached hereto as Exhibit K. If Landlord notifies Tenant in writing that the Bank which issued the Letter of Credit has become financially unacceptable because the above requirements are not met or the Bank has filed bankruptcy or reorganization proceedings or is placed into a receivership or conservatorship, or the financial condition of the Bank has changed in any other materially adverse way, then Tenant shall have thirty (30) days to provide Landlord with a substitute Letter of Credit complying with all of the requirements of this Section 38. If Tenant does not so provide Landlord with a substitute Letter of Credit within such thirty (30) day period, then Landlord, or its then managing agent, shall have the right to draw upon the then current Letter of Credit. In addition to Landlord’s rights to draw upon the Letter of Credit in Section 38(d) below and ~~shall provide~~as otherwise described in this Section 38, ~~among other things, in effect that: (i)~~ Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit ~~upon~~ if any of the ~~presentation~~ following shall have occurred or be applicable: (A) such amount is past-due beyond applicable notice and cure periods under the terms and conditions of this Lease; (B) Tenant has filed a voluntary petition under the U.S. Bankruptcy Code or any state bankruptcy code (collectively, “Bankruptcy Code”), (C) an involuntary petition has been filed against Tenant under the Bankruptcy Code, (D) the Bank has notified Landlord that the Letter of Credit will not be renewed or extended through the LC Expiration Date, or (E) Tenant has failed to deliver a new Letter of Credit or amendment to the ~~issuing bank~~ existing Letter of ~~Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing~~ Credit increasing the stated amount as required under the terms of this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the . The Letter of Credit will be honored by the ~~issuing bank without inquiry as to the accuracy thereof and~~ Bank regardless of whether ~~the~~ Tenant disputes ~~the content of such statement; and (iii) in the event of a transfer of~~ Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of ~~Credit and/or utilize~~ Credit. Tenant shall be responsible for paying the ~~Cash Collateral,~~ Bank’s fees in ~~part or in whole, to~~ connection with the ~~extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages~~ issuance of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, ~~either prior to~~ certificate of renewal or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950extension amendment.

Appears in 1 contract

Samples: Lease Agreement (Atlassian Corp PLC)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after~~ Subject to Section 5.7 hereof and except as may be permitted under the ~~mutual execution and delivery~~ Indenture, the Borrower agrees that throughout the term of this ~~Lease~~Agreement it, ~~Tenant shall deliver~~ or any successor or assignee as permitted by Section 5.2 hereof, will maintain or cause to ~~Landlord~~be maintained a Letter of Credit for each Series of Bonds or an Alternate Letter of Credit for each Series of Bonds. At any time the Borrower may, ~~as collateral~~ at its option, provide for the ~~full~~ delivery to the Trustee of an Alternate Letter of Credit and ~~faithful performance~~ the Borrower shall, in any event, cause to be delivered an Alternate Letter of Credit at least 60 days before the expiration date of any existing Letter of Credit, unless otherwise permitted by ~~Tenant~~ the Indenture, or any existing Alternate Credit Facility. An Alternate Letter of ~~all of its obligations under this Lease,~~ Credit shall be an irrevocable ~~and unconditional negotiable~~ letter of credit or other irrevocable credit facility (~~the “Letter~~ including, if applicable, a confirming letter of ~~Credit”~~credit)~~, substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord~~, issued by a ~~solvent~~ commercial bank ~~reasonably approved by Landlord under~~ or other financial institution, the ~~supervision~~ terms of which shall in all material respects be the ~~Superintendent of Banks of~~ same as the ~~State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen~~ applicable Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”)Credit; provided, ~~subject to the last paragraph of this Article 27, provide~~ that the expiration date of ~~the~~ such -------- Alternate Letter of Credit shall be no a date not earlier than ~~the Letter~~ one year from its date of ~~Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date~~issuance, ~~unless the issuing bank provides at least thirty (30) days prior written notice~~ subject to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration earlier termination upon payment of the ~~Letter~~ related Series of ~~Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices~~ Bonds in full or provision for ~~Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord~~ such payment in ~~connection~~ accordance with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms Article X of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlordIndenture. ~~If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be~~ Not less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the ~~expiration~~ delivery of an Alternate Letter of Credit, the Borrower shall (i) deliver to the Trustee a written commitment for the delivery of such Alternate Letter of Credit, (ii) inform the Trustee of the date on which the Alternate Letter of Credit ~~or amendment)~~will become effective, which date shall not be ~~irrevocable and automatically renewable as above provided through~~ less than five (5) calendar days prior to the ~~Lease Expiration Date upon~~ stated expiration date of the ~~same terms as the expiring~~ existing Letter of Credit ~~or such other terms as may be acceptable~~ and (iii) inform the Trustee of the rating expected to ~~Landlord in its reasonable discretion. However, if~~ apply to the related Series of Bonds after the Alternate Letter of Credit is ~~not timely renewed~~ delivered. On or ~~a substitute or amendment~~ prior to ~~letter~~ the date of ~~credit is not timely received, or if Tenant fails to maintain~~ the ~~Letter~~ delivery of ~~Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the~~ an Alternate Letter of Credit to the ~~issuing bank~~ Trustee, the Borrower shall cause to be furnished to the Trustee (i) an opinion of Bond Counsel stating to the effect that the delivery of such Alternate Letter of Credit to the Trustee is authorized under the Indenture and complies with the terms hereof and will not adversely affect the Tax-exempt status of the Bonds, (ii) an opinion stating to the effect that such Alternate Letter of Credit is enforceable in accordance with ~~the~~ its terms ~~of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash~~ (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, except to the extent ~~necessary~~ that the enforceability thereof may be limited by bankruptcy, reorganization or similar laws limiting the enforceability of creditors' rights generally and except that no opinion need be expressed as to ~~cure any default of Tenant and/or to compensate Landlord for any and all damages~~ the availability of any ~~kind~~ discretionary equitable remedies), and (iii) written evidence from Xxxxx'x, if the Bonds are rated by Xxxxx'x, and S&P, if the Bonds are rated by S&P, and/or Fitch, if the Bonds are rated by Fitch that the related Series of Bonds shall have a long-term rating of Fitch "A+" (or ~~nature sustained~~ equivalent) or ~~which may~~ higher or, if the related Series of Bonds only has a short-term rating, such short-term rating shall be ~~sustained by Landlord resulting from Tenant’s default, as may be permitted by~~ in the ~~express terms and conditions~~ highest short-term rating category (without regard to "+"'s or "-"'s). (b) The Borrower shall provide a written statement to the Trustee (with copies to the Authority) on or before June 1 of ~~this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord~~ each year indicating the status of the ~~proceeds~~ extension of the ~~Letter~~ term of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the each Letter of Credit. ~~No condition or term of this Lease shall be deemed to render the~~ If a Letter of Credit ~~conditional to justify~~ provides for automatic annual extensions, the ~~issuer~~ Borrower shall notify the Trustee either (i) that the term of ~~the Letter of Credit in failing to honor a drawing upon~~ such Letter of Credit ~~in a timely manner. Landlord and Tenant acknowledge and agree~~ has been automatically extended pursuant to its terms, or (ii) that ~~in no event or circumstance shall the~~ such Letter of Credit ~~or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed~~ Bank has given written notice of a decision not to ~~be or treated as a “security deposit” within~~ extend the ~~meaning of California Civil Code Section 1950.7; (f) subject to the terms~~ term of such ~~Section 1950.7; or (g) intended to serve as~~ Letter of Credit. If a ~~“security deposit” within~~ Letter of Credit does not provide for automatic extensions, the ~~meaning~~ Borrower shall notify the Trustee whether or not the Bank has given written approval for an extension of the term of such ~~Section 1950~~Letter of Credit.

Appears in 1 contract

Samples: Loan Agreement (Kaiser Ventures Inc)

Letter of Credit. ~~Within forty-five (45) days after~~ As an alternative to providing Landlord with the ~~mutual~~ Security Deposit required under Paragraph 6.a. above, Tenant may deliver to Landlord, concurrently with its execution ~~and delivery~~ of this Lease, ~~Tenant shall deliver to Landlord,~~ as ~~collateral~~ security for the ~~full~~ performance of Tenant’s covenants and ~~faithful performance by Tenant of all of its~~ obligations under this Lease, an original irrevocable ~~and unconditional negotiable~~ standby letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, ) in the initial amount specified in Paragraph 2.d. above, naming Landlord as beneficiary, which Landlord may draw upon to cure any default under this Lease (or any breach under this Lease where there exist circumstances under which Landlord is enjoined or otherwise prevented by operation of ~~$[***] (“LC Amount”~~law from giving to Tenant a written notice which would be necessary for such failure of performance to constitute a default under this Lease), or to compensate Landlord for any damage Landlord incurs as a result of Tenant’s failure to perform any of its obligations hereunder. ~~Tenant shall provide Landlord with a specimen~~ Any such draw on the Letter of Credit ~~from the approved issuer prior~~ shall not constitute a waiver of any other rights of Landlord with respect to ~~the execution of this Lease~~such default or failure to perform. The Letter of Credit shall ~~be: (a) at sight~~ be issued by a major commercial bank reasonably acceptable to Landlord, with a San Francisco, California, service and ~~irrevocable; (b) maintained in effect~~ claim point for the ~~entire~~ Letter of Credit, have an expiration date not earlier than the sixtieth (60th) day after the Expiration Date (or, in the alternative, have a term of not less than one (1) year and be automatically renewable for an additional one (1) year period ~~from~~ unless notice of non-renewal is given by the ~~date of execution of this Lease through the date which is~~ issuer to Landlord not later than sixty (60) days ~~following~~ prior to the ~~Termination Date (“~~expiration thereof) and shall provide that Landlord may make partial and multiple draws thereunder, up to the face amount thereof. If, at any period while the Letter of Credit ~~Expiration Date”~~is required to be in effect hereunder, the financial condition of the issuing bank materially deteriorates from the financial condition as of the date of Landlord’s initial approval of the bank (as evidenced by a material drop in Standard & Poor’s financial services rating for such bank), ~~subject~~ then Landlord may, by written notice to Tenant, require that Tenant replace the ~~last paragraph~~ Letter of Credit with a Letter of Credit issued by a major commercial bank then reasonably acceptable to Landlord. In addition, the Letter of Credit shall provide that, in the event of Landlord’s assignment or other transfer of its interest in this ~~Article 27~~Lease, ~~provide that the expiration date of~~ the Letter of Credit shall be ~~no earlier than~~ freely transferable by Landlord, without charge and without recourse, to the assignee or transferee of such interest and the bank shall confirm the same to Landlord and such assignee or transferee. The Letter of Credit shall provide for payment to Landlord upon the issuer’s receipt of a sight draft from Landlord together with a statement by Landlord that the requested sum is due and payable from Tenant to Landlord in accordance with the provisions of this Lease, shall be in the form attached hereto as Exhibit C, and otherwise be in form and content satisfactory to Landlord. If the Letter of Credit ~~Termination Date or provide for automatic renewal thereof at least through~~ has an expiration date earlier than sixty (60) days after the ~~Letter of Credit~~ Expiration Date, ~~unless~~ then throughout the ~~issuing bank provides at least thirty~~ term hereof (30including any renewal or extension of the term) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall ~~deliver a new~~ provide evidence of renewal of the Letter of Credit to Landlord at least ~~thirty~~ sixty (3060) days prior to the ~~expiration~~ date the Letter of Credit expires. If Landlord draws on the Letter of Credit pursuant to the terms hereof, Tenant shall immediately replenish the Letter of Credit or provide Landlord with an additional letter of credit conforming to the requirement of this paragraph so that the amount available to Landlord from the Letter of Credit(s) provided hereunder is the amount required hereunder. Tenant’s failure to deliver any replacement, additional or extension of the Letter of Credit, or evidence of renewal of the Letter of Credit, within the time specified under this Lease shall entitle Landlord to draw upon the entire balance of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by then in effect. If Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of liquidates the Letter of Credit ~~(and~~ as provided in the ~~bank issuing~~ preceding sentence, Landlord shall hold the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of funds received from the Letter of Credit ~~upon the presentation to the issuing bank of Landlord~~as security for Tenant’s ~~(or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing~~ performance under this Lease, ~~it being understood that if~~ this Paragraph 6 shall be deemed a security agreement for such purposes and for purposes of Division 9 of the California Uniform Commercial Code, Landlord ~~or its managing agent~~ shall be deemed to hold a ~~corporation~~perfected, ~~partnership~~ first priority security interest in such funds, and Tenant does hereby authorize Landlord to file such financing statements or other ~~entity~~instruments as Landlord shall deem advisable to further evidence and/or perfect such security interest. Landlord shall not be required to segregate such security deposit from its other funds and no interest shall accrue or be payable to Tenant with respect thereto. No holder of a mortgage, ~~then such statement~~ deed of trust or other security instrument affecting the Real Property, nor any purchaser at any judicial or private foreclosure sale of the Real Property or any portion thereof, shall be ~~signed by an officer~~ responsible to Tenant for such security deposit unless and only to the extent such holder or purchaser shall have actually received the same. If Tenant is not in default at the expiration or termination of this Lease, within sixty (~~if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii~~60) days thereafter Landlord shall return to Tenant the Letter of Credit ~~will~~ or the balance of the security deposit then held by Landlord, as applicable; provided, however, that in no event shall any such return be ~~honored~~ construed as an admission by Landlord that Tenant has performed all of its covenants and obligations hereunder. Tenant hereby unconditionally and irrevocably waives the ~~issuing bank~~ benefits and protections of California Civil Code Section 1950.7, and, without ~~inquiry as to~~ limitation of the ~~accuracy thereof and regardless of whether the Tenant disputes the content~~ scope of such ~~statement; and (iii) in the event of a transfer of Landlord’s interest in the Building~~waiver, acknowledges that Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or may use ~~by Landlord of~~ all or any part of the Letter of Credit or the proceeds thereof to compensate Landlord for damages resulting from termination of this Lease and the tenancy created hereunder (including, without limitation, damages recoverable under California Civil Code Section 1951.2). Notwithstanding anything in this Paragraph 6.a. to the contrary, on April 30, 2015, on April 30, 2016, on April 30, 2017, and on April 30, 2018, Tenant may replace the then current Letter of Credit with a Letter of Credit in an amount equal to the then existing Letter of Credit amount minus Twenty-Four Thousand Seven Hundred Fifty-Four and 12/100 Dollars ($24,754.12), but in all other respects in conformance with the Letter of Credit described in this Paragraph 6.b. (or, rather than replace the then current Letter of Credit, Tenant may submit to Landlord an amendment thereto, in form reasonably acceptable to Landlord, which reduces the amount of that Letter of Credit by the applicable amount); provided, however, that Tenant may not reduce the amount of the Letter of Credit ~~shall~~ pursuant to the foregoing on a particular reduction date if (i) during the twelve (12) month period immediately preceding such reduction date, there occurred an Event of Default or a breach by Tenant that subsequently matured into an Event of Default, or (ii) the replacement or amended Letter of Credit held by Landlord would be in an amount less than Twenty-One Thousand One Hundred Thirty-Three and 50/100 Dollars ($21,133.50) after giving effect to such reduction. If Tenant failed to qualify for a reduction of the ~~LC Amount~~face amount of the letter of credit on a particular reduction date, Tenant ~~shall, within ten (10) business days thereafter, provide Landlord~~ may replace the then current Letter of Credit with ~~an additional letter(s)~~ a Letter of ~~credit,~~ Credit in an amount equal to the ~~deficiency~~ then existing Letter of Credit amount minus Twenty-Four Thousand Seven Hundred Fifty-Four and 12/100 Dollars (~~or a replacement~~ $24,754.12) on the next scheduled reduction date, so long as the requirements above are met, but the face amount of the letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as then on hand may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be ~~entitled to~~ reduced or amended by more than Twenty-Four Thousand Seven Hundred Fifty-Four and 12/100 Dollars ($24,754.12) on any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950particular reduction date.

Appears in 1 contract

Samples: Office Lease (Homeunion Holdings, Inc.)

Letter of Credit. ~~Within forty-five (45) days after~~ Concurrently with the ~~mutual~~ execution ~~and delivery~~ of this Lease, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”~~), substantially in the form attached as Exhibit G hereto and made a part hereof, and~~ ) containing the terms required herein~~, payable in the State of California~~, running in favor of Landlord, issued by ~~a solvent~~ Silicon Valley Bank or another bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in ~~the initial~~ an amount ~~of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior~~ equal to the ~~execution of this Lease~~LC Amount and otherwise satisfactory to Landlord. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date (“LC Expiration Date”) which is ~~sixty~~ thirty (6030) days following the ~~Termination Date~~ expiration of the Term of this Lease (~~“Letter of Credit Expiration Date”~~including renewal options), ~~subject to the last paragraph of this Article 27, provide~~ provided that the expiration date ~~of the Letter of Credit~~ thereof shall be no earlier than the ~~Letter of Credit Termination~~ LC Expiration Date or provide for automatic renewal thereof at least through the ~~Letter of Credit~~ LC Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-~~renewal by certified mail~~renewal, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, and Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the ~~Uniform Customs and~~ International Standby Practices ~~for Documentary Credits~~ (~~1993-Rev~~ISP 1998) International Chamber of Commerce Publication #~~600~~590; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws~~. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION~~. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be is a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part (or cause a substitute letter of credit to be delivered, as applicable) to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ~~ten~~ seven (107) business days thereafter, provide Landlord with an additional letter(s) of ~~credit,~~ credit in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this ~~Article 27~~Section 6, and if ~~Xxxxxx~~ Tenant fails to comply with the ~~foregoing terms of this sentence~~foregoing, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the ~~Lease~~ LC Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of ~~Credit or amendment~~Credit), which shall be irrevocable and automatically renewable as above provided through the ~~Lease~~ LC Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute ~~or amendment to~~ letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this ~~Article 27~~Section 6, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this ~~Article 27~~Section 6, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this ~~Article 27~~Section 6. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold the Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond ~~all~~ any applicable ~~notice and cure periods~~grace period, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, ~~to the extent necessary~~ to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default~~, as may be permitted by the express terms and conditions of this Lease~~. ~~Xxxxxx~~ Tenant agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, ~~[***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION.~~ regardless of whether any dispute exists between ~~Xxxxxx~~ Tenant and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (ea) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (fb) subject to the terms of such Section 1950.7; or (gc) intended to serve as a “security deposit” within the meaning of such Section ~~1950~~1950.7. The parties hereto: (i) recite that the Letter of Credit and/or Cash Collateral, as the case may be, is not intended to serve as a security deposit and such Section 1950.7 and any and all other laws, rules and regulations applicable to security deposits in the commercial context (“Security Deposit Laws”) shall have no applicability or relevancy thereto; and (ii) waive any and all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit Laws. Notwithstanding anything to the contrary contained in this Section 6, on each yearly anniversary of the Commencement Date and provided that Tenant has furnished to Landlord Tenant’s financial statements audited by a national independent certified public accounting firm for each of the four (4) most recent consecutive calendar quarters with each statement showing positive income for such quarter and provided no Event of Default exists and Tenant is not then in monetary default or material non-monetary default of any of its obligations under this Lease, Landlord shall, within ten (10) days following the later of satisfaction of the foregoing and Tenant’s written request, notify the Bank that the LC Amount may be reduced by $100,000. No such reduction may occur unless Landlord has so notified the Bank. A Letter of Credit in the LC Amount and otherwise in accordance with the terms of this Section 6 shall be required at all times, with Tenant’s non-compliance with the foregoing constituting an uncurable default under this Lease.

Appears in 1 contract

Samples: Lease Agreement (Riverbed Technology, Inc.)

Letter of Credit. ~~Within forty-five (45) days after~~ In lieu of the ~~mutual execution and delivery~~ cash deposit described in Section 10 of ~~this~~ the Lease, Tenant ~~shall~~ may, upon signing this Lease (or at any time thereafter to replace the cash deposit), deliver or cause to ~~Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease,~~ be delivered to Landlord an irrevocable and unconditional ~~negotiable~~ letter of credit (the “Letter of Credit”~~), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued~~ ) governed by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and ~~Practices~~ Practice for Documentary Credits (~~1993-Rev)~~ 1993 revisions), International Chamber of Commerce Publication ~~#600; and~~ No. 500, as revised from time to time, in the amount of the security deposit, issued to Landlord, as beneficiary, in form and substance satisfactory to Landlord, by a bank (dan “Approved Bank”) ~~fully assignable~~ approved by Landlord qualified to transact banking business in ~~connection~~ California with ~~any number~~ an office in either the City and County of ~~transfers~~ San Francisco or the County of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of Santa Xxxxx at which drafts drawn on the Letter of Credit ~~(and the bank issuing the same) shall~~ may be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlordpresented for payment. ~~If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the~~ The full amount of the Letter of Credit shall be ~~less than~~ available to Landlord upon presentation of Landlord’s sight draft accompanied only by the ~~LC Amount,~~ Letter of Credit and Landlord’s signed statement that Landlord is entitled to draw on the Letter of Credit pursuant to this Lease. Tenant ~~shall, within ten (10) business days thereafter, provide~~ shall maintain the Letter of Credit throughout the duration of the Term of this Lease and the right to draw thereunder shall be transferred or assigned by Landlord ~~with an additional letter(s) of credit, in an amount equal~~ to any successor Landlord under this Lease. Tenant shall pay any fees related to the ~~deficiency (~~issuance, amendment or ~~a replacement letter~~ transfer of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or including without limitation, any ~~part thereof and~~ transfer fees. The Letter of Credit shall also provide that ~~neither~~ it shall be deemed automatically renewed, without amendment, for consecutive periods of one (1) year each during the term of this Lease (plus a period of thirty (30) days after the Expiration Date), unless the Approved Bank sends written notice (“Issuer Notice”) to Landlord ~~nor its successors or assigns will be bound~~ by any ~~such assignment~~method specified in Section 33 of this Lease, ~~encumbrance, attempted assignment or attempted encumbrance. Without limiting~~ not less than sixty (60) days next preceding the ~~generality~~ then expiration date of ~~the foregoing, if~~ the Letter of Credit ~~expires earlier than the Lease Expiration Date~~that it elects not to have such Letter of Credit renewed. If Landlord receives an Issuer Notice, ~~Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect~~ and ~~delivered to Landlord, as applicable,~~ not later than thirty (30) days prior to the ~~expiration~~ expiry date of the Letter of Credit ~~or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring~~ Tenant fails to furnish Landlord with a replacement Letter of Credit ~~or such other terms as may be acceptable~~ pursuant to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms ~~set forth in~~ and conditions of this ~~Article 27~~Section 11, then Landlord shall have the right to ~~present~~ draw the full amount of the Letter of ~~Credit to the issuing bank in accordance with the terms of this Article 27~~Credit, by sight draft, and ~~the entire sum evidenced thereby~~ shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a ~~“security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject~~ cash Security Deposit pursuant to the terms and conditions of ~~such~~ Section ~~1950.7; or (g) intended to serve as a “security deposit” within the meaning~~ 10 of ~~such Section 1950~~this Lease.

Appears in 1 contract

Samples: Office Lease Agreement (Invuity, Inc.)

Letter of Credit. Within ~~forty-five~~ three (453) ~~days after~~ Business Days (as hereafter defined) of the ~~mutual~~ date of the execution and delivery of this Lease by Landlord and Tenant, to secure Tenant's obligations under this Lease, Tenant shall deliver to ~~Landlord~~Landlord either (i) cash or other form of payment in immediately available funds in the amount required pursuant to sub-Paragraph (a) below ("CASH DEPOSIT"), ~~as collateral for~~ or (ii) a letter of credit in accordance with the ~~full~~ following terms, provisions and ~~faithful performance by~~ conditions: (a) If Tenant ~~of all of its obligations under this Lease~~elects not to deliver a Cash Deposit, Tenant shall deliver to Landlord an ~~irrevocable and unconditional negotiable~~ unconditional, irrevocable, standby letter of credit (~~the “Letter of Credit”), substantially~~ "LETTER OF CREDIT") in the ~~form~~ amount of $850,000.00 which conforms in substance to EXHIBIT 1.6(a) attached ~~as Exhibit G~~ hereto and made a part ~~hereof,~~ hereof (or is otherwise reasonably acceptable to Issuer and ~~containing~~ Landlord) and which satisfies the ~~terms required herein, payable in the State of California, running in favor of Landlord,~~ following requirements: (i) is issued by a ~~solvent~~ United States federal or state chartered bank ~~reasonably approved by Landlord under the supervision~~ that (A) is either a member of the ~~Superintendent of Banks of the State of California~~New York Clearing House Association or is a commercial bank or trust company reasonably acceptable to Landlord, ~~or a National Banking Association, in the initial amount of $[***]~~ and (~~“LC Amount”~~B) is otherwise reasonably acceptable to Landlord ("ISSUER")~~. Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable~~; (bii) ~~maintained in effect for the entire period from~~ names Landlord as beneficiary thereunder; (iii) has a term ending not less than one year after the date of ~~execution of this Lease through the date which is~~ issuance; (iv) automatically renews for one (1)-year periods unless Issuer notifies beneficiary, in writing, at least sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of date thereof, that Issuer elects not to renew the Letter of ~~Credit without any action whatsoever on the part of Landlord~~Credit; (cv) ~~subject~~ provides for payment to Landlord upon the occurrence of a Draw Event (as hereafter defined) of immediately available funds (denominated in United States dollars); (vi) provides that draws may be presented, and are payable, at Issuer's letterhead office or, if permitted by Issuer, any other full service office of Issuer; (vii) is payable in sight drafts which only require the beneficiary to state that the draw is payable to the ~~Uniform Customs~~ order of beneficiary; (viii) permits partial and ~~Practices for Documentary Credits~~ multiple draws; (~~1993-Rev~~ix) ~~International Chamber~~ permits multiple transfers by beneficiary (provided, however, Tenant shall be required to pay any required transfer fees only in the case of ~~Commerce Publication #600~~a transfer in connection with the sale, conveyance or transfer of title of or to the Demised Premises and provided Tenant's obligation to so pay the transfer fees does not occur more frequently than once per calendar year); (x) waives any rights that Issuer may have, at law or otherwise, to subrogate to any claims beneficiary may have against applicant; and (dxi) ~~fully assignable~~ is governed by ~~Landlord in connection with any number~~ the International Standby Practices 1998, published by the International Chamber of ~~transfers of Landlord’s interest in this Lease (with Tenant bearing any fees~~Commerce. Subject to Section 1.6(b) hereof, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (as transferred, extended, renewed or replaced) must be maintained during the entire Term, as extended or renewed, and for a period of seventy-five (75) days thereafter. (b) In the ~~bank issuing~~ event at any time during the ~~same) shall be acceptable~~ Term Tenant delivers written notice to Landlord, ~~in Landlord’s~~ together with reasonable ~~discretion~~supporting documentation, ~~and shall provide~~that Tenant's corporate credit rating achieves a so-called "investment grade" for a continuous period of not less than twelve (12) months as determined by Standard & Poors Corporation, ~~among~~ Xxxxx'x Investors Service, Inc. or any other ~~things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount~~ nationally recognized rating agency if both of the ~~Letter of Credit upon the presentation~~ foregoing cease to ~~the issuing bank of Landlord’s~~ exist (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity"RATING AGENCY"), then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit may be reduced to one-twelfth of the annual Base Rent for the Initial Improvements, PLUS if applicable, one-twelfth of the annual Base Rent for the Expansion Space as provided in Section 1.6(k) hereof for the remainder of the Term. Tenant shall ~~be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide~~ deliver to Landlord ~~with an additional letter(s) of credit, in an amount equal to the deficiency (or~~ a replacement ~~letter~~ Letter of ~~credit in~~ Credit for the ~~total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27~~reduced amount, ~~and if Xxxxxx fails to comply with the foregoing terms of this sentence,~~ but otherwise on the same ~~shall constitute an uncurable default~~ terms and conditions provided in Section 1.6(a) hereof. Upon receipt by ~~Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the~~ Landlord of such replacement Letter of Credit, ~~or any part thereof and that neither~~ Landlord ~~nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting~~ shall deliver to Tenant the ~~generality~~ original Letter of ~~the foregoing, if~~ Credit. (c) Landlord may freely transfer the Letter of Credit ~~expires earlier~~ in connection with an assignment of this Lease without (i) Tenant's consent, (ii) restriction on the number of transfers, or (iii) condition, other than presentment to Issuer of the ~~Lease Expiration Date, Landlord will accept~~ original Letter of Credit and a ~~renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be~~ duly executed transfer document conforming in ~~effect and delivered to Landlord, as applicable, not later than thirty (30) days prior~~ substance to the ~~expiration~~ form attached as Exhibit B to the form of Letter of Credit that is attached hereto as EXHIBIT 1.6(a). Tenant is solely responsible for any bank fees or charges imposed by Issuer in connection with the issuance of the Letter of Credit or ~~amendment)~~any transfer, ~~which~~ renewal, extension or replacement thereof; provided, however, Tenant shall be ~~irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable~~ required to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit pay any required transfer fee only in the ~~amount and~~ case of a transfer in ~~accordance~~ connection with the ~~terms set forth in this Article 27~~sale, ~~Landlord shall have the right to present the Letter~~ conveyance or transfer of ~~Credit~~ title of or to the ~~issuing bank in accordance with~~ Demised Premises and provided Tenant's obligation to so pay the ~~terms of this Article 27, and~~ transfer fees does not occur more frequently than once per calendar year. Subject to the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periodsforegoing, Landlord may, ~~but~~ at its option and without ~~obligation~~ notice to ~~do so~~Tenant, ~~draw~~ elect to pay any transfer fees to Issuer when due, and upon ~~the Letter of Credit and/or utilize the Cash Collateral~~payment, ~~in part or in whole,~~ such amount will become immediately due and payable from Tenant to ~~the extent necessary to cure any default of Tenant and/or to compensate~~ Landlord ~~for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default,~~ as ~~may be permitted by the express terms and conditions of~~ Additional Charges (as hereafter defined) under this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Build to Suit Lease Agreement (Rayovac Corp)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after~~ Subject to Section 5.7 hereof and except as may be permitted under the ~~mutual execution and delivery~~ Indenture, the Borrower agrees that throughout the term of this ~~Lease~~Agreement it, ~~Tenant shall deliver~~ or any successor or assignee as permitted by Section 5.2 hereof, will maintain or cause to ~~Landlord~~be maintained the Letter of Credit or an Alternate Letter of Credit. At any time the Borrower may, ~~as collateral~~ at its option, provide for the ~~full~~ delivery to the Trustee of an Alternate Letter of Credit and ~~faithful performance~~ the Borrower shall, in any event, cause to be delivered an Alternate Letter of Credit at least 60 days before the expiration date of any existing Letter of Credit, unless otherwise permitted by ~~Tenant~~ the Indenture, or any existing Alternate Credit Facility. An Alternate Letter of ~~all of its obligations under this Lease,~~ Credit shall be an irrevocable ~~and unconditional negotiable~~ letter of credit or other irrevocable credit facility (~~the “Letter~~ including, if applicable, a confirming letter of ~~Credit”~~credit)~~, substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord~~, issued by a ~~solvent~~ commercial bank ~~reasonably approved by Landlord under~~ or other financial institution, the ~~supervision~~ terms of which shall in all material respects be the ~~Superintendent of Banks of~~ same as the ~~State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen~~ Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”)Credit; provided, ~~subject to the last paragraph of this Article 27, provide~~ that the expiration date of ~~the~~ such Alternate Letter of Credit shall be no a date not earlier than one year from its date of issuance, subject to earlier termination upon payment of all Bonds in full or provision for such payment in accordance with Article X of the Indenture. Not less than 30 days prior to the delivery of an Alternate Letter of Credit, the Borrower shall (i) deliver to the Trustee a commitment for the delivery of such Alternate Letter of Credit, (ii) inform the Trustee of the date on which the Alternate Letter of Credit will become effective, which date shall not be less than 5 calendar days prior to the stated expiration date of the existing Letter of Credit and (iii) inform the Trustee of the rating expected to apply to the 1998A Bonds after the Alternate Letter of Credit is delivered. On or prior to the date of the delivery of an Alternate Letter of Credit to the Trustee, the Borrower shall cause to be furnished to the Trustee (i) an opinion of Bond Counsel stating that the delivery of such Alternate Letter of Credit to the Trustee is authorized under the Indenture and complies with the terms hereof and will not adversely affect the Tax-exempt status of the Bonds, (ii) an opinion that such Alternate Letter of Credit is enforceable in accordance with its terms (except to the extent that the enforceability thereof may be limited by bankruptcy, reorganization or similar laws limiting the enforceability of creditors' rights generally and except that no opinion need be expressed as to the availability of any discretionary equitable remedies), and (iii) written evidence from a Rating Agency to the effect that such rating agency has reviewed the proposed Alternate Letter of Credit and (A) that the substitution of the proposed Alternate Letter of Credit for the Letter of Credit ~~Termination Date~~ will not, by itself, result in a reduction or withdrawal of its rating of the Bonds from the rating which then prevails, unless on the effective date of such Alternate Letter of Credit the Holders of the Bonds are subject to mandatory tender pursuant to Section 4.06 of the Indenture, in which case, subject to clause (B) following, the rating of the Bonds may be reduced, and (B) if the Bonds then have a long-term rating, that the Bonds will be rated Moodx'x "X0" or Fitch "A+" (or equivalent) or higher or, if the Bonds only have a short-term rating, will be in the highest short-term rating category. (b) The Borrower shall provide ~~for automatic renewal thereof at least through~~ a written statement to the Trustee (with copies to the Authority) on or before June 1 of each year indicating the status of the extension of the term of the Letter of Credit. If the Letter of Credit ~~Expiration Date~~provides for automatic annual extensions, ~~unless~~ the ~~issuing bank provides at least thirty~~ Borrower shall notify the Trustee either (30i) ~~days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at~~ that the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration term of the Letter of Credit ~~without any action whatsoever on the part of Landlord;~~ has been automatically extended pursuant to its terms, or (cii) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of that the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) Bank has given written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event notice of a ~~transfer of Landlord’s interest in~~ decision not to extend the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part term of the Letter of Credit~~, the amount of~~ . If the Letter of Credit does not provide for automatic extensions, the Borrower shall ~~be less than~~ notify the ~~LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with~~ Trustee whether or not the Bank has given written approval for an ~~additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount~~ extension of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds term of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Loan Agreement (Waste Connections Inc/De)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution and delivery of this Lease~~An irrevocable, ~~Tenant shall deliver to Landlord~~unconditional, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease~~transferable, ~~an irrevocable and unconditional negotiable~~ clean sight draft letter of credit having an initial term of not less than one (~~the “Letter of Credit”)~~1) year, ~~substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running~~ in favor of ~~Landlord~~Mortgagee and entitling Mortgagee to draw thereon in Tampa, ~~issued~~ Florida, based solely on a statement that Mortgagee has the right to draw thereon executed by an officer or authorized signatory of Mortgagee. Notwithstanding the foregoing, the letter of credit may provide for draws in New York, New York if such draws may be made by a ~~solvent bank reasonably approved by Landlord under the supervision~~ courier or overnight delivery of ~~the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”)~~applicable documents. ~~Tenant shall provide Landlord with a specimen~~ A Letter of Credit ~~from~~ must be issued by an Eligible Institution. If at any time (a) the ~~approved issuer prior to the execution of this Lease. The~~ institution issuing any such Letter of Credit shall ~~be: (a) at sight and irrevocable;~~ cease to be an Eligible Institution or (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of if the Letter of Credit ~~shall be no earlier than~~ is due to expire prior to the termination of the event or events which gave rise to the requirement that Mortgagor deliver the Letter of Credit ~~Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date~~to Mortgagee, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, Mortgagee shall have the right to draw down the same in full or in part and deposit the proceeds thereof into the Cash Management Account to be held and applied in accordance with the provisions of this Mortgage and the Cash Management Agreement, unless Mortgagor shall deliver a replacement Letter of Credit from an ~~amount up~~ Eligible Institution within (i) as to clause (a) above, twenty (20) days after Mortgagee delivers written notice to Mortgagor that the ~~face amount of~~ institution issuing the Letter of Credit ~~upon the presentation~~ has ceased to ~~the issuing bank of Landlord’s (~~be an Eligible Institution or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) ~~the Letter of Credit will be honored by the issuing bank without inquiry~~ as to ~~the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and~~ clause (~~iii~~b) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shallabove, within ~~ten~~ twenty (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (3020) days prior to the expiration date of said Letter of Credit. Any Letter of Credit must be obtained by a Person, on behalf of Borrower, other than the SPE Entity, and neither Mortgagor nor the SPE Entity shall have or be permitted to have any liability or other obligations under any reimbursement agreement with respect to any Letter of Credit or ~~amendment), which shall be irrevocable and automatically renewable as above provided through~~ otherwise in connection with reimbursement to the ~~Lease Expiration Date upon the same terms as the expiring~~ issuer of Letter of Credit or for draws on such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. ~~No condition~~ Licenses. As defined in Section 2.01(z) hereof. License Agreement. Any license or occupancy agreement granted by Mortgagor to an operator of a cart, kiosk or similar merchandising or sponsorship facilities located in the common areas of the Property or a tenant of in-line space for a term of ~~this Lease shall be deemed to render~~ one (1) year or less. Lien. Any mortgage, deed of trust, lien, pledge, hypothecation, assignment, security interest, or any other encumbrance or charge on the ~~Letter of Credit~~ Property, any portion thereof or any interest therein, including, without limitation, any conditional ~~to justify~~ sale or other title retention agreement, any financing lease having substantially the ~~issuer~~ same economic effect as any of the ~~Letter~~ foregoing, the filing of ~~Credit~~ any financing statement, and mechanic’s, materialmen’s and other similar liens and encumbrances. Liens and Encumbrances. As defined in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section ~~1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~2.09.

Appears in 1 contract

Samples: Mortgage, Security Agreement and Fixture Filing (Taubman Centers Inc)

Letter of Credit. (i) Within ~~forty-five~~ ten (4510) ~~days~~ Business Days after the ~~mutual execution and delivery of this Lease~~Effective Date, ~~Tenant~~ Merchant shall deliver to ~~Landlord, as collateral for~~ TDFS an Eligible Letter of Credit in the ~~full and faithful performance by Tenant~~ amount of ~~all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit~~ five hundred thousand US Dollars (US$500,000) (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Credit Amount”). ~~Tenant shall provide Landlord with a specimen~~ If, at any time, an event occurs that would cause any Letter of Credit ~~from the approved issuer prior~~ previously delivered to ~~the execution of this Lease. The~~ TDFS to cease to be an Eligible Letter of Credit ~~shall be: (a) at sight and irrevocable; (b) maintained~~ or no longer be in ~~effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject~~ an amount equal to ~~the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier~~ or greater than the Letter of Credit ~~Termination Date~~ Amount, within ten (10) Business Days of the earlier of (i) the date on which Merchant learns of the occurrence of such event; or ~~provide for automatic renewal~~ (ii) the date on which Merchant receives notice thereof ~~at least through~~ from TDFS, Merchant will cause a substitute Eligible Letter of Credit to be issued and delivered to TDFS in a face amount equal to or greater than the Letter of Credit ~~Expiration Date, unless~~ Amount. Within the ~~issuing bank provides at least thirty~~ earlier of (30a) fourteen (14) days ~~prior written~~ of notice ~~to Landlord~~ from the issuer of ~~such non-renewal by certified mail, return receipt requested at~~ the ~~address set forth on the form of~~ then outstanding Letter of Credit ~~attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least~~ that the same will not be renewed; and (b) thirty (30) days prior to the expiration of each Letter of Credit provided to TDFS, Merchant will cause a substitute Eligible Letter of Credit to be issued and delivered to TDFS in a face amount equal to or greater than the Letter of Credit ~~without~~ Amount and in such case TDFS shall deliver the expiring Letter of Credit to Merchant. Any amounts drawn under a Letter of Credit hereunder in excess of the amounts due TDFS hereunder will be held by TDFS in a non-interest bearing account on TDFS’s books (the “Collateral Account”) and shall secure Merchant’s full and prompt payment of all further amounts due hereunder. If Merchant fails to pay any ~~action whatsoever on the part~~ amounts hereunder when due and such amount has not been paid or satisfied within five (5) Business Days of ~~Landlord; (c) subject~~ notice by TDFS to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any feesMerchant, ~~costs or expenses in connection with any such transfer)~~TDFS may immediately, and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition without further notice to ~~the foregoing~~Merchant, ~~the form and terms of~~ further draw on the Letter of Credit (or, if applicable, debit any such unpaid amount from any amounts then remaining in the Collateral Account and apply the ~~bank issuing the same) shall be acceptable to Landlord,~~ equivalent in ~~Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an~~ Canadian Dollars of such amount up to the ~~face amount of the~~ unpaid amounts. In addition, if Merchant fails to provide a substitute or replacement Eligible Letter of Credit ~~upon the presentation to the issuing bank of Landlord’s (~~as required by this Section 4(c) or ~~Landlord’s then managing agent’s) written statement that Landlord~~ if Merchant is ~~entitled to make such drawing~~ in default under this ~~Lease~~Agreement and such default has not been remedied by Merchant within five (5) Business Days of notice by TDFS to Merchant, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) TDFS may draw on the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer full amount available under the Letter of Credit, apply the equivalent in ~~whole or~~ Canadian Dollars to any amounts received in ~~part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor~~such drawing against Merchant’s outstanding unpaid obligations hereunder, and ~~it is agreed that~~ credit the ~~provisions hereof shall apply to every transfer or assignment of~~ Collateral Account with the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to ~~the deficiency (or a replacement letter of credit~~ any remaining balance. TDFS’s security interest in the ~~total amount of the LC Amount) and any such additional (or replacement) letter of credit~~ Collateral Account shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in ~~effect and delivered~~ addition to ~~Landlord, as applicable, not later than thirty~~ any right of setoff or recoupment that TDFS may otherwise have under this Agreement or Applicable Law. (30ii) ~~days prior~~ Subject only to ~~the expiration of~~ any unsatisfied setoff rights TDFS may have against the Letter of Credit or ~~amendment)~~the Collateral Account, which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall TDFS will return the Letter of Credit or any ~~renewal thereof or substitute therefor or Cash~~ unapplied amounts in the Collateral ~~be:~~Account to Merchant within six (6) months from the end of the promotional period of the longest outstanding promotion existing at the date of termination. (eiii) ~~deemed to be or treated as a “security deposit” within~~ For the ~~meaning~~ purposes of ~~California Civil Code Section 1950.7; (f) subject to~~ this Agreement, the following terms ~~of such Section 1950.7; or (g) intended to serve as a “security deposit” within~~ shall have the ~~meaning of such Section 1950.~~following meanings:

Appears in 1 contract

Samples: Private Label Credit Card Program Agreement (Zale Corp)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after the mutual execution and delivery of this Lease,~~ Tenant shall ~~deliver to Landlord~~cause an irrevocable, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable~~ transferable letter of ~~credit (the “Letter of Credit”)~~credit, substantially in the form of Exhibit F attached ~~as Exhibit G~~ hereto (the "Letter of Credit"), to be issued and ~~made a part hereof, and containing the terms required herein, payable in the State of California, running~~ outstanding in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at ~~sight and irrevocable; (b) maintained in effect for the entire period~~ all times from the date ~~of execution of this Lease through the date which is~~ hereof until sixty (60) days ~~following~~ after the ~~Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph~~ expiration or earlier termination of this ~~Article 27, provide that the expiration date of the~~ Lease. Each Letter of Credit shall (i) be ~~no earlier than~~ issued by a domestic United States financial institution with a credit rating of at least A1 by Moody's Investors Service, Inc. (or upon modification or replacement xx xxxh financial rating system, its then equivalent rating) (the "Required Credit Rating") and otherwise acceptable to Landlord (the "Letter of Credit ~~Termination Date or provide for automatic renewal thereof~~ Provider"), (ii) have an expiration date of not earlier than one calendar year following the date of issue, (iii) at ~~least through~~ all times be in an available amount (the "Required Letter of Credit ~~Expiration Date~~Amount") of not less than nine (9) months of Base Rent, which as of the date hereof is $240,131.25, and (iv) provide that during the Term it shall be automatically extended for an additional period of one year from the scheduled expiration date unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to ~~the expiration of~~ such date Landlord receives from the Letter of Credit ~~without any action whatsoever on the part~~ Provider thereof notice in writing that such Letter of ~~Landlord; (c) subject~~ Credit Provider elects not to ~~the Uniform Customs and Practices~~ renew such Letter of Credit for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such ~~transfer), and permit partial draws~~additional period. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of If the Letter of Credit ~~(and the bank issuing the same) shall be acceptable~~ Provider elects not to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the renew such Letter of Credit ~~upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make~~ for such ~~drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity~~additional period, then ~~such statement~~ Tenant shall ~~be signed by an officer (if~~ cause a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said new Letter of Credit to be issued in replacement thereof from a ~~new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the~~ Letter of Credit ~~shall be less than the LC Amount, Tenant shall, within ten~~ Provider at least fifteen (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (3015) days prior to the expiration date of the existing Letter of Credit; provided, however, that Tenant shall not permit an existing Letter of Credit to expire until such new Letter of Credit has been issued. (b) If, while a Letter of Credit is required to be outstanding hereunder, the financial rating of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if Provider providing the Letter of Credit is ~~not timely renewed or~~ less than the Required Credit Rating, then Landlord may require Tenant to provide, and Tenant shall provide, a ~~substitute or amendment to letter~~ replacement Letter of Credit issued by a Letter of Credit Provider with a credit ~~is not timely received~~rating that meets the Required Credit Rating within thirty (30) days of demand therefor by Landlord, ~~or if~~ which replacement Letter of Credit shall comply with the terms of Section 1.04(a) hereof, provided that nothing in this Section 1.04(b) shall affect the obligations of Tenant ~~fails to maintain~~ under Section 1.04(a) hereof. Promptly following receipt of such replacement Letter of Credit, Landlord shall surrender the Letter of Credit ~~in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right~~ being replaced to ~~present~~ the Letter of Credit to Provider thereof. (c) Notwithstanding the ~~issuing bank in accordance with~~ foregoing, on the ~~terms~~ one year anniversary of ~~this Article 27~~the Commencement Date and each anniversary thereafter, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may ~~suffer as a result of any default~~ (by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned providing written notice thereof to Tenant~~. Landlord shall have~~ ) reduce the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Required Letter of Credit ~~and/or utilize~~ Amount by an amount equal to two (2) months of Base Rent if (i) Tenant shall have provided Landlord with Tenant's audited financial statements for the ~~Cash Collateral~~prior year (and any other financial statements required under Section 20.18 hereof), (ii) Landlord decides, in ~~part or in whole~~its sole discretion, to that the ~~extent necessary to cure any default~~ financial condition of Tenant ~~and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by~~ merits that the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Required Letter of Credit ~~conditional to justify~~ Amount be so reduced and (iii) no Event of Default shall have occurred at any time during the ~~issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree~~ Term; provided, however, that in no event ~~or circumstance~~ shall the Required Letter of Credit ~~or any renewal thereof or substitute therefor or Cash Collateral be:~~ Amount be less than an amount equal to three (e3) ~~deemed to be or treated as a “security deposit” within the meaning~~ months of ~~California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~Base Rent.

Appears in 1 contract

Samples: Lease (Genta Incorporated /De/)

Letter of Credit. ~~Within forty~~Concurrently upon Sub-~~five (45) days after the mutual~~ Subtenant’s execution ~~and delivery~~ of this ~~Lease~~Sub-Sublease, ~~Tenant~~ Sub-Subtenant shall ~~deliver~~ provide to ~~Landlord~~Sub-Sublandlord an unconditional, ~~as collateral for the full and faithful performance by Tenant~~ clean, irrevocable Letter of ~~all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit~~ Credit (~~the~~ “Letter of Credit”~~), substantially~~ ) in the ~~form attached as Exhibit G hereto~~ amount of Two Million and ~~made a part hereof, and containing the terms required herein, payable in the State of California, running~~ No/100 Dollars ($2,000,000.00) in favor of ~~Landlord,~~ Sub-Sublandlord and issued by a ~~solvent~~ bank ~~reasonably approved~~ (which accepts deposits, maintains accounts and will negotiate a letter of credit, and whose deposits are insured by ~~Landlord under~~ the ~~supervision of the Superintendent of Banks of the State of California, or a National Banking Association,~~ FDIC) located in the ~~initial amount of $[***]~~ San Francisco Bay Area and acceptable to Sub-Sublandlord (“~~LC Amount~~Issuer”)~~. Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease~~. The Letter of Credit shall ~~be:~~ (a1) be fully transferable by Sub-Sublandlord without payment of transfer fees payable by Sub-Sublandlord, (2) permit multiple drawings, and (3) provide that draws, including partial draws, at ~~sight and irrevocable; (b) maintained in effect for~~ Sub-Sublandlord’s election, will be honored upon the ~~entire period from~~ delivery to the ~~date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“~~Issuer. The Letter of Credit ~~Expiration Date~~is to be issued pursuant to ISP98 rather than UCP 500. If (i) Sub-Subtenant fails to pay Rent or any other sums as and when due hereunder and such failure has continued beyond any applicable notice and cure period, (ii) Sub-Subtenant otherwise defaults with respect to any provision of this Sub-Sublease and such default has continued beyond any applicable notice and cure period, or (2) Sub-Subtenant has filed a voluntary petition under the U. S. Bankruptcy Code or any state bankruptcy code (collectively, “Bankruptcy Code”)~~, subject to~~ ; or (3) an involuntary petition has been filed against Sub-Subtenant under the ~~last paragraph of this Article 27, provide~~ Bankruptcy Code; or (4) the Issuer has notified Sub-Sublandlord that ~~the expiration date of~~ the Letter of Credit ~~shall~~ will not be ~~no earlier than the~~ renewed or extended through its final expiration date and Sub-Subtenant fails to deliver to Sub-Sublandlord a replacement Letter of Credit ~~Termination Date or provide for automatic renewal thereof at least through~~ meeting the ~~Letter~~ requirements of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord this Section 5 at least thirty (30) days prior to the expiration of the existing Letter of ~~Credit without~~ Credit, Sub-Sublandlord may (but shall not be obligated to) use, apply or retain all or any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms portion of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result for payment of any ~~application~~ sum for which Sub-Subtenant is obligated or ~~use by Landlord of all~~ which will compensate Sub-Sublandlord for any loss or ~~any part of the Letter of Credit, the amount~~ damage which Sub-Sublandlord may suffer thereby. Any draw or partial draw of the Letter of Credit shall ~~be less than~~ not constitute a waiver by Sub-Sublandlord of its right to enforce its other remedies hereunder, at law or in equity. If any portion of the ~~LC Amount~~Letter of Credit is drawn upon, ~~Tenant~~ Sub-Subtenant shall, within ten (10) ~~business~~ days ~~thereafter~~after delivery of written demand from Sub-Sublandlord, ~~provide Landlord with an additional letter(s~~restore said Letter of Credit to its original amount. The Letter of Credit shall be in effect for the entire term of this Sub-Sublease plus ninety (90) ~~of credit, in an amount equal to~~ days beyond the ~~deficiency (or a replacement letter of credit in the total amount~~ expiration of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by TenantSub-Sublease term. ~~Tenant further covenants and warrants that it will neither assign nor encumber the~~ The Letter of ~~Credit, or any part thereof and that neither Landlord nor its successors or assigns~~ Credit will ~~be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting~~ automatically renew each year during the ~~generality of~~ Sub-Sublease term unless the ~~foregoing, if~~ beneficiary under the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than is given at least thirty (30) days prior to notice of a non-renewal by the ~~expiration of the Letter of Credit or amendment)~~Issuer, ~~which~~ and Sub-Sublandlord shall be ~~irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable~~ able to ~~Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain~~ draw on the Letter of Credit in the ~~amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter~~ event of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of such notice. The parties agree that the provisions of ~~this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned~~ Civil Code Sections 1950.7 and 1951.7 do not apply to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any ~~renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within~~ proceeds from the ~~meaning~~ Letter of ~~California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~Credit.

Appears in 1 contract

Samples: Sub Sublease Agreement (Upstart Holdings, Inc.)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution and delivery of this Lease~~On or before June 1, 2018, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under ~~this~~ the Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), ~~substantially~~ in ~~the~~ form ~~attached as Exhibit G hereto~~ and ~~made a part hereof, and containing the terms required herein~~substance reasonably acceptable to Landlord, payable in the ~~State~~ County of Los Angeles, California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the ~~initial~~ amount of $~~[***]~~ 475,000.00 (the “LC Amount”). Tenant shall ~~provide Landlord with~~ deliver a ~~specimen~~ draft of the Letter of Credit ~~from~~ to Landlord on or before May 15, 2018 to allow Landlord an opportunity to review the ~~approved issuer~~ same and provide changes required to conform to this Section 18 prior to issuance of the ~~execution~~ original Letter of ~~this Lease~~Credit. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of ~~execution~~ the Letter of ~~this Lease~~ Credit through November 30, 2023 (the ~~date which is sixty (60) days following the Termination Date (~~“Letter of Credit Expiration Date”)~~, subject to the last paragraph of this Article 27,~~ ; provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit ~~Termination~~ Expiration Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least ~~thirty~~ sixty (3060) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested (or overnight service with a signature required upon receipt) at the ~~address set forth on the form of Letter of Credit attached as Exhibit G~~following address: Xxxxxxx Xxxxxx Management LLC, ~~or in such form as is otherwise approved by Landlord~~000 Xxxxxxxx Xxxxxxxxx, ~~in its reasonable discretion~~Xxxxx 000, ~~and~~Xxxxx Xxxxxx, ~~in such event~~Xxxxxxxxxx 00000, Attention: Chief Financial Officer, and Tenant shall deliver a new Letter of Credit to Landlord at least ~~thirty~~ sixty (3060) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in ~~this~~ the Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws~~. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION~~. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under ~~this~~ the Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part (or cause a substitute letter of credit to be delivered, as applicable) to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC ~~Amount~~Amount (as such amount may be reduced in accordance with the last paragraph of this Section 18), Tenant shall, within ~~ten~~ five (105) business days thereafter, provide Landlord with an additional letter(s) of ~~credit,~~ credit in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this ~~Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant~~Section 18. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the ~~Lease~~ Letter of Credit Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of ~~Credit or amendment~~Credit), which shall be irrevocable and automatically renewable as above provided through the ~~Lease~~ Letter of Credit Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute ~~or amendment to~~ letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this ~~Article 27~~Section 18, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this ~~Article 27~~Section 18, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this ~~Article 27~~Section 18. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond ~~all~~ any applicable ~~notice and cure periods~~grace period, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, ~~to the extent necessary~~ to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default~~, as may be permitted by the express terms and conditions of this Lease~~. ~~Xxxxxx~~ Tenant agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, ~~[***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION.~~ regardless of whether any dispute exists between ~~Xxxxxx~~ Tenant and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (ea) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (fb) subject to the terms of such Section 1950.7; or (gc) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Office Lease (Ziprecruiter, Inc.)

Letter of Credit. ~~Within forty-five (45) days after~~ In order to secure the ~~mutual execution and delivery of this Lease, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its~~ Agent’s obligations under this ~~Lease~~Agreement, in respect of (x) the payment of the Remaining Guaranteed Amount, and (y) Expenses of the Sale on the Payment Date, Agent shall furnish Merchant an irrevocable ~~and unconditional negotiable~~ standby letter of credit naming Merchant and GECC as co-beneficiaries (collectively, the “Beneficiaries”) as beneficiary in the aggregate original face amount equal to the sum of (i) ten percent (10%) of the estimated Guaranteed Amount, plus (ii) three (3) weeks estimated Expenses that would be payable by Merchant, which shall be in the form of Exhibit 3.4 hereof (collectively, the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall ~~be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the~~ have an expiry date of ~~execution of this Lease through the date which is~~ no earlier than sixty (60) days ~~following~~ after the Sale Termination ~~Date (“Letter of Credit Expiration~~ Date~~”), subject to~~ . Unless the ~~last paragraph of this Article 27, provide that the expiration date of the Letter of Credit~~ parties shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlordhave mutually agreed, in ~~its reasonable discretion~~consultation with GECC, ~~and~~that they have completed the final reconciliation under this Agreement, ~~in such event~~then, ~~Tenant shall deliver a new Letter of Credit to Landlord~~ at least thirty (30) days prior to the ~~expiration of~~ initial or any subsequent expiry date, the Beneficiaries shall receive an amendment to the Letter of Credit ~~without any action whatsoever on~~ solely extending (or further extending, as the ~~part of Landlord;~~ case may be) the expiry date by at least sixty (c60) ~~subject~~ days. If the Beneficiaries fail to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any receive such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition amendment to ~~the foregoing, the form and terms of~~ the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not no later than thirty (30) days ~~prior to~~ before the ~~expiration of~~ expiry date, then all amounts hereunder shall become immediately due and payable and the ~~Letter of Credit~~ Beneficiaries, individually or ~~amendment)~~collectively, ~~which~~ shall be ~~irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable~~ permitted to ~~Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain~~ draw under the Letter of Credit in payment of amounts owed and the Beneficiaries shall hold the balance of the amount ~~and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present~~ drawn under the Letter of Credit as security for amounts that may become due and payable to Merchant hereunder. At Agent’s request, the ~~issuing bank in accordance with~~ Beneficiaries shall take all actions reasonably required to reduce the ~~terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”)~~ amount available to be ~~held as collateral for performance of all of Tenant’s obligations~~ drawn under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit ~~and/or utilize~~ by amounts credited against the ~~Cash Collateral~~Guaranteed Amount; provided, ~~in part or in whole~~however, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render that the Letter of Credit ~~conditional~~ shall not be reduced below three (3) weeks of estimated Expenses of the Sale. In the event that Agent, after receipt of three (3) business days notice (which notice shall not be required if Agent or any member of Agent shall be a debtor under title 11, United States Code), fails to ~~justify~~ pay the ~~issuer of~~ Guaranteed Amount, or portion thereof or any Expenses when due, the Beneficiaries, individually or collectively, may draw on the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject an amount equal to the ~~terms~~ unpaid, past due, amount of ~~such Section 1950.7; or (g) intended to serve as~~ the Agent’s obligations hereunder that is not the subject of a ~~“security deposit” within the meaning of such Section 1950~~reasonable dispute.

Appears in 1 contract

Samples: Agency Agreement (Borders Group Inc)

Letter of Credit. Within ~~forty-five~~ thirty (4530) days ~~after~~ following the ~~mutual~~ full execution ~~and delivery~~ of this Lease, Tenant shall deliver to Landlord, as ~~collateral~~ protection for the full and faithful performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer (or that Landlord reasonably estimates it may suffer) as a result of any breach, default or failure to perform by Tenant under this Lease, an irrevocable and unconditional negotiable ~~letter~~ standby Letter of ~~credit~~ Credit (~~the~~ “Letter of Credit”), ~~substantially~~ in the form ~~attached~~ as ~~Exhibit G hereto and made a part hereof, and containing the terms required herein~~is reasonably acceptable to Landlord, payable at an office in the ~~State~~ San Francisco Bay Area, California or permit the draw of ~~California~~the letter of credit by overnight courier, running in favor of ~~Landlord~~Landlord and issued a solvent, ~~issued by~~ nationally recognized bank with a ~~solvent bank reasonably approved by Landlord~~ long term rating of BBB or higher, under the supervision of the Superintendent of Banks of the State of California, or a ~~National Banking Association~~national banking association (an “Acceptable Issuing Bank”), in the ~~initial~~ amount provided in Section 1.11 of ~~$[***]~~ this Lease (the “LC Letter of Credit Amount”). Tenant shall ~~provide~~ pay all expenses, points, or fees incurred by Tenant in obtaining the Letter of Credit and any replacement Letter of Credit. The bank issuing the Letter of Credit (the “Bank”) shall be subject to Landlord’s prior written approval, which approval shall not be withheld by Landlord ~~with~~ if the proposed Bank is an Acceptable Issuing Bank. As of the Lease Reference Date, subject to the remainder of this Section 8.3, Square 1 Bank is an Acceptable Issuing Bank. If an Acceptable Issuing Bank is declared insolvent or taken over by the Federal Deposit Insurance Corporation or any governmental agency for any reason or does not meet the standards to be approved an Acceptable Issuing Bank, Tenant shall deliver a ~~specimen~~ replacement Letter of Credit from another Bank approved by Landlord that meets the ~~approved issuer prior to~~ standards for an Acceptable Issuing Bank within the ~~execution~~ earlier of ~~this Lease~~(i) thirty (30) days after notice from Landlord that the Bank does not meet the standard for an Acceptable Issuing Bank, or (ii) the date the Bank is declared insolvent or taken over for any reason by the Federal Deposit Insurance Corporation or any other governmental agency. ~~The~~ In addition, the Letter of Credit shall beexpressly provide for the following: (a1) shall be “callable” at ~~sight~~ sight, irrevocable, and ~~irrevocable~~unconditional; (b2) shall be maintained in ~~effect~~ effect, whether through renewal or extension, for the ~~entire~~ period from the date of ~~execution of~~ this Lease ~~through~~ and continuing until the date ~~which is sixty~~ (~~60) days following~~ the ~~Termination Date (~~“Letter of Credit Expiration Date”) that is sixty (60) days after the expiration of the Term (as the Term may be extended). The Letter of Credit may be for one year period, ~~subject~~ provided the Letter of Credit is automatically extended for not less than a one year period unless the issuing Bank provides written notice to Landlord not less than sixty (60) days prior to the ~~last paragraph of this Article 27, provide that the~~ then expiration date of the Letter of Credit ~~shall be no earlier than~~ that the issuing Bank will not renew or extend the Letter of ~~Credit Termination Date or provide for automatic renewal thereof at least through the~~ Credit, in which case Tenant shall deliver to Landlord a replacement Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least not less than thirty (30) days prior to the scheduled expiration date of the then existing Letter of Credit held by Landlord without any action whatsoever on the part of Landlord; (c3) shall be fully assignable by Landlord, its successors, and assignees of its interest in the Leased Premises; (4) shall permit partial draws and multiple presentations and drawings; and (5) shall be otherwise subject to the Uniform Customs and Practices for Documentary ~~Credits (1993-Rev)~~ Credits, International Chamber of Commerce Publication ~~#600; and~~ No. 600 (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnershipUCP600), or ~~any authorized party~~ the International Standby Practices-ISP 98, International Chamber of Commerce Publication No. 590 (~~if another entity~~1998); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Office Lease (Tobira Therapeutics, Inc.)

Letter of Credit. (A) Within ~~forty-five~~ fifteen (4515) days after the ~~mutual~~ execution ~~and delivery of this Lease~~hereof, Tenant shall deliver to ~~Landlord~~Landlord a clean, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease~~unconditional, ~~an irrevocable and unconditional negotiable~~ irrevocable, transferable letter of credit (the “"Letter of Credit~~”), substantially~~ ") in ~~the form attached as Exhibit G hereto and made a part hereof~~form, and ~~containing the terms required herein, payable in the State of California, running in favor of Landlord,~~ issued by a ~~solvent bank reasonably approved by~~ financial institution ("Issuer") satisfactory to Landlord ~~under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association,~~ in ~~the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease~~Landlord's sole discretion. The Letter of Credit shall ~~be:~~ be in the amount of Four Hundred Eighty-Five Thousand and 00/100 Dollars (~~a) at sight~~ $485,000.00), name Landlord as the beneficiary thereunder, and ~~irrevocable; (b) maintained in effect for~~ provide that draws thereunder will be honored upon receipt by Issuer of a written statement signed by Landlord or Landlord's authorized agent stating that Landlord is drawing down on the ~~entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“~~Letter of Credit ~~Expiration Date”), subject~~ pursuant to the ~~last paragraph~~ terms of this, Lease. Landlord shall be entitled to draw the entire amount under the Letter of Credit if either (i) Tenant commits an Event of Default under this ~~Article 27~~Lease, ~~provide that~~ (ii) Tenant does not deliver to Landlord a replacement letter of credit from Issuer or another financial institution satisfactory to Landlord in Landlord's sole discretion in the amount and form of the initial Letter of Credit no later than one month before the expiration date of the then existing Letter of Credit, or (iii) upon a proposed sale or other transfer of the Building, the Land, this Lease, or Landlord (including consolidations, mergers or other entity changes Tenant does not deliver to any such transferees, successors or assigns a replacement Letter of Credit pursuant to the provisions of (c) below. Any amount drawn under the Letter of Credit shall be ~~no earlier than~~ held or applied by Landlord as a Security Deposit, subject to, the terms of Section 4 of this Lease. (B) Tenant shall not assign or encumber or attempt to assign or encumber the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns ~~will~~ shall be bound by any such ~~assignment, encumbrance,~~ assignment or encumbrance or attempted assignment or ~~attempted~~ encumbrance~~. Without limiting the generality of the foregoing, if~~ . (C) If Landlord shall be holding the Letter of Credit ~~expires earlier than~~ as security, then, in the ~~Lease Expiration Date~~event of a proposed sale or lease of the Building by Landlord, ~~Landlord will accept~~ Tenant will, upon ten (10) Business Days' notice, at its sole cost and expense, cause the issuing bank to consent to the assignment or to issue a ~~renewal letter of credit or~~ substitute letter of credit on identical terms except for the stated beneficiary, from the same issuing bank or another bank acceptable to Landlord in Landlord's sole discretion, naming the new landlord as the beneficiary thereof upon delivery by Landlord of the then outstanding Letter of Credit. (~~such renewal or substitute letter~~ D) If, and only if, (x) there has been no Event of ~~credit~~ Default under the Lease during the eighteen (18) months prior to ~~be in effect~~ Reduction Date (as hereinafter defined) and ~~delivered to Landlord, as applicable, not later than thirty~~ (30y) ~~days~~ during each of Tenant's four (4) most recent accounting quarters immediately prior to the ~~expiration~~ Reduction Date Tenant has publicly reported positive net income equal to three (3) times the sum of (A) the Base Rent, and (B) the actual Additional Rent (as such Base Rent and Additional Rent may from time to time change) for each of the same four (4) accounting quarters for which net income is being compared, then when all of the preceding conditions contained in this subsection (d) have been satisfied (the "Reduction Date"), then the amount remaining available to be drawn under the Letter of Credit ~~or amendment), which~~ shall be ~~irrevocable and automatically renewable as above provided through~~ reduced in twelve month increments, beginning twenty-four months after the ~~Lease Expiration Date upon~~ Commencement Date, so the ~~same terms as the expiring Letter of Credit or such other terms as may~~ amount available to be ~~acceptable to Landlord in its reasonable discretion. However, if~~ drawn under the Letter of Credit ~~is not timely renewed or a substitute or amendment to letter~~ shall be as follows: Months (counting from the Commencement Date through Amount Available applicable monthly anniversary of ~~credit is not timely received, or if Tenant fails to maintain~~ Commencement Date Under the Letter of Credit ---------------------------------------------------------------------------------------- 01 - 24 $485,000.00 25 - 36 $388,000.00 37 - 48 $291,000.00 49 - 60 $194,000.00 (E) If (i) there is an initial public offering ("IPO") of Tenant' s stock on any public stock exchange, and (ii) there has been no Event of Default under the Lease during the eighteen (18) months prior to the IPO, or at any time thereafter, then six (6) months after the IPO Landlord agrees to review, in ~~the amount and in accordance with the terms set forth in this Article 27~~Landlord's sole discretion, ~~Landlord shall have the right to present~~ the Letter of Credit to requirement, taking into account Tenant's financial strength, including net income, following the ~~issuing bank in accordance with the terms of this Article 27,~~ IPO and ~~the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of~~ Tenant’s 's obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease ~~beyond all applicable notice and cure periods~~at that time, including obligations with respect to any additional space leased by Tenant hereunder. Based upon such review Landlord ~~may, but without obligation~~ agrees to ~~do so, draw upon the Letter of Credit and/or utilize the Cash Collateral~~consider, in ~~part or in whole~~Landlord's sole discretion, to waiving the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds requirement of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Lease Agreement (Clarent Corp/Ca)

Letter of Credit. ~~Within forty~~The amount set forth in Section 8 of the Summary is referred to herein as the "L-~~five (45) days after~~ C Amount". Concurrently with the ~~mutual~~ full execution and delivery of this Lease, Tenant shall deliver to ~~Landlord~~Landlord an unconditional, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease~~clean, an irrevocable ~~and unconditional negotiable~~ letter of credit (the ~~“Letter~~ "L-C") in an amount equal to fifty percent (50%) of ~~Credit”)~~the L-C Amount. Not later than January 10, ~~substantially~~ 2017, Tenant shall deliver an amendment to the L-C increasing the amount of the L‑C to the full L-C Amount. The L‑C shall be in the form ~~attached as Exhibit G hereto~~ required under this Article 21 and ~~made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord,~~ shall be issued by a ~~solvent~~ money-center bank (a bank which accepts deposits, maintains accounts, and whose deposits are insured by the FDIC) reasonably acceptable to Landlord (the "Bank"), with a short term Fitch Rating currency rating which is not less than "F2", and a long term Fitch Rating currency rating which is not less than "BBB+" (an "Approved Bank"), and which shall either have a local Los Angeles office which will negotiate a letter of credit, or which will allow presentation by facsimile or nationally recognized overnight courier. Landlord hereby agrees that each of Xxxxx Fargo Bank, N.A., Bank of America, N.A., and Citibank, N.A., is currently deemed to be an Approved Bank. Tenant acknowledges that Landlord shall have no obligation to pay any "Improvement Allowance" as provided under the Work Letter until such time as Tenant has provided the L-C. The L-C shall be in a form and content substantially similar to the rom approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. Tenant shall pay all expenses, points and/or fees incurred by Tenant in obtaining the L-C. The ~~Letter of Credit~~ L-C shall ~~be:~~ (ai) be “callable” at ~~sight~~ sight, irrevocable and ~~irrevocable;~~ unconditional, (bii) be maintained in ~~effect~~ effect, whether through renewal, substitution, replacement or extension, for the ~~entire~~ period from the ~~date of execution of this~~ Lease ~~through~~ Commencement Date and continuing until the date ~~which is sixty~~ (~~60) days following~~ the ~~Termination Date (“Letter of Credit~~ "L-C Expiration Date~~”), subject to the last paragraph of this Article 27, provide~~ ") that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least is thirty (30) days after the expiration of the Lease Term (as the same may be extended, and subject to the terms of Section 21.7, below); provided, however, that if prior ~~written notice~~ to ~~Landlord of such non~~the L-~~renewal~~ C Expiration Date a voluntary petition is filed by ~~certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G~~Tenant, or an involuntary petition is filed against Tenant by any of Tenant’s creditors, under the Bankruptcy Code, then the L-C Expiration Date shall not occur until either all preference issues relating to payments under this Lease have been resolved in such ~~form as is otherwise approved by Landlord~~bankruptcy or reorganization case or such bankruptcy or reorganization case has been dismissed, ~~in its reasonable discretion, and, in such event,~~ and Tenant shall deliver a new ~~Letter~~ L-C or certificate of ~~Credit~~ renewal, substitution, replacement or extension to Landlord at least thirty (30) days prior to the expiration of the ~~Letter of Credit~~ L-C then held by Landlord, without any action whatsoever on the part of Landlord; , (ciii) be fully assignable by Landlord at Landlord's expense to its successors and assigns, (iv) permit partial draws and multiple presentations and drawings, and (v) be otherwise subject to the ~~Uniform Customs and Practices for Documentary Credits~~ "International Standby Practices" (~~1993-Rev~~ISP 98) International Chamber of Commerce (Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transferNo. 590)~~, and permit partial draws~~. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the ~~Letter~~ L-C if any of ~~Credit upon~~ the ~~presentation~~ following shall have occurred or be applicable: (1) such amount is then due and owing to Landlord under the terms of this Lease, Landlord has provided any notice to Tenant required under the terms of this Lease and any grace or cure period applicable to the ~~issuing bank~~ payment of ~~Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make~~ such ~~drawing~~ amount has expired under this Lease, ~~it being understood that if Landlord~~ or ~~its managing agent be~~ (2) Tenant has filed a ~~corporation~~voluntary petition under the U. S. Bankruptcy Code or any state bankruptcy code (collectively, ~~partnership or other entity, then such statement shall be signed by an officer~~ "Bankruptcy Code") which has not been dismissed within thirty (~~if a corporation), a general partner (if a partnership)~~30) days, or ~~any authorized party~~ (~~if another entity);~~ 3) an involuntary petition has been filed against Tenant under the Bankruptcy Code and has not been dismissed within thirty (ii30) days, or (4) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Bank has notified Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the ~~provisions hereof shall apply to every transfer~~ L-C will not be renewed or ~~assignment of~~ extended through the ~~whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of~~ L-C Expiration Date and Tenant does not replace the ~~Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall,~~ L-C within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the ~~expiration of the Letter of Credit or amendment), which shall~~ L-C Expiration Date. The L-C will be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted honored by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. Bank regardless of whether ~~any dispute exists between Xxxxxx and Landlord as to~~ Tenant disputes Landlord’s right to draw ~~from~~ upon the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.L-C. 760812.06/WLA375983-00004/11-2-16/ejs/ejs 45 COLORADO CENTER[2400 Broadway][Kite Pharam, Inc.]

Appears in 1 contract

Samples: Office Lease (Kite Pharma, Inc.)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution and delivery of this Lease~~No later than November 1, 1996, Tenant ~~shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease,~~ will provide Landlord with an unconditional irrevocable ~~and unconditional negotiable~~ standby letter of credit (made payable to Landlord and available for drawing in San Francisco, California on a sight draft and Xxxxxxxx's certificate stating that Xxxxxxxx is entitled to draw on the ~~“Letter~~ letter of ~~Credit”)~~credit, in a form substantially in similar to the form attached to this Lease as Exhibit ~~G hereto and made a part hereof, and containing the terms required herein, payable in the State~~ C. The letter of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, credit shall be in the initial amount of $~~[***]~~ 3,000,000 as security for payment of all amounts payable by Tenant under the Lease and the Workletter (~~“LC Amount”~~the "Letter of Credit"). ~~Tenant shall provide Landlord with a specimen~~ Except as otherwise provided herein, the Letter of ~~Credit from~~ Credit, (as it may be renewed or replaced), must stay in effect beginning on November 1, 1996 and continuing throughout the ~~approved issuer prior to the execution~~ Term of this Lease, including renewal terms. The Letter of Credit shall ~~be: (a) at sight~~ be renewed annually, and ~~irrevocable; (b) maintained in effect for~~ must be issued by a bank reasonably acceptable to Landlord. The bank issuing the ~~entire period from the date~~ letter of ~~execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject~~ credit must be required to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides give Landlord at least thirty (30) days prior written notice of intent not to ~~Landlord~~ renew the letter of credit each year. In the event of the receipt of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such eventnotice, Tenant ~~shall deliver~~ must either provide a ~~new Letter~~ replacement letter of ~~Credit~~ credit one (1) week prior to ~~Landlord at least thirty~~ the commencement of the last full week (307 day period) ~~days~~ prior to the expiration of the ~~Letter~~ then current letter of ~~Credit without any action whatsoever~~ credit, or Landlord shall be authorized to draw on the ~~part~~ letter of credit in full and to hold the funds in Landlord~~; (c)~~ 's name, in a separate interest bearing account, as a security deposit, subject to the ~~Uniform Customs~~ provisions below concerning the use and ~~Practices for Documentary Credits (1993-Rev) International Chamber~~ return of ~~Commerce Publication #600; and (d) fully assignable~~ funds held as a security deposit. All interest earned on such funds shall be maintained in such interest bearing account and shall be paid to Tenant at the expiration or sooner termination of this Lease. At Tenant's option, Tenant may instruct Landlord to invest such funds in an conservative manner selected by Tenant which will allow Landlord ~~in connection with any number~~ reasonable access to such funds, but will provide a higher rate of ~~transfers~~ return than an interest bearing account. All of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition the provisions herein concerning relief from the obligation to ~~the foregoing, the form and terms of~~ maintain the Letter of Credit (and ~~the bank issuing the same) shall be acceptable~~ to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, reduce the amount of the Letter of Credit shall apply to such funds held by Landlord. If the requirement of the Letter of Credit would be waived, Landlord shall return such funds and all interest earned thereon to Tenant. If the requirement for the amount of the Letter of Credit would be reduced, Landlord shall return that portion of the funds to Tenant which is equal to the amount of such reduction each time such reduction would occur. Tenant shall execute and deliver, or cause to be executed and delivered, any documents reasonably required in connection with the acquisition of this letter of credit. Landlord shall be entitled to draw on the Letter of credit i) only in the amount necessary to cure an Event of Default with respect to the payment of an amount payable to Landlord by Xxxxxx (including late charges and interest as provided herein) under the Lease, or ii) to fund the completion of Tenant's Work, including any excess costs and damages suffered as a result of Tenant's failure to complete Xxxxxx's Work. Any amount drawn down by Landlord not utilized to cure the Event of Default in question shall be held by Landlord as a security deposit (and returned to Tenant at the expiration or sooner termination of the Lease, less ~~than~~ any amount required to cure a then-existing Event of Default with respect to the ~~LC Amount~~payment of any amount payable to Landlord by Tenant under the Lease, including any amounts properly applicable to repair of the Premises at the end or early termination of the Lease) or, at Tenant's option, shall be deemed credited to Xxxxxx's obligation to pay rent (which credit shall be binding upon any lender or transferee of Landlord's interest). Tenant shall replenish the Letter of Credit to its initial amount following any draw on the Letter of Credit by Landlord in accordance with this Paragraph and the terms and conditions of the Letter of Credit. In the event of any partial draw under the letter of credit, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days ~~prior~~ thereafter, either cause the amount available for draw thereunder to be returned to the ~~expiration~~ full amount, and if Tenant fails to so, such failure shall be an Event of Default and Landlord may terminate this Lease and draw on the letter of credit and/or exercise its other Remedies. Tenant shall be responsible for Landlord's damages caused by such default. In the event that Tenant achieves a Standard and Poor's investment grade rating of BBB or better during the term, as it may be extended, of the Lease, this Letter of Credit requirement shall be deemed waived. In the event that Tenant exercises its option to extend the term of the Lease, and the amount of the Letter of Credit ~~or amendment)~~has been reduced in accordance with the last paragraph of this section 6, ~~which shall be irrevocable and automatically renewable as above provided through~~ then the ~~Lease Expiration Date upon the same terms as the expiring~~ Letter of Credit shall be adjusted (or ~~such other terms as may be acceptable~~ replaced with a new Letter of Credit) to ~~Landlord~~ provide for recourse in ~~its reasonable discretion~~the original amount of Three Million Dollars ($3,000,000,00). ~~However~~During the last eighteen (18) months of the then-current term of the Lease (including any extension term), if Tenant has not exercised an option to extend the then current term. Tenant shall have the right to reduce the amount of the Letter of Credit from time to time so long as the amount of the Letter of Credit is not ~~timely renewed or a substitute or amendment~~ reduced below an amount necessary to ~~letter~~ pay the greater of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”i) ~~to be held as collateral for performance of all of Tenant’s obligations~~ any rent due under this Lease ~~and~~ for ~~all losses and damages Landlord may suffer as a result~~ the term remaining at the time of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such ~~replacement letter of credit~~reduction, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: ii) three (e3) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950months' rent.

Appears in 1 contract

Samples: Lease Agreement (Pure Atria Corp)

Letter of Credit. ~~Within forty-five (45) days after~~ If the ~~mutual execution and delivery of this Lease, Tenant shall deliver to Landlord, as collateral~~ Construction Security for the ~~full and faithful performance by Tenant~~ Alterations is a letter of ~~all of its obligations under this Lease~~credit, ~~an irrevocable and unconditional negotiable~~ the following shall apply: The letter of credit (the “Alterations Letter of Credit”)) shall be a clean, ~~substantially in the form attached as Exhibit G hereto and made a part hereof~~irrevocable, ~~and containing the terms required herein, payable in the State~~ standby letter of ~~California, running~~ credit issued in favor of ~~Landlord~~Landlord and shall meet all of the following requirements: Such letter of credit shall be in an amount (the “Alterations LC Amount”) equal to 125% of the reasonably estimated cost of constructing the Alterations, including but not limited to the costs of labor and materials, interest on any funds borrowed to finance such construction (if any), all other financing costs, professional fees, and expenses of complying with all applicable Legal Requirements; shall be issued by a ~~solvent bank reasonably approved by Landlord under~~ Bank at which the ~~supervision~~ letter of credit may be presented for payment; shall be transferable one or more times without payment of any fee; shall be payable in whole or in partial drawings; shall be payable upon presentation of the ~~Superintendent~~ original letter of ~~Banks~~ credit and a sight draft in form reasonably acceptable to Landlord, with the form of sight draft annexed to the letter of credit; shall have an initial term that shall expire not less than six (6) months after the reasonably estimated date of completion of the ~~State of California~~Alterations, ~~or a National Banking Association,~~ and shall automatically renew without amendment for consecutive periods equal in duration to the initial ~~amount~~ term unless the Bank gives Landlord notice of ~~$[***]~~ non-renewal (a “~~LC Amount~~Non-Renewal Notice”~~). Tenant shall provide Landlord with a specimen Letter of Credit from~~ ) by certified or registered mail, return receipt requested, at least 60 days before the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the then expiration date of the letter of credit; shall be governed by ISP 98; and shall be otherwise in form and substance reasonably satisfactory to Landlord. The final expiration date of the Alterations Letter of Credit shall be ~~no earlier than~~ the later of (a) one (1) year after issuance of such letter of credit, and (b) one (1) year following the reasonably estimated completion date of the Alterations. Tenant shall furnish to Landlord, together with the draft Alterations Letter of Credit, evidence of the reasonably estimated cost of construction. Landlord may draw on such Alterations Letter of Credit ~~Termination Date~~ if (i) this Lease is terminated by reason of Tenant’s default; or ~~provide for automatic renewal thereof at least through~~ (ii) any mechanics lien is filed against the Premises that is not discharged within 30 days after Tenant is given notice thereof, or (iii) Tenant fails to complete the Alterations in accordance with the provisions of this Lease, or (iv) Landlord receives notice from the Bank that it is not renewing the Alterations Letter of Credit ~~Expiration Date~~and the conditions described in Subparagraph (4) below have not been met. All costs incurred by Landlord in seeking to draw on the Alterations Letter of Credit, ~~unless~~ including reasonable attorneys’ fees in connection with any litigation relating to the ~~issuing bank provides at least thirty (30) days prior written notice~~ Alterations Letter of Credit, shall be payable by Tenant to Landlord as Additional Rent. The proceeds of ~~such non-renewal by certified mail, return receipt requested at~~ the ~~address set forth on the form of~~ Alterations Letter of Credit ~~attached as Exhibit G~~may be applied against (x) any Rent due Landlord and (y) any damages incurred by Landlord by reason of Tenant’s breach of this Lease, ~~or in such form as is otherwise approved by~~ and (z) the cost of completing the Alterations. If Landlord, ~~in its reasonable discretion~~at any time or from time to time, ~~and~~reasonably requests an amendment of the Alterations Letter of Credit (for example, ~~in such event~~to change the Landlord’s address for notices), Tenant promptly shall ~~deliver a new~~ cause the Alterations Letter of Credit to ~~Landlord at least thirty (30) days prior to~~ be so amended. If the ~~expiration of the~~ Alterations Letter of Credit ~~without any action whatsoever~~ is lost, stolen, or mutilated, Tenant shall cooperate with Landlord, promptly upon Landlord’s request, to replace such Alterations Letter of Credit. If Landlord draws on the ~~part~~ Alterations Letter of Credit, Tenant shall, within five (5) days after demand by Landlord~~; (c) subject~~ , deliver to Landlord an additional letter of credit meeting the ~~Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber~~ requirements of ~~Commerce Publication #600; and (d) fully assignable~~ this Section or amend the existing Alterations Letter of Credit so that, at all times, the amount of the Alterations Letter of Credit held by Xxxxxxxx, together with any Alterations Letter of Credit proceeds held by Landlord not yet applied to any default by Xxxxxx, equals the Alterations LC Amount. Upon Tenant’s request, Xxxxxxxx shall return the Alterations Letter of Credit to Tenant for cancellation or termination (as the case may be), and shall reasonably cooperate with Tenant to effect such cancellation or termination, after all of the following conditions have been met: (i) the Alterations have been Substantially Completed, and (ii) no mechanics liens have been filed against the Premises that have not been discharged of record, and (iii) Tenant is not in ~~connection with any number~~ default of this Lease. If Landlord sells or otherwise transfers of the Land and Landlord’s interest in this ~~Lease (with Tenant bearing any fees~~Lease, ~~costs~~ Landlord may transfer the Construction Security to the vendee or ~~expenses in connection with any~~ transferee. Upon such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall ~~transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties,~~ be released by Tenant from all liability ~~therefor~~for the return of the Construction Security, and ~~it is agreed that~~ Tenant shall look solely to the ~~provisions hereof shall apply to every transfer or assignment~~ new landlord for the return of the ~~whole or any portion of said Letter of Credit~~ Construction Security. To the extent reasonably necessary, and without violating applicable Law, Landlord shall, at no out-of-pocket expense to ~~a new landlord. If~~Landlord, ~~as a result of any application or use by Landlord of all or any part~~ cooperate with Tenant in Tenant's efforts to obtain the required permits, approvals, and authorizations for the construction of the ~~Letter of Credit,~~ Alterations and the ~~amount~~ operation of the ~~Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord~~ Improvements in accordance with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this ~~Article 27~~Lease, including by joining in applications for building permits, subdivision plat approvals, certificates of dedication, public works or other agreements, utility easements, permits for sewer, water and other utility services, and ~~if Xxxxxx fails~~ the dedication to ~~comply with~~ the ~~foregoing terms~~ applicable governmental authorities of ~~this sentence~~such title to or easements for utility, roadway and slope or storm drainage areas or facilities as are reasonably necessary or desirable. At all times during the Term, the ~~same~~ Facility, all other Improvements, all Alterations, and all Personal Property acquired (or leased) by Tenant or Tenant’s Affiliates shall ~~constitute an uncurable default~~ be the property of Tenant, but shall remain on the Premises except as hereinafter provided. During the Term, Tenant alone shall be entitled to all of the tax attributes of ownership of the Facility, all other Improvements, all Alterations and all Personal Property acquired (or leased) by Tenant or Tenant’s Affiliates, including, without limitation, the right to claim depreciation or cost recovery deductions. Upon the expiration or sooner termination of the Term, the Facility, all other Improvements, all Alterations, and all Personal Property acquired (or leased) by Tenant ~~further covenants~~ or Tenant’s Affiliates shall become the sole property of Landlord at no cost to Landlord, free and ~~warrants~~ clear of all liens, leases and encumbrances and in good condition, subject only to reasonable wear and tear, except that ~~it will neither assign nor encumber~~ Tenant may remove from the ~~Letter~~ Premises at the Expiration Date any of ~~Credit~~Tenant’s Personal Property that is moveable, or but any ~~part thereof~~ damage caused by such removal shall be repaired by Tenant in a good and ~~that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance~~workmanlike manner. ~~Without limiting the generality of~~ Notwithstanding the foregoing, if Tenant may replace any fixtures, machinery, equipment and Personal Property from time to time, provided such replacements are new and of quality and utility at least equal to the ~~Letter~~ fixtures, machinery, equipment and Personal Property being replaced. Any such replacements shall remain on the Premises and become the property of ~~Credit expires earlier than~~ Landlord at the expiration or sooner termination of this Lease ~~Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered~~ as provided above. Tenant shall deliver to Landlord, upon request, copies of the “as ~~applicable~~built” plans for all buildings, ~~not later than~~ including the Facility, constructed on the Premises and all material Alterations (including replacements of or material Alterations to building systems, structural alterations to the structural elements of the buildings, and additions to the buildings), including CAD drawings, and any temporary or permanent certificate of occupancy issued with respect to such buildings. Landlord, its architects, engineers and representatives shall have the right to inspect the Land and the Improvements (to the extent then constructed) from time to time during the construction of the Facility and any Alterations. Tenant shall keep the Premises and this Lease free from any lien or other encumbrance filed or recorded in favor of any mechanic, materialman, architect or engineer and free from any similar lien or encumbrance with respect to work, material or services alleged to have been performed for Xxxxxx. If any such lien or encumbrance is filed or recorded, Tenant shall discharge any such lien or encumbrance by bond or otherwise within thirty (30) days ~~prior to the expiration~~ after Tenant receives notice of ~~the Letter of Credit~~ such lien or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretionencumbrance. ~~However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if~~ If Tenant fails to ~~maintain the Letter of Credit in~~ discharge such lien or encumbrance within such thirty (30) day period, Landlord may pay the amount reflected on such lien or encumbrance (or any portion thereof) and any costs, interest, and/or penalties imposed in ~~accordance with~~ connection therewith or take such other action as Landlord deems necessary or desirable to remove such lien or encumbrance, without being responsible for investigating the ~~terms set forth in this Article 27, Landlord shall have the right~~ validity thereof and without regard to ~~present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27,~~ any objection by Tenant. The amount so paid and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held costs incurred by Landlord shall be ~~returned to Tenant~~deemed Additional Rent under this Lease payable within thirty (30) days after Tenant is billed therefor. ~~Landlord shall have the right to hold Cash Collateral~~ Nothing in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed ~~to render the Letter of Credit conditional to justify the issuer~~ in any way to: (a) constitute Landlord's consent or request, express or implied, that any contractor, subcontractor, laborer or materialman provide any labor or materials for any alteration, addition, improvement or repair of the ~~Letter of Credit in failing~~ Premises; or (b) evidence Landlord's agreement to ~~honor a drawing upon~~ subject the Premises to any such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950lien.

Appears in 1 contract

Samples: Ground Lease

Letter of Credit. ~~Within forty-five (45) days after the mutual~~ A. Concurrently with Tenant’s execution ~~and delivery~~ of this Lease, Tenant shall deliver to Landlord, as ~~collateral~~ protection for the full and faithful performance by Tenant of all of its obligations under this ~~Lease~~Lease after taking into account any applicable notice and cure period and for all losses and damages suffered by Landlord as a result of any breach or default by Tenant under this Lease which continues beyond the expiration of any applicable notice and cure period, an irrevocable and unconditional negotiable clean standby letter of credit (the “Letter of Credit”), ~~substantially~~ in ~~the~~ form ~~attached as Exhibit G hereto~~ and ~~made a part hereof~~substance acceptable to Landlord in its sole discretion, ~~and~~ containing the terms required herein, payable in the ~~State~~ City of ~~California~~Phoenix, Arizona, the City of Atlanta, Georgia, the City of Chicago, Illinois, or the City of Scranton, Pennsylvania, running in favor of ~~Landlord,~~ Landlord and issued by (1) the Bank of America, N.A., located in Scranton, Pennsylvania, (2) a ~~solvent~~ solvent, nationally recognized bank ~~reasonably approved by Landlord~~ with a long term rating of AAA or higher, under the ~~supervision~~ provision of the Superintendent of Banks (or equivalent authority) of the State of ~~California~~Arizona, Georgia, or ~~a National Banking Association~~Illinois, or (3) another national banking association, with offices in the City of Phoenix, Arizona, the City of Atlanta, Georgia, or the City of Chicago, Illinois, in the ~~initial amount~~ Letter of ~~$[***] (“LC Amount”)~~Credit Amount set forth on the Lease Schedule. Prior to Tenant’s execution of this Lease, Tenant shall provide to Landlord, for Landlord’s approval, a draft of the proposed form of the Letter of Credit. After Landlord ~~with a specimen~~ approves the draft, Tenant shall provide to Landlord the original Letter of Credit ~~from the approved issuer prior to the~~ concurrently with Tenant’s execution of this Lease. The Letter of Credit shall ~~be:~~ (ai) be “callable” at ~~sight~~ sight, irrevocable and ~~irrevocable;~~ unconditional, (bii) be maintained in ~~effect~~ effect, whether through automatic renewal or extension, for the ~~entire~~ period from the ~~date of execution of this Lease through~~ Commencement Date and continuing until the ~~date which is sixty (60) days following the Termination~~ LC Expiration Date (~~“Letter of Credit Expiration Date”~~as defined below), ~~subject to the last paragraph of this Article 27~~and, ~~provide that the expiration date of~~ if the Letter of Credit ~~shall be no earlier than~~ then held by Landlord is scheduled to expire prior to the ~~Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit~~ LC Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit or certificate of renewal or extension to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit then held by Landlord, without any action whatsoever on the part of Landlord; , (ciii) be fully assignable by Landlord, its successors and assigns, (iv) permit partial draws and multiple presentations and drawings, and (v) be otherwise subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) ), International Chamber of Commerce Publication #~~600; and (d) fully assignable by Landlord in connection with any number~~ 500, or the International Standby Practices-ISP 98, International Chamber of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATIONCommerce Publication #590. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the ~~same~~same [the “Bank”]) shall be acceptable to Landlord, in Landlord’s ~~reasonable~~ sole discretion. If any of the following shall have occurred or be applicable, ~~and shall provide, among other things, in effect that: (i)~~ Landlord, or its then managing ~~agent~~agent or legal counsel, shall have the right to draw ~~down an amount up to the face amount of the Letter of Credit~~ upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, ~~to the extent necessary~~ as needed to cure ~~any~~ such event of default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained ~~or which may be sustained by~~ from such event of default: (1) such amount is due to Landlord ~~resulting from Tenant’s default, as may be permitted by~~ under the ~~express~~ terms and conditions of this ~~Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of~~ Lease (and all applicable notice and cure periods have expired), or (2) Tenant has filed a voluntary petition under the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit U.S. Bankruptcy Code or any ~~renewal thereof or substitute therefor or Cash Collateral be:~~ state bankruptcy code (~~e) deemed to be or treated as a~~ collectively, “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.Bankruptcy

Appears in 1 contract

Samples: Office Lease (Walter Investment Management Corp)

Letter of Credit. ~~Within forty-five (45) days after the mutual~~ Tenant shall deliver to Landlord concurrently with Tenant’s execution ~~and delivery~~ of this Lease, ~~Tenant shall deliver to Landlord~~an unconditional, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease~~clean, an irrevocable ~~and unconditional negotiable~~ letter of credit (the “~~Letter of Credit~~L-C”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, ) in the initial amount of $[***] (the “LC L-C Amount”), which L-C shall be issued by a money-center bank (a bank which accepts deposits, maintains accounts, has a local office in either the City of San Diego or the City of Los Angeles (both, California) which will negotiate a letter of credit, and whose deposits are insured by the FDIC) reasonably acceptable to Landlord (the “Bank”), with a short term Fitch Rating currency rating which is not less than “F2”, and a long term Fitch Rating currency rating which is not less than “BBB+” (an “Approved Bank”). The L-C shall be in a form and content as set forth in Exhibit H, attached hereto. Tenant shall ~~provide Landlord with a specimen Letter of Credit from~~ pay all expenses, points and/or fees incurred by Tenant in obtaining the ~~approved issuer prior to the execution of this Lease.~~ L-C. The ~~Letter of Credit~~ L-C shall ~~be:~~ (ai) be “callable” at ~~sight~~ sight, irrevocable and ~~irrevocable;~~ unconditional, (bii) be maintained in ~~effect~~ effect, whether through renewal or extension, for the ~~entire~~ period ~~from~~ commencing on the date of ~~execution of this~~ the Lease ~~through~~ Commencement Date and continuing until the date ~~which is sixty~~ (~~60) days following~~ the ~~Termination Date (~~“~~Letter of Credit~~ L-C Expiration Date”) that is one hundred twenty (120) days after the expiration of the Lease Term (as the same may be extended), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, and Tenant shall deliver a new ~~Letter~~ L-C or certificate of ~~Credit~~ renewal or extension to Landlord at least ~~thirty~~ sixty (3060) days prior to the expiration of the ~~Letter of Credit~~ L-C then held by Landlord, without any action whatsoever on the part of Landlord; , (ciii) be fully assignable by Landlord, its successors and assigns, (iv) permit partial draws and multiple presentations and drawings, and (v) be otherwise subject to the ~~Uniform Customs and Practices for Documentary Credits~~ “International Standby Practices” (~~1993-Rev~~ISP 98) International Chamber of Commerce (Publication ~~#600; and (d) fully assignable by Landlord in connection with any number~~ No 590). If Tenant exercises its option to extend the Lease Term pursuant to Section 2.2 of ~~transfers of Landlord’s interest in~~ this Lease then, not later than sixty (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition 60) days prior to the ~~foregoing, the form and terms~~ commencement of the ~~Letter~~ Option Term, Tenant shall deliver to Landlord a new L-C or certificate of ~~Credit~~ renewal or extension evidencing the L-C Expiration Date as one hundred twenty (~~and~~ 120) days after the ~~bank issuing~~ expiration of the ~~same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i)~~ Option Term. Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that L-C if ~~Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or~~ any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the ~~whole~~ following shall have occurred or ~~any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the~~ be applicable: (1) such amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable is due to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease, or (2) Tenant has filed a voluntary petition under the U. S. Bankruptcy Code or any state bankruptcy code (collectively, “Bankruptcy Code”), or (3) an involuntary petition has been filed against Tenant under the Bankruptcy Code, or (4) the Bank has notified Landlord that the L-C will not be renewed or extended through the LC Expiration Date. ~~Xxxxxx agrees not to interfere in any way with payment to Landlord of~~ The L-C will be honored by the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. Bank regardless of whether ~~any dispute exists between Xxxxxx and Landlord as to~~ Tenant disputes Landlord’s right to draw ~~from~~ upon the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.L-C.

Appears in 1 contract

Samples: Office Lease (Bridgepoint Education Inc)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution and delivery of this Lease, Tenant shall deliver to Landlord, as collateral~~ As security for the ~~full and faithful~~ performance by Tenant of ~~all~~ Tenant’s obligations hereunder, Tenant shall cause to be delivered to Landlord concurrently with the execution of ~~its obligations under~~ this ~~Lease~~Lease by Tenant, an original irrevocable ~~and unconditional negotiable~~ standby letter of credit (the “Letter of Credit”~~), substantially~~ ) in the ~~form attached~~ amount specified in Article 1 above, naming Landlord as ~~Exhibit G hereto and made~~ beneficiary, which Landlord may draw upon to cure any default under this Lease or to compensate Landlord for any damage Landlord incurs as a ~~part hereof, and containing~~ result of Tenant’s failure to perform any of its obligations hereunder. Any such draw on the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit ~~from the approved issuer prior~~ shall not constitute a waiver of any other rights of Landlord with respect to ~~the execution of this Lease~~such default or failure to perform. The Letter of Credit shall ~~be: (a) at sight~~ be issued by a major commercial bank reasonably acceptable to Landlord, with a San Francisco, California, or New York, New York, service and ~~irrevocable; (b) maintained in effect~~ claim point for the ~~entire~~ Letter of Credit, have an expiration date not earlier than the sixtieth (60th) day after the Expiration Date (or, in the alternative, have a term of not less than one (1) year and be automatically renewable for an additional one (1) year period ~~from~~ unless notice of non-renewal is given by the ~~date of execution of this Lease through the date which is~~ issuer to Landlord not later than sixty (60) days ~~following~~ prior to the ~~Termination Date (“~~expiration thereof) and shall provide that Landlord may make partial and multiple draws thereunder, up to the face amount thereof. In addition, the Letter of Credit ~~Expiration Date”)~~shall provide that, ~~subject to~~ in the ~~last paragraph~~ event of Landlord’s assignment or other transfer of its interest in this ~~Article 27~~Lease, ~~provide that the expiration date of~~ the Letter of Credit shall be freely transferable by Landlord, without charge and without recourse, to the assignee or transferee of such interest and the bank shall confirm the same to Landlord and such assignee or transferee. The Letter of Credit shall provide for payment to Landlord upon the issuer’s receipt of a sight draft from Landlord together with Landlord’s certificate certifying that Landlord is entitled to such payment pursuant to the provisions of this Lease, and with no ~~earlier than~~ other conditions, shall be in the form attached hereto as Exhibit D, and otherwise be in form and content reasonably satisfactory to Landlord. If the Letter of Credit ~~Termination Date or provide for automatic renewal thereof at least through~~ has an expiration date earlier than the ~~Letter of Credit~~ Expiration Date, ~~unless~~ then throughout the ~~issuing bank provides at least thirty~~ term hereof (30including any renewal or extension of the term) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall ~~deliver a new~~ provide evidence of renewal of the Letter of Credit to Landlord at least ~~thirty~~ sixty (3060) days prior to the ~~expiration of~~ date the Letter of Credit ~~without any action whatsoever~~ expires. If Landlord draws on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up pursuant to the ~~face amount of~~ terms hereof, Tenant shall immediately replenish the Letter of Credit ~~upon the presentation~~ or provide Landlord with an additional letter of credit conforming to the ~~issuing bank~~ requirement of ~~Landlord’s (or Landlord’s then managing agent’s) written statement~~ this paragraph so that the amount available to Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) from the Letter of ~~Credit will be honored by~~ Credit(s) provided hereunder is the ~~issuing bank without inquiry as~~ amount specified in Article 1 above. Tenant’s failure to ~~the accuracy thereof and regardless~~ deliver any replacement, additional or extension of ~~whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer~~ the Letter of Credit, or evidence of renewal of the Letter of Credit, within the time specified under this Lease shall entitle Landlord to draw upon the Letter of Credit then in ~~whole or~~ effect and, at Landlord’s election, constitute a default under this Lease. If Landlord liquidates the Letter of Credit as provided in ~~part to~~ the ~~transferee and thereupon~~ preceding sentence, Landlord shall hold the ~~Landlord shall, without any further agreement between~~ funds received from the ~~parties, be released by Tenant from all liability therefor~~Letter of Credit as security for Tenant’s performance under this Lease, and ~~it is agreed that the provisions hereof~~ Landlord shall ~~apply~~ not be required to ~~every transfer~~ segregate such security deposit from its other funds and no interest shall accrue or ~~assignment~~ be payable to Tenant with respect thereto. No holder of a Mortgage, nor any purchaser at any judicial or private foreclosure sale of the ~~whole~~ Project or any portion thereof, shall be responsible to Tenant for such security deposit unless and only to the extent such holder or purchaser shall have actually received the same. If Tenant is not in default at the expiration or termination of ~~said~~ this Lease, Landlord shall return to Tenant the Letter of Credit ~~to a new landlord. If~~or the balance of the security deposit then held by Landlord, as ~~a result of~~ applicable; provided, however, that in no event shall any ~~application or use~~ such return be construed as an admission by Landlord that Tenant has performed all of its covenants and obligations hereunder. Tenant hereby unconditionally and irrevocably waives the benefits and protections of California Civil Code Section 1950.7, and, without limitation of the scope of such waiver, acknowledges that Landlord may use all or any part of the Letter of ~~Credit~~Credit or the proceeds thereof to compensate Landlord for damages resulting from termination of this Lease and the tenancy created hereunder (including, without limitation, damages recoverable under California Civil Code Section 1951.2). The Letter of Credit shall reduce in amount on (i) the first day of the sixty-first (61st) full calendar month following the Rent Commencement Date, (ii) the first day of the seventy-third (73rd) full calendar month following the Rent Commencement Date, (iii) the first day of the eighty-fifth (85th) full calendar month following the Rent Commencement Date, (iv) the first day of the ninety-seventh (97th) full calendar month following the Rent Commencement Date, and (v) the first day of the one hundred ninth (109th) full calendar month following the Rent Commencement Date (each a “Reduction Date”), by the amount of Three Hundred Forty Thousand Dollars ($340,000.00) on each such Reduction Date; provided, however, that if (i) on or prior to the Reduction Date, a default, by Tenant shall have occurred, or (ii) on the Reduction Date, Tenant’s net worth (as defined below) is less than One Hundred Fifty Million Dollars ($150,000,000.00), then the Letter of Credit amount shall not reduce on such date and shall not thereafter reduce. If Tenant is entitled to any such reduction, then Landlord shall cooperate in a commercially reasonable manner with Tenant upon Tenant’s request to replace or amend the then existing Letter of Credit to reflect the reduced amount of the Letter of ~~Credit shall be less than the LC Amount~~Credit; provided, ~~Tenant shall~~however, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event ~~or circumstance~~ shall any such reduction be construed as an admission by Landlord that Tenant has performed all of its covenants and obligations hereunder. Tenant’s “net worth” shall mean the ~~Letter~~ total assets of ~~Credit or any renewal thereof or substitute therefor or Cash Collateral be:~~ Tenant less liabilities (eincluding, without limitation, contingent liabilities) ~~deemed to be or treated~~ of Tenant, as computed in accordance with GAAP. In connection with the test of Tenant’s net worth on a ~~“security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to~~ Reduction Date, Tenant shall provide Landlord with Tenant’s then current quarterly financial statements which satisfy the terms of ~~such~~ Section ~~1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~30.F. below.

Appears in 1 contract

Samples: Lease Agreement (Conceptus Inc)

Letter of Credit. ~~Within forty-five~~ (45i) ~~days after the mutual execution and delivery of this Lease,~~ Tenant shall deliver to Landlord, ~~as collateral for~~ on or before the ~~full and faithful performance by Tenant of all of its obligations under this Lease~~Commencement Date, an unconditional, clean, irrevocable ~~and unconditional negotiable~~ letter of credit (the “~~Letter of Credit~~L-C”) in the amount set forth in Paragraph 2(b)(iii) below (the “L-C Amount”), ~~substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord,~~ which L-C shall be issued by a money-center, solvent and nationally recognized bank (a bank which accepts deposits, maintains accounts, has a Texas office which will negotiate a letter of credit, and whose deposits are insured by the FDIC) reasonably ~~approved by~~ acceptable to Landlord ~~under~~ (such approved, issuing bank being referred to herein as the ~~supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (~~“~~LC Amount~~Bank”), which Bank must have either (i) an S&P long term rating of A (or better) and an S&P short term rating of A-1 (or better) or (ii) a Xxxxx’x long term rating of A2 (or better) and a Xxxxx’x short term rating of P-1 (or better) (collectively, the “Bank’s Credit Rating Threshold”), and which L-C shall be in a form reasonably acceptable to Landlord. Tenant shall ~~provide Landlord with a specimen Letter of Credit from~~ pay all expenses, points and/or fees incurred by Xxxxxx in obtaining the ~~approved issuer prior to the execution of this Lease.~~ L-C. The ~~Letter of Credit~~ L-C shall ~~be:~~ (ai) be “callable” at ~~sight~~ sight, irrevocable and ~~irrevocable;~~ unconditional, (bii) be maintained in ~~effect~~ effect, whether through renewal or extension, for the ~~entire~~ period ~~from~~ commencing on the date of ~~execution of~~ this Lease ~~through~~ and continuing until the date ~~which~~ that is ~~sixty (60)~~ no less than 90 days ~~following~~ after the ~~Termination~~ Expiration Date (the “~~Letter of Credit~~ L-C Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, and Tenant shall deliver a new ~~Letter~~ L-C or certificate of ~~Credit~~ renewal or extension to Landlord at least ~~thirty~~ sixty (3060) days prior to the expiration of the ~~Letter of Credit~~ L-C then held by Landlord, without any action whatsoever on the part of Landlord; , (ciii) be fully assignable by Landlord, its successors and assigns, (iv) permit partial draws and multiple presentations and drawings, and (v) be otherwise subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) ), International Chamber of Commerce Publication #~~600; and (d) fully assignable by Landlord in connection with any number~~ 500, or the International Standby Practices-ISP 98, International Chamber of ~~transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws~~Commerce Publication #590. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the ~~Letter~~ L-C if any of ~~Credit upon~~ the ~~presentation~~ following shall have occurred or be applicable: (A) such amount is due to Landlord under the ~~issuing bank~~ terms and conditions of ~~Landlord’s~~ this Lease and goes unpaid (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnershipbeyond any applicable notice and cure periods), or (B) Tenant has filed a voluntary petition under the U. S. Bankruptcy Code or any ~~authorized party~~ state bankruptcy code (collectively, “Bankruptcy Code”), or (C) an involuntary petition has been filed against Tenant under the Bankruptcy Code, or (D) the Lease has been rejected, or is deemed rejected, under Section 365 of the U.S. Bankruptcy Code, following the filing of a voluntary petition by Tenant under the Bankruptcy Code, or the filing of an involuntary petition against Tenant under the Bankruptcy Code, or (E) the Bank has notified Landlord that the L-C will not be renewed or extended through the L-C Expiration Date, or (F) Tenant is placed into receivership or conservatorship, or becomes subject to similar proceedings under Federal or State law, or (G) Tenant executes an assignment for the benefit of creditors, or (H) if ~~another entity~~(1) any of the Bank’s Fitch Ratings (or other comparable ratings to the extent the Fitch Ratings are no longer available) have been reduced below the Bank’s Credit Rating Threshold, or (2) there is otherwise a material adverse change in the financial condition of the Bank, and Tenant has failed to provide Landlord with a replacement letter of credit, conforming in all respects to the requirements of this Paragraph 2(b) (including, but not limited to, the requirements placed on the issuing Bank more particularly set forth in this Paragraph 2(b)(i);), in the amount of the applicable L-C Amount, within thirty (30) days following Xxxxxxxx’s written demand therefor (with no other notice or cure or grace period being applicable thereto, notwithstanding anything in this Lease to the contrary) (each of the foregoing being an “L-C Draw Event”). The L-C shall be honored by the Bank regardless of whether Tenant disputes Xxxxxxxx’s right to draw upon the L-C. In the event of an assignment by Tenant of its interest in this Lease (and irrespective of whether Landlord’s consent is required for such assignment), the acceptance of any replacement or substitute letter of credit by Landlord from the assignee shall be subject to Landlord’s prior written approval, in Landlord’s reasonable discretion, and the reasonable attorney’s fees incurred by Landlord in connection with such determination shall be payable by Tenant to Landlord within thirty (30) days of billing. (ii) Tenant hereby acknowledges and agrees that Landlord is entering into this Lease in material reliance upon the ~~Letter~~ ability of ~~Credit~~ Landlord to draw upon the L-C upon the occurrence of any L-C Draw Event. In the event of any L-C Draw Event, Landlord may, but without obligation to do so, and without notice to Tenant (except in connection with an L-C Draw Event under Paragraph 2(b)(i)(H) above), draw upon the L-C, in part or in whole, to cure any such L-C Draw Event and to compensate Landlord for any and all damages of any kind or nature sustained or which Landlord reasonably estimates that it will sustain resulting from Xxxxxx’s breach or default of this Lease or other L-C Draw Event and to compensate Landlord for any and all damages arising out of, or incurred in connection with, the termination of this Lease. The use, application or retention of the L-C, or any portion thereof, by Landlord shall not prevent Landlord from exercising any other right or remedy provided by this Lease or by any applicable law, it being intended that Landlord shall not first be ~~honored by~~ required to proceed against the ~~issuing bank without inquiry~~ L-C, and such L-C shall not operate as a limitation on any recovery to which Landlord may otherwise be entitled. Tenant agrees and acknowledges that (i) the L-C constitutes a separate and independent contract between Landlord and the Bank, (ii) Tenant is not a third-party beneficiary of such contract, (iii) Tenant has no property interest whatsoever in the L-C or the proceeds thereof, and (iv) if Tenant becomes a debtor under any chapter of the Bankruptcy Code, Tenant is placed into receivership or conservatorship, or there is an event of a receivership, conservatorship or a bankruptcy filing by, or on behalf of, Tenant, neither Tenant, any trustee, nor Tenant’s bankruptcy estate shall have any right to restrict or limit Landlord’s claim and/or rights to the ~~accuracy~~ L-C or the proceeds thereof by application of Section 502(b)(6) of the U. S. Bankruptcy Code or otherwise. (iii) L-C Amount; Maintenance of L-C by Tenant; Liquidated Damages. (A) The L-C Amount shall initially be equal to the amount set forth in the Item 14 of the Basic Lease Provisions. (B) Subject to the terms and ~~regardless~~ conditions of ~~whether~~ this Paragraph 2(b)(iii), the ~~Tenant disputes~~ L-C Amount shall be reduced as follows: (C) The reduction of the ~~content~~ L-C Amount is subject to each of ~~such statement~~the following conditions (collectively, the “Reduction Condition”): (1) As of the Reduction Date, no event of default then exists; and (~~iii~~2) Tenant’s quarterly Financial Report (hereinafter defined) evidences that Tenant had earnings before interest, taxes, depreciation and amortization (EBITDA), as determined in accordance with GAAP, based on a rolling twelve (12) month basis, equal to or greater than $10,000,000.00 (the “EBITDA Condition”). (D) If Tenant is eligible for a Letter of Credit reduction, Tenant shall have the right to reduce the L-C Amount as set forth above via the delivery to Landlord of either (x) an amendment to the existing L-C (in form and content reasonably acceptable to Landlord) modifying the L-C Amount to the amount then required under this Paragraph 2(b), or (y) an entirely new L-C (in the form and content otherwise required in this Paragraph 2(b)) in the ~~event of~~ total L-C Amount then required under this Paragraph 2(b). If at any time Tenant’s quarterly Financial Report reflects that Tenant no longer satisfies the EBITDA Condition, Tenant must deliver a ~~transfer of~~ new L-C in an amount equal to $1,000,000.00 within thirty (30) days following Landlord’s ~~interest in the Building, Landlord shall transfer the Letter of Credit~~written notice thereof, in ~~whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that~~ which event the provisions ~~hereof~~ of this Paragraph 2(b) shall ~~apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord.~~ then again apply. (E) If, as a result of any ~~application or use~~ drawing by Landlord of all or any ~~part~~ portion of the ~~Letter of Credit~~L-C, the amount of the ~~Letter of Credit~~ L-C shall be less than the LC L-C Amount, Tenant shall, within ~~ten~~ five (105) business days thereafter, provide Landlord with an additional letter(s) of ~~credit,~~ credit in an amount equal to the ~~deficiency (or a replacement letter of credit in the total amount of the LC Amount)~~ deficiency, and any such additional ~~(or replacement~~letter(s) ~~letter~~ of credit shall comply with all of the provisions of this ~~Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant~~Paragraph 2(b). Tenant further covenants and warrants that it will neither assign nor encumber the ~~Letter of Credit,~~ L-C or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the ~~Letter of Credit~~ L-C expires earlier than the ~~Lease~~ L-C Expiration Date, Landlord will accept a renewal ~~letter of credit or substitute letter of credit~~ thereof (such renewal ~~or substitute~~ letter of credit to be in effect and delivered to Landlord, as applicable, not later than ~~thirty~~ ninety (3090) days prior to the expiration of the ~~Letter of Credit or amendment~~L-C), which shall be irrevocable and automatically renewable as above provided through the ~~Lease~~ L-C Expiration Date upon the same terms as the expiring ~~Letter of Credit~~ L-C or such other terms as may be acceptable to Landlord in its reasonable discretion. ~~However, if~~ If the ~~Letter of Credit~~ L-C is not timely ~~renewed or a substitute or amendment to letter of credit is not timely received~~renewed, or if Tenant fails to maintain the ~~Letter of Credit~~ L-C in the amount and in accordance with the terms set forth in this ~~Article 27~~Paragraph 2(b), Landlord shall have the right to present the ~~Letter of Credit~~ L-C to the ~~issuing bank~~ Bank in accordance with the terms of this ~~Article 27~~Paragraph 2(b), and the ~~entire sum evidenced thereby shall~~ proceeds of the L-C may be ~~paid to and held~~ applied by Landlord ~~as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations~~ against any Rent payable by Tenant under this Lease ~~and~~ that is not paid when due and/or to pay for all losses and damages that Landlord ~~may~~ has suffered or that Landlord reasonably estimates that it will suffer as a result of any breach or default by Tenant under this ~~Lease pending~~ Lease. In such event (I) any unused proceeds shall constitute the property of Landlord (and not Tenant’s ~~delivery~~ property or, in the event of a receivership, conservatorship, or a bankruptcy filing by, or on behalf of, Tenant, property of such receivership, conservatorship or Tenant’s bankruptcy estate) and need not be segregated from Landlord’s other assets, and (II) Landlord agrees to pay to Tenant within thirty (30) days after the L-C Expiration Date the amount of any proceeds of the L-C received by Landlord and not applied against any Rent payable by Tenant under this Lease that was not paid when due or used to pay for any losses and/or damages suffered by Landlord (or reasonably estimated by Landlord that it will suffer) as a result of any breach or default by Tenant under this Lease; provided, however, that if prior to the L-C Expiration Date a voluntary petition is filed by Tenant, or an involuntary petition is filed against Tenant by any of Tenant’s creditors, under the Bankruptcy Code, then Landlord shall not be obligated to make such payment in the amount of the unused L-C proceeds until either all preference issues relating to payments under this Lease have been resolved in such bankruptcy or reorganization case or such bankruptcy or reorganization case has been dismissed. (iv) The L-C shall also provide that Landlord may, at any time and without notice to Tenant and without first obtaining Tenant’s consent thereto, transfer (one or more times) all or any portion of its interest in and to the L-C to another party, person or entity, regardless of whether or not such transfer is from or as a part of the assignment by Landlord of its rights and interests in and to this Lease. In the ~~required replacement letter~~ event of ~~credit~~ a transfer of Xxxxxxxx’s interest in under this Lease, Landlord shall transfer the ~~LC Amount~~ L-C, in whole or in part, to the transferee and ~~otherwise complying with~~ thereupon Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the ~~provisions~~ whole of ~~this Article 27~~said L-C to a new sublandlord. ~~Upon delivery~~ In connection with any such transfer of the L-C by Landlord, Tenant shall, at Tenant’s sole cost and expense, execute and submit to the Bank such ~~replacement letter of credit~~applications, ~~any Cash Collateral held by Landlord~~ documents and instruments as may be reasonably necessary to effectuate such transfer and, Tenant shall be ~~returned to Tenant.~~ responsible for paying the Bank’s transfer and processing fees in connection therewith; provided that, Landlord shall have the right (in its sole discretion), but not the obligation, to ~~hold Cash Collateral~~ pay such fees on behalf of Tenant, in which case Tenant shall reimburse Landlord within ten (10) days after Xxxxxx’s receipt of an invoice from Landlord therefor. (v) Landlord and Tenant (1) acknowledge and agree that in no event or circumstance shall the L-C or any renewal thereof or substitute therefor or any proceeds thereof be deemed to be or treated as a ~~deposit account~~ “security deposit” under any law applicable to security deposits in the ~~name of Landlord~~ commercial context, as such Section now exists or as it may be hereafter amended or succeeded (the “Security Deposit Laws”), (2) acknowledge and ~~commingle~~ agree that the ~~Cash Collateral with its general assets~~ L-C (including any renewal thereof or substitute therefor or any proceeds thereof) is not intended to serve as a security deposit, and the Security Deposit Laws shall have no applicability or relevancy thereto, and (3) waive any and all rights, duties and obligations that any such party may now, or in the future will, have relating to or arising from the Security Deposit Laws. Tenant hereby ~~grants Landlord~~ irrevocably waives and relinquishes the provisions of any law, now or hereafter in effect, which (x) establish the time frame by which a landlord must refund a security ~~interest~~ deposit under a lease, and/or (y) provide that a landlord or sublandlord may claim from a security deposit only those sums reasonably necessary to remedy defaults in the ~~Cash Collateral. Tenant shall not be entitled~~ payment of rent, to ~~any interest earned on~~ repair damage caused by a tenant or to clean the ~~Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods~~premises, it being agreed that Landlord may, ~~but without obligation to do so~~in addition, ~~draw upon the Letter of Credit and/or utilize the Cash Collateral,~~ claim those sums specified in ~~part or in whole, to the extent~~ this Paragraph 2(b) and those sums reasonably necessary to ~~cure~~ (A) compensate Landlord for any ~~default~~ loss or damage caused by Xxxxxx’s breach of ~~Tenant~~ this Lease, including any damages Landlord suffers following termination of this Lease, and/or to (B) compensate Landlord for any and all damages ~~of any kind~~ arising out of, or ~~nature sustained or which may be sustained by Landlord resulting from Tenant’s default~~incurred in connection with, ~~as may be permitted by~~ the ~~express terms and conditions~~ termination of this Lease. . (vi) Xxxxxx agrees not to interfere in any way with any payment to Landlord of the proceeds of the ~~Letter of Credit~~L-C, either prior to or following a “draw” by Landlord of all or any portion of the ~~Letter of Credit~~L-C, ~~[***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION.~~ regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw ~~from~~ down all or any portion of the ~~Letter of Credit.~~ L-C. No condition or term of this Lease shall be deemed to render the ~~Letter of Credit~~ L-C conditional ~~to justify~~ and thereby afford the ~~issuer of the Letter of Credit in~~ Bank a justification for failing to honor a drawing upon such ~~Letter of Credit~~ L-C in a timely manner. ~~Landlord and~~ Tenant ~~acknowledge and agree that in no event~~ shall not request or ~~circumstance shall~~ instruct the ~~Letter~~ Bank of ~~Credit or~~ any ~~renewal thereof or substitute therefor or Cash Collateral be:~~L-C to refrain from paying sight draft(s) drawn under such L-C. (evii) ~~deemed~~ Tenant’s sole remedy in connection with the improper presentment or payment of sight drafts drawn under any L-C shall be the right to be obtain from Landlord a refund of the amount of any sight draft(s) that were improperly presented or ~~treated as a “security deposit” within~~ the ~~meaning~~ proceeds of ~~California Civil Code Section 1950.7; (f) subject~~ which were misapplied, together with reasonable interest and reasonable actual out-of-pocket attorneys’ fees, provided that at the time of such refund, Tenant increases the amount of such L-C to the ~~terms~~ amount (if any) then required under the applicable provisions of this Lease. Tenant acknowledges that the presentment of sight drafts drawn under any L-C, or the Bank’s payment of sight drafts drawn under such ~~Section 1950.7; or~~ L-C, could not under any circumstances cause Tenant injury that could not be remedied by an award of money damages, and that the recovery of money damages would be an adequate remedy therefor. In the event Tenant shall be entitled to a refund as aforesaid and Landlord shall fail to make such payment within ten (g10) ~~intended~~ business days after demand, Tenant shall have the right to ~~serve as a “security deposit” within~~ deduct the ~~meaning~~ amount thereof together with reasonable interest thereon from the next installment(s) of ~~such Section 1950~~Base Rent.

Appears in 1 contract

Samples: Industrial Lease (Sow Good Inc.)

Letter of Credit. ~~Within forty-five~~ Landlord currently holds a letter of credit (45“Original LC”) ~~days~~ in the amount of $300,000 (“Original LC Amount”), which Original LC Amount is subject to reduction in accordance with the last grammatical paragraph of Article 24 of the Original Lease and which Landlord shall continue to hold in accordance with the terms of the Original Lease as security for Tenant’s obligation under the Lease. In accordance with the Original Lease, the Original LC Amount shall decrease to $225,000.00 on December 1, 2008; to $150,000.00 on December 1, 2009; and to $75,000.00 on December 1, 2010. There shall be no further reductions of the Original LC Amount thereafter. Notwithstanding the foregoing, the Original LC Amount shall be decreased only if (a) there does not then exist a default or breach by Tenant of its obligations or liabilities under the Lease which continues after the ~~mutual~~ expiration of any applicable cure period, and (b) neither the Lease nor Tenant’s right to possession of the Premises has been terminated. In addition, concurrently with the execution ~~and delivery~~ of this ~~Lease~~First Amendment, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under ~~this~~ the Lease, as amended hereby, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G C hereto and made a part hereof, and containing the terms required herein, payable in the ~~State~~ County of Los Angeles, California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the ~~initial~~ amount of $~~[***]~~ 200,000.00 (“LC Amount”)~~. Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease~~. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this ~~Lease~~ First Amendment through the date which is sixty (60) days following the ~~Termination Date~~ expiration of the Term of the Lease (“Letter of Credit Expiration Date”), ~~subject to the last paragraph of this Article 27,~~ provide that the expiration date ~~of the Letter of Credit~~ thereof shall be no earlier than the Letter of Credit ~~Termination~~ Expiration Date or provide for automatic renewal thereof at least through the ~~Letter of Credit~~ Lease Expiration Date, unless the issuing bank provides at least ~~thirty~~ sixty (3060) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit GC, ~~or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event,~~ and Tenant shall deliver a new Letter of Credit to Landlord at least ~~thirty~~ sixty (3060) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #~~600~~500, as amended or revised; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in ~~this~~ the Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws~~. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION~~. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under ~~this~~ the Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part (or cause a substitute letter of credit to be delivered, as applicable) to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ~~ten~~ five (105) ~~business~~ days thereafter, provide Landlord with an additional letter(s) of ~~credit,~~ credit in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this ~~Article 27~~Section 10, and if ~~Xxxxxx~~ Tenant fails to comply with the ~~foregoing terms of this sentence~~foregoing, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the ~~Lease~~ Letter of Credit Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of ~~Credit or amendment~~Credit), which shall be irrevocable and automatically renewable as above provided through the ~~Lease~~ Letter of Credit Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute ~~or amendment to~~ letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this ~~Article 27~~Section 10, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this ~~Article 27~~Section 10, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under ~~this~~ the Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under ~~this~~ the Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this ~~Article 27~~Section 10. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond ~~all~~ any applicable ~~notice and cure periods~~grace period, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, ~~to the extent necessary~~ to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default~~, as may be permitted by the express terms and conditions of this Lease~~. ~~Xxxxxx~~ Tenant agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, ~~[***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION.~~ regardless of whether any dispute exists between ~~Xxxxxx~~ Tenant and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of ~~this~~ the Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Office Lease (ReachLocal Inc)

Letter of Credit. ~~Within forty-five (45) days after the mutual~~ 5.1. Concurrent with Tenant’s execution and delivery of this Lease, Tenant shall deliver to Landlord, as collateral for the full ~~and faithful~~ performance by Tenant of all of its obligations under this Lease, and for all losses and damages Landlord may suffer as a result of Tenant’s failure to comply with one or more provisions of the Lease in any case which continues beyond any applicable notice and cure periods, including, but not limited to, any post lease termination damages under Section 1951.2 of the California Civil Code, an ~~irrevocable and unconditional negotiable letter~~ Irrevocable Standby Letter of ~~credit~~ Credit substantially in the form attached hereto as Exhibit G (the “Letter of Credit”~~), substantially~~ ) in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of Five Hundred Ninety One Thousand Three Hundred Seven and 44/100 Dollars ($~~[***] (“LC Amount”~~591,307.44). ~~Tenant~~ The following terms and conditions shall ~~provide Landlord with a specimen~~ apply to the Letter of ~~Credit from the approved issuer prior to the execution of this Lease~~Credit: 5.1.1. The Letter of Credit shall ~~be:~~ be in favor of Landlord, shall be issued by a financial institution reasonably acceptable to Landlord but in any event (ai) ~~at sight~~ that is chartered under the laws of the United States, any State thereof or the District of Columbia, and ~~irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date~~ which is ~~sixty (60) days following~~ insured by the ~~Termination Date~~ Federal Deposit Insurance Corporation (“FDIC”), (ii) whose long-term, unsecured and unsubordinated debt obligations have at least a Standard & Poor’s rating of [***] or better. a Xxxxx’x rating of [***] or better, or a Fitch rating of [***] or better, and (iii) either (x) has a letter of credit counter located in Santa Xxxxx County upon which draws can be made in person, or (y) has a local correspondent based in Santa Xxxxx County upon which draws can be made in person without delay. The Letter of Credit ~~Expiration Date”), subject to~~ shall comply with all of the ~~last paragraph~~ terms and conditions of this ~~Article 27~~Paragraph and shall otherwise be in a form acceptable to Landlord, ~~provide that~~ in Landlord’s sole discretion. Landlord hereby pre-approves [***] as the ~~expiration date~~ issuing bank. 5.1.2. The Letter of ~~the~~ Credit or any replacement Letter of Credit shall be no irrevocable for the term thereof and shall automatically renew on a year to year basis until a period ending not earlier than [***] subsequent to the ~~Letter of Credit Termination~~ Expiration Date ~~or provide for automatic renewal thereof at least through~~ (the ~~Letter of Credit~~ “LOC Expiration Date~~, unless the issuing bank provides at least thirty (30~~”) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord~~; (c) subject~~ ; provided that the issuing bank shall have the right not to renew the ~~Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber~~ Letter of ~~Commerce Publication #600; and (d) fully assignable~~ Credit by giving written notice to Landlord ~~in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws.~~ not less than [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition days prior to the ~~foregoing,~~ expiration of the ~~form and terms~~ then current term of the Letter of Credit ~~(and~~ that it does not intend to renew the Letter of Credit. Tenant understands that the election by the issuing bank ~~issuing~~ not to renew the ~~same)~~ Letter of Credit shall ~~be acceptable to Landlord~~not, in ~~Landlord’s reasonable discretion~~any event, ~~and shall provide, among other things,~~ diminish the obligation of Tenant to maintain such an irrevocable Letter of Credit in ~~effect that:~~favor of Landlord through the LOC Expiration Date. ~~(i)~~ 5.1.3. Landlord, or its then ~~managing agent~~authorized representative, upon Tenant’s failure to comply with one or more provisions of this Lease or as otherwise specifically agreed by Landlord and Tenant pursuant to this Lease or any amendment hereof, without prejudice to any other remedy provided in this Lease, or by Applicable Laws, shall have the ~~right~~ right, after expiration of any applicable notice and cure periods, from time to ~~draw down an amount up~~ time to make one or more draws on the Letter of Credit and use all or part of the proceeds in accordance with Paragraph 5.1.4 below. In addition, if Tenant fails to furnish a renewal or replacement letter of credit complying with all of the provisions of this Paragraph 5 at least [***] days prior to the ~~face amount~~ stated expiration date of the Letter of Credit then held by Landlord, Landlord may draw upon such Letter of Credit and hold the proceeds thereof (and such proceeds need not be segregated) in accordance with the terms of this Paragraph 5, provided that any such unused proceeds shall be returned to Tenant upon Tenant providing a replacement Letter of Credit. Funds may be drawn down on the Letter of Credit upon presentation to the issuing bank of Landlord’s (or Landlord’s then ~~managing agent~~authorized representative’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer certification. 5.1.4. Tenant acknowledges and agrees (~~if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii)~~ and the Letter of Credit ~~will~~ shall so state) that the Letter of Credit shall be honored by the issuing bank without inquiry as to the ~~accuracy thereof~~ truth of the statements set forth in such draw request and regardless of whether the Tenant disputes the content of such statement~~; and (iii) in the event~~ . The proceeds of ~~a transfer of Landlord’s interest in the Building, Landlord shall transfer~~ the Letter of ~~Credit, in whole~~ Credit shall constitute Landlord’s sole and separate property (and not Tenant’s property or ~~in part to~~ the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment property of Tenant’s bankruptcy estate). The proceeds of the ~~whole or any portion of said~~ Letter of Credit shall be applied exclusively and only: (a) against any rent or other amounts payable by Tenant under this Lease that is not paid when due and such failure continues beyond any applicable notice and cure period; (b) against all losses and damages that Landlord has suffered or that Landlord reasonably estimates that it may suffer as a result of Tenant’s failure to comply with one or more provisions of this Lease, including any damages arising under Section 1951.2 of the California Civil Code following termination of this Lease; (c) against any costs incurred by Landlord in connection with Tenant’s breach of this Lease (including attorneys’ fees); and (d) against any other amount that Landlord may spend or become obligated to spend by reason of Tenant’s default which continues beyond any applicable notice and cure periods. Provided Tenant has performed all of its obligations under this Lease, Landlord agrees to pay to Tenant within [***] days after the LOC Expiration Date the amount of any proceeds of the Letter of Credit received by Landlord and not applied as allowed above; provided, that if prior to the LOC Expiration Date a voluntary petition is filed by Tenant, or an involuntary petition is filed against Tenant by any of Tenant’s creditors, under the Federal Bankruptcy Code, then Landlord shall not be obligated to make such payment in the amount of the unused Letter of Credit proceeds until either all preference issues relating to payments under this Lease, have been resolved in such bankruptcy or reorganization case or such bankruptcy or reorganization case has been dismissed, in each case pursuant to a ~~new landlord~~final court order not subject to appeal or any stay pending appeal. 5.1.5. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the ~~LC Amount~~amount set forth in this Xxxxxxxxx 0, ~~Tenant~~ Xxxxxx shall, within ~~ten (10) business~~ [***] days thereafter, provide Landlord with an additional letter(s) of ~~credit,~~ credit in an amount equal to the deficiency (or a replacement letter of credit in the total amount ~~of the LC Amount)~~ required pursuant to this Paragraph 5), and any such additional (or replacement) letter of credit shall comply with all of the provisions of this ~~Article 27~~Paragraph 5, and if ~~Xxxxxx~~ Tenant fails to comply with the ~~foregoing terms of~~ foregoing, notwithstanding anything to the contrary contained in this ~~sentence~~Lease, the same shall constitute an ~~uncurable default~~ incurable Event of Default by Tenant (provided, however, so long as Tenant is diligently obtaining a replacement Letter of Credit, Tenant may elect to provide a cash security deposit in an equivalent amount, provided any replacement or additional letter(s) of credit are supplied as promptly as possible, but in any event within [***] days thereafter, at which point the cash security deposit shall be promptly returned to Tenant). Tenant further covenants and warrants that it will neither assign nor encumber the Letter of ~~Credit,~~ Credit or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. 5.1.6. ~~Without limiting~~ Landlord may, at any time and without notice to Tenant and without first obtaining Tenant’s consent thereto, transfer all or any portion of its interest in and to the ~~generality~~ Letter of Credit to another party, person or entity, including Landlord’s mortgagee and/or to have the Letter of Credit reissued in the name of Landlord’s mortgagee. If Landlord transfers its interest in the Building and transfers the Letter of Credit (or any proceeds thereof then held by Landlord) in whole or in part to the transferee and such transferee assumes in writing Landlord’s obligations under this Lease, Landlord shall, without any further agreement between the parties hereto, thereupon be released by Tenant from all liability therefor. The provisions hereof shall apply to every transfer or assignment of all or any part of the ~~foregoing~~Letter of Credit to a new landlord. In connection with any such transfer of the Letter of Credit by Landlord, Tenant shall, at Tenant’s sole cost and expense, execute and submit to the issuer of the Letter of Credit such applications, documents and instruments as may be necessary to effectuate such transfer. Tenant shall be responsible for paying the issuer’s transfer and processing fees in connection with any transfer of the Letter of Credit and, if Landlord advances any such fees (without having any obligation to do so), Tenant shall reimburse Landlord for any such transfer or processing fees within [***]days after Landlord’s written request therefor. 5.1.7. If the Letter of Credit expires earlier than the ~~Lease~~ LOC Expiration Date, or the issuing bank notifies Landlord ~~will~~ that it shall not renew the Letter of Credit, Landlord shall accept a renewal ~~letter of credit~~ thereof or substitute ~~letter~~ Letter of ~~credit~~ Credit (such renewal or substitute ~~letter~~ Letter of ~~credit~~ Credit to be in effect ~~and delivered to Landlord, as applicable,~~ not later than ~~thirty (30)~~ [***] days prior to the expiration ~~of the Letter of Credit or amendment~~thereof), ~~which shall be~~ irrevocable and automatically renewable ~~as above provided~~ through the ~~Lease~~ LOC Expiration Date upon the same terms as the expiring Letter of Credit or upon such other terms as may be acceptable to ~~Landlord in its reasonable discretion~~Landlord. However, if (a) the Letter of Credit is not timely ~~renewed~~ renewed, or (b) a substitute ~~or amendment to letter~~ Letter of ~~credit~~ Credit, complying with all of the terms and conditions of this paragraph is not timely received, ~~or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27,~~ Landlord ~~shall have the right to~~ may present ~~the~~ such Letter of Credit to the issuing ~~bank in accordance with the terms of this Article 27~~bank, and the entire sum ~~evidenced thereby~~ so obtained shall be paid to ~~and held by Landlord as cash (the “Cash Collateral”)~~ Landlord, to be held ~~as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of~~ by Landlord, provided that any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such ~~replacement letter of credit, any Cash Collateral held by Landlord~~ unused proceeds shall be returned to ~~Tenant. Landlord shall have the right to hold Cash Collateral in~~ Tenant upon Tenant providing a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the replacement Letter of Credit. ~~No condition or term of this Lease~~ Notwithstanding the foregoing, Landlord shall be ~~deemed~~ entitled to ~~render~~ receive from Tenant all actual, reasonable and out-of-pocket attorneys’ fees and costs incurred in connection with the review of any proposed substitute Letter of Credit ~~conditional~~ pursuant to ~~justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner~~this Paragraph. 5.1.8. Landlord and Tenant (a) acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or ~~Cash Collateral be: (e)~~ any proceeds thereof be deemed to be or treated as a “security deposit” ~~within~~ under any Applicable Laws applicable to security deposits in the ~~meaning~~ commercial context including Section 1950.7 of the California Civil ~~Code Section 1950.7;~~ Code, as such section now exist or as may be hereafter amended or succeeded (f“Security Deposit Laws”), (b) ~~subject to~~ acknowledge and agree that the ~~terms~~ Letter of ~~such Section 1950.7; or~~ Credit (gincluding any renewal thereof or substitute therefor or any proceeds thereof) is not intended to serve as a “security deposit~~” within~~ , and the ~~meaning~~ Security Deposit Laws shall have no applicability or relevancy thereto, and (c) waive any and all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit Laws. Tenant hereby waives the provisions of Section 1950.7 of the California Civil Code and all other provisions of Applicable Laws, now or hereafter in effect, which (i) establish the time frame by which Landlord must refund a security deposit under a lease, and/or (ii) provide that Landlord may claim from the security deposit only those sums reasonably necessary to remedy defaults in the payment of rent, to repair damage caused by Tenant or to clean the Premises, it being agreed that Landlord may, in addition, claim those sums specified above in this Paragraph 5 and/or those sums reasonably necessary to compensate Landlord for any loss or damage caused by Tenant’s breach of this Lease, or the acts or omission of Tenant, including any damages Landlord suffers following termination of this Lease. 5.1.9. Notwithstanding anything to the contrary contained in the Lease, as amended hereby, in the event that at any time the financial institution which issues said Letter of Credit is declared insolvent by the FDIC or is closed for any reason, Tenant must immediately provide a substitute Letter of Credit that satisfies the requirements of this Lease, hereby from a financial institution acceptable to Landlord, in Landlord’s sole discretion. 5.1.10. If (A) Tenant’s Financial Information (defined below) reflects [***] consecutive calendar quarters of profitability at any time during the Lease Term, as evidenced by Tenant’s Financial Information (the “Profitability Test”), or (B) Tenant has received an additional aggregate [***] in equity funding (the “Equity Funding Test”), then Tenant shall have the right to reduce the Letter of Credit to an amount equal to [***] for the remainder of the Lease Term. If Tenant is entitled to a reduction in the Letter of Credit as provided in this Paragraph 5.1.10, Tenant shall provide Landlord with written notice requesting that the Letter of Credit be reduced as provided above (the “Reduction Notice”). Concurrent with Tenant’s delivery of the Reduction Notice, Tenant shall deliver to Landlord for review Tenant’s most recent audited financial statements prepared in the ordinary course of business or, if unaudited, certified by Tenant’s chief financial officer as being prepared in accordance with Generally Accepted Accounting Principles (“GAAP”) and true, complete and correct in all material respects, and any other financial information reasonably requested by Landlord (“Tenant’s Financial Information”). If Tenant provides Landlord with a Reduction Notice and Tenant is entitled to reduce the face amount of the Letter of Credit as provided herein, any reduction in the face amount of the Letter of Credit shall be accomplished by Tenant providing Landlord with a substitute Letter of Credit in the reduced amount, which substitute Letter of Credit shall comply with the requirements of this Paragraph 5. Notwithstanding anything to the contrary set forth herein, if Tenant has been in monetary default under this Lease beyond any applicable notice and cure period or any material non-monetary default at any time prior to submission of a Reduction Notice, then Tenant’s right to reduce the face amount of the Letter of Credit, as described herein, shall be null and void and of no further force or effect as to any of the reduction opportunities that may remain unexercised by Tenant at such ~~Section 1950~~time.

Appears in 1 contract

Samples: Lease (Outset Medical, Inc.)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution and~~ Simultaneously with Tenant's delivery to Landlord of this Lease, the first month's Base Rent and Security Deposit in accordance with the provisions of Section 3 above, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease, an irrevocable and unconditional negotiable letter of ~~credit (the “Letter of Credit”)~~credit, ~~substantially~~ in the form ~~attached as Exhibit G hereto and made a part hereof,~~ and containing the terms required herein, payable in the ~~State~~ City of ~~California~~Irvine, California running in favor of ~~Landlord,~~ Landlord issued by a solvent bank ~~reasonably approved by Landlord~~ under the supervision of the Superintendent of Banks of the State of California, or a National Banking ~~Association~~Association (the "Issuer"), in the ~~initial~~ amount of Five Hundred Thousand Dollars ($~~[***]~~ 500,000.00), (~~“LC Amount”). Tenant shall provide Landlord with a specimen~~ the "Letter of ~~Credit from the approved issuer prior to the execution of this Lease~~Credit"). The Letter of Credit shall ~~be:~~ be (a) at ~~sight~~ sight, irrevocable and ~~irrevocable;~~ unconditional, (b) maintained in ~~effect for~~ effect, whether through replacement, renewal or extension, until one (1) month after the entire ~~period from~~ Lease Term or until such time as Tenant achieves three (3) successive quarters of positive earnings before interest, taxes, depreciation and amortization as reported in Tenant's audited 10Q (the ~~date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“~~"Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30") days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, and Tenant shall deliver a new Letter of Credit or certificate of renewal or extension to Landlord at least thirty (30) days prior to the expiration of the Letter of ~~Credit~~ Credit, without any action whatsoever on the part of Landlord; , (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #~~600; and~~ 500, (d) acceptable to Landlord in its reasonable discretion, and (e) fully assignable by Landlord by amendment thereto in ~~connection~~ accordance with ~~any number~~ customary letter of ~~transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer),~~ credit practice and shall permit partial draws~~. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION~~. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s 's reasonable discretion, and shall provide, among other things, in effect that: : (i1) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s 's (or Landlord’s 's then managing agent’s's) ~~written~~ statement that such (A) amount is due to Landlord ~~is entitled to make such drawing~~ under the terms and conditions of this Lease, it being understood that if Landlord or its managing agent be a limited liability company, corporation, partnership or other entity, then such statement shall be signed by a managing member (if a limited liability company), an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); , and (iiB) an event of default has occurred under this Lease and, all applicable notice and cure periods have elapsed; (2) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; ~~and~~ and (~~iii~~3) in the event of a transfer of Landlord’s 's interest in the ~~Building~~Premises, Landlord shall transfer the Letter of Credit, in whole or in part (or cause at Tenant's expense a substitute letter of credit to be delivered, as applicable), to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new ~~landlord~~Landlord. Tenant hereby acknowledges and agrees that Landlord is entering into this Lease in material reliance upon the ability of Landlord to draw upon the Letter of Credit upon the occurrence of any default on the part of Tenant hereunder which continues beyond any applicable notice and cure periods. Tenant further acknowledges and agrees that if Landlord cannot draw upon the Letter of Credit within the times and in the manner as anticipated by Landlord herein, Landlord shall suffer irreparable damage, harm and injury. From time to time during the Term of this Lease, including, but not limited to, the event whereby Tenant meets certain financial condition criterion as set forth in this Section 45, it is anticipated by the parties that the Letter of Credit will need to be amended, modified and, possibly reissued. Landlord and Tenant hereby covenant and agree to cooperate with one another to promptly effectuate any such amendments, modifications and new issuances, including without limitation, executing and submitting to the Issuer any and all documents or instruments as may be reasonably required to effectuate same. Each and every time during the Term of this Lease there is a change in the identity or address of the parties, including without limitation, any change in the identity of Landlord due to the sale, transfer or other conveyance by Landlord of its rights and interests in, to and under this Lease to any other party, person or entity, the Letter of Credit shall immediately be amended or reissued to reflect such changes and the parties hereby agree to execute and submit to the Issuer such further applications, documents and instruments as may be necessary to effectuate same. It is the intention of the parties that each and every successor and assign of both Landlord and Tenant be bound by and subject to the terms and provisions of this Section 45. Landlord may, at any time and without notice to Tenant and without first obtaining Tenant's consent thereto, assign all or any portion of its interest in and to the Letter of Credit to another party, person or entity, regardless of whether or not such assignment is separate from or as a part of the assignment by Landlord of its rights and interests in and to this Lease. If, as a result of any such application ~~or use by Landlord~~ of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than ~~the LC Amount~~Five Hundred Thousand Dollars ($500,000.00), Tenant ~~shall,~~ shall within ~~ten~~ five (105) business days ~~thereafter,~~ thereafter provide Landlord with an additional letter(s) of ~~credit,~~ credit in an amount equal to the deficiency (or a replacement letter of credit in the total amount of ~~the LC Amount~~Five Hundred Thousand Dollars ($500,000.00) and ~~any~~ each such additional (or replacement) letter of credit shall comply with all of the provisions of this ~~Article 27~~Section 45, and if ~~Xxxxxx~~ Tenant fails to ~~comply with~~ do so, notwithstanding anything to the ~~foregoing terms of this sentence~~contrary contained in Section 20 hereof, the same shall constitute an ~~uncurable~~ incurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of ~~Credit,~~ Credit or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the ~~Lease~~ Letter of Credit Expiration Date, Landlord will accept a renewal ~~letter of credit~~ thereof or substitute letter of credit (such renewal or substitute letter of credit to be in effect ~~and delivered to Landlord, as applicable,~~ not later than thirty (30) days prior to the expiration ~~of the Letter of Credit or amendment~~thereof), which shall be irrevocable and automatically renewable as above provided through the ~~Lease~~ Letter of Credit Expiration Date upon the same terms as the expiring ~~Letter~~ letter of ~~Credit~~ credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute ~~or amendment to~~ letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and ~~in accordance with the~~ terms set forth in this ~~Article 27~~Section 45, Landlord shall have the right to present ~~the~~ such Letter of Credit to the ~~issuing~~ bank in accordance with the terms of this ~~Article 27~~Section 45, and the entire sum evidenced thereby shall be paid to and held by Landlord as ~~cash (the “Cash Collateral”) to be held as~~ collateral for performance of all of Tenant’s 's obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash CollateralLease. If there shall occur a default under ~~the~~ this Lease ~~beyond all applicable notice and cure periods~~as set forth in Section 20 of this Lease, Landlord may, but without obligation to do so, draw upon the Letter of ~~Credit and/or utilize the Cash Collateral~~Credit, in part or in whole, ~~to the extent necessary~~ to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s 's default~~, as may be permitted by the express terms and conditions of this Lease~~. ~~Xxxxxx~~ Tenant agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “"draw” " by Landlord of any portion of the Letter of Credit, ~~[***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION.~~ regardless of whether any dispute exists between ~~Xxxxxx~~ Tenant and Landlord as to Landlord’s 's right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor ~~or Cash Collateral be:~~ be (ei) deemed to be or treated as a “"security deposit” " within the meaning of California Civil Code Section ~~1950.7;~~ 1950.7 (fas supplemented, amended, replaced and substituted from time to time), (ii) subject to the terms of such Section ~~1950.7; or~~ 1950.7 (gas supplemented, amended, replaced and substituted from time to time), or (iii) intended to serve as a “"security deposit” " within the meaning of such Section ~~1950~~1950.7 (as supplemented, amended, replaced and substituted from time to time). The parties hereto recite that, with respect to the Letter of Credit, (x) the Letter of Credit is not intended to serve as a security deposit and such Section 1950.7 (as supplemented, amended, replaced and substituted from time to time) and any and all other laws, rules and regulations applicable to security deposits in the commercial context ("Security Deposit Laws") shall have no applicability or relevancy to the Letter of Credit and (y) Tenant waives any and all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit Laws.

Appears in 1 contract

Samples: Lease Agreement (Exodus Communications Inc)

Letter of Credit. ~~Within~~ (a) At any time during any Collateral Period, Bank may require that Retailer deliver to Bank, within fifteen (15) days of Bank’s written request, either: (i) an Eligible Letter of Credit, or (ii) substitute collateral in the form of cash and securities (the “Substitute Collateral”) which shall be held in a deposit account subject to Bank’s control in accordance with the Substitute Collateral Documentation. Retailer may, at the time it receives Bank’s *CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FURNISHED SEPARATELY TO THE COMMISSION written request or at any time during any Collateral Period, elect in its discretion to provide to Bank pursuant to the terms of this Section 4.4 either the Eligible Letter of Credit or the Substitute Collateral. The amount of any Eligible Letter of Credit or Substitute Collateral requested by Bank (such requested amount being referred to herein as the “Collateral Amount”) shall not exceed (i) * in the event of a Xxxxx 0 Xxxxxxxxxx Xxxxx; or (ii) * in the event of a Xxxxx 0 Xxxxxxxxxx Xxxxx. Retailer acknowledges that the Collateral Amount may be increased from time to time pursuant to Section 6.21. (b) If, at any time, an event shall occur which would cause any Letter of Credit previously delivered to Bank to cease to be an Eligible Letter of Credit, within ten (10) days of the earlier of (i) the date on which Retailer first learns of the occurrence of such event; or (ii) the date on which Retailer first receives notice thereof from Bank, Retailer shall cause a substitute Eligible Letter of Credit to be issued and delivered to Bank in a face amount equal to the Collateral Amount or Substitute Collateral in accordance with the Substitute Collateral Documentation. On or before forty-five (45) days after the mutual execution and delivery of this Lease, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of ~~the~~ each Letter of Credit ~~without any action whatsoever on~~ provided to Bank, Retailer shall cause a substitute Eligible Letter of Credit to be issued and delivered to Bank in a face amount equal to the ~~part of Landlord;~~Collateral Amount or Substitute Collateral in accordance with the Substitute Collateral Documentation. (c) ~~subject~~ If, at any time, an event shall occur which would cause the Substitute Collateral Documentation to no longer be valid or in full force and effect, Bank shall have the ~~Uniform Customs~~ applicable rights and ~~Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and~~remedies set forth in the Substitute Collateral Documentation. (d) ~~fully assignable~~ Any amounts drawn under a Letter of Credit or transferred to Bank under the Substitute Collateral Documentation hereunder in excess of the Delivery Obligations then due to Bank shall be held by ~~Landlord~~ Bank in ~~connection with~~ a non-interest bearing account on Bank’s books (the “Collateral Account”) and shall secure Retailer’s full and prompt payment of the Delivery Obligations then or thereafter owing. If Retailer fails to pay any ~~number of transfers of Landlord~~Delivery Obligation when due, Bank may immediately, and without prior notice to Retailer, debit such unpaid amount from the amounts then remaining in the Collateral Account. Bank’s security interest in the Collateral Account shall be in addition to any right of setoff or recoupment that Bank may otherwise have under this ~~Lease (~~Agreement or Applicable Law. If Retailer purchases or arranges for the purchase of all of the Accounts and related Indebtedness from Bank in accordance with ~~Tenant bearing any fees, costs or expenses in connection with any such transfer)~~Section 10.1 hereof, and ~~permit partial draws~~if as of the date of such purchase, Retailer has paid all Delivery Obligations, Bank shall simultaneously pay to Retailer, an amount equal to the amount remaining in the Collateral Account on the date of such purchase. [If Retailer does not purchase or arrange for the purchase of all of the Accounts and related Indebtedness in accordance with Section 10.2 hereof, and if as of the Final Liquidation Date, Retailer has paid all Delivery Obligations, Bank shall pay to ***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND ~~FILED~~ FURNISHED SEPARATELY ~~WITH~~ TO THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in COMMISSION Retailer an amount equal to the ~~deficiency~~ amounts remaining in the Collateral Account on the Final Liquidation Date. (e) The obligations under this Section 4.4 shall apply at all times until the end of the Collateral Period, at which time, Bank shall (x) surrender any outstanding Letter of Credit or Substitute Collateral to Retailer, and (y) pay to Retailer an amount equal to the amount remaining in the Collateral Account, if any. The foregoing notwithstanding, if after Bank shall have surrendered any Letter of Credit or Substitute Collateral hereunder following the successful completion by Retailer of a Remediation Period, a Level 1 Collateral Event or a ~~replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit~~ Level 2 Collateral Event shall ~~comply with all of~~ again occur, the provisions of this ~~Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same~~ Section 4.4 shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950again apply.

Appears in 1 contract

Samples: Private Label Consumer Credit Card Program Agreement (Ethan Allen Interiors Inc)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution and delivery of this Lease, Tenant shall deliver to Landlord, as collateral~~ As security for the full and faithful performance of every covenant and condition of this Lease to be performed by Tenant, Tenant shall deliver to Landlord the Letter of Credit specified in Section 1. Landlord shall be entitled to draw upon the Letter of Credit upon demand, without prior notice to Tenant, at any time or from time to time on or after (1) the occurrence of any default by Tenant beyond any applicable notice and cure period with respect to any covenant or condition of ~~all of its obligations under~~ this Lease, ~~an irrevocable and unconditional negotiable letter~~ including but not limited to the payment of ~~credit~~ Rent, (2) if Tenant, or anyone in possession of the “Premises through Tenant, holds over after the expiration or earlier termination of this Lease without Landlord's prior written consent, (3) Landlord is given notice by the issuer of the Letter of Credit that it is terminating the Letter of Credit”), ~~substantially~~ (4) a confirming bank gives notice to Landlord that it will cease to act in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of Californiathat capacity, or ~~a National Banking Association, in~~ (5) the ~~initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen~~ Letter of Credit ~~from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a)~~ expires on a specified date by its terms and is not renewed or replaced at ~~sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is~~ least sixty (60) days ~~following the Termination Date~~ in advance of its expiration date or (~~“Letter of Credit Expiration Date”), subject~~ 6) to the ~~last paragraph of this Article 27~~extent permitted by law, ~~provide that~~ in the ~~expiration date of~~ event any bankruptcy, insolvency, reorganization or any other debtor creditor proceeding is instituted by or against Tenant. Landlord may apply the proceeds drawn on the Letter of Credit ~~shall~~ to the payment of any sum in default or any sum which Landlord may be ~~no earlier than~~ required to spend or incur by reason of Tenant's default or any other sum which Landlord may in its reasonable discretion deem necessary to spend or incur by reason of Tenant's default, in such order and priority as Landlord elects in its absolute discretion. If any of the proceeds drawn on the Letter of Credit ~~Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice~~ are not applied immediately to sums owing to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, ~~it being understood that if~~ Landlord ~~or its managing agent be~~ may retain any such excess proceeds as a ~~corporation~~cash Lease Security Deposit for application, ~~partnership or other entity~~at Landlord's election, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to ~~the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building,~~ future sums owing to Landlord ~~shall transfer the Letter of Credit~~under this Lease, in ~~whole or~~ such order and priority as Landlord elects in ~~part to the transferee and thereupon the Landlord~~ its absolute discretion. Tenant shall, ~~without any further agreement between the parties~~within fifteen (15) days after Landlord's demand, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, restore the amount of the Letter of Credit ~~shall be less than~~ drawn to the ~~LC Amount, Tenant shall, within ten~~ extent necessary so that the sum of any Security Deposit held by Landlord (10that was not applied to amounts payable under the Lease) ~~business days thereafter, provide Landlord with an additional letter(s)~~ and the Letter of ~~credit, in an amount~~ Credit is equal to the ~~deficiency (or a replacement letter of credit in the total~~ original amount of the ~~LC Amount) and any~~ Letter of Credit. If Tenant does not restore the Letter of Credit to its original amount within the required time period, such ~~additional (or replacement) letter~~ non-restoration shall be considered an Event of ~~credit~~ Default. If Tenant shall ~~comply~~ have fully complied with all of the ~~provisions~~ covenants and conditions of this ~~Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence~~Lease, the ~~same~~ Letter of Credit shall ~~constitute an uncurable default by Tenant.~~ be returned to Tenant ~~further covenants and warrants that it will neither assign nor encumber~~ or, if Landlord has drawn on the Letter of Credit, ~~or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting~~ the ~~generality~~ remaining proceeds of ~~the foregoing, if~~ the Letter of Credit ~~expires earlier than~~ which are in excess of sums due the ~~Lease Expiration Date~~Landlord shall be repaid to Tenant, ~~Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord~~without interest, ~~as applicable, not later than~~ within thirty (30) days ~~prior to~~ after the expiration or termination of the ~~Letter~~ Lease Term and delivery of ~~Credit or amendment), which shall be irrevocable and automatically renewable as above provided through~~ possession of the ~~Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable~~ Premises to Landlord in ~~its reasonable discretion~~accordance with this Lease. ~~However, if~~ In the ~~Letter~~ event of ~~Credit is not timely renewed~~ a sale or ~~a substitute~~ transfer of Landlord's estate or ~~amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit~~ interest in the ~~amount~~ Land and ~~in accordance with the terms set forth in this Article 27~~Building, Landlord shall have the right to ~~present~~ transfer the Letter of Credit to the vendee or the transferee, Tenant shall pay any transfer fees charged by the issuing bank ~~in accordance with the terms of this Article 27,~~ and ~~the entire sum evidenced thereby~~ Landlord shall thereafter be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default considered released by Tenant ~~under this Lease pending Tenant’s delivery to Landlord of~~ from all liability for the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds return of the Letter of Credit~~, either prior~~ . Tenant shall cooperate in effecting such transfer. In the event of Tenant's default beyond any applicable notice and cure period. Landlord's rights to ~~or following a “draw” by Landlord of any portion of~~ draw on the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease Credit shall be deemed to ~~render the Letter of Credit conditional~~ be in addition to ~~justify the issuer of the Letter of Credit~~ any and all other rights and remedies at law or in ~~failing~~ equity available to ~~honor a drawing upon such Letter of Credit in a timely manner.~~ Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950for Tenant's default under this Lease.

Appears in 1 contract

Samples: Office Lease Agreement (Wolf Resources, Inc.)

Letter of Credit. ~~Within forty-five (45) days after~~ At Tenant’s option, Tenant’s obligation to provide the ~~mutual~~ Security Deposit in accordance with this Article 4 may be satisfied by Tenant delivering to Landlord, simultaneously with the execution ~~and delivery~~ of this Lease, ~~Tenant~~ an Irrevocable Standby Letter of Credit (the “Original Letter of Credit”) which shall ~~deliver~~ be (1) in the form attached hereto as Exhibit E; (2) issued by a bank reasonably acceptable to ~~Landlord~~Landlord upon which presentation may be made in Boston, Massachusetts; (3) in the amount of Three Hundred Thirty-Six Thousand and 00/100 Dollars ($336,000.00); and (4) for a term of one (1) year, subject to the provisions of this Section 4.2. The Original Letter of Credit and any Replacement Letter(s) of Credit, Substitute Letter(s) of Credit and Additional Letter(s) of Credit (as ~~collateral for the full~~ such terms are defined hereinbelow) are referred to herein collectively and ~~faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (~~respectively as the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. .” The Letter of Credit shall ~~be:~~ be automatically renewable in accordance with terms of Exhibit E; provided, however, that Tenant shall be required to deliver to Landlord a new letter of credit satisfying the conditions set forth in this Section 4.2 (athe “Substitute Letter of Credit”) ~~at sight and irrevocable; (b) maintained in effect for the entire period from~~ on or before the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms term of the Letter of Credit ~~(and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things,~~ then in effect ~~that: (i) Landlord, or its then managing agent, shall have~~ if the ~~right to draw down an amount up to the face amount~~ issuer of ~~the~~ such Letter of Credit ~~upon~~ gives notice of its election not to renew such Letter of Credit for any additional period pursuant thereto. In the ~~presentation to~~ event that Tenant is in default, beyond the ~~issuing bank~~ expiration of ~~Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing~~ any applicable grace periods, of its obligations under this Lease, ~~it being understood that if Landlord or its managing agent be a corporation, partnership or other entity,~~ then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall ~~transfer~~ have the ~~Letter of Credit~~right, ~~in whole or in part~~ at any time after such event to ~~the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant~~ (1) draw down from ~~all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of~~ said Letter of Credit the amount necessary to ~~a new landlord~~cure such default; or (2) if such default cannot reasonably be cured by the expenditure of money, to exercise all rights and remedies Landlord may have on account of such default and to draw down from said Letter of Credit the amount which is necessary to satisfy Tenant’s liability on account thereof. ~~If, as a result~~ In the event of any ~~application or use~~ such draw by Landlord, Tenant shall, within fifteen (15) business days of written demand therefor, deliver to Landlord an additional Letter of ~~all or any part of~~ Credit satisfying the foregoing conditions (the “Additional Letter of Credit”), except that the amount of ~~the~~ such Additional Letter of Credit shall be ~~less than~~ the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of such draw. Failure by Tenant to timely deliver to Landlord such Additional Letter of Credit shall be a default not susceptible of cure, entitling Landlord to exercise any and all remedies hereunder on account thereof. In the ~~LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx~~ event Tenant fails timely to ~~comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the~~ deliver to Landlord a Substitute Letter of Credit. then Landlord shall have the right, or at any ~~part thereof and that neither Landlord nor its successors or assigns will be bound by~~ time after such event, without giving any ~~such assignment~~further notice to Tenant, ~~encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if~~ to draw down the Letter of Credit ~~expires earlier than~~ and to hold the proceeds thereof (the “Security Proceeds”) in accordance with this Section 4.2. If Landlord draws down the Letter of Credit pursuant to this Section, then: (1) Such draw and Landlord’s right to hold the Security Proceeds pursuant to this Section shall be Landlord’s sole remedy based on Tenant’s failure to timely deliver a Substitute Letter of Credit as required hereunder; and (2) Upon the expiration or prior termination of the Lease ~~Expiration Date~~Term, Landlord ~~will accept a renewal letter of credit or substitute letter of credit (~~shall return to Tenant any Security Proceeds then being held by Landlord, to the extent that any such ~~renewal or substitute letter of credit to be in effect and delivered~~ Security Proceeds exceed the amounts then due from Tenant to Landlord. To the extent that Landlord has not previously drawn upon any Letter of Credit or Security Proceeds (collectively, the “Collateral”) held by Landlord, and to the extent that Tenant is not otherwise in default of its obligations under this Lease as ~~applicable, not later than thirty (30) days prior to~~ of the expiration of the ~~Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the~~ Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27Term, Landlord shall ~~have~~ return such Collateral to Tenant at the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord expiration of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950Term.

Appears in 1 contract

Samples: Lease Agreement (One)

Letter of Credit. (a) Within ~~forty-five (45~~XXXX after Bank notifies Retailer that it is in breach of the Financial Covenant(s) ~~days after~~ contained in Appendix B and provided that Retailer has not remedied such breach during such XXXX period by providing evidence reasonably acceptable to Bank that the ~~mutual execution and delivery~~ applicable Financial Covenant(s) has been cured before the end of ~~this Lease~~such XXXX period, ~~Tenant~~ Retailer shall deliver to ~~Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease,~~ Bank an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Eligible Letter of Credit ~~from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained~~ in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit Amount. If, at any time, an event shall occur which would cause any Letter of Credit previously delivered to Bank to cease to be ~~less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with~~ an ~~additional letter(s)~~ Eligible Letter of ~~credit,~~ Credit or no longer be in an amount equal to or greater than the ~~deficiency~~ Letter of Credit Amount (including without limitation, as a result of increased aggregate Net Program Sales during the Term), within XXXX of the earlier of (i) the date on which Retailer first learns of the occurrence of such event; or (ii) the date on which Retailer first receives notice thereof from Bank, Retailer shall cause a substitute Eligible Letter of Credit to be issued and delivered to Bank in a face amount equal to or greater than the Letter of Credit Amount. On or before XXXX prior to the expiration of each Letter of Credit provided to Bank, Retailer shall cause a substitute Eligible Letter of Credit to be issued and delivered to Bank in a face amount equal to or greater than the Letter of Credit Amount. The obligations under this Section shall apply at all times until a day XXXX after the expiration of the Agreement at which time, Bank shall surrender any outstanding Letter of Credit to Retailer and return any balance in the Collateral Account to Retailer. [Portions of this Section have been omitted pursuant to a request for confidentiality under Rule 24b-2 of the Securities Exchange Act of 1934, as amended. The confidential portions of this Section that have been omitted are marked with “XXXX”. A copy of this Exhibit with all sections intact has been filed separately with the Securities and Exchange Commission.] (b) Any amounts drawn under a Letter of Credit hereunder in excess of the amounts due Bank hereunder shall be held by Bank in a non-interest bearing account on Bank’s books (the “Collateral Account”) and shall secure Retailer’s full and prompt payment of all further amounts due hereunder. If Retailer fails to pay any amounts hereunder when due or a ~~replacement letter~~ Letter of ~~credit~~ Credit Event shall occur, Bank may immediately, and without prior notice to Retailer, further draw on the Letter of Credit or, if applicable, debit any such unpaid amount from any amounts then remaining in the ~~total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27~~Collateral Account. In addition, ~~and~~ if ~~Xxxxxx~~ Retailer fails to ~~comply with~~ provide a substitute or replacement Eligible Letter of Credit as required by this Section 8 or if Retailer is in default under this Agreement or a Letter of Credit Event should occur, Bank may draw on the ~~foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber~~ full amount available under the Letter of Credit, apply any amounts received in such drawing against Retailer’ outstanding obligations hereunder, and credit the Collateral Account with the amount equal to EX10.1 any remaining balance. Bank’s security interest in the Collateral Account shall be in addition to any right of setoff or ~~any part thereof~~ recoupment that Bank may otherwise have under this Agreement or applicable law. (c) If, following Retailer’s delivery of an Eligible Letter of Credit to Bank in compliance with this Section 8, Retailer is able to obtain and ~~that neither Landlord nor its successors or assigns will be bound by any such assignment~~maintain compliance with the Financial Covenant(s) contained in Appendix B for a period of three (3) consecutive fiscal quarters of Retailer, ~~encumbrance~~and no Letter of Credit Event is ongoing, ~~attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if~~ then Bank shall return the Letter of Credit ~~expires earlier than~~ and/or any proceeds in the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than Collateral Account within thirty (30) days ~~prior to~~ after the ~~expiration~~ end of the applicable fiscal quarter. (d) Bank agrees to pay for the fees required by the issuing bank for any Letter of Credit ~~or amendment)~~requested by Bank hereunder; provided, ~~which~~ that the maximum amount payable by Bank in respect of each such fee shall ~~be irrevocable and automatically renewable as above provided through~~ not exceed XXXX of the ~~Lease Expiration Date upon the same terms as the expiring~~ applicable Letter of Credit or Amount. [Portions of this Section have been omitted pursuant to a request for confidentiality under Rule 24b-2 of the Securities Exchange Act of 1934, as amended. The confidential portions of this Section that have been omitted are marked with “XXXX”. A copy of this Exhibit with all sections intact has been filed separately with the Securities and Exchange Commission.] (e) So long as Bank approves of the Substitute Collateral Documentation which such ~~other terms as may~~ approval shall not be ~~acceptable to Landlord~~ unreasonably withheld, Retailer may, in ~~its reasonable discretion. However, if the~~ lieu of an eligible Letter of ~~Credit is not timely renewed or a~~ Credit, provide substitute ~~or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit~~ collateral in the ~~amount and~~ form of cash and/or securities (the “Substitute Collateral”). The Substitute Collateral shall be held in a deposit account subject to Bank’s control in accordance with the ~~terms set forth in~~ Substitute Collateral Documentation. The provisions of this ~~Article 27, Landlord shall have~~ Agreement applicable to the ~~right to present the~~ Retailer’s and Bank’s rights and obligations regarding a Letter of Credit shall equally apply to the ~~issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash~~ Substitute Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7;. (f) ~~subject to~~ For the purposes of this Agreement, the following terms ~~of such Section 1950.7; or (g) intended to serve as a “security deposit” within~~ shall have the ~~meaning of such Section 1950.~~following meanings:

Appears in 1 contract

Samples: Retailer Program Agreement (Select Comfort Corp)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days~~ Form of Letter of Credit. Not later than one (1) business day after ~~the mutual execution and delivery~~ receipt of Prime Landlord's written consent to this ~~Lease~~Sublease, ~~Tenant~~ Subtenant shall deliver to ~~Landlord~~Sublandlord an unconditional, ~~as collateral for the full~~ clean and ~~faithful performance by Tenant of all of its obligations under this Lease, an~~ irrevocable ~~and unconditional negotiable~~ letter of credit ~~(the “Letter of Credit”), substantially~~ in the ~~form attached as Exhibit G hereto and made a part hereof~~amount of $750,000.00, ~~and containing the terms required herein, payable in the State~~ which letter of ~~California, running in favor of Landlord,~~ credit shall be issued by a ~~solvent~~ money-center bank (a bank which accepts deposits, maintains accounts, has a local office which will negotiate a letter of credit, and whose deposits are insured by the FDIC) reasonably ~~approved by Landlord under~~ acceptable to Sublandlord, shall be for a term continuing through the ~~supervision~~ last day of the ~~Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***]~~ thirty (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire 30)- day period ~~from the date of execution of this Lease through the date which is sixty (60) days~~ following the ~~Termination~~ Expiration Date (~~“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide~~ or shall contain an "evergreen" provision which provides that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, it automatically is renewed on an annual basis unless the ~~issuing bank provides at least~~ issuer delivers thirty (30) ~~days~~ days' prior written notice to ~~Landlord~~ Sublandlord and Subtenant), shall permit partial draws, shall provide that draws thereunder will be honored upon receipt by issuer of ~~such non-renewal~~ a written statement signed by ~~certified mail, return receipt requested at the address set forth~~ Sublandlord or its authorized agent stating that Sublandlord is entitled to draw down on the letter of credit, shall be freely transferable and shall be in a form and content reasonably acceptable to Sublandlord. Such letter of ~~Letter~~ credit, together with any other renewal or replacement letters of ~~Credit attached~~ credit delivered or to be delivered by Subtenant hereunder shall be referred to collectively herein as ~~Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant~~ the "LC". The LC shall ~~deliver a new Letter of Credit to Landlord at least~~ provide for thirty (30) ~~days~~ days' prior written notice to Sublandlord of cancellation or material change thereof. In the ~~expiration~~ event of any non-extension of the ~~Letter~~ LC (if the term of ~~Credit without any action whatsoever on~~ the ~~part~~ LC is for a period shorter than the Term of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this ~~Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer~~Lease), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition Sublandlord shall be entitled to ~~the foregoing, the form and terms~~ present its written demand for payment of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the entire face amount of the ~~Letter of Credit upon~~ LC, and the ~~presentation to the issuing bank of Landlord’s~~ funds so obtained shall be held as a cash security deposit (~~or Landlord’s then managing agent’s~~"Cash Security Deposit") ~~written statement that Landlord is entitled to make such drawing~~ under this ~~Lease~~Sublease. Subtenant shall pay all expenses, ~~it being understood that if Landlord or its managing agent be~~ points and/or fees incurred by Subtenant in obtaining the LC. Additionally, upon a ~~corporation, partnership~~ proposed sale or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of ~~Landlord’s~~ Sublandlord's interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of CreditPremises, the ~~amount of the Letter of Credit shall be less than the LC Amount~~Prime Lease or this Sublease (including consolidations, ~~Tenant shall~~mergers or other entity changes), ~~within~~ Subtenant, at its sole cost and expense and upon ten (10) business ~~days thereafter~~days' notice, ~~provide Landlord~~ shall, concurrent with ~~an additional letter(s~~Sublandlord's delivery to Subtenant of the then outstanding LC, deliver to any such transferee, successor or assign a replacement LC on identical terms (except for the stated beneficiary) ~~of credit~~from the same issuer or another bank acceptable to Sublandlord, in ~~an amount equal to~~ Sublandlord's sole but reasonable discretion, naming the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms new Sublandlord as the ~~expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion~~beneficiary thereof. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the The LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be ~~entitled to~~ mortgaged, assigned or encumbered in any ~~interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods~~manner whatsoever by Subtenant without Sublandlord's prior written consent, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be ~~sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere~~ withheld in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950Sublandlord's sole discretion.

Appears in 1 contract

Samples: Sublease Agreement (3 Dimensional Pharmaceuticals Inc)

Letter of Credit. ~~Within forty-five (45) days after~~ Tenant, at any time during the ~~mutual execution and delivery of this Lease~~Term, ~~Tenant~~ shall have the right to deliver to ~~Landlord~~Landlord a “clean,” unconditional, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an~~ irrevocable and ~~unconditional negotiable~~ transferable letter of credit (the “Letter of Credit”~~), substantially~~ ) that (i) is in the amount of the Cash Security Deposit, (ii) is in a form ~~attached as Exhibit G hereto and made~~ that is reasonably satisfactory to Landlord, (iii) is issued for a ~~part hereof~~term of not less than one (1) year, ~~and containing~~ (iv) is issued for the ~~terms required herein, payable in the State of California, running in favor~~ account of Landlord, ~~issued by a solvent bank reasonably approved by~~ (v) automatically renews for periods of not less than one (1) year unless the issuer thereof otherwise advises Landlord ~~under the supervision of the Superintendent of Banks of the State of California,~~ on or ~~a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer~~ prior to the ~~execution~~ thirtieth (30th) day before the applicable expiration date, (vi) allows Landlord the right to draw thereon in part from time to time or in full, and (vii) is issued by, and drawn on, a bank that has a Standard & Poor’s rating of ~~this Lease. The Letter~~ at least “AA” (or, if Standard & Poor’s hereafter ceases the publication of ~~Credit shall be: (a) at sight and irrevocable; (b) maintained in effect~~ ratings for ~~the entire period from~~ banks, a rating of a reputable rating agency as reasonably designated by Landlord that most closely approximates a Standard & Poor’s rating of “AA” as of the date ~~of execution of this Lease through~~ hereof) and that either (I) has an office in the ~~date~~ city where the Building is located at which ~~is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of~~ Landlord can present the Letter of Credit ~~shall be no earlier than~~ for payment, or (II) has an office in the United States and allows Landlord to draw upon the Letter of Credit ~~Termination Date~~ without presenting a draft in person (such as, for example, by submitting a draft by fax or ~~provide for automatic renewal thereof at least through~~ overnight delivery service)(the aforesaid rating of the bank that issues the Letter of Credit ~~Expiration Date, unless~~ being referred to herein as the ~~issuing bank provides at least thirty (30) days prior written~~ “Bank Rating”). If Tenant gives notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days ~~prior~~ before the date that Tenant delivers to Landlord the ~~expiration~~ Letter of Credit, then Landlord shall deliver to Tenant, simultaneously with Tenant’s delivery of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, ~~in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have~~ the ~~right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s~~ Cash Security Deposit (or ~~Landlord’s~~ the portion thereof that then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank remains unapplied in accordance with the terms of this Article 2723). If Tenant does not give such notice to Landlord, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by then Landlord shall ~~be returned~~ deliver to ~~Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle~~ Tenant the Cash ~~Collateral with its general assets and~~ Security Deposit (or such portion thereof) on or prior to the thirtieth (30th) day after Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon gives the Letter of Credit ~~and/or utilize the Cash Collateral, in part or in whole,~~ to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this LeaseLandlord. ~~Xxxxxx agrees not to interfere in any way with payment to Landlord~~ As of the ~~proceeds of the Letter of Credit~~date hereof, ~~either prior to or following a “draw” by~~ Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord shall accept Silicon Valley Bank as ~~to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify~~ the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950Credit.

Appears in 1 contract

Samples: Lease (Riverbed Technology, Inc.)

Letter of Credit. Within ~~forty-five~~ thirty (4530) days ~~after~~ following the ~~mutual~~ full execution ~~and delivery~~ of this Lease, Tenant shall deliver to Landlord, as ~~collateral~~ protection for the full and faithful performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer (or that Landlord reasonably estimates it may suffer) as a result of any breach, default or failure to perform by Tenant under this Lease, an irrevocable and unconditional negotiable ~~letter~~ standby Letter of ~~credit~~ Credit (~~the~~ “Letter of Credit”), ~~substantially~~ in the form ~~attached~~ as ~~Exhibit G hereto and made a part hereof, and containing the terms required herein~~is reasonably acceptable to Landlord, payable at an office in the ~~State~~ San Francisco Bay Area, California or permit the draw of ~~California~~the letter of credit by overnight courier, running in favor of ~~Landlord~~Landlord and issued a solvent, ~~issued by~~ nationally recognized bank with a ~~solvent bank reasonably approved by Landlord~~ long term rating of BBB or higher, under the supervision of the Superintendent of Banks of the State of California, or a ~~National Banking Association~~national banking association (an “Acceptable Issuing Bank”), in the ~~initial~~ amount provided in Section 1.11 of ~~$[***]~~ this Lease (the “LC Letter of Credit Amount”). Tenant shall ~~provide~~ pay all expenses, points, or fees incurred by Tenant in obtaining the Letter of Credit and any replacement Letter of Credit. The bank issuing the Letter of Credit (the “Bank”) shall be subject to Landlord’s prior written approval, which approval shall not be withheld by Landlord ~~with~~ if the proposed Bank is an Acceptable Issuing Bank. As of the Lease Reference Date, subject to the remainder of this Section 8.3, Square 1 Bank is an Acceptable Issuing Bank. If an Acceptable Issuing Bank is declared insolvent or taken over by the Federal Deposit Insurance Corporation or any governmental agency for any reason or does not meet the standards to be approved an Acceptable Issuing Bank, Tenant shall deliver a ~~specimen~~ replacement Letter of Credit from another Bank approved by Landlord that meets the ~~approved issuer prior to~~ standards for an Acceptable Issuing Bank within the ~~execution~~ earlier of ~~this Lease~~(i) thirty (30) days after notice from Landlord that the Bank does not meet the standard for an Acceptable Issuing Bank, or (ii) the date the Bank is declared insolvent or taken over for any reason by the Federal Deposit Insurance Corporation or any other governmental agency. ~~The~~ In addition, the Letter of Credit shall beexpressly provide for the following: (a1) shall be “callable” at ~~sight~~ sight, irrevocable, and ~~irrevocable~~unconditional; (b2) shall be maintained in ~~effect~~ effect, whether through renewal or extension, for the ~~entire~~ period from the date of ~~execution of~~ this Lease ~~through~~ and continuing until the date ~~which is sixty~~ (~~60) days following~~ the ~~Termination Date (~~“Letter of Credit Expiration Date”) that is sixty (60) days after the expiration of the Term (as the Term may be extended). The Letter of Credit may be for one year period, ~~subject~~ provided the Letter of Credit is automatically extended for not less than a one year period unless the issuing Bank provides written notice to Landlord not less than sixty (60) days prior to the ~~last paragraph of this Article 27, provide that the~~ then expiration date of the Letter of Credit ~~shall be no earlier than~~ that the issuing Bank will not renew or extend the Letter of ~~Credit Termination Date or provide for automatic renewal thereof at least through the~~ Credit, in which case Tenant shall deliver to Landlord a replacement Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least not less than thirty (30) days prior to the scheduled expiration date of the then existing Letter of Credit held by Landlord without any action whatsoever on the part of Landlord; (c3) shall be fully assignable by Landlord, its successors, and assignees of its interest in the Leased Premises; Divco\Gateway/Tobira Lease (4) shall permit partial draws and multiple presentations and drawings; and (5) shall be otherwise subject to the Uniform Customs and Practices for Documentary ~~Credits (1993-Rev)~~ Credits, International Chamber of Commerce Publication ~~#600; and~~ No. 600 (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnershipUCP600), or ~~any authorized party~~ the International Standby Practices-ISP 98, International Chamber of Commerce Publication No. 590 (~~if another entity~~1998); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Office Lease (Tobira Therapeutics, Inc.)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution and delivery of~~ As a material inducement to Landlord to ---------------- enter into this Lease, Tenant shall deliver to ~~Landlord, as collateral for~~ Landlord at the ~~full~~ time that Tenant executes and ~~faithful performance by Tenant of all of its obligations under~~ delivers this Lease, an that certain unconditional irrevocable ~~and unconditional negotiable~~ letter of credit in the original amount of $500,000 (the “"Letter of Credit”"), ~~substantially~~ a copy of which is attached here to as Exhibit E. The Letter of Credit (or any --------- replacement thereof as described below) shall: (a) be in the form ~~attached as Exhibit G hereto~~ and ~~made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably~~ substance approved by Landlord; (b) name Landlord or such person or entity which Landlord may from time to time designate, as the beneficiary under the ~~supervision~~ Letter of Credit; (c) specifically allow Landlord to draw upon it at any time and from time to time by delivering to the issuer of the ~~Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen~~ Letter of Credit ~~from the approved~~ written notice certified as being true by Landlord certifying to such issuer ~~prior~~ that Landlord is entitled to draw thereunder pursuant to the ~~execution~~ terms of this Lease; (d) expire no earlier than ninety (90) days after the end of the Term of the Lease and (e) be drawn under an FDIC-insured financial institution located in the central business district of the City of Chicago approved by Landlord. The Letter of Credit shall ~~be:~~ have an expiration date no earlier than one (a1) ~~at sight and irrevocable; (b) maintained in effect for the entire period from~~ year after the date of ~~execution of this Lease through~~ issue, and Tenant agrees to cause the ~~date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date~~ issuer of the Letter of Credit ~~shall be no earlier than~~ to renew the Letter of ~~Credit Termination Date or provide for automatic renewal thereof~~ Credit, from time to time until such time as it has been released by Landlord as required herein, at least ~~through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty~~ ninety (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (3090) days prior to the expiration of the Letter of Credit ~~without any action whatsoever on~~ upon the ~~part~~ same terms and conditions. If the Premises are conveyed by Landlord, Tenant, upon written request, shall amend the Letter of ~~Landlord; (c) subject~~ Credit to change the beneficiary thereunder to the ~~Uniform Customs~~ successor landlord. In the event: (i) Tenant defaults in the performance of its obligations under this Lease, and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest such default is not cured within the applicable notice period provided in this Lease (provided, however that, for purposes of this Section 17.1, Tenant shall not have the right to receive any notice with respect to a monetary default more than twice during the Term); or (ii) Tenant ~~bearing any fees~~fails to deliver, ~~costs~~ renew or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of replace the Letter of Credit (within the applicable time limits and ~~the bank issuing the same) shall be acceptable to Landlord~~as otherwise provided herein, then, in ~~Landlord’s reasonable discretion~~any such event, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its ~~managing agent be a corporation, partnership~~ successor or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Creditassign, in ~~whole~~ addition to all rights and remedies which Landlord or ~~in part to the transferee and thereupon the Landlord shall~~its successor or assign, ~~without any further agreement between the parties~~may have under this Lease or at law, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit ~~to the issuing bank in accordance with the terms of this Article 27,~~ for payment and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify require the issuer of the Letter of Credit ~~in failing~~ to ~~honor a drawing upon such~~ make payment to Landlord or its successor or assign the entire amount represented by the Letter of ~~Credit in a timely manner~~Credit. Any proceeds obtained by Landlord ~~and Tenant acknowledge and agree that in no event or circumstance shall~~ by presenting the Letter of Credit ~~or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to~~ shall be ~~or treated~~ used and applied by Landlord as ~~a “security deposit” within~~ the ~~meaning of California Civil Code~~ Security Deposit as provided in Section ~~1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~5.6.

Appears in 1 contract

Samples: Lease Agreement (Exodus Communications Inc)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after the mutual execution and delivery of this Lease,~~ Tenant shall ~~deliver to Landlord~~cause an irrevocable, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable~~ transferable letter of ~~credit (the “Letter of Credit”)~~credit, substantially in the form of Exhibit F attached ~~as Exhibit G~~ hereto (the "Letter of Credit"), to be issued and ~~made a part hereof, and containing the terms required herein, payable in the State of California, running~~ outstanding in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at ~~sight and irrevocable; (b) maintained in effect for the entire period~~ all times from the date ~~of execution of this Lease through the date which is~~ hereof until sixty (60) days ~~following~~ after the ~~Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph~~ expiration or earlier termination of this ~~Article 27, provide that the expiration date of the~~ Lease. Each Letter of Credit shall (i) be ~~no earlier than~~ issued by a domestic United States financial institution with a credit rating of at least A1 by Moodx'x Xxxestors Service, Inc. (or upon modification or replacement of such financial rating system, its then equivalent rating) (the "Required Credit Rating") and otherwise acceptable to Landlord (the "Letter of Credit ~~Termination Date or provide for automatic renewal thereof~~ Provider"), (ii) have an expiration date of not earlier than one calendar year following the date of issue, (iii) at ~~least through~~ all times be in an available amount (the "Required Letter of Credit ~~Expiration Date~~Amount") of not less than nine (9) months of Base Rent, which as of the date hereof is $240,131.25, and (iv) provide that during the Term it shall be automatically extended for an additional period of one year from the scheduled expiration date unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to ~~the expiration of~~ such date Landlord receives from the Letter of Credit ~~without any action whatsoever on the part~~ Provider thereof notice in writing that such Letter of ~~Landlord; (c) subject~~ Credit Provider elects not to ~~the Uniform Customs and Practices~~ renew such Letter of Credit for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such ~~transfer), and permit partial draws~~additional period. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of If the Letter of Credit ~~(and the bank issuing the same) shall be acceptable~~ Provider elects not to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the renew such Letter of Credit ~~upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make~~ for such ~~drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity~~additional period, then ~~such statement~~ Tenant shall ~~be signed by an officer (if~~ cause a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said new Letter of Credit to be issued in replacement thereof from a ~~new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the~~ Letter of Credit ~~shall be less than the LC Amount, Tenant shall, within ten~~ Provider at least fifteen (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (3015) days prior to the expiration date of the existing Letter of Credit; provided, however, that Tenant shall not permit an existing Letter of Credit to expire until such new Letter of Credit has been issued. (b) If, while a Letter of Credit is required to be outstanding hereunder, the financial rating of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if Provider providing the Letter of Credit is ~~not timely renewed or~~ less than the Required Credit Rating, then Landlord may require Tenant to provide, and Tenant shall provide, a ~~substitute or amendment to letter~~ replacement Letter of Credit issued by a Letter of Credit Provider with a credit ~~is not timely received~~rating that meets the Required Credit Rating within thirty (30) days of demand therefor by Landlord, ~~or if~~ which replacement Letter of Credit shall comply with the terms of Section 1.04(a) hereof, provided that nothing in this Section 1.04(b) shall affect the obligations of Tenant ~~fails to maintain~~ under Section 1.04(a) hereof. Promptly following receipt of such replacement Letter of Credit, Landlord shall surrender the Letter of Credit ~~in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right~~ being replaced to ~~present~~ the Letter of Credit to Provider thereof. (c) Notwithstanding the ~~issuing bank in accordance with~~ foregoing, on the ~~terms~~ one year anniversary of ~~this Article 27~~the Commencement Date and each anniversary thereafter, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may ~~suffer as a result of any default~~ (by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned providing written notice thereof to Tenant~~. Landlord shall have~~ ) reduce the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Required Letter of Credit ~~and/or utilize~~ Amount by an amount equal to two (2) months of Base Rent if (i) Tenant shall have provided Landlord with Tenant's audited financial statements for the ~~Cash Collateral~~prior year (and any other financial statements required under Section 20.18 hereof), (ii) Landlord decides, in ~~part or in whole~~its sole discretion, to that the ~~extent necessary to cure any default~~ financial condition of Tenant ~~and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by~~ merits that the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Required Letter of Credit ~~conditional to justify~~ Amount be so reduced and (iii) no Event of Default shall have occurred at any time during the ~~issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree~~ Term; provided, however, that in no event ~~or circumstance~~ shall the Required Letter of Credit ~~or any renewal thereof or substitute therefor or Cash Collateral be:~~ Amount be less than an amount equal to three (e3) ~~deemed to be or treated as a “security deposit” within the meaning~~ months of ~~California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~Base Rent.

Appears in 1 contract

Samples: Lease Agreement (Genta Incorporated /De/)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution and delivery of this Lease, Tenant shall deliver to Landlord, as collateral~~ As security for the ~~full and faithful~~ performance by Tenant of ~~all~~ Tenant’s obligations hereunder, Tenant shall cause to be delivered to Landlord concurrently with the execution of ~~its obligations under~~ this ~~Lease~~Lease by Tenant, an original irrevocable ~~and unconditional negotiable~~ standby letter of credit (the “Letter of Credit”~~), substantially~~ ) in the ~~form attached~~ amount specified in Article 1 above, naming Landlord as ~~Exhibit G hereto and made~~ beneficiary, which Landlord may draw upon to cure any default under this Lease or to compensate Landlord for any damage Landlord incurs as a ~~part hereof, and containing~~ result of Tenant’s failure to perform any of its obligations hereunder. Any such draw on the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit ~~from the approved issuer prior~~ shall not constitute a waiver of any other rights of Landlord with respect to ~~the execution of this Lease~~such default or failure to perform. The Letter of Credit shall ~~be: (a) at sight~~ be issued by a major commercial bank reasonably acceptable to Landlord, with a San Francisco, California, or New York, New York, service and ~~irrevocable; (b) maintained in effect~~ claim point for the ~~entire~~ Letter of Credit, have an expiration date not earlier than the sixtieth (60th) day after the Expiration Date (or, in the alternative, have a term of not less than one (1) year and be automatically renewable for an additional one (1) year period ~~from~~ unless notice of non-renewal is given by the ~~date of execution of this Lease through the date which is~~ issuer to Landlord not later than sixty (60) days ~~following~~ prior to the ~~Termination Date (“~~expiration thereof) and shall provide that Landlord may make partial and multiple draws thereunder, up to the face amount thereof. In addition, the Letter of Credit ~~Expiration Date”)~~shall provide that, ~~subject to~~ in the ~~last paragraph~~ event of Landlord’s assignment or other transfer of its interest in this ~~Article 27~~Lease, ~~provide that the expiration date of~~ the Letter of Credit shall be freely transferable by Landlord to the assignee or transferee of such interest and the bank shall confirm the same to Landlord and such assignee or transferee provided that Landlord pays the issuing bank’s reasonable standard fee for any such transfer. The Letter of Credit shall provide for payment to Landlord upon the issuer’s receipt of a sight draft from Landlord together with Landlord’s certificate certifying that Landlord is entitled to such payment pursuant to the provisions of this Lease, and with no ~~earlier than~~ other conditions, shall be in the form attached hereto as Exhibit D, or such other form as Landlord shall approve, and otherwise be in form and content satisfactory to Landlord. If the Letter of Credit ~~Termination Date or provide for automatic renewal thereof at least through~~ has an expiration date earlier than the ~~Letter of Credit~~ Expiration Date, ~~unless~~ then throughout the ~~issuing bank provides at least thirty~~ term hereof (30including any renewal or extension of the term) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall ~~deliver a new~~ provide evidence of renewal of the Letter of Credit to Landlord at least thirty (30) days prior to the ~~expiration of~~ date the Letter of Credit ~~without any action whatsoever~~ expires. If Landlord draws on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up pursuant to the ~~face amount of~~ terms hereof, Tenant shall immediately replenish the Letter of Credit ~~upon the presentation~~ or provide Landlord with an additional letter of credit conforming to the ~~issuing bank~~ requirement of ~~Landlord’s (or Landlord’s then managing agent’s) written statement~~ this paragraph so that the amount available to Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) from the Letter of ~~Credit will be honored by~~ Credit(s) provided hereunder is the ~~issuing bank without inquiry as~~ amount specified in Article 1 above. Tenant’s failure to ~~the accuracy thereof and regardless~~ deliver any replacement, additional or extension of ~~whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer~~ the Letter of Credit, or evidence of renewal of the Letter of Credit, within the time specified under this Lease shall entitle Landlord to draw upon the Letter of Credit then in ~~whole or~~ effect and, at Landlord’s election, constitute a default under this Lease. If Landlord liquidates the Letter of Credit as provided in ~~part to~~ the ~~transferee and thereupon~~ preceding sentence, Landlord shall hold the ~~Landlord shall, without any further agreement between~~ funds received from the ~~parties, be released by Tenant from all liability therefor~~Letter of Credit as security for Tenant’s performance under this Lease, and ~~it is agreed that the provisions hereof~~ Landlord shall ~~apply~~ not be required to ~~every transfer~~ segregate such security deposit from its other funds and no interest shall accrue or ~~assignment~~ be payable to Tenant with respect thereto. No holder of a Mortgage, nor any purchaser at any judicial or private foreclosure sale of the ~~whole~~ Project or any portion thereof, shall be responsible to Tenant for such security deposit unless and only to the extent such holder or purchaser shall have actually received the same. If Tenant is not in default at the expiration or termination of ~~said~~ this Lease, Landlord shall return to Tenant the Letter of Credit ~~to a new landlord. If~~or the balance of the security deposit then held by Landlord, as ~~a result of~~ applicable; provided, however, that in no event shall any ~~application or use~~ such return be construed as an admission by Landlord that Tenant has performed all of its covenants and obligations hereunder. Tenant hereby unconditionally and irrevocably waives the benefits and protections of California Civil Code Section 1950.7, and, without limitation of the scope of such waiver, acknowledges that Landlord may use all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or ~~amendment), which shall be irrevocable and automatically renewable as above provided through~~ the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or proceeds thereof to compensate Landlord for ~~any and all~~ damages ~~of any kind or nature sustained or which may be sustained by Landlord~~ resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term termination of this Lease ~~shall be deemed to render~~ and the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: tenancy created hereunder (~~e) deemed to be or treated as a “security deposit” within the meaning of~~ including, without limitation, damages recoverable under California Civil Code Section ~~1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~1951.2).

Appears in 1 contract

Samples: Lease (Hortonworks, Inc.)

Letter of Credit. ~~Within forty-five~~ (45i) ~~days after the mutual execution and delivery of this Lease,~~ Tenant shall ~~deliver~~ have the right to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially deposit said Security Deposit in the form ~~attached as Exhibit G hereto~~ of a renewable, irrevocable, unconditional and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen transferable Letter of Credit from an Issuing Bank in substantially the ~~approved issuer prior to the execution of this Lease. The~~ form attached hereto as Exhibit E. Tenant shall continuously renew such Letter of Credit ~~shall be: (a)~~ at ~~sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is~~ least sixty (60) days ~~following the Termination Date (“Letter of Credit Expiration Date”), subject~~ prior to ~~the last paragraph of this Article 27, provide that the~~ each expiration date ~~of the Letter of Credit~~ thereof and failure to do so shall constitute a default under this Lease and Landlord shall thereupon immediately be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice entitled to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the draw upon said Letter of Credit without ~~any action whatsoever on the part of Landlord;~~Notice to Tenant. (cii) ~~subject to~~ In the ~~Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with~~ event that at any ~~number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees~~time during the Term, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable ~~discretion~~opinion, ~~and shall provide, among other things, in effect that:~~ believes (i) ~~Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount~~ that any rating of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit Issuing Bank shall be less than the ~~LC Amount~~rating specified for an Issuing Bank in this Lease; or (ii) that circumstances have occurred indicating that the Issuing Bank may be incapable of, unable to, or prohibited from honoring the then existing Letter of Credit (hereinafter referred to as the “Existing L/C”) in accordance with the terms thereof, then, upon the happening of either of the foregoing, Landlord may send Notice to Tenant ~~shall,~~ to replace the Existing L/C within ten (10) business days ~~thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount~~ of the ~~LC Amount) and any such additional (or replacement) letter~~ receipt of ~~credit shall comply~~ Landlord’s Notice with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a ~~renewal letter of credit or substitute~~ new letter of credit (~~such renewal or substitute letter of credit~~ hereinafter referred to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the ~~expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if~~ “Replacement L/C”) from an Issuing Bank meeting the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth qualifications for an Issuing Bank in this ~~Article 27~~Lease. Upon receipt of a Replacement L/C meeting said qualifications, Landlord shall ~~have~~ forthwith return the ~~right~~ Existing L/C to ~~present~~ Tenant. In the ~~Letter of Credit to~~ event that a Replacement L/C meeting said qualifications is not received by Landlord within the ~~issuing bank~~ time specified or if Landlord reasonably believes an emergency exists, then in ~~accordance with~~ either event, the ~~terms of this Article 27,~~ Existing L/C may be presented for payment by Landlord and the ~~entire sum evidenced thereby~~ proceeds thereof shall be ~~paid to and~~ held by Landlord as a cash ~~(the “Cash Collateral”)~~ Security Deposit in accordance with Section 23.1 subject, however, to ~~be held as collateral for performance of all of~~ Tenant’s ~~obligations under this Lease and for all losses and damages Landlord may suffer as~~ right, at any time thereafter prior to a ~~result of any default by Tenant under this Lease pending~~ Tenant’s ~~delivery~~ default hereunder, to ~~Landlord of the required replacement letter of credit in the LC Amount and otherwise complying~~ replace such proceeds with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the new Letter of Credit ~~and/or utilize~~ meeting the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions requirements of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section ~~1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~23.2.

Appears in 1 contract

Samples: Office Lease (Fitbit Inc)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after the mutual~~ Concurrently with its execution ~~and delivery~~ of this ~~Lease~~Sublease, ~~Tenant~~ Subtenant shall deliver to ~~Landlord~~Sublandlord, as ~~collateral~~ security for ~~the full and faithful performance by Tenant of all of its obligations under~~ this ~~Lease~~Sublease, an irrevocable ~~and unconditional negotiable~~ letter of credit (the “Original Letter of Credit”~~), substantially~~ ) in the ~~form attached as Exhibit G hereto and made a part hereof, and containing~~ amount of $ _________________ (the ~~terms required herein, payable in the State of California, running in favor of Landlord,~~ “Required Security Deposit Amount”) issued by a ~~solvent~~ bank ~~reasonably approved by Landlord under the supervision~~ which is a member of the ~~Superintendent~~ Federal Reserve System satisfactory to Sublandlord, which shall (i) be transferable, (ii) be payable to Sublandlord in partial or full draws upon presentation solely of ~~Banks~~ a draft purportedly signed by an officer of Sublandlord (which presentation may be made at the ~~State~~ issuer’s counter or by courier or by overnight mail at the address specified in such letter of ~~California~~credit), ~~or a National Banking Association, in the~~ (iii) have an initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period expiry date not less than one year from the date of ~~execution~~ issue and contain an "evergreen" provision to the effect that such letter of ~~this Lease through~~ credit will be automatically extended for successive one-year periods unless at least 60 days prior to the expiration thereof, the issuer gives written notice to Sublandlord that such letter of credit will not be extended for the next annual period, (iv) have a final expiry date which shall be not earlier than the day which is ~~sixty~~ 60 days after the Sublease Expiration Date, and (60v) ~~days following~~ be in form and substance otherwise satisfactory to Sublandlord. The Original Letter of Credit and any Replacement Letter of Credit (as hereinafter defined) delivered to Sublandlord as hereinafter provided is herein referred to as the ~~Termination Date (~~“Letter of ~~Credit Expiration Date~~Credit”). Any and all fees or costs charged by the issuer in connection with the issuance, ~~subject to the last paragraph of this Article 27, provide that the expiration date~~ maintenance or transfer of the Letter of Credit shall be ~~no earlier than~~ paid by Subtenant. (b) If Subtenant defaults in the ~~Letter~~ observance or performance of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration any of the ~~Letter~~ terms and conditions of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this ~~Lease (with Tenant bearing any fees~~Sublease, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to Sublandlord may draw ~~down an amount up to the face amount of the Letter of Credit~~ upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, ~~in whole~~ and may use or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply ~~to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of~~ all or any part of the ~~Letter~~ proceeds of ~~Credit~~such drawing and any cash security deposit then held by Sublandlord for the payment of any rent not paid when due or for the payment of any other amounts due Sublandlord by reason of such default, ~~the amount~~ including any costs of Sublandlord’s observing or performing such terms or conditions on Subtenant’s behalf, any deficiencies in reletting, and any damages to which Sublandlord may be entitled. Any proceeds of the Letter of Credit which are not used or applied as hereinabove provided shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by ~~Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer~~ Sublandlord as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a cash security deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateraluntil so used or applied. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of ~~Credit~~Credit is drawn upon, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as Subtenant shall, within five (5) days after written demand from Sublandlord, deliver to ~~Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer~~ Sublandlord either an amendment of the Letter of Credit ~~in failing to honor a drawing upon~~ signed by the issuer, reinstating the undrawn amount of such Letter of Credit by an amount equal to such drawing up to the Required Security Deposit Amount (an “Amendment”), or shall deliver to Sublandlord, in replacement of such Letter of Credit a ~~timely manner~~Replacement Letter of Credit (as hereinafter defined), in which latter event, the Letter of Credit so replaced shall be returned to Subtenant and, provided there is then no outstanding default by Subtenant, any cash security held by Sublandlord shall be paid over to Subtenant. ~~Landlord and Tenant acknowledge and agree that~~ A “Replacement Letter of Credit” shall mean a letter of credit in ~~no event or circumstance shall~~ the Required Security Deposit Amount in the same form as the Original Letter of Credit issued by a bank which is a member of the Federal Reserve System satisfactory to Sublandlord. Subtenant’s failure to increase the Letter of Credit or ~~any renewal thereof or substitute therefor or Cash Collateral be:~~ to deliver a Replacement Letter of Credit to Sublandlord within such five (e) 5)-day period shall be deemed to be a default under this Sublease entitling Sublandlord to exercise all of its rights under this Sublease without requiring Sublandlord to provide any further notice or ~~treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject~~ grace period to ~~the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~Subtenant.

Appears in 1 contract

Samples: Sublease Agreement

Letter of Credit. ~~Within forty-five (45) days after the mutual~~ Concurrently with Tenant's execution and delivery of this ~~Lease~~Third Addendum, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under the Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease, an irrevocable and unconditional negotiable letter of credit (the ~~“Letter of Credit”~~"LETTER OF CREDIT"), ~~substantially~~ in the form ~~attached as Exhibit G hereto and made a part hereof,~~ and containing the terms required herein, payable in the ~~State~~ County of Los Angeles, California, running in favor of Landlord, issued by a solvent bank ~~reasonably approved by Landlord~~ under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the ~~initial~~ amount of Sixty Thousand Dollars ($~~[***]~~ 60,000.00) (“"LC ~~Amount”~~AMOUNT")~~. Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease~~. The Letter of Credit shall ~~be:~~ be (ai) at sight and irrevocable; , (bii) subject to the terms of this Section 6, maintained in ~~effect~~ effect, whether through replacement, renewal or extension, for the entire period from the date of execution of this Third Addendum to Lease through the ~~date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the~~ scheduled expiration ~~date~~ of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty Extended Term (30"LEASE EXPIRATION DATE") days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, and Tenant shall deliver a new Letter of Credit or certificate of renewal or extension to Landlord at least ~~thirty~~ fifteen (30Ii) days prior to the expiration of the Letter of ~~Credit~~ Credit, without any action whatsoever on the part of Landlord; , (ciii) subject to the Uniform Customs and ----------- ----------- ------- ------- Initial Initial Initial Initial THIRD ADDENDUM TO OFFICE LEASE (CONTINUED) Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #~~600; and~~ 500, and (div) fully assignable by Landlord in connection with ~~any number of transfers~~ a transfer of Landlord’s 's interest in this Lease ~~(with Tenant bearing any fees, costs or expenses in connection with any such transfer),~~ and permit partial draws~~. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION~~. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s 's reasonable discretion, and shall provide, among other things, in effect that: : (iA) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s 's (or Landlord’s 's then managing agent’s's) written statement that such amount is due to Landlord ~~is entitled to make such drawing~~ under the terms and conditions of this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); ; (iiB) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; ~~and~~ and (~~iii~~C) in the event of a transfer of Landlord’s 's interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part (or cause a substitute letter of credit to be delivered, as applicable) to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of ~~Credit~~Credit (or any "Cash Collateral" as that term is defined below), the amount of the Letter of Credit and Cash Collateral shall collectively be less than the LC Amount, Tenant shall, within ten (10) ~~business~~ days thereafter, provide Landlord with an either (i) cash (the "CASH COLLATERAL") to be held and applied by Landlord as collateral in the same manner as if Landlord held such amount as part of the Letter of Credit, or (ii) additional letter(s) of ~~credit,~~ credit in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this ~~Article 27~~Section 6, and if ~~Xxxxxx~~ Tenant fails to comply with the ~~foregoing terms of this sentence~~foregoing, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of ~~Credit~~Credit or Cash Collateral, as the case may be, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept Cash Collateral, a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit or Cash Collateral to be in effect and delivered to Landlord, as applicable, not later than ~~thirty~~ fifteen (3015) days prior to the expiration of the Letter of ~~Credit or amendment~~Credit), which with respect to any letter of credit shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if Cash Collateral is not timely delivered or the Letter of Credit is not timely renewed or a substitute ~~or amendment to~~ letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit and/or the Cash Collateral in the amount and in accordance with the terms set forth in this ~~Article 27~~Section 6, Landlord shall have the right to present the Letter of Credit to the ~~issuing bank~~ Bank in a accordance with the terms of this ~~Article 27~~Section 6, and the entire sum evidenced thereby shall be paid to and held by Landlord as ~~cash (the “~~Cash ~~Collateral”) to be held as collateral~~ Collateral for performance of all of Tenant’s 's obligations under ~~this~~ the Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash CollateralLease. If there shall occur a default under the Lease ~~beyond all applicable notice and cure periods~~as set forth in Section 20 of the Lease, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, ~~to the extent necessary~~ to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s 's default~~, as may be permitted by the express terms and conditions of this Lease~~. ~~Xxxxxx~~ Tenant agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “"draw” " by Landlord of any portion of the Letter of Credit, ~~[***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION.~~ regardless of whether any dispute exists between ~~Xxxxxx~~ Tenant and Landlord as to Landlord’s 's right to draw from the Letter of Credit. No condition or term of ~~this~~ the Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Office Lease (Grand Havana Enterprises Inc)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution and delivery of this Lease, Tenant shall deliver~~ If Allstate elects to ~~Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “~~provide a Letter of Credit”), ~~substantially~~ the following provisions shall apply: (a) Allstate shall apply for and provide to Allstate Life of New York a clean, unconditional, irrevocable Letter of Credit in the ~~form attached as Exhibit G hereto~~ Aggregate Required Amount and ~~made a part hereof, and containing the terms required herein, payable in the State of California, running~~ in favor of ~~Landlord~~Allstate Life of New York as beneficiary, ~~issued~~ and any successor by ~~a solvent bank reasonably approved by Landlord under the supervision~~ operation of ~~the Superintendent~~ law of ~~Banks~~ Allstate Life of ~~the State of California~~New York including, without limitation, any liquidator, rehabilitator, receiver or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Leaseconservator. The Letter of Credit shall ~~be:~~ (ai) be issued by a qualified U.S. bank authorized to issue letters of credit under 11 NY CRR 79.1 and shall be presentable and payable at ~~sight and irrevocable; (b) maintained in effect for~~ the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date offices of the ~~Letter~~ issuing bank, (ii) be issued for a term of ~~Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof~~ at least ~~through the Letter of Credit Expiration Date~~one (1) year, ~~unless the issuing bank~~ with an issue and expiration date, (iii) contain an “evergreen clause” that provides at least thirty (30) ~~days prior~~ days’ written notice to ~~Landlord~~ Allstate Life of New York prior to the expiration date for nonrenewal, (iv) contain a statement that it is not subject to any agreement, condition or qualification outside of the Letter of Credit, (v) contain a statement that the obligations of the issuing bank are the individual obligations of such ~~non-renewal~~ bank and not contingent upon reimbursement with respect thereto, (vi) be governed by ~~certified mail~~the laws of the state of New York and the 1993 Revision of the Uniform Customs and Practice for Documentary Credits of the International Chamber of Commerce (Publication 500) and that, ~~return receipt requested at~~ in the ~~address set forth on~~ event of any conflict, the laws of the state of New York will control and (vii) in all other respects shall be in a form that complies with all applicable requirements of 11 NYCRR 79.2. If the issuing bank shall cease to meet such requirements during the term of the Letter of Credit, Allstate shall replace such Letter of Credit ~~attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver~~ with a ~~new Letter~~ complying one upon the earlier of ~~Credit to Landlord at least thirty (30) days prior to~~ the stated expiration of the Letter of Credit ~~without any action whatsoever~~ or the date fifteen (15) days from the date on ~~the part of Landlord;~~which such bank shall cease to meet such requirements. (cb) ~~subject to~~ Within thirty (30) days of Allstate’s receipt of the ~~Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and~~Quarterly Reports: (di) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to if the ~~foregoing,~~ Aggregate Required Amount exceeds the ~~form and terms~~ then existing balance of the Letter of Credit ~~(and~~ available as of the ~~bank issuing the same)~~ Quarterly Report, Allstate shall ~~be acceptable~~ secure delivery to ~~Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down~~ Allstate Life of New York an ~~amount up to the face amount~~ amendment of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, increasing the amount of the Letter of Credit ~~shall be~~ available by the amount of such difference, or (ii) if the Aggregate Required Amount is less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration existing balance of the Letter of Credit ~~or amendment)~~available as of the Quarterly Report, ~~which~~ Allstate Life of New York shall ~~be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or~~ release such ~~other terms as may be acceptable~~ excess credit by agreeing to ~~Landlord in its reasonable discretion. However, if~~ an amendment to the Letter of Credit is reducing the amount of the Letter of Credit available by the amount of such excess credit. (c) Allstate and Allstate Life of New York agree that the Letter of Credit provided by Allstate pursuant to this Agreement may be drawn upon at any time, notwithstanding any other provisions in this Agreement, and shall be utilized by Allstate Life of New York or any successor by operation of law, including, without limitation, any liquidator, rehabilitator, receiver or conservator of Allstate Life of New York, for one or more of the following purposes: (i) to reimburse Allstate Life of New York for Allstate’s share of premiums returned, but not ~~timely renewed~~ yet recovered from Allstate, to the holders of the Reinsured Policies under this Agreement on account of cancellations of such policies; (ii) to reimburse Allstate Life of New York for Allstate’s share of surrenders and benefits or ~~a substitute~~ losses paid by Allstate Life of New York under the terms and provisions of the Reinsured Policies reinsured by this Agreement; (iii) to fund an account with Allstate Life of New York in an amount at least equal to the deduction, for reinsurance ceded, from Allstate Life of New York’s liabilities for Reinsured Policies ceded under this Agreement. Such amount shall include, but not be limited to, amounts for Policy reserves, reserves for claims and losses incurred (including losses incurred but not reported), loss adjustment expenses, and unearned premiums; and (iv) to pay any other amounts Allstate Life of New York claims are due under the Reinsurance Agreement. All of the foregoing shall be applied without diminution because of insolvency on the part of the Allstate Life of New York or ~~amendment to letter~~ Allstate. (d) Allstate Life of ~~credit is not timely received, or if Tenant fails to maintain~~ New York shall return any amounts drawn down on the Letter of Credit in excess of the ~~amount~~ actual amounts required for subsection (c)(i), (ii) and (iii), or in ~~accordance with~~ the ~~terms set forth in this Article 27~~case of subparagraph (c)(iv), ~~Landlord~~ any amounts that are subsequently determined not to be due, and shall ~~have~~ credit Allstate quarterly interest on the ~~right to present~~ amounts drawn on the Letter of Credit ~~to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to~~ and held ~~by Landlord as cash~~ pursuant to subsection (c)(iii) above at the ~~“Cash Collateral”) to be held as collateral for performance~~ prime rate of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950interest.

Appears in 1 contract

Samples: Reinsurance Agreement (Allstate Life Insurance Co of New York)

Letter of Credit. ~~Within forty-five (45) days after~~ Before the ~~mutual execution and delivery of this Lease~~Commencement Date, Tenant shall deliver to ~~Landlord~~Landlord an unconditional, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an~~ irrevocable ~~and unconditional negotiable~~ letter of credit (“LC”) in the original amount of Two Hundred Eighty Thousand Dollars ($280,000) (the “~~Letter of Credit~~LC Stated Amount”); if Tenant does not deliver the LC to Landlord before the Commencement Date, ~~substantially~~ then Landlord may terminate this Lease in its entirety (including, without limitation, the Option set forth in Rider Two) effective, upon three (3) days prior written notice, at any time before it receives the LC from Tenant, in which case Landlord may retain all amounts deposited with or paid to Landlord by Tenant. The LC shall be issued by a national money center bank (“Bank”) reasonably acceptable to Landlord that has its headquarters in the United States and has a local Los Angeles branch office, and shall be in the form attached hereto as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). B. Tenant shall ~~provide Landlord with a specimen Letter of Credit from~~ pay all expenses, points and/or fees incurred in obtaining and renewing the ~~approved issuer prior to the execution of this Lease~~LC. The ~~Letter of Credit~~ LC shall ~~be: (a) at sight and irrevocable; (b) maintained in effect for the entire period~~ be effective from the date of ~~execution of this Lease~~ delivery thereof through the date which is ~~sixty~~ one hundred (60100) days ~~following~~ after the ~~Termination~~ expiration of the Term, as it may be extended pursuant to the terms of this Lease (the “LC Expiration Date”). The LC may be re-issued, renewed or replaced for annual periods, provided that the LC Stated Amount is not reduced except as expressly provided below. Each reissue, renewal or replacement LC shall be in the form attached hereto as Exhibit B, and shall be subject to Landlord’s prior written approval. The LC Stated Amount shall be reduced, effective on the fourth (4th) anniversary of the Commencement Date (“~~Letter of Credit Expiration~~ Reduction Date”), to the amount of Ninety Thousand Dollars ($90,000), subject to the ~~last paragraph~~ provisions of Subparagraphs (1) and (2) immediately below. (1) Notwithstanding any contrary provision hereof, if a Default by Tenant under this ~~Article 27~~Lease has occurred and is continuing on the Reduction Date, ~~provide that~~ or if Tenant is in default under this Lease and Tenant has received notice thereof as required by this Lease, but failed to cure such default within the ~~expiration date of~~ time period permitted under this Lease or such lesser time as may remain before the ~~Letter of Credit~~ Reduction Date, then the LC Stated Amount shall not be reduced on such Reduction Date (but shall be ~~no earlier than~~ reduced upon the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord curing of such ~~non-renewal by certified mail~~default, ~~return receipt requested at the address set forth~~ subject, however, to Landlord’s draw on the ~~form of Letter of Credit attached~~ LC as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord permitted hereunder in connection with ~~any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer~~a Default), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that:. (i2) ~~Landlord, or its then managing agent, shall have the right~~ Tenant hereby covenants to ~~draw down an amount up~~ provide to ~~the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that~~ Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be not less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the ~~expiration~~ Reduction Date, a certificate signed by an authorized officer or manager of Tenant stating to the best knowledge of the ~~Letter~~ certifying officer or manager, Tenant’s net worth as of ~~Credit or amendment), which shall be irrevocable and automatically renewable~~ a date not earlier than four (4) months prior to the applicable Reduction Date. If Tenant’s net worth as ~~above provided through the Lease Expiration Date upon the same terms as the expiring Letter~~ of ~~Credit or~~ such ~~other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit~~ date is ~~not timely renewed or~~ a ~~substitute or amendment to letter of credit is not timely received~~negative number, or if Tenant fails to ~~maintain~~ provide the ~~Letter of Credit in the amount and in accordance with the terms set forth in this Article 27~~certification as required hereunder, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in then the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be ~~entitled to any interest earned~~ reduced on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950Reduction Date.

Appears in 1 contract

Samples: Office Lease (NGTV)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after the mutual execution and delivery of this Lease, Tenant shall deliver to Landlord, as collateral~~ As additional security for the ~~full and faithful~~ performance by ~~Tenant of all~~ Mortgagor of its obligations under ~~this Lease~~the Loan Documents, Mortgagor has delivered to Mortgagee an ~~irrevocable and unconditional negotiable~~ irrevocable, unconditional, transferable, clean sight draft letter of credit ~~(the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running~~ for an amount equal to $436,000 in favor of ~~Landlord~~Mortgagee and entitling Mortgagee to draw thereon in New York, New York, issued by a ~~solvent bank reasonably approved~~ financial institution, the long term unsecured debt rating of which is in the three highest ratings given by ~~Landlord under the supervision~~ each of the ~~Superintendent~~ Rating Agencies (the "Letter of ~~Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”~~Credit"). ~~Tenant shall provide Landlord with a specimen~~ At least thirty days prior to the expiration date for the Letter of Credit ~~from the approved issuer prior to the execution of this Lease. The Letter of Credit~~ then in effect, Mortgagor shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date deliver an extension or replacement of the Letter of Credit ~~shall be no earlier than the~~ for a term of a least one year from such expiration date. Any Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, delivered pursuant hereto cannot be secured in whole or in ~~such form as is otherwise approved~~ part by ~~Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to~~ the ~~expiration of the Letter of Credit without any action whatsoever on the part of Landlord;~~Mortgaged Property. (cb) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, Mortgagee shall have the right to draw ~~down an amount up to the face amount of the Letter of Credit~~ upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in ~~part~~ part, immediately and without notice to Borrower, upon the ~~transferee and thereupon the Landlord shall, without~~ occurrence of any ~~further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer~~ one or ~~assignment~~ more of the ~~whole or any portion~~ following events: (i) an Event of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten Default occurs; (10ii) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx Mortgagor fails to ~~comply with the foregoing terms of this sentence~~deliver to Mortgagee, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later no less than thirty (30) days prior to the expiration date of the Letter of Credit (including any renewal, extension or ~~amendment~~replacement thereof), ~~which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter~~ a renewal, extension or replacement of ~~Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if~~ the Letter of Credit from a financial institution, the long term unsecured debt rating of which is ~~not timely renewed~~ in the three highest ratings given by each of the Rating Agencies; (iii) Mortgagee has received notice from the issuing financial institution that the Letter of Credit will be terminated; (iv) any action by Mortgagor or ~~a substitute or amendment~~ the issuing financial institution which, in Mortgagee's sole discretion, may jeopardize its rights to ~~letter of credit is not timely received, or if Tenant fails to maintain~~ properly draw on the Letter of Credit in ~~the amount and~~ whole or in part in accordance with the terms ~~set forth in this Article 27, Landlord shall have~~ thereof; and (v) Mortgagor fails to qualify for the ~~right to present~~ release of the Letter of Credit to as provided in subparagraph (d) below within two years after the ~~issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash~~ date hereof. (~~the “Cash Collateral”~~c) ~~to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result~~ Proceeds of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit ~~and/or utilize the Cash Collateral, in part or in whole,~~ may be applied to the ~~extent necessary to cure any default~~ payment of ~~Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by~~ the ~~express terms and conditions of this Lease. Xxxxxx agrees not to interfere~~ Debt in any ~~way with payment to Landlord~~ order in the Mortgagee's sole discretion. No delay by or omission of ~~the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of~~ Mortgagee in exercising any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw ~~from the Letter of Credit. No condition or term of this Lease shall be deemed to render~~ on the Letter of Credit ~~conditional~~ shall impair any such right, or shall be construed as a waiver of or acquiescence in, any default or event of default giving rise to ~~justify the issuer of the~~ such rights. (d) The Letter of Credit ~~in failing~~ shall be released if the Debt Service Coverage Ratio for the Mortgaged Property (based on a trailing three month collections), as reasonably determined by Mortgagee, is equal to ~~honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event~~ or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950greater than 1.25.

Appears in 1 contract

Samples: Mortgage, Assignment of Leases and Rents and Security Agreement (Cedar Income Fund LTD /Md/)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution and delivery~~ The Letter of ~~this Lease~~Credit shall be an unconditional, ~~Tenant shall deliver to Landlord~~irrevocable, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional~~ negotiable standby letter of credit running in favor of Landlord and shall be a signed draft. The issuer of the Letter of Credit (the “Issuer”) shall (1) be a solvent, nationally recognized commercial bank that is acceptable to Landlord in its reasonable discretion, (2) have a branch located in San Diego County, California and Bellevue, Washington (provided that if the Issuer is Silicon Valley Bank (“SVB”), it shall be sufficient to have a branch located in Santa Clara, California) capable of honoring a demand upon such Letter of Credit and allow presentation of the Letter of Credit by overnight courier delivery and by facsimile presentation, (3) be chartered under the laws of the United States, any State thereof or the District of Columbia, (4) be insured by the Federal Deposit Insurance Corporation; and (5) have a long term rating of BBB+ or higher as rated by Standard & Poor’s (collectively, the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC AmountCredit Issuer Requirements”). ~~Tenant shall provide Landlord with a specimen~~ Provided that SVB satisfies the Letter of Credit ~~from the approved issuer prior to the execution of this Lease~~Issuer Requirements, Landlord confirms that SVB is an acceptable Issuer. The Letter of Credit shall ~~be: (a) at sight and irrevocable; (b)~~ be maintained in ~~effect for~~ effect, whether through replacement, renew or extension, throughout the entire ~~period from the date of execution of this~~ Lease ~~through the date which is sixty~~ Term and for an additional one hundred twenty (60120) days following the ~~Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the~~ expiration ~~date~~ or earlier termination of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial drawsLease. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the The Letter of Credit, ~~in whole~~ and any extensions or ~~in part to the transferee and thereupon the Landlord shall~~renewals thereof, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be substantially in the form and content as attached hereto as Exhibit “A”, shall be for a term of not less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoingone year or, if the ~~Letter~~ remaining portion of the Lease Term is less than one year, then for such period plus one hundred twenty (120) days, and shall be irrevocable during that term. The Letters of Credit ~~expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to~~ covering subsequent periods shall be ~~in effect~~ obtained and delivered to ~~Landlord, as applicable,~~ Landlord not ~~later~~ less than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the then-existing Letter of Credit, ~~either prior to or following a “draw” by Landlord~~ without any action whatsoever on the part of ~~any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION~~Landlord. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or The term ~~of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon~~ for each such Letter of Credit ~~in a timely manner. Landlord and Tenant acknowledge and agree that in~~ shall begin no ~~event or circumstance shall~~ later than the expiration date of the previous Letter of Credit ~~or any renewal thereof or substitute therefor or Cash Collateral be:~~and shall comply with all requirements of this ~~(e) deemed to~~ Section 1.1. The Letter of Credit shall be ~~or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f)~~ subject to ~~the terms of such Section 1950.7; or~~ The Uniform Customs and Practice for Documentary Credits” (g2007 Revision) ~~intended to serve as a “security deposit” within the meaning of such Section 1950~~International Chamber Of Commerce Publication No. 600.

Appears in 1 contract

Samples: Office Lease Agreement (Smartsheet Inc)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after~~ Concurrently with the ~~mutual~~ execution ~~and delivery~~ of this Lease, Tenant shall deliver to ~~Landlord~~Landlord an unconditional, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an~~ irrevocable ~~and unconditional negotiable~~ standby letter of credit (~~the~~ “Letter of Credit”~~), substantially~~ ) which conforms in form and substance to the form attached as Exhibit ~~G hereto~~ “I” (or is otherwise acceptable to Landlord) and ~~made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord,~~ which: (i) is issued by a ~~solvent~~ United States federal or state chartered bank ~~reasonably approved by Landlord under the supervision~~ (“Issuer”) that is a member of the ~~Superintendent of Banks of the State of California~~New York Clearing House Association or is a commercial bank or trust company, ~~or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior~~ all as reasonably acceptable to ~~the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable~~Landlord; (bii) ~~maintained in effect for the entire period from~~ names Landlord as beneficiary thereunder; (iii) has a term ending not less than one year after the date of ~~execution of this Lease through the date which is sixty~~ issuance; (60iv) ~~days following the Termination Date (“Letter of Credit Expiration Date”)~~automatically renews for one-year periods unless Issuer notifies beneficiary in writing, subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) 60 days prior to the expiration date, that Issuer elects not to renew the Letter of Credit; (v) provides for payment to beneficiary of immediately available funds (denominated in United States dollars) in the amount of Two Million Five Hundred Thousand Dollars ($2,500,000.00) upon presentation of the Sight Draft substantially conforming to the form attached as Schedule “A” to the Letter of Credit ~~without any action whatsoever on~~ and the ~~part~~ certification required under the Letter of ~~Landlord~~Credit; (cvi) ~~subject~~ provides that draws may be presented, and are payable at the Issuer’s letterhead office or other office designated by the Issuer in writing (as reasonably acceptable to Landlord); (vii) is payable in sight drafts which only require the beneficiary to state that the draw is payable to the ~~Uniform Customs~~ order of beneficiary; (viii) permits partial and ~~Practices for Documentary Credits~~ multiple draws; (~~1993-Rev~~ix) ~~International Chamber of Commerce Publication #600~~permits multiple transfers by beneficiary; (x) waives any rights Issuer may have, at law or otherwise, to subrogate to any claims beneficiary may have against applicant or applicant may have against beneficiary; and (dxi) ~~fully assignable~~ is governed by ~~Landlord~~ the International Standby Practices 1998, published by the International Chamber of Commerce. Except as expressly provided in ~~connection with any number of transfers of Landlord’s interest in this Lease~~ Subsection 18.36(f) and (~~with Tenant bearing any fees~~k) below, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (~~and~~ as transferred, extended, renewed or replaced) must be maintained during the ~~bank issuing the same) shall be acceptable to Landlord~~entire Lease Term, ~~in Landlord’s reasonable discretion~~as extended or renewed, and ~~shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount~~ for a period of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business 45 days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Lease (Osi Systems Inc)

Letter of Credit. Within forty-five (45) days after the mutual execution and delivery of this Lease, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. a. The Letter of Credit ~~shall~~ provided pursuant to Paragraph 6 of the Lease is not, and has never been intended to be:, a security deposit. It is instead a more direct form of third party obligation where the issuer substitutes its own creditworthiness for that of the Tenant with the issuer having none of the defenses available to guarantors. ~~(a) at sight and irrevocable; (b) maintained in effect for the entire period from~~ b. Effective as of the date hereof, Paragraph 6.b. of ~~execution~~ the Lease is hereby deleted in its entirety. c. If Landlord exercises the Substitution Right (as defined in Paragraph 5.a. below), then so long as no Event of ~~this~~ Default by Tenant under the Lease ~~through~~ has occurred and is continuing as of the ~~date which is sixty (60) days following the Termination~~ Substitution Date (~~“Letter of Credit Expiration Date”~~as defined in Paragraph 5.b. below), ~~subject to~~ and so long as no breach or default by Tenant under the ~~last paragraph~~ Lease which, with notice or the passage of ~~this Article 27~~time or both could ripen into an Event of Default (an "Unmatured Default"), ~~provide that~~ shall be continuing as of the ~~expiration date of~~ Substitution Date, the amount required under the Letter of Credit shall be ~~no earlier than~~ reduced as of the ~~Letter~~ Substitution Date to equal twelve (12) month's worth of ~~Credit Termination Date or provide~~ Monthly Rent for ~~automatic renewal thereof at least through~~ the ~~Letter~~ Substitute Premises (as defined in Paragraph 5.a. below) as of ~~Credit Expiration Date, unless~~ the ~~issuing bank provides at least thirty~~ last twelve (3012) ~~days prior written notice~~ months of the term of the Lease. If Tenant is entitled to ~~Landlord of~~ such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such eventreduction, Tenant ~~shall deliver a new~~ may replace or amend the then existing Letter of Credit to reflect such reduced amount on or after the Substitution Date. If Landlord ~~at least thirty (30) days~~ disallows any such reduction by reason of an Unmatured Default, and if Tenant cures the Unmatured Default prior to the ~~expiration~~ same becoming an Event of Default, Tenant shall be entitled to a reduction of the Letter of Credit ~~without any action whatsoever on~~ as set forth in this Paragraph as of the ~~part of Landlord;~~date that is five (5) days after the date such Unmatured Default is cured. ~~(c) subject~~ d. Notwithstanding anything contained herein to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Creditcontrary, the amount of the Letter of Credit shall be ~~less than~~ reduced during the ~~LC Amount, Tenant shall, within ten~~ last twelve (1012) ~~business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount~~ months of the ~~LC Amount) and any such additional (or replacement) letter of credit shall comply with all~~ term of the ~~provisions of this Article 27,~~ Lease (whether or not Landlord has exercised the Substitution Right) at such times as reasonably agreed by Landlord and ~~if Xxxxxx fails to comply with~~ Tenant so that the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration amount of the Letter of Credit ~~or amendment), which shall be irrevocable~~ does not exceed the remaining Monthly Rent and ~~automatically renewable~~ Additional Rent (as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held estimated by Landlord ~~as cash (~~pursuant to Paragraph 7 of the ~~“Cash Collateral”~~Lease) ~~to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default~~ payable by Tenant under ~~this Lease pending Tenant’s delivery to Landlord of~~ the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Lease (Critical Path Inc)

Letter of Credit. Within ~~forty-~~five (455) business days ~~after the mutual~~ of Tenant’s execution and delivery of this Lease, Tenant shall deliver to Landlord, as ~~collateral~~ protection for the full and faithful performance by Tenant of all of its obligations under this Lease and, subject to the terms hereof, the Existing Lease, and for all losses and damages Landlord may suffer as a result of any breach or default by Tenant under this Lease, and the Existing Lease, an irrevocable and unconditional negotiable standby letter of credit (the “Letter of Credit”~~), substantially~~ ) in the form attached hereto as Exhibit ~~G hereto and made a part hereof,~~ D and containing the terms required herein, payable upon presentation to an operating retail branch located in ~~the State of~~ San Francisco, California, running in favor of ~~Landlord,~~ Landlord and issued by a ~~solvent~~ solvent, nationally recognized bank ~~reasonably approved by Landlord~~ with a long term rating from Standard and Poor’s Professional Rating Service of A or a comparable rating from Xxxxx’x Professional Rating Service or higher, under the supervision of the Superintendent of Banks of the State of California, or a ~~National Banking Association~~national banking association, in the ~~initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from~~ Deposit Amount set forth in the ~~approved issuer prior to the execution of this Lease~~Basic Lease Information. The Letter of Credit shall ~~be:~~ be referred to herein as the “Security Deposit”. The Letter of Credit shall (ai) be “callable” at ~~sight~~ sight, irrevocable and ~~irrevocable;~~ unconditional, (bii) be maintained in ~~effect~~ effect, whether through renewal (pursuant to a so-called “evergreen provision”) or extension, for the ~~entire~~ period from the Commencement Date and continuing until the date that is ninety (90) days after the expiration of the Term or the date of ~~execution~~ termination of ~~this~~ the Lease ~~through~~ (the ~~date which is sixty (60) days following the Termination Date (~~“~~Letter of Credit~~ LC Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, and Tenant shall deliver to Landlord a new Letter of ~~Credit to Landlord~~ Credit, certificate of renewal or extension amendment at least ~~thirty~~ sixty (3060) days prior to the expiration of the Letter of Credit then held by Landlord, without any action whatsoever on the part of Landlord; , (ciii) be fully transferable by Landlord, its successors and assigns, (iv) permit partial draws and multiple presentations and drawings, and (v) be otherwise subject to the ~~Uniform Customs and~~ International Standby Practices ~~for Documentary Credits (1993-Rev)~~ ISP 98, International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION590. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the ~~same~~same (the “Bank”)) shall be acceptable to Landlord, in Landlord’s reasonable discretion. If Landlord notifies Tenant in writing that the Bank which issued the Letter of Credit has become financially unacceptable because the above requirements are not met or the Bank has filed bankruptcy or reorganization proceedings or is placed into a receivership or conservatorship, ~~and~~ or the financial condition of the Bank has changed in any other materially adverse way then Tenant shall ~~provide~~have thirty (30) days to provide Landlord with a substitute Letter of Credit complying with all of the requirements of this Article 26. If Tenant does not so provide Landlord with a substitute Letter of Credit within such thirty (30) day period, ~~among other things~~then Landlord, or its then managing agent, shall h 3 the right to draw upon the then current Letter of Credit. In addition to Landlord's rights to draw upon the Letter as otherwise described in ~~effect that: (i)~~ this Article 26, Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit ~~upon~~ if any of the ~~presentation~~ following shall have occurred or be applicable: (A) such amount is an obligation of Tenant under the Lease that is past-due beyond applicable notice and cure periods under the terms and conditions of this Lease; (B) Tenant has filed a voluntary petition under the Bankruptcy Code, (C) an involuntary petition has been filed against Tenant under the Bankruptcy Code that is not dismissed within thirty (30) days, (D) the Bank has notified Landlord that the Letter of Credit will not be renewed or extended through the LC Expiration Date, or (E) Tenant has failed to deliver a new Letter of Credit or amendment to the ~~issuing bank~~ existing Letter of ~~Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing~~ Credit increasing the stated amount as required under the terms of this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the . The Letter of Credit will be honored by the ~~issuing bank without inquiry as to the accuracy thereof and~~ Bank regardless of whether ~~the~~ Tenant disputes ~~the content of such statement; and (iii) in the event of a transfer of~~ Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of ~~Credit and/or utilize~~ Credit. Tenant shall be responsible for paying the ~~Cash Collateral,~~ Bank’s fees in ~~part or in whole, to~~ connection with the ~~extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages~~ issuance of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, ~~either prior to~~ certificate of renewal or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950extension amendment.

Appears in 1 contract

Samples: Office Lease (iRhythm Technologies, Inc.)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution and delivery~~ Effective as of this Lease, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of ~~execution of this Lease through~~ the ~~date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”)~~initial funding pursuant to Section 6.1, ~~subject to the last paragraph of this Article 27, provide that the expiration date of~~ the Letter of Credit shall be ~~no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date~~deemed to have been issued pursuant to this Agreement, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant and shall ~~deliver a new Letter of Credit to Landlord at least thirty (30) days prior~~ be subject to the ~~expiration~~ terms and provisions hereof. (a) The sum of the Unpaid Drawings plus the Stated Amount of the Letter of Credit may not exceed the Letter of Credit Sublimit. (b) The Letter of Credit issued by the Issuing Bank pursuant hereto shall have an expiration date no later than the Maturity Date (but may provide by its terms for automatic annual renewal unless the Issuing Bank notifies the beneficiary that such Letter of Credit will not be renewed). (c) Prior to the occurrence and continuance of an Event of Default, Unpaid Drawings shall constitute, without the requirement of any further action ~~whatsoever~~ on the part of ~~Landlord; (c) subject~~ the Borrower, the making of a Base Rate Loan by the Lenders pursuant to Section 2.1(a). Accordingly, upon delivery to the ~~Uniform Customs~~ Lenders by Administrative Agent of notice of the deemed advance of such Base Rate Loan, each Lender hereby agrees to remit to the Issuing Bank funds in an amount equal to its ratable share of such Base Rate Loan. Upon the occurrence and ~~Practices for Documentary Credits (1993-Rev) International Chamber~~ continuance of ~~Commerce Publication #600; and~~an Event of Default, Unpaid Drawings shall be immediately due and payable. (d) ~~fully assignable by Landlord~~ The Borrower’s obligations to reimburse the Issuing Bank with respect to Unpaid Drawings (including, in ~~connection with~~ each case, interest thereon) shall be the primary obligation of the Borrower, absolute and unconditional under any ~~number~~ and all circumstances and irrespective of ~~transfers~~ any setoff, counterclaim or defense to payment which the Borrower may have or have had against any Lender, the Issuing Bank, the Administrative Agent or any beneficiary of ~~Landlord’s interest in this Lease (with Tenant bearing~~ the Letter of Credit, including, without limitation, any ~~fees, costs or expenses in connection with~~ defense based upon the failure of any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition drawing under a Letter of Credit to conform to the ~~foregoing, the form and~~ terms of the Letter of Credit or any non-application or misapplication by the beneficiary of the proceeds of such drawing; provided, however, that the Borrower shall not be obligated to reimburse the Issuing Bank for any wrongful payment made by the Issuing Bank under a Letter of Credit as a result of acts or omissions constituting willful misconduct or gross negligence on the part of the Issuing Bank (as determined by a court of competent jurisdiction in a final and non-appealable decision). Notwithstanding anything to the ~~bank issuing~~ contrary set forth herein, any action taken or omitted to be taken by the ~~same~~Issuing Bank under or in connection with the Letter of Credit, if taken or omitted in the absence of the Issuing Bank’s gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final and non-appealable decision), shall not create for the Issuing Bank any resulting liability to the Borrower. (e) ~~shall be acceptable~~ The Issuing Bank hereby grants to ~~Landlord, in Landlord’s reasonable discretion~~each Lender, and ~~shall provide~~each Lender hereby acquires from the Issuing Bank, ~~among other things,~~ a ratable participation interest in ~~effect that: (i) Landlord, or~~ the Letter of Credit. Each Lender acknowledges and agrees that its ~~then managing agent, shall have the right~~ obligation to ~~draw down an amount up~~ acquire such participation pursuant to ~~the face amount~~ this paragraph in respect of the Letter of Credit ~~upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord~~ is ~~entitled to make such drawing under this Lease~~absolute, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability thereforirrevocable, and ~~it is agreed that the provisions hereof~~ unconditional and shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall not be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound affected by any ~~such assignment~~circumstance whatsoever, ~~encumbrance~~including any amendment, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or ~~substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration~~ extension of the Letter of Credit or ~~amendment~~the occurrence and continuance of an Event of Default hereunder, or the reduction or termination of the Commitments. In furtherance and not in limitation of the foregoing, each Lender hereby absolutely and unconditionally agrees to pay to the Administrative Agent, for the account of the Issuing Bank, such Lender’s ratable share of any Unpaid Drawings promptly upon demand therefor by the Administrative Agent. (f) Upon receipt by the Issuing Bank of any payments from the Borrower as payment with respect to the Unpaid Drawings (whether in respect of interest of principal), ~~which~~ the Issuing Bank shall ~~be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or~~ remit such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit proceeds to the ~~issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral~~ Administrative Agent for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, distribution to the ~~extent necessary~~ Lenders. (g) The Issuing Bank shall provide notice to ~~cure any default of Tenant and/or to compensate Landlord for any~~ the Credit Parties and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of Loan Parties whenever a drawing is made under the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Secured Revolving Credit Agreement (Cowen Group, Inc.)

Letter of Credit. ~~Within forty-five (45) days after~~ 34.1 At Tenant’s election, in lieu of the ~~mutual~~ cash security deposit in the amount of the required Security Deposit as set forth in the Schedule on page 1 of this Lease, Tenant will deliver to Landlord contemporaneously with Tenant’s execution and delivery of this ~~Lease~~Lease an irrevocable letter of credit payable in San Jose, ~~Tenant shall deliver to Landlord~~California, ~~as collateral for~~ Miami, Florida; Naples, Florida; New York, New York; Chicago, Illinois; Santa Clara, California; or Scranton, Pennsylvania, in the ~~full and faithful performance by Tenant~~ amount of ~~all~~ the required Security Deposit set forth in the Schedule on page 1 of ~~its obligations under~~ this Lease, issued for the benefit of the Landlord by a bank reasonably satisfactory to Landlord (the “Issuing Bank”) which: (i) has an ~~irrevocable~~ A.M. Best Bank Deposit Rating of “a” or better; (ii) has a Standard & Poors Bank Survivability Assessment Rating of “A” or better; and ~~unconditional negotiable~~ (iii) has a Xxxxx’x Bank Financial Strength Rating of” B+” or better, in each case without qualification by “-” or other reduction or negative qualification of such rating); and (iv) has combined capital, surplus and undivided profits of not less than $500 million; provided, however, that Landlord approves Silicon Valley Bank as the Issuing Bank so long as it maintains a rating of at least *** (3 stars) at Xxxxxxxx.xxx (collectively, the “L/C Issuer Requirements”). Notwithstanding that the Issuing Bank may have met the L/C Issuer Requirements upon issuance of the letter of credit, if, during the Lease Term, the Issuing Bank fails to meet the L/C Issuer Requirements, or if the Issuing Bank enters into any form of regulatory or governmental receivership or other similar regulatory or governmental proceeding including, without limitation, any receivership instituted or commenced by the Federal Deposit Insurance Corporation (FDIC) or is otherwise declared insolvent or downgraded by the FDIC or put on an FDIC “watchlist,”, then Tenant shall within 10 business days after written notice from Landlord deliver to Landlord a replacement letter of credit which meets the requirements of this Paragraph 34 and issued by an Issuing Bank meeting the L/C Issuer Requirements; Tenant’s failure to do so will, notwithstanding anything in this Lease to the contrary, constitute an Event of Default for which there will be no notice or grace or cure period applicable thereto (other than the aforesaid 10-day period), and will give Landlord the immediate right, without further notice to Tenant, to draw upon such letter of credit. If Tenant replaces such letter of credit pursuant to the foregoing, Landlord will, within 30 days after Landlord’s receipt of the replacement letter of credit, deliver to Tenant the letter of credit so replaced. Each letter of credit will be irrevocable for the term of such letter of credit and will provide that it is automatically renewable for a period ending not earlier than 60 days after the expiration of the Lease Term (the “~~Letter of Credit~~Final L/C Expiration Date”~~), substantially in~~ ) without any action whatsoever on the ~~form attached as Exhibit G hereto and made a~~ part ~~hereof, and containing the terms required herein, payable in the State of California, running in favor~~ of Landlord. However, ~~issued by a solvent bank reasonably approved by~~ the Issuing Bank will have the right not to renew said letter of credit on written notice to Landlord ~~under~~ given not less than 60 days before the ~~supervision~~ expiration of the ~~Superintendent of Banks~~ then current term thereof (it being understood, however, that the privilege of the ~~State~~ Issuing Bank not to renew said letter of ~~California, or a National Banking Association~~credit will not, in any event, diminish the ~~initial amount~~ obligation of ~~$[***] (“LC Amount”).~~ Tenant ~~shall provide~~ to maintain such irrevocable letter of credit with Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to after the expiration of the ~~Letter of Credit without any action whatsoever on~~ Lease Term). Tenant must be the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms applicant of the ~~Letter~~ letter of ~~Credit (and the~~ credit. 34.2 The letter of credit must be issued by a bank ~~issuing the same) shall be acceptable~~ satisfactory to Landlord, must be in ~~Landlord’s reasonable discretion~~the form of Exhibit G, and ~~shall~~ must provide, among other things, in effect that: (ia) Landlord, or its then managing agent, ~~shall~~ will have the right to draw down an amount up to the face amount of the ~~Letter~~ letter of ~~Credit~~ credit upon the presentation to the ~~issuing bank~~ Issuing Bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity)sight draft; (iib) ~~the Letter~~ The letter of ~~Credit~~ credit will be honored by the ~~issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and~~Issuing Bank within 1 business day after; (~~iii~~c) in In the event of a transfer of Landlord’s interest in the Building, Landlord ~~shall~~ will have the right to transfer the ~~Letter~~ letter of ~~Credit, in whole or in part~~ credit to the transferee without the payment of any transfer fees, and thereupon the Landlord ~~shall~~will, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of ~~the whole or any portion~~ said letter of ~~said Letter of Credit~~ credit to a new ~~landlord~~Landlord; and (d) If the expiration date of the letter of credit is a day on which the issuer’s offices are closed, the expiration date shall automatically be extended pursuant to Section 3.13 or Section 3.14 of International Standby Practices ISP98 (International Chamber of Commerce Publication no. 590). 34.3 Landlord may draw upon the letter of credit at any time and from time to time if: (a) Tenant has failed to fulfill one or more of its obligations under this Lease; or (b) the letter of credit held by Landlord will expire earlier than the Final L/C Expiration Date (whether by reason of a stated expiration date or a notice of termination or non-renewal given by the Issuing Bank), and Tenant fails to deliver to Landlord, at least 30 days prior to the expiration date of the letter of credit then held by Landlord, a renewal or substitute letter of credit that is in effect and that complies with the requirements of this Paragraph 34. If, as a result of any such application ~~or use by Landlord~~ of all or any part of such security, the ~~Letter~~ amount secured by the letter of ~~Credit,~~ credit is less than the amount of the ~~Letter~~ required Security Deposit as set forth in the Schedule on page 1 of ~~Credit shall be less than the LC Amount~~this Lease, Tenant ~~shall, within ten (10) business days thereafter,~~ will forthwith provide Landlord with an additional letter(s) of ~~credit,~~ credit in an amount equal to the ~~deficiency (~~deficiency. 34.4 Tenant further covenants that it will not assign or ~~a replacement~~ encumber said letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. . 34.5 Without limiting the generality of the foregoing, if the ~~Letter~~ letter of ~~Credit~~ credit expires earlier than 60 days after the expiration of the Lease ~~Expiration Date~~Term, or the Issuing Bank notifies Landlord that it will not renew the letter of credit, Landlord will accept a renewal ~~letter of credit~~ thereof or substitute letter of credit (such renewal or substitute letter of credit to be in effect ~~and delivered to Landlord, as applicable,~~ not later than ~~thirty (30)~~ 30 days prior to the expiration ~~of the Letter of Credit or amendment~~thereof), ~~which shall be~~ irrevocable and automatically renewable as above provided ~~through~~ to the ~~Lease~~ Final L/C Expiration Date upon the same terms as the expiring ~~Letter~~ letter of ~~Credit~~ credit or such other terms as may be acceptable to ~~Landlord in its reasonable discretion~~Landlord. However, if the ~~Letter~~ letter of ~~Credit~~ credit is not timely renewed or a substitute ~~or amendment to~~ letter of credit is not timely received, ~~or if~~ Landlord may present such letter of credit to the bank, in accordance with the terms of Paragraph 34.3, and the entire sum secured thereby will be paid to Landlord, to be held by Landlord as provided in this Paragraph 34 and as provided in Paragraph 32 above. If Tenant fails to maintain the ~~Letter~~ letter of ~~Credit~~ credit in the amount and ~~in accordance with the~~ terms set forth in this ~~Article 27~~Paragraph 32, Tenant must immediately deposit with Landlord ~~shall have~~ a replacement letter of credit complying with the ~~right to~~ requirements of this Paragraph 34, failing which the Landlord may present ~~the Letter~~ such letter of ~~Credit~~ credit to the ~~issuing bank~~ bank, in accordance with the terms of this ~~Article 27~~Paragraph 34, and the entire sum ~~evidenced~~ secured thereby ~~shall~~ will be paid to ~~and~~ Landlord, to be held by Landlord as ~~cash (~~provided in this Paragraph 34 and as provided in Paragraph 32 above. In the ~~“Cash Collateral”)~~ event that Landlord draws upon the letter of credit solely due to ~~be held as collateral for performance of all of~~ Tenant’s ~~obligations under this Lease and for all losses and damages Landlord may suffer as~~ failure to renew the letter of credit at least thirty (30) days before its expiration or provide a ~~result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required~~ replacement letter of credit ~~in the LC Amount~~ as required herein (i) such failure to renew shall not constitute a default hereunder and ~~otherwise complying~~ (ii) Tenant shall at any time thereafter be entitled to provide Landlord with ~~all of the provisions of this Article 27. Upon delivery of such~~ a replacement letter of ~~credit~~credit that satisfies the requirements hereunder, ~~any Cash Collateral held by~~ at which time Landlord shall ~~be returned to Tenant. Landlord shall have~~ return the ~~right to hold Cash Collateral in a deposit account in~~ unapplied portion (if any) of the ~~name~~ cash proceeds of ~~Landlord and commingle~~ the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the original Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained drawn by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Lease Agreement (Fusion-Io, Inc.)

Letter of Credit. ~~Within forty-five~~ (45i) ~~days after~~ Subtenant may, at any time during the ~~mutual execution and~~ Term, by delivery of this Lease, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to ~~Landlord of such non-renewal by certified mail~~Sublandlord (the “Security Deposit Substitution Notice”), ~~return receipt requested at~~ substitute the ~~address set forth on the form of~~ “Letter of ~~Credit attached~~ Credit” as ~~Exhibit G~~defined below for the Security Deposit. Upon the delivery of the Security Deposit Substitution Notice to Sublandlord, ~~or in~~ Sublandlord shall within such ~~form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least~~ thirty (30) ~~days prior~~ day period, electronically transfer the Security Deposit to ~~the expiration~~ Subtenant pursuant to instructions from Subtenant, which transfer shall occur concurrently with Sublandlord’s receipt of the Letter of Credit. The Letter of Credit ~~without~~ shall serve as protection for the full and faithful performance by Subtenant of all of the obligations under this Sublease and for all damages Sublandlord actually suffers as a result of any ~~action whatsoever on~~ default beyond any applicable notice and cure periods by Subtenant under this Sublease and shall be an irrevocable and unconditional, negotiable standby letter of credit (“Letter of Credit”) in the ~~part~~ amount of ~~Landlord;~~ One Hundred Eighty-Six Thousand Two Hundred Seventy-Three and 62/100 Dollars (c) $186,273.62), subject to the ~~Uniform Customs~~ terms and ~~Practices for Documentary Credits~~ conditions of this Section 5(b). The Letter of Credit shall be issued by a solvent, nationally recognized bank having its principal office within the United States of America (~~1993-Rev~~the “Bank”) ~~International Chamber~~ and shall be capable of ~~Commerce Publication #600; and (d) fully assignable by Landlord~~ being drawn upon at a location in ~~connection with any number~~ the City of ~~transfers~~ Los Angeles via facsimile or otherwise. The Letter of ~~Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws~~Credit shall reflect Sublandlord as beneficiary. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the The form and terms of the Letter of Credit (and the ~~bank~~ issuer issuing ~~the same)~~ same shall be ~~acceptable~~ subject to ~~Landlord~~the review and approval of Sublandlord, in ~~Landlord’s reasonable~~ its sole discretion~~, and shall provide, among other things, in effect that: (i) Landlord~~. Sublandlord hereby pre-approves Bank of America as an acceptable Bank to issue the Letter of Credit. Sublandlord, or its ~~then~~ managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon ~~the~~ presentation to the ~~issuing bank~~ issuer of ~~Landlord~~Sublandlord’s ~~(or Landlord’s then managing agent’s)~~ written statement that ~~Landlord~~ Sublandlord is entitled to ~~make~~ the funds represented by such ~~drawing~~ Letter of Credit if any of the following shall have occurred or are applicable: (A) such amount is due to Sublandlord under the terms and conditions of this ~~Lease, it being understood~~ Sublease after a default by Subtenant and the expiration of all applicable notice and cure periods expressly set forth in this Sublease; provided that if ~~Landlord~~ Sublandlord is prevented from delivering a notice of default to Subtenant for any reason, including, without limitation, because Subtenant has filed a voluntary petition, or ~~its managing agent be a corporation~~an involuntary petition has been filed against Subtenant, ~~partnership~~ under the U.S. Bankruptcy Code or ~~other entity~~any state bankruptcy code (collectively, “Bankruptcy Code”), then no such ~~statement~~ notice and cure period shall be ~~signed by~~ required; (B) Subtenant has filed a voluntary petition under the Bankruptcy Code; (C) an ~~officer~~ involuntary petition has been filed against Subtenant under the Bankruptcy Code; or (~~if a corporation), a general partner (if a partnership),~~ D) the Bank has notified Sublandlord that it intends to revoke the Letter of Credit or ~~any authorized party (if another entity); (ii)~~ the Letter of Credit will not be ~~honored by~~ renewed or extended beyond and after the ~~issuing bank without inquiry as to the accuracy thereof and regardless~~ final expiration date of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said this Sublease. The Letter of Credit ~~to a new landlord. If, as a result of any application or use by Landlord of all or any part of~~ shall provide that the ~~Letter of Credit, the amount~~ issuer of the Letter of Credit shall deliver to Sublandlord at least thirty (30) days written notice prior to revoking, terminating or failing to renew the Letter of Credit. The issuer will honor the Letter of Credit regardless of whether Subtenant disputes Sublandlord’s right to draw on the Letter of Credit. Sublandlord shall not be ~~less than~~ required to give Subtenant written notice prior to any drawing upon the ~~LC Amount~~Letter of Credit. The Letter of Credit must permit multiple presentations or drawings and partial drawings. In the event Sublandlord makes a draw on the Letter of Credit, ~~Tenant shall,~~ Subtenant shall within ten (10) ~~business~~ days ~~thereafter, provide Landlord with an additional letter(s)~~ after the date of ~~credit, in an amount equal to~~ such draw cause the ~~deficiency (or a replacement letter of credit in the total~~ amount of the ~~LC Amount~~Letter or Credit to be increased to its original amount. (ii) Subtenant acknowledges and ~~any such additional (or replacement) letter~~ agrees that Sublandlord is entering into this Sublease in material reliance on the ability of ~~credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails~~ Sublandlord to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if draw on the Letter of Credit ~~expires earlier than~~ on the ~~Lease Expiration Date, Landlord will accept a renewal letter~~ occurrence of ~~credit~~ any breach or ~~substitute letter~~ default on the part of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in Subtenant under this ~~Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank~~ Sublease in accordance with the terms of this ~~Article 27, and the entire sum evidenced thereby~~ Section 5(b). If Subtenant shall breach any provision of this Sublease or otherwise be ~~paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations~~ in default under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease Sublease beyond all applicable notice and cure periods, ~~Landlord~~ Sublandlord may, but without obligation to do so, and without notice to Subtenant, draw ~~upon~~ on the Letter of ~~Credit and/or utilize the Cash Collateral~~Credit, in part or in whole, to ~~the extent necessary to~~ cure any such breach or default of ~~Tenant and/or~~ Subtenant and to compensate ~~Landlord~~ Sublandlord for any and all damages of any kind or nature sustained or which ~~may be sustained by Landlord~~ Sublandlord reasonably estimates that it will sustain resulting from ~~Tenant~~Subtenant’s breach or default. The use, application, or retention of the Letter of Credit, or any portion of it, by Sublandlord shall not prevent Sublandlord from exercising any other right or remedy provided by this Sublease or by any applicable law, it being intended that Sublandlord shall not first be required to proceed against the Letter of Credit, and shall not operate as a limitation on any recovery to which Sublandlord may otherwise be ~~permitted by the express terms and conditions of this Lease~~entitled. ~~Xxxxxx~~ Subtenant agrees not to interfere in any way with payment to ~~Landlord~~ Sublandlord of the proceeds of the Letter of Credit, either ~~prior to~~ before or following a ~~“draw”~~ draw by ~~Landlord~~ Sublandlord of any portion of the Letter of Credit, ~~[***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION.~~ regardless of whether any dispute exists between ~~Xxxxxx~~ Subtenant and ~~Landlord~~ Sublandlord as to ~~Landlord~~Sublandlord’s right to draw ~~from~~ on the Letter of Credit. No condition or term of this ~~Lease~~ Sublease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing ~~upon~~ on such Letter of Credit in a timely manner. ~~Landlord~~ Subtenant agrees and ~~Tenant~~ acknowledges that: (1) the Letter of Credit constitutes a separate and independent contract between Sublandlord and the Bank; (2) Subtenant is not a third party beneficiary of such contract; and (3) if Subtenant becomes a debtor under any chapter of the Bankruptcy Code, neither Subtenant, any trustee, nor Subtenant’s bankruptcy estate shall have any right to restrict or limit Sublandlord’s claim or rights to the Letter of Credit or the proceeds of it by application of Section 502(b)(6) of the U.S. Bankruptcy Code or otherwise, and Subtenant acknowledges and agrees that the Letter of Credit and the proceeds thereof are not and shall not be a part of the Subtenant’s bankruptcy estate. (iii) Sublandlord and Subtenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal ~~thereof~~ of it or ~~substitute therefor or Cash Collateral be:~~ any proceeds of it be (eA) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; , (fB) subject to the terms of ~~such~~ Section 1950.7~~; or~~ , or (gC) intended to serve as a “security deposit” within the meaning of Section 1950.7. Sublandlord and Subtenant further acknowledge and agree that the Letter of Credit is not intended to serve as a security deposit and Section 1950.7 and any and all other laws, rules, and regulations applicable to security deposits in the commercial context (“Security Deposit Laws”) shall have no applicability or relevancy to the Letter of Credit, and waive any and all rights, duties, and obligations either party may now or in the future have relating to or arising from the Security Deposit Laws. (iv) If Sublandlord transfers its interest in the Subleased Premises (by virtue of a merger, corporate reorganization or otherwise), Sublandlord may (A) transfer (one or more times) all or any portion of its interest in and to the Letter of Credit to another party, person or entity regardless of whether such transfer is separate from or a part of the assignment by Sublandlord of its rights and interests in and to this Sublease, or (B) may require that Subtenant furnish to Sublandlord’s transferee a substitute or amended Letter of Credit, naming such transferee as the beneficiary and otherwise in compliance with this Section ~~1950~~5(b), provided such transferee reimburses Subtenant for the nominal administrative fee charged by the issuer of the Letter of Credit for issuing a substitute or amended Letter of Credit in the name of the transferee. In the event of a transfer of Sublandlord’s interest in the Subleased Premises and the transfer (or substitution or amendment) of the Letter of Credit to Sublandlord’s transferee, Sublandlord shall be released by Subtenant from all liability therefor.

Appears in 1 contract

Samples: Sublease Agreement (Avanir Pharmaceuticals, Inc.)

Letter of Credit. ~~Within forty-five~~ The following is added as Section 37.23 of the Lease: (45a) ~~days after~~ The terms set forth in this Section 37.21 shall only apply if Tenant, pursuant to Section 1.14 and Section 8 herein, chooses to provide the ~~mutual execution~~ Security Deposit in the form of a letter of credit. (b) Landlord and ~~delivery~~ Tenant acknowledge that Tenant will occupy space in the Bank of America Building pursuant to this Lease and, as consideration for Landlord’s willingness to enter into this Lease, Tenant shall deliver or cause to be delivered to Landlord, ~~as collateral for~~ and shall cause to be maintained at all times in effect, one or more irrevocable standby letters of credit complying with the ~~full and faithful performance~~ terms of this Section 37.21. Any failure by Tenant ~~of all of its obligations~~ to perform or observe any term, covenant or agreement set forth in this Section 37.21 shall constitute a material default under this Lease. Smartsheet Second Lease Addendum (Suites 300 and 350) 1 (c) Tenant shall deliver or cause to be delivered to Landlord, or Landlord’s advising bank as directed by Landlord, an irrevocable ~~and unconditional negotiable~~ standby letter of credit in a form acceptable to or provided by Landlord (acceptance not to be unreasonably withheld) (the “Letter of Credit”), ~~substantially in~~ issued by a national banking association reasonably acceptable to Landlord (the ~~form attached as Exhibit G hereto and made a part hereof~~Silicon Valley Bank being acceptable to Landlord), ~~and containing~~ for the ~~terms required herein, payable in the State~~ account of ~~California, running~~ Tenant in favor of ~~Landlord, issued by a solvent bank reasonably approved by~~ Landlord ~~under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association,~~ in the initial amount determined in accordance with Section 8 of ~~$[***]~~ the Lease, having an expiry date not earlier than the Expiration Date, and stating by its terms that it shall be automatically extended annually, without written amendment or modification, to the date that is the earlier of (~~“LC Amount”). Tenant shall provide Landlord with a specimen~~ i) the date one (1) year after the then current expiry date or (ii) the Expiration Date unless the issuer of the Letter of Credit ~~from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a)~~ gives Landlord, at ~~sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is~~ least sixty (60) days ~~following~~ prior to the ~~Termination Date (“~~then current expiry date, written notice that the issuer elects not to extend the Letter of ~~Credit Expiration Date”), subject to~~ Credit. If the ~~last paragraph of this Article 27, provide that the expiration date~~ issuer of the Letter of Credit ~~shall be no earlier than~~ at any times gives to Landlord notice that the issuer elects not to extend the Letter of ~~Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date~~Credit, ~~unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail~~then, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least not less than thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part current expiry date of the Letter of Credit, Tenant shall deliver or cause to be delivered to Landlord (or Landlord’s advising bank) a substitute irrevocable standby letter of credit issued in favor of Landlord by a national banking association reasonably acceptable to Landlord in an amount required by Section 8 of the Lease. Not less than thirty (30) days prior to the expiry date of any substitute letter of credit delivered pursuant to this Section, Tenant shall deliver or cause to be delivered to Landlord (or Landlord’s advising bank) a further substitute irrevocable standby letter of credit issued in favor of Landlord by a national banking association reasonably acceptable to Landlord in an amount required by Section 8 of the Lease. Each substitute letter of credit delivered pursuant to this Section 37.21 shall have a term of not less than one (1) year and shall be in a form acceptable to or provided by Landlord. (d) Upon the occurrence of any breach or default under this Lease including, but not limited to, any failure by Tenant timely to deliver or cause to be delivered to Landlord (or Landlord’s advising bank) any substitute letter of credit required pursuant to this Section 37.21, Landlord, at its option, may, following expiration of any applicable notice or cure period, draw against the Letter of Credit and any substitute letter of credit delivered pursuant to this Section 37.21 in an amount reasonably necessary to cure such breach or default and/or to compensate Landlord for any other loss or damage which Landlord may suffer by reason of Tenant’s breach or default. The Letter of Credit and each substitute letter of credit (also referred to as a “Letter of Credit”) delivered pursuant to this Section 37.21 shall ~~be less than~~ provide for payment against Landlord’s (or any transferee’s) draft at sight, by facsimile presentation, or by courier, accompanied by a certificate stating substantially as follows: “Drawn under ____________ Bank, N.A.’s Irrevocable Standby Letter of Credit No. ________, dated ________________, 2020, as a result of the ~~LC Amount~~occurrence of a default under the Lease dated __________, 2020, between Bellevue Place Office, LLC, a Washington limited liability company, and SMARTSHEET INC., a Washington corporation.” If Landlord draws against the Letter of Credit, Tenant shall, within ten (10) ~~business~~ days ~~thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount~~ of the ~~LC Amount) and any~~ date of such ~~additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27~~draw, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if restore the Letter of Credit ~~expires earlier than~~ or provide additional irrevocable standby letters of credit so that, at all times, there shall be an amount required by Section 8 of the Lease ~~Expiration Date,~~ available for Landlord ~~will accept~~ to draw against in the event of any further breach or default under this Lease. (e) If the Letter of Credit is not renewed or Tenant does not provide a ~~renewal~~ substitute irrevocable standby letter of credit on or ~~substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than~~ before the date that is thirty (30) days prior to the ~~expiration~~ expiry date of the then current Letter of Credit, or in the event Landlord draws against the Letter of Credit, if Tenant does not restore the Letter of Credit or ~~amendment), which shall be irrevocable and automatically renewable as above provided through~~ provide additional letters of credit so that an amount required by Section 8 of the Lease ~~Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable~~ is available to Landlord to draw upon in ~~its reasonable discretion. However~~the event of any further breach or default under this Lease, if then in such event the amount of the draw against the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit may be equal to the ~~issuing bank in accordance with the terms of this Article 27, and the~~ entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds amount of the Letter of Credit~~, either prior to or following a “draw” by Landlord~~ . The proceeds of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw ~~from the Letter of Credit. No condition or term of this Lease shall be deemed to render~~ against the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject pursuant to the ~~terms~~ immediately preceding sentence shall be held by Landlord as an additional security deposit pursuant to the provisions of ~~such~~ Section ~~1950.7; or~~ 8 of this Lease. Smartsheet First Lease Addendum (gSuites 300 and 350) ~~intended to serve as a “security deposit” within the meaning of such Section 1950.~~2

Appears in 1 contract

Samples: Office Lease (Smartsheet Inc)

Letter of Credit. ~~Within forty-five (45) days after the mutual~~ Concurrent with its execution ~~and delivery~~ of this Lease, Tenant shall deliver to Landlord, as ~~collateral~~ protection for the full and faithful performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer (or that Landlord reasonably estimates it may suffer) as a result of any breach, default or failure to perform by Tenant under this Lease, an irrevocable and unconditional negotiable ~~letter~~ standby Letter of ~~credit~~ Credit (~~the~~ “Letter of Credit”), ~~substantially~~ in the form ~~attached~~ as ~~Exhibit G hereto and made a part hereof, and containing the terms required herein~~is acceptable to Landlord, payable at an office in the ~~State of~~ San Francisco Bay Area, California, running in favor of ~~Landlord,~~ Landlord and issued by a ~~solvent~~ solvent, nationally recognized bank ~~reasonably approved by Landlord~~ with a long term rating of BBB or higher, under the supervision of the Superintendent of Banks of the State of California, or a ~~National Banking Association~~national banking association (an “Acceptable Issuing Bank”), in the ~~initial~~ amount provided in Section 1.11 of ~~$[***]~~ this Lease (the “LC Letter of Credit Amount”). Tenant shall ~~provide~~ pay all expenses, points, or fees incurred by Tenant in obtaining the Letter of Credit and any replacement Letter of Credit. The bank issuing the Letter of Credit (the “Bank”) shall be subject to Landlord’s prior written approval, which approval shall not be withheld by Landlord ~~with~~ if the proposed Bank is an Acceptable Issuing Bank. If an Acceptable Issuing Bank is declared insolvent or taken over by the Federal Deposit Insurance Corporation or any governmental agency for any reason or does not meet the standards to be approved an Acceptable Issuing Bank, Tenant shall deliver a ~~specimen~~ replacement Letter of Credit from another Bank approved by Landlord that meets the ~~approved issuer prior to~~ standards for an Acceptable Issuing Bank within the ~~execution~~ earlier of ~~this Lease~~(i) thirty (30) days after notice from Landlord that the Bank does not meet the standard for an Acceptable Issuing Bank, or (ii) the date the Bank is declared insolvent or taken over for any reason by the Federal Deposit Insurance Corporation or any other governmental agency. ~~The~~ In addition, the Letter of Credit shall beexpressly provide for the following: (a) shall be “callable” at ~~sight~~ sight, irrevocable, and ~~irrevocable~~unconditional; (b) shall be maintained in ~~effect~~ effect, whether through renewal or extension, for the ~~entire~~ period from the date of ~~execution of~~ this Lease ~~through~~ and continuing until the date ~~which is sixty~~ (~~60) days following~~ the ~~Termination Date (~~“Letter of Credit Expiration Date”) that is ninety (90) days after the expiration of the Term (as the Term may be extended). The Letter of Credit may be for one year period, ~~subject~~ provided the Letter of Credit is automatically extended for not less than a one year period unless the issuing Bank provides written notice to Landlord not less than sixty (60) days prior to the ~~last paragraph of this Article 27, provide that the~~ then expiration date of the Letter of Credit ~~shall be no earlier than~~ that the issuing Bank will not renew or extend the Letter of ~~Credit Termination Date or provide for automatic renewal thereof at least through the~~ Credit, in which case Tenant shall deliver to Landlord a replacement Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least not less than thirty (30) days prior to the scheduled expiration date of the then existing Letter of Credit held by Landlord without any action whatsoever on the part of Landlord; (c) shall be fully assignable by Landlord, its successors, and assignees of its interest in the Premises; (d) shall permit partial draws and multiple presentations and drawings; and (e) shall be otherwise subject to the Uniform Customs and Practices for Documentary ~~Credits (1993-Rev)~~ Credits, International Chamber of Commerce Publication ~~#600; and~~ No. 600 (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnershipUCP600), or ~~any authorized party~~ the International Standby Practices-ISP 98, International Chamber of Commerce Publication No. 590 (~~if another entity~~1998); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Office Lease (Biotie Therapies Corp.)

Letter of Credit. ~~Within forty-five (45) days after the mutual execution and delivery of this Lease, Tenant shall deliver to Landlord, as collateral~~ As security for the ~~full and faithful~~ performance by Tenant of ~~all~~ Tenant's obligations hereunder, Tenant shall cause to be delivered to Landlord concurrently with the execution of ~~its obligations under~~ this ~~Lease~~Lease by Tenant, an original irrevocable ~~and unconditional negotiable~~ standby letter of credit (the “"Letter of Credit~~”), substantially~~ ") in the ~~form attached~~ amount specified in Article 1 above, naming Landlord as ~~Exhibit G hereto and made~~ beneficiary, which Landlord may draw upon to cure any default under this Lease or to compensate Landlord for any damage Landlord incurs as a ~~part hereof, and containing~~ result of Tenant's failure to perform any of its obligations hereunder. Any such draw on the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit ~~from the approved issuer prior~~ shall not constitute a waiver of any other rights of Landlord with respect to ~~the execution of this Lease~~such default or failure to perform. The Letter of Credit shall ~~be: (a) at sight~~ be issued by a major commercial bank reasonably acceptable to Landlord, with a San Francisco, California, or New York, New York, service and ~~irrevocable; (b) maintained in effect~~ claim point for the ~~entire~~ Letter of Credit, have an expiration date not earlier than the sixtieth (60'h) day after the Expiration Date (or, in the alternative, have a term of not less than one (1) year and be automatically renewable for an additional one (1) year period ~~from~~ unless notice of non-renewal is given by the ~~date of execution of this Lease through the date which is~~ issuer to Landlord not later than sixty (60) days ~~following~~ prior to the ~~Termination Date (“~~expiration thereof) and shall provide that Landlord may make partial and multiple draws thereunder, up to the face amount thereof. In addition, the Letter of Credit ~~Expiration Date”)~~shall provide that, ~~subject to~~ in the ~~last paragraph~~ event of Landlord's assignment or other transfer of its interest in this ~~Article 27~~Lease, ~~provide that the expiration date of~~ the Letter of Credit shall be freely transferable by Landlord, without charge and without recourse, to the assignee or transferee of such interest and the bank shall confirm the same to Landlord and such assignee or transferee. The Letter of Credit shall provide for payment to Landlord upon the issuer's receipt of a sight draft from Landlord together with Landlord's certificate certifying that Landlord is entitled to such payment pursuant to the provisions of this Lease, and with no other conditions, shall be in the form attached hereto as Exhibit D, and otherwise be in form and content reasonably satisfactory to Landlord. Ifthe Letter of Credit has an expiration date earlier than the ~~Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit~~ Expiration Date, ~~unless~~ then throughout the ~~issuing bank provides at least thirty~~ term hereof (30including any renewal or extension of the term) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall ~~deliver a new~~ provide evidence of renewal of the Letter of Credit to Landlord at least ~~thirty~~ sixty (3060) days prior to the ~~expiration of~~ date the Letter of Credit ~~without any action whatsoever~~ expires. If Landlord draws on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up pursuant to the ~~face amount of~~ terms hereof, Tenant shall immediately replenish the Letter of Credit ~~upon the presentation~~ or provide Landlord with an additional letter of credit conforming to the ~~issuing bank~~ requirement of ~~Landlord’s (or Landlord’s then managing agent’s) written statement~~ this paragraph so that the amount available to Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) from the Letter of ~~Credit will be honored by~~ Credit(s) provided hereunder is the ~~issuing bank without inquiry as~~ amount specified in Article 1 above. Tenant's failure to ~~the accuracy thereof and regardless~~ deliver any replacement, additional or extension of ~~whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer~~ the Letter of Credit, or evidence of renewal of the Letter of Credit, within the time specified under this Lease shall entitle Landlord to draw upon the Letter of Credit then in ~~whole or~~ effect and, at Landlord's election, constitute a default under this Lease. If Landlord liquidates the Letter of Credit as provided in ~~part to~~ the ~~transferee and thereupon~~ preceding sentence, Landlord shall hold the ~~Landlord shall, without any further agreement between~~ funds received from the ~~parties, be released by Tenant from all liability therefor~~Letter of Credit as security for Tenant's performance under this Lease, and ~~it is agreed that the provisions hereof~~ Landlord shall ~~apply~~ not be required to ~~every transfer~~ segregate such security deposit from its other funds and no interest shall accrue or ~~assignment~~ be payable to Tenant with respect thereto. No holder of a Mortgage, nor any purchaser at any judicial or private foreclosure sale of the ~~whole~~ Project or any portion thereof, shall be responsible to Tenant for such security deposit unless and only to the extent such holder or purchaser shall have actually received the same. If Tenant is not in default at the expiration or termination of ~~said~~ this Lease, Landlord shall return to Tenant the Letter of Credit ~~to a new landlord. If~~or the balance of the security deposit then held by Landlord, as ~~a result of~~ applicable; provided, however, that in no event shall any ~~application or use~~ such return be construed as an admission by Landlord that Tenant has performed all of its covenants and obligations hereunder. Tenant hereby unconditionally and irrevocably waives the benefits and protections of California Civil Code Section 1950.7, and, without limitation of the scope of such waiver, acknowledges that Landlord may use all or any part of the Letter of ~~Credit~~Credit or the proceeds thereof to compensate Landlord for damages resulting from termination of this Lease and the tenancy created hereunder (including, without limitation, damages recoverable under California Civil Code Section 1951.2). The Letter of Credit shall reduce in amount on (i) the first day of the sixty-first (61'') full calendar month following the Rent Commencement Date, (ii) the first day of the seventy third (73rd) full calendar month following the Rent Commencement Date, (iii) the first day of the eighty-fifth (8511) full calendar month following the Rent Commencement Date, (iv) the first day of the ninety-seventh (971 ) full calendar month following the Rent Commencement Date, and (v) the first day of the one hundred ninth (1091 ) full calendar month following the Rent Commencement Date (each a "Reduction Date"), by the amount of Three Hundred Forty Thousand Dollars ($340,000.00) on each such Reduction Date; provided, however, that if (i) on or prior to the Reduction Date, a default, by Tenant shall have occurred, or (ii) on the Reduction Date, Tenant's net worth (as defined below) is less than One Hundred Fifty Million Dollars ($150,000,000.00), then the Letter of Credit amount shall not reduce on such date and shall not thereafter reduce. If Tenant is entitled to any such reduction, then Landlord shall cooperate in a commercially reasonable manner with Tenant upon Tenant's request to replace or amend the then existing Letter of Credit to reflect the reduced amount of the Letter of ~~Credit shall be less than the LC Amount~~Credit; provided, ~~Tenant shall~~however, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event ~~or circumstance~~ shall any such reduction be construed as an admission by Landlord that Tenant has performed all of its covenants and obligations hereunder. Tenant's "net worth" shall mean the ~~Letter~~ total assets of ~~Credit or any renewal thereof or substitute therefor or Cash Collateral be:~~ Tenant less liabilities (eincluding, without limitation, contingent liabilities) ~~deemed to be or treated~~ of Tenant, as computed in accordance with GAAP. In connection with the test of Tenant's net worth on a ~~“security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to~~ Reduction Date, Tenant shall provide Landlord with Tenant's then current quarterly financial statements which satisfy the terms of ~~such~~ Section ~~1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~30.F. below.

Appears in 1 contract

Samples: Sublease (Aerohive Networks, Inc)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after the mutual execution and delivery of this Lease,~~ Tenant shall ~~deliver~~ have the right to ~~Landlord,~~ deposit and maintain the Security Deposit as ~~collateral for the full and faithful performance by Tenant of all of its obligations under this Lease,~~ an irrevocable ~~and unconditional negotiable~~ commercial letter of credit in form and substance reasonably acceptable to Landlord. (A letter of credit meeting the “terms of this Section is referred to as the "Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen .") The Letter of Credit ~~from~~ must be issued by NationsBank, N.A. or another commercial bank (the ~~approved issuer prior~~ "Issuer") reasonably acceptable to Landlord and must be presentable in the ~~execution of this Lease~~Washington, D.C. metropolitan area. The Letter of Credit ~~shall be: (a)~~ must also be payable at sight ~~and irrevocable;~~ without presentation of any other documents, statements, or authorizations (~~b) maintained in effect~~ except for the ~~entire period~~ draw request form attached thereto), must allow for partial draws, and must have a term of not less than one (1) year from the ~~date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“~~Commencement Date. The Letter of Credit ~~Expiration Date”)~~must also provide for its automatic renewal on a year-to-year basis unless the Issuer gives Landlord at least two (2) months written notice of nonrenewal, ~~subject to~~ and the ~~last paragraph of this Article 27, provide that the~~ final expiration date of the Letter of Credit ~~shall~~ may not be no any earlier than the date which is three (3) months after the scheduled initial Lease Term expiration date (or, in the case of a renewal when the Security Deposit has not been refunded to Tenant, three (3) months after the scheduled expiration date of the renewal Lease Term). (b) The Letter of Credit ~~Termination Date~~ must also be subject to being drawn upon in the event of any default by Tenant under this Lease, or ~~provide for automatic renewal thereof at least through~~ if the Issuer gives notice of nonrenewal to Landlord and a replacement Letter of Credit ~~Expiration Date, unless~~ (or the ~~issuing bank provides at least thirty (30~~cash equivalent) ~~days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as~~ is ~~otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit~~ not delivered to Landlord at least thirty (30) days prior to the ~~expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993~~non-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the renewed Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit's expiration date, or ~~any part thereof~~ if there is a dispute between Landlord and ~~that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting~~ Tenant on the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than date which is thirty (30) days prior to the stated expiration date of the Letter of Credit ~~or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as~~ over whether Landlord may ~~be acceptable to Landlord in its reasonable discretion. However, if~~ draw on the Letter of ~~Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received~~Credit, or if ~~Tenant fails~~ Landlord assigns this Lease to ~~maintain~~ a third party and the ~~Letter~~ Issuer does not consent to the transfer of ~~Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present~~ the Letter of Credit to the ~~issuing bank in accordance with~~ successor Landlord, or if the ~~terms of this Article 27, and~~ Issuer is not solvent or the ~~entire sum evidenced thereby shall be paid~~ Issuer has been put into conservatorship or receivership (or any similar program) by any governmental authority having regulatory oversight over the Issuer. Notwithstanding any implication to ~~and held by Landlord as cash (~~the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit contrary contained in the ~~LC Amount~~ foregoing, it is understood and ~~otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned~~ agreed that Landlord's willingness to ~~Tenant. Landlord shall have the right to hold Cash Collateral in~~ accept a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit ~~and/or utilize~~ as the ~~Cash Collateral,~~ Security Deposit in ~~part or in whole,~~ lieu of cash is an accommodation to ~~the extent necessary to cure any default of~~ Tenant ~~and/or to compensate Landlord for any~~ and that Tenant bears all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord risk of the ~~proceeds~~ Issuer failing, refusing or being unable to honor a proper draw thereon. If the Issuer fails, refuses or is unable to honor a proper presentment of the Letter of Credit, ~~either prior~~ Tenant shall be obligated to ~~or following~~ immediately deliver a ~~“draw” by Landlord of any portion of the~~ replacement Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from Credit meeting the ~~Letter of Credit. No condition or term~~ terms of this ~~Lease~~ paragraph (or the cash equivalent) to serve as the Security Deposit. A letter of credit in the form attached hereto as Exhibit G meets the technical requirements of this Section. (c) In the event the Security Deposit is to be reduced pursuant to Section 5.1 above, Landlord shall ~~be deemed to render~~ return the Letter of Credit ~~conditional~~ it then possesses upon delivery to ~~justify the issuer~~ it of ~~the~~ cash or a replacement Letter of Credit in ~~failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall~~ the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950appropriate amount.

Appears in 1 contract

Samples: Lease Agreement (Edutrek Int Inc)

Letter of Credit. ~~Within forty-five (45) days~~ 42.1 From and after the ~~mutual execution and delivery~~ date that Tenant delivers the Letter of ~~this~~ Credit to Landlord (as provided for in the Basic Provisions of the Lease), ~~Tenant~~ Landlord shall ~~deliver~~ have the right to ~~Landlord~~draw upon the Letter of Credit or any renewal or extension thereof, ~~as collateral for~~ in whole or in part, upon the ~~full and faithful performance by Tenant~~ occurrence of ~~all~~ any one or more of ~~its obligations~~ the following events, each of which shall be deemed an Event of Default under this Lease, an irrevocable and unconditional negotiable letter of credit (the “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) ~~at sight and irrevocable~~The occurrence of any Event of Default under this Lease; (b) ~~maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60)~~ Tenant’s failure to deliver to Landlord, no less than 30 days ~~following the Termination Date (“Letter of Credit Expiration Date”), subject~~ prior to ~~the last paragraph of this Article 27, provide that~~ the expiration date of the Letter of Credit ~~shall be no earlier than the Letter of Credit Termination Date~~ or ~~provide for automatic~~ any renewal ~~thereof at least through the Letter of Credit Expiration Date~~or extension thereof, ~~unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-~~a renewal ~~by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G,~~ or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least thirty (30) days prior to the expiration extension of the Letter of Credit ~~without any action whatsoever on the part~~ for a term of ~~Landlord~~not less than one year; (c) ~~subject to~~ Receipt of notice from the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to Bank that it will not be extending the ~~foregoing, the form and~~ terms of the Letter of Credit ~~(and~~ or otherwise intends to terminate the ~~bank issuing~~ Letter of Credit prior to expiration of the ~~same) shall be~~ Term of this Lease, unless Tenant provides a substitute Letter of Credit from another financial institution acceptable to ~~Landlord~~Landlord in its sole discretion at least ten (10) business days prior to the termination of the existing Letter of Credit; or 42.2 In addition to the circumstances enumerated in Section 42.1(a)-(c) above, inclusive, if the Bank shall admit in ~~Landlord’s reasonable discretion~~writing its inability to pay its debts generally as they become due, ~~and shall provide~~file a petition in bankruptcy or a petition to take advantage of any insolvency act, ~~among other things~~make an assignment for the benefit of its creditors, ~~in effect that: (i) Landlord~~consent to the appointment of a receiver of itself or of the whole or any substantial part of its property, or ~~its then managing agent~~file a petition or answer seeking reorganization or arrangement under the Federal bankruptcy laws or any other applicable law or statute of the United States of America or any state thereof (each of the foregoing, a “Bank Insolvency”), Landlord shall have the right to draw ~~down an amount up to the face amount of the Letter of Credit~~ upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, ~~in whole~~ and whether or ~~in part~~ not Landlord elects to draw thereon, Tenant shall obtain a replacement Letter of Credit within thirty (30) days of such event of Bank Insolvency from another Issuer satisfying the requirements of subsection (a) above. 42.3 Proceeds of any draw upon the Letter of Credit may be applied by Landlord to the ~~transferee~~ payment of accrued and ~~thereupon~~ unpaid rent, additional rent, interest, late charges, or any other obligation arising out of Tenant’s obligations to Landlord under this Lease, in such manner as Landlord in its sole discretion, deems appropriate; provided, however, that in the event that Landlord ~~shall, without~~ draws proceeds on the Letter of Credit in excess of any ~~further agreement between the parties, be released~~ amounts owed by Tenant ~~from all liability therefor~~to Landlord under this Lease (“Excess Proceeds”), ~~and it is agreed that the provisions hereof~~ then such Excess Proceeds shall ~~apply to every transfer or assignment~~ be held as a Security Deposit in accordance with Section 5 of the ~~whole~~ Lease. Provided there is no default or ~~any portion~~ condition which but for the furnishing of ~~said~~ notice or the passage of time would constitute an Event of Default under this Lease, Landlord shall release its rights in the Letter of Credit and surrender the Letter of Credit to ~~a new landlord. If, as a result of any application or use by Landlord~~ the Bank upon payment in full of all ~~or any part~~ sums due under this Lease. Landlord shall have sole authority and discretion to draw under the Letter of Credit in accordance with the terms of this Lease and the Letter of Credit. Within thirty (30) days after any such draw, Tenant shall reinstate the amount available under the Letter of Credit to the required amount as provided herein. In the event that Landlord draws on the Letter of Credit in violation of the terms and conditions of this Lease, and if Landlord fails to return such improperly drawn amount to Tenant within thirty (30) days after receipt of written demand from Tenant, then, in addition to all of Tenant’s other rights and remedies for such default by Landlord, Tenant may xxxxx Rent otherwise due under the Lease until the amount so improperly drawn has been fully recovered by Tenant. 42.4 So long as there is then no uncured Event of Default by Tenant under the Lease, beginning in the 25th month of the Term of the Lease and annually thereafter, the amount of the Letter of Credit shall be ~~less than~~ reduced by $500,000 per year provided that Tenant satisfies the ~~LC Amount~~following financial performance measurements: (a) Tenant’s EBITDA is a minimum of $25,000,000 for the prior calendar year (e.g., ~~Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to~~ assuming the ~~deficiency (or a replacement letter of credit in the total amount~~ 25th month of the ~~LC Amount) and any such additional (or replacement) letter of credit shall comply with all~~ Term begins on January 1, 2019, the calendar year for purposes of the ~~provisions of this Article 27,~~ EBITDA financial performance measurement shall be 2018); and ~~if Xxxxxx fails to comply with~~ (b) Tenant’s cash on hand exceeds $60,000,000. In the event that Tenant satisfies the foregoing ~~terms of this sentence~~financial performance measurements for five consecutive years, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit ~~expires earlier than~~ requirement under this Lease shall terminate. 42.5 In the ~~Lease Expiration Date, Landlord will accept a renewal letter of credit or~~ event Tenant does not elect to substitute ~~letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of~~ the Letter of Credit ~~or amendment), which shall be irrevocable and automatically renewable~~ for $5,000,000 of the Security Deposit as ~~above~~ provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the ~~amount and in accordance with~~ Basic Provisions of the ~~terms set forth in this Article 27~~Lease, ~~Landlord shall have the right to present the Letter~~ then so long as there is then no uncured Event of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default Default by Tenant under ~~this~~ the Lease, beginning in the 25th month of the Term of the Lease ~~pending~~ and annually thereafter, the amount of the Security Deposit shall be reduced by $500,000 per year provided that Tenant satisfies the following financial performance measurements: (a) Tenant’s ~~delivery to Landlord~~ EBITDA is a minimum of $25,000,000 for the prior calendar year (e.g., assuming the 25th month of the ~~required replacement letter of credit in~~ Term begins on January 1, 2019, the ~~LC Amount and otherwise complying with all~~ calendar year for purposes of the ~~provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord~~ EBITDA financial performance measurement shall be ~~returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord~~ 2018); and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from (b) Tenant’s ~~default~~cash on hand exceeds $60,000,000. In the event that Tenant satisfies the foregoing financial performance measurements for five consecutive years, ~~as may be permitted by~~ the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease Security Deposit amount shall be ~~deemed~~ reduced to ~~render the Letter~~ $423,712.50. RECORDING REQUESTED BY AND WHEN RECORDED RETURN TO: XXXXXXXX, PATCH, XXXXX & BASS, LLP Xxx Xxxxxxxxxx Xxxxxx, Suite 3000 San Francisco, California 94104 Attention: Xxxxxxx X. Xxxxx, Esq. SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT 1. HILL 7 DEVELOPERS, LLC, a Delaware limited liability company 1. REDFIN CORPORATION, a Delaware corporation 1. THE UNION LABOR LIFE INSURANCE COMPANY, a Maryland corporation, on behalf of ~~Credit conditional to justify the issuer~~ its Separate Account J Abbreviated Legal Description: OFFICE UNIT, INCLUDING ALL COMMON ELEMENTS AND LIMITED COMMON ELEMENTS ALLOCATED THERETO, OF HILL7, A CONDOMINIUM, ACCORDING TO DECLARATION RECORDED JULY 5, 2013 UNDER RECORDING NO. 20130705001353, AND AMENDMENT(S) THERETO; SAID UNIT IS LOCATED ON SURVEY MAP AND PLANS FILED IN VOLUME 277 OF CONDOMINIUMS, AT PAGES 000 XXXXXXX 000 XX XXXX XXXXXX, XXXXXXXXXX. Additional legal description is on Exhibit A of ~~the Letter~~ document 066000-1615-06, 066000-1620-09, 066000-1640-05, 066000-1645-00, 066000-1635-02 SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT THIS SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT (this “Agreement”), is made as of ~~Credit in failing to honor~~ , , by and among and REDFIN CORPORATION, a ~~drawing upon such Letter~~ Delaware corporation (“Tenant”), HILL 7 DEVELOPERS, LLC, a Delaware limited liability company (“Landlord”), and THE UNION LABOR LIFE INSURANCE COMPANY, a Maryland corporation, on behalf of ~~Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be:~~ its Separate Account J (~~e) deemed to be or treated as a~~ “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950Lender”).

Appears in 1 contract

Samples: Office Lease (Redfin CORP)

Letter of Credit. ~~Within forty-five (45) days after the mutual~~ with Tenant’s execution ~~and delivery~~ of this Lease, Tenant shall deliver to Landlord, as collateral for the full ~~and faithful~~ performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease, ~~an irrevocable and unconditional negotiable~~ a standby, unconditional, irrevocable, transferable letter of credit (the “Letter of Credit”~~), substantially~~ ) in accordance with the ~~form~~ requirements set forth in Exhibit F attached ~~as Exhibit G~~ hereto ~~and made a part hereof,~~ and containing the terms required herein, ~~payable~~ in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial face amount of Two Million Three Hundred Eighty-Three Thousand Eight Hundred Twenty-Five and 00/100 Dollars ($~~[***]~~ 2,383,825.00) (~~“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from~~ the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a) at sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is sixty (60) days following the Termination Date (“Letter of Credit Amount”), naming Landlord as beneficiary, issued (or confirmed) by a financial institution acceptable to Landlord in Landlord’s sole discretion, permitting multiple and partial draws thereon, and otherwise in form acceptable to Landlord in its sole discretion. Tenant shall cause the Letter of Credit to be continuously maintained in effect (whether through replacement, renewal or extension) in the Letter of Credit Amount through the date (the “Final LC Expiration Date”~~), subject to~~ ) that is ninety (90) days after the ~~last paragraph of this Article 27, provide that the~~ scheduled expiration date of the ~~Letter of Credit shall be no earlier than~~ Lease Term or any Extension Term. If the Letter of Credit ~~Termination~~ held by Landlord expires earlier than the Final LC Expiration Date (whether by reason of a stated expiration date or ~~provide for automatic renewal thereof at least through the Letter~~ a notice of ~~Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such~~ termination or non-renewal given by ~~certified mail, return receipt requested at~~ the ~~address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event~~issuing bank), Tenant shall deliver a new Letter of Credit or certificate of renewal or extension to Landlord at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration date of the Letter of Credit then held by Landlord. Any renewal or ~~amendment)~~replacement Letter of Credit shall comply with all of the provisions of this Section 6.20 and the requirements set forth in Exhibit F attached hereto, ~~which~~ shall be ~~irrevocable~~ irrevocable, transferable and shall remain in effect (or be automatically ~~renewable as above provided~~ renewable) through the ~~Lease~~ Final LC Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its ~~reasonable~~ sole discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Gross Lease (Akcea Therapeutics, Inc.)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after~~ Section 36.A of the ~~mutual~~ Lease is hereby replaced with the following: A. Tenant will deliver to Landlord contemporaneously with Tenant’s execution and delivery of this ~~Lease, Tenant shall deliver to Landlord, as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease,~~ Lease an irrevocable ~~and unconditional negotiable~~ letter of credit payable in Somerset, New Jersey, in the amount of the required Security Deposit set forth in Section 1.G of this Lease (subject to reduction as set forth in Section 36.F), issued for the benefit of the Landlord by a bank reasonably satisfactory to Landlord (the “~~Letter~~ Issuing Bank”) which: (i) has an A.M. Best Bank Deposit Rating of ~~Credit”~~“a” or better; (ii) has a Standard & Poors Bank Survivability Assessment Rating of “A” or better; and (iii) has a Mxxxx’x Bank Financial Strength Rating of” B+” or better, in each case without qualification by “-” or other reduction or negative qualification of such rating); provided, ~~substantially in~~ however, that Landlord approves UMB Bank, N.A. as the ~~form attached~~ Issuing Bank so long as ~~Exhibit G hereto and made~~ it maintains a ~~part hereof~~Fitch short-term Issuer Default Rating of at least F1, and ~~containing~~ a Standard & Poor short-term counterparty credit rating of at least A-2 (collectively, the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“~~LC Amount~~L/C Issuer Requirements”). Notwithstanding that the Issuing Bank may have met the L/C Issuer Requirements upon issuance of the letter of credit, if, during the Lease Term, the Issuing Bank fails to meet the L/C Issuer Requirements, or if the Issuing Bank enters into any form of regulatory or governmental receivership or other similar regulatory or governmental proceeding including, without limitation, any receivership instituted or commenced by the Federal Deposit Insurance Corporation (FDIC) or is otherwise declared insolvent or downgraded by the FDIC or put on an FDIC “watchlist,” or if the financial condition of the Issuing Bank changes in any other materially adverse way, as reasonably determined by Landlord, then Tenant shall ~~provide~~ within 10 days after written notice from Landlord ~~with~~ deliver to Landlord a ~~specimen Letter~~ replacement letter of ~~Credit from~~ credit which meets the ~~approved issuer prior~~ requirements of this Section 36 and issued by an Issuing Bank meeting the L/C Issuer Requirements; Tenant’s failure to do so will, notwithstanding anything in this Lease to the ~~execution~~ contrary, constitute an Event of ~~this Lease~~Default for which there will be no notice or grace or cure period applicable thereto (other than the aforesaid 10-day period), and will give Landlord the immediate right, without further notice to Tenant, to draw upon such letter of credit. ~~The Letter~~ If Tenant replaces such letter of ~~Credit shall be: (a) at sight and irrevocable; (b) maintained in effect~~ credit pursuant to the foregoing, Landlord will, within 30 days after Landlord’s receipt of the replacement letter of credit, deliver to Tenant the letter of credit so replaced. Each letter of credit will be irrevocable for the ~~entire~~ term of such letter of credit and will provide that it is automatically renewable for a period ~~from~~ ending not earlier than 60 days after the ~~date~~ expiration of ~~execution~~ the Lease Term (the “Final L/C Expiration Date”) without any action whatsoever on the part of ~~this Lease~~ Landlord. However, the Issuing Bank will have the right not to renew said letter of credit on written notice to Landlord given not less than 60 days before the expiration of the then current term thereof (it being understood, however, that the privilege of the Issuing Bank not to renew said letter of credit will not, in any event, diminish the obligation of Tenant to maintain such irrevocable letter of credit with Landlord through the date which is sixty (60) days ~~following the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that~~ after the expiration ~~date~~ of the ~~Letter~~ Lease Term). Tenant must be the applicant of ~~Credit shall be~~ the letter of credit. (b) On the condition that no ~~earlier than~~ Event of Default then exists and no condition exists which, with the ~~Letter~~ giving of ~~Credit Termination Date~~ notice or ~~provide for automatic renewal thereof at least through~~ passage of time of both, would constitute an Event of Default, as of March 1, 2014, Landlord will permit the ~~Letter~~ required amount of ~~Credit Expiration Date, unless~~ the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new required Letter of Credit to ~~Landlord at least thirty (30) days prior~~ be reduced beginning on March 1, 2014 to ~~the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices~~ $10,185. Tenant will have sole responsibility for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, causing the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and reduced in accordance with this Section. Landlord agrees to cooperate with Tenant to achieve such reduction, subject to the terms and conditions as set forth in this Article 27, Landlord shall have the right to present the Letter of Credit to the issuing bank in accordance with the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950Section.

Appears in 1 contract

Samples: Lease (Management Network Group Inc)

Letter of Credit. ~~Within forty-five~~ 35.1 Tenant acknowledges that Landlord has advised Tenant that Pacific Coast Capital Funding, LLC (45collectively, with its successors and assigns, “PCCF”), is providing a loan (the “Loan”) to Landlord for Landlord’s acquisition of the Lot, the Building and the Premises. The Loan will be secured by a deed of trust to be recorded against the Lot and the Building, which deed of trust, along with all other documents between PCCF and Landlord concerning the Loan, are collectively referred to as the “Loan Documents”. Tenant further acknowledges that, as required by the Loan Documents, (X) Landlord has assigned to PCCF its rights and interests in and to this Lease and the Rent, as security for repayment of the Loan and (Y) PCCF shall be the named Beneficiary of the Letter of Credit (defined below). Three (3) business days ~~after~~ prior to the ~~mutual execution and delivery of this Lease~~Anticipated Commencement Date, Tenant shall deliver to ~~Landlord~~Landlord (for the benefit of and delivery to PCCF), as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord and/or PCCF (solely as assignee of Landlord’s interest in this Lease) may suffer as a result of any default by Tenant of this Lease, an irrevocable and unconditional negotiable standby letter of credit (the “Letter of Credit”), ~~substantially~~ in the form ~~attached as Exhibit G hereto and made a part hereof,~~ and containing the terms required herein, payable in ~~the State of~~ Santa Xxxxx County, California, running in favor of ~~Landlord,~~ PCCF issued by a solvent nationally recognized bank ~~reasonably approved by Landlord~~ or financial institution, under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the ~~initial~~ amount of Six Hundred Twelve Thousand Dollars ($~~[***]~~ 612,000) (the “LC Amount”). ~~Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease.~~ The Letter of Credit shall ~~be:~~ be (ai) at sight and ~~irrevocable;~~ irrevocable and unconditional, (bii) subject to the terms of this Section 35, maintained in ~~effect~~ effect, whether through replacement, renewal or extension, for the ~~entire~~ period from the ~~date~~ Commencement Date of ~~execution of this~~ the Lease ~~through~~ and continuing until the date which is ~~sixty~~ thirty (6030) days ~~following~~ after the ~~Termination~~ Expiration Date of the Lease (the “Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, and Tenant shall deliver a new Letter of Credit or certificate of renewal or extension to ~~Landlord~~ Landlord, for the benefit of PCCF, at least thirty (30) days prior to the expiration of the Letter of Credit then held by PCCF, without any action whatsoever on the part of ~~Landlord;~~ Landlord or PCCF, (ciii) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #~~600; and~~ 500, (div) fully assignable by ~~Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer),~~ PCCF and permit partial draws~~. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION~~. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the ~~same~~same (the “Bank”) shall be acceptable to ~~Landlord~~PCCF, in ~~Landlord~~PCCF’s reasonable discretion, and shall provide, among other things, in effect that: : (iA) ~~Landlord~~PCCF, or its then ~~managing~~ authorized agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the ~~issuing bank~~ Bank of ~~Landlord~~PCCF’s (or ~~Landlord~~PCCF’s ~~then managing~~ authorized agent’s) ~~written~~ statement that (1) such amount is due to Landlord ~~is entitled to make such drawing~~ under the terms and conditions of this Lease, (2) Tenant has filed a voluntary petition under the Federal Bankruptcy Code or (3) an involuntary petition has been filed against Tenant under the Federal Bankruptcy code, it being understood that if ~~Landlord~~ PCCF or its ~~managing~~ authorized agent be a limited liability company, corporation, partnership or other entity, then such statement shall be signed by a managing member (if a limited liability company) an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); ; (iiB) the Letter of Credit will be honored by the ~~issuing bank~~ Bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; ~~and~~ and (~~iii~~C) in the event of a transfer of Landlord’s interest in the ~~Building~~Building and/or Landlord has unconditionally paid the Loan in full (as applicable), ~~Landlord~~ PCCF shall transfer the Letter of ~~Credit~~Credit (or cause a substitute letter of credit to be delivered, ~~in whole or in part~~ as applicable), to the transferee as directed by Landlord and thereupon ~~the~~ Landlord and PCCF shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to such transferee or successor-in-interest to Landlord, as the case may be. 35.2 Tenant hereby acknowledges and agrees that (i) Landlord is entering into this Lease in material reliance upon the ability of PCCF to draw upon the Letter of Credit upon the occurrence of any default on the part of Tenant hereunder, and (ii) PCCF provided the Loan to Landlord in material reliance upon the ability of PCCF to draw upon the Letter of Credit upon the occurrence of any default on the part of Tenant hereunder. Tenant further acknowledges and agrees that if PCCF cannot draw upon the Letter of Credit within the times and in the manner as anticipated by PCCF herein, Landlord and PCCF shall suffer irreparable damage, harm and injury. From time to time during the Term of this Lease it is anticipated by the parties that the Letter of Credit will need to be amended, modified and, possibly reissued. Landlord and Tenant hereby covenant and agree to cooperate with one another to promptly effectuate any such commercially reasonable amendments, modifications and new issuances, including without limitation, executing and submitting to the Bank any and all documents or instruments as may be reasonably required to effectuate same. Each and every time during the Term of this Lease there is a ~~new landlord~~change in the identity or address of the parties, including without limitation, any change in the identity of Landlord or PCCF due to (A) the sale, transfer or other conveyance by Landlord of its rights and interests in, to and under this Lease to any other party, person or entity, (B) the payoff or refinance of the Loan by Landlord, or (C) the assignment or transfer by PCCF of its rights and interests in, to and under the Loan, as applicable, the Letter of Credit shall immediately be amended or reissued to reflect such changes and the parties hereby agree to execute and submit to the Bank such further applications, documents and instruments as may be reasonably necessary to effectuate same. It is the intention of the parties that each and every successor and assign of each of Landlord, PCCF and Tenant be bound by and subject to the terms and provisions of this Section 35. PCCF may, at any time and without notice to Tenant and without first obtaining Tenant’s consent thereto, assign all or any portion of its interest in and to the Letter of Credit to another party, person or entity, regardless of whether or not such assignment is separate from or as a part of the assignment by Landlord or PCCF, as applicable, of its rights and interests in and to this Lease. 35.3 If, as a result of any such application or use ~~by Landlord~~ of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ~~ten~~ five (105) ~~business~~ days thereafter, provide Landlord (for PCCF’s benefit) with an additional letter(s) of ~~credit,~~ credit in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this ~~Article 27~~Section 35, and if ~~Xxxxxx~~ Tenant fails to comply with the ~~foregoing terms of this sentence~~foregoing, notwithstanding anything to the contrary contained in Section 18 hereof, the same shall constitute an ~~uncurable~~ incurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of ~~Credit,~~ Credit or any part thereof and that neither Landlord or PCCF nor ~~its~~ any of their respective successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the ~~Lease~~ Letter of Credit Expiration Date, Landlord (for PCCF’s benefit) will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect ~~and delivered to Landlord, as applicable,~~ not later than thirty (30) days prior to the expiration of the Letter of ~~Credit or amendment~~Credit), which shall be irrevocable and automatically renewable as above provided through the ~~Lease~~ Letter of Credit Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord and PCCF, in ~~its reasonable~~ their sole discretion. However, if the Letter of Credit is not timely renewed or a substitute ~~or amendment to~~ letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this ~~Article 27~~Section 35, ~~Landlord~~ PCCF shall have the right to present the Letter of Credit to the ~~issuing bank~~ Bank in accordance with the terms of this ~~Article 27~~Section 35, and the ~~entire sum evidenced thereby shall~~ proceeds of the Letter of Credit may be ~~paid to and held~~ applied by ~~Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations~~ PCCF against any Rent payable by Tenant under this Lease ~~and~~ that is not paid when due and/or to pay for all losses and damages that Landlord ~~may~~ and/or PCCF (solely as assignee of Landlord’s interest in this Lease) has suffered or that Landlord and/or PCCF (solely as assignee of Landlord’s interest in this Lease) reasonably estimates that it will suffer as a result of any default by Tenant under this Lease. Any unused proceeds need not be segregated from Landlord’s or PCCF’s other assets. Landlord agrees to cause PCCF to pay to Tenant within thirty (30) days after the Letter of Credit Expiration Date the amount of any proceeds of the Letter of Credit received by Landlord or PCCF and not applied against any Rent payable by Tenant under this Lease ~~pending~~ that was not paid when due or used to pay for any losses and/or damages suffered by Landlord or PCCF ) solely as assignee of Landlord’s interest in this Lease) (or reasonably estimated by Landlord or PCCF, solely as assignee of Landlord’s interest in this Lease, that it will suffer) as a result of any default by Tenant under this Lease; provided, however, that if prior to the Letter of Credit Expiration Date, a voluntary petition is filed by Tenant, or an involuntary petition is filed against Tenant by any of Tenant’s ~~delivery to Landlord of~~ creditors, under the ~~required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit~~Federal Bankruptcy Code, ~~any Cash Collateral held by~~ then neither PCCF nor Landlord shall be ~~returned~~ obligated to make such payment in the amount of the unused Letter of Credit proceeds until either all preference issues relating to payments under this Lease have been resolved in such bankruptcy or reorganization case or such bankruptcy or reorganization case has been dismissed. In the event that PCCF draws upon the Letter of Credit solely due to Tenant’s failure to renew the Letter of Credit at least thirty (30) days before its expiration, such failure to renew shall not constitute a default hereunder so long as (i) no other event of default occurs hereunder beyond applicable notice and cure periods and (ii) Tenant renews the Letter of Credit before the actual expiration date of the Letter of Credit. Provided Tenant is not in default of its obligations under this Lease, upon receipt of a replacement Letter of Credit that satisfies the requirements hereunder, Landlord or PCCF, as applicable, shall ~~have~~ return the ~~right~~ cash proceeds of the original Letter of Credit drawn by PCCF minus any amounts necessary to ~~hold Cash Collateral in a deposit account in the name~~ compensate Landlord or PCCF (solely as assignee of ~~Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security~~ Landlord’s interest in this Lease) for any past due Rent, damages, costs, expenses or attorneys’ fees incurred hereunder related to Tenant’s failure to timely replenish the ~~Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral.~~ Letter of Credit. 35.4 If there shall occur a default ~~under the~~ of this Lease ~~beyond all applicable notice and cure periods~~as set forth in Section 18 of this Lease, ~~Landlord~~ PCCF may, but without obligation to do so, and without notice draw upon the Letter of ~~Credit and/or utilize the Cash Collateral~~Credit, in part or in whole, to the extent ~~necessary~~ required to cure any default of Tenant and/or to compensate Landlord or PCCF (as applicable and with respect to PCCF, solely as assignee of Landlord’s interest in this Lease) for any and all damages of any kind or nature sustained or which may be sustained by Landlord or PCCF to the extent resulting from Tenant’s default~~, as may be permitted by the express terms and conditions of this Lease~~. ~~Xxxxxx~~ Tenant agrees not to interfere in any way with payment to ~~Landlord~~ PCCF of the proceeds of the Letter of Credit, either prior to or following a “draw” by ~~Landlord~~ PCCF of any portion of the Letter of Credit, ~~[***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION.~~ regardless of whether any dispute exists between ~~Xxxxxx~~ Tenant and Landlord as to ~~Landlord~~PCCF’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Subject to the provisions of this Section 35, from the Commencement Date through the Letter of Credit Expiration Date, Tenant agrees and acknowledges that it has no property interest whatsoever in the Letter of Credit or the proceeds thereof and that, in the event Tenant becomes a debtor under any chapter of the Federal Bankruptcy Code, neither Tenant, any trustee, nor Tenant’s bankruptcy estate shall have any right to restrict or limit Landlord’s claim and/or rights to the Letter of Credit and/or the proceeds thereof by application of Section 502(b)(6) of the Federal Bankruptcy Code. 35.5 Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor ~~or Cash Collateral be:~~ be (ex) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section ~~1950.7;~~ 1950.7 (fas supplemented, amended, replaced and substituted from time to time), (y) subject to the terms of such Section ~~1950.7; or~~ 1950.7 (gas supplemented, amended, replaced and substituted from time to time), or (z) intended to serve as a “security deposit” within the meaning of such Section ~~1950~~1950.7 (as supplemented, amended, replaced and substituted from time to time). The parties hereto (a) recite that the Letter of Credit is not intended to serve as a security deposit and such Section 1950.7 (as supplemented, amended, replaced and substituted from time to time), and any and all other laws, rules and regulations applicable to security deposits in the commercial context (“Security Deposit Laws”) shall have no applicability or relevancy thereto and (b) waive any and all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit Laws. 35.6 So long as Tenant has not at any time been, or is currently not in default of this Lease beyond any applicable notice and cure periods: (i) if at any time following the second (2nd) year of the Term of this Lease, Tenant has three (3) consecutive fiscal quarters of positive net cash flow (as reported in Tenant’s audited annual financial statements as prepared by a certified public accountant), then the face amount of the Letter of Credit shall decline to Three Hundred Six Thousand Dollars ($306,000.00) (the “Initial LC Reduction”), and (ii) following the Initial LC Reduction, if Tenant has two (2) consecutive fiscal quarters of positive net cash flow in excess of Four Million Dollars ($4,000,000.00) per quarter (as reported in Tenant’s audited annual financial statements as prepared by a certified public accountant), then the face amount of the Letter of Credit shall decline to One Hundred Fifty-three Thousand Dollars ($153,000.00). Such reductions of the face amount of the Letter of Credit shall be effectuated by amending the Letter of Credit and the parties hereby agree to execute and submit to the Bank such applications, documents and instruments as may be necessary to effectuate same. In addition to the foregoing, each and every time during the Term of this Lease there is a change in the identity or address of the parties, including without limitation, any change in the identity of (a) Landlord due to the sale, transfer or other conveyance by Landlord of its rights and interests in, to and under this Lease to any other party, person or entity, or (b) Landlord’s lender due to the payoff or refinance of the Loan, or (c) PCCF due to the sale or other conveyance of the Loan by PCCF, the Letter of Credit shall immediately be amended to reflect such changes and the parties hereby agree to execute and submit to the Bank such applications, documents and instruments as may be necessary to effectuate same.

Appears in 1 contract

Samples: Lease Agreement (Infinera Corp)

Letter of Credit. ~~Within forty-five (45) days after~~ The Deposit may be in the ~~mutual~~ form of a letter of credit. In such event, Xxxxxx, simultaneously with the execution ~~and delivery~~ of this Lease, ~~Tenant~~ shall deliver to Landlord (as beneficiary), and a copy to Landlord’s attorney, ~~as collateral for the full and faithful performance by Tenant of all of its obligations under this Lease, an irrevocable and unconditional negotiable~~ a standby letter of ~~credit~~ credit, in form and content satisfactory to Landlord (~~the~~ “Letter of Credit”), substantially in the form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be, among other things: (a) ~~at sight and irrevocable~~subject to International Standby Practices 1998, International Chamber of Commerce Publication No. 590; (b) ~~maintained~~ irrevocable and unconditional; (c) in ~~effect~~ the amount of the required Deposit; (d) conditioned for payment solely upon presentation of the Letter of Credit and a sight draft certifying to the issuer of the Letter of Credit the existence of such grounds or circumstances upon which Landlord is permitted to make such draw, and (e) transferable one or more times by Landlord without the consent of Tenant. Tenant acknowledges and agrees that it shall pay upon Landlord’s demand, as Additional Rent, any and all costs or fees charged in connection with the Letter of Credit that arise due to: (i) Landlord’s sale or transfer of all or a portion of the Property, or (ii) the addition, deletion, or modification of any beneficiaries under the Letter of Credit. The Letter of Credit shall be issued by a member of the New York Clearing House Association or a commercial bank or trust company satisfactory to Landlord possessing a net worth reasonably acceptable to Landlord. Landlord hereby approves of Silicon Valley Bank (“SVB”) as an issuing bank for the ~~entire period~~ Letter of Credit provided and for so long as SVB maintains a minimum star rating of “Green/One Star” as determined from time to time by VERIBANC (the “Minimum Rating”). In the event SVB falls below the Minimum Rating, Xxxxxx agrees, promptly upon notice from Landlord, to deliver a substitute Letter of Credit to Landlord from an issuing bank reasonably satisfactory to Landlord. The Letter of Credit shall expire not earlier than twelve (12) months after the date of ~~execution of this Lease~~ delivery thereof to Landlord and shall provide that same shall be automatically renewed for successive twelve (12) month periods through ~~the~~ a date which is not earlier than sixty (60) days ~~following~~ after the Termination Date (“Letter of Credit Expiration Date”), subject to the last paragraph of this Article 27, provide that the expiration date of the Letter of Credit shall be no earlier than the Letter of Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date, or any renewal or extension thereof, unless written notice of non-renewal has been given by the issuing bank ~~provides at least thirty (30) days prior written notice~~ to Landlord ~~of such non-renewal~~ and Landlord’s attorney by registered or certified mail, return receipt ~~requested at~~ requested, not less than sixty (60) days prior to the ~~address set forth on~~ expiration of the ~~form~~ current period. If the issuing bank does not renew the Letter of Credit, and if Tenant does not deliver a substitute Letter of Credit ~~attached as Exhibit G,~~ or cash in ~~such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord~~ lieu thereof at least thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord current period, then in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing rights granted under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part of the Letter of Credit, the amount of the Letter of Credit shall be less than the LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to ~~present~~ draw on the existing Letter of Credit ~~to the issuing bank in accordance with the terms of this Article 27,~~ and the entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer maintain such funds as a ~~result of any default by Tenant under this Lease pending Tenant’s delivery~~ cash security deposit. With respect to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned draws on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, either prior to or following a “draw” by Landlord of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950.

Appears in 1 contract

Samples: Office Lease (Fitbit Inc)

Letter of Credit. ~~Within forty-five~~ (45a) ~~days after the mutual execution and delivery~~ In lieu of ~~this Lease~~a cash Security Deposit, Tenant ~~shall~~ may deliver to ~~Landlord, as collateral for the full and faithful performance by Tenant~~ Landlord an Irrevocable Standby Letter of ~~all of its obligations under this Lease, an irrevocable and unconditional negotiable letter of credit~~ Credit (the “Letter of Credit”). If Tenant has already provided Landlord with a cash Security Deposit, ~~substantially in~~ Tenant may replace that with a Letter of Credit meeting the ~~form attached as Exhibit G hereto and made a part~~ requirements hereof, and ~~containing~~ upon receipt of such Letter of Credit, Landlord shall return the ~~terms required herein~~cash Security Deposit which it is then holding to Tenant. Alternatively, ~~payable in~~ Tenant may provide the State of California, running in favor of Landlord, issued by a solvent bank reasonably approved by Landlord under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association, in the initial amount of $[***] (“LC Amount”). Tenant shall provide Landlord with a specimen Letter of Credit ~~from~~ in lieu of a cash Security Deposit on the ~~approved issuer prior~~ date that Tenant executes and delivers this Lease to ~~the execution of this Lease~~Landlord. The Letter of Credit shall ~~be:~~ be (a1) ~~at sight and irrevocable;~~ in the form attached hereto as Exhibit 6, with such changes thereto as may be reasonably acceptable to Landlord, (b2) ~~maintained~~ issued by a bank approved in ~~effect for the entire period~~ writing by Landlord with an investment grade credit rating from ~~the date~~ Xxxxx’x (i.e., a rating of ~~execution~~ Baa3 or above), S&P (i.e., a rating of ~~this Lease through the date which is sixty~~ BBB- or above), or Fitch (60i.e., a rating of BBB- or above) ~~days following the Termination Date~~ (an “~~Letter of Credit Expiration Date~~Acceptable Bank”), (3) upon which presentment may be made in Boston, MA, Washington, DC, or elsewhere in the continental United States if presentation may be made by overnight courier (e.g., Federal Express), (4) in the amount set forth in Exhibit 1, and (5) for a term of at least one (1) year, subject to automatic extension in accordance with the ~~last paragraph~~ terms of ~~this Article 27, provide that~~ the ~~expiration date~~ Letter of Credit. If the issuer of the Letter of Credit ceases to qualify as an Acceptable Bank or becomes subject to insolvency or receivership proceedings of any sort, Tenant shall be ~~no earlier than~~ required to deliver a substitute Letter of Credit satisfying the conditions hereof (the “Substitute Letter of Credit”) within fifteen (15) business days after notice thereof from Landlord. If the issuer of the Letter of Credit ~~Termination Date or provide for automatic renewal thereof at least through the~~ gives notice of its election not to renew such Letter of Credit ~~Expiration Date~~for any additional period, ~~unless the issuing bank provides at least thirty (30) days prior written notice~~ Tenant shall be required to ~~Landlord of such non-renewal by certified mail, return receipt requested at the address set forth on the form of~~ deliver a Substitute Letter of Credit ~~attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord~~ at least thirty (30) days prior to the expiration of the term of such Letter of Credit. If Tenant fails to furnish such renewal or replacement by the applicable deadline set forth above, Landlord may draw upon such Letter of Credit ~~without any action whatsoever on~~ and hold the ~~part of Landlord;~~ proceeds thereof (cthe “Security Proceeds”) ~~subject~~ as a cash Security Deposit pursuant to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of ~~the Letter of Credit (and the bank issuing the same)~~ Section 7. 1. Tenant agrees that it shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer maintain the Letter of Credit, in ~~whole~~ the full amount required hereunder, in effect until a date which is at least sixty (60) days after the Termination Date of this Lease. Tenant’s failure to maintain or ~~in part to~~ replace the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit ~~to a new landlord. If,~~ as required hereunder shall be treated as a ~~result~~ failure to pay rent for purposes of Landlord’s remedies. (b) If Tenant is in default of its obligations under this Lease, then Landlord shall have the right, at any ~~application~~ time after such event, without giving any further notice to Tenant, to draw down from the Letter of Credit (or ~~use by Landlord~~ Substitute Letter of ~~all~~ Credit or ~~any part of the~~ Additional Letter of Credit, as defined below, as the case may be) (i) the amount necessary to cure such default or (ii) if such default cannot reasonably be cured by the expenditure of money, the amount which, in Landlord’s opinion, is necessary to satisfy Tenant’s liability in account thereof. In the event of any such draw by Landlord, Tenant shall, within fifteen (15) business days of written demand therefor, deliver to Landlord an additional Letter of Credit satisfying the foregoing conditions (the “Additional Letter of Credit”), except that the amount of ~~the~~ such Additional Letter of Credit shall be ~~less than~~ the ~~LC Amount, Tenant shall, within ten (10) business days thereafter, provide Landlord with an additional letter(s)~~ amount of ~~credit~~such draw. In addition, in ~~an amount equal to~~ the ~~deficiency (~~event of a termination based upon the default of Tenant under this Lease, or a ~~replacement letter~~ rejection of ~~credit in the total amount of the LC Amount) and any such additional (or replacement) letter of credit shall comply with all of~~ this Lease pursuant to the provisions of ~~this Article 27, and if Xxxxxx fails to comply with~~ the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if the Letter of Credit expires earlier than the Lease Expiration Date, Landlord will accept a renewal letter of credit or substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit or amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as may be acceptable to Landlord in its reasonable discretion. However, if the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27Federal Bankruptcy Code, Landlord shall have the right to ~~present~~ draw upon the Letter of Credit (from time to time, if necessary) to cover the full amount of damages and other amounts due from Tenant to Landlord under this Lease. Any amounts so drawn shall, at Landlord’s election, be applied first to any unpaid rent and other charges which were due prior to the ~~issuing bank in accordance~~ filing of the petition for protection under the Federal Bankruptcy Code. Tenant hereby covenants and agrees not to oppose, contest or otherwise interfere with ~~the terms of this Article 27, and the entire sum evidenced thereby shall be paid to and held~~ any attempt by Landlord ~~as cash (the “Cash Collateral”)~~ to ~~be held as collateral for performance~~ draw down from said Letter of ~~all~~ Credit including, without limitation, by commencing an action seeking to enjoin or restrain Landlord from drawing upon said Letter of ~~Tenant’s~~ Credit. Tenant also hereby expressly waives any right or claim it may have to seek such equitable relief. In addition to whatever other rights and remedies Landlord may have against Tenant if Tenant breaches its obligations under this ~~Lease~~ paragraph, Tenant hereby acknowledges that it shall be liable for any and ~~for~~ all ~~losses and~~ damages which Landlord may suffer as a result of any ~~default by~~ such breach. (c) Upon request of Landlord, Tenant ~~under this Lease pending Tenant’s delivery~~ shall, at its expense, cooperate with Landlord in obtaining an amendment to or replacement of any Letter of Credit which Landlord is then holding so that the amended or new Letter of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in Credit reflects the name of ~~Landlord and commingle~~ any new owner of the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to Building. (d) To the extent ~~necessary to cure~~ that Landlord has not previously drawn upon any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds of the Letter of Credit, ~~either prior to or following a “draw” by Landlord of any portion of the~~ Substitute Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw from the Letter of Credit. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional to justify the issuer of the Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the Additional Letter of Credit or Security Proceeds (collectively, the “Collateral”) held by Landlord, Landlord shall return such Collateral to Tenant on the expiration of the Term, less any ~~renewal thereof or substitute therefor or Cash Collateral be:~~amounts due from Tenant hereunder. (e) In no event shall the proceeds of any Letter of Credit be deemed to be a prepayment of rent or ~~treated as~~ a ~~“security deposit” within the meaning~~ measure of ~~California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950~~liquidated damages.

Appears in 1 contract

Samples: Lease (Learning Tree International Inc)

Letter of Credit. ~~Within forty-five (45) days after~~ Landlord and Tenant acknowledge that Tenant will occupy space in the ~~mutual execution and delivery~~ Bank of America Building pursuant to the Lease and, as consideration for Landlord’s willingness to enter into this ~~Lease~~Third Lease Addendum, Tenant shall deliver or cause to be delivered to Landlord, ~~as collateral for~~ and shall cause to be maintained at all times in effect without expiration or termination, one or more irrevocable standby letters of credit complying with the ~~full and faithful performance~~ terms of this Section 9. Any failure by Tenant to perform or observe any term, covenant or agreement set forth in this Section 9 shall constitute a material default under the Lease. Within ten (10) business days of ~~all~~ execution of ~~its obligations under~~ this ~~Lease~~Third Lease Addendum, Tenant shall deliver or cause to be delivered to Landlord an irrevocable ~~and unconditional negotiable~~ standby letter of credit in a form acceptable to or provided by Landlord (the “Letter of Credit”), ~~substantially in~~ issued by a national banking association reasonably acceptable to Landlord, for the ~~form attached as Exhibit G hereto and made a part hereof, and containing the terms required herein, payable in the State~~ account of ~~California, running~~ Tenant in favor of ~~Landlord, issued by a solvent bank reasonably approved by~~ Landlord ~~under the supervision of the Superintendent of Banks of the State of California, or a National Banking Association,~~ in the initial amount of Five Hundred Thirty-three Thousand Four Hundred Eight and 00/100 Dollars ($~~[***]~~ 533,408.00), having an expiry date not earlier than the Expiration Date, and stating by its terms that it shall be automatically extended annually, without written amendment or modification, to the date that is one (~~“LC Amount”). Tenant shall provide Landlord with a specimen~~ 1) year after the then current expiry date unless the issuer of the Letter of Credit ~~from the approved issuer prior to the execution of this Lease. The Letter of Credit shall be: (a)~~ gives Landlord, at ~~sight and irrevocable; (b) maintained in effect for the entire period from the date of execution of this Lease through the date which is~~ least sixty (60) days ~~following~~ prior to the ~~Termination Date (“~~then current expiry date, written notice that the issuer elects not to extend the Letter of ~~Credit Expiration Date”), subject to~~ Credit. If the ~~last paragraph of this Article 27, provide that the expiration date~~ issuer of the Letter of Credit ~~shall be no earlier than~~ at any times gives to Landlord notice that the issuer elects not to extend the Letter of ~~Credit Termination Date or provide for automatic renewal thereof at least through the Letter of Credit Expiration Date~~Credit, ~~unless the issuing bank provides at least thirty (30) days prior written notice to Landlord of such non-renewal by certified mail~~then, return receipt requested at the address set forth on the form of Letter of Credit attached as Exhibit G, or in such form as is otherwise approved by Landlord, in its reasonable discretion, and, in such event, Tenant shall deliver a new Letter of Credit to Landlord at least not less than thirty (30) days prior to the expiration of the Letter of Credit without any action whatsoever on the part of Landlord; (c) subject to the Uniform Customs and Practices for Documentary Credits (1993-Rev) International Chamber of Commerce Publication #600; and (d) fully assignable by Landlord in connection with any number of transfers of Landlord’s interest in this Lease (with Tenant bearing any fees, costs or expenses in connection with any such transfer), and permit partial draws. [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. In addition to the foregoing, the form and terms of the Letter of Credit (and the bank issuing the same) shall be acceptable to Landlord, in Landlord’s reasonable discretion, and shall provide, among other things, in effect that: (i) Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the Letter of Credit upon the presentation to the issuing bank of Landlord’s (or Landlord’s then managing agent’s) written statement that Landlord is entitled to make such drawing under this Lease, it being understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity); (ii) the Letter of Credit will be honored by the issuing bank without inquiry as to the accuracy thereof and regardless of whether the Tenant disputes the content of such statement; and (iii) in the event of a transfer of Landlord’s interest in the Building, Landlord shall transfer the Letter of Credit, in whole or in part to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Letter of Credit to a new landlord. If, as a result of any application or use by Landlord of all or any part current expiry date of the Letter of Credit, Tenant shall deliver or cause to be delivered to Landlord a substitute irrevocable standby letter of credit issued in favor of Landlord by a national banking association reasonably acceptable to Landlord in an amount required by this Section 9. Not less than thirty (30) days prior to the expiry date of any substitute letter of credit delivered pursuant to this Section, Tenant shall deliver or cause to be delivered to Landlord a further substitute irrevocable standby letter of credit issued in favor of Landlord by a national banking association reasonably acceptable to Landlord in an amount required by this Section 9. Each substitute letter of credit delivered pursuant to this Section shall have a term of not less than one (1) year and shall be in a form acceptable to or provided by Landlord. Notwithstanding the foregoing, the initial amount of the Letter of Credit shall be ~~less than~~ reduced as follows during the ~~LC Amount~~Lease Term, provided Tenant has not defaulted under the Lease beyond the applicable notice and cure period: • From and including the 25th month of the Lease Term though and including the 36th month of the Lease Term - $400,056.00; • From and including the 37th month of the Lease Term though and including the 48th month of the Lease Term - $266,704.00; • From and including the 49th month of the Lease Term though and including the 60th month of the Lease Term - $186,693.00; and • From and including the 61st month of the Lease Term though and including the Expiration Date - $80,011.00. Upon the occurrence of any breach or default under the Lease including, but not limited to, any failure by Tenant timely to deliver or cause to be delivered to Landlord any substitute letter of credit required pursuant to this Section 9, Landlord, at its option, may draw against the Letter of Credit and any substitute letter of credit delivered pursuant to this Section 9 in an amount reasonably necessary to cure such breach or default and/or to compensate Landlord for any other loss or damage which Landlord may suffer by reason of Tenant’s breach or default. The Letter of Credit and each substitute letter of credit (also referred to as a “Letter of Credit”) delivered pursuant to this Section 9 shall provide for payment against Landlord’s (or any transferee’s) draft at sight accompanied by a certificate stating substantially as follows: “Drawn under __________ Bank, N.A.’s Irrevocable Standby Letter of Credit No. _____, dated ______________, 2012, as a result of the occurrence of a default under the Lease dated ___________, 2012, between Bellevue Place Office, LLC, a Washington limited liability company, and XXXXXXXXXX.XXX, INC., a Washington corporation. If Landlord draws against the Letter of Credit, Tenant shall, within ten (10) ~~business~~ days ~~thereafter, provide Landlord with an additional letter(s) of credit, in an amount equal to the deficiency (or a replacement letter of credit in the total amount~~ of the ~~LC Amount) and any~~ date of such ~~additional (or replacement) letter of credit shall comply with all of the provisions of this Article 27~~draw, and if Xxxxxx fails to comply with the foregoing terms of this sentence, the same shall constitute an uncurable default by Tenant. Tenant further covenants and warrants that it will neither assign nor encumber the Letter of Credit, or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. Without limiting the generality of the foregoing, if restore the Letter of Credit ~~expires earlier than~~ or provide additional irrevocable standby letters of credit so that, at all times, there shall be an amount required by this Section 9 available for Landlord to draw against in the ~~Lease Expiration Date, Landlord will accept~~ event of any further breach or default under the Lease. If the Letter of Credit is not renewed or Tenant does not provide a ~~renewal~~ substitute irrevocable standby letter of credit on or ~~substitute letter of credit (such renewal or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than~~ before the date that is thirty (30) days prior to the ~~expiration~~ expiry date of the then current Letter of Credit, or in the event Landlord draws against the Letter of Credit, if Tenant does not restore the Letter of Credit or ~~amendment), which shall be irrevocable and automatically renewable as above provided through the Lease Expiration Date upon the same terms as the expiring Letter~~ provide additional letters of ~~Credit or such other terms as may be acceptable~~ credit so that an amount required by this Section 9 is available to Landlord to draw upon in ~~its reasonable discretion. However~~the event of any further breach or default under the Lease, if then in such event the amount of the draw against the Letter of Credit is not timely renewed or a substitute or amendment to letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Article 27, Landlord shall have the right to present the Letter of Credit may be equal to the ~~issuing bank in accordance with the terms of this Article 27, and the~~ entire sum evidenced thereby shall be paid to and held by Landlord as cash (the “Cash Collateral”) to be held as collateral for performance of all of Tenant’s obligations under this Lease and for all losses and damages Landlord may suffer as a result of any default by Tenant under this Lease pending Tenant’s delivery to Landlord of the required replacement letter of credit in the LC Amount and otherwise complying with all of the provisions of this Article 27. Upon delivery of such replacement letter of credit, any Cash Collateral held by Landlord shall be returned to Tenant. Landlord shall have the right to hold Cash Collateral in a deposit account in the name of Landlord and commingle the Cash Collateral with its general assets and Tenant hereby grants Landlord a security interest in the Cash Collateral. Tenant shall not be entitled to any interest earned on the Cash Collateral. If there shall occur a default under the Lease beyond all applicable notice and cure periods, Landlord may, but without obligation to do so, draw upon the Letter of Credit and/or utilize the Cash Collateral, in part or in whole, to the extent necessary to cure any default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained or which may be sustained by Landlord resulting from Tenant’s default, as may be permitted by the express terms and conditions of this Lease. Xxxxxx agrees not to interfere in any way with payment to Landlord of the proceeds amount of the Letter of Credit~~, either prior to or following a “draw” by Landlord~~ . The proceeds of any portion of the Letter of Credit, [***] = CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THIS OMITTED INFORMATION. regardless of whether any dispute exists between Xxxxxx and Landlord as to Landlord’s right to draw ~~from the Letter of Credit. No condition or term of this Lease shall be deemed to render~~ against the Letter of Credit ~~conditional~~ pursuant to ~~justify~~ the ~~issuer~~ immediately preceding sentence shall be held by Landlord as an additional security deposit pursuant to the provisions of Section 8 of the Lease. Upon Landlord’s receipt of the Letter of Credit in ~~failing~~ accordance with this Section 9, Landlord shall credit Tenant’s existing Security Deposit in the amount of $28,249.88 to ~~honor a drawing upon such Letter of Credit in a timely manner. Landlord~~ sums then due and ~~Tenant acknowledge~~ owing, or which may become due and ~~agree that in no event or circumstance shall~~ owing, under the Letter of Credit or any renewal thereof or substitute therefor or Cash Collateral be: (e) deemed to be or treated as a “security deposit” within the meaning of California Civil Code Section 1950.7; (f) subject to the terms of such Section 1950.7; or (g) intended to serve as a “security deposit” within the meaning of such Section 1950Lease.

Appears in 1 contract

Samples: Office Lease (Smartsheet Inc)

Common use of Letter of Credit Clause in Contracts