Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit if: (i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it; (ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied; (iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time; (iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit; (v) any fees due and payable in connection with a requested issuance have not been paid; or (vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit. (b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date. (c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit. (d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit. (e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern. (f) Each Issuer shall: (i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender); (ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and (iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto. (g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto. (h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation. (i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment. (j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of: (i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein; (ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document; (iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction; (iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; (v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and (vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer. (k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower. (l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 4 contracts
Samples: Credit Agreement (Warnaco Group Inc /De/), Credit Agreement (Warnaco Group Inc /De/), Credit Agreement (Warnaco Group Inc /De/)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower (or a Subsidiary of the Borrower) one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and (x) 30 days prior to the Revolving Loan Maturity Credit Termination Date, in the case of a Documentary Letter of Credit and (y) 5 days prior to the Revolving Credit Termination Date, in the case of a Standby Letter of Credit; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v), and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement Closing Date or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement Closing Date and which that such Issuer in good xxxxx xxxxx material to itsuch Issuer;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum aggregate Revolving Credit Commitments in effect at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Dollar Equivalents of the Letter of Credit Undrawn Amounts at such time and (ii) the Dollar Equivalents of the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit; provided, however, that no Issuer shall be required to Issue in its own name, Letters of Credit, denominated in Dollars or an Alternative Currency, for the account of the Borrower, in excess of its Issuer Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(viA) such Letter of Credit is not requested to be denominated in any Alternative Currency and the Issuer receives written notice from the Administrative Agent at or before 11:00 a.m. (New York time) on the date of the proposed Issuance of such Letter of Credit that, immediately after giving effect to the Issuance of such Letter of Credit, all Letter of Credit Obligations at such time in respect of each Letter of Credit denominated in currencies other than Dollars would exceed $5,000,000 or (B) such Letter of Credit is requested to be denominated in any currency other than Dollars or in an Alternative Currency;
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in form and substance reasonably acceptable to it and, if applicable, duly executed by the Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit; or
(vii) the issuance of the Letter of Credit would violate one or more policies of the Issuer applicable to the issuance of letters of credit generally. None of the Revolving Credit Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Revolving Loan Maturity Credit Termination Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (x) on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter of Credit shall have the option to prevent such renewal and (y) neither the Issuer of such Letter of Credit nor the Borrower shall permit any such renewal to extend the expiration date of any Letter of Credit beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount requested (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. whose Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 $500,000 (or such lesser amount as may be mutually agreed to by such between the Borrower and the relevant Issuer)), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. 1:00 p.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Revolving Credit Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 4 contracts
Samples: Credit Agreement (Amc Entertainment Holdings, Inc.), Credit Agreement (Amc Entertainment Holdings, Inc.), Credit Agreement (Amc Entertainment Inc)
Letters of Credit. (a) On Subject to the terms and subject to the conditions contained in of this Annex and of this Agreement, each Agent may from time to time prior to the expiration of the Revolving Period cause the L/C Issuer agrees to Issue one or more issue Standby Letters of Credit at the request of the Borrower for the account of the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity DateBorrower; provided, however, that no Issuer the Lenders shall not issue or to cause to be under issued any obligation Standby Letters of Credit (i) to Issue any the extent that the issuance of such Standby Letters of Credit would then cause the sum of the outstanding Advances and all outstanding Letter of Credit if:
Usage, to exceed the lesser of (ix) any orderthe Maximum Loan Amount, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter and (y) the Availability (with the requested Standby Letters of Credit or any Requirement being deemed to be outstanding for the purposes of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibitcalculating Availability), or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer if a Default or an Event of Default shall have received written notice from the Administrative Agent, any Lender occurred and be continuing or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) would exist after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Standby Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfieddate. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance maximum amount of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and outstanding Standby Letters of Credit Issued by it, under this Agreement shall not exceed $2,000,000 in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested time. Each disbursement or payment by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such L/C Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to its participation in any Standby Letter of Credit) of an amount drawn under Standby Letters of Credit shall be absolutedeemed to be an Advance, unconditional and irrevocableor shall be automatically reimbursed to the L/C Issuer or Agent (on behalf of the L/C Issuer) as an Advance, made pursuant to this Agreement and shall be performed strictly in accordance with bear interest at the terms Applicable Rate as of the date of such Advance pursuant to this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Standby Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrowerhave not been drawn upon shall not bear interest.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 4 contracts
Samples: Loan and Security Agreement (Harvest Capital Credit Corp), Loan and Security Agreement (Harvest Capital Credit Corp), Loan and Security Agreement (Harvest Capital Credit Corp)
Letters of Credit. (a) On Subject to the terms and subject to the conditions contained in of this Agreement, including without limitation, Section 2.15., each Issuer of the Issuing Banks, on behalf of the Revolving Lenders, agrees to Issue one or more Letters of Credit at the request of the Borrower issue for the account of the Borrower from time to time during the period commencing on from and including the Closing Effective Date and ending on to, but excluding, the earlier of the Revolving Credit Termination Date and date 30 days prior to the Revolving Loan Maturity Termination Date, one or more standby letters of credit (each a “Letter of Credit”) up to a maximum aggregate Stated Amount at any one time outstanding not to exceed $40,000,000, as such amount may be reduced from time to time in accordance with the terms hereof (the “L/C Commitment Amount”); provided, however, that no Issuer an Issuing Bank shall not be under any obligation obligated to Issue issue any Letter of Credit if:
if (w) after giving effect to such issuance, the aggregate Stated Amount of outstanding Letters of Credit issued by such Issuing Bank would exceed the lesser of (i) one-third of the L/C Commitment Amount and (ii) the Revolving Commitment of such Issuing Bank in its capacity as a Revolving Lender, (x) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms purport to enjoin or restrain such Issuer Issuing Bank from issuing such the Letter of Credit Credit, or any Requirement of Applicable Law applicable with respect to such Issuer Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer Issuing Bank shall prohibit, or request that such Issuer Issuing Bank refrain from, the issuance of letters of credit generally or such the Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter particular, (y) the beneficiary of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars a Sanctioned Person or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as suchz) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of such issuance thereofwould conflict with, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or cause such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent Issuing Bank or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of exceed any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrowerlimits imposed by, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the IssuerApplicable Law.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 4 contracts
Samples: Credit Agreement (DiamondRock Hospitality Co), Credit Agreement (DiamondRock Hospitality Co), Credit Agreement (DiamondRock Hospitality Co)
Letters of Credit. (a) On If any change in any law or regulation or in the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue one interpretation thereof by any central bank or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit if:
(i) any order, judgment or decree of any other Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority charged with jurisdiction over such Issuer shall prohibitthe administration thereof enacted, issued or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on promulgated after the date of this Agreement shall either (i) impose, modify, or result deem applicable any reserve, special deposit, or similar requirement against letters of credit issued by, or assets held by, or deposits in or for the account of, any unreimbursed loss, cost Issuing Bank or expense which was not applicable, in effect any Bank or known to such Issuer as of (ii) impose on any Issuing Bank or any Bank any other condition regarding the date provisions of this Agreement relating to the Letters of Credit or any Letter of Credit Obligations, and which such Issuer the result of any event referred to in good xxxxx xxxxx material to it;
the preceding clause (i) or (ii) such Issuer shall have received written notice from be to increase the Administrative Agent, cost to any Lender Issuing Bank of issuing or the Borrower, on or prior to the requested date of issuance of such maintaining any Letter of Credit, that one or more increase the cost to such Bank of the applicable conditions contained its risk participation in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) which increase in cost shall be more than one year after determined by such Issuing Bank’s or such Bank’s reasonable allocation of the date aggregate of issuance thereofsuch cost increases resulting from such event), then, within 10 days of written demand by such Issuing Bank or such Bank (ii) be less than five days prior with a copy sent to the Revolving Loan Maturity Date.
(c) In connection with Administrative Agent), as the issuance of each Letter of Creditcase may be, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer Issuing Bank or Bank, as the amount case may be, from time to time as specified by such Issuing Bank or such Bank, additional amounts which shall be sufficient to compensate such Issuing Bank or such Bank for such increased cost. Each Issuing Bank and each Bank agrees to use commercially reasonable efforts (consistent with internal policy and legal and regulatory restrictions) to designate a different Applicable Lending Office for the booking of its Letters of Credit or risk participations if the making of such Lender’s Ratable Portion designation would avoid the effect of this paragraph and would not, in the reasonable judgment of such payment Issuing Bank or such Bank, be otherwise disadvantageous to such Issuing Bank or such Bank, as the case may be. A certificate as to such increased cost incurred by such Issuing Bank or such Bank, as the case may be, as a result of any event mentioned in Dollars clause (ori) or (ii) above, if such payment was made in an Alternative Currency, an amount in Dollars equal to and detailing the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account calculation of such Issuer its Ratable Portion of the amount of increased costs submitted by such payment on Issuing Bank or such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan Bank to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each LenderAgent, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible conclusive and binding for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such paymentall purposes, absent manifest error.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 3 contracts
Samples: Senior Unsecured Credit Agreement (LaSalle Hotel Properties), Senior Unsecured Credit Agreement (LaSalle Hotel Properties), Senior Unsecured Credit Agreement (LaSalle Hotel Properties)
Letters of Credit. (a) On Subject to the terms and subject to conditions hereof (including the satisfaction of the applicable conditions contained set forth in this AgreementExhibit II), each Issuer agrees to Issue one the LC Bank shall issue or more cause the issuance of standby Letters of Credit denominated in either U.S. Dollars or Australian Dollars (“Letters of Credit”) at the request of the Borrower Seller’s direction, for the account of the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier Servicer or any Sub-Servicer (or such of the Revolving Credit Termination Date and 30 days prior to Servicer’s or any Sub-Servicer’s designee, which designee shall be a Subsidiary of such Sub-Servicer or the Revolving Loan Maturity DateServicer, as applicable); provided, however, that no Issuer that, for the avoidance of doubt, the LC Bank’s obligation to issue a Letter of Credit shall be subject in all respects to the limitations set forth in the last sentence of the first paragraph of Section 1.1(a).
(b) Notwithstanding anything to the contrary set forth herein or in any other Transaction Document, the LC Bank shall be under any no obligation to Issue any Letter issue Letters of Credit if:
(i) any order, judgment requested by the Seller which are denominated in Australian Dollars if the LC Bank notifies the Seller on or decree prior to the date of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing issuance that the issuance of such Letter of Credit Credit, or the funding of any Requirement draw thereunder has been made or, in the case of a draw, would be made, impracticable or unlawful by compliance by the LC Bank in good-faith with any Applicable Law applicable to such Issuer or any request or directive of any Governmental Authority (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date).
(c) In connection with Discount shall accrue on all amounts drawn under Letters of Credit for each day on and after the issuance of each Letter of Credit, the Borrower applicable Drawing Date so long as such drawn amounts shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable have not been reimbursed to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required LC Bank pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall governhereof.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 3 contracts
Samples: Receivables Purchase Agreement (Peabody Energy Corp), Receivables Purchase Agreement (Peabody Energy Corp), Receivables Purchase Agreement (Peabody Energy Corp)
Letters of Credit. (a) On the terms Provided that no Event of Default or Default is continuing and subject to the other terms and conditions contained in this Agreementhereof, each Issuer Bank agrees to Issue one or more issue letters of credit (“Letters of Credit at the request of the Borrower Credit”) for the account of the Borrower Borrowers in such form as may be approved from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior by Bank, subject to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit iffollowing limitations:
(i) any order, judgment or decree The face amount of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such the Letter of Credit or any Requirement if and when issued must not cause the sum of Law applicable to such Issuer or any request or directive (whether or not having the force aggregate principal amount outstanding of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, all Revolving Loans plus the issuance of letters of credit generally or such Letter of Credit in particular Usage to exceed the lesser of (i) the Borrowing Base, or shall impose upon such Issuer with respect to such Letter of (ii) the Revolving Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to itCommitment;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more The face amount of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would if and when issued must not cause the Letter of Credit Usage to exceed the Letter of Credit Sublimit;
(viii) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such The Letter of Credit is may not denominated in Dollars have an expiry date or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after draw period which extends beyond the date of issuance thereof, or (ii) be less than five which is 30 days prior to the Revolving Loan Loans Maturity Date.; and
(civ) In connection with the issuance of each Letter of Credit, the Borrower The conditions specified in Section 3.2 shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) have been satisfied on the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(db) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Each Letter of Credit on behalf shall (i) be denominated in Dollars, and (ii) be a standby or documentary letter of credit issued to support obligations of Borrowers or any Subsidiary, contingent or otherwise, to finance the working capital and business needs of Borrowers or such Subsidiary in the ordinary course of business.
(c) Each Letter of Credit shall be subject to the Uniform Customs or the ISP, as determined by Bank, in its Permitted Discretion, and, to the extent not inconsistent therewith, the laws of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer State of California.
(d) Bank shall Issue not at any time be obligated to issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on hereunder if such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine thatissuance would conflict with, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of cause Bank to exceed any Letter of Credit.
(e) If requested limits imposed by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other organizational or governing documents or items as may be required pursuant to the terms thereof. In the event by any Applicable Law or determination of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (an arbitrator or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance a court or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement other Governmental Authority to which such Issuer Bank is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating theretosubject.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 3 contracts
Samples: Credit Agreement (Winc, Inc.), Credit Agreement (Winc, Inc.), Credit Agreement (Winc, Inc.)
Letters of Credit. (a) On Subject to and upon the terms and subject conditions herein set forth, the Borrower may request the Letter of Credit Issuer at any time and from time to time on or after the Initial Borrowing Date and prior to the conditions contained in this AgreementRevolving Loan Maturity Date to issue, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower for the account of the Borrower and in support of, on a standby basis, L/C Supportable Indebtedness, and subject to and upon the terms and conditions herein set forth the Letter of Credit Issuer agrees to issue from time to time during time, irrevocable letters of credit in such form as may be approved by the period commencing on Letter of Credit Issuer (each such letter of credit, a "Letter of Credit" and, collectively, the Closing Date and ending on "Letters of Credit"). Notwithstanding the earlier foregoing, the Letter of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any no obligation to Issue issue any Letter of Credit ifif at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport by its terms to enjoin or restrain such the Letter of Credit Issuer from issuing such a Letter of Credit or any Requirement requirement of Law law applicable to such the Letter of Credit Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such the Letter of Credit Issuer shall prohibit, or request that such the Letter of Credit Issuer refrain from, the issuance of letters of credit generally or such the Letter of Credit in particular or shall impose upon such the Letter of Credit Issuer with respect to such the Letter of Credit any restriction or reserve or capital requirement (for which such the Letter of Credit Issuer is not otherwise compensated) not in effect on the date of this Agreement hereof, or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such the Letter of Credit Issuer as of the date of this Agreement hereof and which such the Letter of Credit Issuer in good xxxxx xxxxx material to it;; or
(ii) such the Letter of Credit Issuer shall have received notice prior to the issuance of a Letter of Credit of the type described in clause (vi) of Section 2.01(b).
(b) Notwithstanding the foregoing, (i) no Letter of Credit shall be issued the Stated Amount of which, when added to the Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and prior to the issuance of, the respective Letter of Credit) at such time, would exceed either (x) $40,000,000 or (y) when added to the aggregate principal amount of all Revolving Loans, the Total Revolving Loan Commitment at such time; (ii) each Letter of Credit shall have an expiry date occurring not later than one year after such Letter of Credit's date of issuance, provided, that any Letter of Credit may be automatically extendable for periods of up to one year so long as such Letter of Credit provides that the Letter of Credit Issuer retains an option, satisfactory to the Letter of Credit Issuer, to terminate such Letter of Credit within a specified period of time prior to each scheduled extension date; (iii) no Letter of Credit shall have an expiry date occurring later than five Business Days next preceding the Revolving Loan Maturity Date; (iv) each Letter of Credit shall be denominated in U.S. Dollars and payable on a sight basis; (v) the Stated Amount of each Letter of Credit shall not be less than $250,000 or such lesser amount as is acceptable to the Letter of Credit Issuer; and (vi) the Letter of Credit Issuer will not issue any Letter of Credit after it has received written notice from the Administrative Agent, any Lender Borrower or the Borrower, on Required Banks stating that a Default or prior to the requested date an Event of issuance of Default exists until such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed time as the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) Issuer shall have any obligation to Issue any Letter received a written notice of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after rescission of such notice from the date of issuance thereof, party or parties originally delivering the same or (ii) be less than five days prior to a waiver of such Default or Event of Default by the Revolving Loan Maturity DateRequired Banks.
(c) In connection with Notwithstanding the issuance of each Letter of Creditforegoing, in the event a Bank Default exists, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Issuer shall not be required to issue any Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) unless the Issuer of such Letter of CreditCredit Issuer has entered into arrangements satisfactory to it and the Borrower to eliminate the Letter of Credit Issuer's risk with respect to the participation in Letters of Credit of the Defaulting Bank or Banks, the stated amount including by cash collateralizing such Defaulting Bank's or Banks' RL Percentage of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of CreditOutstandings.
(d) Subject Annex X hereto contains a description of all letters of credit issued pursuant to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, Existing Credit Facility and outstanding on the requested dateEffective Date. Each such letter of credit, Issue including any extension or renewal thereof, shall constitute a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any "Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business " for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions purposes of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lenderissued, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuerfor purposes of Section 2.04(a), without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement ObligationEffective Date.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 3 contracts
Samples: Credit Agreement (Inacom Corp), Credit Agreement (Inacom Corp), Credit Agreement (Inacom Corp)
Letters of Credit. (a) On Subject to and upon the terms and subject conditions herein set forth, the Borrower, at any time and from time to time on or after the Closing Date and prior to the conditions contained in this AgreementL/C Maturity Date, each Issuer agrees to Issue one or more Letters may request that the Letter of Credit at the request of the Borrower Issuer issue, for the account of the Borrower from time to time during Borrower, a standby letter of credit or letters of credit in such form as may be approved by the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit if:Issuer in its reasonable discretion.
(b) Notwithstanding the foregoing, (i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such no Letter of Credit or any Requirement shall be issued the Stated Amount of Law applicable which, when added to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
Commitment then in effect; (vii) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such no Letter of Credit is not denominated in Dollars or in an Alternative Currency. None shall be issued the Stated Amount of which, when added to the Lenders sum of (other than x) the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit Outstandings at such time and (iy) be more the aggregate principal of all Revolving Credit Loans and Swingline Loans then outstanding, would exceed the Total Revolving Credit Commitment then in effect; (iii) each Letter of Credit shall have an expiry date occurring no later than one year after the date of issuance thereof, unless otherwise agreed upon by the Administrative Agent and the Letter of Credit Issuer, provided that in no event shall such expiry date occur later than the L/C Maturity Date; (iv) each Letter of Credit shall be denominated in Dollars; and (v) no Letter of Credit shall be issued by the Letter of Credit Issuer after it has received a written notice from the Borrower or any Lender stating that a Default or Event of Default has occurred and is continuing until such time as the Letter of Credit Issuer shall have received a written notice of (x) rescission of such notice from the party or parties originally delivering such notice or (iiy) be less than five days prior to the Revolving Loan Maturity Datewaiver of such Default or Event of Default in accordance with the provisions of Section 13.1.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent Upon at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a one Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) 's prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice promptly confirmed promptly thereafter in writing, which may be by telecopier) of to the issuance or renewal of a Administrative Agent and the Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due Issuer (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lenderof the Lenders);
(ii) upon , the request of Borrower shall have the right, on any Lenderday, furnish permanently to such Lender copies of any terminate or reduce the Letter of Credit Reimbursement Agreement Commitment in whole or in part, provided that, after giving effect to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following termination or reduction, the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at Outstandings shall not exceed the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining theretoCommitment.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 3 contracts
Samples: Credit Agreement (Randalls Food Markets Inc), Credit Agreement (Kindercare Learning Centers Inc /De), Credit Agreement (KCLC Acquisition Corp)
Letters of Credit. (ai) On As a subfacility under the Revolving Line, the L/C Issuer agrees from time to time (subject to the terms and subject to the conditions contained in of this Agreement, each Issuer agrees ) to Issue one issue or more Letters cause an Affiliate to issue commercial and standby letters of Credit at the request of the Borrower credit for the account of the Borrower from time to time during the period commencing on the Closing Date (each a “Letter of Credit,” and ending on the earlier collectively “Letters of the Revolving Credit Termination Date and 30 Credit”) until thirty (30) days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer the aggregate drawn and undrawn amount of all outstanding Letters of Credit (including the Existing Letters of Credit) shall not at any time exceed Twenty Million and 00/100 Dollars ($20,000,000) (the “L/C Sublimit”). For the avoidance of doubt, the L/C Sublimit shall be a part of, and not in addition to, the Revolving Line. The undrawn amount of all Letters of Credit shall be reserved under any obligation the Revolving Line and such amount shall not be available for borrowings. Borrower shall give Agent and the L/C Issuer notice prior to Issue 10:00 a.m., Pacific time at least five (5) Business Days prior to the proposed date of issuance of each Letter of Credit, specifying the beneficiary, the proposed date of issuance and the expiry date of such Letter of Credit, and describing the proposed terms of such Letter of Credit and the nature of the transactions proposed to be supported thereby. The issuance by the L/C Issuer of any Letter of Credit if:
(i) any ordershall, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms in addition to enjoin or restrain such Issuer from issuing the conditions precedent set forth in Section 3, be subject to the conditions precedent that such Letter of Credit or any Requirement of Law applicable shall be satisfactory to the L/C Issuer and that Borrower shall have executed and delivered such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over application agreement and/or such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect other instruments and agreements relating to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on as the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such L/C Issuer shall have received written notice from requested in its sole discretion (each, a “L/C Application”). The L/C Issuer shall deliver a copy of the Administrative L/C Application to the Agent. The form and substance of each Letter of Credit shall be subject to approval by the L/C Issuer, any Lender or in its sole discretion. Each Letter of Credit shall be issued for a term, as designated by the Borrower, on or not to exceed three hundred and sixty-five (365) days; provided, however, that no Letter of Credit shall have an expiration date later than five (5) Business Days prior to the requested Revolving Maturity Date unless Borrower has posted on the date of issuance of such Letter of Credit, that one or more Credit cash collateral to an account at the L/C Issuer and in which the Borrower grants a security interest to the Agent (for the benefit of the applicable Lenders) in an amount equal to [**] percent ([**]%) of the outstanding Letters of Credit on terms satisfactory to the Agent and the L/C Issuer in their sole discretion, in which case the expiry date of such cash collateralized Letters of Credit may be up to one (1) year later than the fifth (5th) Business Day prior to the Revolving Maturity Date. The Letters of Credit may include a provision providing that their expiry date will automatically be extended each year for an additional one (1) year period unless the L/C Issuer delivers written notice to the contrary. Each Letter of Credit shall be subject to the additional terms and conditions contained of the Letter of Credit agreements, applications and any related documents required by the L/C Issuer in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to connection with the issuance of such Letters of Credit. The L/C Issuer shall deliver to the Agent, concurrently with or promptly following its issuance of any Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance a true and complete copy of such each Letter of Credit. Promptly upon its receipt thereof, the aggregate amount Agent shall give notice to each Lender of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, specifying the Borrower shall give the relevant Issuer amount thereof and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance amount of such Letter of Credit Lender’s percentage thereof.
(ii) If the L/C Issuer shall honor a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such draft or other demand for payment presented or made under any Letter of Credit, the stated Borrower agrees to pay to the L/C Issuer an amount equal to the amount paid by the L/C Issuer in respect of the Letter of Credit requested, which stated amount (or, if such draft or other demand under such Letter of Credit and all reasonable expenses paid or incurred by the Agent relative thereto not later than 1:00 p.m. Pacific time, in United States dollars, on (i) the Business Day that the Borrower received notice of such presentment and honor, if such notice is received prior to be denominated in Dollars 11:00 a.m. Pacific time or an Alternative Currency (ii) the Business Day immediately following the day that the Borrower received such notice, if such notice is received after 11:00 a.m. Pacific time.
(iii) If the L/C Issuer shall honor a draft or other than U.S. Dollarsdemand for payment presented or made under any Letter of Credit, but the Borrower does not reimburse the L/C Issuer as required under clause (ii) above and the Revolving Line has not been terminated (whether by maturity, acceleration or otherwise), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which drawing paid under such Letter of Credit is to expire (which date shall be a Business Day), deemed an Advance under the Revolving Line and (D) the Person for whose benefit the requested Letter of Credit is to shall be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) repaid by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, Agreement applicable to such Issuer shall be Advances and the Agent will promptly notify the Lenders of such deemed to have sold and transferred to each Lenderrequest, and each such Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, make available to the extent Agent an amount equal to its pro rata share (based on its Revolving Loan Commitment Percentage) of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer Advance; provided, however, that if Advances under a Letter of Credit when such amounts the Revolving Line are due and payablenot available, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation at the time any drawing is paid, then the Borrower shall bear immediately pay to the L/C Issuer the full amount drawn, together with interest computed from the date on which such Reimbursement Obligation arose drawing is paid to the date of repayment in full such amount is fully repaid by the Borrower, at the rate of interest applicable to Advances under the Revolving Loans bearing interest at Line. In such event the Borrower agrees that the Agent, in its sole discretion, may debit any account maintained by the Borrower with the Agent for the amount of any such drawing. Amounts held in such cash collateral account shall be applied by the Agent to the payment of drafts drawn under such letters of credit and to the obligations and liabilities of the Borrower to the Agent, in such order of application as the Required Lenders may in their sole discretion elect. Notwithstanding anything herein to the contrary, the L/C Issuer shall have no obligation hereunder to issue any Letter of Credit the proceeds of which would be made available to any Person to fund any activity or business in any Prohibited Territory or with any Person organized under or doing business in a rate based Prohibited Territory. In addition to the Letters of Credit issued hereunder after the Closing Date, the Existing Letters of Credit shall remain outstanding as of the date hereof, shall be deemed to have been issued pursuant hereto, and shall be considered Letters of Credit hereunder and from and after the Closing Date shall be subject to and governed by the terms and conditions hereof including all fees in respect thereof. Notwithstanding the foregoing, (i) Borrower shall not be required to pay any additional issuance fees with respect to the issuance of the Existing Letters of Credit solely as a result of such letters of credit being converted to Letters of Credit hereunder (but the Borrower shall pay the fees set forth in Section 6.12 hereof in connection with all Letters of Credit, including the Existing Letters of Credit), and (ii) no Existing Letter of Credit may be extended or renewed.
(iv) Upon issuance by the L/C Issuer of each Letter of Credit hereunder (and on the Prime Rate during such periodClosing Date with respect to each Existing Letter of Credit), and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly automatically acquire a pro rata participation interest in such Letter of Credit and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was related payments made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent L/C Issuer in connection with such Letter of Credit, based on its respective Revolving Loan Commitment Percentage.
(v) Each Lender agrees to reimburse the L/C Issuer on demand, pro rata in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a respective Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received Commitment Percentage, for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If the reasonable out-of-pocket costs and expenses of the L/C Issuer to be reimbursed by the Borrower pursuant to any Letter of Credit (or related agreement), to the extent such Lender shall not have so made its Ratable Portion of reimbursed by the amount of the payment required by clause Borrower or any other Loan Party and (hii) above available to the Administrative Agent for the account of such Issuerany and all liabilities, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereonobligations, for the first Business Day after payment was first due at the Prime Rate andlosses, thereafterdamages, until such amount is repaid to the Administrative Agent for the account of such Issuerpenalties, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure actions, judgments, suits, costs, fees, reasonable out-of-pocket expenses or disbursements of any Lender kind and nature whatsoever which may be imposed on, incurred by or asserted against L/C Issuer in any way relating to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms or arising out of this Agreement, under any Letter of Credit, any documentation or any transaction relating thereto, to the extent not reimbursed by the Borrower, except to the extent that such liabilities, losses, costs or expenses were incurred by L/C Issuer as a result of L/C Issuer’s gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and all circumstances whatsoever, including nonappealable judgment or by the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability L/C Issuer’s wrongful dishonor of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent after the presentation to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against it by the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation thereunder of a draft or other document that does not comply demand for payment and other documentation strictly complying with the terms and conditions of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 2 contracts
Samples: Loan and Security Agreement (Cue Health Inc.), Loan and Security Agreement (Cue Health Inc.)
Letters of Credit. If any change in any law or regulation or in the interpretation thereof by any court or administrative or Governmental Authority charged with the administration thereof shall either (ai) On impose, modify, or deem applicable any reserve, special deposit, or similar requirement against letters of credit issued by, or assets held by, or deposits in or for the terms and subject account of, the Issuing Lender or (ii) impose on the Issuing Lender any other condition regarding the provisions of this Agreement relating to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters of Credit at or any Letter of Credit Obligations, and the request result of any event referred to in the preceding clause (i) or (ii) shall be to increase the cost to the Issuing Lender of issuing or maintaining any Letter of Credit (which increase in cost shall be determined by the Issuing Lender’s reasonable allocation of the Borrower for aggregate of such cost increases resulting from such event), then, upon demand by the account of Issuing Lender to the Borrower Representative, the Borrowers shall pay to the Issuing Lender, from time to time during as specified by the period commencing on Issuing Lender, additional amounts which shall be sufficient to compensate the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity DateIssuing Lender for such increased cost; provided, however, that no Issuer the Borrowers shall not be under obligated for the payment of any obligation such additional amounts to Issue the extent such costs accrued more than 180 days prior to the date the Borrower Representative was given such demand. A certificate as to such increased cost incurred by the Issuing Lender, as a result of any Letter of Credit if:
event mentioned in clause (i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to above, and detailing the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance calculation of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received increased costs submitted by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Issuing Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h)Representative, such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible conclusive and binding for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such paymentall purposes, absent manifest error.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 2 contracts
Samples: Credit Agreement (Contango Oil & Gas Co), Credit Agreement (Contango Oil & Gas Co)
Letters of Credit. If any change in any law or regulation or in the interpretation thereof by any court or administrative or Governmental Authority charged with the administration thereof shall either (ai) On impose, modify, or deem applicable any reserve, special deposit, or similar requirement against letters of credit issued by, or assets held by, or deposits in or for the terms and subject account of, the Issuing Lender or (ii) impose on the Issuing Lender any other condition regarding the provisions of this Agreement relating to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters of Credit at or any Letter of Credit Obligations, and the request result of any event referred to in the preceding clause (i) or (ii) shall be to increase the cost to the Issuing Lender of issuing or maintaining any Letter of Credit (which increase in cost shall be determined by the Issuing Lender’s reasonable allocation of the Borrower for aggregate of such cost increases resulting from such event), then, upon demand by the account of Issuing Lender to the Borrower Representative, the Borrowers shall pay to the Issuing Lender, from time to time during as specified by the period commencing on Issuing Lender, additional amounts which shall be sufficient to compensate the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity DateIssuing Lender for such increased cost; provided, however, that no Issuer the Borrowers shall not be under obligated for the payment of any obligation such additional amounts to Issue the extent such costs accrued more than 120 days prior to the date the Borrower Representative was given such demand. A certificate as to such increased cost incurred by the Issuing Lender, as a result of any Letter of Credit if:
event mentioned in clause (i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to above, and detailing the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance calculation of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received increased costs submitted by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Issuing Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h)Representative, such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible conclusive and binding for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such paymentall purposes, absent manifest error.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 2 contracts
Samples: Credit Agreement (Mariner Energy Resources, Inc.), Credit Agreement (Mariner Energy Inc)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower of, and for the account of, a Borrower to support obligations of the Borrower Parent, such Borrower, any of the Parent’s Subsidiaries or any Joint Venture, from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of date that is 30 days before the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, provided that no Issuer shall be under any obligation to Issue any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer (including, without limitation, any applicable “know your customer” and anti-money laundering rules and regulations) or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Revolving Administrative Agent, any Revolving Lender or the a Borrower, on or prior to the requested date of issuance Issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 (with respect to an Issuance on the Effective Date) or 3.6 is not then satisfiedsatisfied or duly waived in accordance with Section 11.1, and such notice has not been revoked by the Person that delivered such notice;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, (x) the Revolving Outstandings would exceed the Active Revolving Commitments in effect at such time, (y) the aggregate outstanding amount of all Letters of Credit issued by such Issuer would exceed its Letter of Credit Issuer Commitment or (z) the aggregate outstanding amount of all Financial Letters of Credit (other than the Amazon Letter of Credit) would exceed the Financial Letter of Credit Sublimit;
(iv) any fees due to the applicable Issuer in connection with a requested Issuance have not been paid;
(v) such Letter of Credit is requested to be issued in a form that is not acceptable to such Issuer, in its sole discretion exercised in a commercially reasonable manner;
(vi) with respect to any requested Letter of Credit denominated in an Alternative Currency, (A) the Issuer or the Revolving Administrative Agent shall not have approved such Issuance or (B) the Issuer receives notice from the Revolving Administrative Agent at or before 11:00 a.m. (New York time) on the date of the proposed Issuance of such Letter of Credit that, immediately after giving effect to the Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None sum of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then at such time in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance respect of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by would exceed the applicable Issuer of Alternative Currency Cap on the U.S. Dollar Equivalent date of such Letters proposed Issuance;
(vii) such Letter of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of does not comply with such utilization in Issuer’s internal policies with respect of the Letters thereto; or
(viii) such Letter of Credit Issued by itis a trade or commercial letter of credit or bank guarantee and such Issuer has not agreed in its sole discretion to Issue such Letter of Credit.
Appears in 2 contracts
Samples: Credit Agreement (McDermott International Inc), Superpriority Senior Secured Credit Agreement (McDermott International Inc)
Letters of Credit. (aii) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters No Letter of Credit at shall be issued if: (1) the request expiry date of a requested standby Letter of Credit would occur more than twelve months after the Borrower for date of issuance, unless the account Lender has approved such expiry date; or (2) the expiry date of a requested trade Letter of Credit would occur more than 180 days after the Borrower from time to time during date of issuance, unless the period commencing on Lender has approved such expiry date; (3) the Closing Date and ending on the earlier expiry date of the Revolving any Letter of Credit Termination Date and 30 is later than thirty (30) days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue any Date (iii) No Letter of Credit shall be issued if:
: (i1) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms purport to enjoin or restrain such the Issuer from issuing such Letter of Credit Credit, or any Requirement of Law applicable to such the Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such the Issuer shall prohibit, or request that such the Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such the Issuer with respect to such Letter of Credit any restriction or restriction, reserve or capital requirement (for which such the Issuer is not otherwise compensatedcompensated hereunder) not in effect on the date of this Agreement Closing Date, or result in shall impose upon the Issuer any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of applicable on the date of this Agreement Closing Date and which such the Issuer in good xxxxx xxxxx material to it;
; (ii2) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars violate one or in an Alternative Currency. None more policies of the Lenders Issuer applicable to letters of credit generally; (other than the Issuers in their capacity as such3) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (a currency other than U.S. Dollars); (4) unless otherwise agreed by the Lender and the Issuer pursuant to this Agreement, such Letter of Credit contains any provisions for automatic reinstatement of the U.S. Dollar Equivalent of such stated amountamount after any drawing thereunder; or (iv) The Issuer shall not amend any Letter of Credit if (A) the Issuer would not be less than U.S.$5,000 (permitted at such time to issue such Letter of Credit in its amended form under the tenns hereof or such lesser amount as may be agreed to by such Issuer), (B) the date beneficiary of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is does not accept the proposed amendment to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(db) Subject to the satisfaction Procedures for Issuance and Amendment of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.Auto- Extension
Appears in 2 contracts
Samples: Credit Agreement (Tecogen Inc.), Credit Agreement (Tecogen Inc.)
Letters of Credit. (a) On Subject to and upon the terms and subject conditions herein set forth, the Borrower may request the Letter of Credit Issuer at any time and from time to time on or after the Effective Date and prior to the conditions contained in this AgreementFinal Maturity Date to issue, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower for the account of the Borrower and in support of, (x) trade obligations of the Borrower or any of its Subsidiaries that arise in the ordinary course of business and are in respect of general corporate purposes of the Borrower or its Subsidiaries, as the case may be, and/or (y) on a standby basis, L/C Supportable Indebtedness, and subject to and upon the terms and conditions herein set forth, the Letter of Credit Issuer agrees to issue from time to time during time, irrevocable letters of credit in such form as may be approved by the period commencing on Letter of Credit Issuer (each such letter of credit, a "Letter of Credit" and, collectively, the Closing Date and ending on "Letters of Credit"). Notwithstanding the earlier foregoing, the Letter of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall not be under any obligation to Issue issue any Letter of Credit ifif at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport by its terms to enjoin or restrain such the Letter of Credit Issuer from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such the Letter of Credit Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such the Letter of Credit Issuer shall prohibit, or request that such the Letter of Credit Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such the Letter of Credit Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such the Letter of Credit Issuer is not otherwise compensated) not in effect on the date of this Agreement hereof, or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such the Letter of Credit Issuer as of the date of this Agreement hereof and which such the Letter of Credit Issuer in good xxxxx xxxxx material to it;; or
(ii) such the Letter of Credit Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or Required Banks prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, Credit of the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable type described in connection with a requested issuance have not been paid; or
clause (vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of CreditSection 2.01(b).
(b) In Notwithstanding the foregoing, (i) no event Letter of Credit shall be issued the expiration Stated Amount of which, when added to the Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and prior to the issuance of, the respective Letter of Credit) at such time, would exceed either (x) $10,000,000 or (y) when added to the aggregate principal amount of all Revolving Loans and Swingline Loans then outstanding, the Total Revolving Loan Commitment at such time; (ii) (x) each standby Letter of Credit shall have an expiry date occurring not later than one year after such standby Letter of Credit's date of issuance, provided, that any standby Letter of Credit may be automatically extendable for periods of up to one year so long as such standby Letter of Credit provides that the Letter of Credit Issuer retains an option, satisfactory to the Letter of Credit Issuer, to terminate such standby Letter of Credit within a specified period of time prior to each scheduled extension date and (y) each trade Letter of Credit shall have an expiry date occurring not later than 180 days after such trade Letter of Credit's date of issuance; (iii) (x) no standby Letter of Credit shall have an expiry date occurring later than the Business Day next preceding the Final Maturity Date and (y) no trade Letter of Credit shall have an expiry date occurring later than 30 days prior to the Final Maturity Date; (iv) each Letter of Credit shall be denominated in U.S. Dollars and payable on a sight basis; (v) the initial Stated Amount of each Letter of Credit shall not be less than $100,000 or such lesser amount as is acceptable to the Letter of Credit Issuer; and (vi) the Letter of Credit Issuer will not issue any Letter of Credit after it has received written notice from the Borrower or the Required Banks stating that a Default or an Event of Default exists until such time as the Letter of Credit Issuer shall have received a written notice of (i) be more than one year after rescission of such notice from the date of issuance thereof, party or parties originally delivering the same or (ii) be less than five days prior to a waiver of such Default or Event of Default by the Revolving Loan Maturity DateRequired Banks.
(c) In connection with Notwithstanding the issuance of each Letter of Creditforegoing, in the event a Bank Default exists, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Issuer shall not be required to issue any Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) unless the Issuer of such Letter of CreditCredit Issuer has entered into arrangements satisfactory to it and the Borrower to eliminate the Letter of Credit Issuer's risk with respect to the participation in Letters of Credit of the Defaulting Bank or Banks, the stated amount including by cash collateralizing such Defaulting Bank's or Banks' Percentage of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of CreditOutstandings.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 2 contracts
Samples: Credit Agreement (Therma Wave Inc), Credit Agreement (Therma Wave Inc)
Letters of Credit. (a) On Subject to the terms and subject conditions hereof and in reliance on the Lenders’ obligations under this Section 2.12, each Issuing Bank agrees to issue, from time to time on and after the Effective Date and prior to the conditions contained in this AgreementCommitment Termination Date, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower Borrower, one or more standby letters of credit (or, as may be agreed by an Issuing Bank, any other type of letter of credit or similar instrument, including financial letters of credit) (each, a “Letter of Credit”) for the account of the Borrower from time Company, any Local Content Entity or any other Subsidiary of the Company in a face amount in each case of at least $25,000 or, if denominated in a Specified Currency, the Dollar Equivalent of $25,000 (or, in either case, such lesser amount as the applicable Issuing Bank may agree to time during in its sole discretion); provided that an Issuing Bank shall not be obligated to issue or amend a Letter of Credit pursuant to this Section 2.12 if (i) immediately after giving effect to the period commencing on issuance or amendment thereof, the Closing Date and ending on the earlier aggregate Revolving Credit Exposure of all Lenders would exceed the Revolving Credit Termination Date and 30 days prior to Commitment Amount then in effect, (ii) the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter issuance of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit would violate any legal or regulatory restriction or any Requirement of Law internal policies then applicable to such Issuer Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over Lender as notified by such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally Issuing Bank or such Letter of Credit in particular or shall impose upon such Issuer with respect Lender to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or Agent before the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) immediately after giving effect to such issuance or amendment thereof, the issuance Dollar Equivalent of such the outstanding L/C Obligations would exceed $50,000,000 (the “Letter of CreditCredit Sublimit”), the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
or (iv) immediately after giving effect to the such issuance of such Letter of Creditor amendment thereof, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit L/C Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit issued by such Issuing Bank would exceed its Maximum L/C Issuance Amount; and provided, further, that, if there exists a Defaulting Lender, no Issuing Bank shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent required to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under issue a Letter of Credit proving unless the Borrower shall have complied with Section 2.12(g) with respect to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by Fronting Exposure that exists at the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms time of such Letter of Credit; and
(vi) any other act issuance or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant would exist immediately after giving effect to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) issuance. Letters of Credit and any increases and extensions thereof hereunder may be Issued issued in favor face amounts of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the BorrowerDollars or any Specified Currency.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 2 contracts
Samples: Senior Secured Revolving Credit Agreement (Seadrill LTD), Senior Secured Revolving Credit Agreement
Letters of Credit. (a) On the terms and subject conditions set forth herein, (i) the Issuing Bank agrees, from time to time on any Business Day during the period from the date of this Agreement to the conditions contained in this Agreement, each Issuer agrees day which is five (5) days prior to Issue one or more the Maturity Date to issue Letters of Credit at the request of the Borrower for the account of the Borrower from time and (ii) the Banks severally agree to time participate in Letters of Credit issued for the account of the Borrower. Within the foregoing limits, and subject to the other terms and conditions hereof, the Borrower's ability to obtain Letters of Credit shall be fully revolving, and, accordingly, the Borrower may, during the period commencing on the Closing Date foregoing period, obtain Letters of Credit to replace Letters of Credit which have expired or which have been drawn upon and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that reimbursed.
(b) The Issuing Bank has no Issuer shall be under any obligation to Issue issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport purports by its terms to enjoin or restrain such Issuer the Issuing Bank from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Issuer the Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such Issuer shall prohibitthe Issuing Bank prohibits, or request requests that such Issuer the Issuing Bank refrain from, the issuance of standby letters of credit generally or such Letter of Credit in particular or shall impose imposes upon such Issuer the Issuing Bank with respect to such Letter of Credit any restriction or restriction, reserve or capital requirement (for which such Issuer the Issuing Bank is not otherwise compensatedcompensated hereunder) not in effect on the date of this Agreement Agreement, or result in imposes upon the Issuing Bank any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of applicable on the date of this Agreement and which such Issuer the Issuing Bank in good xxxxx xxxxx material to it;
(ii) such Issuer shall have the Issuing Bank has received written notice from any Bank, the Administrative Agent, any Lender Agent or the Borrower, on or prior to the Business Day prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 Article III hereof is not then satisfied;
(iii) the expiry date of any requested Letter of Credit is (x) more than one (1) year from its date of issuance or (y) later than five (5) Business Days prior to the Maturity Date;
(iv) the Aggregate Outstandings, after giving effect to the issuance requested Letter of Credit, shall exceed the Total Commitment;
(v) the aggregate L/C Exposure, after giving effect to such Letter of Credit, the aggregate Revolving Credit Outstandings would shall exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit L/C Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer form and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is substance acceptable to the Issuer)Issuing Bank, of or the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount violates any applicable policies of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of CreditIssuing Bank.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 2 contracts
Samples: Loan Agreement (Manchester Equipment Co Inc), Loan Agreement (Manchester Equipment Co Inc)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Restatement Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (e) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum aggregate Revolving Credit Commitments in effect at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (A) the Letter of Credit Undrawn Amounts at such time and (B) the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any currency other than Dollars;
(vi) any fees due and payable in connection with a requested issuance Issuance have not been paid; or;
(vivii) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer; or
(viii) the Issuer for such Letter of Credit shall not have received, in Dollars form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. Notwithstanding anything to the contrary contained in this Section 2.4 or elsewhere in an Alternative Currency. this Agreement, in the event that a Revolving Credit Lender is a Non-Funding Lender, no Issuer shall be required to issue any Letter of Credit unless such Issuer has entered into arrangements satisfactory to it and the Borrower to eliminate such Issuer’s risk with respect to the participation in Letters of Credit by all such Non-Funding Lenders, including by cash collateralizing each such Non-Funding Lender’s Ratable Portion of the outstanding Letter of Credit Obligations.
(b) None of the Revolving Credit Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(bc) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days Business Days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (x) on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) neither the Issuer nor the Borrower shall permit any such renewal to extend the expiration date of any Letter beyond the date set forth in clause (ii) above.
(cd) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two three Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) third Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(de) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Revolving Credit Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 2 contracts
Samples: Credit Agreement (Knology Inc), Credit Agreement (Knology Inc)
Letters of Credit. (a) On Subject to and upon the terms and subject conditions set forth herein, the Borrower may request that an Issuing Lender issue, at any time and from time to time on and after the Initial Borrowing Date and prior to the 60th day prior to the Revolving Loan Maturity Date (for this purpose, determined without regard to the proviso to the definition thereof), for the account of the Borrower and for the benefit of any holder (or any trustee, agent or other similar representative for any such holders) of L/C Supportable Obligations, an irrevocable standby or trade letter of credit, in a form customarily used by such Issuing Lender or in such other form as is reasonably acceptable to such Issuing Lender (each such letter of credit, a “Letter of Credit” and, collectively, the “Letters of Credit”). All Letters of Credit shall be denominated in Dollars, issued on a sight basis only and governed by laws of the State of New York (unless the laws of another jurisdiction is agreed to by the respective Issuing Lender) and governed under The International Standby Practices (ISP98).
(b) Subject to and upon the terms and conditions contained in this Agreementset forth herein, each Issuer Issuing Lender agrees that it will, at any time and from time to Issue time on and after the Initial Borrowing Date and prior to the 60th day prior to the Revolving Loan Maturity Date (for this purpose, determined without regard to the proviso to the definition thereof), following its receipt of the respective Letter of Credit Request, issue for account of the Borrower, one or more Letters of Credit at the request as are permitted to remain outstanding hereunder without giving rise to a Default or an Event of the Borrower for the account of the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; providedDefault, however, provided that no Issuer Issuing Lender shall be under any obligation to Issue issue any Letter of Credit ifof the types described above if at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer Issuing Lender from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Issuer Issuing Lender or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer Issuing Lender shall prohibit, or request that such Issuer Issuing Lender refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer Issuing Lender with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer Issuing Lender is not otherwise compensatedcompensated hereunder) not in effect with respect to such Issuing Lender on the date of this Agreement hereof, or result in any unreimbursed loss, cost or expense which was not applicable, applicable or in effect or known with respect to such Issuer Issuing Lender as of the date of this Agreement hereof and which such Issuer Issuing Lender reasonably and in good xxxxx xxxxx material to it;; or
(ii) such Issuer Issuing Lender shall have received written notice from the Administrative Agent, any Lender or the Borrower, on any other Credit Party or the Required Lenders prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None notice of the Lenders (other than the Issuers type described in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance sentence of such Letter of CreditSection 3.03(b).
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 2 contracts
Samples: Credit Agreement (CF Industries Holdings, Inc.), Credit Agreement (CF Industries Holdings, Inc.)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Company and for the account of the Company (or for the joint and several account of the Company and a Subsidiary of the Company) one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and (x) 30 days prior to the Revolving Loan Maturity Scheduled Termination Date, in the case of a Documentary Letter of Credit and (y) 5 days prior to the Scheduled Termination Date, in the case of a Standby Letter of Credit; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v), and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to itsuch Issuer;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum aggregate Revolving Credit Commitments in effect at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Dollar Equivalents of the Letter of Credit Undrawn Amounts at such time and (ii) the Dollar Equivalents of the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) (A) such Letter of Credit is requested to be denominated in any fees due Alternative Currency and payable the Issuer receives written notice from the Administrative Agent at or before 11:00 a.m. (New York time) on the date of the proposed Issuance of such Letter of Credit that, immediately after giving effect to the Issuance of such Letter of Credit, all Letter of Credit Obligations at such time in connection with a respect of each Letter of Credit denominated in currencies other than Dollars would exceed $5,000,000 or (B) such Letter of Credit is requested issuance have not been paidto be denominated in any currency other than Dollars or an Alternative Currency; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by the Company, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Revolving Credit Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (x) on or before the expiration of each such term and each such period, the Company and the Issuer of such Letter of Credit shall have the option to prevent such renewal and (y) neither the Issuer nor the Company shall permit any such renewal to extend the expiration date of any Letter of Credit beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower Company shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount requested (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. whose Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 $500,000 (or such lesser amount as may be mutually agreed to by such between the Company and the relevant Issuer)), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. 1:00 p.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower Company in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Revolving Credit Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 2 contracts
Samples: Credit Agreement (Marquee Holdings Inc.), Credit Agreement (Amc Entertainment Inc)
Letters of Credit. (a) On Subject to and upon the terms and subject conditions herein set forth, at any time and from time to time after the Closing Date and prior to the conditions contained in this AgreementL/C Maturity Date, each Issuer agrees to Issue one or more Letters U.S. Dollar Borrower may request that the Letter of Credit at the request of the Borrower Issuer issue for the account of the such U.S. Dollar Borrower from time to time during the period commencing on the Closing Date and ending on the earlier a standby letter of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit if:
(i) any order, judgment credit or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter in U.S. Dollars (the “Letters of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed lossCredit” and each, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such a “Letter of Credit, that one or more of the applicable conditions contained ”) in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed form as may be approved by the Letter of Credit Sublimit;
(v) any fees due and payable Issuer in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Creditits reasonable discretion.
(b) In Notwithstanding the foregoing, (i) no event shall the expiration date of any Letter of Credit shall be issued the Stated Amount of which, when added to the Letters of Credit Outstanding at such time, would exceed the U.S. Dollar Letter of Credit Commitment then in effect; (iii) no Letter of Credit shall be more issued the Stated Amount of which would cause the aggregate amount of the U.S. Dollar Lenders’ U.S. Dollar Revolving Credit Exposures at such time to exceed the U.S. Dollar Revolving Credit Commitment then in effect; (iii) each Letter of Credit shall have an expiration date occurring no later than one year after the date of issuance thereof, unless otherwise agreed upon by the Asian Administrative Agent and the Letter of Credit Issuer, provided that in no event shall such expiration date occur later than the L/C Maturity Date; (iv) no Letter of Credit shall be issued if it is requested to be denominated in any currency other than U.S. Dollars; (v) no Letter of Credit shall be issued if it would be illegal under any applicable law for the beneficiary of the Letter of Credit to have a Letter of Credit issued in its favor; and (vi) no Letter of Credit shall be issued by the Letter of Credit Issuer after it has received a written notice from any Credit Party or any Lender stating that a Default or Event of Default has occurred and is continuing until such time as the Letter of Credit Issuer shall have received a written notice of (vii) rescission of such notice from the party or parties originally delivering such notice or (iiy) be less than five days prior the waiver of such Default or Event of Default in accordance with the provisions of Section 13.1. Notwithstanding anything herein to the contrary, the issuance of Letters of Credit for the account of any Borrower shall be deemed a utilization of the Revolving Loan Maturity DateCredit Commitments allocated to such Borrower.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent Upon at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a one Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) ’s prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice promptly confirmed promptly thereafter in writing, which may be by telecopier) of to the issuance or renewal of a Asian Administrative Agent and the Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due Issuer (which notice the such Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lenderof the applicable Lenders);
(ii) upon , the request of Company shall have the right, on any Lenderday, furnish permanently to such Lender copies of any terminate or reduce the U.S. Dollar Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar monthCommitment in whole or in part, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by itprovided that, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing after giving effect to such Issuer under a Letter of Credit when such amounts are due and payabletermination or reduction, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by itOutstanding shall not exceed the U.S. Dollar Letter of Credit Commitment.
Appears in 2 contracts
Samples: Credit Agreement (Avago Technologies Manufacturing (Singapore) Pte. Ltd.), Credit Agreement (Avago Technologies LTD)
Letters of Credit. (a) On Subject to the terms and subject to the conditions contained in set forth herein (including Section 2.21 and Section 2.22 of this Agreement), each Issuer Borrower may request the issuance of, and each Issuing Bank agrees to Issue issue, one or more Letters of Credit for its own account, in a form and substance reasonably acceptable to the Administrative Agent and the applicable Issuing Bank, at the request of the Borrower for the account of the Borrower any time and from time to time during the period commencing on from the Closing Date and ending on until the earlier of the Revolving Credit Termination Date and 30 days thirtieth (30th) day prior to the Revolving Loan Maturity Date; providedTermination Date on a revolving basis, however, provided that no Issuer Trade Letters of Credit shall be under issued and the minimum amount for any obligation standby Letter of Credit shall be $100,000 (or such other amount that the Issuing Bank may determine at its own discretion). In the event of any inconsistency between the terms and conditions of this Agreement and the terms and conditions of any form of letter of credit application or other agreement submitted by the applicable Borrower to, or entered into by the applicable Borrower with, the applicable Issuing Bank relating to Issue any Letter of Credit, the terms and conditions of this Agreement shall control. At the request of the applicable Borrower, any Letter of Credit if:
may be issued (i) any order, judgment or decree designating a Subsidiary of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit Borrower as a nominal account party in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one but no such designation shall in any manner limit or more impair, or relieve such Borrower of, the obligations of the applicable conditions contained such Borrower hereunder and in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance respect of such Letter of Credit, it being understood and agreed that, as among the aggregate Revolving Credit Outstandings would exceed the Maximum Credit several parties to this Agreement, such Borrower shall at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance all times have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None all of the Lenders (other than rights and be subject to all of the Issuers obligations, duties and responsibilities of an account party in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance respect thereof, or (ii) be less than five days prior to for the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer joint and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), several account of the requested issuance of such Letter of Credit (a “Letter of Credit Request”)Borrowers. Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby All Existing Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lenderbeen issued pursuant hereto, and each Lender from and after the Closing Date shall be deemed irrevocably subject to and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined governed by the Administrative Agent in accordance with its normal banking procedures) terms and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligationhereof.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 2 contracts
Samples: First Amendment and Restatement Agreement (Rayonier Inc), Five Year Revolving Credit Agreement (Rayonier Inc)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of any Borrower and for the account of such Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity DatePeriod; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v), and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit aggregate Commitments in effect at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, (A) the sum of (i) the Dollar Equivalents of the aggregate undrawn face amount of all Letters of Credit Issued by such Issuer outstanding at such time and (ii) the Dollar Equivalent of the Reimbursement Obligations owed to such Issuer at such time exceeds such Issuer’s L/C Commitment or (B) the sum of (i) the Dollar Equivalents of the Letter of Credit Undrawn Amounts at such time and (ii) the Dollar Equivalents of the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any fees due and payable in connection with a requested issuance have not been paidcurrency other than Dollars or Euros; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Revolving Loan Initial Scheduled Maturity Date (or, (A) with respect to any Letter of Credit Issued by any Issuer that has consented to the First Extension, if each of the conditions set forth in Section 2.22(b) with respect to the First Extension shall have been satisfied, the First Extended Maturity Date or (B) with respect to any Letter of Credit Issued by any Issuer that has consented to the Second Extension, if each of the conditions set forth in Section 2.22(b) with respect to the Second Extension shall have been satisfied, the Second Extended Maturity Date); provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (x) on or before the expiration of each such term and each such period, the applicable Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) such Borrower shall not permit any such renewal to extend the expiration date of any Letter beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the applicable Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount requested (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. whose Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer$1,000,000), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the Person case of an issuance, the person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.42.22, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the applicable Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from any Lender or the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall 4.02 or clause (a) above (other than those conditions set forth in clauses (a)(i), (a)(vi)(B) and (C) above and, to the extent such clause relates to fees owing to the Issuer of such Letter of Credit and its Affiliates, clause (a)(vi)(A) above) are not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 4.02 have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If Each Borrower agrees that, if requested by the relevant Issuer, prior to the issuance Issuer of each any Letter of Credit by such IssuerCredit, and as it shall execute a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by Agreement in respect to any Letter of Credit Issued hereunder for the account of such Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance or renewal Issuance of a any Letter of Credit Issued by it, of all drawings under a any Letter of Credit Issued by it and of the payment (or the failure to pay when due) by the any Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar monthquarter, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower Alcoa separate schedules for Documentary Letters of Credit and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations Obligations, in each case outstanding at the end of each month quarter and any information requested by the Borrower Borrowers or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower Borrowers with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 2 contracts
Samples: Revolving Credit Agreement (Alcoa Inc), Revolving Credit Agreement (Alcoa Inc)
Letters of Credit. (a) On Subject to and upon the terms and subject conditions herein set forth, the Borrower may request that any Issuing Lender issue, at any time on and after the Initial Borrowing Date and prior to the 30th day prior to the Maturity Date, for the account of the Borrower, irrevocable sight standby letters of credit, in a form customarily used by such Issuing Lender or in such other form as has been approved by such Issuing Lender (each such letter of credit, a “Letter of Credit”). All Letters of Credit shall be denominated in Dollars.
(b) Subject to the terms and conditions contained in this Agreementherein, each Issuer Issuing Lender hereby agrees that it will, at any time and from time to Issue time on or after the Initial Borrowing Date and prior to the 30th day prior to the Maturity Date, following its receipt of the respective Letter of Credit Request, issue for the account of the Borrower one or more Letters of Credit at in support of such obligations that do not violate the request corporate policy of the Borrower for Issuing Lender (it being understood that the account issuance of Letters of Credit supporting credit card arrangements do not violate the corporate policy of the Borrower from time Issuing Lender) and as are permitted to time during remain outstanding without giving rise to a Default or Event of Default hereunder, provided that the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer respective Issuing Lender shall be under any no obligation to Issue issue any Letter of Credit ifof the types described above if at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer Issuing Lender from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Issuer Issuing Lender or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such Issuer Issuing Lender shall prohibit, or request that such Issuer Issuing Lender refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer Issuing Lender with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer Issuing Lender is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;hereof; or
(ii) such Issuer Issuing Lender shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or Required Lenders prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of CreditCredit of the type described in the second sentence of Section 2.02(b); or
(iii) a Lender Default exists, unless such Issuing Lender has entered into arrangements reasonably satisfactory to it and the aggregate Revolving Borrower to eliminate such Issuing Lender’s risk with respect to the participation in Letters of Credit of any Defaulting Lender(s) (it being understood that cash collateralizing each Defaulting Lender’s Percentage of the Letter of Credit Outstandings would exceed the Maximum with respect to such Letters of Credit at such time;
(iv) after giving effect in an amount equal to the issuance 105% of such Letter of Credit, the aggregate amount Defaulting Lender’s Percentage of Letter of Credit Obligations then outstanding would exceed Outstandings is satisfactory) (such arrangements, the “Letter of Credit Back-Stop Arrangements”).
(c) Notwithstanding anything to the contrary contained in this Agreement, (i) no Letter of Credit shall be issued the Stated Amount of which, when added to the Letter of Credit Sublimit;
Outstandings (vexclusive of Unpaid Drawings which are repaid on the date of, and prior to the issuance of, the respective Letter of Credit) at such time would exceed either (x) [*] or (y) when added to the aggregate principal amount of all Loans then outstanding, an amount equal to the Total Commitment at such time, and (ii) each Letter of Credit shall by its terms terminate on or before the earlier of (A) the date which occurs 12 months after the date of the issuance thereof (although any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is shall be extendible for successive periods of up to 12 months, but, in each case, not denominated in Dollars or in an Alternative Currency. None of beyond the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days 10th Business Day prior to the Revolving Loan Maturity Date) and (B) 10 Business Days prior to the Maturity Date.
(cd) In connection Schedule 2.01(d) contains a description of the standby letters of credit that were issued pursuant to the Existing Credit Agreements for the account of the Borrower prior to the Initial Borrowing Date and which remain outstanding on the Initial Borrowing Date (and setting forth, with respect to each such letter of credit, (i) the name of the issuing lender, (ii) the letter of credit number, (iii) the name of the account party, (iv) the stated amount (which shall be in Dollars), (v) the name of the beneficiary and (vi) the expiry date. Each such letter of credit, including any extension or renewal thereof in accordance with the issuance of each terms thereof and hereof (each, as amended from time to time in accordance with the terms thereof and hereof, an “Existing Letter of Credit, the Borrower ”) shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (constitute a “Letter of Credit Request”). Such notice Credit” for all purposes of this Agreement and shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) deemed issued on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of CreditInitial Borrowing Date.
(e) If requested by the relevant Issuer, prior to the issuance of each any Lender becomes a Defaulting Lender at any time that any Letter of Credit by such Issuer, and as a condition of such issuanceis outstanding, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “enter into Letter of Credit Reimbursement Agreement”), signed by Back-Stop Arrangements with the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such relevant Issuing Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender becomes a Defaulting Lender (or such later date as the Issuing Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such paymentotherwise agree in its sole discretion).
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 2 contracts
Samples: Credit Agreement (NCL CORP Ltd.), Credit Agreement (NCL CORP Ltd.)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 thirty days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to itit (for which such Issuer is not otherwise compensated);
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any currency other than Dollars; or CREDIT AGREEMENT U.S. CONCRETE, INC.
(vi) (A) any fees due and payable in connection with a requested issuance Issuance have not been paid; or
, (viB) such Letter of Credit is requested to be Issued in a form that is not denominated reasonably acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Revolving Credit Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (x) on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) neither the Issuer nor the Borrower shall permit any such renewal to extend the expiration date of any Letter beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Revolving Credit Lender that one or more of the conditions precedent contained in Section 3.2 shall (Conditions Precedent to Each Loan and Letter of Credit) or clause (a) above (other than those conditions set forth in clauses (a)(i), (a)(vi)(B) and (C) above and, to the extent such clause relates to fees owing to the Issuer of such Letter of Credit and its Affiliates, clause (a)(vi)(A) above) are not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If The Borrower agrees that, if requested by the relevant Issuer, prior to the issuance Issuer of each any Letter of Credit by such IssuerCredit, and as it shall execute a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant Agreement in respect to the terms thereofany Letter of Credit Issued hereunder. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern. CREDIT AGREEMENT U.S. CONCRETE, INC.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance or renewal Issuance of a any Letter of Credit Issued by it, of all drawings under a any Letter of Credit Issued by it and of the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Revolving Credit Lender);
(ii) upon the request of any Revolving Credit Lender, furnish to such Revolving Credit Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Revolving Credit Lender; and
(iii) no later than 10 ten Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Revolving Credit Lender requesting the same) and the Borrower separate schedules for Documentary Letters of Credit and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations Obligations, in each case outstanding at the end of each month month, and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Credit Agreement (Us Concrete Inc)
Letters of Credit. (a) On Subject to the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower, for the account of the Borrower or a Restricted Subsidiary (provided that any Letter of Credit issued for the benefit of any Restricted Subsidiary shall be issued naming the Borrower as a joint and several co-applicant or as the account party on any such Letter of Credit but such Letter of Credit may contain a statement that it is being issued for the benefit of such Restricted Subsidiary), one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days five (5) Business Days prior to the Revolving Loan Maturity DateScheduled Termination Date (without giving effect to any extension of the type referred to in Section 12.1(b) hereof), or such later date as agreed to by the Administrative Agent in its sole discretion; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii) and (iii) below shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator having binding powers shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement Effective Date or result in any unreimbursed loss, cost or expense which that was not applicable, applicable or in effect or known to such Issuer as of the date of this Agreement Effective Date and which that such Issuer in good xxxxx xxxxx material to itit (for which such Issuer is not otherwise compensated);
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, (A) the Letter of Credit Obligations would exceed $45,000,000, (B) the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such timetime or (C) the Revolving Credit Outstandings of any Lender would exceed such Lender’s Revolving Credit Commitment;
(iv) such Letter of Credit is requested to be denominated in any currency other than Dollars;
(A) any fees due to the Issuer hereunder in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in form and substance reasonably acceptable to it and, if applicable, duly executed by the Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit; or
(vi) any Revolving Credit Lender is at that time a Defaulting Lender, unless (i) after giving effect to the issuance requested Issuance, there would exist no Fronting Exposure (in the good faith determination of the applicable Issuer) or (ii) the applicable Issuer has entered into arrangements, including the delivery of Cash Collateral, satisfactory to the applicable Issuer (in its good faith determination) with the Borrower or such Lender to eliminate such Issuer’s actual or potential Fronting Exposure (after giving effect to Section 2.16(a)(iv)) with respect to the Defaulting Lender arising from either the Letter of Credit, the aggregate amount of Credit then proposed to be issued or any other Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable as to which such Issuer has actual or potential Fronting Exposure, as it may elect in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currencyits sole discretion. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit. Any Letter of Credit which has been or deemed Issued hereunder may be amended by the Borrower and the Issuer at any time to reduce the amount outstanding thereunder.
(b) In no event shall the The expiration date of any each Letter of Credit (i) shall be no more than one (1) year after the date of issuance thereof; provided, or (ii) be however, that any Letter of Credit with a term less than five days or equal to one (1) year may provide for the renewal thereof for additional periods less than or equal to one (1) year, as long as, on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter of Credit shall have the option to prevent such renewal; provided further, that, for any Letter of Credit having an expiration date after the Scheduled Termination Date, the Borrower agrees to deliver to the Administrative Agent on or prior to the Revolving Loan Maturity DateScheduled Termination Date a letter of credit or letters of credit in form and substance reasonably acceptable to the Administrative Agent issued by a bank acceptable to the Administrative Agent, in each case in its sole discretion, and/or cash collateral in an amount equal to 101% of the maximum drawable amount of any such Letter of Credit or other credit support satisfactory to the Administrative Agent, in its sole discretion.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two three (3) Business Days’ prior written notice for a Standby Letter of Credit and at least five (or 5) Business Days’ prior written notice for a Documentary Letter of Credit (or, in each case, such shorter period as may be agreed to by such the Issuer) prior written notice), in substantially the form of Exhibit D E (or in such other written or electronic form as is acceptable to the such Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount in Dollars of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) last Business Day on which such notice can be given under the first sentence of this clause (or such shorter period as agreed by c); provided that the relevant Issuer) prior Issuer and the Administrative Agent may agree in a particular instance in their sole discretion to the requested issuance of such Letter of Credita later time and date.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower or the applicable Restricted Subsidiary in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender (other than a FILO Lender) that one or more of the conditions precedent contained in Section 3.2 shall 4.2 or clause (a) above are not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 4.2 have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If The Borrower agrees that, if requested by the relevant Issuer, Issuer of any Letter of Credit prior to the issuance of each a Letter of Credit by such IssuerCredit, and as it shall execute a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereofAgreement in respect of any Letter of Credit Issued hereunder. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance or renewal Issuance of a any Letter of Credit Issued by it, of all drawings under a any Letter of Credit Issued by it and of the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each LenderLender (other than the FILO Lenders));
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender[reserved]; and
(iii) no later than 10 on the first Business Days following the last day Day of each calendar month, if requested by the Administrative Agent, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender (other than the FILO Lenders) requesting the same) and the Borrower separate schedules for Documentary Letters of Credit and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations Obligations, in each case outstanding at the end of each month preceding month, and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Revolving Credit Lender, and each Revolving Credit Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit CommitmentsPortion, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a any Letter of Credit in Dollars, and, to the amount of extent so financed, all Reimbursement Obligations owing to such Issuer under a any Letter of Credit when issued for its account no later than the Business Day immediately following the Business Day on which the Borrower receives written notice from such amounts are due and payableIssuer that payment has been made under such Letter of Credit in accordance with its terms (such date, the “Reimbursement Date”), irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. the
(A) In the event that any Issuer makes any payment under any Letter absence of Credit and written notice to the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed contrary from the date on which such Reimbursement Obligation arose Borrower, and subject to the date other provisions of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay this Agreement (but without regard to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal conditions to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent borrowing set forth in Section 3.2 4.2), Reimbursement Obligations shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan financed when due with Swing Loans or Base Rate Loans, in each case to the Borrower in an equivalent amount and, to the principal amount of extent so financed, the Borrower’s obligation to make such payment. Whenever any Issuer receives from payment shall be discharged and replaced by the resulting Swing Loan or Base Rate Loan, as the case may be, and (B) in the event that the Borrower a payment of a Reimbursement Obligation as to which has notified the Administrative Agent has received for that it will not so finance any such payments, the account of such Issuer any Borrower will make payment from a Lender pursuant to this clause (h), such Issuer shall pay directly to the Administrative Agent and the applicable Issuer when due. The Administrative Agent shall promptly pay remit the proceeds from any Revolving Loans made pursuant to each Lender, clause (A) above in immediately available funds, an amount equal reimbursement of a draw under a Letter of Credit to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligationapplicable Issuer.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Each Defaulting Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Federal Funds Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Base Rate Loans under the Revolving Credit Facility (other than the FILO Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment).
(j) The Borrower’s obligation obligations to pay each Reimbursement Obligation and the obligations of the Revolving Credit Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, irrevocable and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoeverwhatsoever (it being understood that any such payment by the Borrower shall be without prejudice to, and shall not constitute a waiver of, any rights the Borrower might have or might acquire as a result of the payment by an Issuer pursuant to any Letter of Credit or the reimbursement by the Borrower thereof), including the occurrence of any Default or Event of Default, and irrespective ofof any of the following:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set set-off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the any Issuer, the Administrative Agent or any Revolving Credit Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply strictly comply, but that does substantially comply, with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the any Issuer, the Revolving Credit Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this SectionSection 2.4, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put result in any liability of such Issuer under any resulting liability to the Borrower or any Revolving Credit Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer Issuers may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) Credit, the Issuer Issuers may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever whatsoever, and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the applicable Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On Subject to and upon the terms and subject conditions set forth herein, the Borrower may request that an Issuing Bank issue, at any time and from time to time on and after the Effective Date and prior to the 30th day prior to the Final Maturity Date, (x) for the account of the Borrower and for the benefit of any holder (or any trustee, agent or other similar representative for any such holders) of L/C Supportable Obligations of PESCO or any of its Subsidiaries, an irrevocable standby letter of credit, in a form customarily used by such Issuing Bank or in such other form as has been approved by such Issuing Bank and (y) for the account of the Borrower and for the benefit of sellers of goods to PESCO or any of its Subsidiaries, an irrevocable trade letter of credit, in a form customarily used by such Issuing Bank or in such other form as has been approved by such Issuing Bank (each such letter of credit issued pursuant to this Section 2.01, a "Letter of Credit"). All Letters of Credit shall be denominated in Dollars.
(b) Subject to and upon the terms and conditions contained in this Agreementset forth herein, each Issuer Issuing Bank agrees that it will, at any time and from time to Issue time on and after the Effective Date and prior to the 30th day prior to the Final Maturity Date, following its receipt of the respective Letter of Credit Request, issue for the account of the Borrower, one or more Letters of Credit at the request as are permitted to remain outstanding without giving rise to a Default or an Event of the Borrower for the account of the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; providedDefault, however, provided that no Issuer Issuing Bank shall be under any obligation to Issue issue any Letter of Credit ifof the types described above if at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer Issuing Bank from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Issuer Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such Issuer Issuing Bank shall prohibit, or request that such Issuer Issuing Bank refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer Issuing Bank with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer Issuing Bank is not otherwise compensated) not in effect on the date of this Agreement hereof, or result in any unreimbursed loss, cost or expense which was not applicable, applicable or in effect or known with respect to such Issuer Issuing Bank as of the date of this Agreement hereof and which such Issuer Issuing Bank reasonably and in good faitx xxxxx xxxxx material xxxerial to it;; or
(ii) such Issuer Issuing Bank shall have received written notice from the Administrative Agent, any Lender Borrower or the Borrower, on or Required Banks prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than type described in the Issuers in their capacity as such) shall have any obligation to Issue any Letter second sentence of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity DateSection 2.03(b).
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable Each Issuing Bank agrees to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent who shall provide promptly forward a copy to each Lender requesting Bank) by facsimile promptly on the same) and first Business Day of each quarter the Borrower separate schedules for Documentary and Standby daily aggregate Stated Amount of all Letters of Credit Issued issued by it, in form reasonably satisfactory to such Issuing Bank for the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating theretoimmediately preceding quarter.
(gd) Immediately upon the issuance by an Issuer of The Borrower agrees (i) that its request for a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold governed by the Uniform Customs and transferred to each LenderPractice for Documentary Credits (1993 revision), and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such IssuerInternational Chamber of Commerce Publication No. 500, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In subsequent revision thereof and (ii) to promptly examine and advise the event that Issuing Bank if it notices any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) irregularity or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance non-conformance with its normal banking procedures) and instructions in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment issued by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issueran Issuing Bank.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On Subject to and upon the terms and subject to conditions set forth herein, the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters Borrower may request a Letter of Credit Issuer at the request of the Borrower for the account of the Borrower any time and from time to time during on or after the period commencing on the Closing Initial Borrowing Date and ending on the earlier of the Revolving Credit Termination Date and 30 up to thirty days prior to the Revolving Loan Maturity Date; providedDate to issue a letter of credit for the account of the Borrower and in support of (x) trade obligations of the Borrower and/or its Subsidiaries (each such letter of credit, howevera "Trade Letter of Credit" and, that collectively, the "Trade Letters of Credit") and/or (y) on a standby basis, L/C Supportable Obligations (each such letter of credit, a "Standby Letter of Credit" and, collectively, the "Standby Letters of Credit," and together with the Trade Letters of Credit, the "Letters of Credit"), and subject to and upon the terms and conditions set forth herein such Letter of Credit Issuer agrees to issue from time to time, irrevocable Letters of Credit in such form as may be approved by such Letter of Credit Issuer and the Administrative Agent. Notwithstanding the foregoing, no Letter of Credit Issuer shall be under any obligation to Issue issue any Letter of Credit ifif at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport by its terms to enjoin or restrain such Letter of Credit Issuer from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Letter of Credit Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such Letter of Credit Issuer shall prohibit, or request that such Letter of Credit Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Letter of Credit Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Letter of Credit Issuer is not otherwise compensated) not in effect on the date of this Agreement hereof, or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Letter of Credit Issuer as of the date of this Agreement hereof and which such Letter of Credit Issuer in good xxxxx xxxxx material to it;; or
(ii) such Letter of Credit Issuer shall have received written notice from the Borrower, the Administrative Agent, any Lender Agent or the Borrower, on or Required Banks prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, Credit of the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
type described in clause (iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of CreditSection 2.01(b).
(b) In Notwithstanding the foregoing, (i) no event Letter of Credit shall be issued, the expiration Stated Amount of which, when added to the Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and prior to the issuance of, the respective Letter of Credit) at such time, would exceed either (x) $15,000,000 or (y) when added to the aggregate principal amount of all Revolving Loans made by Non-Defaulting Banks and Swingline Loans then outstanding, the Adjusted Total Revolving Commitment at such time; (ii) (x) each Standby Letter of Credit shall have an expiry date occurring not later than one year after such Letter of Credit's date of issuance (although any Letter of Credit may be extendable (iwhether automatically or otherwise) be more for successive periods of up to 12 months, but not beyond ten Business Days prior to the Revolving Loan Maturity Date), on terms acceptable to the respective Letter of Credit Issuer and in no event shall any Standby Letter of Credit have an expiry date occurring later than one year the Business Day next preceding the Revolving Loan Maturity Date and (y) each Trade Letter of Credit shall have an expiry date occurring no later than the earlier of (a) 180 days after the date of issuance thereof, thereof or (iib) be less than five 30 days prior to the Revolving Loan Maturity Date.
; (ciii) In connection with the issuance of each Letter of Credit, the Borrower Credit shall give the relevant Issuer be issued on a sight basis and the Administrative Agent at least two Business Days’ shall be denominated in U.S. dollars; and (or such shorter period as may be agreed by such Issueriv) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such no Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue issue any Letter of Credit in the period commencing on the first Business Day after it receives has received written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender the Required Banks that a Default or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter an Event of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of Default exists until such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under time as such Letter of Credit as to any and all matters set forth therein, including reliance on the amount Issuer shall have received written notice of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount (x) recession of such draft and whether notice from the party or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether parties originally delivering the same or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect waiver of the documents presented under such Letter Default or Event of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination Default by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by itRequired Banks.
Appears in 1 contract
Samples: Credit Agreement (Penhall Co)
Letters of Credit. (a) On Subject to the terms and subject to conditions of this Agreement and in reliance upon the conditions contained representations and warranties of Borrower in this Agreement, each and in any master letter of credit agreement or other additional document that the L/C Issuer requests that Borrower execute, L/C Issuer agrees to Issue issue from time to time upon the request of and for the account of Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time in accordance with this Section 2.3 during the period period, commencing on the Closing Date date hereof and ending on the earlier of the Revolving Credit Termination Date and 30 days Business Day prior to the Revolving Loan Maturity Termination Date; provided, however, that no Issuer shall be under any obligation to Issue with a maturity date on any Letter of Credit ifno later than one year after the first to occur of the issuance thereof or the Termination Date. If, and to the extent, the terms and provisions of this Agreement contradict or conflict with the terms and provisions of any master letter of credit agreement executed by Borrower in favor of the L/C Issuer, the terms and provisions of such master letter of credit agreement shall govern and control.
(a) The obligation of the L/C Issuer to issue any Letter of Credit is subject to the satisfaction in full of the following conditions:
(1) after giving effect to the requested issuance of any Letter of Credit (i) any the total outstanding Letter of Credit Obligations will not exceed $5,000,000, and (ii) the sum of the total outstanding Letter of Credit Obligations and the total outstanding Revolving Credit Loans will not exceed the aggregate Commitment – Revolving Credit for all Lenders (for all purposes hereof, each Existing Letter of Credit shall be deemed to be a Letter of Credit issued hereunder);
(2) Borrower shall have delivered to the L/C Issuer at the time and manner as the L/C Issuer may prescribe the documents and materials requested by the L/C Issuer and the proposed Letter of Credit must be satisfactory to the L/C Issuer as to form and content;
(3) as of the date of issuance, no order, judgment judgment, or decree of any Governmental Authority court, arbitrator, or arbitrator governmental agency shall purport by its terms to enjoin or restrain such the L/C Issuer from issuing such the Letter of Credit Credit, and no law, rule, or any Requirement of Law regulation applicable to such the L/C Issuer or any and no request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer governmental agency shall prohibit, prohibit or request that such the L/C Issuer refrain from, from the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;; and
(iii4) after giving effect to Borrower must comply with the L/C Issuer’s normal procedures for the issuance of such Letter letters of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Creditcredit generally.
(b) In no event shall the expiration date Promptly after receipt of any Letter of Credit (i) be more than one year after application from Borrower, the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection L/C Issuer will confirm with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (telephone or in such other written or electronic form as is acceptable to writing) that the Issuer), of the requested issuance Agent has received a copy of such Letter of Credit (application from Borrower and, if not, the L/C Issuer will provide the Agent with a “Letter of Credit Request”)copy thereof. Such notice shall be irrevocable and shall (i) specify (A) Upon receipt by the L/C Issuer of such Letter of Credit, confirmation from the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to that the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer amendment is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly permitted in accordance with the terms of this Agreement, under any then, subject to the terms and all circumstances whatsoeverconditions of this Agreement, including the occurrence L/C Issuer shall, on the requested date, issue a Letter of any Default Credit for the account of Borrower or Event enter into the applicable amendment to a Letter of DefaultCredit, as the case may be, in each case in accordance with the L/C Issuer’s usual and customary business practices. Immediately upon the issuance of each Letter of Credit or amendment thereof, each Lender shall be deemed to, and irrespective of:hereby irrevocably and unconditionally agrees to, purchase from the L/C Issuer a participation in such Letter of Credit or amendment thereof in an amount equal to the product of such Lender’s Pro Rata Share times the face amount of such Letter of Credit.
(ic) any lack of validity or enforceability Promptly after its delivery of any Letter of Credit or any Loan Documentamendment to a Letter of Credit to an advising bank with respect thereto or to the beneficiary thereof, or any term or provision therein;
(ii) any amendment or waiver the L/C Issuer will also deliver to Borrower and the Agent a true and complete copy of or any consent to departure from all or any of the provisions of any such Letter of Credit or any Loan Document;amendment.
(iiid) the existence of Upon any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary drawing under any Letter of Credit, the Issuer, L/C Issuer shall notify Borrower and the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under of the amount to be paid by the L/C Issuer as a result of such drawing and the date which payment is to be made by the L/C Issuer to the beneficiary of such Letter of Credit proving to be forgedin respect of such drawing. Not later than 11:00 a.m., fraudulent, invalid or insufficient in on the date of any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the L/C Issuer under a Letter of Credit against presentation (each such date, an “Honor Date”), Borrower shall reimburse the L/C Issuer through the Agent in an amount equal to the amount of such drawing. If Borrower fails to so reimburse the L/C Issuer by such time, the Agent shall promptly notify each Lender of the Honor Date, the amount of the unreimbursed drawing (the “Unreimbursed Amount”), and such Lender’s Pro Rata Share thereof. In such event, Borrower shall be deemed to have requested a draft Revolving Credit Loan to be disbursed on the Honor Date in an amount equal to the Unreimbursed Amount, but subject to the amount of the unutilized portion of the Commitment – Revolving Credit. Any notice given by the L/C Issuer or the Agent pursuant to this Section may be given by telephone if immediately confirmed in writing; provided, that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.
(e) Each Lender (including the Lender acting as L/C Issuer) shall upon any notice pursuant to subsection 2.3(d) above make funds available to the Agent for the account of the L/C Issuer at the Agent’s office in an amount equal to its Pro Rata Share of the Unreimbursed Amount not later than 1:00 p.m. on the Business Day specified in such notice by the Agent, whereupon each Lender that so makes funds available shall be deemed to have made a Revolving Credit Loan to Borrower in such amount. The Agent shall remit the funds so received to the L/C Issuer. If the Revolving Credit Loans made pursuant to this subsection 2.3(e) are not sufficient to satisfy the Unreimbursed Amount, each Lender (including the Lender acting as L/C Issuer) shall make additional funds available to the Agent for the account of the L/C Issuer at the Agent’s office in an amount equal to its Pro Rata Share of the outstanding Unreimbursed Amount not later than 1:00 p.m. on the Business Day specified in such notice by the Agent. All amounts paid by each Lender pursuant to the immediately preceding sentence shall constitute additional loans made by each Lender to Borrower hereunder, immediately due and payable with interest at the Default Rate until paid.
(f) Until each Lender funds its Revolving Credit Loan pursuant to this Section 2.3 or otherwise reimburses the L/C Issuer for any Unreimbursed Amount, interest in respect of such Lender’s Pro Rata Share of such amount shall be solely for the account of the L/C Issuer.
(g) Each Lender’s obligation to make Revolving Credit Loans or otherwise reimburse the L/C Issuer for Unreimbursed Amounts, as contemplated by this Section 2.3, shall be absolute and unconditional and shall not be affected by any circumstance, including (1) any set-off, counterclaim, recoupment, defense or other document that does not comply with right which such Lender may have against the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the L/C Issuer, the Lenders, the Administrative Agent Borrower or any other Person for any reason whatsoever; (2) the occurrence or continuance of an Unmatured Event of Default or Event of Default, or (3) any other occurrence, event or circumstance whatsoevercondition, whether or not similar to any of the foregoing, that might, but . Any such reimbursement shall not relieve or otherwise impair the obligation of Borrower to reimburse the L/C Issuer for the provisions amount of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken any payment made by the relevant L/C Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply together with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit interest as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuerprovided herein.
(kh) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that If any Lender fails to make available to the Agent for the account party of the L/C Issuer any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.3 by the time specified in this Section 2.3, the L/C Issuer shall be entitled to recover from such Lender (acting through the Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the L/C Issuer at a rate per annum equal to the Federal Funds Rate from time to time in effect. A certificate of the L/C Issuer submitted to any Lender (through the Agent) with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) any amounts owing under this Section 2.3 shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by itconclusive absent manifest error.
Appears in 1 contract
Samples: Revolving Credit and Term Loan Agreement (Continental Materials Corp)
Letters of Credit. (a) On Subject to and upon the terms and subject conditions set forth herein, the Borrower may request that an Issuing Lender issue, at any time and from time to time on and after the Initial Borrowing Date and prior to the conditions contained in this Agreement60th day prior to the Maturity Date, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time and for the benefit of (x) any holder (or any trustee, agent or other similar representative for any such holders) of L/C Supportable Obligations, an irrevocable standby letter of credit, in a form customarily used by such Issuing Lender or in such other form as is reasonably acceptable to time during the period commencing on the Closing Date and ending on the earlier such Issuing Lender, or (y) sellers of the Revolving Credit Termination Date and 30 days prior goods to the Revolving Loan Maturity Date; Borrower or any of its Subsidiaries, an irrevocable commercial letter of credit, in a form customarily used by such Issuing Lender or in such other form as has been approved by such Issuing Lender (each such letter of credit, a “Letter of Credit” and, collectively, the “Letters of Credit”). Letters of Credit shall be denominated in Dollars and (i) shall be issued on a sight basis, and (ii) in the case of commercial Letters of Credit, may provide for time drafts having a maximum tenor of not more than 180 days, provided, however, that no Issuer such time draft shall have a tenor that would, if such time draft were issued on the expiry date of the applicable Letter of Credit, result in a maturity date that is later than the Maturity Date.
(b) Subject to and upon the terms and conditions set forth herein, each Issuing Lender agrees that it will, at any time and from time to time on and after the Initial Borrowing Date and prior to the 60th day prior to the Maturity Date, following its receipt of the respective Letter of Credit Request, issue for account of the Borrower, one or more Letters of Credit, provided that no Issuing Lender shall be under any obligation to Issue issue any Letter of Credit ifif at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer Issuing Lender from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Issuer Issuing Lender or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer Issuing Lender shall prohibit, or request that such Issuer Issuing Lender refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer Issuing Lender with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer Issuing Lender is not otherwise compensatedcompensated hereunder) not in effect with respect to such Issuing Lender on the date of this Agreement hereof, or result in any unreimbursed loss, cost or expense which was not applicable, applicable or in effect or known with respect to such Issuer Issuing Lender as of the date of this Agreement hereof and which such Issuer Issuing Lender reasonably and in good xxxxx xxxxx material to it;; or
(ii) such Issuer Issuing Lender shall have received written notice from the Administrative Agent, any Lender or the Borrower, on any other Credit Party or the Required Lenders prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None notice of the Lenders (other than the Issuers type described in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance sentence of such Letter of CreditSection 2.03(b).
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) Each Existing Letter of Credit is deemed to be a letter of credit issued hereunder for all purposes of this Agreement and the other Loan Documents. On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; providedPROVIDED, howeverHOWEVER, that no Issuer shall be under any obligation to Issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense (for which such Issuer is not otherwise compensated) that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx faith deems material to it;
(ii) such Issuer shall have received shalx xxxx xxxxived written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance Issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 3.2 and Section 3.2 2.4 is not then satisfied;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would at such time exceed 50% of the Letter of aggregate Revolving Credit SublimitCommitments;
(v) any fees due and payable in connection with a requested issuance Issuance have not been paid; or
(vi) such Letter of Credit is requested to be Issued in a form that is not denominated in Dollars or in an Alternative Currencyacceptable to such Issuer. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit Credit, (i) be more than one year after the date of issuance Issuance thereof, or (ii) ), except as provided below, be less than five thirty days prior to the Revolving Loan Maturity Scheduled Termination Date; PROVIDED, HOWEVER, that any Letter of Credit with a one-year term may provide for the renewal thereof, prior to the Scheduled Termination Date, for additional one-year periods (which shall in no event extend beyond the expiry date referred to in clause (ii) above).
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) ' prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit "LETTER OF CREDIT Request”"). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer)$10,000, (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectIssued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower and, if applicable, one of its Subsidiaries in accordance with such Issuer’s 's usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from any Lender or the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which writing may be by telecopier) of the issuance or renewal Issuance of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and it, the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail telecopy or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by itBorrower, a schedule in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(gf) Immediately upon the issuance Issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s 's Ratable Portion of the Revolving Credit CommitmentsPortion, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(hg) The Borrower agrees to pay to the Issuer of a any Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a any Letter of Credit when Issued for its account no later than the date that is the next succeeding Business Day after the Borrower receives written notice from such amounts are due and payableIssuer that payment has been made under such Letter of Credit (the "REIMBURSEMENT DATE"), irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause CLAUSE (hG) on or before 11:00 a.m. (New York City time) on the next Business Day following the Borrower's receipt of the aforesaid notice, then (i) the relevant Issuer shall notify the Administrative Agent of such payment is rescinded or set aside for any reasonfailure to repay, (ii) such Reimbursement Obligation shall bear be payable on demand with interest thereon computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to past due Revolving Loans bearing interest at a rate based on the Prime Base Rate during such period, and such Issuer (iii) the Borrower shall promptly notify be deemed to have elected (if a formal notice of Borrowing has not been received by the Administrative Agent, which shall promptly notify each Lender Agent in respect of the failure to repay such Reimbursement Obligation, ) to have the Reimbursement Obligation satisfied by the Borrowing of a Base Rate Loan in an amount equal to such Reimbursement Obligation and (iv) each Lender shall, except during the continuance of a Default or Event of Default under Section 8.1(f) and notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall promptly have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) provided that such Issuer has not received the notice referred to in the penultimate sentence of CLAUSE (D) above (and unconditionally the condition referred to in such notice has not been waived in accordance with this Agreement), pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s 's Ratable Portion of such payment Reimbursement Obligations and be deemed to have made a Revolving Loan to the Borrower in Dollars (orthe principal amount of such payment. Prior to the funding of such Revolving Loan, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause CLAUSE (hG), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s 's Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the U.S. Borrower and for the account of the U.S. Borrower (or any Subsidiary) one or more Letters of Credit at the request of the Borrower for the account of the Borrower denominated in Dollars from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that each of the Existing Letters of Credit shall be deemed to be a Letter of Credit issued hereunder for all purposes of the Loan Documents and from and after the Closing Date shall be subject to and governed by the terms and conditions hereof; provided, further, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv) and (v) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator having binding powers shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, prohibit the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which and, in each case, such Issuer in good xxxxx xxxxx faith deems such restriction, reserve, capital requirement, xxxxxxxxxxed loss, cost or expense material to itsuch Issuer;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Dollar Revolving Credit Outstandings would exceed the Maximum Credit aggregate Dollar Revolving Commitments in effect at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations then outstanding would exceed at such time for all Letters of Credit issued by such Issuer exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any currency other than Dollars; or
(A) any fees due and payable in connection with a requested issuance Issuance have not been paid; or
, (viB) such Letter of Credit is requested to be Issued in a form that is not denominated reasonably acceptable to such Issuer or (C) such Issuer shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by the U.S. Borrower, applications, agreements and other documentation (collectively with any such agreements in an Alternative Currencyeffect on the Closing Date with respect to the Existing Letters of Credit, a "Letter of Credit Reimbursement Agreement") such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Revolving Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Credit Agreement (Acco Brands Corp)
Letters of Credit. (a) On Subject to the terms and subject conditions and relying upon the representations and warranties herein set forth, each Issuing Bank shall issue and deliver to the conditions contained in this AgreementBorrower at any time and from time to time on or after the Effective Date and prior to the fifth Business Day before the Maturity Date, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Dateor any Subsidiary; provided, however, that no Issuer such Issuing Bank shall be under any obligation to Issue not issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) immediately after giving effect to the issuance of such Letter of Creditissuance, the aggregate Revolving Credit Outstandings LC Exposure at such time would exceed the Maximum Credit at such time;
(iv) after giving effect to Total LC Commitment or if the issuance sum of such Letter of Credit, the LC Exposure and the aggregate principal amount of the outstanding Loans would exceed the Total Commitment. Each Letter of Credit Obligations then outstanding would exceed (x) shall be in form as shall have been agreed upon in writing by the Letter Borrower, the Administrative Agent and such Issuing Bank, (y) shall be in a minimum principal amount of $2,000 and (z) shall permit drawings upon the presentation of one or more sight drafts and such other documents as shall be specified by the Borrower in the applicable notice delivered pursuant to paragraph (b) below and shall expire on a date not later than the fifth Business Day prior to the Maturity Date, except that Letters of Credit Sublimit;
may expire on a date later than the Maturity Date (v) but in any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None event no later than the first anniversary of the Lenders (other than Maturity Date), subject to the Issuers conditions set forth in their capacity as such) shall have any obligation to Issue any Letter of CreditSection 2.15(g).
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the The Borrower shall give the relevant Issuer and the Administrative Agent at least two such Issuing Bank written or telecopy notice or notice via computer modem not later than 10:00 a.m., New York City time, one Business Days’ Day (or such shorter period as may shall be agreed by acceptable to such IssuerIssuing Bank and the Administrative Agent) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested any proposed issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount . Each such notice shall refer to this Agreement and shall specify (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (Ci) the date on which such Letter of Credit is to expire be issued (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of account party on the Letter of Credit Obligations then outstanding will not exceed and the face amount thereof (which shall be an amount in dollars), (ii) the name and address of the benefici ary, (iii) whether such Letter of Credit Sub-Limit shall permit a single drawing or multiple drawings, (iv) the form of the sight draft and any other documents required to be presented at the time of any drawing (together with the exact wording of such documents or copies thereof) and (Bv) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance expiry date of such Letter of Credit. Such Issuing Bank shall give the Administrative Agent, which shall in turn give to each Lender, prompt written or telecopy advice of any notice received from the Borrower pursuant to this Section 2.15.
(dc) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with By the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, and without any further action on the part of all drawings under a Letter of Credit Issued by it and the payment (such Issuing Bank or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, Lenders in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreementrespect thereof, such Issuer shall be deemed to have sold and transferred Issuing Bank hereby grants to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received hereby acquires from such IssuerIssuing Bank, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, a participation in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion 's pro rata percentage, based upon its LC Commitment, of the face amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, effective upon the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms issuance of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuerprovided, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoinghowever, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted no Lender shall be required to be taken by the relevant Issuer under or acquire participations in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit that would result in its pro rata percentage, based upon its LC Commitment, of the LC Exposure exceeding its LC Commit ment, as the same may be Issued reduced from time to time in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party accordance with respect to such Letter of Credit is the BorrowerSection 2.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Revolving Credit and Letter of Credit Facility Agreement (Fingerhut Companies Inc)
Letters of Credit. (a) On Subject to the terms and subject to conditions of this Agreement and in reliance upon the conditions contained representations and warranties of Borrower in this Agreement, each and in any master letter of credit agreement or other additional document that the L/C Issuer requests that Borrower execute, L/C Issuer agrees to Issue issue from time to time upon the request of and for the account of Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time in accordance with this Section 2.3 during the period period, commencing on the Closing Date date hereof and ending on the earlier of the Revolving Credit Termination Date and 30 days Business Day prior to the Revolving Loan Maturity Termination Date; provided, however, that no Issuer shall be under any obligation to Issue with a maturity date on any Letter of Credit ifno later than one year after the first to occur of the issuance thereof or the Termination Date. If, and to the extent, the terms and provisions of this Agreement contradict or conflict with the terms and provisions of any master letter of credit agreement executed by Borrower in favor of the L/C Issuer, the terms and provisions of such master letter of credit agreement shall govern and control.
(a) The obligation of the L/C Issuer to issue any Letter of Credit is subject to the satisfaction in full of the following conditions:
(1) after giving effect to the requested issuance of any Letter of Credit (i) any the total outstanding Letter of Credit Obligations will not exceed $5,000,000, and (ii) the sum of the total outstanding Letter of Credit Obligations and the total outstanding Revolving Credit Loans will not exceed the aggregate Commitment — Revolving Credit for all Lenders (for all purposes hereof, each Existing Letter of Credit shall be deemed to be a Letter of Credit issued hereunder);
(2) Borrower shall have delivered to the L/C Issuer at the time and manner as the L/C Issuer may prescribe the documents and materials requested by the L/C Issuer and the proposed Letter of Credit must be satisfactory to the L/C Issuer as to form and content;
(3) as of the date of issuance, no order, judgment judgment, or decree of any Governmental Authority court, arbitrator, or arbitrator governmental agency shall purport by its terms to enjoin or restrain such the L/C Issuer from issuing such the Letter of Credit Credit, and no law, rule, or any Requirement of Law regulation applicable to such the L/C Issuer or any and no request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer governmental agency shall prohibit, prohibit or request that such the L/C Issuer refrain from, from the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;; and
(iii4) after giving effect to Borrower must comply with the L/C Issuer’s normal procedures for the issuance of such Letter letters of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Creditcredit generally.
(b) In no event shall the expiration date Promptly after receipt of any Letter of Credit (i) be more than one year after application from Borrower, the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection L/C Issuer will confirm with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (telephone or in such other written or electronic form as is acceptable to writing) that the Issuer), of the requested issuance Agent has received a copy of such Letter of Credit (application from Borrower and, if not, the L/C Issuer will provide the Agent with a “Letter of Credit Request”)copy thereof. Such notice shall be irrevocable and shall (i) specify (A) Upon receipt by the L/C Issuer of such Letter of Credit, confirmation from the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to that the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer amendment is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly permitted in accordance with the terms of this Agreement, under any then, subject to the terms and all circumstances whatsoever, including the occurrence conditions of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under the L/C Issuer shall, on the requested date, issue a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions account of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by enter into the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.amendment to
Appears in 1 contract
Samples: Revolving Credit and Term Loan Agreement (Continental Materials Corp)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue issue one or more Letters of Credit at the request of the a Borrower for the account of the such Borrower from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the any Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 (Conditions Precedent to Initial Loans and Letters of Credit) or Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such timetime or the aggregate Revolving Credit Outstandings owing by the Borrower for whose account such Letter of Credit is being issued exceeds such Borrower's Borrowing Base;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount sum of (i)the Letter of Credit Undrawn Amounts at such time and (ii)the Reimbursement Obligations then outstanding would exceed the Letter of Credit Sublimit;at such time exceeds $10,000,000; or
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five seven days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a one-year term may provide for the renewal thereof for additional one-year periods (which shall in no event extend beyond the expiry date referred to in clause (ii) above).
(c) In connection with the issuance of each Letter of CreditCredit for the account of any Borrower, the such Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) ' prior written notice, in substantially the form of Exhibit D (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “"Letter of Credit Request”"). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer)$50,000, (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. A.M. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue issue a Letter of Credit on behalf of the applicable Borrower in accordance with such Issuer’s 's usual and customary business practices. No Issuer shall Issue issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit for the account of any Borrower by such Issuer, and as a condition of such issuanceissuance and of the participation of each Lender in the Letter of Credit Obligations arising with respect thereto, the such Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “"Letter of Credit Reimbursement Agreement”"), signed by the such Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance or renewal of a Letter of Credit Issued issued by itit for the account of any Borrower, of all drawings under a Letter of Credit Issued issued by it and the payment (or the failure to pay when due) by the such Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower Company separate schedules for Documentary and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower Company or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit for the account of any Borrower in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s 's Ratable Portion of the Revolving Credit CommitmentsPortion, in such Letter of Credit and the obligations of the such Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower for whose account a Letter of Credit has been issued agrees to pay to the Issuer of a such Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a such Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the any Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the no Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Base Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which that shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s 's Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. A.M. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall shall, except during the continuance of a Default or Event of Default under Section 9.1(f) (Events of Default) and notwithstanding whether or not the conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower Borrowers in the principal amount of such payment. Whenever any Issuer receives from the any Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s 's Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Each Borrower’s 's obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit issued for the account of such Borrower shall be absolute, unconditional and irrevocable, irrevocable and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the any Borrower, any other party guaranteeing, or otherwise obligated with, the any Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the any Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this SectionSection 2.4, constitute a legal or equitable discharge of the any Borrower’s 's obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the any Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever whatsoever, and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(kj) Letters If and to the extent such Lender shall not have so made its Ratable Portion of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized the payment required by Letters of Credit denominated in an Alternative Currency clause (other than U.S. Dollarsi) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify above available to the Administrative Agent and for the Borrower account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand such amount together with interest thereon, for the first Business Day after payment was first due at the Federal Funds Rate and, thereafter until such amount is repaid to the Administrative Agent for the account of such Issuer, at the rate per annum applicable to Base Rate Loans under the Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the aggregate U.S. Dollar Equivalent Issuer such other Lender's Ratable Portion of any such utilization in respect of the Letters of Credit Issued by itpayment.
Appears in 1 contract
Samples: Credit Agreement (Suntek Corp)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of each Borrower and for the account of such Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Scheduled Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum aggregate Revolving Credit Commitments at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, (A) the aggregate amount of applicable Borrower’s Revolving Credit Outstandings would exceed its Revolving Credit Sublimit, (B) the Letter of Credit Obligations then outstanding with respect to such Issuer would exceed such Issuer’s Letter of Credit Sublimit or (C) the aggregate Letter of Credit Obligations of all Borrowers would exceed the Letter of Credit SublimitSublimit of all Issuers taken as a whole;
(v) such Letter of Credit is requested to be denominated in any currency other than Dollars;
(vi) (A) any fees due and payable in connection with a requested issuance Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in form and substance reasonably acceptable to it and, if applicable, duly executed by the applicable Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit;
(vii) any Lender is a Defaulting Lender, unless such Issuer is satisfied that it will have no Fronting Exposure after issuing such Letter of Credit; or
(viviii) such Letter of Credit is not denominated in Dollars or in an Alternative Currencya Standby Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (thereof or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Revolving Credit Agreement
Letters of Credit. (a) On The Bank may, from time to time upon request of the terms and subject to the conditions contained Borrower, in this Agreement, each Issuer agrees to Issue one or more its sole discretion issue Letters of Credit at the request of the Borrower for the account of the Borrower from time Borrower, subject to time during the period commencing on the Closing Date and ending on the earlier satisfaction of the Revolving conditions referenced in Section 3.03.
(b) Each Letter of Credit Termination Date and 30 days prior shall be subject to the Revolving Loan Maturity Date; provided, however, that no Issuer provisions of this Agreement and to the provisions set forth in the Letter of Credit Agreement executed by the Borrower in connection with the issuance of such Letter of Credit. The Borrower agrees to promptly perform and comply with the terms and conditions of each Letter of Credit Agreement.
(c) The payment by the Bank of a draft drawn under any Letter of Credit shall constitute for all purposes of this Agreement a Letter of Credit Advance in the amount of such draft.
(d) The Bank shall not be under any obligation to Issue issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms purport to enjoin or restrain such Issuer the Bank from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibitCredit, or request that such Issuer the Bank refrain from, or any law applicable to the Bank shall prohibit the issuance of letters of credit generally or such Letter of Credit in particular particular, any such order, judgment or decree, or law shall impose upon such Issuer the Bank with respect to such Letter of Credit any restriction or restriction, reserve or capital or liquidity requirement (for which such Issuer Issuing Bank is not otherwise compensatedcompensated hereunder) not in effect on the date of this Agreement Restatement Effective Date, or result in shall impose upon the Bank any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of applicable on the date of this Agreement Restatement Effective Date and which such Issuer that the Bank in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, Credit would violate one or more policies of the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;Bank applicable to letters of credit generally; or
(iviii) after giving effect to the issuance proceeds of such Letter of CreditCredit would be made available to any Person (x) to fund any activity or business of or with any Sanctioned Person or in any Sanctioned Countries, that, at the aggregate amount time of such funding, is the subject of any Sanctions or (y) in any manner that would result in a violation of any Sanctions by any party to this Agreement. The Bank shall be under no obligation to issue any amendment to any Letter of Credit Obligations then outstanding if the Bank would exceed have no obligation at such time to issue the Letter of Credit Sublimit;in its amended form under the terms hereof.
(ve) any fees due and payable in connection with a requested issuance have not been paid; orAs of the Restatement Effective Date, the existing Letters of Credit are set forth on Schedule 2.03 attached hereto.
(vif) [Intentionally Omitted].
(g) The Borrower shall pay to the Bank on the earlier of demand and the Termination Date the outstanding principal amount of such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of CreditAdvance.
(bh) In no event shall The Bank will notify the expiration date Borrower promptly of the presentment for payment of any Letter of Credit (i) be more than one year after on the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (orpresentment, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)possible, and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) otherwise on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any next Domestic Business Day, it being agreed that such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment notice may be made by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (hphone), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account notice of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to shall be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Credit Agreement (Bassett Furniture Industries Inc)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of each Borrower and for the account of such Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Scheduled Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum aggregate Revolving Credit Commitments at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, (A) the aggregate amount of applicable Borrower’s Revolving Credit Outstandings would exceed its Revolving Credit Sublimit, (B) the Letter of Credit Obligations then outstanding with respect to such Issuer would exceed such Issuer’s Letter of Credit Sublimit or (C) the aggregate Letter of Credit Obligations of all Borrowers would exceed the Letter of Credit SublimitSublimit of all Issuers taken as a whole;
(v) such Letter of Credit is requested to be denominated in any currency other than Dollars;
(vi) (A) any fees due and payable in connection with a requested issuance Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in form and substance reasonably acceptable to it and, if applicable, duly executed by the applicable Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit;
(vii) any Lender is a Defaulting Lender, unless such Issuer is satisfied that it will have no Fronting Exposure after issuing such Letter of Credit; or
(viviii) such Letter of Credit is not denominated in Dollars or in an Alternative Currencya Standby Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Revolving Loan Scheduled Maturity Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as (x) on or before the expiration of each such term and each such period, the applicable Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) neither the Issuer of such Letter of Credit nor the applicable Borrower shall permit any such renewal to extend the expiration date of any Letter of Credit beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the applicable Borrower shall give the relevant Issuer and the Administrative Agent at least two three Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D H (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall specify (i) specify (A) the Issuer of such Letter of Credit, (ii) the stated face amount of the Letter of Credit requested, requested (which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer$1,000,000), (Biii) the date of issuance Issuance of such requested Letter of Credit (which day date shall be a Business Day), (Civ) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (Dv) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.42.3, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the applicable Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.4.2
Appears in 1 contract
Samples: Revolving Credit Agreement (Boardwalk Pipeline Partners, LP)
Letters of Credit. (a) On the terms Provided that no Event of Default or Default is continuing and subject to the other terms and conditions contained in this Agreementhereof, each Issuer agrees to Issue one or more issue letters of credit ("Letters of Credit at the request of the Borrower Credit") for the account of the Borrower Borrowers in such form as may be approved from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior by Issuer, subject to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit iffollowing limitations:
(i) any order, judgment or decree The face amount of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such the Letter of Credit or any Requirement if and when issued must not cause the sum of Law applicable to such Issuer or any request or directive (whether or not having the force aggregate principal amount outstanding of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, all Revolving Loans plus the issuance of letters of credit generally or such Letter of Credit in particular Usage to exceed the lesser of (i) the Borrowing Base, or shall impose upon such Issuer with respect to such Letter of (ii) the aggregate Revolving Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to itCommitments;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more The face amount of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would if and when issued must not cause the Letter of Credit Usage to exceed the Letter of Credit Sublimit;
(viii) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such The Letter of Credit is may not denominated in Dollars have an expiry date or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after draw period which extends beyond the date of issuance thereof, or (ii) be less than five which is 30 days prior to the Revolving Loan Loans Maturity Date.; and
(civ) In connection with the issuance of each Letter of Credit, the Borrower The conditions specified in Section 3.2 shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) have been satisfied on the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(db) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Each Letter of Credit on behalf shall (i) be denominated in Dollars, and (ii) be a standby or documentary letter of credit issued to support obligations of Borrowers or any Subsidiary, contingent or otherwise, to finance the working capital and business needs of Borrowers or such Subsidiary in the ordinary course of business.
(c) Each Letter of Credit shall be subject to the Uniform Customs or the ISP, as determined by the applicable Issuer, in its Permitted Discretion, and, to the extent not inconsistent therewith, the laws of the Borrower in accordance with such Issuer’s usual and customary business practices. State of California.
(d) No Issuer shall Issue at any time be obligated to issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent hereunder if such issuance would conflict with, or cause such Issuer or any Lender that one L/C Participant to exceed any limits imposed by its organizational or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other governing documents or items as may be required pursuant to the terms thereof. In the event by any Applicable Law or determination of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (an arbitrator or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance a court or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement other Governmental Authority to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment L/C Participant is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligationsubject.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Credit Agreement (Auxilio Inc)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx faith deems material to it;
(ii) such Issuer shall have received xxxx xxxxxved any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(viv) such Letter of Credit is not requested to be denominated in Dollars any currency other than Dollars; or
(A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not reasonably acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in an Alternative Currencyform and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a "Letter of Credit Reimbursement Agreement") such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) unless cash collateralized in the manner set forth in Section 9.3 in an amount equal to 105% of the Letter of Credit Obligations for such Letter of Credit on the date of Issuance thereof and at all times thereafter while such Letter of Credit is outstanding, be less than five seven days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (x) on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) the Borrower shall not permit any such renewal to extend the expiration date of any Letter beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) ' prior written notice, in substantially the form of Exhibit D E (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “"Letter of Credit Request”"). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount of the Letter of Credit requested, which stated face amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer)$100,000, (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) and, in the case of an Issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s 's usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Revolving Credit Lender that one or more of the conditions precedent contained in Section 3.2 shall 3.3 (Conditions Precedent to Each Loan and Letter of Credit) or clause (a) above (other than those conditions set forth in clauses (a)(i), (a)(vi)(B) and (C) above and, to the extent such clause relates to fees owing to the Issuer of such Letter of Credit and its Affiliates, clause (a)(vi)(A) above) are not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 3.3 (Conditions Precedent to Each Loan and Letter of Credit) have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If The Borrower agrees that, if requested by the relevant Issuer, prior to the issuance Issuer of each any Letter of Credit by such Issuer, and as shall execute a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereofAgreement in respect of any Letter of Credit Issued hereunder. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance or renewal Issuance of a any Letter of Credit Issued by it, of all drawings under a any Letter of Credit Issued by it and of the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Revolving Credit Lender, furnish to such Revolving Credit Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Revolving Credit Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary Letters of Credit and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations Obligations, in each case outstanding at the end of each month month, and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On The Lender agrees, on the terms and subject to the conditions contained in this Agreementherein set forth, each to cause an Issuer agrees to Issue issue, from the Funding Date to the Termination Date, one or more Letters irrevocable standby or documentary letters of Credit at the request credit (each, a "Letter of the Borrower Credit") for the Borrower's account of and to guaranty the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that Borrower's obligations with respect thereto. The Lender shall have no Issuer shall be under any obligation to Issue cause an Issuer to issue, or to guaranty, any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having if the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars issued or an Alternative Currency (other than U.S. Dollars)guarantied, would exceed the U.S. Dollar Equivalent Borrowing Base less the sum of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then all outstanding will not exceed the Letter of Credit Sub-Limit and unpaid Revolving Advances and (B) the sum L/C Amount. Each Letter of Credit, if any, shall be issued pursuant to a separate L/C Application entered into by the Borrower and the Lender for the benefit of the aggregate principal or undrawn amount Issuer, completed in a manner satisfactory to the Lender and the Issuer. The terms and conditions set forth in each such L/C Application shall supplement the terms and conditions hereof, but if the terms of any such L/C Application and the then-outstanding terms of this Agreement are inconsistent, the terms hereof shall control.
(Ib) No Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to shall be effective, must be received by the relevant Issuer and the Administrative Agent not issued with an expiry date later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period Termination Date in effect as agreed by of the relevant Issuer) prior to the requested issuance date of such Letter of Creditissuance.
(dc) Subject Any request for the Lender to guaranty a Letter of Credit or to cause an Issuer to issue a Letter of Credit under this SECTION 2.2 shall be deemed to be a representation by the satisfaction of Borrower that the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 SECTION 4.2 have been satisfied in connection with the issuance as of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligationrequest.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Revolving Credit and Security Agreement (Brauns Fashions Corp)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of any Borrower and for the account of such Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity DatePeriod; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v), and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit aggregate Commitments in effect at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, (A) the sum of (i) the Dollar Equivalents of the aggregate undrawn face amount of all Letters of Credit Issued by such Issuer outstanding at such time and (ii) the Dollar Equivalent of the Reimbursement Obligations owed to such Issuer at such time exceeds such Issuer’s L/C Commitment or (B) the sum of (i) the Dollar Equivalents of the Letter of Credit Undrawn Amounts at such time and (ii) the Dollar Equivalents of the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any fees due and payable in connection with a requested issuance have not been paidcurrency other than Dollars or Euros; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Revolving Loan Initial Scheduled Maturity Date (or, (A) with respect to any Letter of Credit Issued by any Issuer that has consented to the First Extension, if each of the conditions set forth in Section 2.22(b) with respect to the First Extension shall have been satisfied, the First Extended Maturity Date or (B) with respect to any Letter of Credit Issued by any Issuer that has consented to the Second Extension, if each of the conditions set forth in Section 2.22(b) with respect to the Second Extension shall have been satisfied, the Second Extended Maturity Date); provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (x) on or before the expiration of each such term and each such period, the applicable Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) such Borrower shall not permit any such renewal to extend the expiration date of any Letter beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the applicable Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D F (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount requested (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. whose Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer$1,000,000), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.42.22, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the applicable Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from any Lender or the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall 4.02 or clause (a) above (other than those conditions set forth in clauses (a)(i), (a)(vi)(B) and (C) above and, to the extent such clause relates to fees owing to the Issuer of such Letter of Credit and its Affiliates, clause (a)(vi)(A) above) are not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 4.02 have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If Each Borrower agrees that, if requested by the relevant Issuer, prior to the issuance Issuer of each any Letter of Credit by such IssuerCredit, and as it shall execute a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by Agreement in respect to any Letter of Credit Issued hereunder for the account of such Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance or renewal Issuance of a any Letter of Credit Issued by it, of all drawings under a any Letter of Credit Issued by it and of the payment (or the failure to pay when due) by the any Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar monthquarter, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower Alcoa separate schedules for Documentary Letters of Credit and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations Obligations, in each case outstanding at the end of each month quarter and any information requested by the Borrower Borrowers or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On Subject to and upon the terms and subject conditions set forth herein, the Borrower may request a Letter of Credit Issuer at any time and from time to time on or after the Restatement Effective Date and prior to the conditions contained in this Agreement, each Issuer agrees Maturity Date to Issue one or more Letters issue a letter of Credit at the request of the Borrower credit for the account of the Borrower and in support of (x) trade obligations of the Borrower and/or its Subsidiaries, which shall be payable at sight (each such letter of credit, a "Trade Letter of Credit" and, collectively, the "Trade Letters of Credit") and/or (y) on a standby basis, L/C Supportable Obligations (each such letter of credit, a "Standby Letter of Credit" and, collectively, the "Standby Letters of Credit," and together with the Trade Letters of Credit, the "Letters of Credit"), and subject to and upon the terms and conditions set forth herein such Letter of Credit Issuer agrees to issue from time to time during time, irrevocable Letters of Credit in such form as may be approved by such Letter of Credit Issuer and the period commencing on Administrative Agent. Notwithstanding the Closing Date and ending on the earlier foregoing, no Letter of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue issue any Letter of Credit ifif at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport by its terms to enjoin or restrain such Letter of Credit Issuer from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Letter of Credit Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such Letter of Credit Issuer shall prohibit, or request that such Letter of Credit Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Letter of Credit Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Letter of Credit Issuer is not otherwise compensated) not in effect on the date of this Agreement hereof, or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Letter of Credit Issuer as of the date of this Agreement hereof and which such Letter of Credit Issuer in good xxxxx xxxxx material to it;; or
(ii) such Letter of Credit Issuer shall have received written notice from the Administrative Agent, any Lender Borrower or the Borrower, on or Required Banks prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, Credit of the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
type described in clause (iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of CreditSection 2.01(b).
(b) In Notwithstanding the foregoing, (i) no event Letter of Credit shall be issued, the expiration Stated Amount of which, when added to the Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and prior to the issuance of, the respective Letter of Credit) at such time, would exceed either (x) $10,000,000 or (y) when added to the aggregate principal amount of all Revolving Loans made by Non-Defaulting Banks and Swingline Loans then outstanding, the Adjusted Total Commitment at such time; (ii) (x) each Standby Letter of Credit shall have an expiry date occurring not later than one year after such Letter of Credit's date of issuance (although any Letter of Credit may be extendable (iwhether automatically or otherwise) be more for successive periods of up to 12 months, but not beyond the Business Day next preceding the Maturity Date), on terms acceptable to the respective Letter of Credit Issuer and in no event shall any Standby Letter of Credit have an expiry date occurring later than one year the Business Day next preceding the Maturity Date and (y) each Trade Letter of Credit shall have an expiry date occurring no later than the earlier of (a) 180 days after the date of issuance thereof, thereof or (iib) be less than five 30 days prior to the Revolving Loan Maturity Date.
; (ciii) In connection with the issuance of each Letter of Credit, the Borrower Credit shall give the relevant Issuer be denominated in U.S. dollars and the Administrative Agent at least two Business Days’ will be issued on a sight basis only; and (or such shorter period as may be agreed by such Issueriv) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such no Letter of Credit (a “Issuer shall issue any Letter of Credit Request”). Such after it has received written notice shall be irrevocable and shall (i) specify (A) from the Issuer Borrower that a Default or an Event of Default exists until such Letter of Credit, the stated amount of time as the Letter of Credit requested, which stated amount Issuers shall have received written notice of (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent x) recession of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent party or any Lender that one parties originally delivering the same or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(ey) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition waiver of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees Issuer, in its sole discretion, may elect to Issue at the request of any Borrower and for the account of such Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity DatePeriod; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v), and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx fxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit aggregate Commitments in effect at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, (A) the sum of (i) the Dollar Equivalents of the aggregate undrawn face amount of all Letters of Credit Issued by such Issuer outstanding at such time and (ii) the Dollar Equivalent of the Reimbursement Obligations owed to such Issuer at such time exceeds such Issuer’s L/C Commitment or (B) the sum of (i) the Dollar Equivalents of the Letter of Credit Undrawn Amounts at such time and (ii) the Dollar Equivalents of the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any fees due and payable in connection with a requested issuance have not been paidcurrency other than Dollars or Euros; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days Business Days prior to the Revolving Loan Initial Scheduled Maturity Date (or, (A) with respect to any Letter of Credit Issued by any Issuer that has consented to the First Extension, if each of the conditions set forth in Section 2.21(b) with respect to the First Extension shall have been satisfied, the First Extended Maturity Date or (B) with respect to any Letter of Credit Issued by any Issuer that has consented to the Second Extension, if each of the conditions set forth in Section 2.21(b) with respect to the Second Extension shall have been satisfied, the Second Extended Maturity Date); provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (x) on or before the expiration of each such term and each such period, the applicable Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) such Borrower shall not permit any such renewal to extend the expiration date of any Letter beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the applicable Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount requested (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. whose Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer$1,000,000), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the Person case of an issuance, the person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.42.22, the relevant Issuer shallIssuer, in its sole discretion, may elect to Issue, on the requested date, Issue date a Letter of Credit on behalf of the applicable Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from any Lender or the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall 4.02 or clause (a) above (other than those conditions set forth in clauses (a)(i), (a)(vi)(B) and (C) above and, to the extent such clause relates to fees owing to the Issuer of such Letter of Credit and its Affiliates, clause (a)(vi)(A) above) are not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 4.02 have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If Each Borrower agrees that, if requested by the relevant Issuer, prior to the issuance Issuer of each any Letter of Credit by such IssuerCredit, and as it shall execute a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by Agreement in respect to any Letter of Credit Issued hereunder for the account of such Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which writing may be by telecopiera telecopy or electronic mail) of the issuance or renewal Issuance of a any Letter of Credit Issued by it, of all drawings under a any Letter of Credit Issued by it and of the payment (or the failure to pay when due) by the any Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar monthquarter, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower Howmet separate schedules for Documentary Letters of Credit and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations Obligations, in each case outstanding at the end of each month quarter and any information requested by the Borrower Borrowers or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower Borrowers with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On The Letter of Credit Commitments.
(i) Subject to the terms and subject to conditions set forth herein, (A) each L/C Issuer agrees, in reliance upon the conditions contained agreements of the other Lenders set forth in this AgreementSection 2.03, each Issuer agrees (x) from time to Issue one or more time on any Business Day during the period from the Closing Date until the Letter of Credit Expiration Date, to issue Letters of Credit at the request of the Borrower denominated in Dollars or in an Alternative Currency for the account of the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Canadian
(ii) An L/C Issuer shall be under any obligation to Issue not issue any Letter of Credit if:: (A) subject to Section 2.03(b)(iii), the expiry date of such requested Letter of Credit would occur more than twelve months after the date of issuance or last renewal, unless otherwise agreed by the L/C Issuer and the Administrative Agent in their sole discretion; or (B) the expiry date of such requested Letter of Credit would occur after the applicable Letter of Credit Expiration Date, unless (1) each Appropriate Lender shall have approved such expiry date or (2) the Outstanding Amount of the L/C Obligations in respect of such requested Letter of Credit has been Cash Collateralized.
(iiii) An L/C Issuer shall be under no obligation to issue any Letter of Credit if: (A) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms purport to enjoin or restrain such L/C Issuer from issuing such Letter of Credit Credit, or any Requirement of Law applicable to such L/C Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such L/C Issuer shall prohibit, or request direct that such L/C Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such L/C Issuer with respect to such Letter of Credit any restriction or restriction, reserve or capital requirement (for which such L/C Issuer is not otherwise compensatedcompensated hereunder) not in effect on the date of this Agreement Closing Date, or result in shall impose upon such L/C Issuer any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of applicable on the date of this Agreement and Closing Date (for which such L/C Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such timeotherwise compensated hereunder);
(iv) after giving effect An L/C Issuer shall be under no obligation to the issuance of such Letter of Credit, the aggregate amount of amend any Letter of Credit Obligations then outstanding if (A) such L/C Issuer would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) no obligation at such time to issue such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of its amended form under the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereofterms hereof, or (iiB) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance beneficiary of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) does not accept the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is proposed amendment to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(dv) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Each L/C Issuer shall, on the requested date, Issue a Letter of Credit shall act on behalf of the Borrower in accordance Appropriate Lenders with such Issuer’s usual and customary business practices. No Issuer shall Issue respect to any Letter Letters of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued issued by it and the payment documents associated therewith, and each L/C Issuer shall have all of the benefits and immunities (or the failure to pay when dueA) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide provided to the Administrative Agent (and in Article IX with respect to any acts taken or omissions suffered by the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby L/C Issuer in connection with Letters of Credit Issued issued by it, in form reasonably satisfactory it or proposed to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month be issued by it and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty Documents pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly as fully as if the term “Administrative Agent” as used in accordance with Article IX included the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the L/C Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is acts or omissions, and (B) as additionally provided herein with respect to the BorrowerL/C Issuer.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Credit Agreement (Avaya Inc)
Letters of Credit. (a) On As between the terms Borrower and subject to the conditions contained in this AgreementLender, each Issuer agrees to Issue one the Borrower assumes all risks of the acts and omissions of, or more misuse of the Letters of Credit at by, the request respective beneficiaries of the Borrower for the account Letters of the Borrower from time to time during the period commencing on the Closing Date Credit. In furtherance and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any limitation of the foregoing, that mightthe Lender, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconductwilful misconduct of Lender, shall not be responsible: (i) for the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for and issuance of the Letters of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in while or in part, which may prove to be invalid or ineffective for any reason; (iii) for failure of the beneficiary of a Letter of Credit to comply fully with conditions required in order to draw upon such Letter of Credit; (iv) for errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher; (v) for errors in interpretation of technical terms; (vi) for any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any Letter of Credit or of the proceeds thereof; (vii) for the misapplication by the beneficiary of a Letter of Credit of the proceeds of any drawing under such Letter of Credit; and (viii) for any consequences arising from causes beyond the control of the Lender, including any act or omission by any government or governmental authority. None of the above shall affect, impair, or prevent the vesting of any of the Lender's rights or powers hereunder. In furtherance and extension and not in limitation of the specific provisions set forth herein, any action taken or omitted by the Lender, under or i connection with the Letters of Credit or the related certificates, if taken or omitted in good faith, shall not put such Issuer the Lender under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Credit Agreement (Ditech Corp)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance Issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 (Conditions Precedent to Initial Loans and Section Letters of Credit) or 3.2 (Conditions Precedent to Each Loan and Letter of Credit) is not then satisfied;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of Letter of Credit Obligations then outstanding would exceed (i) the Letter of Credit SublimitUndrawn Amounts at such time and (ii) the Reimbursement Obligations at such time exceeds $15,000,000;
(v) any fees due and payable in connection with a requested issuance Issuance have not been paid; or
(vi) such Letter of Credit is not denominated requested in Dollars or in an Alternative Currencyany currency other than Dollars. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five thirty (30) days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a one-year term may provide for the renewal thereof for additional one-year periods (which shall in no event extend beyond the expiry date referred to in clause (ii) above).
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) ' prior written notice, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “"Letter of Credit Request”"). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer)$50,000, (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s 's usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) shall not on such date be satisfied, satisfied and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, Issuer and as a condition of such issuanceIssuance and of the participation of each Lender in the Letter of Credit Obligations arising with respect thereto, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “"Letter of Credit Reimbursement Agreement”"), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance Issuance or renewal of a Letter of Credit Issued issued by it, of all drawings under a Letter of Credit Issued issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s 's Ratable Portion of the Revolving Credit CommitmentsPortion, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a any Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a any Letter of Credit when issued for its account no later than the date (the "Reimbursement Date") that is the next succeeding Business Day after the Borrower receives written notice from such amounts are due and payableIssuer that payment has been made under such Letter of Credit, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear be payable on demand with interest thereon computed (i) from the date on which such Reimbursement Obligation arose to the date of repayment in full Reimbursement Date, at the rate of interest applicable during such period to Revolving Loans bearing that are Base Rate Loans and (ii) from the Reimbursement Date until the date of repayment in full, at the rate of interest at a rate based on the Prime applicable during such period to past due Revolving Loans that are Base Rate Loans during such period, and such Issuer shall promptly notify the Administrative Agent, which that shall promptly notify each Lender of the failure to repay such Reimbursement Obligationfailure, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s 's Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall shall, except during the continuance of a Default or Event of Default under Section 9.1(g) (Events of Default) and notwithstanding whether or not the conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) ), be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s 's Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s 's obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, irrevocable and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective ofof any of the following:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the any Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this SectionSection 2.4, constitute a legal or equitable discharge of the Borrower’s 's obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) Credit, the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other 38 statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever whatsoever, and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(kj) Letters If and to the extent such Lender shall not have so made its Ratable Portion of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized the payment required by Letters of Credit denominated in an Alternative Currency clause (other than U.S. Dollarsh) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify above available to the Administrative Agent and for the Borrower account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand such amount together with interest thereon, for the first Business Day after payment was first due at the Federal Funds Rate and, thereafter until such amount is repaid to the Administrative Agent for the account of such Issuer, at the rate per annum applicable to Base Rate Loans under the Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the aggregate U.S. Dollar Equivalent Issuer such other Lender's Ratable Portion of any such utilization in respect of the Letters of Credit Issued by itpayment.
Appears in 1 contract
Samples: Credit Agreement (Aviall Inc)
Letters of Credit. (a) On Subject to and upon the terms and subject conditions herein set forth, the Borrower, at any time and from time to time on or after the Closing Date and prior to the conditions contained in this AgreementL/C Maturity Date, each Issuer agrees to Issue one or more Letters may request that the Letter of Credit at the request of the Borrower Issuer issue, for the account of the Borrower from time to time during Borrower, a standby letter of credit or letters of credit (in such form as may be approved by the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit if:Issuer in its reasonable discretion) which is participated by the Letter of Credit Issuer pursuant to Section 3.3 (each such letter of credit, a "LETTER OF CREDIT").
(b) Notwithstanding the foregoing, (i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such no Letter of Credit or any Requirement shall be issued the Stated Amount of Law applicable which, when added to such Issuer or any request or directive the sum of (whether or not having x) the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon Outstanding at such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement time and (for which such Issuer is not otherwise compensatedy) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate principal of all Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations Loans then outstanding would exceed the Total Revolving Credit Commitment then in effect; (ii) each Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In an expiry date occurring no event shall the expiration date of any Letter of Credit (i) be more later than one year after the date of issuance thereof, or (ii) be less ; provided that in no event shall such expiry date occur later than five days prior to the Revolving Loan L/C Maturity Date.
; (ciii) In connection with the issuance of each Letter of Credit, the Borrower Credit shall give the relevant Issuer be denominated in Dollars and the Administrative Agent at least two Business Days’ shall provide for drawings thereunder to be made in Dollars; and (or such shorter period as may be agreed by such Issueriv) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such no Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of issued by the Letter of Credit requested, which stated amount (or, if Issuer after it has received a written notice from the Borrower or any Lender stating that a Default or Event of Default has occurred and is continuing until such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount time as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter Issuer shall have received a written notice of Credit Sub-Limit and (Bx) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance rescission of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent party or any Lender parties originally delivering such notice (provided that one or more of in the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance case of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have notice delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice has not objected to or contested such rescission) or (y) the waiver of such Default or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) Event of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit Default in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the IssuerSection 12.1.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
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Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees Issuer, in its sole discretion, may elect to Issue at the request of any Borrower and for the account of such Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity DatePeriod; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v), and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx fxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit aggregate Commitments in effect at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, (A) the sum of (i) the Dollar Equivalents of the aggregate undrawn face amount of all Letters of Credit Issued by such Issuer outstanding at such time and (ii) the Dollar Equivalent of the Reimbursement Obligations owed to such Issuer at such time exceeds such Issuer’s L/C Commitment or (B) the sum of (i) the Dollar Equivalents of the Letter of Credit Undrawn Amounts at such time and (ii) the Dollar Equivalents of the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any fees due and payable in connection with a requested issuance have not been paidcurrency other than Dollars or Euros; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days Business Days prior to the Revolving Loan Initial Scheduled Maturity Date (or, (A) with respect to any Letter of Credit Issued by any Issuer that has consented to the First Extension, if each of the conditions set forth in Section 2.21(b) with respect to the First Extension shall have been satisfied, the First Extended Maturity Date or (B) with respect to any Letter of Credit Issued by any Issuer that has consented to the Second Extension, if each of the conditions set forth in Section 2.21(b) with respect to the Second Extension shall have been satisfied, the Second Extended Maturity Date); provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (x) on or before the expiration of each such term and each such period, the applicable Borrower and the Issuer of such Letter of Credit shall have the option to prevent such renewal and (y) such Borrower shall not permit any such renewal to extend the expiration date of any Letter of Credit beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the applicable Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount requested (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. whose Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer$1,000,000), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the Person case of an issuance, the person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.42.22, the relevant Issuer shallIssuer, in its sole discretion, may elect to Issue, on the requested date, Issue date a Letter of Credit on behalf of the applicable Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from any Lender or the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall 4.02 or clause (a) above (other than those conditions set forth in clauses (a)(i), (a)(vi)(B) and (C) above and, to the extent such clause relates to fees owing to the Issuer of such Letter of Credit and its Affiliates, clause (a)(vi)(A) above) are not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 4.02 have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If Each Borrower agrees that, if requested by the relevant Issuer, prior to the issuance Issuer of each any Letter of Credit by such IssuerCredit, and as it shall execute a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by Agreement in respect to any Letter of Credit Issued hereunder for the Borrower, and account of such other documents or items as may be required pursuant to the terms thereofBxxxxxxx. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which writing may be by telecopiera telecopy or electronic mail) of the issuance or renewal Issuance of a any Letter of Credit Issued by it, of all drawings under a any Letter of Credit Issued by it and of the payment (or the failure to pay when due) by the any Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such LenderLxxxxx; and
(iii) no later than 10 Business Days following the last day of each calendar monthquarter, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower Howmet separate schedules for Documentary Letters of Credit and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations Obligations, in each case outstanding at the end of each month quarter and any information requested by the Borrower Borrowers or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such LenderLxxxxx’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower Borrowers with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
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Letters of Credit. (a) On Subject to and upon the terms and subject conditions herein set forth, the Company may request the Letter of Credit Issuer at any time and from time to time on or after the Initial Borrowing Date and prior to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters tenth Business Day preceding the Revolving Loan Maturity Date and Essex may request the Letter of Credit Issuer at any time and from time to time on or after the request Initial Borrowing Date until the consummation of the Borrower Merger to issue, for the account of either Borrower and in support of, on a standby basis, L/C Supportable Indebtedness of either Borrower or any of their respective Subsidiaries that are Guarantors to any other Person, irrevocable letters of credit in such form as may be approved by such Letter of Credit Issuer (each such letter of credit, a "Letter of Credit" and, collectively, the Borrower from time to time during "Letters of Credit"). Notwithstanding the period commencing on the Closing Date and ending on the earlier foregoing, no Letter of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue issue any Letter of Credit ifif at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport by its terms to enjoin or restrain such Letter of Credit Issuer from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Letter of Credit Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such Letter of Credit Issuer shall prohibit, or request that such Letter of Credit Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Letter of Credit Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Letter of Credit Issuer is not otherwise compensatedcompensated pursuant to the terms hereof) not in effect on the date of this Agreement hereof, or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Letter of Credit Issuer as of the date of this Agreement hereof and which such Letter of Credit Issuer in good xxxxx xxxxx material to it;; or
(ii) such Letter of Credit Issuer shall have received written notice from the Administrative Agent, any Lender applicable Borrower or the Borrower, on or Required Lenders prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, Credit of the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
type described in clause (v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of CreditSection 2.01(b).
(b) In Notwithstanding the foregoing, (i) no event Letter of Credit shall be issued the expiration Stated Amount of which, when added to the Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and prior to the issuance of, the respective Letter of Credit) at such time, would exceed either (x) the Letter of Credit Sublimit or (y) when added to the aggregate principal amount of all Revolving Loans and Swingline Loans then outstanding, the Total Revolving Loan Commitment at such time; (ii) each Letter of Credit (including Letters of Credit requested by Essex prior to the consummation of the Merger) shall have an expiry date occurring not later than one year after such Letter of Credit's date of issuance; provided that any such Letter of Credit may be automatically extendible for periods of up to one year so long as such Letter of Credit provides that the respective Letter of Credit Issuer retains an option, satisfactory to such Letter of Credit Issuer, to terminate such Letter of Credit within a specified period of time prior to each scheduled extension date; provided, further, that any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less shall expire no later than five days Business Days prior to the Revolving Loan Maturity Date; (iii) each Letter of Credit shall be denominated in U.S. Dollars and issued on a sight basis; (iv) each Letter of Credit shall not be less than $25,000.00 or such lesser amount as is acceptable to the respective Letter of Credit Issuer; and (v) no Letter of Credit Issuer will issue any Letter of Credit after it has received written notice from the Borrowers or the Required Lenders stating that a Default or an Event of Default exists until such time as such Letter of Credit Issuer shall have received a written notice of (x) rescission of such notice from the party or parties originally delivering the same or (y) a waiver of such Default or Event of Default by the Required Lenders.
(c) In connection with Notwithstanding the issuance of each foregoing, in the event a Lender Default exists, no Letter of Credit, Credit Issuer shall be required to issue any Letter of Credit unless the Borrower shall give the relevant respective Letter of Credit Issuer has entered into arrangements satisfactory to it and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable Borrowers to the Issuer), of the requested issuance of eliminate such Letter of Credit (a “Letter Issuer's risk with respect to the participation in Letters of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars Defaulting Lender or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of CreditLenders.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory issued under the Existing Superior Credit Agreement set forth on Annex VII are deemed to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of be issued under this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Company and for the account of the Company (or for the joint account of the Company and any of its Subsidiaries) one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (v) and to the extent relating to any fees owing to the Issuer of such Letter of Credit or its Affiliates, clause (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit LC Obligation Outstandings would exceed the Maximum Credit LC Commitments of all LC Participants at such time;
(iv) after giving effect to in the issuance case of Barclays, if such Letter of Credit, the aggregate amount of Credit is a Documentary Letter of Credit Obligations then outstanding would exceed the Letter of Credit SublimitCredit;
(v) such Letter of Credit is requested to be denominated in any fees due and payable in connection with a requested issuance have not been paidcurrency other than Dollars; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by the Company, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders LC Participants (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit. Additionally, notwithstanding the foregoing, in no event shall Bank of America, N.A. or Citibank, N.A., in their respective capacities as Issuers, be required to issue any Letter of Credit (other than the deemed issuance of the Existing Letters of Credit hereunder on the Effective Date) or to extend the expiration date or increase the stated amount of any Existing Letter of Credit, nor shall the Company request such issuance, extension or increase.
(b) In no event shall the expiration date of any Letter of Credit be (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than after the date that is five days Business Days prior to the Revolving Loan Maturity Termination Date, unless consented to by the applicable Issuer in such Issuer’s sole discretion; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the automatic renewal thereof for additional periods less than or equal to one year, as long as, on or before the expiration of each such term and each such period, each of the Company and the Issuer of such Letter of Credit shall have the option to prevent such automatic renewal.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower Company shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D B (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer, including, but not limited to, the executed Letter of Credit Reimbursement Agreement of such Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) third Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower Company in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender LC Participant that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.3.2
Appears in 1 contract
Samples: Letter of Credit Facility Agreement (Tenet Healthcare Corp)
Letters of Credit. (a) On Subject to and upon the terms and subject conditions set forth herein, the Borrower may request a Letter of Credit Issuer at any time and from time to time on or after the Effective Date and prior to the conditions contained in this Agreement, each Issuer agrees tenth Business Day immediately preceding the Maturity Date to Issue one or more Letters issue a standby letter of Credit at the request of the Borrower credit for the account of the Borrower in support of L/C Supportable Obligations (each such letter of credit, a "Letter of Credit" and, collectively, the "Letters of Credit"), and subject to and upon the terms and conditions set forth herein such Letter of Credit Issuer agrees to issue from time to time during time, irrevocable Letters of Credit in such form as may be approved by such Letter of Credit Issuer and the period commencing on Administrative Agent. Notwithstanding the Closing Date and ending on the earlier foregoing, no Letter of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue issue any Letter of Credit ifif at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport by its terms to enjoin or restrain such Letter of Credit Issuer from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Letter of Credit Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such Letter of Credit Issuer shall prohibit, or request that such Letter of Credit Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Letter of Credit Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Letter of Credit Issuer is not otherwise compensated) not in effect on the date of this Agreement Effective Date, or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Letter of Credit Issuer as of the date of this Agreement Effective Date and which such Letter of Credit Issuer in good xxxxx xxxxx material to it;
(ii) such Letter of Credit Issuer shall have received written notice from the Administrative Agent, any Lender Borrower or the Borrower, on or Required Banks prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, Credit of the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
type described in clause (v) any fees due and payable in connection with a requested issuance have not been paidof Section 2A.1(b); or
(viiii) the Administrative Agent or such Letter of Credit is Issuer has received notice from any Bank that it does not denominated intend to participate in Dollars such Letter of Credit pursuant to Section 2A.5, or any Bank has failed to participate in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of CreditCredit issued hereunder, unless the Borrower and such Letter of Credit Issuer shall have entered into arrangements reasonably satisfactory to such Letter of Credit Issuer to eliminate the risk of such Bank's failure to participate in Letters of Credit (including cash collateralizing the amount of such Bank's obligation).
(b) In Notwithstanding the foregoing, (i) no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars)issued, the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed the Stated Amount of which, when added to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount U.S. Dollar Equivalent of the Letter of Credit Obligations then outstanding will not Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and prior to the issuance of, the respective Letter of Credit) at such time, would exceed either (x) the Letter of Credit Sub-Limit Commitment or (y) when added to the aggregate Original Dollar Amount of all Revolving Loans and (B) the sum U.S. Dollar Equivalent of the aggregate principal or undrawn amount of Swing Loans then outstanding, the then-outstanding Total Commitment at such time; (Iii) each Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent shall have an expiry date occurring not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of one year after such Letter of Credit.
's date of issuance (d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue although any Letter of Credit in may be extendible (whether automatically or otherwise) for successive periods of up to 12 months, but not beyond the period commencing on the first tenth Business Day preceding the Maturity Date), on terms reasonably acceptable to the respective Letter of Credit Issuer and in no event shall any Letter of Credit have an expiry date occurring later than the tenth Business Day preceding the Maturity Date; (iii) each Letter of Credit shall be denominated in U.S. Dollars or Canadian Dollars; (iv) each Letter of Credit shall be payable only on a sight basis and upon conditions, if any, set forth therein; and (v) no Letter of Credit Issuer shall issue any Letter of Credit after it receives has received written notice from the Administrative Agent Borrower or any Lender the Required Banks that one or more a Default exists until such time as such Letter of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Credit Issuer shall not otherwise be required to determine that, have received written notice of (x) rescission of such notice from the party or take notice whether, parties originally delivering the conditions precedent set forth in Section 3.2 have been satisfied in connection with same or (y) waiver of such Default by the issuance of any Letter of CreditRequired Banks.
(ec) If requested by Upon the relevant Issuer, prior occurrence of an event giving rise to the issuance operation of each Letter of Credit by such Issuer, and as a condition of such issuanceSection 2A.1(a)(iii), the Borrower shall have delivered the right, if no Default then exists, to replace such Issuer a letter Bank (the "Replaced Bank") with one or more other Eligible Transferees (it being acknowledged that the Replaced Bank shall be under no obligation to identify or secure the commitment of credit reimbursement agreement, such Eligible Transferee or assist in identifying or securing the commitment of such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”Eligible Transferee), signed by the Borrower, and such other documents or items as may each of whom shall be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide acceptable to the Administrative Agent (and collectively, the Administrative Agent shall provide a copy to each Lender requesting the same"Replacement Bank"), provided that (i) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective time of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer replacement pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h2A.1(c), such Issuer the Replacement Bank shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.enter into one
Appears in 1 contract
Letters of Credit. (a) On the date upon which the initial Revolving Loans under this Agreement are made, the Existing Letter of Credit shall be deemed to have been issued pursuant hereto, and from and after such date, the Existing Letter of Credit shall be subject to and governed by the terms and conditions of this Agreement. On and following the Initial Funding Date, subject to the terms and conditions contained set forth herein:
(i) the Issuing Lender agrees, in reliance upon the agreements of the other Lenders set forth in this AgreementSection 2.4, each Issuer agrees (1) from time to Issue one or more time on any Business Day during the period from the Initial Funding Date until the Letter of Credit Expiration Date, to issue Letters of Credit at the request of the Borrower for the account of Borrower, and to amend Letters of Credit previously issued by it, in accordance with subsections (d) and (e) below, and (2) to honor drafts under the Borrower from time Letters of Credit; and
(ii) the Revolving Lenders severally agree to time during participate in Letters of Credit in accordance with their respective Pro Rata Shares; provided that the period commencing on the Closing Date Issuing Lender shall not be obligated to make any Credit Extension with respect to any Letter of Credit, and ending on the earlier no Lender shall be obligated to participate in any Letter of Credit if as of the date of such Credit Extension, (y) the Revolving Obligations exceed the then applicable Revolving Commitment or (z) the Aggregate Effective Amount exceeds $15,000,000. Each Letter of Credit Termination Date and 30 days prior which results in the outstanding Revolving Obligations being in excess of $25,000,000 shall also be subject to the Revolving Loan Maturity Date; provided, however, that no Issuer fulfillment of the conditions precedent set forth in Section 8.3.
(b) The Issuing Lender shall be under any no obligation to Issue issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority Government Agency or arbitrator shall purport by its terms purport to enjoin or restrain such Issuer the Issuing Lender from issuing such Letter of Credit Credit, or any Requirement of Law applicable to such Issuer the Issuing Lender or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibitGovernment Agency prohibits, or request requests that such Issuer the Issuing Lender refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer the Issuing Lender with respect to such Letter of Credit any restriction or restriction, reserve or capital requirement (for which such Issuer the Issuing Lender is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees Issuer, in its sole discretion, may elect to Issue at the request of any Borrower and for the account of such Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity DatePeriod; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v), and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit aggregate Commitments in effect at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, (A) the sum of (i) the Dollar Equivalents of the aggregate undrawn face amount of all Letters of Credit Issued by such Issuer outstanding at such time and (ii) the Dollar Equivalent of the Reimbursement Obligations owed to such Issuer at such time exceeds such Issuer’s L/C Commitment or (B) the sum of (i) the Dollar Equivalents of the Letter of Credit Undrawn Amounts at such time and (ii) the Dollar Equivalents of the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any fees due and payable in connection with a requested issuance have not been paidcurrency other than Dollars or Euros; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days Business Days prior to the Revolving Loan Initial Scheduled Maturity Date (or, (A) with respect to any Letter of Credit Issued by any Issuer that has consented to the First Extension, if each of the conditions set forth in Section 2.21(b) with respect to the First Extension shall have been satisfied, the First Extended Maturity Date or (B) with respect to any Letter of Credit Issued by any Issuer that has consented to the Second Extension, if each of the conditions set forth in Section 2.21(b) with respect to the Second Extension shall have been satisfied, the Second Extended Maturity Date); provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (x) on or before the expiration of each such term and each such period, the applicable Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) such Borrower shall not permit any such renewal to extend the expiration date of any Letter beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the applicable Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount requested (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. whose Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer$1,000,000), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the Person case of an issuance, the person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum aggregate Revolving Credit Commitments at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any currency other than Dollars;
(A) any fees due and payable in connection with a requested issuance Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in form and substance reasonably acceptable to it and, if applicable, duly executed by the Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit; or
(vivii) such Letter of Credit is not denominated in Dollars or in an Alternative Currencya Standby Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as (x) on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) neither the Issuer of such Letter of Credit nor the Borrower shall permit any such renewal to extend the expiration date of any Letter of Credit beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D H (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated Credit and face amount of the Letter of Credit requested, requested (which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer$1,000,000), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.42.3, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.4.2
Appears in 1 contract
Samples: Revolving Credit Agreement (Boardwalk Pipeline Partners, LP)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of each Borrower and for the account of such Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Scheduled Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx fxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum aggregate Revolving Credit Commitments at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount of Letter of applicable Borrower’s Revolving Credit Obligations then outstanding Outstandings would exceed the Letter of its Revolving Credit Sublimit;; Exhibit 10.2 BWP 10-Q 06/30/2009 Exhibit 10.2 -----
(v) such Letter of Credit is requested to be denominated in any currency other than Dollars;
(A) any fees due and payable in connection with a requested issuance Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in form and substance reasonably acceptable to it and, if applicable, duly executed by the applicable Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit; or
(vivii) such Letter of Credit is not denominated in Dollars or in an Alternative Currencya Standby Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Revolving Loan Scheduled Maturity Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as (x) on or before the expiration of each such term and each such period, the applicable Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) neither the Issuer of such Letter of Credit nor the applicable Borrower shall permit any such renewal to extend the expiration date of any Letter of Credit beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the applicable Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D H (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall specify (i) specify (A) the Issuer of such Letter of Credit, (ii) the stated face amount of the Letter of Credit requested, requested (which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer$1,000,000), (Biii) the date of issuance Issuance of such requested Letter of Credit (which day date shall be a Business Day), (Civ) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (Dv) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.42.3, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the applicable Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.4.2
Appears in 1 contract
Samples: Revolving Credit Agreement (Boardwalk Pipeline Partners, LP)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each (x) the Dollar/Euro Issuer agrees to Issue at the request of the Company and for the account of the Company and (y) the Yen Issuer agrees to Issue at the request of the Japanese Borrower and for the account of the Japanese Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 5 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, the applicable Borrower or, in the case of the Yen Issuer any Yen Revolving Credit Lender or in the Borrowercase of the Dollar/Euro Issuer, any Dollar/Euro Revolving Credit Lender, on or prior to the requested date of issuance Issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On The Letter of Credit Commitment.
(i) Subject to the terms and conditions set out herein, L/C Issuer agrees, from time to time on any Business Day during the period from the Closing Date until the Maturity Date, to issue Standby Letters of Credit, for the account of Borrowers, and to amend or renew such Letters of Credit previously issued by it, in accordance with Section 2.03(b) below; provided that L/C Issuer shall not be obligated to make any L/C Credit Extension with respect to any such Standby Letter of Credit, if as of the date of such L/C Credit Extension, the L/C Obligations for Standby Letters of Credit would exceed, with respect to the Tranche B Letter of Credit, the Tranche B Letter of Credit Limit and with respect to all other Letters of Credit, the Letter of Credit Limit. Within the foregoing limits, and subject to the terms and conditions contained in this Agreementhereof, each Issuer agrees Borrowers’ ability to Issue one or more obtain Letters of Credit at the request of the Borrower for the account of the Borrower from time to time shall be fully revolving, and, accordingly, Borrowers may, during the period commencing on the Closing Date foregoing period, obtain Letters of Credit to replace Letters of Credit that have expired or that have been drawn upon and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no reimbursed.
(ii) L/C Issuer shall be under any no obligation to Issue issue any Letter of Credit if:
(iA) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms purport to enjoin or restrain such L/C Issuer from issuing such Letter of Credit Credit, or any Requirement of Law applicable to such L/C Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such L/C Issuer shall prohibit, or request that such L/C Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such L/C Issuer with respect to such Letter of Credit any restriction or restriction, reserve or capital requirement (for which such L/C Issuer is not otherwise compensatedcompensated under this Agreement) not in effect on the date of this Agreement Closing Date, or result in shall impose upon L/C Issuer any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of applicable on the date of this Agreement Closing Date and which such L/C Issuer in good xxxxx fxxxx xxxxx material to it;
(iiB) the expiry date of such Issuer shall have received written notice from requested Letter of Credit would occur more than twelve months after the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of or last renewal, (provided that such Letter of CreditCredit may include provisions for automatic renewal), that one or more of the applicable conditions contained unless L/C Issuer has approved such expiry date in Section 3.1 and Section 3.2 is not then satisfiedadvance;
(iiiC) after giving effect to the issuance expiry date of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of requested Letter of Credit Obligations then outstanding would exceed occur after the Letter of Credit Sublimit;Expiration Date or the Tranche B Letter of Credit Expiration Date, as applicable, unless L/C Issuer has approved such expiry date in advance; or 1335940v11
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(viD) such Letter of Credit is not in an initial amount less than $25,000, or is to be denominated in Dollars or in an Alternative Currency. None of the Lenders (a currency other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of CreditDollars.
(biii) In L/C Issuer shall be under no event shall the expiration date of obligation to amend any Letter of Credit if (iA) be more than one year after L/C Issuer would have no obligation at such time to issue such Letter of Credit in its amended form under the date of issuance thereofterms hereof, or (iiB) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance beneficiary of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) does not accept the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is proposed amendment to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower (or for the joint account of the Borrower and any of its Restricted Subsidiaries) one or more Letters of Credit at the request of the Borrower for the account of the Borrower in Dollars or an Alternative Currency from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and to the extent relating to any fees owing to the Issuer of such Letter of Credit or its Affiliates, (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement Amendment No. 3 Effective Date or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement Amendment No. 3 Effective Date and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, (A) the sum of (i) the Dollar Equivalents of the aggregate undrawn face amount of all Letters of Credit Issued by such Issuer outstanding at such time and (ii) the Dollar Equivalent of the Reimbursement Obligations owed to such Issuer at such time exceeds such Issuer’s L/C Commitment or (B) the sum of (i) the Dollar Equivalents of the Letter of Credit Undrawn Amounts at such time and (ii) the Dollar Equivalents of the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(viA) such Letter of Credit is not requested to be denominated in any Alternative Currency and such Issuer receives written notice from the Administrative Agent at or before 11:00 a.m. (New York time) on the date of the proposed Issuance of such Letter of Credit that, immediately after giving effect to the Issuance of such Letter of Credit, the Dollar Equivalent of all Letter of Credit Obligations at such time in respect of each Letter of Credit denominated in (x) Euros, would exceed $25,000,000 or (y) Sterling, would exceed $25,000,000 or (B) such Letter of Credit is requested to be denominated in any currency other than Dollars or in an Alternative Currency; AMENDED AND RESTATED CREDIT AGREEMENT XXXXX HEALTHCARE CORPORATION
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit. None of the Issuers shall be required to issue any Documentary Letter of Credit unless otherwise agreed in writing by the relevant Issuer.
(b) In no event shall the expiration date of any Letter of Credit be (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Revolving Loan Maturity Credit Termination Date, unless consented to by the applicable Issuer in such Issuer’s sole discretion; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the automatic renewal thereof for additional periods less than or equal to one year, as long as, on or before the expiration of each such term and each such period, each of the Borrower and the Issuer of such Letter of Credit shall have the option to prevent such automatic renewal; provided, further, that, for any Letter of Credit having an expiration date after the Revolving Credit Termination Date, the Borrowers agree to cash collateralize or backstopped pursuant to arrangements reasonably acceptable to the relevant Issuer.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least (x) two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in the case of any Letter of Credit to be denominated in Dollars and (y) four Business Days’ prior written notice, in the case of any Letter of Credit to be denominated in an Alternative Currency, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance date of such Issuance for any Letter of CreditCredit to be Issued in Dollars and the fourth Business Day prior to the requested date of Issuance for any Letter of Credit to be Issued in an Alternative Currency.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Revolving Credit Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On Subject to the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower Borrower, for the account of the Borrower or a Subsidiary (provided that any Letter of Credit issued for the benefit of any Subsidiary that is not the Borrower shall be issued naming the Borrower as the account party on any such Letter of Credit but such Letter of Credit may contain a statement that it is being issued for the benefit of such Subsidiary), one or more Standby Letters of Credit denominated in Dollars from time to time on any Business Day during the period commencing on the Closing first Business Day after the Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days five (5) Business Days prior to the Revolving Loan Maturity DateDate (without giving effect to any extension of the type referred to in Section 12.1(b) hereof) (or, if such day is not a Business Day, the next preceding Business Day), or such later date as agreed to by the Administrative Agent in its sole discretion; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv) and (v)(A) below, shall not Issue) any Letter of Credit if:
upon the occurrence of any of the following: (i) any order, judgment or decree of any Governmental Authority or arbitrator having binding powers shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement Effective Date or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement Effective Date and which that such Issuer in good xxxxx xxxxx material to it;it (for which such Issuer is not 5339129.14 46
(iiA) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in form and substance reasonably acceptable to it and, if applicable, duly executed by the Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer shall have received written notice from generally employs in the Administrative Agent, any Lender or ordinary course of its business for the Borrower, on or prior to Issuance of letters of credit of the requested date of issuance type of such Letter of Credit; (vi) any Revolving Credit Lender is at that time a Defaulting Lender, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
unless (iiii) after giving effect to the issuance requested Issuance, there would exist no Fronting Exposure (in the good faith determination of the applicable Issuer) or (ii) the applicable Issuer has entered into arrangements, including the delivery of Cash Collateral, satisfactory to the applicable Issuer (in its good faith determination) with the Borrower or such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at Lender to eliminate such time;
Issuer’s actual or potential Fronting Exposure (iv) after giving effect to Section 2.15(a)(iv)) with respect to the issuance of such Defaulting Lender arising from either the Letter of Credit, the aggregate amount of Credit then proposed to be issued or any other Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable as to which such Issuer has actual or potential Fronting Exposure, as it may elect in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currencyits sole discretion. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit. Any Letter of Credit which has been or deemed Issued hereunder may be amended at any time to reduce the amount outstanding thereunder.
(b) In no event shall the expiration date of any Letter of Credit be later than the earlier of (i) be more than one (1) year after the date of issuance thereof, thereof or (ii) be less than five days (5) Business Days prior to the Revolving Loan Maturity Date; provided, however, that any Letter of Credit may provide for the renewal thereof for additional periods of up to one (1) year on customary terms (which in no event shall extend beyond the date five (5) Business Days prior to the Maturity Date), as long as, on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter of Credit shall have the option to prevent such renewal.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two three (3) Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (or in such other written or electronic form as is acceptable to the such Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.5339129.14 47
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall 4.2 or clause (a) above (other than those conditions set forth in clauses (a)(i), (a)(v)(B) and (C) above and, to the extent such clause relates to fees owing to the Issuer of such Letter of Credit and its Affiliates, clause (a)(v)(A) above) are not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 4.2 have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If The Borrower agrees that, if requested by the relevant Issuer, Issuer of any Letter of Credit prior to the issuance of each a Letter of Credit by such IssuerCredit, and as it shall execute a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant Agreement in respect to the terms thereofany Letter of Credit Issued hereunder. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
shall comply with the following: (i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance or renewal Issuance of a any Letter of Credit Issued by itit (including the applicable currency), of all drawings under a any Letter of Credit Issued by it and of the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
; and (ii) upon on the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 first Business Days following the last day Day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations and applicable currencies, in each case outstanding at the end of each month the immediately preceding month, and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a any Letter of Credit Credit, in each case in Dollars and in an equivalent amount, and, to the amount of extent so financed, all Reimbursement Obligations owing to such Issuer under a any Letter of Credit when issued for its account no later than (x) within one (1) Business Day after the Borrower receives written notice from such amounts are due Issuer that payment has been made under such Letter of Credit in accordance with its terms if such notice is received by the Borrower by 11:00 a.m. and payable(y) on the second (2nd) Business Day after which the Borrower receives written notice from such Issuer that payment has been made under such Letter of Credit in accordance with its terms if such notice is received by the Borrower after 11:00 a.m. (such date described in clause (x) or (y) above, the “Reimbursement Date”), irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit in accordance with its terms and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) (directly or by application of the deemed Loans described below in this clause (h) or by virtue of the penultimate sentence of this clause (h)) or any such payment by the Borrower is rescinded or set aside for any reason, such Reimbursement Obligation shall bear be payable in the applicable currency on demand with interest thereon computed (i) from the date on which such Reimbursement Obligation arose to the date of repayment in full Reimbursement Date, at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such periodperiod to Base Rate Loans, and (ii) from the Reimbursement Date until the date of repayment in full, at the rate of interest applicable during such period to past due Loans that are Base Rate Loans, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligationfailure, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made Same Day Funds in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available fundsapplicable currency. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available fundsSame Day Funds in the applicable currency. Upon such payment by a Lender, such Lender shall shall, except during the continuance of a Default or Event of Default under Section 10.1(f) and notwithstanding whether or not the conditions precedent set forth in Section 3.2 4.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) ), be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay over to the Administrative Agent and any amount received in excess of such Reimbursement Obligation and, upon receipt of such amount, the Administrative Agent shall promptly pay over to each Lender, in immediately available fundsSame Day Funds in the applicable currency, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(A) In the absence of written notice to the contrary from the Borrower, and subject to the other provisions of this Agreement (but without regard to the conditions to borrowing set forth in Section 4.2), Reimbursement Obligations shall be financed 5339129.14 49
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Each Defaulting Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Federal Funds Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Base Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation obligations to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, irrevocable and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
of any of the following: (i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
; (ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
; (iii) the existence of any claim, set set-off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the any Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
; (iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
; (v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply strictly comply, but that does substantially comply, with the terms of such Letter of Credit; and
and (vi) any other act or omission to act or delay of any kind of the any Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this SectionSection 2.4, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.5339129.14 50
Appears in 1 contract
Samples: Credit Agreement (eHealth, Inc.)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower (or for the joint account of the Borrower and any of its Subsidiaries) one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and to the extent relating to any fees owing to the Issuer of such Letter of Credit or its Affiliates, (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;; AMENDED AND RESTATED CREDIT AGREEMENT XXXXX HEALTHCARE CORPORATION
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, (A) the sum of (i) the Dollar Equivalents of the aggregate undrawn face amount of all Letters of Credit Issued by such Issuer outstanding at such time and (ii) the Dollar Equivalent of the Reimbursement Obligations owed to such Issuer at such time exceeds such Issuer’s L/C Commitment or (B) the sum of (i) the Dollar Equivalents of the Letter of Credit Undrawn Amounts at such time and (ii) the Dollar Equivalents of the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any fees due and payable in connection with a requested issuance have not been paidcurrency other than Dollars; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit be (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Revolving Loan Maturity Credit Termination Date, unless consented to by the applicable Issuer in such Issuer’s sole discretion; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the automatic renewal thereof for additional periods less than or equal to one year, as long as, on or before the expiration of each such term and each such period, each of the Borrower and the Issuer of such Letter of Credit shall have the option to prevent such automatic renewal.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.. AMENDED AND RESTATED CREDIT AGREEMENT XXXXX HEALTHCARE CORPORATION
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Revolving Credit Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer Issuing Bank agrees to Issue Issue, at the request of the Seller, and in favor of the beneficiaries requested by the Seller, one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on from the Closing Effective Date and ending on to and including the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Commitment Termination Date; provided, however, that no Issuer Issuing Bank shall be under any obligation to Issue any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer Issuing Bank from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer Issuing Bank shall prohibit, or request that such Issuer refrain Issuing Bank refrains from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer Issuing Bank with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer Issuing Bank is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer Issuing Bank as of the date of this Agreement and which that such Issuer Issuing Bank in good xxxxx fxxxx xxxxx material to it;
(ii) such Issuer Issuing Bank shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Capital plus the aggregate Letter of Credit Outstandings Undrawn Amounts at such time would exceed the Maximum Credit at such timelesser of (a) the Total Commitment and (b)
(i) the Net Receivables Pool Balance minus (ii) the Applicable Reserve;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations then outstanding at such time would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance Issuance have not been paid; or;
(vi) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuing Bank; or
(vii) such Letter of Credit is requested to be denominated in Dollars or in an Alternative Currencyany currency other than U.S. Dollars. None of the Lenders Purchasers (other than the Issuers each Issuing Bank in their its capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof; provided, or (ii) be less than five days prior to however, that any Letter of Credit with a one-year term may provide for the Revolving Loan Maturity Daterenewal thereof for additional one-year periods.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower Seller shall give the relevant Issuer applicable Issuing Bank and the Administrative Agent at least two 3 Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D H (or in such other written or electronic form as is acceptable to the Issuerapplicable Issuing Bank), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), ) and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer applicable Issuing Bank and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) third Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.42.04, the relevant Issuer applicable Issuing Bank shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower Seller (or any Affiliate of the Seller acceptable to the Agent in its sole discretion) in accordance with such IssuerIssuing Bank’s usual and customary business practices. No Issuer Issuing Bank shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender Purchaser that one or more of the conditions precedent contained in Section 3.2 3.02 shall not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant Issuer Issuing Banks shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 3.02 have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If requested by the relevant Issuerapplicable Issuing Bank, prior to the issuance of each Letter of Credit by such Issuer, Issuing Bank and as a condition of such issuanceIssuance and of the participation of each Purchaser in the Letter of Credit Obligations arising with respect thereto, the Borrower Seller shall have delivered to such Issuer the applicable Issuing Bank a letter of credit reimbursement agreement, in such form as the Issuer such Issuing Bank may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the BorrowerSeller, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer Issuing Bank shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance Issuance or renewal of a Letter of Credit Issued issued by it, of all drawings under a Letter of Credit Issued issued by it and the payment (or the failure to pay when due) by the Borrower Seller of any Reimbursement Obligation when due (which each such notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each LenderPurchaser);
(ii) upon the request of any LenderPurchaser, furnish to such Lender Purchaser copies of any Letter of Credit Reimbursement Agreement to which such Issuer Issuing Bank is a party and such other documentation as may reasonably be requested by such LenderPurchaser; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender Purchaser requesting the same) and the Borrower separate schedules ), a schedule for Documentary and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower Seller or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer Issuing Bank of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer Issuing Bank shall be deemed to have sold and transferred to each LenderPurchaser, and each Lender Purchaser shall be deemed irrevocably and unconditionally to have purchased and received from such IssuerIssuing Bank, without recourse or warranty, an undivided interest and participation, to the extent of such LenderPurchaser’s Ratable Portion of the Revolving Credit Commitmentsratable portion, in such Letter of Credit and the obligations of the Borrower Seller with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower If, and to the extent, any Reimbursement Obligations have not been repaid pursuant to Section 2.07 or 2.08, the Seller agrees to pay to the Issuer of a Letter of Credit applicable Issuing Bank the amount of all Reimbursement Obligations owing to such Issuer Issuing Bank under a any Letter of Credit when issued for its account or at its direction no later than the date that is the next succeeding Business Day after the Seller receives written notice from such amounts are due and payableIssuing Bank that payment has been made under such Letter of Credit (the “Reimbursement Date”), irrespective of any claim, set-off, defense or other right that the Borrower Seller may have at any time against such Issuer Issuing Bank or any other Person. In the event that any Issuer an Issuing Bank makes any payment under any Letter of Credit and the Borrower Seller shall not have repaid such amount to such Issuer Issuing Bank pursuant to this clause (hSection 2.04(h) or any such payment by the Seller is rescinded or set aside for any reason, such Reimbursement Obligation shall bear be payable on demand with interest thereon computed (i) from the date on which such Reimbursement Obligation arose to the date of repayment in full Reimbursement Date, at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, with respect to past due Capital initially bearing Yield based on the Alternate Base Rate and (ii) from the Reimbursement Date until the date of repayment in full, at the rate of interest applicable during such Issuer period, with respect to past due Capital initially bearing Yield based on the Adjusted LIBO Rate, and the applicable Issuing Bank shall promptly notify the Administrative Agent, which shall promptly notify each Lender Purchaser of the failure to repay such Reimbursement Obligationfailure, and each Lender Purchaser shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer Issuing Bank the amount of such LenderPurchaser’s Ratable Portion ratable share of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender Purchaser prior to 11:00 a.m. (New York City time) on any Business Day, such Lender Purchaser shall make available to the Administrative Agent for the account of such Issuer the applicable Issuing Bank its Ratable Portion ratable share of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a LenderPurchaser, such Lender shall Purchaser shall, except during the continuance of an Event of Termination under Section 7.01(f) and notwithstanding whether or not the conditions precedent set forth in Section 3.2 3.02 shall have been satisfied (which conditions precedent the Lenders Purchasers hereby irrevocably waive) ), be deemed to have made a Revolving Loan Purchase, and the Seller shall be deemed to the Borrower have received a Collection, in respect of a Receivable Interest in the principal amount of such payment and the Capital of such Receivable Interest shall be increased by the amount of such payment. Whenever any Issuer an Issuing Bank receives from the Borrower Seller a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer Issuing Bank any payment from a Lender Purchaser pursuant to this clause (hSection 2.04(h), such Issuer the applicable Issuing Bank shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, Purchaser in immediately available funds, an amount equal to such LenderPurchaser’s Ratable Portion ratable share of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders Purchasers have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender Purchaser shall not have so made its Ratable Portion ratable portion of the amount of the payment required by clause (hSection 2.04(h) above available to the Administrative Agent for the account of the applicable Issuing Bank, such Purchaser agrees to pay to the Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer Issuing Bank forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Federal Funds Rate and, thereafter, thereafter until such amount is repaid to the Administrative Agent for the account of such IssuerIssuing Bank, at a the rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment Capital initially bearing Yield based on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such paymentAlternate Base Rate.
(j) The BorrowerSeller’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders Purchasers to make payments to the Administrative Agent for the account of the Issuers applicable Issuing Bank with respect to Letters of Credit shall be absolute, unconditional and irrevocable, irrevocable and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of DefaultTermination, and irrespective ofof any of the following:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Transaction Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Transaction Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the BorrowerSeller, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuersuch Issuing Bank, the Administrative Agent or any Lender Purchaser or any other Person, whether in connection with this Agreement, any other Loan Transaction Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer such Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuersuch Issuing Bank, the LendersPurchasers, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this SectionSection 2.04, constitute a legal or equitable discharge of the BorrowerSeller’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer an Issuing Bank under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer Issuing Bank under any resulting liability to the Borrower Seller or any LenderPurchaser. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer applicable Issuing Bank may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer Credit, such Issuing Bank may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever whatsoever, and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuersuch Issuing Bank.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On The Issuing Bank agrees, on the terms and subject to the conditions contained in this Agreementhereinafter set forth, each Issuer agrees to Issue for the account of one or more of the Borrowers, one or more Letters of Credit at the request of the Borrower for the account of the Borrower denominated in Dollars from time to time during the period commencing on from the Closing Date and ending until the Maturity Date in an aggregate undrawn amount not to exceed at any time $5,000,000, each such Letter of Credit upon its Issuance to expire on or before the earlier of (x) the Revolving Credit Termination Date and 30 date which occurs one year from the date of its Issuance or (y) thirty days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer the Issuing Bank shall not be under any obligation obligated (or permitted) to Issue any Letter of Credit if:
(a) after giving effect to the Issuance of such Letter of Credit, the sum of (i) the Outstanding Loans and (ii) the Outstanding Letter of Credit Liability shall exceed the Available Total Commitment;
(b) the Agent or the Required Lenders shall have notified the Issuing Bank and the Borrowers that no further Letters of Credit are to be Issued by the Issuing Bank due to a continuing failure to meet any of the applicable conditions set forth in 10 or 11, and such notice has not expired or been withdrawn by the Agent or the Required Lenders;
(c) any order, judgment or decree decrees of any Governmental Authority or arbitrator arbitration shall purport by its terms purport to enjoin or restrain such Issuer the Issuing Bank from issuing such Letter of Credit Credit, or any Requirement requirement of Law law or regulation applicable to such Issuer the Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer the Issuing Bank shall prohibit, or request that such Issuer the Issuing Bank refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer the Issuing Bank with respect to such Letter of Credit any restriction or restriction, reserve or capital requirement (for which such Issuer the Issuing Bank is not otherwise compensated) not in effect on the date of this Agreement Closing Date and which results in an unreimbursed loss, cost or result in expense or shall otherwise impose upon the Issuing Bank any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of applicable on the date of this Agreement and which such Issuer in good xxxxx xxxxx material to itClosing Date;
(iid) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed does not provide for drafts, or is not otherwise in form and substance acceptable to the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paidIssuing Bank; or
(vie) such any Letter of Credit is not denominated in Dollars or in an Alternative Currency. None for the purpose of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with supporting the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as by any Person other than the Issuer may employ in its ordinary course Issuing Bank. Within the limits of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter Issuing Bank set forth above, the Borrowers may request the Issuing Bank to Issue one or more Letters of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to Credit, reimburse the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer Issuing Bank for payments made thereunder pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period3.3(a), and such Issuer shall promptly notify request the Administrative Agent, which shall promptly notify each Lender of the failure Issuing Bank to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether Issue one or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to more additional Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer3.1.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Revolving Credit Agreement (Dynamics Research Corp)
Letters of Credit. If any change in any Legal Requirement or in the interpretation thereof by any court or administrative or Governmental Authority charged with the administration thereof shall either (ai) On impose, modify, or deem applicable any reserve, special deposit, or similar requirement against letters of credit issued by, or assets held by, or deposits in or for the terms and subject account of, the Issuing Bank or any Bank or (ii) impose on the Issuing Bank or any Bank any other condition regarding the provisions of this Agreement relating to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue or any Letter of Credit if:
Obligations, and the result of any event referred to in the preceding clause (i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from be to increase the Administrative Agent, any Lender or the Borrower, on or prior cost to the requested date Issuing Bank of issuance of such issuing or maintaining any Letter of Credit, that one or more increase the cost to such Bank of the applicable conditions contained its risk participation in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) which increase in cost shall be more than one year after determined by the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (Issuing Bank’s or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum Bank’s reasonable allocation of the aggregate principal or undrawn amount of the such cost increases resulting from such event), then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received upon demand by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (Issuing Bank or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
Bank (d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory sent to the Administrative Agent), setting forth as the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by case may be, the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer Issuing Bank), as the case may be, from time to time as specified by the Issuing Bank or such other Lender’s Ratable Portion of any Bank, additional amounts which shall be sufficient to compensate the Issuing Bank or such payment.
Bank for such increased cost. The Issuing Bank and each Bank agrees to use commercially reasonable efforts (jconsistent with internal policy and legal and regulatory restrictions) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent designate a different Applicable Lending Office for the account booking of the Issuers with respect to its Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with or risk participations if the terms making of such designation would avoid the effect of this Agreementparagraph and would not, under any and all circumstances whatsoeverin the reasonable judgment of the Issuing Bank or such Bank, including be otherwise disadvantageous to the occurrence Issuing Bank or such Bank, as the case may be. A certificate as to such increased cost incurred by the Issuing Bank or such Bank, as the case may be, as a result of any Default or Event of Default, and irrespective of:
event mentioned in clause (i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment above, and detailing the calculation of such increased costs submitted by the Issuing Bank or waiver of or any consent such Bank to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent conclusive and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by itbinding for all purposes, absent manifest error.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the U.S. Borrower and for the account of the U.S. Borrower or any of the U.S. Borrower’s Restricted Subsidiaries one or more Letters of Credit at the request of the Borrower for the account of the U.S. Borrower or its Restricted Subsidiaries from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date (provided that, notwithstanding the foregoing, the Issuer may, in its sole discretion, elect to issue Letters of Credit at any time prior to the Scheduled Termination Date); provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator having binding powers shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement Effective Date or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement Effective Date and which that such Issuer in good xxxxx fxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, (a) the aggregate Revolving Credit Outstandings would exceed the U.S. Maximum Credit at such time or (b) the aggregate U.S. Revolving Credit Outstandings would exceed the U.S. Borrowing Base at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Dollar Equivalent of the Letter of Credit Undrawn Amounts at such time and (ii) the Dollar Equivalent of the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any fees due currency other than Dollars, Euros or Sterling except as may be approved by the Administrative Agent and payable the Issuer, each in connection with a requested issuance have not been paidtheir sole discretion; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit. Any Letter of Credit which has been or deemed Issued hereunder may be amended at any time at the request of the U.S. Borrower to reduce the amount outstanding thereunder.
(b) In no event shall the expiration date of any Letter of Credit be (i) be more than one year after the date of issuance thereof, thereof or (ii) be later than the Scheduled Termination Date (unless, in the case of this clause (ii), the Borrowers comply with the following provisions of this clause (b)); provided, however, that any Letter of Credit with a term less than five days or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, on or before the expiration of each such term and each such period, the U.S. Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal; and provided, further, that, for any Letter of Credit having an expiration date after the Scheduled Termination Date, the Borrowers agree to deliver to the Administrative Agent on or prior to the Revolving Loan Maturity DateScheduled Termination Date a letter of credit or letters of credit in form and substance acceptable to the Administrative Agent and issued by a bank reasonably acceptable to the Administrative Agent, and/or cash collateral in an amount equal to 103% of the maximum drawable amount of any such Letter of Credit and in the currency in which such Letter of Credit is denominated.
(c) In connection with the issuance Issuance of each Letter of Credit, the U.S. Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D B-3 (or in such other written forward by electronic mail or similar means an electronic form image scan transmission of a duly executed Letter of Credit Request (as is acceptable to the Issuerdefined below)), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall specify (i) specify (A) the Issuer of such Letter of Credit, if there is more than one Issuer, (ii) the stated currency of issuance and the face amount of the Letter of Credit requestedrequested (the Dollar Equivalent of which shall not, which stated amount without the consent of the Administrative Agent, be less than $100,000 on the date of Issuance of such requested Letter of Credit), (or, if iii) whether such Letter of Credit is to be denominated in Dollars a bank guarantee or an Alternative Currency letter or credit, (other than U.S. Dollars), iv) the U.S. Dollar Equivalent requested date of Issuance of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer)letter of credit, (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (Cv) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (Dvi) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) last Business Day (or on which such shorter period as agreed by notice can be given under the relevant Issuer) prior to the requested issuance of such Letter of Creditimmediately preceding sentence.
(d) Subject to the satisfaction (or waiver) of the conditions set forth in this Section 2.42.04, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the U.S. Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Revolving Credit Lender that one or more of the conditions precedent contained in Section 3.2 shall 4.02 or clause (a) above (other than those conditions set forth in clauses (a)(i), (a)(vi)(B) and (C) above and, to the extent such clause relates to fees owing to the Issuer of such Letter of Credit and its Affiliates, clause (a)(vi) (A) above) are not on such date be satisfied, satisfied or waived and ending when such conditions are satisfiedsatisfied or waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 4.02 have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Credit Agreement (Solutia Inc)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower of, and for the account of, the Borrower to support obligations of the Borrower Borrower, any of its Subsidiaries or any Joint Ventures from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on (i) in the case of a Revolving Letter of Credit, the earlier of the Revolving Credit Facility Termination Date and 30 days prior to May 6, 2011 and (ii) in the Revolving Loan Maturity Datecase of a Synthetic Letter of Credit, the earlier of the Synthetic Facility Termination Date and May 6, 2012; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On Subject to and upon the terms and subject ----------------- conditions herein set forth, the Borrower may request a Letter of Credit Issuer at any time and from time to time after the Initial Borrowing Date and prior to the conditions contained Business Day (or the 30th day in this Agreement, each Issuer agrees to Issue one or more the case of trade Letters of Credit at Credit) preceding the request of the Borrower Revolving Loan Maturity Date to issue, for the account of the Borrower and in support of, (A) trade obligations of the Borrower or any of its Subsidiaries that arise in the ordinary course of business and are in respect of general corporate purposes of the Borrower or its Subsidiaries, as the case may be, and/or (B) on a standby basis, L/C Supportable Indebtedness, and subject to and upon the terms and conditions herein set forth each Letter of Credit Issuer agrees to issue from time to time during time, irrevocable letters of credit in such form as may be approved by such Letter of Credit Issuer (each such letter of credit, a "Letter of Credit" and, collectively, the period commencing on "Letters of Credit"). Notwithstanding the Closing Date and ending on the earlier foregoing, no Letter of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue issue any Letter of Credit ifif at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport by its terms to enjoin or restrain such Letter of Credit Issuer from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Letter of Credit Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such Letter of Credit Issuer shall prohibit, or request that such Letter of Credit Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Letter of Credit Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Letter of Credit Issuer is not otherwise compensated) not in effect on the date of this Agreement hereof, or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Letter of Credit Issuer as of the date of this Agreement hereof and which such Letter of Credit Issuer in good xxxxx xxxxx material to it;; or
(ii) such Letter of Credit Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or Required Banks prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, Credit of the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable type described in connection with a requested issuance have not been paid; or
clause (vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of CreditSection 2.01(b).
(b) In Notwithstanding the foregoing, (i) no event shall the expiration date of any Letter of Credit shall be issued the Stated Amount of which, when added to the Letter of Credit Outstandings (iexclusive of Unpaid Drawings relating to Letters of Credit which are repaid on the date of, and prior to the issuance of, the respective Letter of Credit) be more at such time, would exceed either (x) $10,000,000 or (y) when added to the aggregate principal amount of all Revolving Loans and Swingline Loans then outstanding, the Total Revolving Loan Commitment at such time; (ii) (x) each standby Letter of Credit shall have an expiry date occurring not later than one year after the such standby Letter of Credit's date of issuance thereofissuance, or provided, that -------- any standby Letter of Credit may be automatically renewable for periods of up to one year so long as such standby Letter of Credit provides that the respective Letter of Credit Issuer retains an option, satisfactory to such Letter of Credit Issuer, to terminate such standby Letter of Credit within a specified period of time prior to each scheduled renewal date and (iiy) be less each trade Letter of Credit shall have an expiry date occurring not later than five 180 days after such trade Letter of Credit's date of issuance; (iii) (x) no standby Letter of Credit shall have an expiry date occurring later than the Business Day next preceding the Revolving Loan Maturity Date and (y) no trade Letter of Credit shall have an expiry date occurring later than 30 days prior to the Revolving Loan Maturity Date; (iv) each Letter of Credit shall be denominated in U.S. Dollars and be payable on a sight basis; (v) the Stated Amount of each Letter of Credit shall not be less than $100,000 or such lesser amount as is acceptable to the Letter of Credit Issuer; and (vi) no Letter of Credit Issuer will issue any Letter of Credit after it has received written notice from the Borrower or the Required Banks stating that a Default or an Event of Default exists until such time as such Letter of Credit Issuer shall have received a written notice of (i) rescission of such notice from the party or parties originally delivering the same or (ii) a waiver of such Default or Event of Default by the Required Banks (or all the Banks to the extent required by Section 12.12), and any letter of credit issued by a Letter of Credit Issuer in contravention of this clause (vi) shall not constitute a Letter of Credit (including for purposes of Section 2.04).
(c) In connection with Notwithstanding the issuance of each foregoing, in the event a Bank Default exists, no Letter of Credit, Credit Issuer shall be required to issue any Letter of Credit unless the respective Letter of Credit Issuer has entered into arrangements satisfactory to it and the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of eliminate such Letter of Credit (a “Letter Issuer's risk with respect to the participation in Letters of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) of the Issuer of Defaulting Bank or Banks, including by cash collateralizing such Letter of Credit, the stated amount Defaulting Bank's or Banks' RL Percentage of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of CreditOutstandings.
(d) Subject to Annex X attached hereto contains a description of all letters of credit issued or deemed issued and outstanding under the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, Existing Credit Agreement on the requested dateEffective Date. Each such letter of credit, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue including any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfiedextension thereof (each, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any an "Existing Letter of Credit.
(e") If requested by the relevant Issuer, prior to the issuance of each shall constitute a "Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business Credit" for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions purposes of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lenderissued, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuerfor purposes of Section 2.04(a), without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement ObligationEffective Date.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On Subject to and upon the terms and subject conditions herein set forth, the Borrower, at any time and from time to time on or after the Closing Date and prior to the conditions contained in this AgreementL/C Maturity Date, each Issuer agrees to Issue one or more Letters may request that the Letter of Credit at the request of the Borrower Issuer issue, for the account of the Borrower from time to time during Borrower, a standby letter of credit or letters of credit in such form as may be approved by the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit if:Issuer in its reasonable discretion. Each Letter of Credit shall provide for drawings thereunder to be made in Dollars or, subject to Section 3.7, Sterling.
(b) Notwithstanding the foregoing, (i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such no Letter of Credit or any Requirement shall be issued the Stated Amount of Law applicable which, when added to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit Outstanding at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
Commitment then in effect; (vii) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such no Letter of Credit is not denominated in Dollars or in an Alternative Currency. None shall be issued the Stated Amount of which, when added to the Lenders sum of (other than x) the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit Outstanding at such time and (iy) be more the aggregate principal of all Revolving Credit Loans and Swingline Loans then outstanding, would exceed the Total Revolving Credit Commitment then in effect; (iii) each Letter of Credit shall have an expiry date occurring no later than one year after the date of issuance thereof, unless otherwise agreed upon by the Administrative Agent and the Letter of Credit Issuer, PROVIDED that in no event shall such expiry date occur later than the L/C Maturity Date; (iv) each Letter of Credit shall be denominated in Dollars; and (v) no Letter of Credit shall be issued by the Letter of Credit Issuer after it has received a written notice from the Borrower or any Lender stating that a Default or Event of Default has occurred and is continuing until such time as the Letter of Credit Issuer shall have received a written notice of (x) rescission of such notice from the party or parties originally delivering such notice or (iiy) be less than five days prior to the Revolving Loan Maturity Datewaiver of such Default or Event of Default in accordance with the provisions of Section 13.1.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent Upon at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a one Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) 's prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice promptly confirmed promptly thereafter in writing, which may be by telecopier) of to the issuance or renewal of a Administrative Agent and the Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due Issuer (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lenderof the Lenders);
(ii) upon , the request of Borrower shall have the right, on any Lenderday, furnish permanently to such Lender copies of any terminate or reduce the Letter of Credit Reimbursement Agreement Commitment in whole or in part, PROVIDED that, after giving effect to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following termination or reduction, the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at Outstanding shall not exceed the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining theretoCommitment.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On Subject to and upon the terms and subject to conditions herein set forth, including, without limitation, the applicable terms and conditions contained set forth in this AgreementSection 7 hereof, each Issuer the Bank agrees to Issue one or more Letters that it will, following its receipt of a Letter of Credit at the request of the Borrower Request, issue for the account of the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier in support of the Revolving Credit Termination Date and 30 days prior obligations of the Borrower, one or more irrevocable letters of credit which either (i) can be drawn down by a Buyer only if the Borrower fails to perform all of its obligations under an Export Order or Indirect Export Order, or (ii) can be drawn down by a United States supplier if the Revolving Loan Maturity DateBorrower fails to pay for goods or services purchased from said supplier by the Borrower in support of export sales to be made pursuant to an Export Order or Indirect Export Order (all such letters of credit collectively, the "Letters of Credit"); provided, however, provided that no Issuer the Bank shall be under any no obligation to Issue issue any Letter of Credit ifif at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer the Bank from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Issuer the Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer the Bank shall prohibit, or request that such Issuer the Bank refrain from, the issuance of letters of credit generally or generally; or
(ii) the Stated Amount of such Letter of Credit in particular or shall impose upon such Issuer with respect to such plus the Letter of Credit Outstandings at such time (subject to any restriction or reserve or capital requirement adjustment pursuant to Section 2.3(c), if any) and the aggregate principal amount of all Loans then outstanding (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the principal amount of all Loans repaid and all Unpaid Drawings reimbursed prior to or concurrently with the issuance of such Letter of Credit, ) exceeds the aggregate Revolving Credit Outstandings would exceed lesser of (A) the Maximum Credit at such time;
Commitment (iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior reductions to the Revolving Loan Maturity Date.
(cCommitment on such date) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit International Borrowing Base then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: International Revolving Loan Agreement (Natco Group Inc)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue issue one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of lawlaw but in relation with which such Issuer customarily complies) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section Sections 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, (A) the aggregate Revolving Credit Outstandings would exceed the Maximum Credit in effect at such timetime or (B) a Borrowing Base Deficiency would result with respect to the Borrower;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount sum of Letter of Credit Obligations then outstanding would exceed (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations at such time exceeds $5,000,000 (the “Letter of Credit Sublimit;”); or
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof; provided, or however, that (i) any Letter of Credit with a one-year term may provide for the renewal thereof for additional one-year periods and (ii) be less by not later than five days prior to the Revolving Loan Maturity DateCredit Termination Date the Borrower shall provide cash collateral in respect of any outstanding Letters of Credit issued for its account at such date in accordance with Section 9.3.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written noticenotice (a “Letter of Credit Request”), in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”)Credit. Such notice shall be irrevocable and shall (i) specify (A) the Borrower, the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. A.M. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuanceissuance and of the participation of each Lender in the Letter of Credit Obligations arising with respect thereto, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice by telephone, confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued issued by it, of all drawings under a Letter of Credit Issued issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail telecopy or similar transmission to each Lender);.
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 the first Business Days Day following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On Subject to the terms and subject conditions hereof and the satisfaction of the applicable conditions set forth in Article VI, at any time prior to the conditions contained in this Agreement, each Issuer agrees to Issue one Seller Obligations Final Due Date the LC Bank shall issue or more cause the issuance of Letters of Credit at the request on behalf of the Borrower Seller (and, if applicable, on behalf of, or for the account of, an Originator or an Affiliate of such Originator in favor of such beneficiaries as such Originator or an Affiliate of such Originator may elect with the consent of the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity DateSeller); provided, however, that no Issuer shall the LC Bank will not be under any obligation required to Issue issue, amend or extend (or cause to be issued, amended or extended) any Letter of Credit if:
(iA) any condition precedent specified in Section 6.02 is not satisfied with respect thereto;
(B) the LC Bank has received notice from any Purchaser Party or the Administrative Agent, at least one (1) day prior to the requested date of such LC Issuance, that one or more applicable conditions in Article VI is not satisfied; or
(C) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms purport to enjoin or restrain such Issuer the LC Bank from issuing such the Letter of Credit Credit, or any Requirement of Applicable Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer the LC Bank shall prohibit, or request that such Issuer the LC Bank refrain from, the issuance of letters of credit generally or such the Letter of Credit in particular or shall impose upon such Issuer the LC Bank with respect to such the Letter of Credit any restriction or restriction, reserve or capital requirement (for which such Issuer the LC Bank is not otherwise compensatedcompensated hereunder) not in effect on the date of this Agreement Closing Date, or result in shall impose upon the LC Bank any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of applicable on the date of this Agreement Closing Date and which such Issuer the LC Bank in good xxxxx fxxxx xxxxx material to it;
(iiD) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that LC Issuance would violate one or more policies of the LC Bank applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;to letters of credit generally; or
(iiiE) any Purchaser is at that time a Defaulting Purchaser, unless the LC Bank has entered into arrangements, including the delivery of cash collateral, satisfactory to the LC Bank (in its sole discretion) with the Seller or such Purchaser to eliminate the LC Bank’s actual or potential Fronting Exposure (after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(ivSection 2.10(a)(iv)) after giving effect with respect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed Defaulting Purchaser arising from either the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such then proposed to be issued or that Letter of Credit is not denominated and all other LC Participation Amounts as to which the LC Bank has actual or potential Fronting Exposure, as it may elect in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Creditits sole discretion.
(b) In no event Yield shall the expiration date of any Letter accrue on all amounts drawn under Letters of Credit (i) be more than one year for each day on and after the date of issuance thereof, or (ii) be less than five days prior applicable Drawing Date so long as such drawn amounts shall have not been reimbursed to the Revolving Loan Maturity DateLC Bank pursuant to the terms hereof.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received Each request by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business Seller for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer LC Issuance shall be deemed to have sold and transferred to each Lender, and each Lender be a representation by the Seller that it shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower compliance with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iiiSection 3.01(a)(i) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection and with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant Article VI after giving effect to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the IssuerLC Issuance.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Receivables Purchase Agreement (Exela Technologies, Inc.)
Letters of Credit. (a) On Subject to the terms and subject to conditions hereof and the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters of Credit at the request satisfaction of the Borrower for the account of the Borrower from applicable conditions set forth in Article VI, at any time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity DateA Commitment Terminations Date the LC Bank shall issue or cause the issuance of Letters of Credit on behalf of the Borrower (and, if applicable, on behalf of, or for the account of, an Originator or an Affiliate of such Originator in favor of such beneficiaries as such Originator or an Affiliate of such Originator may elect with the consent of the Borrower); provided, however, that no Issuer shall the LC Bank will not be under required to issue or cause to be issued any obligation to Issue any Letter Letters of Credit ifCredit:
(i) to the extent that after giving effect thereto:
(A) the Aggregate Loan Amount plus the Adjusted Revolving A LC Participation Amount would exceed the Borrowing Base at such time;
(B) the Total Revolving A Usage would exceed the aggregate of the Commitments of the Revolving A Lenders at such time; or
(C) the Revolving A LC Participation Amount would exceed the Revolving A LC Facility Sublimit; or
(ii) if the LC Bank has received notice from any Credit Party or the Administrative Agent, at least one (1) day prior to the requested date of issuance, amendment or extension of the applicable Letter of Credit, that one or more applicable conditions in Article VI is not satisfied; or
(iii) if any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms purport to enjoin or restrain such Issuer the LC Bank from issuing such the Letter of Credit Credit, or any Requirement of Applicable Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer the LC Bank shall prohibit, or request that such Issuer the LC Bank refrain from, the issuance of letters of credit generally or such the Letter of Credit in particular or shall impose upon such Issuer the Issuing Lender with respect to such the Letter of Credit any restriction or restriction, reserve or capital requirement (for which such Issuer the LC Bank is not otherwise compensatedcompensated hereunder) not in effect on the date of this Agreement Closing Date, or result in shall impose upon the LC Bank any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of applicable on the date of this Agreement Closing Date and which such Issuer the LC Bank in good xxxxx xxxxx material to it;; or
(iiiv) such Issuer shall have received written notice from if the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such the Letter of Credit, that Credit would violate one or more policies of the LC Bank applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;to letters of credit generally.
(iiib) Interest shall accrue on all amounts drawn under Letters of Credit for each day on and after the applicable Drawing Date so long as such drawn amounts shall have not been reimbursed to the LC Bank pursuant to the terms hereof.
(c) Each request by the Borrower for the issuance, amendment or extension of a Letter of Credit shall be deemed to be a representation by the Borrower that it shall be in compliance with the provisions of Section 3.01(a)(i) and with Article VI after giving effect to the issuance of such Letter of Creditrequested issuance, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars amendment or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance extension of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Loan and Security Agreement (Exela Technologies, Inc.)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters of Credit at the request of the any Borrower and for the account of the such Borrower one or more letters of credit or bank guarantees from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv)(A), (v) and (vi) below, shall not Issue) any Letter of Credit if:upon the occurrence of any of the following: AMENDED AND RESTATED CREDIT AGREEMENT SWIFT & COMPANY
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit or bank guarantees generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior after giving effect to the requested date of issuance Issuance of such Letter of Credit, that one or more (A) the aggregate Revolving Credit Outstandings of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfiedBorrowers would exceed the Aggregate Maximum Credit at such time or (B) the Revolving Credit Outstandings of the Borrower requesting such Letter of Credit would exceed the Maximum Available Borrowing Base of such Borrower at such time;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(vA) any fees due and payable in connection with a requested issuance Issuance have not been paid; or, (B) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, standard (but in any event commercially reasonable) documentation (collectively, a "Letter of Credit Reimbursement Agreement") such Issuer requires in the ordinary course of business (which may include, if requested by such Issuer, a letter of credit reimbursement agreement) to be completed or delivered by Letter of Credit applicants prior to issuing a Letter of Credit;
(v) such Letter of Credit is requested to be denominated in any Alternative Currency and the Applicable Lending Office of the Issuer receives written notice from the applicable Disbursement Agent at or before 11:00 a.m. (Local Time) on the date of the proposed Issuance of such Letter of Credit from such Applicable Lending Office that, immediately after giving effect to the Issuance of such Letter of Credit, all Letter of Credit Obligations at such time in respect of Letters of Credit denominated in any Alternative Currency would exceed $60,000,000;
(vi) such Letter of Credit is not requested to be denominated in any currency other than Dollars or in an Alternative Currency;
(vii) such Letter of Credit is a bank guarantee and (A) does not have a maximum face amount, (B) is requested by the Company, (C) is requested to be Issued by an Issuer that does not have an Australian Lending Office or is not requested to be issued from the Australian Lending Office of an Issuer or (D) is requested to be Issued by any Issuer that does not have the capacity to issue bank guarantees or has otherwise notified any Borrower on or prior to becoming an Issuer that it will not be able to Issue bank guarantees; or AMENDED AND RESTATED CREDIT AGREEMENT SWIFT & COMPANY
(viii) such Letter of Credit is a Government Bank Guarantee and the Issuer receives written notice from the Administrative Agent or the Australian Agent at or before 11:00 a.m. (Sydney Time) on the date of the proposed Issuance of such Government Bank Guarantee that, immediately after giving effect to the Issuance of such Government Bank Guarantee, all Letter of Credit Obligations at such time in respect of Government Bank Guarantees would exceed A$60,000,000. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (other than a Government Bank Guarantee) (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that (x) any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, on or before the expiration of such term and each such period, the Issuer of such Letter of Credit shall have the option to prevent such renewal and (y) no such term or period or renewal of either of them shall extend beyond the expiry date referred to in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower requesting such Letter of Credit shall give the relevant Issuer Disbursement Agent and the Administrative Agent Applicable Lending Office of the relevant Issuer at least two Business Days’ ' (or such shorter period as may be agreed by such IssuerLocal Time) prior written notice, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “"Letter of Credit Request”"). Such notice shall be irrevocable and shall specify (i) specify (A) the Issuer of such Letter of Credit, (ii) the stated currency of issuance and face amount of the Letter of Credit requestedrequested (the Dollar Equivalent of which shall not be less than $50,000 (unless otherwise agreed to by the Issuer)), which stated amount (or, if iii) whether such Letter of Credit is to be a bank guarantee or a letter of credit and, if a letter of credit denominated in Dollars or an Alternative Currency (other than U.S. Australian Dollars), the U.S. Dollar Equivalent of whether such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit is requested to be issued from the Domestic Lending Office, Eurodollar Lending Office or Australian Lending Office (which day shall be a Business Day)if any) of such Issuer, (Civ) the requested date of Issuance for such Letter of Credit, (v) the date on which such Letter of Credit is to expire (which date shall be a Business Day), ) and (Dvi) in the Person case of an issuance, the Persons for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the issued. Such Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such noticeRequest, to be effective, must be received by the relevant Issuer and the Administrative Disbursement Agent not later than 11:00 a.m. (New York City timeLocal Time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower requesting such Letter of Credit in accordance with such Issuer’s 's usual and customary business practices. In the case of an issuance of a Letter of Credit, if such Letter of Credit is requested by any Australian Borrower to be issued in Australian Dollars from an Australian Lending Office of such Issuer, such Letter of Credit shall be issued from such Australian Lending Office (if such Issuer has an Australian Lending Office) to the extent such Issuer is permitted to issue and maintain such Letter of Credit under applicable Requirements of Law. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any AMENDED AND RESTATED CREDIT AGREEMENT SWIFT & COMPANY Revolving Credit Lender that one or more of the conditions precedent contained in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) or clause (a) above (other than those conditions set forth in clauses (a)(i), (a)(iv) (provided, however, that clause (A) thereof shall be included in this exclusion only to the extent such clause relates to fees owing to the Issuer for such Letter of Credit and Affiliates thereof) and (a)(vii) (other than clause (A) thereof)) shall not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance Issuance or renewal of a any Letter of Credit Issued issued by it, of all drawings under a any Letter of Credit Issued issued by it and of the payment (or the failure to pay when due) by the any Borrower of any Reimbursement Obligation of such Borrower when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Revolving Credit Lender);
(ii) upon the request of any Revolving Credit Lender, furnish to such Revolving Credit Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Revolving Credit Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Revolving Credit Lender requesting the same) and the Borrower Company separate schedules for Documentary Letters of Credit and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations of each Borrower, in each case outstanding at the end of each month month, and any information reasonably requested by the Borrower Company or the Administrative Agent relating thereto.
(gf) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Revolving Credit Lender, and each Revolving Credit Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Revolving Credit Lender’s 's Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations with respect thereto of the Borrower with respect thereto for whose account such Letter of Credit was Issued (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(hg) The Borrower at whose request any such Letter of Credit has been issued agrees to pay in immediately available funds in the currency applicable to such Reimbursement Obligation to the Issuer of a such Letter of Credit the amount of all Reimbursement Obligations of such Borrower owing to such Issuer under a such Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from no later than the date on which such Reimbursement Obligation arose to that is the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such next succeeding Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not after the conditions precedent set forth in Section 3.2 Company AMENDED AND RESTATED CREDIT AGREEMENT SWIFT & COMPANY
(a) (The Commitments) shall have been satisfied (which conditions precedent the Revolving Credit Lenders hereby irrevocably waive) ), be deemed to have made a Revolving Loan to the Borrower for whose account such Letter of Credit was issued in the principal amount of such payment. Whenever any Issuer receives from the any Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a any Revolving Credit Lender pursuant to this clause (hg), such Issuer shall pay over to the Administrative Agent any amount received in excess of such Reimbursement Obligation and the Administrative Agent shall promptly pay over to each such Revolving Credit Lender, in immediately available funds, an amount equal to such Revolving Credit Lender’s 's Ratable Portion of any amount received by the Administrative Agent to the extent such amount would be, if received by such Issuer, in excess of such payment Reimbursement Obligation, such amount to be adjusted, if necessary, to reflect the respective amounts the Revolving Credit Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Credit Agreement (S&c Holdco 3 Inc)
Letters of Credit. (a) On the Effective Date (x) all Letters of Credit under the Existing Credit Agreement shall be deemed to be Letters of Credit outstanding under this Agreement and (y) on the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement Effective Date or result in any unreimbursed loss, cost or expense which that was not applicable, Amended and Restated Credit Agreement U.S. Concrete, Inc. in effect or known to such Issuer as of the date of this Agreement Effective Date and which that such Issuer in good xxxxx fxxxx xxxxx material to itit (for which such Issuer is not otherwise compensated);
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any fees due and payable in connection with a requested issuance have not been paidcurrency other than Dollars; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated reasonably acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Revolving Credit Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five 5 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (x) on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) neither the Issuer nor the Borrower shall permit any such renewal to extend the expiration date of any Letter beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two 2 Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.. Amended and Restated Credit Agreement U.S. Concrete, Inc.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Revolving Credit Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Credit Agreement (Us Concrete Inc)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Performance Letters of Credit at the request of the Borrower of, and for the account of, an Applicant to support obligations of the Borrower Parent, such Applicant, any of the Parent’s Subsidiaries or any of the Parent’s or any of its Subsidiaries’ Joint Ventures, from time to time on any Business Day during the period commencing on the Closing Initial Utilization Date and ending on the earlier of the Revolving Credit Termination Date and date that is 30 days prior to before the Revolving Loan Maturity Date; provided, however, provided that no Issuer shall be under any obligation to Issue any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer (including, without limitation, any applicable “know your customer” and anti-money laundering rules and regulations) or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender Participant or the Borroweran Applicant, on or prior to the requested date of issuance Issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 (with respect to an Issuance on the Initial Utilization Date) or 3.3 is not then satisfiedsatisfied or duly waived in accordance with Section 11.1, and such notice has not been revoked by the Person that delivered such notice;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, (x) the aggregate Revolving Letter of Credit Outstandings Obligations would exceed the Maximum Credit Commitments in effect at such timetime or (y) the aggregate outstanding amount of all Letters of Credit issued by such Issuer would exceed its Issuer Commitment;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit[reserved];
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is requested to be issued in a form that is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (sole discretion exercised in a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender)commercially reasonable manner;
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such any requested Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency Currency, the relevant Issuer or the Administrative Agent shall not have approved such Issuance;
(other than U.S. Dollarsvii) such Letter of Credit does not comply with such Issuer’s internal policies with respect thereto; or
(viii) such Letter of Credit is a trade or commercial letter of credit or bank guarantee. No Issuer shall be measured by a determination by required to Issue any Letter of Credit if any fees due to the applicable Issuer in connection with a requested Issuance have not been paid. For the avoidance of the U.S. Dollar Equivalent of such Letters doubt, no Issuer shall be required to Issue any Letter of Credit on each day on which other than a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower Performance Letter of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by itCredit.
Appears in 1 contract
Samples: Letter of Credit Agreement (McDermott International Inc)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue issue one or more Letters of Credit denominated in Dollars at the request of the a Borrower for the account of the such Borrower from time to time during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx fxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the any Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and (Conditions Precedent to the Effectiveness of this Agreement) or Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount sum of Letter of Credit Obligations then outstanding would exceed (i) the Letter of Credit Sublimit;Undrawn Amounts at such time and (ii) the Reimbursement Obligations at such time would exceed $5,000,000; or
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five thirty days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a one-year term may provide for the renewal thereof for additional one-year periods (which shall in no event extend beyond the expiry date referred to in clause (ii) above).
(c) In connection with the issuance of each Letter of CreditCredit for the account of any Borrower, the such Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer)$50,000, (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. A.M. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue issue a Letter of Credit on behalf of the applicable Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit for the account of any Borrower by such Issuer, and as a condition of such issuanceissuance and of the participation of each Lender in the Letter of Credit Obligations arising with respect thereto, the such Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the such Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance or renewal of a Letter of Credit Issued issued by itit for the account of any Borrower, of all drawings under a Letter of Credit Issued issued by it and the payment (or the failure to pay when due) by the such Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
; (ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Credit Agreement (Suntron Corp)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer the Lender agrees to Issue assist the Borrower in establishing or opening one or more Letters of Credit with an Issuer at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer the Lender shall not be under any obligation to Issue assist in the Issuance of any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such the Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such the Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such the Issuer shall prohibit, or request that such the Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such the Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such the Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such the Issuer as of the date of this Agreement and which such that the Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such timetime exceeds the Revolving Credit Commitment;
(iviii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(viv) any fees due and payable in connection with a requested issuance Issuance have not been paid;
(v) such Letter of Credit is requested to be Issued in a form that is not acceptable to the Issuer or the Lender; or
(vi) such Letter of Credit is not requested to be denominated in Dollars or in an Alternative Currency. None of the Lenders (any currency other than the Issuers in their capacity as such) Dollars. The Lender shall not have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five seven days prior to the Revolving Loan Maturity Scheduled Termination Date.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent Lender at least two five Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the IssuerLender), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an Issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent Lender not later than 11:00 a.m. (New York City California time) on the second (2nd) fifth Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit Lender the amount of all Reimbursement Obligations owing to such Issuer under a the Lender in respect of any Letter of Credit when no later than the date that is the next succeeding Business Day after the Borrower receives written notice from the Lender that payment has been made under such amounts are due and payableLetter of Credit (the “Reimbursement Date”), irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer the Lender or any other Person. In the event that any Issuer the Lender makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer the Lender pursuant to this clause (hd) or any such payment by the Borrower is rescinded or set aside for any reason, such Reimbursement Obligation shall bear be payable on demand with interest thereon computed (i) from the date on which such Reimbursement Obligation arose to the date of repayment in full Reimbursement Date, at the rate of interest applicable during such period to Revolving Loans bearing and (ii) from the Reimbursement Date until the date of repayment in full, at the rate of interest at a rate based on the Prime Rate applicable during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure period to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a past due Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement ObligationLoans.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(je) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective ofof any of the following:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set set-off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent Lender or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this SectionSection 2.3, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer Lender under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer the Lender under any resulting liability to the Borrower or any LenderBorrower. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Lender and the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Lender and the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, order and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Lender or the Issuer, as the case may be.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Revolving Credit Agreement (Hughes Electronics Corp)
Letters of Credit. (a) (x) On the Effective Date all “Letters of Credit” issued under and as defined in the Existing Credit Agreement shall be deemed to be Letters of Credit issued and outstanding under this Agreement and (y) on the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower Agent and for the account of the Borrowers or any of the Borrowers’ Subsidiaries one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity DateScheduled Termination Date (or such later date as agreed to by the Administrative Agent); provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv) and (v)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator having binding powers shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement Effective Date or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement Effective Date and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of CreditCredit is requested to be denominated in any currency other than Dollars, except as may be approved by the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;Administrative Agent and such Issuer, each in their sole discretion; or
(v) (A) any fees due and payable in connection with a requested issuance Issuance have not been paid; or
, (viB) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit. Any Letter of Credit which has been or deemed Issued hereunder may be amended at any time to reduce the amount outstanding thereunder.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof; provided, or (ii) be however, that any Letter of Credit with a term less than five days or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, on or before the expiration of each such term and each such period, the Borrowers and the Issuer of such Letter of Credit shall have the option to prevent such renewal; and provided, further, that, for any Letter of Credit having an expiration date after the Scheduled Termination Date, the Borrowers agree to deliver to the Administrative Agent on or prior to the Revolving Loan Maturity DateScheduled Termination Date a letter of credit or letters of credit in form and substance acceptable to the Administrative Agent and issued by a bank acceptable to the Administrative Agent, in each case in its sole discretion, and/or cash collateral in an amount equal to 101% of the maximum drawable amount of any such Letter of Credit.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower Agent shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the such Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) last Business Day on which such notice can be given under the first sentence of this clause (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Creditc).
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower Borrowers in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Credit Agreement (J Crew Group Inc)
Letters of Credit. (a) On Subject to and upon the terms and subject conditions herein set forth, the Borrower may request the Letter of Credit Issuer at any time and from time to time on or after the Initial Borrowing Date and prior to the conditions contained in this AgreementBusiness Day preceding the Final Maturity Date to issue, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time and in support of, on a standby basis only, L/C Supportable Indebtedness of any Credit Party or any Subsidiary of any Credit Party to time during any other Person, irrevocable standby letters of credit in such form as may be approved by such Letter of Credit Issuer (each such letter of credit, a "Letter of Credit" and, collectively, the period commencing on "Letters of Credit"). Notwithstanding the Closing Date and ending on the earlier foregoing, no Letter of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue issue any Letter of Credit ifif at the time of such issuance:
18 (i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport by its terms to enjoin or restrain such Letter of Credit Issuer from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Letter of Credit Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such Letter of Credit Issuer shall prohibit, or request that such Letter of Credit Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Letter of Credit Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Letter of Credit Issuer is not otherwise compensatedcompensated pursuant to the terms hereof) not in effect on the date of this Agreement hereof, or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Letter of Credit Issuer as of the date of this Agreement hereof and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is Issuer in good faitx xxxxx xxxerial to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Loan Agreement (Grey Wolf Inc)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity DateDate (excluding the DIP Termination Date if the Administrative Agent reasonably determines that the Conversion Date will occur); provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv) and (v)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfied;clause (d) below; CREDIT AGREEMENT CONSTAR INTERNATIONAL INC.
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;; or
(v) (A) any fees due and payable in connection with a requested issuance Issuance have not been paid; or
, (viB) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by the Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall (i) any Letter of Credit be issued within 30 days of the Maturity Date or (ii) the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof; provided, or (ii) be however, that any Letter of Credit with a term less than five days or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal; and provided, further, that, for any Letter of Credit having an expiration date after the Maturity Date, the Borrower agrees to deliver to the Administrative Agent on or prior to the Revolving Loan Maturity DateDate a letter of credit or letters of credit in form and substance acceptable to the Administrative Agent and issued by a bank acceptable to the Administrative Agent, in each case in its sole discretion, and/or cash collateral in an amount equal to 105% of the maximum drawable amount of any such Letter of Credit.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Revolving Credit Lender that one or more of the conditions CREDIT AGREEMENT CONSTAR INTERNATIONAL INC. precedent contained in Section 3.2 shall (Conditions Precedent to Each Loan and Letter of Credit) or clause (a) above (other than those conditions set forth in clauses (a)(i), (a)(v)(B) and (C) above and, to the extent such clause relates to fees owing to the Issuer of such Letter of Credit and its Affiliates, clause (a)(v) (A) above) are not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If The Borrower agrees that, if requested by the relevant Issuer, prior to the issuance Issuer of each any Letter of Credit by such IssuerCredit, and as it shall execute a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant Agreement in respect to the terms thereofany Letter of Credit Issued hereunder. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance or renewal Issuance of a any Letter of Credit Issued by it, of all drawings under a any Letter of Credit Issued by it and of the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Revolving Credit Lender, furnish to such Revolving Credit Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Revolving Credit Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary Letters of Credit and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations Obligations, in each case outstanding at the end of each month month, and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Revolving Credit Lender, and each Revolving Credit Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Revolving Credit Lender’s Ratable Portion of the Revolving Credit CommitmentsPortion, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue issue one or more Letters of Credit at the request of the Borrower Borrowers for the account of the Borrower Borrowers from time to time during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 five (5) days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good faitx xxxxx xxxxx material xxxerial to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Revolving Credit Lender or the BorrowerBorrowers, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section Sections 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum aggregate of the Revolving Credit Commitments in effect at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimitat such time exceeds $30,000,000;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) if such Letter of Credit is not denominated in Dollars or in an Alternative Currencya currency other than Dollars. None of the Revolving Credit Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five (5) days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a one-year term may provide for the renewal thereof for additional one-year periods (which shall in no event extend beyond the expiry date referred to in clause (ii) above).
(c) In connection with the issuance of each Letter of Credit, the Borrower Borrowers shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) ' prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “"Letter of Credit Request”"). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars)Alternate Currency, the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer)$500,000, (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue issue a Letter of Credit on behalf of the Borrower Borrowers in accordance with such Issuer’s 's usual and customary business practices. No Issuer shall Issue issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuanceissuance and of the participation of each Revolving Credit Lender in the Letter of Credit Obligations arising with respect thereto, the applicable Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “"Letter of Credit Reimbursement Agreement”"), signed by the such Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued issued by it, of all drawings under a Letter of Credit Issued issued by it and the payment (or the failure to pay when due) by the applicable Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail telecopy or similar transmission to each Revolving Credit Lender);
(ii) upon the request of any Revolving Credit Lender, furnish to such Revolving Credit Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Revolving Credit Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Revolving Credit Lender requesting the same) and the Borrower Borrowers separate schedules for Documentary documentary and Standby Letters standby letters of Credit Issued credit issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower Borrowers or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each LenderRevolving Credit Lender (or to each Canadian Lender in the case of Letters of Credit issued for the account of the Canadian Borrower), and each such Revolving Credit Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Revolving Credit Lender’s 's Ratable Portion (or Canadian Ratable Portion, in the case of Letters of Credit issued for the account of the Canadian Borrower) of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower Borrowers with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Each Borrower agrees to pay to the Issuer of a any Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a any Letter of Credit issued for its account when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the which such Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower for whose account such Letter of Credit was issued shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear be payable on demand with interest thereon computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to past due Revolving Loans bearing interest at a rate based on the Prime Base Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Revolving Credit Lender (or each Canadian Lender in the case of Letters of Credit issued for the account of the failure to repay Canadian Borrower) of such Reimbursement Obligationfailure, and each Revolving Credit Lender (or Canadian Lender) shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Revolving Credit Lender’s 's Ratable Portion (or such Canadian Lender's Canadian Ratable Portion) of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) applicable Currency and in immediately available funds. If the Administrative Agent so notifies such Revolving Credit Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Revolving Credit Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion or Canadian Ratable Portion, as applicable, of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Revolving Credit Lender, such Revolving Credit Lender shall shall, except during the continuance of a Default or Event of Default under Section 7.1(h) and notwithstanding whether or not the conditions precedent set forth in Section 3.2 or 3.3, as applicable, shall have been satisfied (which conditions precedent the Revolving Credit Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the applicable Borrower in the principal amount of such payment. Whenever any Issuer receives from the a Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Revolving Credit Lender pursuant to this clause (h)) above, such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Revolving Credit Lender or Canadian Lender, as applicable, in immediately available funds, an amount equal to such Revolving Credit Lender’s 's Ratable Portion (or such Canadian Lender's Canadian Ratable Portion) of the amount of such payment adjusted, if necessary, to reflect the respective amounts the such Revolving Credit Lenders (or Canadian Lenders) have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s Borrowers' obligation to pay each Reimbursement Obligation with respect to Letters of Credit and the obligations of the Revolving Credit Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the BorrowerBorrowers, any other party guaranteeing, or otherwise obligated with, the BorrowerBorrowers, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s Borrowers' obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower Borrowers or any Revolving Credit Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(kj) If and to the extent such Revolving Credit Lender shall not have so made its Ratable Portion or Canadian Ratable Portion, as applicable, of the amount of the payment required by clause (i) above available to the Administrative Agent for the account of such Issuer, such Revolving Credit Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand such amount together with interest thereon, for the first Business Day after payment was first due at the Interbank Rate, and thereafter until such amount is repaid to the Administrative Agent for the account of such Issuer, at the rate per annum applicable to Base Rate Loans. The failure of any Revolving Credit Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion or Canadian Ratable Portion in the case of Letters of Credit may be Issued in favor an Alternate Currency of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to any such Letter of Credit is the Borrower.
(l) The amount of payment shall not relieve any other Revolving Credit Commitments utilized by Letters Lender of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify its obligation hereunder to make available to the Administrative Agent and for the Borrower account of such Issuer its Ratable Portion or Canadian Ratable Portion, as applicable, of any payment on the date such payment is to be made, but no Revolving Credit Lender shall be responsible for the failure of any other Revolving Credit Lender to make available to the Administrative Agent for the account of the aggregate U.S. Dollar Equivalent Issuer such other Revolving Credit Lender's Ratable Portion or Canadian Ratable Portion, as applicable, of any such utilization in respect of the Letters of Credit Issued by itpayment.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Company and for the account of the Company (or for the joint and several account of the Company and a Subsidiary of the Company) one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Amendment No. 3 Effective Date and ending on the earlier of the Revolving Credit Termination Date and (x) 30 days prior to the Scheduled Revolving Loan Maturity Termination Date, in the case of a Documentary Letter of Credit and (y) 5 days prior to the Scheduled Revolving Termination Date, in the case of a Standby Letter of Credit; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v), and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement Closing Date or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement Closing Date and which that such Issuer in good xxxxx xxxxx material to itsuch Issuer;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum aggregate Revolving Credit Commitments in effect at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of Letter (i) the Dollar Equivalents of Credit Obligations then outstanding would exceed the Letter of Credit Undrawn Amounts at such time and (ii) the Dollar Equivalents of the Reimbursement Obligations at such time exceeds the Letter of Credit Sublimit; provided, however, that no Issuer shall be required to Issue in its own name, Letters of Credit, denominated in Dollars or an Alternative Currency, for the account of the Company, in excess of its Issuer Sublimit;
(v) (A) such Letter of Credit is requested to be denominated in any fees due Alternative Currency and payable the Issuer receives written notice from the Administrative Agent at or before 11:00 a.m. (New York time) on the date of the proposed Issuance of such Letter of Credit that, immediately after giving effect to the Issuance of such Letter of Credit, all Letter of Credit Obligations at such time in connection with a respect of each Letter of Credit denominated in currencies other than Dollars would exceed $5,000,000 or (B) such Letter of Credit is requested issuance have not been paidto be denominated in any currency other than Dollars or an Alternative Currency; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by the Company, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Revolving Credit Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Scheduled Revolving Loan Maturity Termination Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (x) on or before the expiration of each such term and each such period, the Company and the Issuer of such Letter of Credit shall have the option to prevent such renewal and (y) neither the Issuer of such Letter of Credit nor the Company shall permit any such renewal to extend the expiration date of any Letter of Credit beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower Company shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount requested (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. whose Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 $500,000 (or such lesser amount as may be mutually agreed to by such between the Company and the relevant Issuer)), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. 1:00 p.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower Company in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Revolving Credit Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of each Borrower and for the account of such Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Scheduled Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx fxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum aggregate Revolving Credit Commitments at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount of Letter of applicable Borrower’s Revolving Credit Obligations then outstanding Outstandings would exceed the Letter of its Revolving Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any currency other than Dollars;
(A) any fees due and payable in connection with a requested issuance Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in form and substance reasonably acceptable to it and, if applicable, duly executed by the applicable Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit; or
(vivii) such Letter of Credit is not denominated in Dollars or in an Alternative Currencya Standby Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Revolving Loan Scheduled Maturity Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as (x) on or before the expiration of each such term and each such period, the applicable Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) neither the Issuer of such Letter of Credit nor the applicable Borrower shall permit any such renewal to extend the expiration date of any Letter of Credit beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the applicable Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D H (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall specify (i) specify (A) the Issuer of such Letter of Credit, (ii) the stated face amount of the Letter of Credit requested, requested (which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer$1,000,000), (Biii) the date of issuance Issuance of such requested Letter of Credit (which day date shall be a Business Day), (Civ) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (Dv) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.42.3, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the applicable Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall 4.2 (Conditions Precedent to Each Extension of Credit) or clause (a) above (other than those conditions set forth in clauses (a)(i), (a)(vi)(B) and (C) above and, to the extent such clause relates to fees owing to the Issuer of such Letter of Credit and its Affiliates, clause (a)(vi)(A) above) are not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 4.2 (Conditions Precedent to Each Extension of Credit) have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If Each Borrower agrees that, if requested by the relevant Issuer, prior to the issuance Issuer of each any Letter of Credit by such IssuerCredit, and as it shall execute a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant Agreement in respect to the terms thereofany Letter of Credit Issued hereunder. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement or to the extent any Letter of Credit Reimbursement Agreement purports to add defaults or events of default or provide for the grant of security not contemplated by this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy, of the issuance or renewal Issuance of a any Letter of Credit Issued by it, of all drawings under a any Letter of Credit Issued by it and of the payment (or the failure to pay when due) by the applicable Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Parent Borrower separate schedules for Documentary and Standby a schedule of Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations Obligations, in each case outstanding at the end of each month month, and any information requested by the Parent Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit CommitmentsPortion, in such Letter of Credit and the obligations of the applicable Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Each Borrower agrees to pay to the Issuer of a any Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a any Letter of Credit when issued for its account no later than the date that is the next succeeding Business Day after such amounts are due and payableBorrower receives written notice from such Issuer that payment has been made under such Letter of Credit (the “Reimbursement Date”), irrespective of any claim, set-off, defense or other right that the such Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the applicable Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or any such payment by such Borrower is rescinded or set aside for any reason, such Reimbursement Obligation shall bear be payable on demand with interest thereon computed (i) from the date on which such Reimbursement Obligation arose to the date of repayment in full Reimbursement Date, at the rate of interest applicable during such period to Revolving Loans bearing that are Base Rate Loans and (ii) from the Reimbursement Date until the date of repayment in full, at the rate of interest at a rate based on the Prime Rate applicable during such periodperiod to past due Revolving Loans that are Base Rate Loans, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligationfailure, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available fundsDollars. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall shall, except during the continuance of a Default or Event of Default under Section 8.1(f) (Events of Default) and notwithstanding whether or not the conditions precedent set forth in Section 3.2 4.2 (Conditions Precedent to Each Extension of Credit) shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) ), be deemed to have made a Revolving Loan to the applicable Borrower in the principal amount of such payment. Whenever any Issuer receives from the applicable Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay over to the Administrative Agent and any amount received in respect of such Reimbursement Obligation and, upon receipt of such amount, the Administrative Agent shall promptly pay over to each Lender, in immediately available funds, an amount equal to such Revolving Credit Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Revolving Credit Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Federal Funds Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Base Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Each Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, irrevocable and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective ofof any of the following:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the such Borrower, any other Loan Party, any other party guaranteeing, or otherwise obligated with, the such Borrower, any Subsidiary of a Loan Party or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the any Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this SectionSection 2.3, constitute a legal or equitable discharge of the such Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put result in any liability of such Issuer under to any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) Credit, the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever whatsoever, and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Revolving Credit Agreement (Boardwalk Pipeline Partners, LP)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Company and for the account of the Company (or for the joint account of the Company and any of its Subsidiaries) one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (v) and to the extent relating to any fees owing to the Issuer of such Letter of Credit or its Affiliates, clause (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit LC Obligation Outstandings would exceed the Maximum Credit LC Commitments of all LC Participants at such timetime or unless otherwise agreed to by such Issuer in its sole discretion, if the aggregate LC Obligation Outstandings in respect of Letters of Credit issued by such Issuer would exceed such Issuer’s Issuer Sublimit;
(iv) after giving effect to in the issuance case of Barclays or Royal Bank of Canada, if such Letter of Credit, the aggregate amount of Credit is a Documentary Letter of Credit Obligations then outstanding would exceed the Letter of Credit SublimitCredit;
(v) such Letter of Credit is requested to be denominated in any fees due and payable in connection with a requested issuance have not been paidcurrency other than Dollars; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by the Company, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders LC Participants (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit. Additionally, notwithstanding the foregoing, in no event shall Bank of America, N.A. or Citibank, N.A., in their respective capacities as Issuers, be required to issue any Letter of Credit (other than the deemed issuance of the Existing Letters of Credit hereunder on the Effective Date) or to extend the expiration date or increase the stated amount of any Existing Letter of Credit, nor shall the Company request such issuance, extension or increase.
(b) In no event shall the expiration date of any Letter of Credit be (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than after the date that is five days Business Days prior to the Revolving Loan Maturity Termination Date, unless consented to by the applicable Issuer in such Issuer’s sole discretion; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the automatic renewal thereof for additional periods less than or equal to one year, as long as, on or before the expiration of each such term and each such period, each of the Company and the Issuer of such Letter of Credit shall have the option to prevent such automatic renewal.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower Company shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D B (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer, including, but not limited to, the executed Letter of Credit Reimbursement Agreement of such Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) and in the case of Royal Bank of Canada not later than 9:30 a.m. (New York City time), on the second (2nd) third Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower Company in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender LC Participant that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Letter of Credit Facility Agreement (Tenet Healthcare Corp)
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense (for which such Issuer is not otherwise compensated) that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance Issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 3.2 (Conditions Precedent to Each Loan and Letter of Credit) and Section 3.2 2.4 (Letters of Credit) is not then satisfied;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would at such time exceed the Letter of Credit Sublimit$80,000,000;
(v) any fees due and payable in connection with a requested issuance Issuance have not been paid; or
(vi) such Letter of Credit is requested to be Issued in a form that is not denominated in Dollars or in an Alternative Currencyacceptable to such Issuer. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance Issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a one-year term may provide for the renewal thereof for additional one-year periods (which shall in no event extend beyond the expiry date referred to in clause (ii) above).
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) ' prior written notice, in substantially the form of Exhibit D E (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “"Letter of Credit Request”"). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer)$10,000, (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectIssued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.42.4 (Letters of Credit), the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower and, if applicable, one of its Subsidiaries in accordance with such Issuer’s 's usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from any Lender or the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance Issuance of each Letter of Credit by such Issuer, and as a condition of such issuanceIssuance and of the participation of each Lender in the Letter of Credit Obligations arising with respect thereto, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “"Letter of Credit Reimbursement Agreement”"), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which writing may be by telecopier) of the issuance or renewal Issuance of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and it, the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail telecopy or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance Issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s 's Ratable Portion of the Revolving Credit CommitmentsPortion, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a any Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a any Letter of Credit when Issued for its account no later than the date that is the next succeeding Business Day after the Borrower receives written notice from such amounts are due and payableIssuer that payment has been made under such Letter of Credit (the "Reimbursement Date"), irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) on or before 11:00 a.m. (New York City time) on the next Business Day following the Borrower's receipt of the aforesaid notice, then (i) the relevant Issuer shall notify the Administrative Agent of such payment is rescinded or set aside for any reasonfailure to repay, (ii) such Reimbursement Obligation shall bear be payable on demand with interest thereon computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to past due Revolving Loans bearing interest at a rate based on the Prime Base Rate during such period, and such Issuer (iii) the Borrower shall promptly notify be deemed to have elected (if a formal notice of Borrowing has not been received by the Administrative Agent, which shall promptly notify each Lender Agent in respect of the failure to repay such Reimbursement Obligation, ) to have the Reimbursement Obligation satisfied by the Borrowing of a Base Rate Loan in an amount equal to such Reimbursement Obligation and (iv) each Lender shall, except during the continuance of a Default or Event of Default under Section 9.1(f) (Events of Default) and notwithstanding whether or not the conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) shall promptly have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) provided that such Issuer has not received the notice referred to in the penultimate sentence of clause (d) above (and unconditionally the condition referred to in such notice has not been waived in accordance with this Agreement), pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s 's Ratable Portion of such payment Reimbursement Obligations and be deemed to have made a Revolving Loan to the Borrower in Dollars (orthe principal amount of such payment. Prior to the funding of such Revolving Loan, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s 's Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s 's obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the any Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the any Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this SectionSection 2.4 (Letters of Credit), constitute a legal or equitable discharge of the Borrower’s 's obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) Credit, the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(kj) Letters If and to the extent such Lender shall not have so made its Ratable Portion of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized the payment required by Letters of Credit denominated in an Alternative Currency clause (other than U.S. Dollarsh) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Federal Funds Rate, and thereafter until such amount is repaid to the Borrower Administrative Agent for the account of such Issuer, at the rate per annum applicable to Base Rate Loans under the Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the aggregate U.S. Dollar Equivalent Issuer such other Lender's Ratable Portion of any such utilization in respect of the Letters of Credit Issued by itpayment.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Initial Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx faith deems material to it;
(iixx) such xxxx Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(viv) such Letter of Credit is not requested to be denominated in Dollars any currency other than Dollars; or
(A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not reasonably acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in an Alternative Currencyform and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a "Letter of Credit Reimbursement Agreement") such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Revolving Credit Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) unless cash collateralized in the manner set forth in Section 9.3 in an amount equal to 105% of the Letter of Credit Obligations for such Letter of Credit on the date of Issuance thereof and at all times thereafter while such Letter of Credit is outstanding, be less than five seven days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (x) on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) the Borrower shall not permit any such renewal to extend the expiration date of any Letter beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) ' prior written notice, in substantially the form of Exhibit D E (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “"Letter of Credit Request”"). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount of the Letter of Credit requested, which stated face amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer)$100,000, (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) and, in the case of an Issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s 's usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Revolving Credit Lender that one or more of the conditions precedent contained in Section 3.2 shall (Conditions Precedent to Each Loan and Letter of Credit) or clause (a) above (other than those conditions set forth in clauses (a)(i), (a)(vi)(B) and (C) above and, to the extent such clause relates to fees owing to the Issuer of such Letter of Credit and its Affiliates, clause (a)(vi)(A) above) are not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If The Borrower agrees that, if requested by the relevant Issuer, prior to the issuance Issuer of each any Letter of Credit by such IssuerCredit, and as it shall execute a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereofAgreement in respect of any Letter of Credit Issued hereunder. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance or renewal Issuance of a any Letter of Credit Issued by it, of all drawings under a any Letter of Credit Issued by it and of the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Revolving Credit Lender);
(ii) upon the request of any Revolving Credit Lender, furnish to such Revolving Credit Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Revolving Credit Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Revolving Credit Lender requesting the same) and the Borrower separate schedules for Documentary Letters of Credit and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations Obligations, in each case outstanding at the end of each month month, and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance Issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Revolving Credit Lender, and each Revolving Credit Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Revolving Credit Lender’s 's Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a any Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a any Letter of Credit when issued for its account no later than the date that is the next succeeding Business Day after the Borrower receives written notice from such amounts are due and payableIssuer that payment has been made under such Letter of Credit (the "Reimbursement Date"), irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or any such payment by the Borrower is rescinded or set aside for any reason, such Reimbursement Obligation shall bear be payable on demand with interest thereon computed (i) from the date on which such Reimbursement Obligation arose to the date of repayment in full Reimbursement Date, at the rate of interest applicable during such period to Revolving Loans bearing that are Base Rate Loans and (ii) from the Reimbursement Date until the date of repayment in full, at the rate of interest at a rate based on the Prime Rate applicable during such periodperiod to past due Revolving Loans that are Base Rate Loans, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Revolving Credit Lender of the failure to repay such Reimbursement Obligationfailure, and each Revolving Credit Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Revolving Credit Lender’s 's Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Revolving Credit Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Revolving Credit Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Revolving Credit Lender, such Revolving Credit Lender shall shall, notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Revolving Credit Lenders hereby irrevocably waive) ), be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Revolving Credit Lender pursuant to this clause (h), such Issuer shall pay over to the Administrative Agent and any amount received in excess of such Reimbursement Obligation and, upon receipt of such amount, the Administrative Agent shall promptly pay over to each Revolving Credit Lender, in immediately available funds, an amount equal to such Revolving Credit Lender’s 's Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Revolving Credit Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Revolving Credit Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Revolving Credit Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Federal Funds Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Base Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s 's obligation to pay each Reimbursement Obligation and the obligations of the Revolving Credit Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective ofof any of the following:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the any Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this SectionSection 2.4, constitute a legal or equitable discharge of the Borrower’s 's obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put result in any liability of such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) Credit, the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Secured Debtor in Possession Credit Agreement (Friedmans Inc)
Letters of Credit. (a) On Subject to the terms and subject to the conditions contained in this Agreementset forth herein, each Issuer agrees to Issue and amend (including, without limitation, to increase or decrease the stated amount of each Letter of Credit) at the request and for the account of Xxxxxxxx, or (so long as the Borrower is solely liable hereunder with respect to any Reimbursement Obligations relating to any such Letter of Credit, which liability may, at the request of the Borrower, be evidenced by a Letter of Credit Reimbursement Agreement as described in Section 2.4(e) below) any of the Borrower’s Restricted Subsidiaries or any Related Corporation one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 5 days prior to the Revolving Loan Maturity Scheduled Termination Date; providedprovided that in the event of any inconsistency between the terms and conditions of this Agreement and the other terms and conditions of any Letter of Credit Request submitted by Borrower or any Letter of Credit, howeverthe terms and conditions of this Agreement shall control. Notwithstanding the foregoing, that no Issuer shall be under any obligation to, and with respect to clause (iv) below no Issuer shall, Issue any Letter of Credit if:
upon the occurrence of any of the following: (iA) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.any
Appears in 1 contract
Letters of Credit. (a) On the terms and Letters of credit as authorized by W.S. § 00-00-000, shall be subject to the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit iffollowing conditions:
(i) any order, judgment The letter must be payable to the Department in part or decree in full upon demand and receipt from the Director of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter a notice of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority forfeiture issued in accordance with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to itW.S.§ 35- 11-421;
(ii) such Issuer The letter shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date not be in excess of issuance of such Letter of Credit, that one or more ten percent of the applicable conditions contained in Section 3.1 issuing or supporting bank(s) capital surplus account as shown on the on- and Section 3.2 is not then satisfiedoff-balance sheet liabilities certified by a certified public accountant;
(iii) after giving effect to The Administrator shall not accept standby letters of credit or letters of credit from a bank for any person, on all permits held by that person, in excess of three times the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;limitation imposed by W.S. § 13-3-402; and
(iv) after giving effect The letter of credit shall provide that:
(A) The bank will give prompt notice to the issuance permittee and the Director of such Letter any notice received or action filed alleging the insolvency or bankruptcy of Creditthe bank, or alleging any violations of regulatory requirements which could result in suspension or revocation of the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimitbank's charter or license to do business;
(vB) In the event the bank becomes unable to fulfill its obligations under the letter of credit for any fees due reason, notice shall be given immediately to the permittee and payable in connection with a requested issuance have not been paidthe Director; orand
(viC) such Letter Upon the incapacity of Credit a bank by reason of bankruptcy, Chapter 12, Section 1(a)(v)insolvency, or suspension or revocation of its charter or license, the permittee shall be deemed to be without performance bond coverage in violation of the Act. The Director shall issue a notice of violation against any operator who is without bond coverage, specifying a reasonable period to replace bond coverage, not to exceed 90 days. During this period the Director or his designated representative shall conduct weekly inspections to ensure continuing compliance with other permit requirements, the regulations and the Act. If the notice is not denominated abated in Dollars or in an Alternative Currency. None of accordance with the Lenders (other than the Issuers in their capacity as such) schedule, a cessation order shall have any obligation to Issue any Letter of Creditbe issued.
(b) In no event shall The letter may only be issued by a bank organized to do business in the expiration date of U.S. which identifies by name, address, and telephone number an agent upon whom any Letter of Credit process, notice or demand required or permitted by law to be served upon the bank, may be served.
(i) be more than one year after If the date of issuance thereofbank fails to appoint or maintain an agent in this State, or (ii) whenever any such agent cannot be less than five days prior to reasonably found, then the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of CreditDirector shall be an agent for such bank upon whom any process, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (notice or such shorter period as demand may be agreed by such Issuer) prior written notice, in substantially served for the form purpose of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereofChapter. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreementsuch process, the terms Director shall immediately cause one copy of this Agreement such process, notice or demand to be forwarded by registered mail to the bank at its principal place of business. The Director shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of keep a Letter of Credit Issued by it, record of all drawings processes, notices, or demands served upon him under a Letter this paragraph, and shall record therein the time of Credit Issued by it such service and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);his action with reference thereto.
(ii) Nothing herein contained shall limit or affect the right to serve any process, notice or demand required or permitted by law to be served upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, bank in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) manner now or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined hereafter permitted by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligationlaw.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Financial Assurance Agreement
Letters of Credit. (a) On Each Issuing Bank agrees, on the terms and subject to the conditions contained in this Agreementhereinafter set forth, each Issuer agrees to Issue for the account of the Borrower, one or more Letters of Credit at the request of the Borrower for the account of the Borrower (denominated in United States dollars) from time to time during the period commencing on from the Closing Date and ending until the date which occurs 30 days before the Revolver Termination Date in an aggregate undrawn amount not to exceed at any time $25,000,000, each such Letter of Credit upon its Issuance to expire on or before the earlier of (x) the Revolving Credit date which occurs one year from the date of its Issuance or (y) the Revolver Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer any standby Letter of Credit may by its terms be automatically extendable for up to periods of one year; provided further that any letter of credit issued under the Existing Credit Agreement which continues to be undrawn in whole or in part on the Closing Date shall be under any obligation deemed to be a Letter of Credit Issued hereunder from and after the Closing Date and shall be set forth on Schedule VII; provided further that each Letter of Credit shall be Issued on a sight basis only; provided further no Issuing Bank shall be obligated or permitted to Issue or renew any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance Issuance or renewal of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit Liability and all Advances (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, including any Advances required to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.but
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any fees due and payable in connection with a requested issuance have not been paidcurrency other than Dollars; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall (i) any Letter of Credit be issued within 30 days of the Scheduled Termination Date or (ii) the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof; provided, or (ii) be however, that any Letter of Credit with a term less than five days or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal; and provided, further, that, for any Letter of Credit having an expiration date after the Scheduled Termination Date, the Borrower agrees to deliver to the Administrative Agent on or prior to the Revolving Loan Maturity DateScheduled Termination Date a letter of credit or letters of credit in form and substance acceptable to the Administrative Agent and the applicable Issuer and issued by a bank acceptable to the Administrative Agent and the applicable Issuer, in each case in their sole discretion, and/or cash collateral in an amount equal to 105% of the maximum drawable amount of any such Letter of Credit.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount of the Letter of Credit requested, requested (which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer$100,000), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Credit Agreement (Tekni Plex Inc)
Letters of Credit. (a) On the terms and subject conditions set forth herein, the Bank agrees, from time to time on any Business Day during the period from the date of this Agreement to the conditions contained in this Agreement, each Issuer agrees Maturity Date to Issue one or more issue Letters of Credit at the request of the Borrower for the account of the Borrower. Subject to the terms and conditions of this Agreement, the Borrower's ability to obtain Letters of Credit shall be fully revolving, and, accordingly, the Borrower from time to time may, during the period commencing on the Closing Date term of this Agreement, obtain Letters of Credit to replace Letters of Credit which have expired or which have been drawn upon and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that reimbursed.
(b) The Bank has no Issuer shall be under any obligation to Issue issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport purports by its terms to enjoin or restrain such Issuer the Bank from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Issuer the Bank or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such Issuer shall prohibitthe Bank prohibits, or request requests that such Issuer the Bank refrain from, the issuance of standby letters of credit generally or such Letter of Credit in particular or shall impose imposes upon such Issuer the Bank with respect to such Letter of Credit any restriction or restriction, reserve or capital requirement (for which such Issuer the Bank is not otherwise compensatedcompensated hereunder) not in effect on the date of this Agreement Agreement, or result in imposes upon the Bank any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of applicable on the date of this Agreement and which such Issuer the Bank in good faitx xxxxx xxxxx material xxxerial to it;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 Article III is not then satisfied;
(iii) after giving effect the expiry date of any requested Letter of Credit is (x) more than one (1) year from its date of issuance or (y) later than five (5) Business Days prior to the issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such timeMaturity Date;
(iv) the Outstanding L/C Obligations, after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (Ax) shall exceed $1,000,000.00 or (y) when added to the principal amount of Revolving Credit Loans, shall exceed the lesser of (1) $7,000,000.00 or (2) the aggregate amount of the Borrowing Base; or
(v) any requested Letter of Credit Obligations then outstanding will is not exceed the Letter of Credit Sub-Limit in form and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior substance acceptable to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine thatBank, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of violates any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion applicable policies of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining theretoBank.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause(d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum aggregate of the Revolving Credit Commitments in effect at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;; Credit Agreement FMC Corporation
(v) any fees due and payable in connection with a requested issuance any Issuance have not been paid; or;
(vi) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuer; or
(vii) such Letter of Credit is requested to be denominated in Dollars or in an Alternative Currencyany currency other than Dollars. None of the Revolving Credit Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five thirty (30) days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a one-year term may provide for the renewal thereof for additional one-year periods (which shall in no event extend beyond the expiry date referred to in clause (ii) above).
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) ' prior written notice, in substantially the form of Exhibit D (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “"Letter of Credit Request”"). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the date of the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.42.3, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s 's usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) shall not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuanceIssuance and of the participation of each Revolving Credit Lender in the Letter of Credit Obligations arising with respect thereto in accordance with clause (g) below, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “"Letter of Credit Reimbursement Agreement”"), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.. Credit Agreement FMC Corporation
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which writing may be by telecopier) a telecopy or electronic mail, of the issuance or renewal Issuance of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Revolving Credit Lender);
(ii) upon the request of any Revolving Credit Lender, furnish to such Revolving Credit Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Revolving Credit Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Revolving Credit Lender requesting the same) and the Borrower separate schedules for Documentary Letters of Credit and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Revolving Credit Lender, and each Revolving Credit Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Revolving Credit Lender’s 's Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a any Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a any Letter of Credit when issued for its account no later than the date that is the next succeeding Business Day after the Borrower receives written notice from such amounts are due and payableIssuer that payment has been made under such Letter of Credit (the "Reimbursement Date"), irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or any such payment by the Borrower is rescinded or set aside for any reason, such Reimbursement Obligation shall bear be payable on demand with interest thereon computed (i) from the date on which such Reimbursement Obligation arose to the date of repayment in full Reimbursement Date, at the rate of interest applicable during such period to Revolving Loans bearing that are Base Rate Loans and (ii) from the Reimbursement Date until the date of repayment in full, at the rate of interest at a rate based on the Prime Rate applicable during such periodperiod to past due Revolving Loans that are Base Rate Loans, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Revolving Credit Lender of the failure to repay such Reimbursement Obligationfailure, and each Revolving Credit Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Revolving Credit Lender’s 's Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Revolving Credit Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Revolving Credit Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Revolving Credit Lender, Credit Agreement FMC Corporation such Revolving Credit Lender shall shall, except during the continuance of a Default or Event of Default under Section 9.1(f) (Events of Default) and notwithstanding whether or not the conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit) shall have been satisfied (which conditions precedent the Revolving Credit Lenders hereby irrevocably waive) ), be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Revolving Credit Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Revolving Credit Lender, in immediately available funds, an amount equal to such Revolving Credit Lender’s 's Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Revolving Credit Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Revolving Credit Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Revolving Credit Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Federal Funds Rate and, thereafter, thereafter until such amount is repaid to the Administrative Agent for the account of such Issuer, at a the rate per annum equal to the rate applicable to Prime Base Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s 's obligation to pay each Reimbursement Obligation and the obligations of the Revolving Credit Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective ofof any of the following:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the any Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this SectionSection 2.3, constitute a legal or equitable discharge of the Borrower’s 's obligations hereunder. Credit Agreement FMC Corporation Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) Credit, the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Credit Agreement (FMC Corp)
Letters of Credit. (a) On Subject to and upon the terms and subject conditions herein set forth, including, without limitation, the applicable terms and conditions set forth in Section 8 hereof, the Issuing Bank agrees that it will, at any time and from time to time on or after the conditions contained in this Agreement, each Issuer agrees to Issue one or more Letters Closing Date following its receipt of a Letter of Credit at the request of the Borrower Request, issue for the account of the Borrower from time to time during Borrower, in the period commencing on the Closing Date and ending on the earlier name of the Revolving Credit Termination Date and 30 days prior to Borrower or any Restricted Subsidiary, one or more irrevocable standby or commercial letters of credit (all such letters of credit collectively, the Revolving Loan Maturity Date"Letters of Credit"); provided, however, that no Issuer the Issuing Bank shall be under any obligation to Issue not issue any Letter of Credit ifif at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer the Issuing Bank from issuing such Letter of Credit or any Requirement requirement of Law applicable to such Issuer the Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such Issuer the Issuing Bank shall prohibit, or request that such Issuer the Issuing Bank refrain from, the issuance of letters of credit generally or generally; or
(ii) the Stated Amount of such Letter of Credit (in particular or shall impose upon such Issuer with respect to such Letter the case of Letters of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not denominated in effect on the date of this Agreement or result in any unreimbursed lossAlternate Currencies, cost or expense which was not applicablecalculated, in effect or known to such Issuer as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received written notice from the Administrative Agentissuance, any Lender or the Borrower, on or prior by reference to the requested Dollar Equivalent Value of such Stated Amount) shall be greater than an amount which when added to the Letter of Credit Outstandings at such time (in the case of Letters of Credit denominated in Alternate Currencies, calculated, as of the date of issuance such issuance, by reference to the Dollar Equivalent Value of such Letter of Credit, that one or more Credit Outstandings) and the aggregate principal amount of the applicable conditions contained in Section 3.1 and Section 3.2 is not all Loans then satisfied;
outstanding (iii) after giving effect to the principal amount of all Loans repaid and all Unpaid Drawings reimbursed prior to or concurrently with the issuance of such Letter of Credit) would
(iii) the Stated Amount of such Letter of Credit (in the case of Letters of Credit denominated in Alternate Currencies, calculated, as of the aggregate Revolving date of such issuance, by reference to the Dollar Equivalent Value of such Stated Amount) shall be greater than an amount which when added to the Letter of Credit Outstandings would exceed the Maximum Credit at such time;
time (ivin the case of Letter of Credit Outstandings denominated in Alternate Currencies, calculated, as of the date of such issuance, by reference to the Dollar Equivalent Value of such Letter of Credit Outstandings) (after giving effect to the principal amount of all Unpaid Drawings reimbursed prior to or concurrently with the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding ) would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid$20,000,000; or
(viiv) such Letter of Credit is not denominated the expiry date, or, in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date case of any Letter of Credit (i) be more than one year after containing an expiry date that is extendible at the date option of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of CreditIssuing Bank, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer initial expiry date of such Letter of Credit, is a date that is later than the stated amount earlier of (y) twelve (12) months from the Letter of Credit requested, which stated amount issuance date or (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (Bz) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of CreditMaturity Date.
(db) Subject to The Issuing Bank shall neither renew nor permit the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms renewal of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) if any of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish conditions precedent to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby renewal set forth in Section 8 are not satisfied. The Existing Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations issued hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any No Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor issued, or remain outstanding, for the benefit of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borroweran Unrestricted Subsidiary.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On Subject to the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower, for the account of the Borrower or a Restricted Subsidiary (provided that any Letter of Credit issued for the benefit of any Restricted Subsidiary that is not the Borrower shall be issued naming the Borrower as the account party on any such Letter of Credit but such Letter of Credit may contain a statement that it is being issued for the benefit of such Restricted Subsidiary), one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Effective Date and ending on the earlier of the Revolving Credit Termination Date and 30 days five (5) Business Days prior to the Revolving Loan Maturity DateScheduled Termination Date (without giving effect to any extension of the type referred to in the proviso to Section 12.1(b) hereof) (or, if such day is not a Business Day, the next preceding Business Day), or such later date as agreed to by the Administrative Agent in its sole discretion; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv) and (v)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator having binding powers shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement Effective Date or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement Effective Date and which that such Issuer in good xxxxx xxxxx material to itit (for which such Issuer is not otherwise compensated);
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, (A) the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
, (ivB) after giving effect to the issuance Revolving Credit Outstandings of any Lender would exceed such Letter Lender’s Revolving Credit Commitment or (C) the Outstanding Amount of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(viv) such Letter of Credit is requested to be denominated in any currency other than Dollars, except as may be approved by the Administrative Agent and such Issuer, each in their sole discretion;
(A) any fees due and payable in connection with a requested issuance Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in form and substance reasonably acceptable to it and, if applicable, duly executed by the Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit; or
(vi) any Lender is at that time a Defaulting Lender, unless (i) after giving effect to the requested Issuance, there would exist no Fronting Exposure (in the good faith determination of the applicable Issuer) or (ii) the applicable Issuer has entered into arrangements, including the delivery of Cash Collateral, satisfactory to the applicable Issuer (in its good faith determination) with the Borrower or such Lender to eliminate such Issuer’s actual or potential Fronting Exposure (after giving effect to Section 2.16(a)(iv)) with respect to the Defaulting Lender arising from either the Letter of Credit is not denominated then proposed to be issued or any other Letter of Credit Obligations as to which such Issuer has actual or potential Fronting Exposure, as it may elect in Dollars or in an Alternative Currencyits sole discretion. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit. Any Letter of Credit which has been or deemed Issued hereunder may be amended at any time to reduce the amount outstanding thereunder.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one (1) year after the date of issuance thereofthereof unless the Administrative Agent and the applicable Issuer have approved such later expiry date; provided, or (ii) be however, that any Letter of Credit with a term less than five days or equal to one (1) year may provide for the renewal thereof for additional periods less than or equal to one (1) year, as long as, on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter of Credit shall have the option to prevent such renewal; provided further, that, for any Letter of Credit having an expiration date after the Scheduled Termination Date, the Borrower agrees to deliver to the applicable Issuer on or prior to the Revolving Loan Maturity Datedate that occurs five (5) Business Days prior to the Scheduled Termination Date a letter of credit or letters of credit in form and substance reasonably acceptable to the Administrative Agent and the applicable Issuer issued by a bank acceptable to the Administrative Agent and the applicable Issuer, in each case in their sole discretion, and/or cash collateral in an amount equal to 101% of the maximum drawable amount of any such Letter of Credit.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two (2) Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (or in such other written or electronic form as is acceptable to the such Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount and currency of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) last Business Day on which such notice can be given under the first sentence of this clause (or such shorter period as agreed by c); provided that the relevant Issuer) prior Issuer and the Administrative Agent may agree in a particular instance in their sole discretion to the requested issuance of such Letter of Credita later time and date.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall 4.2 or clause (a) above (other than those conditions set forth in clauses (a)(i), (a)(v)(B) and (C) above and, to the extent such clause relates to fees owing to the Issuer of such Letter of Credit and its Affiliates, clause (a)(v)(A) above) are not on such date be satisfied, satisfied or duly waived and ending when such conditions are satisfiedsatisfied or duly waived. The relevant No Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 4.2 have been satisfied in connection with the issuance Issuance of any Letter of Credit.
(e) If The Borrower agrees that, if requested by the relevant Issuer, Issuer of any Letter of Credit prior to the issuance of each a Letter of Credit by such IssuerCredit, and as it shall execute a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant Agreement in respect to the terms thereofany Letter of Credit Issued hereunder. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shallshall comply with the following:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing), which writing may be by telecopier) a telecopy or electronic mail, of the issuance or renewal Issuance of a any Letter of Credit Issued by itit (including the applicable currency), of all drawings under a any Letter of Credit Issued by it and of the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 on the first Business Days following the last day Day of each calendar monthweek, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary Letters of Credit and Standby Letters of Credit Issued issued by it, in form and substance reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations and applicable currencies, in each case outstanding at the end of each month month, and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On During the Commitment Period, subject to the terms and subject to the conditions contained in this Agreementhereof, each Issuer Issuing Bank agrees to Issue one or more Letters issue standby letters of Credit at the request of the Borrower credit for the account of Account Party; provided that
(i) each Letter of Credit shall be denominated in Dollars;
(ii) the Borrower from time stated amount of each Letter of Credit shall not be less than $25,000 or such lesser amount as is acceptable to time during Issuing Bank;
(iii) after giving effect to such issuance, in no event shall the period commencing on Letter of Credit Usage exceed the Closing Date and ending on Commitments then in effect;
(iv) after giving effect to such issuance, the Cash Collateral held in the Cash Collateral Accounts is not less than 105% of the total undrawn amount of all Letters of Credit securing the Obligations;
(v) in no event shall any Letter of Credit have an expiration date later than the earlier of the Revolving Credit Termination Date and 30 days (1) 5 Business Days prior to the Revolving Loan Maturity DateDate and (2) unless otherwise agreed by Issuing Bank, the date which is seventeen months from the date of issuance of such Letter of Credit; provided, however, that and
(vi) in no Issuer event shall any Letter of Credit be issued in favor of any Person other than the DOE;
(vii) Issuing Bank shall not be under any obligation to Issue issue any Letter of Credit if:
(iA) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms purport to enjoin or restrain such Issuer Issuing Bank from issuing such Letter of Credit Credit, or any Requirement of Law applicable to such Issuer Issuing Bank or any of its property or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer Issuing Bank or any of its property shall prohibit, or request that such Issuer Issuing Bank refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer Issuing Bank with respect to such Letter of Credit any restriction or restriction, reserve or capital requirement (for which such Issuer Issuing Bank is not otherwise compensatedcompensated hereunder) not in effect on the date of this Agreement Closing Date, or result in shall impose upon Issuing Bank any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer as of applicable on the date of this Agreement Closing Date and which such Issuer Issuing Bank in good xxxxx xxxxx material to it;; or
(iiB) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, Credit would violate the aggregate Revolving Credit Outstandings would exceed Organization Documents of the Maximum Credit at such timeIssuing Bank or one or more policies of the Issuing Bank applicable to letters of credit generally;
(ivviii) after giving effect to the issuance of such Letter of CreditIssuing Bank shall not amend, the aggregate amount of extend, replace or renew any Letter of Credit Obligations then outstanding if the Issuing Bank would exceed the Letter of Credit Sublimit;
(v) any fees due and payable in connection with a requested issuance have not been paid; or
(vi) be permitted at such time to issue such Letter of Credit is not denominated in Dollars its amended, extended, replaced or in an Alternative Currency. None of renewed form under the Lenders terms hereof;
(other than ix) the Issuers in their capacity as such) Issuing Bank shall have any be under no obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of amend, extend, replace or renew any Letter of Credit if (iA) be more than one year after the date Issuing Bank would have no obligation at such time to issue such Letter of issuance thereofCredit in its amended, extended, replaced or renewed form under the terms hereof, or (iiB) be less than five days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance beneficiary of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) does not accept the Issuer of such Letter of Credit, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine thatproposed amendment to, or take notice whetherextension, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance replacement or renewal of a Letter of Credit Issued by itof, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vix) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other in no event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with shall any Letter of Credit, if taken by its terms or omitted the terms of any document related thereto, provide for one or more automatic increases in the absence stated amount thereof. Each request by Account Party for the issuance, amendment, extension, replacement or renewal of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face shall be deemed to be in order, without responsibility for further investigation, regardless of any notice or information representation by Account Party that the Credit Extension so requested complies with this Section 2.1(a)(i)-(vi). Subject to the contrary andforegoing, in making any payment under any Issuing Bank may agree that a Letter of Credit will automatically be extended for one or more successive periods not to exceed seventeen months each (x) and in any event not beyond the Issuer may rely exclusively on date which is 5 Business Days prior to the documents presented Maturity Date), unless Issuing Bank elects not to it under extend for any such additional period; provided, Issuing Bank shall not extend any such Letter of Credit as if it has received written notice that an Event of Default has occurred and is continuing at the time Issuing Bank must elect to any and all matters set forth therein, including reliance on the amount of any draft presented under allow such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuerextension.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Samples: Letter of Credit Facility Agreement (Education Management Corporation)
Letters of Credit. (a) On Subject to and upon the terms and conditions set forth herein, Workflow may request the Letter of Credit Issuer at any time and from time to time on or after the Effective Date and prior to the 30th day prior to the Final Maturity Date to issue, for the account of Workflow and in support of (x) trade obligations and other obligations of Workflow or any of its Subsidiaries incurred in the ordinary course of business and (y) such other obligations of Workflow or any of its Subsidiaries to any other Person that are reasonably acceptable to the Agent and the Letter of Credit Issuer, and subject to and upon the terms and conditions set forth herein, the Letter of Credit Issuer agrees to issue from time to time, irrevocable letters of credit in such form as may be approved by the Letter of Credit Issuer and the Agent (each such letter of credit, a “Letter of Credit” and, collectively, the “Letters of Credit”).
(b) The Letter of Credit Issuer hereby agrees that it will (subject to the terms and conditions contained in herein), at any time and from time to time on and after the Effective Date and prior to the 30th day prior to the Final Maturity Date, following its receipt of the respective Letter of Credit Request, issue for the account of Workflow, subject to the terms and conditions of this Agreement, each Issuer agrees to Issue one or more Letters of Credit, provided that the Letter of Credit at the request of the Borrower for the account of the Borrower from time to time during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Date; provided, however, that no Issuer shall be under any no obligation to Issue issue any Letter of Credit ifif at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority governmental authority or arbitrator shall purport by its terms to enjoin or restrain such the Letter of Credit Issuer from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such the Letter of Credit Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority governmental authority with jurisdiction over such the Letter of Credit Issuer shall prohibit, or request that such the Letter of Credit Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such the Letter of Credit Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such the Letter of Credit Issuer is not otherwise compensated) not in effect on the date of this Agreement hereof, or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such the Letter of Credit Issuer as of the date of this Agreement hereof and which such the Letter of Credit Issuer reasonably and in good xxxxx xxxxx material to it;; or
(ii) such the Letter of Credit Issuer shall have received written notice from the Administrative AgentWorkflow, any Lender other Credit Party or the Borrower, on or Required Lenders prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained in Section 3.1 and Section 3.2 is not then satisfied;
(iii) after giving effect to the issuance of such Letter of Credit, Credit of the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
(v) any fees due and payable type described in connection with a requested issuance have not been paid; or
clause (vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, or (ii) be less than five days prior to the Revolving Loan Maturity DateSection 2.01(c).
(c) In connection with Notwithstanding the issuance of each Letter of Creditforegoing, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issueri) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such no Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) issued the Issuer Stated Amount of such Letter of Creditwhich, the stated amount of when added to the Letter of Credit requestedOutstandings at such time, which stated amount (orwould exceed $5,000,000, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested no Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absoluteissued if, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated withafter giving effect thereto, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Aggregate Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by Exposure would exceed the applicable Issuer of the U.S. Dollar Equivalent of Total Revolving Commitment at such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.time,
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Facility Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v), and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx fxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, (A) the aggregate Revolving Credit Outstandings would exceed the Maximum Credit aggregate Commitments in effect at such timetime or (B) the outstanding Loans and Letters of Credit used for the purpose specified in Section 4.12(a)(ii) (Use of Proceeds) would exceed the Working Capital Sublimit;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any fees due and payable in connection with a requested issuance have not been paidcurrency other than Dollars; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated reasonably acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) that such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit. Credit Agreement Macquarie Infrastructure Company Inc. Notwithstanding anything in this Agreement to the contrary, no Issuer shall be required to Issue or amend any Letter of Credit Issued by it if, after giving effect to such Issuance or amendment, the aggregate face amount of all Letters of Credit Issued by such Issuer would exceed the Commitment of such Issuer in its capacity as a Lender or, in the case of any Issuer that is not a Lender hereunder, the Commitment of the Affiliate of such Issuer that is a Lender hereunder.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as, (A) on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (B) neither the Issuer nor the Borrower shall permit any such renewal to extend the expiration date of any Letter beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated face amount of the Letter of Credit requested, requested (which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B$5,000,000) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.42.3, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum aggregate Revolving Credit Commitments at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Letter of Credit Undrawn Amounts at such time and (ii) the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any currency other than Dollars;
(A) any fees due and payable in connection with a requested issuance Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in form and substance reasonably acceptable to it and, if applicable, duly executed by the Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in the ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit; or
(vivii) such Letter of Credit is not denominated in Dollars or in an Alternative Currencya Standby Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof, thereof or (ii) be less than five days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that any Letter of Credit with a term less than or equal to one year may provide for the renewal thereof for additional periods less than or equal to one year, as long as (x) on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter or Credit shall have the option to prevent such renewal and (y) neither the Issuer of such Letter of Credit nor the Borrower shall permit any such renewal to extend the expiration date of any Letter beyond the date set forth in clause (ii) above.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D H (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated Credit and face amount of the Letter of Credit requested, requested (which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer$1,000,000), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.42.3, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.4.2
Appears in 1 contract
Samples: Revolving Credit Agreement (Boardwalk Pipeline Partners, LP)
Letters of Credit. (a) On Subject to and upon the terms and subject conditions set forth herein, the Borrower may request the Issuing Bank, at any time and from time to time after the Effective Date and prior to the conditions contained in this Agreementdate which is 30 days prior to the Maturity Date, each Issuer agrees to Issue one or more Letters of Credit at the request issue on behalf of the Borrower Banks, for the account of the Borrower and in support of, on a standby basis, Letter of Credit Supportable Obligations and, subject to and upon the terms and conditions set forth herein, the Issuing Bank agrees to issue at any time and from time to time during after the period commencing on the Closing Effective Date and ending on prior to the earlier of the Revolving Credit Termination Date and date which is 30 days prior to the Revolving Loan Maturity Date; provided, howeverone or more irrevocable standby letters of credit in such form as may be approved by the Issuing Bank (each such letter of credit, that no Issuer a “Letter of Credit” and, collectively, the “Letters of Credit”). Notwithstanding the foregoing, the Issuing Bank shall be under any no obligation to Issue issue any Letter of Credit ifif at the time of such issuance:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer the Issuing Bank from issuing such Letter of Credit or any Requirement requirement of Law law applicable to such Issuer Issuing Bank or any Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer the Issuing Bank or any Bank shall prohibit, or request that such Issuer the Issuing Bank or any Bank refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer the Issuing Bank or any Bank with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer the Issuing Bank or any Bank is not otherwise compensated) not in effect on the date of this Agreement Effective Date, or result in any unreimbursed loss, cost or expense which was not applicable, in effect or known to such Issuer the Issuing Bank or any Bank as of the date of this Agreement and which such Issuer in good xxxxx xxxxx material to itEffective Date;
(ii) such Issuer shall have received written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained precedent set forth in Section 3.1 and Section 3.2 is 4.02 are not then satisfied;satisfied at that time; or
(iii) after giving effect the Issuing Bank shall have received notice from the Borrower or the Required Banks prior to the issuance of such Letter of Credit, Credit of the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance of such Letter of Credit, the aggregate amount of Letter of Credit Obligations then outstanding would exceed the Letter of Credit Sublimit;
type described in clause (v) of Section 1A.01(b). In the case of clauses (i), (ii) or (iii), the Issuing Bank shall use commercially reasonable efforts to provide notice of any fees due such event to the Borrower and payable in connection with a requested issuance have to the Administrative Agent; provided that the failure to provide any such notice shall not been paid; or
(vi) such Letter of Credit is not denominated in Dollars or in an Alternative Currency. None affect the obligation of the Lenders (other than the Issuers in their capacity as such) shall have any obligation Issuing Bank to Issue issue any Letter of Credit.
(b) In Notwithstanding anything to the contrary contained in this Section 1A.01 or elsewhere in this Agreement (i) no event shall the expiration date of any Letter of Credit shall be issued the Stated Amount of which, when added to (ix) the Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and prior to the issuance of, the respective Letter of Credit) at such time and (y) the aggregate principal amount of all Loans then outstanding, would exceed an amount equal to the Total Commitment at such time; (ii) no Letter of Credit shall be more issued the Stated Amount of which, when added to the Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and prior to the issuance of, the respective Letter of Credit) at such time, exceeds $20,000,000, (iii) each Letter of Credit shall have an expiry date occurring not later than one year after the such Letter of Credit’s date of issuance thereof, or (ii) be less but in no event later than five days Business Days prior to the Revolving Loan Maturity Date.
(c) In connection with the issuance of ); provided that each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) may by its terms automatically renew annually for one additional year unless the Issuer of such Letter of CreditIssuing Bank notifies the beneficiary thereof, the stated amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance of such requested Letter of Credit (which day shall be a Business Day), (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day), and (D) the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effect. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with will not be renewed; (iv) each Letter of Credit shall be denominated in Dollars; and (v) the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under Issuing Bank will not issue any Letter of Credit after it has received written notice from the Borrower or the Required Banks stating that a Default or an Event of Default exists until such time as the Issuing Bank shall have received a written notice of (x) rescission of such notice from the Issuer may rely exclusively on party or parties originally delivering the documents presented same or (y) a waiver of such Default or Event of Default by the Required Banks (or, to it under such the extent provided by Section 11.12, each of the Banks).
(c) Each Letter of Credit as to any will be issued by the Issuing Bank and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such each Bank will participate in each Letter of Credit proves in accordance with Section 1A.04.
(d) Notwithstanding the foregoing, in the event a Bank Default exists, the Issuing Bank shall not be required to be insufficient in issue any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves unless the Issuing Bank has entered into arrangements satisfactory to be forged or invalid or any statement therein proves it and the Borrower (“Section 1A.01(d) Arrangements”) to be inaccurate or untrue eliminate the Issuing Bank’s risk with respect to the participation in any respect whatsoever and (y) any noncompliance in any immaterial respect Letters of Credit of the documents presented under Defaulting Bank or Banks, which may include requiring that the Borrower cash collateralize such Defaulting Bank’s or Banks’ Percentage of the Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the IssuerOutstandings.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
Appears in 1 contract
Letters of Credit. (a) On the terms and subject to the conditions contained in this Agreement, each Issuer agrees to Issue at the request of the Borrower and for the account of the Borrower (or for the joint account of the Borrower and any of its Subsidiaries) one or more Letters of Credit at the request of the Borrower for the account of the Borrower from time to time on any Business Day during the period commencing on the Closing Date and ending on the earlier of the Revolving Credit Termination Date and 30 days prior to the Revolving Loan Maturity Scheduled Termination Date; provided, however, that no Issuer shall be under any obligation to Issue (and, upon the occurrence of any of the events described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not Issue) any Letter of Credit ifupon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such Issuer from issuing Issuing such Letter of Credit or any Requirement of Law applicable to such Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuer shall prohibit, or request that such Issuer refrain from, the issuance Issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuer with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such Issuer is not otherwise compensated) not in effect on the date of this Agreement or result in any unreimbursed loss, cost or expense which that was not applicable, in effect or known to such Issuer as of the date of this Agreement and which that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice from the Administrative Agent, any Lender or the Borrower, on or prior to the requested date of issuance of such Letter of Credit, that one or more of the applicable conditions contained type described in Section 3.1 and Section 3.2 is not then satisfiedclause (d) below;
(iii) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate Revolving Credit Outstandings would exceed the Maximum Credit at such time;
(iv) after giving effect to the issuance Issuance of such Letter of Credit, the aggregate amount sum of (i) the Dollar Equivalents of the Letter of Credit Undrawn Amounts at such time and (ii) the Dollar Equivalents of the Reimbursement Obligations then outstanding would exceed at such time exceeds the Letter of Credit Sublimit;
(v) such Letter of Credit is requested to be denominated in any fees due and payable in connection with a requested issuance have not been paidcurrency other than Dollars; or
(vi) (A) any fees due in connection with a requested Issuance have not been paid, (B) such Letter of Credit is requested to be Issued in a form that is not denominated acceptable to such Issuer or (C) the Issuer for such Letter of Credit shall not have received, in Dollars or form and substance reasonably acceptable to it and, if applicable, duly executed by such Borrower, applications, agreements and other documentation (collectively, a “Letter of Credit Reimbursement Agreement”) such Issuer generally employs in an Alternative Currencythe ordinary course of its business for the Issuance of letters of credit of the type of such Letter of Credit. None of the Lenders (other than the Issuers in their capacity as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i) be more than one year after the date of issuance thereof; provided, or (ii) be however, that any Letter of Credit with a term less than five days prior or equal to one year may provide for the Revolving Loan Maturity Daterenewal thereof for additional periods less than or equal to one year, as long as, on or before the expiration of each such term and each such period, the Borrower and the Issuer of such Letter of Credit shall have the option to prevent such renewal.
(c) In connection with the issuance Issuance of each Letter of Credit, the Borrower shall give the relevant Issuer and the Administrative Agent at least two Business Days’ (or such shorter period as may be agreed by such Issuer) prior written notice, in substantially the form of Exhibit D E (Form of Letter of Credit Request) (or in such other written or electronic form as is acceptable to the Issuer), of the requested issuance Issuance of such Letter of Credit (a “Letter of Credit Request”). Such notice shall be irrevocable and shall (i) specify (A) the Issuer of such Letter of Credit, the stated currency of issuance and face amount of the Letter of Credit requested, which stated amount (or, if such Letter of Credit is to be denominated in Dollars or an Alternative Currency (other than U.S. Dollars), the U.S. Dollar Equivalent of such stated amount) shall not be less than U.S.$5,000 (or such lesser amount as may be agreed to by such Issuer), (B) the date of issuance Issuance of such requested Letter of Credit (which day shall be a Business Day)Credit, (C) the date on which such Letter of Credit is to expire (which date shall be a Business Day)) and, and (D) in the case of an issuance, the Person for whose benefit the requested Letter of Credit is to be Issued and (ii) certify that, after issuance of the requested Letter of Credit, (A) the aggregate amount of the Letter of Credit Obligations then outstanding will not exceed the Letter of Credit Sub-Limit and (B) the sum of the aggregate principal or undrawn amount of the then-outstanding (I) Letter of Credit Obligations, (II) Revolving Loans and (III) Swing Loans, will not exceed the Maximum Credit then in effectissued. Such notice, to be effective, must be received by the relevant Issuer and the Administrative Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day (or such shorter period as agreed by the relevant Issuer) prior to the requested issuance Issuance of such Letter of Credit.
(d) Subject to the satisfaction of the conditions set forth in this Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter of Credit on behalf of the Borrower in accordance with such Issuer’s usual and customary business practices. No Issuer shall Issue any Letter of Credit in the period commencing on the first Business Day after it receives written notice from the Administrative Agent or any Revolving Credit Lender that one or more of the conditions precedent contained in Section 3.2 shall not on such date be satisfied, and ending when such conditions are satisfied. The relevant Issuer shall not otherwise be required to determine that, or take notice whether, the conditions precedent set forth in Section 3.2 have been satisfied in connection with the issuance of any Letter of Credit.
(e) If requested by the relevant Issuer, prior to the issuance of each Letter of Credit by such Issuer, and as a condition of such issuance, the Borrower shall have delivered to such Issuer a letter of credit reimbursement agreement, in such form as the Issuer may employ in its ordinary course of business for its own account (a “Letter of Credit Reimbursement Agreement”), signed by the Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of any conflict between the terms of any Letter of Credit Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall:
(i) give the Administrative Agent written notice (or telephonic notice confirmed promptly thereafter in writing, which may be by telecopier) of the issuance or renewal of a Letter of Credit Issued by it, of all drawings under a Letter of Credit Issued by it and the payment (or the failure to pay when due) by the Borrower of any Reimbursement Obligation when due (which notice the Administrative Agent shall promptly transmit by telecopy, electronic mail or similar transmission to each Lender);
(ii) upon the request of any Lender, furnish to such Lender copies of any Letter of Credit Reimbursement Agreement to which such Issuer is a party and such other documentation as may reasonably be requested by such Lender; and
(iii) no later than 10 Business Days following the last day of each calendar month, provide to the Administrative Agent (and the Administrative Agent shall provide a copy to each Lender requesting the same) and the Borrower separate schedules for Documentary and Standby Letters of Credit Issued by it, in form reasonably satisfactory to the Administrative Agent, setting forth the aggregate Letter of Credit Obligations outstanding at the end of each month and any information requested by the Borrower or the Administrative Agent relating thereto.
(g) Immediately upon the issuance by an Issuer of a Letter of Credit in accordance with the terms and conditions of this Agreement, such Issuer shall be deemed to have sold and transferred to each Lender, and each Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Issuer, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Ratable Portion of the Revolving Credit Commitments, in such Letter of Credit and the obligations of the Borrower with respect thereto (including all Letter of Credit Obligations with respect thereto) and any security therefor and guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of a Letter of Credit the amount of all Reimbursement Obligations owing to such Issuer under a Letter of Credit when such amounts are due and payable, irrespective of any claim, set-off, defense or other right that the Borrower may have at any time against such Issuer or any other Person. In the event that any Issuer makes any payment under any Letter of Credit and the Borrower shall not have repaid such amount to such Issuer pursuant to this clause (h) or such payment is rescinded or set aside for any reason, such Reimbursement Obligation shall bear interest computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to Revolving Loans bearing interest at a rate based on the Prime Rate during such period, and such Issuer shall promptly notify the Administrative Agent, which shall promptly notify each Lender of the failure to repay such Reimbursement Obligation, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuer the amount of such Lender’s Ratable Portion of such payment in Dollars (or, if such payment was made in an Alternative Currency, an amount in Dollars equal to the Dollar equivalent thereof as determined by the Administrative Agent in accordance with its normal banking procedures) and in immediately available funds. If the Administrative Agent so notifies such Lender prior to 11:00 a.m. (New York City time) on any Business Day, such Lender shall make available to the Administrative Agent for the account of such Issuer its Ratable Portion of the amount of such payment on such Business Day in immediately available funds. Upon such payment by a Lender, such Lender shall notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent the Lenders hereby irrevocably waive) be deemed to have made a Revolving Loan to the Borrower in the principal amount of such payment. Whenever any Issuer receives from the Borrower a payment of a Reimbursement Obligation as to which the Administrative Agent has received for the account of such Issuer any payment from a Lender pursuant to this clause (h), such Issuer shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender, in immediately available funds, an amount equal to such Lender’s Ratable Portion of the amount of such payment adjusted, if necessary, to reflect the respective amounts the Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Lender shall not have so made its Ratable Portion of the amount of the payment required by clause (h) above available to the Administrative Agent for the account of such Issuer, such Lender agrees to pay to the Administrative Agent for the account of such Issuer forthwith on demand any such unpaid amount together with interest thereon, for the first Business Day after payment was first due at the Prime Rate and, thereafter, until such amount is repaid to the Administrative Agent for the account of such Issuer, at a rate per annum equal to the rate applicable to Prime Rate Loans under the Revolving Credit Facility. The failure of any Lender to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any such payment shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Issuer its Ratable Portion of any payment on the date such payment is to be made, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the Issuer such other Lender’s Ratable Portion of any such payment.
(j) The Borrower’s obligation to pay each Reimbursement Obligation and the obligations of the Lenders to make payments to the Administrative Agent for the account of the Issuers with respect to Letters of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of:
(i) any lack of validity or enforceability of any Letter of Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right that the Borrower, any other party guaranteeing, or otherwise obligated with, the Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuer, the Administrative Agent or any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuer under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of the Issuer, the Lenders, the Administrative Agent or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of the Borrower’s obligations hereunder. Any action taken or omitted to be taken by the relevant Issuer under or in connection with any Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not put such Issuer under any resulting liability to the Borrower or any Lender. In determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof, the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary and, in making any payment under any Letter of Credit (x) the Issuer may rely exclusively on the documents presented to it under such Letter of Credit as to any and all matters set forth therein, including reliance on the amount of any draft presented under such Letter of Credit, whether or not the amount due to the beneficiary thereunder equals the amount of such draft and whether or not any document presented pursuant to such Letter of Credit proves to be insufficient in any respect, if such document on its face appears to be in order, and whether or not any other statement or any other document presented pursuant to such Letter of Credit proves to be forged or invalid or any statement therein proves to be inaccurate or untrue in any respect whatsoever and (y) any noncompliance in any immaterial respect of the documents presented under such Letter of Credit with the terms thereof shall, in each case, be deemed not to constitute willful misconduct or gross negligence of the Issuer.
(k) Letters of Credit may be Issued in favor of a beneficiary that is a creditor of a Subsidiary of Group provided that the account party with respect to such Letter of Credit is the Borrower.
(l) The amount of Revolving Credit Commitments utilized by Letters of Credit denominated in an Alternative Currency (other than U.S. Dollars) shall be measured by a determination by the applicable Issuer of the U.S. Dollar Equivalent of such Letters of Credit on each day on which a Borrowing Base Certificate is delivered. The applicable Issuers shall notify the Administrative Agent and the Borrower of the aggregate U.S. Dollar Equivalent of such utilization in respect of the Letters of Credit Issued by it.
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