Payment Security Mechanism Sample Clauses
The Payment Security Mechanism clause establishes measures to ensure that payments owed under a contract are reliably secured and protected. Typically, this clause may require the provision of guarantees, letters of credit, escrow arrangements, or other financial instruments to safeguard the interests of the party expecting payment. By implementing such mechanisms, the clause minimizes the risk of non-payment and provides assurance that contractual financial obligations will be met.
Payment Security Mechanism. (A) Letter of Credit (LC):
2.5.1 The Buying Entity shall provide to SECI, in respect of payment of its Monthly Bills, a single, unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained by the Buying Entity, which may be drawn upon by SECI in accordance with this Article. The Buying Entity shall provide SECI draft of the Letter of Credit proposed to be provided to SECI two (2) months before the SCSD.
2.5.2 Not later than one (1) Month before the Start of Supply, the Buying Entity shall through a scheduled bank at open a Letter of Credit in favour of SECI, to be made operative at least 15 days prior to the Due Date of its first Monthly Bill under this Agreement. The Letter of Credit shall have a term of twelve (12) Months and shall be reviewed after every 12 month for an amount equal to:
i) for the first Contract Year, equal to 110% of the estimated average monthly billing;
ii) for each subsequent Contract Year, equal to 110% of the average of the monthly Tariff Payments of the previous Contract Year. Provided that if Buying Entity (Deemed Distribution Licensee) is not covered under the “Implementation of the Electricity (Late Payment Surcharge and related matters) Rules, 2022” issued by Ministry of Power vide OM dated 12.08.2022, the above phrases “110% of the estimated average monthly billing” and “110% of average of the monthly tariff payments of the previous Contract year billing” shall be substituted with “210% of the estimated average monthly billing” and “210% of average of the monthly tariff payments of the previous Contract year” respectively. Further, provided that if the Buying Entity (Deemed Distribution Licensee) is not covered by the State Government Guarantee (including the Tri-Partite Agreement or TPA) or is unable to provide State Government Guarantee (including the Tri-Partite Agreement or TPA), the above phrases “110% of estimated average monthly billing” and “110% of average of the monthly tariff payments of the previous Contract year billing” shall be substituted with “210% of three times the estimated average monthly billing” and “210% of three times average of the monthly tariff payments of the previous Contract year” respectively. Furthermore, provided that if the Buying Entity is other than Deemed Distribution Licensee, the above phrases “110% of estimated average monthly billing” and “110% of average of the monthly tariff payments of the previous Contract year billing” shall be substitute...
Payment Security Mechanism. Letter of Credit (LC):
a) PGVCL shall provide to the SPG, in respect of payment of its Monthly Billsand/or Supplementary Bills, a monthly unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained which may be drawn upon by the SPG in accordance with the PPA.
b) Not later than one (1) Month before the start of supply, PGVCL through a scheduled bank open a Letter of Credit in favour of the SPG, to be made operative from a date prior to the Due Date of its first Monthly Bill under this Agreement. The Letter of Credit shall have a term of twelve (12) Months and shall be renewed annually, for an amount equal to:
i. for the first Contract Year, equal to the estimated average monthly billing;
ii. for each subsequent Contract Year, equal to the average of the monthly billing of the previous Contract Year.
c) Provided that the SPG shall not draw upon such Letter of Credit prior to the Due Date of the relevant Monthly Bill and/or Supplementary Bill, and shall not make more than one drawal in a Month.
d) Provided further that if at any time, such Letter of Credit amount falls short of the amount specified above due to any reason whatsoever, PGVCL shall restore such shortfall within fifteen (15) days.
e) PGVCL shall cause the scheduled bank issuing the Letter of Credit to intimate the SPG, in writing regarding establishing of such irrevocable Letter of Credit.
f) PGVCL shall ensure that the Letter of Credit shall be renewed not later than its expiry.
g) All costs relating to opening, maintenance of the Letter of Credit shall be borne by the SPG.
h) If PGVCL fails to pay undisputed Monthly Bill or Supplementary Bill or a part thereof within and including the Due Date, then, subject to above, the SPG may draw upon the Letter of Credit, and accordingly the bank shall pay without any reference or instructions from PGVCL, an amount equal to such Monthly Bill or Supplementary Bill or part thereof, in accordance with above, by presenting to the scheduled bank issuing the Letter of Credit, the following documents:
i. a copy of the Monthly Bill or Supplementary Bill which has remained unpaid to SPG and;
ii. a certificate from the SPG to the effect that the bill at item (a) above, or specified part thereof, is in accordance with the Agreement, is not disputed and hasremained unpaid beyond the Due Date;
Payment Security Mechanism. (A) Letter of Credit (LC):
2.5.1 The Buying Entity shall provide to SECI, in respect of payment of its Monthly Bills, a single, unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained by the Buying Entity, which may be drawn upon by SECI in accordance with this Article. The Buying Entity shall provide SECI draft of the Letter of Credit proposed to be provided to SECI two (2) months before the Scheduled Commissioning Date.
2.5.2 Not later than one (1) Month before the Start of Supply, the Buying Utility shall through a scheduled bank at open a Letter of Credit in favour of SECI, to be made operative at least 15 days prior to the Due Date of its first Monthly ▇▇▇▇ under this Agreement. The Letter of Credit shall have a term of twelve (12) Months and shall be reviewed after every 12 month for an amount equal to:
i) for the first Contract Year, equal to 1 month of the estimated average monthly billing;
ii) for each subsequent Contract Year, equal to 1.05 times of the average of the monthly Tariff Payments of the previous Contract Year.
2.5.3 SECI shall not draw upon such Letter of Credit prior to the Due Date of the relevant Monthly ▇▇▇▇, and shall not make more than one drawal in a Month provided that there are no outstanding dues.
2.5.4 Provided further that if at any time, such Letter of Credit amount falls short of the amount specified in Article 2.5.2 due to any reason whatsoever, the Buying Entity shall restore such shortfall within seven (7) days.
2.5.5 The Buying Entity shall cause the scheduled bank issuing the Letter of Credit to intimate SECI, in writing regarding establishing of such irrevocable Letter of Credit and any of the changes therein.
2.5.6 The Buying Entity shall ensure that the Letter of Credit shall be renewed not later than its expiry.
2.5.7 All costs relating to opening, maintenance of the Letter of Credit shall be borne by the Buying Entity.
2.5.8 If the Buying Entity fails to pay a Monthly ▇▇▇▇ or part thereof within and including the Due Date, then, subject to Article 2.5.3 and 2.9, SECI may draw upon the Letter of Credit, and accordingly the bank shall pay without any reference or instructions from the Buying Entity, an amount equal to such Monthly ▇▇▇▇ or part thereof, by presenting to the scheduled bank issuing the Letter of Credit, the following documents:
i) a copy of the Monthly ▇▇▇▇ which has remained unpaid by the Buying Entity;
ii) a certificate from SECI to the effect that the...
Payment Security Mechanism. A. Letter of Credit (LC):
6.4.1 Buying Entity shall provide to Buyer, in respect of payment of its Monthly Bills, an unconditional, revolving and irrevocable letter of credit as a backup arrangement which is to be negotiated only on default conditions (“Letter of Credit”), opened and maintained by Buying Entity, which may be drawn upon by Buyer in accordance with this Article. Buying Entity shall provide Buyer draft of the Letter of Credit proposed to be provided to Buyer two (2) months before the Scheduled Commissioning Date.
6.4.2 Not later than one (1) Month before the Start of Supply, Buying Entity shall through a scheduled bank at open a Letter of Credit in favour of Buyer, to be made operative at least 15 days prior to the Due Date of its first Monthly ▇▇▇▇ under this Agreement. The Letter of Credit shall have a term of twelve (12) Months and shall be reviewed every 6 months, in the month of January and July and revised w.e.f. April and Sept. for an amount equal to:
i) for the first Contract Year, equal to 105% of the estimated average monthly billing;
ii) for each subsequent Contract Year, equal to 105% of the average of the monthly Tariff Payments of the previous Contract Year.
6.4.3 Provided that Buyer shall not draw upon such Letter of Credit prior to 30 days beyond the Due Date of the relevant Monthly ▇▇▇▇, and shall not make more than one drawal in a Month.
6.4.4 Provided further that if at any time, such Letter of Credit amount falls short of the amount specified in Article 6.4.2 due to any reason whatsoever, Buying Entity shall restore such shortfall within seven (7) days.
6.4.5 Buying Entity shall cause the scheduled bank issuing the Letter of Credit to intimate Buyer, in writing regarding establishing of such irrevocable Letter of Credit.
6.4.6 Buying Entity shall ensure that the Letter of Credit shall be renewed prior to its expiry.
6.4.7 All costs relating to opening, maintenance of the Letter of Credit shall be borne by Buying Entity.
6.4.8 If Buying Entity fails to pay a Monthly ▇▇▇▇ or part thereof within and including 30 days beyond its Due Date, then, subject to Article 6.4.3 and 6.6.2, Buyer may draw upon the Letter of Credit, and accordingly the bank shall pay without any reference or instructions from Buying Entity, an amount equal to such Monthly ▇▇▇▇ or part thereof, by presenting to the scheduled bank issuing the Letter of Credit, the following documents:
i) a copy of the Monthly ▇▇▇▇ which has remained unpaid by Buying Entity;...
Payment Security Mechanism. Letter of Credit (LC):
10.4.1 NTPC shall provide to the SPD, in respect of payment of its Monthly Bills and/or Supplementary Bills, a monthly unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained which may be drawn upon by the SPD in accordance with this Article.
10.4.2 Not later than one (1) Month before the start of supply, NTPC through a scheduled bank at New Delhi open a Letter of Credit in favour of the SPD, to be made operative from a date prior to the Due Date of its first Monthly ▇▇▇▇ under this Agreement. The Letter of Credit shall have a term of twelve (12) Months and shall be renewed annually, for an amount equal to:
i) for the first Contract Year, equal to the estimated average monthly billing;
ii) for each subsequent Contract Year, equal to the average of the monthly billing of the previous Contract Year.
10.4.3 Provided that the SPD shall not draw upon such Letter of Credit prior to the Due Date of the relevant Monthly ▇▇▇▇ and/or Supplementary ▇▇▇▇, and shall not make more than one drawal in a Month.
10.4.4 Provided further that if at any time, such Letter of Credit amount falls short of the amount specified in Article 10.4.2 due to any reason whatsoever, NTPC shall restore such shortfall within seven (7) days.
10.4.5 NTPC shall cause the scheduled bank issuing the Letter of Credit to intimate the SPD, in writing regarding establishing of such irrevocable Letter of Credit.
10.4.6 NTPC shall ensure that the Letter of Credit shall be renewed not later than thirty (30) days prior to its expiry.
10.4.7 All costs relating to opening, maintenance of the Letter of Credit shall be borne by NTPC.
10.4.8 If NTPC fails to pay a Monthly ▇▇▇▇ or Supplementary ▇▇▇▇ or part thereof within and including the Due Date, then, subject to Article 10.4.6, the SPD may draw upon the Letter of Credit, and accordingly the bank shall pay without any reference or instructions from NTPC, an amount equal to such Monthly ▇▇▇▇ or Supplementary ▇▇▇▇ or part thereof, if applicable, in accordance with Article 10.3.3 above, by presenting to the scheduled bank issuing the Letter of Credit, the following documents:
i) a copy of the Monthly ▇▇▇▇ or Supplementary ▇▇▇▇ which has remained unpaid to SPD and;
ii) a certificate from the SPD to the effect that the ▇▇▇▇ at item (i) above, or specified part thereof, is in accordance with the Agreement and has remained unpaid beyond the Due Date;
Payment Security Mechanism. 10.4.1 UPPCL shall provide to the SPD, in respect of payment of its Monthly Bills and/or Supplementary Bills, an unconditional, weekly revolving letter of credit (“Letter of Credit”), opened and maintained which may be drawn upon by the SPD in accordance with this Article. The Letter of Credit will be provided by the UPPCL as per Electricity (Late Payment Surcharge & Related matters) Rules 2022, including amendments and clarification, if any thereof, issued firm time to time. Before the start of supply, UPPCL shall, through a scheduled bank, open a Letter of Credit in favour of the SPD, to be made operative from a date prior to the Due Date of its first Monthly Bill under this Agreement. The Letter of Credit shall have a term of twelve (12) Months and shall be renewed annually, for an amount equal to:
(i) for the first Contract Year, equal to 100% of the estimated average monthly billing;
(ii) for each subsequent Contract Year, equal to 100% of the average of the monthly billing of the previous Contract Year.
10.4.2 Provided that the SPD shall not draw upon such Letter of Credit prior to the Due Date of the relevant Monthly Bill and/or Supplementary Bill, and shall not make more than one (1) drawal in a Month.
10.4.3 Provided further that if at any time, such Letter of Credit amount falls short of the amount specified in Article 10.4.1 due to any reason whatsoever, UPPCL shall restore such shortfall before next drawl.
10.4.4 UPPCL shall cause the scheduled bank issuing the Letter of Credit to intimate the SPD, in writing regarding establishing of such irrevocable Letter of Credit.
10.4.5 UPPCL shall ensure that the Letter of Credit shall be renewed not later than its expiry.
10.4.6 All costs relating to opening, maintenance of the Letter of Credit shall be borne by UPPCL.
10.4.7 If UPPCL fails to pay undisputed Monthly Bill or Supplementary Bill or a part thereof within and including the Due Date, then, subject to Article 10.4.2 & 10.5.2, the SPD may draw upon the Letter of Credit, and accordingly the bank shall pay, an amount equal to such Monthly Bill or Supplementary Bill or part thereof, by presenting to the scheduled bank issuing the Letter of Credit, the following documents:
(i) a copy of the Monthly Bill or Supplementary Bill (only for energy related bills) which has remained unpaid to SPD and;
(ii) a certificate from the SPD to the effect that the bill at item (i) above, or specified part thereof, is in accordance with the Agreement and has remaine...
Payment Security Mechanism. (A) Letter of Credit (LC):
2.5.1 The Buying Entity shall provide to SECI, in respect of payment of its Monthly Bills, a single, unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained by the Buying Entity, which may be drawn upon by SECI in accordance with this Article. The Buying Entity shall provide SECI draft of the Letter of Credit proposed to be provided to SECI two (2) months before the Scheduled Commissioning Date.
2.5.2 Not later than one (1) Month before the Start of Supply, the Buying Utility shall through a scheduled bank at [insert the place] open a Letter of Credit in favour of SECI, to be made operative at least 15 days prior to the Due Date of its first Monthly ▇▇▇▇ under this Agreement. The Letter of Credit shall have a term of twelve (12) Months and shall be reviewed for every six (6) months, and revised w.e.
Payment Security Mechanism. 15.8.1. In order to assure payment of the Authority‟s obligation to the Concessionaire under this Agreement, the Authority shall, prior to the COD, establish with ..................11 (“Account Bank”) a no lien bank account with revolving cash- credit limit of a sum equivalent to 1.5 (one and half) months of estimated annual Storage Charges as applicable for the relevant Financial Year and authorise the Account Bank to issue payment to the Concessionaire for unpaid Undisputed Amounts of Invoices raised by the Concessionaire in respect of the Project built under this Agreement. 11 A scheduled commercial Bank which is agreeable to extend such facility to the Authority
15.8.2. Upon the presentation of an unpaid Invoice, the Account Bank shall release to the Concessionaire on the Payment Due Date Undisputed Amounts. The amounts under this Clause15.8.2 shall be released directly into the Designated Bank Account of the Concessionaire with an advice by the Account Bank to both the Parties for such activity.
15.8.3. The Authority undertakes not to create any charge or encumbrance on the Payment Security Deposit and to clear the dues of the Account Bank for the Payment Security Deposit such that the Payment Security Deposit is adequately maintained.
15.8.4. The administrative charge by the Account Bank shall be borne equally between the Parties and shall be duly deducted from amounts released by the Account Bank.
Payment Security Mechanism. Third Party Sales by the Seller........................................................................................................................
Payment Security Mechanism. Letter of Credit (LC):
10.4.1 The Procurers shall provide to the Seller, in respect of payment of its Monthly Bills, an unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained by the Procurers, which may be drawn upon by the Seller in accordance with this Article. The Procurers shall provide to the Seller draft of the Letter of Credit proposed to be provided to the Seller two (2) months before the Scheduled Commissioning Date.
10.4.2 Not later than one (1) month before the start of supply, the Procurers shall through a scheduled bank at Lucknow open a Letter of Credit in favour of the Seller, to be made operative at least 15 days prior to the Due Date of its first Monthly ▇▇▇▇ under this Agreement. The Letter of Credit shall have a term of twelve (12) months and shall be reviewed every year, in the month of January and revised w.e.