Common use of Payment Security Mechanism Letter of Credit (LC) Clause in Contracts

Payment Security Mechanism Letter of Credit (LC). 10.4.1 The Buyer shall provide to the HPD, in respect of payment of its Monthly Bills and/or Supplementary Bills, a monthly standby letter of credit (“Letter of Credit”), opened and maintained which may be drawn upon by the HPD in accordance with this Article. 10.4.2 Before the start of supply, the Buyer shall, through a scheduled bank, open a Letter of Credit in favour of the HPD, 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 12 (twelve) Months and shall be renewed annually, for an amount equal to: (i) for the first Contract Year, equal to 110% (one hundred and ten percent) of the estimated average monthly billing; (ii) for each subsequent Contract Year, equal to 110% (one hundred and ten percent) of the average of the monthly billing of the previous Contract Year. 10.4.3 Provided that the HPD 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. 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, the Buyer shall restore such shortfall before next drawl. 10.4.5 The Buyer shall cause the scheduled bank issuing the Letter of Credit to intimate the HPD, in writing regarding establishing of such irrevocable Letter of Credit. 10.4.6 The Buyer shall ensure that the Letter of Credit shall be renewed not later than its current expiry date. 10.4.7 All costs relating to the opening and maintenance of the Letter of Credit shall be borne by the Buyer. 10.4.8 If the Buyer fails to pay undisputed Monthly Bill or Supplementary Bill or a part thereof within and including the Due Date, then, subject to Article 10.4.6 & 10.5.2, the HPD 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, in accordance with Article 10.4.3 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 (only for energy related bills) which has remained unpaid to HPD and; (ii) a certificate from the HPD to the effect that the bill 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 Letter of Credit (LC). 10.4.1 The Buyer Subject to opening and maintenance of Letter of Credit by the Buying Entities (as per terms of SECI-Buying Entity PSA) in favour of the Buyer, the SECI shall provide to the HPD, in respect of payment of its Monthly Bills and/or Supplementary Bills, a monthly standby unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained which may be drawn upon by the HPD in accordance with this Article. 10.4.2 Before Subject to Article 10.4.1, not later than one (1) Month before the start of supply, the Buyer shall, SECI through a scheduled bank, bank open a Letter of Credit in favour of the HPD, to be made operative from a date prior to the Due Date of its first Monthly Bill Xxxx under this Agreement. The Letter of Credit shall have a term of 12 twelve (twelve12) Months and shall be renewed annually, for an amount equal to: (i) for the first Contract Year, equal to 110% (one hundred and ten percent) of the estimated average monthly billing; (ii) for each subsequent Contract Year, equal to 110% (one hundred and ten percent) of the average of the monthly billing of the previous Contract Year. 10.4.3 Provided that the HPD shall not draw upon such Letter of Credit prior to the Due Date of the relevant Monthly Bill Xxxx and/or Supplementary BillXxxx, 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, the Buyer SECI shall restore such shortfall before next drawlwithin fifteen (15) days. 10.4.5 The Buyer SECI shall cause the scheduled bank issuing the Letter of Credit to intimate the HPD, in writing regarding establishing of such irrevocable Letter of Credit. 10.4.6 The Buyer SECI shall ensure that the Letter of Credit shall be renewed not later than its current expiry dateexpiry. 10.4.7 All costs relating to the opening and opening, maintenance of the Letter of Credit shall be borne by the BuyerSECI/HPD. 10.4.8 If the Buyer SECI fails to pay undisputed Monthly Bill Xxxx or Supplementary Bill Xxxx or a part thereof within and including the Due Date, then, subject to Article 10.4.6 & 10.5.2, the HPD may draw upon the Letter of Credit, and accordingly the bank shall paypay without any reference or instructions from SECI, an amount equal to such Monthly Bill Xxxx or Supplementary Bill Xxxx or part thereof, in accordance with Article 10.4.3 above, by presenting to the scheduled bank issuing the Letter of Credit, the following documents: (i) a copy of the Monthly Bill Xxxx or Supplementary Bill (only for energy related bills) Xxxx which has remained unpaid to HPD and; (ii) a certificate from the HPD to the effect that the bill xxxx 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 Letter of Credit (LC). 10.4.1 The Buyer SECI shall provide to the HPDWPD, in respect of payment of its Monthly Bills and/or Supplementary Bills, a monthly standby unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained which may be drawn upon by the HPD WPD in accordance with this Article. 10.4.2 Before the start of supply, the Buyer shall, SECI through a scheduled bank, bank open a Letter of Credit in favour of the HPDWPD, to be made operative from a date prior to the Due Date of its first Monthly Bill Xxxx under this Agreement. The Letter of Credit shall have a term of 12 twelve (twelve12) Months and shall be renewed annually, for an amount equal to: (i) for the first Contract Year, equal to 110% (one hundred and ten percent) of the estimated average monthly billing; (ii) for each subsequent Contract Year, equal to 110% (one hundred and ten percent) of the average of the monthly billing of the previous Contract Year. 10.4.3 Provided that the HPD WPD shall not draw upon such Letter of Credit prior to 30 days beyond the Due Date of the relevant Monthly Bill Xxxx and/or Supplementary BillXxxx, 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, the Buyer SECI shall restore such shortfall before next drawl. 10.4.5 The Buyer SECI shall cause the scheduled bank issuing the Letter of Credit to intimate the HPDWPD, in writing regarding establishing of such irrevocable Letter of Credit. 10.4.6 The Buyer SECI shall ensure that the Letter of Credit shall be renewed not later than its current expiry dateexpiry. 10.4.7 All costs relating to the opening and opening, maintenance of the Letter of Credit shall be borne by the BuyerSECI. 10.4.8 If the Buyer SECI fails to pay undisputed Monthly Bill Xxxx or Supplementary Bill Xxxx or a part thereof within and including date as on 30 days beyond the Due Date, then, subject to Article 10.4.6 & 10.5.2, the HPD 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, in accordance with Article 10.4.3 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 (only for energy related bills) which has remained unpaid to HPD and; (ii) a certificate from the HPD to the effect that the bill at item (i) above, or specified part thereof, is in accordance with the Agreement and has remained unpaid beyond the Due Date;Article

Payment Security Mechanism Letter of Credit (LC). 10.4.1 The Buyer Electricity Department Daman shall provide to the HPDSPD, in respect of payment of its Monthly Bills and/or Supplementary Bills, a monthly standby unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained which may be drawn upon by the HPD SPD in accordance with this Article.. NTPC Vidyut Xxxxxx Xxxxx Ltd. 26 10.4.2 Before Not later than one (1) Month before the start of supply, the Buyer shall, Electricity Department Daman through a scheduled bank, bank at Daman open a Letter of Credit in favour of the HPDSPD, to be made operative from a date prior to the Due Date of its first Monthly Bill Xxxx under this Agreement. The Letter of Credit shall have a term of 12 twelve (twelve12) Months and shall be renewed annually, for an amount equal to: (i) for the first Contract Year, equal to 110% (one hundred and ten percent) of the estimated average monthly billing; (ii) for each subsequent Contract Year, equal to 110% (one hundred and ten percent) of the average of the monthly billing of the previous Contract Year. 10.4.3 Provided that the HPD SPD shall not draw upon such Letter of Credit prior to the Due Date of the relevant Monthly Bill Xxxx and/or Supplementary BillXxxx, 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, the Buyer Electricity Department Daman shall restore such shortfall before next drawlwithin seven (7) days. 10.4.5 The Buyer Electricity Department Daman shall cause the scheduled bank issuing the Letter of Credit to intimate the HPDSPD, in writing regarding establishing of such irrevocable Letter of Credit. 10.4.6 The Buyer Electricity Department Daman shall ensure that the Letter of Credit shall be renewed not later than thirty (30) days prior to its current expiry dateexpiry. 10.4.7 All costs relating to the opening and opening, maintenance of the Letter of Credit shall be borne by the Buyer.Electricity Department Daman 10.4.8 If the Buyer Electricity Department Daman fails to pay undisputed a Monthly Bill Xxxx or Supplementary Bill Xxxx or a part thereof within and including the Due Date, then, subject to Article 10.4.6 & 10.5.210.4.6, the HPD SPD may draw upon the Letter of Credit, and accordingly the bank shall paypay without any reference or instructions from Electricity Department Daman, an amount equal to such Monthly Bill Xxxx or Supplementary Bill Xxxx or part thereof, if applicable, in accordance with Article 10.4.3 10.3.3 above, by presenting to the scheduled bank issuing the Letter of Credit, the following documents: (i) a copy of the Monthly Bill Xxxx or Supplementary Bill (only for energy related bills) Xxxx which has remained unpaid to HPD SPD and; (ii) a certificate from the HPD SPD to the effect that the bill xxxx 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 Letter of Credit (LC). 10.4.1 The Subject to opening and maintenance of Letter of Credit by the Buying Entities (as per terms of Buyer-Buying Entity PSA) in favour of the Buyer, the Buyer shall provide to the HPD, in respect of payment of its Monthly Bills and/or Supplementary Bills, a monthly standby unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained which may be drawn upon by the HPD in accordance with this Article. 10.4.2 Before Subject to Article 10.4.1, not later than one (1) Month before the start of supply, the Buyer shall, through a scheduled bank, bank open a Letter of Credit in favour of the HPD, to be made operative from a date prior to the Due Date of its first Monthly Bill Xxxx under this Agreement. The Letter of Credit shall have a term of 12 twelve (twelve12) Months and shall be renewed annually, for an amount equal to: (i) for the first Contract YearYear (post COD), equal to 110% (one hundred and ten percent) of the estimated average monthly billing; (ii) for each subsequent Contract Year, equal to 110% (one hundred and ten percent) of the average of the monthly billing of the previous Contract Year. 10.4.3 Provided that the HPD shall not draw upon such Letter of Credit prior to the Due Date of the relevant Monthly Bill Xxxx and/or Supplementary BillXxxx, 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, the Buyer shall restore such shortfall before next drawlwithin fifteen (15) days. 10.4.5 The Buyer shall cause the scheduled bank issuing the Letter of Credit to intimate the HPD, in writing regarding establishing of such irrevocable Letter of Credit. 10.4.6 The Buyer shall ensure that the Letter of Credit shall be renewed not later than its current expiry dateexpiry. 10.4.7 All costs relating to the opening and opening, maintenance of the Letter of Credit shall be borne by the Buyer. 10.4.8 If the Buyer fails to pay undisputed a Monthly Bill Xxxx or Supplementary Bill or a part thereof within and including the Due Date, then, subject to Article 10.4.6 & 10.5.2, the HPD may draw upon the Letter of Credit, and accordingly the bank shall paypay without any reference or instructions from Buyer, an amount equal to such Monthly Bill or Supplementary Bill Xxxx or part thereof, in accordance with Article 10.4.3 above, by presenting to the scheduled bank issuing the Letter of Credit, the following documents: (i) a copy of the Monthly Bill Xxxx or Supplementary Bill (only for energy related bills) Xxxx which has remained unpaid to HPD and; (ii) a certificate from the HPD to the effect that the bill xxxx 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 Letter of Credit (LC). 10.4.1 The Buyer SECI shall provide to the HPDWPD, in respect of payment of its Monthly Bills and/or Supplementary Bills, a monthly standby unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained which may be drawn upon by the HPD WPD in accordance with this Article. 10.4.2 Before the start of supply, the Buyer shall, SECI through a scheduled bank, bank open a Letter of Credit in favour of the HPDWPD, to be made operative from a date prior to the Due Date of its first Monthly Bill Xxxx under this Agreement. The Letter of Credit shall have a term of 12 twelve (twelve12) Months and shall be renewed annually, for an amount equal to: (i) for the first Contract Year, equal to 110% (one hundred and ten percent) of the estimated average monthly billing; (ii) for each subsequent Contract Year, equal to 110% (one hundred and ten percent) of the average of the monthly billing of the previous Contract Year. 10.4.3 Provided that the HPD WPD shall not draw upon such Letter of Credit prior to 30 days beyond the Due Date of the relevant Monthly Bill Xxxx and/or Supplementary BillXxxx, 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, the Buyer SECI shall restore such shortfall before next drawl. 10.4.5 The Buyer SECI shall cause the scheduled bank issuing the Letter of Credit to intimate the HPDWPD, in writing regarding establishing of such irrevocable Letter of Credit. 10.4.6 The Buyer SECI shall ensure that the Letter of Credit shall be renewed not later than its current expiry dateexpiry. 10.4.7 All costs relating to the opening and opening, maintenance of the Letter of Credit shall be borne by the BuyerSECI. 10.4.8 If the Buyer SECI fails to pay undisputed Monthly Bill Xxxx or Supplementary Bill Xxxx or a part thereof within and including the Due Date, then, subject to Article 10.4.6 & 10.5.2, the HPD WPD may draw upon the Letter of Credit, and accordingly the bank shall pay, an amount equal to such Monthly Bill Xxxx or Supplementary Bill Xxxx or part thereof, in accordance with Article 10.4.3 above, by presenting to the scheduled bank issuing the Letter of Credit, the following documents: (i) a copy of the Monthly Bill Xxxx or Supplementary Bill Xxxx (only for energy related bills) which has remained unpaid to HPD WPD and; (ii) a certificate from the HPD WPD to the effect that the bill xxxx 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 Letter of Credit (LC). 10.4.1 The Buyer shall provide to the HPD, in respect of payment of its Monthly Bills and/or Supplementary Bills, a monthly standby unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained which may be drawn upon by the HPD in accordance with this Article. 10.4.2 Before Subject to Article 10.4.1, not later than one (1) Month before the start of supply, the Buyer shall, through a scheduled bank, bank open a Letter of Credit in favour of the HPD, to be made operative from a date prior to the Due Date of its first Monthly Bill Xxxx under this Agreement. The Letter of Credit shall have a term of 12 twelve (twelve12) Months and shall be renewed annually, for an amount equal to: (i) for the first Contract YearYear (post COD), equal to 110% (one hundred and ten percent) of the estimated average monthly billing; (ii) for each subsequent Contract Year, equal to 110% (one hundred and ten percent) of the average of the monthly billing of the previous Contract Year. 10.4.3 Provided that the HPD shall not draw upon such Letter of Credit prior to the Due Date of the relevant Monthly Bill Xxxx and/or Supplementary BillXxxx, 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, the Buyer shall restore such shortfall before next drawlwithin fifteen (15) days. 10.4.5 The Buyer shall cause the scheduled bank issuing the Letter of Credit to intimate the HPD, in writing regarding establishing of such irrevocable Letter of Credit. 10.4.6 The Buyer shall ensure that the Letter of Credit shall be renewed not later than its current expiry dateexpiry. 10.4.7 All costs relating to the opening and opening, maintenance of the Letter of Credit shall be borne by the BuyerBuyer . 10.4.8 If the Buyer fails to pay undisputed a Monthly Bill Xxxx or Supplementary Bill or a part thereof within and including the Due Date, then, subject to Article 10.4.6 & 10.5.2, the HPD may draw upon the Letter of Credit, and accordingly the bank shall paypay without any reference or instructions from Buyer, an amount equal to such Monthly Bill or Supplementary Bill Xxxx or part thereof, in accordance with Article 10.4.3 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 (only for energy related bills) which has remained unpaid to HPD and; (ii) a certificate from the HPD to the effect that the bill at item (i) above, or specified part thereof, is in accordance with the Agreement and has remained unpaid beyond the Due Date;Article

Payment Security Mechanism Letter of Credit (LC). 10.4.1 6.4.1 The Buyer USER shall provide to the HPDSPD, in respect of payment of its Monthly Bills and/or Supplementary Bills, a monthly standby an unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained by the Buying Entity, which may be drawn upon by the HPD SPD in accordance with this Article. The USER shall provide SPD draft of the Letter of Credit proposed to be provided to SPD two (2) months before the Scheduled Commissioning Date. 10.4.2 Before 6.4.2 Not later than one (1) Month before the start Start of supplySupply, the Buyer shall, USER shall through a scheduled bank, bank at open a Letter of Credit in favour of the HPDSPD, to be made operative from a date at least 15 days prior to the Due Date of its first Monthly Bill Xxxx under this Agreement. The Letter of Credit shall have a term of 12 twelve (twelve12) Months and shall be renewed annuallyreviewed for every year in the month of January, and revised w.e.f. April for an 105% of amount equal toin the following manner: (i) for For the first Contract YearYear in which COD of the project falls, equal to 110% (one hundred and ten percent) of the estimated average monthly billing;. (ii) for For each subsequent Contract Yearcontract year, equal to 110% (one hundred monthly average billing for the previous contract year and ten percent) of the average of the estimated monthly billing of for the previous Contract Yearnew capacities. 10.4.3 6.4.3 Provided that the HPD SPD shall not draw upon such Letter of Credit prior to the Due Date of the relevant Monthly Bill and/or Supplementary BillXxxx, and shall not make more than one drawal drawl in a Month. 10.4.4 6.4.4 Provided further that if at any time, such Letter of Credit amount falls short of the amount specified in Article 10.4.2 6.4.2 due to any reason whatsoever, the Buyer USER shall restore such shortfall before next drawlwithin seven (7) days from the occurrence of such shortfall. 10.4.5 6.4.5 The Buyer USER shall cause the scheduled bank issuing the Letter of Credit to intimate the HPDSPD, in writing regarding establishing of such irrevocable Letter of CreditCredit and of any changes therein. 10.4.6 6.4.6 The Buyer USER shall ensure that the Letter letter of Credit credit shall be renewed not later than Thirty (30) days prior to its current expiry dateexpiry. 10.4.7 6.4.7 All costs relating to the opening and maintenance of the Letter of Credit shall be borne by the BuyerBuying Entity. 10.4.8 6.4.8 If the Buyer USER fails to pay undisputed a Monthly Bill Xxxx or Supplementary Bill or a part thereof within and including the Due Date, then, subject to Article 10.4.6 & 10.5.26.6.1 and 6.6.2, the HPD SPD may draw upon the Letter of Credit, and accordingly the bank shall paypay without any reference or instructions from the Buying Entity, an amount equal to such Monthly Bill or Supplementary Bill Xxxx or part thereof, in accordance with Article 10.4.3 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 (only for energy related bills) Xxxx which has remained unpaid to HPD and; (by the Buying Entity; ii) a certificate from the HPD SPD to the effect that the bill xxxx at item (i) above, or specified part thereof, is in accordance with the Agreement and has remained unpaid beyond the Due Date; 6.4.9 [Not Used] 6.4.10 [Not Used] 6.4.11 [Not Used]

Payment Security Mechanism Letter of Credit (LC). 10.4.1 The Buyer 11.6.1 SECI shall provide to the HPDGAP, in respect of payment of its Monthly Monthly/Periodic Bills and/or Supplementary Bills, a monthly standby unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained which may be drawn upon by the HPD GAP in accordance with this Article. 10.4.2 11.6.2 Before the start of supply, the Buyer SECI shall, through a scheduled bank, open a Letter of Credit in favour of the HPDGAP, to be made operative from a date prior to the Due Date of its first Monthly Monthly/Periodic Bill under this Agreement. The Letter of Credit shall have a term of 12 twelve (twelve12) Months and shall be renewed annually, for an amount equal to: (i) a. for the first Contract Year, equal to 110% (one hundred and ten percent) three times of the estimated average monthly billingbilling or; (ii) b. for each subsequent Contract Year, equal to 110% (one hundred and ten percent) three times of the average of the monthly billing of the previous Contract Year. 10.4.3 11.6.3 Provided that the HPD GAP shall not draw upon such Letter of Credit prior to the Due Date of the relevant Monthly Monthly/Periodic Bill and/or Supplementary Bill, and shall not make more than one drawal in a Month. 10.4.4 11.6.4 Provided further that if at any time, such Letter of Credit amount falls short of the amount specified in Article 10.4.2 11.6.2 due to any reason whatsoever, the Buyer SECI shall restore such shortfall before next drawl. 10.4.5 The Buyer 11.6.5 SECI shall cause the scheduled bank issuing the Letter of Credit to intimate the HPDGAP, in writing regarding establishing of such irrevocable Letter of Credit. 10.4.6 The Buyer 11.6.6 SECI shall ensure that the Letter of Credit shall be renewed not later than its current expiry dateexpiry. 10.4.7 11.6.7 All costs relating to the opening and opening, maintenance of the Letter of Credit shall be borne by the BuyerSECI. 10.4.8 11.6.8 If the Buyer SECI fails to pay undisputed Monthly Monthly/Periodic Bill or Supplementary Bill or a part thereof within and including the Due Date, then, subject to Article 10.4.6 11.6.3 & 10.5.211.7.2, the HPD GAP may draw upon the Letter of Credit, and accordingly the bank shall pay, an amount equal to such Monthly Monthly/Periodic Bill or Supplementary Bill or part thereof, in accordance with Article 10.4.3 above, by presenting to the scheduled bank issuing the Letter of Credit, the following documents: (i) a copy of the Monthly Monthly/Periodic Bill or Supplementary Bill (only for energy related bills) which has remained unpaid to HPD GAP and; (ii) a certificate from the HPD GAP to the effect that the bill 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 Letter of Credit (LC). 10.4.1 The Buyer NVVN shall provide to the HPDBESSD, in respect of payment of its Monthly Bills and/or Supplementary Bills, a monthly standby unconditional, revolving and irrevocable letter of credit (“Letter of Credit”), opened and maintained which may be drawn upon by the HPD BESSD in accordance with this Article. 10.4.2 Before the start of supply, the Buyer NVVN shall, through a scheduled bank, open a Letter of Credit in favour of the HPDBESSD, 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 12 twelve (twelve12) Months and shall be renewed annually, for an amount equal to: (i) for the first Contract Year, equal to 110% (one hundred and ten percent) of the estimated average monthly billing; (ii) for each subsequent Contract Year, equal to 110% (one hundred and ten percent) of the average of the monthly billing of the previous Contract Year. 10.4.3 Provided that the HPD BESSD 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 drawl 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, the Buyer NVVN shall restore such shortfall before next drawl. 10.4.5 The Buyer NVVN shall cause the scheduled bank issuing the Letter of Credit to intimate the HPDBESSD, in writing regarding establishing of such irrevocable Letter of Credit. 10.4.6 The Buyer NVVN shall ensure that the Letter of Credit shall be renewed not later than its current expiry dateexpiry. 10.4.7 All costs relating to the opening and opening, maintenance of the Letter of Credit shall be borne by the BuyerNVVN. 10.4.8 If the Buyer NVVN fails to pay undisputed Monthly Bill or Supplementary Bill or a part thereof within and including the Due Date, then, subject to Article 10.4.6 & 10.5.2, the HPD BESSD 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, in accordance with Article 10.4.3 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 (only for energy related bills) which has remained unpaid to HPD BESSD and; (ii) a certificate from the HPD BESSD to the effect that the bill at item (i) above, or specified part thereof, is in accordance with the Agreement and has remained unpaid beyond the Due Date iii) Undertaking from the BESSD that the bill is not disputed by NVVN;