Common use of Redesignation of Letters of Credit Clause in Contracts

Redesignation of Letters of Credit. Each Loan Party may from time to time, in its sole discretion, but subject to the provisions of this Section, elect to redesignate as an Unsecured Letter of Credit a Letter of Credit which was initially issued as a Secured Letter of Credit issued for such Loan Party’s account. Such redesignation shall be accomplished by the delivery of written notice from such Loan Party to the Administrative Agent at least five (5) Business Days in advance of the date upon which such redesignation is requested to become effective, which notice shall identify the applicable Letter of Credit, shall certify that no Default has occurred and is continuing and shall contain such other information and be in such form as the Administrative Agent may reasonably request. The Administrative Agent shall give prompt notice of its receipt of any such request to the Lenders. The Administrative Agent, in reliance upon such request and certification shall (unless any Lender shall have notified the Administrative Agent in writing that a Default exists) release from the Collateral Account Eligible Collateral having in the aggregate Adjusted Fair Market Value equal or approximately equal to the amount of L/C Obligations associated with such Letter of Credit; provided, however, that in no event shall the Administrative Agent release Eligible Collateral to the extent that, after giving effect to such release, the Borrowing Base would be less than the amount of outstanding Secured L/C Obligations. From and after the date of such release, the applicable Letter of Credit shall be deemed to be an Unsecured Letter of Credit for all purposes hereof, including without limitation for purposes of determining the amount of the Letter of Credit Fee payable with respect thereto pursuant to Section 2.03(i).

Redesignation of Letters of Credit. Each Loan Party may from time to time, in its sole discretion, but subject to the provisions of this Section, elect to redesignate as an Unsecured Letter of Credit a Letter of Credit which was initially issued as a Secured Letter of Credit issued for such Loan Party’s account. Such redesignation shall be accomplished by the delivery of written notice from such Loan Party to the Administrative Agent at least five (5) Business Days in advance of the date upon which such redesignation is requested to become effective, which notice shall identify the applicable Letter of Credit, shall certify that no Default has occurred and is continuing and shall contain such other information and be in such form as the Administrative Agent may reasonably request. The Administrative Agent shall give prompt notice of its receipt of any such request to the Lenders. The Administrative Agent, in reliance upon such request and certification shall (unless any Lender shall have notified the Administrative Agent in writing that a Default exists) release from the Collateral Account Eligible Collateral having in the aggregate Adjusted Fair Market Value equal or approximately equal to the amount of L/C Obligations associated with such Letter of Credit; provided, however, that in no event shall the Administrative Agent release Eligible Collateral to the extent that, after giving effect to such release, the Borrowing Base would be less than the amount of outstanding Secured L/C Obligations. From and after the date of such release, the applicable Letter of Credit shall be deemed to be an Unsecured Letter of Credit for all purposes hereof, including without limitation for purposes of determining the amount of the Letter of Credit Fee payable with respect thereto pursuant to Section 2.03(i).. (m)