Common use of Reduction in Letter of Credit Clause in Contracts

Reduction in Letter of Credit. On the first (1st) anniversary of the Lease Commencement Date, provided no Event of Default has occurred, Landlord shall return to Tenant Two Hundred Thousand Dollars ($200,000.00), of the original One Million Dollar ($1,000,000.00), original Security Deposit (or, if the Security Deposit is in the form of a Letter of Credit, to permit Tenant to supply a substitute Letter of Credit in amount equal to Eight Hundred Thousand Dollars ($800,000.00). On the second (2nd) anniversary of the Lease Commencement Date, provided no Event of Default has occurred, Landlord shall return to Tenant an additional Two Hundred Thousand Dollars ($200,000.00) of the original One Million Dollar ($1,000,000.00), original Security Deposit (or, if the Security Deposit is in the form of a Letter of Credit, to permit Tenant to supply a substitute Letter of Credit in amount equal to Six Hundred Thousand Dollars ($600,000.00). On the third (3rd) anniversary of the Lease Commencement Date, provided no Event of Default has occurred, Landlord shall return to Tenant an additional Two Hundred Thousand Dollars ($200,000.00) of the original One Million Dollar ($1,000,000.00), original Security Deposit (or, if the Security Deposit is in the form of a Letter of Credit, to permit Tenant to supply a substitute Letter of Credit in amount equal to Four Hundred Thousand Dollars ($400,000.00). On the fourth (4th) anniversary of the Lease Commencement Date, provided no Event of Default has occurred, Landlord shall return to Tenant an additional Two Hundred Thousand Dollars ($200,000.00) of the original One Million Dollar ($1,000,000.00), original Security Deposit (or, if the Security Deposit is in the form of a Letter of Credit, to permit Tenant to supply a substitute Letter of Credit in amount equal to Two Hundred Thousand Dollars ($200,000.00). If the Letter of Credit is allowed to be reduced down to Two Hundred Thousand Dollars ($200,000) pursuant to this Section G, the Letter of Credit will be maintained in the full amount of Two Hundred Thousand Dollars ($200,000) for the remainder of the Term, and subject to all of the provisions of this Addendum #1. Upon any draw of the Letter of Credit, regardless of the then required amount of the Letter of Credit, Landlord and Tenant agree that the reduction contemplated herein shall be null and void, and Tenant shall immediately restore the Letter of Credit, or provide a new Letter of Credit, or provide cash or immediately available funds in the full amount of the original Security Deposit and Letter of Credit requirement of One Million Dollars ($1,000,000.00).