ISSUER
CANNOT ISSUE THE REQUESTED LETTER OF CREDIT DIRECTLY, BORROWER MAY REQUEST THAT
L/C ISSUER ARRANGE FOR THE ISSUANCE OF THE REQUESTED LETTER OF CREDIT UNDER A
RISK PARTICIPATION AGREEMENT WITH ANOTHER FINANCIAL INSTITUTION REASONABLY
ACCEPTABLE TO AGENT, L/C ISSUER AND BORROWER.
THE ISSUANCE OF ANY LETTER OF
CREDIT UNDER THIS AGREEMENT SHALL BE SUBJECT TO THE CONDITIONS THAT THE LETTER
OF CREDIT (I) SUPPORTS A TRANSACTION ENTERED INTO IN THE ORDINARY COURSE OF
BUSINESS OF BORROWER AND (II) IS IN A FORM, IS FOR AN AMOUNT AND CONTAINS SUCH
TERMS AND CONDITIONS AS ARE REASONABLY SATISFACTORY TO THE L/C ISSUER AND, IN
THE CASE OF STANDBY LETTERS OF CREDIT, AGENT.
THE INITIAL NOTICE REQUESTING
6
THE ISSUANCE OF A LETTER OF CREDIT SHALL BE ACCOMPANIED BY THE FORM OF THE
LETTER OF CREDIT AND THE MASTER STANDBY AGREEMENT OR MASTER DOCUMENTARY
AGREEMENT, AS APPLICABLE, AND AN APPLICATION FOR A LETTER OF CREDIT, IF ANY,
THEN REQUIRED BY THE L/C ISSUER COMPLETED IN A MANNER SATISFACTORY TO SUCH L/C
ISSUER.
IF ANY PROVISION OF ANY APPLICATION OR REIMBURSEMENT AGREEMENT IS
INCONSISTENT WITH THE TERMS OF THIS AGREEMENT, THEN THE PROVISIONS OF THIS
AGREEMENT, TO THE EXTENT OF SUCH INCONSISTENCY, SHALL CONTROL.
(IV)
EXPIRATION DATES OF LETTERS OF CREDIT.
THE
EXPIRATION DATE OF EACH LETTER OF CREDIT SHALL BE ON A DATE WHICH IS NOT LATER
THAN THE EARLIER OF (A) ONE YEAR FROM ITS DATE OF ISSUANCE OR (B) THE THIRTIETH
(30TH) DAY PRIOR TO THE DATE SET FORTH IN CLAUSE (A) OF THE DEFINITION OF THE
TERM COMMITMENT TERMINATION DATE. NOTWITHSTANDING THE FOREGOING, A LETTER OF
CREDIT MAY PROVIDE FOR AUTOMATIC EXTENSIONS OF ITS EXPIRATION DATE FOR ONE (1)
OR MORE SUCCESSIVE ONE (1) YEAR PERIODS PROVIDED THAT THE L/C ISSUER HAS THE
RIGHT TO TERMINATE SUCH LETTER OF CREDIT ON EACH SUCH ANNUAL EXPIRATION DATE AND
NO RENEWAL TERM MAY EXTEND THE TERM OF THE LETTER OF CREDIT TO A DATE THAT IS
LATER THAN THE THIRTIETH (30TH) DAY PRIOR TO THE DATE SET FORTH IN CLAUSE (A) OF
THE DEFINITION OF THE TERM COMMITMENT TERMINATION DATE.
THE L/C ISSUER MAY
ELECT NOT TO RENEW ANY SUCH LETTER OF CREDIT AND, UPON DIRECTION BY AGENT OR
REQUISITE LENDERS, SHALL NOT RENEW ANY SUCH LETTER OF CREDIT AT ANY TIME DURING
THE CONTINUANCE OF AN EVENT OF DEFAULT, PROVIDED THAT, IN THE CASE OF A
DIRECTION BY AGENT OR REQUISITE LENDERS, THE L/C ISSUER RECEIVES SUCH DIRECTIONS
PRIOR TO THE DATE NOTICE OF NON-RENEWAL IS REQUIRED TO BE GIVEN BY THE L/C
ISSUER AND THE L/C ISSUER HAS HAD A REASONABLE PERIOD OF TIME TO ACT ON SUCH
NOTICE.
(V)
OBLIGATIONS ABSOLUTE.
THE OBLIGATION OF
BORROWER TO REIMBURSE THE L/C ISSUER, AGENT AND LENDERS FOR PAYMENTS MADE IN
RESPECT OF LETTERS OF CREDIT ISSUED BY THE L/C ISSUER SHALL BE UNCONDITIONAL AND
IRREVOCABLE AND SHALL BE PAID UNDER ALL CIRCUMSTANCES STRICTLY IN ACCORDANCE
WITH THE TERMS OF THIS AGREEMENT, INCLUDING THE FOLLOWING CIRCUMSTANCES: (A) ANY
LACK OF VALIDITY