3100
HOUSTON, TEXAS 77002
FACSIMILE:
ATTN:
APPLICANT AND ACCOUNT PARTY:
BECHTEL OIL, GAS AND CHEMICALS, INC.
3000 POST OAK BOULEVARD
HOUSTON, TEXAS 77056
FACSIMILE: ***
ATTN: [
]
WE HEREBY ISSUE OUR IRREVOCABLE STANDBY LETTER OF CREDIT NO. __________ (THIS
"LETTER OF CREDIT") IN FAVOR OF DRIFTWOOD LNG LLC, AS BENEFICIARY, FOR AN
INITIAL AMOUNT OF __[10% of Contract Price]____________ U.S. DOLLARS
($_____________) (THE "STATED AMOUNT") AT THE REQUEST AND FOR THE ACCOUNT OF
BECHTEL OIL, GAS AND CHEMICALS, INC., AS APPLICANT.
WE ARE INFORMED THAT THIS LETTER OF CREDIT IS ISSUED ON BEHALF OF THE APPLICANT
TO SUPPORT APPLICANT'S OBLIGATIONS UNDER THAT CERTAIN LUMP SUM TURNKEY AGREEMENT
FOR THE ENGINEERING, PROCUREMENT AND CONSTRUCTION OF DRIFTWOOD LNG PHASE 4
LIQUEFACTION FACILITY, DATED AS OF [
, 20
], BY AND BETWEEN
APPLICANT AND BENEFICIARY (AS AMENDED, RESTATED, SUPPLEMENTED OR OTHERWISE
MODIFIED FROM TIME TO TIME, THE "AGREEMENT").
FUNDS UNDER THIS LETTER OF CREDIT ARE AVAILABLE BY PAYMENT AGAINST THE
PRESENTATION OF YOUR DRAFT(S) DRAWN AT SIGHT ON [INSERT ISSUING BANK'S NAME AND
ADDRESS] (THE "ISSUING BANK") IN THE FORM OF ANNEX I ATTACHED HERETO AND
ACCOMPANIED BY A DRAWING CERTIFICATE DULY SIGNED IN THE FORM OF ANNEX II OR
ANNEX VI ATTACHED HERETO APPROPRIATELY COMPLETED. DOCUMENTS MUST BE PRESENTED TO
ISSUING BANK IN ONE LOT.
PARTIAL DRAWINGS ARE PERMITTED. ALL BANKING CHARGES UNDER THIS LETTER OF CREDIT
ARE FOR ACCOUNT OF THE APPLICANT.
THIS LETTER OF CREDIT IS TRANSFERABLE IN ITS ENTIRETY AND NOT IN PART, UPON
NOTICE BY BENEFICIARY TO ISSUER, IN THE FORM OF ANNEX III ATTACHED HERETO
APPROPRIATELY COMPLETED; PROVIDED, HOWEVER, THAT THIS LETTER OF CREDIT MAY NOT
BE TRANSFERRED TO ANY PERSON IF SUCH TRANSFER TO, OR DRAWING UNDER THIS LETTER
OF CREDIT BY, SUCH PERSON WOULD BE PROHIBITED OR BLOCKED UNDER ANY U.S.
EXECUTIVE ORDER, LAW OR ANY RULE OR REGULATION OF THE OFFICE OF FOREIGN ASSETS
CONTROL OF THE U.S. TREASURY DEPARTMENT OR THE U.S. COMMERCE DEPARTMENT, AND ANY
ATTEMPTED TRANSFER WHICH VIOLATES THIS PROVISION SHALL BE NULL AND VOID.
18-1
Execution Copy
Phase 4
THE STATED AMOUNT SHALL BE AUTOMATICALLY AND PERMANENTLY REDUCED BY THE AMOUNT
OF ANY DRAWING RECEIVED BY BENEFICIARY PURSUANT TO THIS LETTER OF CREDIT [INSERT
ENTIRE LETTER OF CREDIT REFERENCE, ALL NUMBERS AND LETTERS].
THE STATED AMOUNT OF THIS LETTER OF CREDIT SHALL DECREASE TO AN AGGREGATE AMOUNT
OF ____[4% of Contract Price]______ U.S. DOLLARS ($_________________) AFTER
ISSUING BANK'S RECEIPT FROM BENEFICIARY OF WRITTEN NOTICE THAT (A) SUBSTANTIAL
COMPLETION OF PROJECT 5 HAS OCCURRED, (B) CONTRACTOR HAS PAID ALL DELAY
LIQUIDATED DAMAGES OWED FOR PROJECT 5, AND (C) CONTRACTOR HAS ACHIEVED THE
PERFORMANCE GUARANTEE FOR PROJECT 5 OR PAID ALL PERFORMANCE LIQUIDATED DAMAGES
FOR PROJECT 5, WHICH SHALL BE IN THE FORM OF ANNEX IV ATTACHED HERETO
APPROPRIATELY COMPLETED.
THE STATED AMOUNT OF THIS LETTER OF CREDIT SHALL DECREASE TO AN AGGREGATE AMOUNT
OF ZERO U.S. DOLLARS (U.S.$0) AFTER ISSUING BANK'S RECEIPT FROM BENEFICIARY
WRITTEN NOTICE OF THE EXPIRATION OF THE DEFECT CORRECTION PERIOD FOR PROJECT 5,
WHICH