KYTC_RFP 4_Attachment 10_Example Letter of Credit_v10_20260428.pdf
PDF 168 KB Posted
- Attached to
- Electric Vehicle Charging Program RFP 4
- Solicitation number
- RFP 605 2600000371 3
- Issued by
- Kentucky
About this file
This is an example irrevocable letter of credit template document prepared by the Kentucky Transportation Cabinet (KYTC) for use in state contract opportunities. The letter of credit serves as a financial security instrument and must be issued by a bank on behalf of a proposer to guarantee performance under a project agreement with KYTC. The template establishes the framework for the letter of credit structure, including provisions for sight payment drafts, automatic renewal provisions, partial and multiple drawings, and specific conditions under which the beneficiary (KYTC) may draw funds due to an event of default under the underlying project agreement.
The letter of credit must remain valid through the contract term with automatic one-year renewal periods unless the issuing bank provides written notice of non-renewal at least sixty days prior to expiration. Drawings may be made by KYTC upon presentation of a signed certification confirming an uncured event of default and specifying the amount due. The template permits partial draws, which correspondingly reduce the available credit amount, and requires return of the original letter of credit to KYTC with notation of partial payments. The letter of credit may only be reduced by mutual written agreement between the proposer and beneficiary. Drafts must be presented to the issuing bank within three banking days of receipt and may be delivered in person, by mail, or courier service. The document includes standard banking language regarding wire instructions and payment processing procedures.
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Attachment 10 – Example Irrevocable Letter of Credit
Attachment 10 – Example Irrevocable Letter Of Credit
Letter of Credit Number: [Letter Number]
Issue Date: [Date]
Dollar Amount: [Dollar Amount]
Issuing Bank: [Bank Name and Address]
Proposer: [Proposer Name and Address]
Beneficiary: Kentucky Transportation Cabinet
200 Mero Street Frankfort, KY 40622
We hereby establish our Irrevocable Letter of Credit in the dollar amount indicated above available with us at our above office by sight payment and authorize you to draw at sight on [Bank Name] drafts on us accompanied by a signed certification (purportedly certified by an authorized signatory of the Kentucky Transportation Cabinet (“Beneficiary”) in the following form:
“We are drawing under [Bank Name] Letter of Credit Number [Letter Number] because:
(i) an Event of Default has occurred and has continued as defined in the Project Agreement [Contract Numbers] by and between [Proposer Name] and the Beneficiary dated [Contract Award Date]; (ii) such Event of Default has not been cured or waived within the cure period provided in the Project Agreement; and (iii) the amount demanded represents funds due and owing to the Beneficiary.”
This Letter of Credit expires at our above office on [Expiration Date (Month/Day/Year)], but shall be automatically extended, without written amendment for one year periods to [Extension Date (Month/Day)] in each succeeding calendar year unless we have sent written notice to you, at least sixty
(60) calendar days prior to any such expiration date, by registered mail or express courier that we elect not to renew this Letter of Credit beyond the date specified in such notice.
Each draft must also be accompanied by the original of this Letter of Credit for our endorsement on this Letter of Credit of our payment of such draft.
Each draft must be marked “Drawn under [Bank Name] Letter of Credit Number [Letter Number].”
If any instructions accompanying a drawing under this Letter of Credit request that payment is to be made by transfer to an account with us or at another bank, we and/or such other bank may rely on an account number and wire instructions specified in such instructions, even if the number identifies a person or entity different from the intended payee.
As used herein, the term “Business Day” shall mean a day of the year on which our [Branch Office Name] office is open for business.
Attachment 10 – Example Irrevocable Letter of Credit
We hereby agree with drawers that drafts as specified above will be duly honored upon presentation to [Bank Name] at the address indicated above if presented in person, by mail, or by courier service on or before [One Year], or any expiration date as provided herein, within three (3) banking days of receipt by [Bank Name].
Partial and multiple drawings are permitted under this Letter of Credit, [Bank Name]’s honor of a partial draw shall correspondingly reduce the amount of credit available under this Letter of Credit. Following a partial draw, [Bank Name] shall return this original Letter of Credit to the Kentucky Transportation Cabinet with the partial draw noted thereon unless such partial draw results in payment up to the total amount available under the Letter of Credit.
This Letter of Credit may be reduced by amendment requested by [Proposer Name] (“Proposer”) and agreed in writing by the Beneficiary.
[FOR Bank Name]
Signature
Typed Name and Title
Attachment 10 – Example Irrevocable Letter Of Credit
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