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Performance Standby Letter Of Credit Template for New Zealand

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Key Requirements PROMPT example:

Performance Standby Letter Of Credit

"I need a Performance Standby Letter of Credit for NZD 5 million to be issued by ANZ Bank New Zealand in favor of Wellington City Council, guaranteeing our company's performance in constructing a new municipal building, with the letter to be valid until March 15, 2025."

Document background
The Performance Standby Letter of Credit is a crucial financial instrument in New Zealand's commercial landscape, particularly utilized in situations where parties seek assurance of performance in significant commercial transactions. This document type is commonly employed when one party requires a bank's guarantee of the other party's performance obligations. The Performance Standby Letter of Credit, governed by New Zealand law, provides a mechanism for the beneficiary to claim payment from the issuing bank upon documented evidence of the applicant's failure to perform specified obligations. It includes detailed terms regarding the conditions for drawing, required documentation, expiry dates, and compliance requirements under New Zealand banking regulations and international banking practices. This instrument is particularly valuable in international trade, large-scale construction projects, and complex commercial transactions where performance security is essential.
Suggested Sections

1. Issuing Bank Details: Full name and contact details of the issuing bank

2. Letter of Credit Number: Unique identification number for the SBLC

3. Date of Issuance: Date when the SBLC becomes effective

4. Beneficiary Details: Complete details of the party in whose favor the SBLC is issued

5. Applicant Details: Complete details of the party requesting the SBLC

6. Currency and Amount: Specification of the currency and maximum amount available under the SBLC

7. Expiry Date: Date when the SBLC expires and can no longer be drawn upon

8. Performance Obligations: Clear description of the underlying performance obligations being guaranteed

9. Drawing Conditions: Specific conditions and documentation required for drawing under the SBLC

10. Presentation Location: Where and how documents must be presented for drawing

11. Governing Law Declaration: Statement that the SBLC is governed by New Zealand law

12. Authorization: Authorized signatures and bank authentication details

Optional Sections

1. Partial Drawings Clause: Include when partial drawings are to be permitted under the SBLC

2. Transfer Provisions: Include when the SBLC needs to be transferable to other beneficiaries

3. Counter Guarantee References: Include when there is a counter-guarantee from another bank involved

4. Force Majeure Clause: Include when specific force majeure provisions are required beyond standard bank practice

5. Amendment Procedures: Include when specific procedures for amendments need to be detailed

6. Assignment Provisions: Include when rights under the SBLC may be assigned

7. Multiple Currency Provisions: Include when drawings may be made in multiple currencies

Suggested Schedules

1. Drawing Certificate Template: Standard form for beneficiary to complete when making a drawing

2. Performance Default Notice Template: Template for notifying default in the underlying performance obligations

3. Required Documents Checklist: Detailed list of all documents required for drawing under the SBLC

4. Underlying Contract Summary: Summary of the key terms of the contract being guaranteed

5. Bank Contact Details: Complete contact information for all relevant bank departments

6. Fee Schedule: Schedule of all applicable fees and charges

7. Authentication Procedures: Detailed procedures for authenticating drawing requests and documents

Authors

Alex Denne

Head of Growth (Open Source Law) @ ºÚÁÏÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions

































Clauses






























Relevant Industries

Banking and Financial Services

International Trade

Construction and Infrastructure

Manufacturing

Energy and Resources

Telecommunications

Maritime and Shipping

Mining

Engineering Services

Real Estate Development

Government and Public Sector

Utilities

Relevant Teams

Legal

Finance

Treasury

Trade Finance

Risk Management

Compliance

Commercial Operations

Banking Operations

International Trade

Credit Administration

Project Finance

Documentary Credits

Relevant Roles

Trade Finance Manager

Corporate Banking Officer

International Trade Specialist

Credit Risk Manager

Commercial Banking Manager

Project Finance Manager

Treasury Manager

Contract Administrator

Legal Counsel

Chief Financial Officer

Procurement Manager

Commercial Director

Banking Operations Manager

Documentary Credits Specialist

Compliance Officer

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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