Credit Letter, Sample & Format

Credit LetterA Credit letter is issued by a financial agency or institution which acts as a mediator between two parties in a business transaction, functioning to safeguard the integrity of the parties involved in purchasing and selling transactions. The seller has to agree to the stated terms listed in letter of credit. The financial agency or institution represents the purchaser who promises to return full payment of any goods owed.

From:

United Central Bank,

224 McDonald Street
Ottawa, ON K1P 5M7

February 13, 2011

Beneficiary:

Bolton Engineering Corporation

1900 Justice Street
Ottawa, ON K1P 5M7

Gentlemen,

Re: Irrevocable Letter of Credit No#: B323394

Gentlemen:

We hereby open this irrevocable credit in your favor for the sum of Eighty thousand dollars ($80,000), which will be available through your request for the purpose of payment on sight of your draft presentation with the following statement:

‘Bolton Engineering Corporation has a right to the amount drawn according to the terms and conditions of as per Agreement by the exporter.’

This Letter of Credit is valid until May 15, 2013, which will be automatically extended without amendment for another two years from the present or any future expiration date thereof. Unless the Issuing Bank issues a written notice of not less than thirty days (30) days before the expiry date to Bolton Engineering Corporation.  The notice required below is deemed to be served upon your receipt.

This Letter of Credit issued is in accordance with the Standard Customs and Practice for Documentary Credits, 2008 Version National Chamber of Commerce Publication No. 400

Sincerely yours,

United Central Bank

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