HomeMy WebLinkAboutA020 - Letter dated November 4, 2009 approving letter of credit with conditions Memo
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TO: Diane Voss, City Clerk
FROM: Doug Marek, City Attorney
DATE: November 4, 2009
SUBJECT: Letter of Credit for Southern Hills West
I am approving the Irrevocable Standby Letter of Credit(for landscaping at Southern Hills West) as to
form and legality. Please note that there are a number of conditions included in the LOC that may
require you to adjust your time lines for monitoring prior to expiration:
First, the LOC expires on May 14, 2010. The special instructions on the LOC require that copies of past
due invoices must accompany any draft, thereby indicating that the account is past due by no less than
fifteen days.
Second, the LOC is governed by new UCP 600, which requires a minimum of five calendar days for the
Issuer to review a draft for payment prior to determining whether to make or decline payment.
What this means is that any demand for payment by the City would have to be presented to Ames
Community Bank no later than May 9t', and it would have to be accompanied by past due invoices dated
no later than April 24t'.
Alternatlwehy;wetwould need a`replacernent:LOC by Apri or we could issue past due invoices by
April nffi-and accept a re lacement�.00 u until Ma 9"':
P P Y
Please let me know if you have any questions.
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