The form for the letter of credit under this chapter shall be:

Effective Date

State of Minnesota (Beneficiary)

(Address)

Dear Sirs:

By order of ………………..(Self-Insurer) we are instructed to open a clean irrevocable Letter of Credit in your favor for United States $……………..(Amount).

We undertake that drawings under this Letter of Credit will be honored upon presentation of your draft drawn on ……………(issuing bank), at ……………(Address) prior to expiration date.

The Letter of Credit expires on ……………, but will automatically extend for an additional one year if you have not received by registered mail notification of intention not to renew 60 days prior to the original expiration date and each subsequent expiration date.

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Terms Used In Minnesota Statutes 79A.14

  • Clean: means a letter of credit that is not conditioned on the delivery of any other documents or materials. See Minnesota Statutes 79A.04
  • Irrevocable: means a letter of credit that cannot be modified or revoked without the consent of the beneficiary, once the beneficiary is established. See Minnesota Statutes 79A.04
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.

Except as expressly stated herein, this undertaking is not subject to any condition or qualification. The obligation of ……………..(issuing bank) under this letter of credit shall be the individual obligation of ……………..(issuing bank), in no way contingent upon reimbursement with respect thereto.

Very truly yours,

. (Signature)