Performance Bond Letter of Credit Sample Template

When it comes to international trade or business contracts, a performance bond letter of credit (PBLC) serves as a crucial financial instrument. It guarantees that a party will fulfill its obligations outlined in a contract, assuring the other party of compensation in case of non-performance. Here's a sample template for a performance bond letter of credit in English:

Performance Bond Letter of Credit

[Issuing Bank Logo or Letterhead]

Date: [Date of Issuance]

To: [Name of Beneficiary]

Subject: Performance Bond Letter of Credit

Dear Sir/Madam,

This letter serves as confirmation that [Name of Applicant], hereinafter referred to as the "Applicant," has furnished a performance bond letter of credit (PBLC) in favor of [Name of Beneficiary], hereinafter referred to as the "Beneficiary," pursuant to contract [Contract Number] dated [Date of Contract], for the following project: [Project Description].

The performance bond letter of credit is issued for the amount of [Amount in Currency], and it shall remain valid until [Expiry Date]. This PBLC is subject to the Uniform Customs and Practice for Documentary Credits (UCP) latest edition.

In the event of the Applicant's failure to fulfill its contractual obligations, the Beneficiary shall be entitled to draw upon the performance bond letter of credit up to the specified amount without further inquiry. However, partial draws are permitted, and the total amount drawn shall not exceed the face value of this PBLC.

This performance bond letter of credit is transferable and assignable without the Applicant's consent. Any subsequent beneficiary must present this PBLC, along with the original beneficiary's written endorsement, to the issuing bank for validation.

This PBLC shall be governed by and construed in accordance with the laws of [Jurisdiction]. Any disputes arising out of or in connection with this PBLC shall be subject to the exclusive jurisdiction of the courts of [Jurisdiction].

This letter is issued at the request of the Applicant, and the issuing bank assumes no responsibility for the accuracy or completeness of the information provided herein.

Yours faithfully,

[Authorized Signatory]

[Title]

[Issuing Bank Name]

[Contact Information]

Disclaimer: This is a sample template for reference purposes only. Actual content may vary depending on the specific requirements and contractual agreements.