• December 28, 2016

Burndown of a Security Deposit | Burndown of a Letter of Credit (“LOC”)

Sample Provision

Burndown of a Security Deposit | Burndown of a Letter of Credit (“LOC”)

Burndown of a Security Deposit | Burndown of a Letter of Credit (“LOC”) 800 450 Leasing REality | Commercial Real Estate Education

Pro-Landlord Language:

“Notwithstanding anything to the contrary contained in this Lease, and provided that this Lease is in full force and effect, Tenant shall have fully and timely paid all installments of Fixed Rent and Additional Rent, and Tenant shall not then (nor have been during the prior twenty four (24) month period) be in default of this Lease, then Tenant may provide to Landlord (and Landlord shall promptly thereafter execute and deliver to Tenant, if necessary) such instruments and authorizations, as may be reasonably required by the issuer of the Letter of Credit to reduce the face amount thereof by $80,000.00 to $240,000.00 as of the first (1st) day subsequent to the fifth (5th) anniversary of the Rent Commencement Date.”

Pro-Tenant Language:

“Notwithstanding anything to the contrary contained in this Lease, and provided that this Lease is in full force and effect and Tenant shall not then be in monetary or material nonmonetary default of this Lease (beyond the expiration of any applicable notice and cure period), then Tenant may provide to Landlord (and Landlord shall promptly thereafter execute and deliver to Tenant, if necessary) such instruments and authorizations, as may be reasonably required by the issuer of the Letter of Credit to reduce the face amount thereof by $80,000.00 to $240,000.00 as of the first (1st) day subsequent to the third (3rd) anniversary of the Rent Commencement Date.”