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  • September 10
  • 1:00 - 2:30 pm EST

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Letters of Credit: Their Great Utility; How To Draft and Draw on Them; and How To Avoid Common LC Problems, Pitfalls, and Mistakes

September 10

What the rules are that govern letters of credit, where to find them, and where and to whom to look to for advice concerning them.

Most attorneys and businesses do not regularly use, prepare or review letters of credit and/or think through various issues on how to draft them, what issuer to accept, what regime (ISP or UCP) to govern them or how to properly prepare to draw on them. Many do not even know how to prepare a draft, what the rules are that govern letters of credit, where to find them, and where and to whom to look to for advice concerning them.

Letter of credit law and practice is formal, strict and based on practices which differ in significant respects from the common law and contract principles. Yet with their instant liquidity and versatility, letters of credit, if properly drafted and used, are one of the most reliable and liquid payment assurance instruments available in this world of financial uncertainty. This topic will explain these issues so an attorney or business person can spot letter of credit issues, find out where to look for help and receive baseline guidance through the issues and problems commonly encountered in letter of credit practice.

Learning Objectives

- You will be able to identify the uses of and alternatives to letters of credit.

- You will be able to review where to look and who to ask for help on LC issues.

- You will be able to discuss choosing a credit-worthy issuer and dealing with issuer credit downgrades or refusals to extend.

- You will be able to explain how LCs can avoid bankruptcy issues.

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Agenda

LC Foundations, Rules, Features and Facts
  • Letter of Credit Facts - Who Issues Them and How Are They Priced?
  • Keys to LC Success Their Independence and Documentary Nature
  • Uses of Letters of Credit
  • Types - Commercial, Standby, Direct Pay Standby, Bank Guarantee, ICC/Swift BPO
  • Advantages and Disadvantages of LCs
  • Alternatives: Bank Guarantees, Export Insurance, Bonds, Collateral Arrangements and More
  • Common Problems, Pitfalls and Mistakes in Letter of Credit Practice and How to Avoid Them
Resources Where to Look
  • Counterintuitive and Sui Generis Nature of LCs
  • Laws and Rules That Govern LCs and LC Practice - The UCP, ISP, UCC, URDG and BPO
  • Where to Find the Rules, Source Materials, LC Forms and LC Consultants
  • ISP Model Forms of Standby Attached and Explained
LC Practice Pointers
  • Choosing a Credit-Worthy Issuer
  • Role of Advice, Confirmation, Negotiation of LCs
  • Issuer Credit Downgrade
  • Negotiating a Letter of Credit Application and Reimbursement Agreement
  • Benefits of Using the ISP vs. the UCP in Standbys
  • Avoiding Bankruptcy Issues
  • Drafting Draw Conditions (Triggers)
  • Avoiding Impossibility, Nondocumentary Conditions, Ambiguities
  • Automatic Extension Clauses
  • Commercial Letters of Credit
  • Drawing on an LC
  • Fax Presentments
  • Extend, Replace or Draw Provision
  • Force Majeure Events
  • Cancelling an LC
  • Transferring a Letter of Credit
  • Assigning Letter of Credit Proceeds
  • Taking Security Interests in LC Proceeds
  • Enjoining Draws on a Letter of Credit
  • Jurisdiction and Venue Issues
  • Attorneys' Fees
  • Supersedeas Letters of Credit
  • Letter of Credit Scams
  • Supersedeas (Appeal Bond) Letters of Credit
  • Fax Presentations
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Over 31 years and 1.4 million customers worth of experience providing continuing education. Our passion is providing you world-class training to help you succeed in business and as a professional.

Credits

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  • AL CLE 1.5
     
  • This course or a portion thereof has been approved by the Alabama State Mandatory Continuing Legal Education Commission for a maximum of 1.5 hours credit.
     
  • AR CLE 1.5
     
  • This course has been approved for 1.5 hours of CLE by the Arkansas CLE Board.
     
  • Arizona CLE 1.5
     
  • The State Bar of Arizona does not approve or accredit CLE activities for the Mandatory Continuing Legal Education requirement. This activity may qualify for up to 1.5 hours toward your annual CLE requirement for the State Bar of Arizona.
     
  • CA MCLE 1.5
     
  • Lorman Business Center, Inc. is a State Bar of California approved MCLE sponsor and this course qualifies for 1.5 CLE hours of participatory credit.
     
  • CO CLE 2.0
     
  • This program may qualify for 2.0 credit hours through the Colorado Supreme Court Board of Continuing Legal and Judicial Education through reciprocity. This course is accredited in other jurisdictions such as New Jersey. To receive CLE credit for this program, a home study affidavit must be submitted to the Supreme Court Board of Continuing Legal and Judicial Education.
     
  • CT CLE 1.5
     
  • Neither the Connecticut Judicial Branch nor the Commission on Minimum Continuing Legal Education approve or accredit CLE providers or activities. This course has been approved for CLE credit in jurisdictions aside from CT and therefore it automatically meets the content and delivery requirements in Connecticut. Credit is based on a 60 minute credit hour and shall be awarded as follows: 1.5 CLE credit(s).
     
  • GA CLE 1.5
     
  • This program has been approved by the Georgia Commission on Continuing Lawyer Competency for 1.5 CLE hours.
     
  • HI CLE 1.5
     
  • This program was approved by the Hawaii State Board of Continuing Legal Education for 1.5 CLE credit hours.
     
  • IL CLE 1.5
     
  • This course was approved for a total of 1.5 hours of MCLE Credit by the Illinois MCLE Board.
     
  • ME CLE 1.5
     
  • This course has been approved by the State of Maine Board of Overseers of the Bar. Lawyers who complete this course shall receive 1.5 hours of CLE credit under M. Bar R. 12.
     
  • MS CLE 1.5
     
  • This program has been approved by the Mississippi Commission on Continuing Legal Education for a maximum of 1.5 credit hours.
     
  • MT CLE 1.5
     
  • This program has been approved by the Montana Commission of Continuing Legal Education for a total of 1.5 CLE credits.
     
  • NH MCLE 1.5
     
  • NH MCLE does not approve or accredit CLE activities for the NH Minimum CLE requirement. Lorman Education Services believes this course meets the requirement of NH Supreme Court Rule 53 and may qualify for CLE credit(s). Program Length: 90 Minutes.
     
  • NJ CLE 1.8
     
  • This program has been approved by the Board on Continuing Legal Education of the Supreme Court of New Jersey for 1.8 hours of total CLE credit.
     
  • NV CLE 1.5
     
  • This program has been approved by the Nevada Board of Continuing Legal Education for 1.5 CLE hours.
     
  • NY CLE 1.5 including Areas of Professional Practice 1.5
     
  • This course has been approved in accordance with the requirements of the New York Continuing Legal Education Board for up to a maximum of 1.5 credit hours in the area(s) of Areas of Professional Practice for 1.50 hours. Each hour may be counted only as satisfying one category of credit. Duplicate credit for the same hour of instruction is not permitted. This course qualifies for both established and newly admitted attorneys. Lorman Business Center, Inc. has a financial hardship guideline. Please contact customer service at 1.866.352.9539 for instructions on how to apply.
     
  • PA CLE 1.5
     
  • This Distance Learning program has been approved by the Pennsylvania Continuing Legal Education Board for 1.5 hours of substantive law, practice and procedure CLE credit.
     
  • RI CLE 1.5
     
  • This program has been approved by the Rhode Island Mandatory Continuing Legal Education Commission for 1.5 hours of CLE credit.
     
  • TN CLE 1.5
     
  • This program has been approved as a distance learning format by the Tennessee Commission on Continuing Legal Education for a maximum of 1.5 hours of credit.
     
  • VT CLE 1.5
     
  • This program has been approved by the Mandatory Continuing Legal Education Board of Vermont for 1.5 hours of CLE credit.
     
  • WA CLE 1.5
     
  • This program has been approved by the Washington State Board of Continuing Legal Education for 1.5 hours of Law & Legal Procedure credit.
     
  • WI CLE 1.5
     
  • This program has been approved by the Board of Bar Examiners for 1.5 hours for use toward the Wisconsin Mandatory CLE requirement.
     
  • WV MCLE 1.8
     
  • This program has been approved by the West Virginia State Bar MCLE Commission for 1.8 MCLE hours.
     
  • CPE 1.8 including Specialized Knowledge 1.8
     
  • Lorman Education Services is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its web site: https://www.nasbaregistry.org/cpas/complaints. For more information regarding administrative policies such as complaint and refund, please contact our offices at 866-352-9539. CPE Credit: Maximum Credit Hours: 1.8 each session (based on a 50 minute credit hour). You must attend at least 50 minutes to obtain credit. Field of Study: Specialized Knowledge for 1.8 hours. Prerequisite: . Level of Knowledge: Intermediate. Teaching Method: Seminar/Lecture. Advance Preparation: None. Delivery Method: Group Internet Based. Please refer to the information in this brochure for outline, course content and objectives. Upon completion of this course, you will receive a certificate of attendance. Final approval of a course for CPE credit belongs with each state's regulatory board. Please note: In order to receive CPE credit for this course you MUST use the streaming audio option, as well as enable and complete the required progress checks.
     
  • Lorman Business Center, Inc. is a registered provider for CPA CPE through the State Education Department of New York, Sponsor number: 000640. The following course will carry the subject area of Specialized Knowledge and Applications for 1.5 hours.
     

Audio & Reference Manual

This program does NOT qualify, nor meet the National Standard for NASBA accreditation.

Who should attend?

This live webinar is designed for attorneys, credit and collection managers, presidents, vice presidents, business owners and managers, lending professionals and accountants.

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Why Lorman?

Over 31 years and 1.4 million customers worth of experience providing continuing education. Our passion is providing you world-class training to help you succeed in business and as a professional.

Faculty

Carter H. Klein

Carter H. Klein

Jenner & Block LLP

  • Partner in Jenner & Block LLP's Chicago office
  • Concentrated his practice on Uniform Commercial Code work, secured and unsecured lending and payments for the past 43 years at Jenner & Block LLP
  • Extensive experience with Article 5 of the Uniform Commercial Code – Letters of Credit
  • ABA UCC Liaison to the Permanent Editorial board of the Uniform Commercial Code
  • Former Chair of both the Letter of Credit Subcommittee and Payments Sub-committee of the ABA
  • Co-wrote three books on the Uniform Commercial Code
  • Honored as Letter of Credit Attorney of the Year in 2018 by the Institute of International Banking Law & Practice
  • J.D. degree, Order of the Coif, First in Class, University of Illinois College of Law; B.A. degree, with the highest distinction, University of Illinois at Urbana-Champagne
  • Can be contacted at 312-923-2950 or [email protected]
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Product ID: 404072
Published 2016, 2018
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