                                 CODE OF VIRGINIA

&#8220;LETTER OF CREDIT&#8221; TERM; &#8220;CONFIRMED CREDIT.&#8221; (§
8.2-325)

1. Failure of the buyer seasonably to furnish an agreed letter of credit is a
breach of the contract for sale.

2. The delivery to seller of a proper letter of credit suspends the
buyer&#8217;s obligation to pay. If the letter of credit is dishonored, the
seller may on seasonable notification to the buyer require payment directly from
him.

3. Unless otherwise agreed the term &#8220;letter of credit&#8221; or
&#8220;banker&#8217;s credit&#8221; in a contract for sale means an irrevocable
credit issued by a financing agency of good repute and, where the shipment is
overseas, of good international repute. The term &#8220;confirmed credit&#8221;
means that the credit must also carry the direct obligation of such an agency
which does business in the seller&#8217;s financial market.

HISTORY: 1964, c. 219.