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The Cash Collateral Letter of Credit is a crucial instrument in international trade and banking transactions, particularly when parties require enhanced security arrangements. This document type is commonly used in Switzerland, leveraging the country's sophisticated banking infrastructure and robust legal framework. The arrangement involves an applicant providing cash collateral to secure a bank's issuance of a Letter of Credit, offering the beneficiary a high level of payment assurance. The document addresses key aspects including collateral management, drawing conditions, bank's rights, and applicant's obligations, all within the context of Swiss law. It's particularly relevant when parties seek to minimize credit risk while maintaining compliance with Swiss banking regulations and international banking practices.

1. Parties: Identification of all parties including the issuing bank, applicant providing cash collateral, and beneficiary

2. Background: Context of the transaction and purpose of the Letter of Credit arrangement

3. Definitions: Key terms used throughout the document including banking, collateral, and LC-specific terminology

4. Letter of Credit Terms: Core terms of the LC including amount, validity period, and conditions for drawing

5. Cash Collateral Provisions: Details of the cash collateral arrangement including amount, currency, and maintenance requirements

6. Security Interest: Declaration and terms of the bank's security interest over the cash collateral

7. Drawing Conditions: Specific conditions and documentation required for drawing under the LC

8. Bank's Rights and Obligations: Detailed outline of the issuing bank's rights and responsibilities

9. Applicant's Obligations: Commitments and responsibilities of the applicant providing the cash collateral

10. Fees and Charges: All applicable fees, charges, and commission structures

11. Representations and Warranties: Standard declarations about capacity, authority, and compliance

12. Events of Default: Circumstances constituting default and consequent remedies

13. Governing Law and Jurisdiction: Confirmation of Swiss law governance and jurisdiction details