ASSIGNMENT OF PROCEEDS

A document transferring all or part of the proceeds from a letter of credit to a third party beneficiary. To receive an assignment of proceeds, the beneficiary of a letter of credit is required to submit, in writing, a request to the bank to assign the funds to a different person or company.

Once approved, the bank will disperse the funds accordingly, pending the fulfillment of any requirements set forth in the letter of credit. However, if the principal party does not meet the obligations outlined in the letter of credit, no assignment will take place.