Green Clause

Green Clause

A clause in a letter of credit allowing one to take out an advance loan before a shipment is sent if one puts up some collateral, often demonstrated by warehouse receipts. For example, a farmer may utilize a green clause to receive financing for operations, using his crops in a warehouse as collateral. A green clause is most common in contracts relating to agricultural commodities.
References in periodicals archive ?
Furthermore, investors may seek penalties for a green default, whereby a bond is paid in full but the issuer breaks agreed green clauses.
By signing "green clauses" MAF encourages tenants to adopt environmentally friendly procedures and even awards "green star" ratings to environmentally efficient ones.
We are also seeing specific green clauses appearing in tenders for government departments.
MAF engages in active dialogue with its tenants in order to reduce energy waste in their stores and encourage environmentally friendly procedures such as tenants signing "green clauses".