Common use of Credit Enhancements Clause in Contracts

Credit Enhancements. (a) Borrower and the Co-Borrowers have delivered to Lender a letter of credit (the "L/C") in the amount of $5,000,000 as additional security for the Loan. The L/C shall be maintained in form, substance and with an institution acceptable to Lender and shall be renewed automatically each year for an additional year during the term of the Loan (and notice of such renewal shall be delivered to Lender not later than thirty days prior to the expiration of the L/C being renewed). The issuing institution shall notify Lender at least thirty days prior to the end of any year that the L/C has not been renewed, and such notice of non-renewal (or the failure of Lender to receive timely notice of renewal) shall entitle Lender to draw upon the L/C and apply the proceeds to the repayment of the Loan. (b) Borrower will maintain, and will cause Sponsor to maintain, in good standing all credit enhancement documents delivered to Lender in connection with the Loan, including, without limitation the L/C, throughout the Term or such shorter period as Borrower and Lender may have agreed to in writing. Credit enhancement documents include any letters of credit, cash deposits, pledges, guarantees or indemnities delivered to Lender in connection with the Loan but excluding any letters of credit, promissory notes or cash deposits delivered to Lender as good faith or standby fees in connection with Lender's agreement to make the Loan. If the provider of any credit enhancement document becomes insolvent, commences or is the target of a Proceeding in bankruptcy or ceases to exist or if Lender determines that the provider's insolvency is imminent, Borrower will deliver or cause Sponsor to deliver, to Lender a replacement credit enhancement document within 5 Business Days of the date insolvency is known, the Proceeding in bankruptcy is filed, the cessation occurs or Lender gives Borrower notice that Lender has determined the provider's insolvency is imminent. The replacement credit enhancement document will be satisfactory to Lender from an alternate provider satisfactory to Lender. Upon receipt of the replacement, Lender will deliver promptly to Borrower the credit enhancement document being replaced.

Credit Enhancements. (a) On the terms and subject to the conditions contained in this Agreement, Lender agrees to provide one or more Credit Enhancements at the request of Borrower from time to time during the period commencing on the Effective Date and ending on the earlier of the Termination Date and 30 days prior to the Scheduled Termination Date; provided, however, that Lender shall not be under any obligation to provide any Credit Enhancement if: (i) the applicable conditions contained in Sections 3.1 and 3.2 are not then satisfied; (ii) after giving effect to the issuance of such Credit Enhancement, the aggregate principal amount of Loans outstanding would exceed the Loan Availability; (iii) Lender, in its sole discretion, is not satisfied with the relevant documentation proposed to evidence such Credit Enhancement; or (iv) the issuance of such Credit Enhancement shall have the effect of preventing the occurrence of an Event of Default under Section 9.1(g) or remedying any such Event of Default. (b) In no event shall the term of any Credit Enhancement be more than one year after the date of issuance thereof; provided, however, that any Credit Enhancement with a one-year term may provide for the renewal thereof for additional one-year periods. (c) In connection with the provision of each Credit Enhancement, Borrower shall give the Lender at least 10 days' prior written notice (a "Credit Enhancement Request"), in such written or electronic form as is acceptable to Lender, of the requested Credit Enhancement. Such notice shall describe in reasonable detail the purposes of such Credit Enhancement, the nature and amount of the underlying obligation, the proposed effective date of such requested Credit Enhancement (which day shall be a Business Day), the date on which such Credit Enhancement is to expire (which date shall be a Business Day), and the Co-Borrowers Person for whose benefit the requested Credit Enhancement is to be provided. (d) Subject to Section 2.2 and the satisfaction of the conditions set forth in this Section 2.4, Lender shall, on the requested date, provide a Credit Enhancement on behalf of Borrower. (i) Prior to the issuance of any Credit Enhancement by Lender, and as a condition of such issuance, Borrower shall have delivered to Lender a letter reimbursement agreement, in such form as Lender may require (each a "Reimbursement Agreement"), signed by Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of credit any conflict between the terms of any Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern. (ii) In addition to the Reimbursement Agreements contemplated by Section 2.4(e)(i), Borrower and Lender are parties to a Reimbursement Agreement effective as of January 1, 2004 (the "L/CUnivation Reimbursement Agreement") in pursuant to which Borrower has a reimbursement obligation (the amount of $5,000,000 as additional security "Univation Reimbursement Obligation") for any funds, services or other goods provided to Exxon Chemical Licensing Company, ExxonMobil Chemical Company, Union Carbide Subsidiary C, Inc. or Univation Technologies, LLC pursuant to the LoanUnivation Undertaking. The L/C shall be maintained in form, substance and with an institution acceptable to Lender and shall be renewed automatically each year for an additional year during Notwithstanding the term terms of the Loan (and notice of such renewal Univation Reimbursement Agreement, the Univation Undertaking shall not be delivered to Lender not later than thirty days prior to the expiration of the L/C being renewed). The issuing institution shall notify Lender at least thirty days prior to the end of any year that the L/C has not been renewed, and such notice of non-renewal (or the failure of Lender to receive timely notice of renewal) shall entitle Lender to draw upon the L/C and apply the proceeds to the repayment of the Loan. (b) Borrower will maintain, and will cause Sponsor to maintain, in good standing all credit enhancement documents delivered to Lender in connection with the Loantreated as a Credit Enhancement under this Agreement, including, without limitation limitation, for the L/Cpurposes of Section 2.10 (Fees). (f) At such time as Lender is required to advance funds, throughout services, or other items of value pursuant to any Credit Enhancement or the Term Univation Undertaking, such Credit Enhancement or used portion of the Univation Undertaking shall become a Reimbursement Obligation, and Borrower agrees to pay to Lender the amount of all Reimbursement Obligations on demand with interest thereon, irrespective of any claim, set-off, defense or other right which such Borrower may have at any time against Lender or any other Person. In the event that Lender makes any payment under any Credit Enhancement or the Univation Undertaking and Borrower shall not have repaid such amount to Lender pursuant to this clause (f) or such shorter period as payment is rescinded or set aside for any reason, such Reimbursement Obligation shall be payable on demand with interest thereon computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to past due Loans during such period, and then Lender shall, notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent Lender hereby irrevocably waives), be deemed to have made a Loan to Borrower in the principal amount of such unpaid Reimbursement Obligation. (g) Borrower's obligation to pay each Reimbursement Obligation shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of: (i) any lack of validity or enforceability of any Credit Enhancement or the Univation Undertaking or any Loan Document, or any term or provision therein; (ii) any amendment or waiver of or any consent to or departure from all or any of the provisions of any Credit Enhancement or the Univation Undertaking or any Loan Document (provided, that any such amendment shall have been approved in writing by Borrower if the effect of such amendment would have resulted in an increase in Borrower's applicable Credit Enhancement Obligations); (iii) the existence of any claim, right of set-off, defense or other right that Borrower or any of its Subsidiaries or other party guaranteeing, or otherwise obligated with, Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Credit Enhancement or the Univation Undertaking, Lender may have agreed to in writing. Credit enhancement documents include or any letters of creditother Person, cash deposits, pledges, guarantees or indemnities delivered to Lender whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction; (iv) any document presented under a Credit Enhancement or the Loan Univation Undertaking proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; (v) payment by Lender under a Credit Enhancement or the Univation Undertaking against presentation of a document that does not comply with the terms of such Credit Enhancement or the Univation Undertaking; and (vi) any other act or omission to act or delay of any kind of Lender or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but excluding any letters for the provisions of creditthis Section, promissory notes constitute a legal or cash deposits delivered equitable discharge of Borrower's obligations hereunder. Any action taken or omitted to be taken by Lender as good faith under or standby fees in connection with Lender's agreement to make any Credit Enhancement or the Loan. If Univation Undertaking shall not form the provider basis of any credit enhancement document becomes insolvent, commences resulting liability of Lender to Borrower. In determining whether documents presented under a Credit Enhancement or is the target of a Proceeding in bankruptcy or ceases to exist or if Lender determines that Univation Undertaking comply with the provider's insolvency is imminent, Borrower will deliver or cause Sponsor to deliver, to Lender a replacement credit enhancement document within 5 Business Days of the date insolvency is known, the Proceeding in bankruptcy is filed, the cessation occurs or Lender gives Borrower notice that Lender has determined the provider's insolvency is imminent. The replacement credit enhancement document will be satisfactory to Lender from an alternate provider satisfactory to Lender. Upon receipt of the replacementterms thereof, Lender will deliver promptly may accept documents that appear on their face to Borrower be in order, without responsibility for further investigation, regardless of any notice or information to the credit enhancement contrary and, in making any payment under any Credit Enhancement or the Univation Undertaking, Lender may rely exclusively on the documents presented to it under such Credit Enhancement or the Univation Undertaking as to any and all matters set forth therein, including reliance on the amount therein requested to be paid under such Credit Enhancement or the Univation Undertaking, whether or not the amount due to the beneficiary thereunder equals such amount and whether or not any document being replacedpresented pursuant to such Credit Enhancement or the Univation Undertaking proves to be insufficient in any respect, if such document on its face appears to be in order.

Credit Enhancements. (a) On the terms and subject to the conditions contained in this Agreement, Lender agrees to provide one or more Credit Enhancements at the request of Borrower from time to time during the period commencing on the Effective Date and ending on the earlier of the Termination Date and 30 days prior to the Scheduled Termination Date; provided, however, that Lender shall not be under any obligation to provide any Credit Enhancement if: (i) the applicable conditions contained in Sections 3.1 and 3.2 are not then satisfied; (ii) after giving effect to the issuance of such Credit Enhancement, the aggregate principal amount of Loans outstanding would exceed the Loan Availability; (iii) Lender, in its sole discretion, is not satisfied with the relevant documentation proposed to evidence such Credit Enhancement; or (iv) the issuance of such Credit Enhancement shall have the effect of preventing the occurrence of an Event of Default under Section 9.1(g) or remedying any such Event of Default. (b) In no event shall the term of any Credit Enhancement be more than one year after the date of issuance thereof; provided, however, that any Credit Enhancement with a one-year term may provide for the renewal thereof for additional one-year periods. (c) In connection with the provision of each Credit Enhancement, Borrower shall give the Lender at least 10 days' prior written notice (a "Credit Enhancement Request"), in such written or electronic form as is acceptable to Lender, of the requested Credit Enhancement. Such notice shall describe in reasonable detail the purposes of such Credit Enhancement, the nature and amount of the underlying obligation, the proposed effective date of such requested Credit Enhancement (which day shall be a Business Day), the date on which such Credit Enhancement is to expire (which date shall be a Business Day), and the Co-Borrowers Person for whose benefit the requested Credit Enhancement is to be provided. (d) Subject to Section 2.2 and the satisfaction of the conditions set forth in this Section 2.4, Lender shall, on the requested date, provide a Credit Enhancement on behalf of Borrower. (e) Prior to the issuance of any Credit Enhancement by Lender, and as a condition of such issuance, Borrower shall have delivered to Lender a letter reimbursement agreement, in such form as Lender may require (a "Reimbursement Agreement"), signed by Borrower, and such other documents or items as may be required pursuant to the terms thereof. In the event of credit any conflict between the terms of any Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern. (the "L/C"f) in Borrower agrees to pay to Lender the amount of $5,000,000 as additional security all Reimbursement Obligations owing to Lender on the Termination Date or such earlier date on which such amounts are due and payable under the relevant Reimbursement Agreement, irrespective of any claim, set-off, defense or other right which such Borrower may have at any time against Lender or any other Person. In the event that Lender makes any payment under any Credit Enhancement and Borrower shall not have repaid such amount to Lender pursuant to this clause (f) or such payment is rescinded or set aside for the Loan. The L/C any reason, such Reimbursement Obligation shall be maintained payable on demand with interest thereon computed from the date on which such Reimbursement Obligation arose to the date of repayment in formfull at the rate of interest applicable to past due Loans during such period, substance and with an institution acceptable then Lender shall, notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent Lender hereby irrevocably waives), be deemed to Lender have made a Loan to Borrower in the principal amount of such unpaid Reimbursement Obligation. (g) Borrower's obligation to pay each Reimbursement Obligation shall be absolute, unconditional and irrevocable, and shall be renewed automatically each year for an additional year during performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of: (i) any lack of validity or enforceability of any Credit Enhancement or any Loan Document, or any term or provision therein; (ii) any amendment or waiver of or any consent to or departure from all or any of the provisions of any Credit Enhancement or any Loan Document (and notice provided, that any such amendment shall have been approved in writing by Borrower if the effect of such renewal shall amendment would have resulted in an increase in Borrower's applicable Credit Enhancement Obligations); (iii) the existence of any claim, right of set-off, defense or other right that Borrower or any of its Subsidiaries or other party guaranteeing, or otherwise obligated with, Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Credit Enhancement, Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction; (iv) any document presented under a Credit Enhancement proving to be delivered forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; (v) payment by Lender under a Credit Enhancement against presentation of a document that does not comply with the terms of such Credit Enhancement; and (vi) any other act or omission to act or delay of any kind of Lender or any other Person or any other event or circumstance whatsoever, whether or not later than thirty days prior similar to the expiration any of the L/C being renewed)foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of Borrower's obligations hereunder. The issuing institution Any action taken or omitted to be taken by Lender under or in connection with any Credit Enhancement shall notify Lender at least thirty days prior to not form the end basis of any year that the L/C has not been renewed, and such notice of non-renewal (or the failure resulting liability of Lender to receive timely Borrower. In determining whether documents presented under a Credit Enhancement comply with the terms thereof, Lender may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice of renewal) shall entitle Lender to draw upon the L/C and apply the proceeds or information to the repayment of the Loan. (b) Borrower will maintain, and will cause Sponsor to maintaincontrary and, in good standing all credit enhancement documents delivered to Lender in connection with the Loanmaking any payment under any Credit Enhancement, including, without limitation the L/C, throughout the Term or such shorter period as Borrower and Lender may have agreed rely exclusively on the documents presented to it under such Credit Enhancement as to any and all matters set forth therein, including reliance on the amount therein requested to be paid under such Credit Enhancement, whether or not the amount due to the beneficiary thereunder equals such amount and whether or not any document presented pursuant to such Credit Enhancement proves to be insufficient in writing. Credit enhancement documents include any letters of creditrespect, cash deposits, pledges, guarantees or indemnities delivered if such document on its face appears to Lender be in connection with the Loan but excluding any letters of credit, promissory notes or cash deposits delivered to Lender as good faith or standby fees in connection with Lender's agreement to make the Loan. If the provider of any credit enhancement document becomes insolvent, commences or is the target of a Proceeding in bankruptcy or ceases to exist or if Lender determines that the provider's insolvency is imminent, Borrower will deliver or cause Sponsor to deliver, to Lender a replacement credit enhancement document within 5 Business Days of the date insolvency is known, the Proceeding in bankruptcy is filed, the cessation occurs or Lender gives Borrower notice that Lender has determined the provider's insolvency is imminent. The replacement credit enhancement document will be satisfactory to Lender from an alternate provider satisfactory to Lender. Upon receipt of the replacement, Lender will deliver promptly to Borrower the credit enhancement document being replacedorder.

Credit Enhancements. (a) On the terms and subject to the conditions contained in this Agreement, Lender agrees to provide one or more Credit Enhancements at the request of Borrower from time to time during the period commencing on the Effective Date and ending on the earlier of the Termination Date and 30 days prior to the Scheduled Termination Date; provided, however, that Lender shall not be under any obligation to provide any Credit Enhancement if: (i) the applicable conditions contained in Sections 3.1 and 3.2 are not then satisfied; (ii) after giving effect to the issuance of such Credit Enhancement, the aggregate principal amount of Loans outstanding would exceed the Loan Availability; (iii) Lender, in its sole discretion, is not satisfied with the relevant documentation proposed to evidence such Credit Enhancement; or (iv) the issuance of such Credit Enhancement shall have the effect of preventing the occurrence of an Event of Default under Section 9.1(g) or remedying any such Event of Default. (b) In no event shall the term of any Credit Enhancement be more than one year after the date of issuance thereof; provided, however, that any Credit Enhancement with a one-year term may provide for the renewal thereof for additional one-year periods. (c) In connection with the provision of each Credit Enhancement, Borrower shall give the Lender at least 10 days’ prior written notice (a “Credit Enhancement Request”), in such written or electronic form as is acceptable to Lender, of the requested Credit Enhancement. Such notice shall describe in reasonable detail the purposes of such Credit Enhancement, the nature and amount of the underlying obligation, the proposed effective date of such requested Credit Enhancement (which day shall be a Business Day), the date on which such Credit Enhancement is to expire (which date shall be a Business Day), and the Co-Borrowers Person for whose benefit the requested Credit Enhancement is to be provided. (d) Subject to Section 2.2 and the satisfaction of the conditions set forth in this Section 2.4, Lender shall, on the requested date, provide a Credit Enhancement on behalf of Borrower. (i) Prior to the issuance of any Credit Enhancement by Lender, and as a condition of such issuance, Borrower shall have delivered to Lender a letter of credit reimbursement agreement, in such form as Lender may require (the "L/C") in the amount of $5,000,000 as additional security for the Loan. The L/C shall be maintained in formeach a “Reimbursement Agreement”), substance and with an institution acceptable to Lender and shall be renewed automatically each year for an additional year during the term of the Loan (and notice of such renewal shall be delivered to Lender not later than thirty days prior to the expiration of the L/C being renewed). The issuing institution shall notify Lender at least thirty days prior to the end of any year that the L/C has not been renewedsigned by Borrower, and such notice of non-renewal (other documents or the failure of Lender to receive timely notice of renewal) shall entitle Lender to draw upon the L/C and apply the proceeds items as may be required pursuant to the repayment terms thereof. In the event of any conflict between the Loanterms of any Reimbursement Agreement and this Agreement, the terms of this Agreement shall govern. (bii) In addition to the Reimbursement Agreements contemplated by Section 2.4(e)(i), Borrower will maintainand Lender are parties to a Reimbursement Agreement effective as of January 1, and will cause Sponsor 2004 (the “Univation Reimbursement Agreement”) pursuant to maintainwhich Borrower has a reimbursement obligation (the “Univation Reimbursement Obligation”) for any funds, in good standing all credit enhancement documents delivered services or other goods provided to Lender in connection with Exxon Chemical Licensing Company, ExxonMobil Chemical Company, Union Carbide Subsidiary C, Inc. or Univation Technologies, LLC pursuant to the LoanUnivation Undertaking. Notwithstanding the terms of the Univation Reimbursement Agreement, the Univation Undertaking shall not be treated as a Credit Enhancement under this Agreement, including, without limitation limitation, for the L/Cpurposes of Section 2.10 (Fees). (f) At such time as Lender is required to advance funds, throughout services, or other items of value pursuant to any Credit Enhancement or the Term Univation Undertaking, such Credit Enhancement or used portion of the Univation Undertaking shall become a Reimbursement Obligation, and Borrower agrees to pay to Lender the amount of all Reimbursement Obligations on demand with interest thereon, irrespective of any claim, set-off, defense or other right which such Borrower may have at any time against Lender or any other Person. In the event that Lender makes any payment under any Credit Enhancement or the Univation Undertaking and Borrower shall not have repaid such amount to Lender pursuant to this clause (f) or such shorter period as payment is rescinded or set aside for any reason, such Reimbursement Obligation shall be payable on demand with interest thereon computed from the date on which such Reimbursement Obligation arose to the date of repayment in full at the rate of interest applicable to past due Loans during such period, and then Lender shall, notwithstanding whether or not the conditions precedent set forth in Section 3.2 shall have been satisfied (which conditions precedent Lender hereby irrevocably waives), be deemed to have made a Loan to Borrower in the principal amount of such unpaid Reimbursement Obligation. (g) Borrower’s obligation to pay each Reimbursement Obligation shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under any and all circumstances whatsoever, including the occurrence of any Default or Event of Default, and irrespective of: (i) any lack of validity or enforceability of any Credit Enhancement or the Univation Undertaking or any Loan Document, or any term or provision therein; (ii) any amendment or waiver of or any consent to or departure from all or any of the provisions of any Credit Enhancement or the Univation Undertaking or any Loan Document (provided, that any such amendment shall have been approved in writing by Borrower if the effect of such amendment would have resulted in an increase in Borrower’s applicable Credit Enhancement Obligations); (iii) the existence of any claim, right of set-off, defense or other right that Borrower or any of its Subsidiaries or other party guaranteeing, or otherwise obligated with, Borrower, any Subsidiary or other Affiliate thereof or any other Person may at any time have against the beneficiary under any Credit Enhancement or the Univation Undertaking, Lender may have agreed to in writing. Credit enhancement documents include or any letters of creditother Person, cash deposits, pledges, guarantees or indemnities delivered to Lender whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreement or transaction; (iv) any document presented under a Credit Enhancement or the Loan Univation Undertaking proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; (v) payment by Lender under a Credit Enhancement or the Univation Undertaking against presentation of a document that does not comply with the terms of such Credit Enhancement or the Univation Undertaking; and (vi) any other act or omission to act or delay of any kind of Lender or any other Person or any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but excluding any letters for the provisions of creditthis Section, promissory notes constitute a legal or cash deposits delivered equitable discharge of Borrower’s obligations hereunder. Any action taken or omitted to be taken by Lender as good faith under or standby fees in connection with Lender's agreement to make any Credit Enhancement or the Loan. If Univation Undertaking shall not form the provider basis of any credit enhancement document becomes insolvent, commences resulting liability of Lender to Borrower. In determining whether documents presented under a Credit Enhancement or is the target of a Proceeding in bankruptcy or ceases to exist or if Lender determines that Univation Undertaking comply with the provider's insolvency is imminent, Borrower will deliver or cause Sponsor to deliver, to Lender a replacement credit enhancement document within 5 Business Days of the date insolvency is known, the Proceeding in bankruptcy is filed, the cessation occurs or Lender gives Borrower notice that Lender has determined the provider's insolvency is imminent. The replacement credit enhancement document will be satisfactory to Lender from an alternate provider satisfactory to Lender. Upon receipt of the replacementterms thereof, Lender will deliver promptly may accept documents that appear on their face to Borrower be in order, without responsibility for further investigation, regardless of any notice or information to the credit enhancement contrary and, in making any payment under any Credit Enhancement or the Univation Undertaking, Lender may rely exclusively on the documents presented to it under such Credit Enhancement or the Univation Undertaking as to any and all matters set forth therein, including reliance on the amount therein requested to be paid under such Credit Enhancement or the Univation Undertaking, whether or not the amount due to the beneficiary thereunder equals such amount and whether or not any document being replacedpresented pursuant to such Credit Enhancement or the Univation Undertaking proves to be insufficient in any respect, if such document on its face appears to be in order.