Common use of Performance Assurances Clause in Contracts

Performance Assurances. (1) Should the creditworthiness, financial strength, or performance viability of a Party (the “Second Party”) become unsatisfactory to the other Party (the “Requesting Party”) in such Requesting Party’s commercially reasonably exercised discretion with regard to any transaction pursuant to this Agreement, the Requesting Party may require the Second Party to post or provide at the Second Party’s option: (a) a Letter of Credit; (b) other collateral or security by the Second Party that is acceptable to the Requesting Party in its commercially reasonably exercised discretion; (c) a Guarantee Agreement; or (d) some other mutually agreeable method of satisfying the Requesting Party (the items described in (a) through (d) are referred to as “Performance Assurance”). The Requesting Party may only request, and the Second Party shall only be required to provide, Performance Assurance in a commercially reasonable amount under the circumstances, and in any event, in a total amount up to the sum of the following: (i) the amount, if any, billed to and outstanding from the Second Party as of the date of such request, plus (ii) the amounts projected to be due and owing from the Second Party on the weekly invoice payment dates under Section 6.6 that fall within the 15 calendar day period following the date of such request (with such projection to be calculated by the Requesting Party, acting reasonably pursuant to this Agreement). The Second Party may request from the Requesting Party that the Performance Assurance be returned or reduced, on the condition that such a request shall only be made once every sixty (60) days during any period when a Performance Assurance has been provided. The Requesting Party shall be required to return or reduce the Performance Assurance, after receipt of the request from the Second Party, if, reasonably considering whether the factors that justified the Requesting Party’s request for Performance Assurance have been removed or improved, it is commercially reasonable to do so. (2) Events which may cause the Requesting Party to conclude the Second Party’s creditworthiness, financial strength, or performance viability have become unsatisfactory as set out in Section 15.2(1) above, include, but are not limited to, any of the following: (a) The Requesting Party having knowledge that the Second Party (or its Credit Support Provider, if applicable) is failing to perform or defaulting under material terms of other material contracts; or (b) Other material adverse changes in the Second Party’s financial condition. (3) If the Second Party fails to provide Performance Assurance within five (5) Business Days after receipt of written demand therefore, such failure will be considered an Event of Default by the Second Party under Article XVII of this Agreement and the Requesting Party shall have the right to exercise any of the remedies provided for under that Article XVII. Nothing contained in this Article XV shall affect any other credit agreement or arrangement, if any, between the Parties. (4) If the Second Party provides a Letter of Credit, as Performance Assurance, the Second Party shall: (i) renew or cause the renewal of the Letter of Credit on a timely basis; and (ii) provide a substitute Letter of Credit at least twenty (20) Business Days prior to the expiration of the outstanding Letter of Credit if the issuer has indicated its intent not to renew such Letter of Credit.

Performance Assurances. ‌ (1) Should the creditworthiness, financial strength, or performance viability of a Party (the “Second Party”) become unsatisfactory to the other Party (the “Requesting Party”) in such Requesting Party’s commercially reasonably exercised discretion with regard to any transaction pursuant to this Agreement, the Requesting Party may require the Second Party to post or provide at the Second Party’s option: (a) a Letter of Credit; (b) other collateral or security by the Second Party that is acceptable to the Requesting Party in its commercially reasonably exercised discretion; (c) a Guarantee Agreement; or (d) some other mutually agreeable method of satisfying the Requesting Party (the items described in (a) through (d) are referred to as “Performance Assurance”). The Requesting Party may only request, and the Second Party shall only be required to provide, Performance Assurance in a commercially reasonable amount under the circumstances, and in any event, in a total amount up to the sum of the following: (i) the amount, if any, billed to and outstanding from the Second Party as of the date of such request, plus (ii) the amounts projected to be due and owing from the Second Party on the weekly invoice payment dates under Section 6.6 that fall within the 15 calendar day period following the date of such request (with such projection to be calculated by the Requesting Party, acting reasonably pursuant to this Agreement). The Second Party may request from the Requesting Party that the Performance Assurance be returned or reduced, on the condition that such a request shall only be made once every sixty (60) days during any period when a Performance Assurance has been provided. The Requesting Party shall be required to return or reduce the Performance Assurance, after receipt of the request from the Second Party, if, reasonably considering whether the factors that justified the Requesting Party’s request for Performance Assurance have been removed or improved, it is commercially reasonable to do so. (2) Events which may cause the Requesting Party to conclude question the Second Party’s creditworthiness, financial strength, or performance viability have become unsatisfactory as set out in Section 15.2(114.2(1) above, include, but are not limited to, any of the following: (a) The Requesting Party having knowledge that the Second Party (or its Credit Support Provider, if applicable) is failing to perform or defaulting under material terms of other material contracts; (b) The Second Party, or its Credit Support Provider has an Investment Grade Credit Rating (unenhanced by unaffiliated third Party support) and the credit rating falls below an Investment Grade Credit Rating according to at least one of S&P, Xxxxx’x or DBRS; (c) The Second Party, or its Credit Support Provider is rated BBB- by S&P (or the equivalent rating from Xxxxx’x or DBRS) and the Second Party or its Credit Support Provider (as applicable) has been either placed on negative credit watch or negative outlook by at least one such rating agency; or (bd) Other material adverse changes in the Second Party’s financial condition. (3) If the Second Party fails to provide Performance Assurance within five (5) Business Days after receipt of written demand therefore, such failure will be considered an Event of Default by the Second Party under Article XVII of this Agreement and the Requesting Party shall have the right to exercise any of the remedies provided for under that Article XVII. Nothing contained in this Article XV XIV shall affect any other credit agreement or arrangement, if any, between the Parties. (4) If the Second Party provides a Letter of Credit, as Performance Assurance, the Second Party shall: (i) renew or cause the renewal of the Letter of Credit on a timely basis; and (ii) provide a substitute Letter of Credit at least twenty (20) Business Days prior to the expiration of the outstanding Letter of Credit if the issuer has indicated its intent not to renew such Letter of Credit.

Performance Assurances. ‌ (1) Should the creditworthiness, financial strength, or performance viability of a Party (the “Second Party”) become unsatisfactory to the other Party (the “Requesting Party”) in such Requesting Party’s commercially reasonably exercised discretion with regard to any transaction pursuant to this Agreement, the Requesting Party may require the Second Party to post or provide at the Second Party’s option: (a) a Letter of Credit; (b) other collateral or security by the Second Party that is acceptable to the Requesting Party in its commercially reasonably exercised discretion; (c) a Guarantee Agreement; or (d) some other mutually agreeable method of satisfying the Requesting Party (the items described in (a) through (d) are referred to as “Performance Assurance”). The Requesting Party may only request, and the Second Party shall only be required to provide, Performance Assurance in a commercially reasonable amount under the circumstances, and in any event, in a total amount up to the sum of the following: (i) the amount, if any, billed to and outstanding from the Second Party as of the date of such request, plus (ii) the amounts projected to be due and owing from the Second Party on the weekly invoice payment dates under Section 6.6 that fall within the 15 calendar day period following the date of such request (with such projection to be calculated by the Requesting Party, acting reasonably pursuant to this Agreement). The Second Party may request from the Requesting Party that the Performance Assurance be returned or reduced, on the condition that such a request shall only be made once every sixty (60) days during any period when a Performance Assurance has been provided. The Requesting Party shall be required to return or reduce the Performance Assurance, after receipt of the request from the Second Party, if, reasonably considering whether the factors that justified the Requesting Party’s request for Performance Assurance have been removed or improved, it is commercially reasonable to do so. (2) Events which may cause the Requesting Party to conclude question the Second Party’s creditworthiness, financial strength, or performance viability have become unsatisfactory as set out in Section 15.2(113.2(1) above, include, but are not limited to, any of the following: (a) The Requesting Party having knowledge that the Second Party (or its Credit Support Provider, if applicable) is failing to perform or defaulting under material terms of other material contracts; (b) The Second Party, or its Credit Support Provider has an Investment Grade Credit Rating (unenhanced by unaffiliated third Party support) and the credit rating falls below an Investment Grade Credit Rating according to at least one of S&P, Xxxxx’x or DBRS; (c) The Second Party, or its Credit Support Provider is rated BBB- by S&P (or the equivalent rating from Xxxxx’x or DBRS) and the Second Party or its Credit Support Provider (as applicable) has been either placed on negative credit watch or negative outlook by at least one such rating agency; or (bd) Other material adverse changes in the Second Party’s financial condition. (3) If the Second Party fails to provide Performance Assurance within five (5) Business Days after receipt of written demand therefore, such failure will be considered an Event of Default by the Second Party under Article XVII XV of this Agreement and the Requesting Party shall have the right to exercise any of the remedies provided for under that Article XVIIXV. Nothing contained in this Article XV XIII shall affect any other credit agreement or arrangement, if any, between the Parties. (4) If the Second Party provides a Letter of Credit, as Performance Assurance, the Second Party shall: (i) renew or cause the renewal of the Letter of Credit on a timely basis; and (ii) provide a substitute Letter of Credit at least twenty (20) Business Days prior to the expiration of the outstanding Letter of Credit if the issuer has indicated its intent not to renew such Letter of Credit.

Performance Assurances. (1) Should the creditworthiness, financial strength, or performance viability of a Party (the “Second Party”) become unsatisfactory to the other Party (the “Requesting Party”) in such Requesting Party’s commercially reasonably exercised discretion with regard to any transaction pursuant to this Agreement, the Requesting Party may require the Second Party to post or provide at the Second Party’s option: (a) a Letter of Credit; (b) other collateral or security by the Second Party that is acceptable to the Requesting Party in its commercially reasonably exercised discretion; (c) a Guarantee Agreement; or (d) some other mutually agreeable method of satisfying the Requesting Party (the items described in (a) through (d) are referred to as “Performance Assurance”). The Requesting Party may only request, and the Second Party shall only be required to provide, Performance Assurance in a commercially reasonable amount under the circumstances, and in any event, in a total amount up to the sum of the following: (i) the amount, if any, billed to and outstanding from the Second Party as of the date of such request, plus (ii) the amounts projected to be due and owing from the Second Party on the weekly invoice payment dates under Section 6.6 that fall within the 15 calendar day period following the date of such request (with such projection to be calculated by the Requesting Party, acting reasonably pursuant to this Agreement). The Second Party may request from the Requesting Party that the Performance Assurance be returned or reduced, on the condition that such a request shall only be made once every sixty (60) days during any period when a Performance Assurance has been provided. The Requesting Party shall be required to return or reduce the Performance Assurance, after receipt of the request from the Second Party, if, reasonably considering whether the factors that justified the Requesting Party’s request for Performance Assurance have been removed or improved, it is commercially reasonable to do so. (2) Events which may cause the Requesting Party to conclude question the Second Party’s creditworthiness, financial strength, or performance viability have become unsatisfactory as set out in Section 15.2(1) above, include, but are not limited to, any of the following: (a) The Requesting Party having knowledge that the Second Party (or its Credit Support Provider, if applicable) is failing to perform or defaulting under material terms of other material contracts; (b) The Second Party, or its Credit Support Provider has an Investment Grade Credit Rating (unenhanced by unaffiliated third Party support) and the credit rating falls below an Investment Grade Credit Rating according to at least one of S&P, Moody’s or DBRS; (c) The Second Party, or its Credit Support Provider is rated BBB- by S&P (or the equivalent rating from Moody’s or DBRS) and the Second Party or its Credit Support Provider (as applicable) has been either placed on negative credit watch or negative outlook by at least one such rating agency; or (bd) Other material adverse changes in the Second Party’s financial condition. (3) If the Second Party fails to provide Performance Assurance within five (5) Business Days after receipt of written demand therefore, such failure will be considered an Event of Default by the Second Party under Article XVII of this Agreement and the Requesting Party shall have the right to exercise any of the remedies provided for under that Article XVII. Nothing contained in this Article XV shall affect any other credit agreement or arrangement, if any, between the Parties. (4) If the Second Party provides a Letter of Credit, as Performance Assurance, the Second Party shall: (i) renew or cause the renewal of the Letter of Credit on a timely basis; and (ii) provide a substitute Letter of Credit at least twenty (20) Business Days prior to the expiration of the outstanding Letter of Credit if the issuer has indicated its intent not to renew such Letter of Credit.