EXHIBIT 10.1
CONFORMED COPY
COMPLETION GUARANTEE
between
PETROCHEMICAL INDUSTRIES COMPANY K.S.C.
and
UNION CARBIDE CORPORATION
as Guarantors
NATIONAL BANK OF KUWAIT S.A.K.
as Intercreditor Agent
and
CITICORP TRUSTEE COMPANY LIMITED
as Debt Trustee
▇▇▇▇▇▇▇▇ Chance
London
CONTENTS
Clause Page No.
1. Interpretation................................................... 2
2. Guarantee........................................................ 2
3. Completion Date.................................................. 3
4. Termination of Guarantee on Completion........................... 3
5. Preservation of Rights........................................... 5
6. Payments......................................................... 6
7. Suspense Account................................................. 7
8. Taxes............................................................ 7
9. Tax Receipts..................................................... 7
10. Continuing Security.............................................. 8
11. Assignment and Benefit........................................... 8
12. Amendments....................................................... 8
13. Notices.......................................................... 8
14. Remedies and Waivers............................................. 9
15. Partial Invalidity............................................... 9
16. Law.............................................................. 9
17. Jurisdiction..................................................... 9
SCHEDULE
Form of Letter of Credit................................................ 11
THIS AGREEMENT is made on 15 day of September, 1996
BETWEEN:
(1) PETROCHEMICAL INDUSTRIES COMPANY K.S.C. ("PIC");
(2) UNION CARBIDE CORPORATION ("UCC") (PIC and UCC being hereinafter
referred to individually as a "Guarantor" and together as the "Guarantors");
(3) NATIONAL BANK OF KUWAIT S.A.K. (in its capacity as intercreditor agent
under the Common Terms Agreement for and on behalf of the Banks, the
"Intercreditor Agent"); and
(4) CITICORP TRUSTEE COMPANY LIMITED (in its capacity as debt trustee under
the Security Trust Agreement for and on behalf of the Primary Beneficiaries,
the "Debt Trustee").
WHEREAS:
(A) The Term Loan Banks have, on the terms and subject to the conditions
therein contained, agreed to lend money to the Company for the purposes of the
Project pursuant to the Term Loan Facility Agreement.
(B) The Lessor has, on the terms and subject to the conditions therein
contained, agreed to purchase certain assets from the Company pursuant to the
Sale Agreement and to lease the same to the Company for the purposes of the
Project pursuant to the Lease.
(C) The Working Capital Banks have, on the terms and subject to the
conditions therein contained, agreed to lend money to the Company for the
purposes of the Project pursuant to the Working Capital Facility Agreement.
(D) Each of the Guarantors beneficially owns 45 per cent. of the outstanding
common stock in the capital of the Company on the date hereof.
(E) It is a condition of the Term Loan Banks, the Lessor and the Working
Capital Banks agreeing to make available, respectively, the Term Loan
Facility, the Lease Facility and the Working Capital Facility that the
Guarantors execute this Agreement.
(F) In consideration of the foregoing, the Guarantors have each agreed to
enter into this Agreement on the terms herein contained.
NOW IT IS HEREBY AGREED as follows:
1. Interpretation
1.1 Capitalised terms shall bear the meaning ascribed thereto in Section 1
of the Schedule to the definitions agreement dated of even date herewith
between Equate Petrochemical Co. K.S.C. (Closed), UCC, PIC, the Intercreditor
Agent and the Debt Trustee (as the same may be amended from time to time by
the parties thereto in accordance with the terms thereof, the "Definitions
Agreement").
1.2 The rules of construction set out in Section 2 of the Schedule to the
Definitions Agreement shall be applied in construing various terms and
references used herein.
2. Guarantee
2.1 Subject to the further provisions of this Agreement, each Guarantor
hereby irrevocably and unconditionally:
(i) guarantees to the Primary Beneficiaries the due and punctual
payment and performance of all the Guaranteed Obligations and promises to pay
to the Debt Trustee immediately on demand all amounts from time to time due
and payable (but unpaid) by the Company in respect thereof;
(ii) agrees as a primary obligation to indemnify the Primary
Beneficiaries from time to time immediately on demand from and against any
loss or expense incurred by any or all of the Primary Beneficiaries as a
result of any of the Guaranteed Obligations being or becoming void, voidable
or unenforceable for any reason whatsoever, whether or not known to any of the
Primary Beneficiaries, the amount of such loss or expense being the amount
which any or all of the Primary Beneficiaries would otherwise have been
entitled to recover from the Company in respect of the Guaranteed Obligations;
and
(iii) agrees as a primary obligation to indemnify the Primary
Beneficiaries from time to time immediately on demand from and against any
loss or expense incurred by any or all of them as a result of any breach by
such Guarantor of its obligations under Clause 3,
Provided that the maximum combined liability of the Guarantors under Clause
2.1(i) or Clause 2.1(ii) in respect of any sum becoming payable to any
Approved Hedging Counterparty pursuant to any Approved Hedging Agreement shall
be subject to such caps as the Company, the Guarantors and such Approved
Hedging Counterparty may have agreed in writing prior to the execution of such
Approved Hedging Agreement.
2.2 Each Guarantor's obligations under Clause 2.1 shall be limited to its
Respective Percentage of any amount constituting a Guaranteed Obligation which
is not paid when due or, as the case may be, of any such amount becoming void,
voidable or unenforceable or of any loss or expense incurred by the relevant
Primary Beneficiaries.
2.3 The obligations of the Guarantors under this Agreement shall be several
and not joint. Neither Guarantor shall be responsible for any of the
obligations of the other Guarantor hereunder resulting from the latter's
failure to discharge any such obligation.
2.4 The Debt Trustee agrees that if it makes demand on one Guarantor in
relation to any amount payable by such Guarantor pursuant to this Agreement,
it shall (subject to Clause 4) contemporaneously make a demand on the other
Guarantor for any amount then payable by such other Guarantor pursuant to this
Agreement, but no failure by the Debt Trustee to make demand of a Guarantor
pursuant to this Clause 2.4 shall limit or otherwise affect the obligations of
the other Guarantor hereunder to make immediate payment of the amount demanded
of it hereunder.
2.5 Any demand by the Debt Trustee under this Agreement shall be accompanied
by a certificate from the Debt Trustee certifying the amount of the Guaranteed
Obligations and/or any loss or expense contemplated by Clause 2.1(iii) to
which such demand relates and such certificate shall, in the absence of
manifest error, be conclusive evidence of such amount. Except as expressly
provided herein, each Guarantor hereby waives all requirements as to
diligence, presentment, demand of payment, protest or notice of any kind with
respect to its payment obligations hereunder.
2.6 The Debt Trustee may make multiple demands under this Agreement. Only
the Debt Trustee may make demands under this Agreement.
3. Completion Date
The Guarantors hereby covenant and undertake with the Primary
Beneficiaries to procure that the Plant Completion Tests are satisfied on or
prior to 30 September 2000 (including, without limitation, and to the extent
necessary, by making Extraordinary Shareholder Contributions in an amount
equal to any Cost Overruns).
4. Termination of Guarantee on Completion
4.1 Each Guarantor's obligations under Clause 2 and Clause 3 shall terminate
on:
(i) the date on which the Debt Trustee determines and notifies the
Guarantors, the Company and all Primary Beneficiaries that the Primary
Beneficiary Release Date has occurred; or
(ii) the first date falling after the date (the "Relevant Date") upon
which all the Completion Conditions shall have been satisfied, as determined
and notified to the Company and the Guarantors by the Intercreditor Agent
acting in good faith following consultation, with the Technical Bank, the
Technical Consultant, the Insurance Bank, the Insurance Consultant, the
Modelling Bank, the Market Consultant and the Debt Trustee (and the
Intercreditor Agent agrees to enter into such consultations with a view to
making such determination and giving such notification from time to time upon
the request of the Guarantors), upon which:
(a) any Guaranteed Obligations which remain outstanding on the
Relevant Date; and
(b) any amounts demanded by the Debt Trustee on or prior to the
Relevant Date and payable (but unpaid) by such Guarantor pursuant to the terms
hereof,
(each as notified to the Guarantors by the Debt Trustee within
fourteen (14) days of the Relevant Date), are satisfied (and, for the
avoidance of doubt, with effect from the Relevant Date the liability of the
Guarantors shall be limited to the amounts set out in paragraphs (a) and (b)
of this Clause 4.1).
4.2 If, on any date (the "Financial Test Date"):
(i) the Relevant Date would have occurred but for failure to satisfy
the test set out in paragraph (v) of the definition of Financial Test (and,
for the avoidance of doubt, all other Financial Tests and all other Completion
Conditions had been satisfied on or before such date); and
(ii) the test set out in paragraph (v) of the definition of Financial
Test would have been satisfied if UCC had (a) not been released from its
obligation to provide a Letter of Credit in accordance with Clause 9 of the
Sponsor Support Agreement by virtue of becoming an Expropriated Sponsor and
(b) provided such Letter of Credit; and
(iii) PIC provides a Letter of Credit in an amount equal to its
Respective Percentage of the ASC Facility Amount as required by the Sponsor
Support Agreement,
(as determined and notified to the Company and the Guarantors by the
Intercreditor Agent acting in good faith following consultation, to the extent
applicable, with the Technical Bank, the Technical Consultant, the Insurance
Bank, the Insurance Consultant, the Modelling Bank, the Marketing Consultant
and the Debt Trustee) then on the first date thereafter upon which:
(a) any Guaranteed Obligations which remain outstanding on the
Financial Test Date; and
(b) any amounts demanded by the Debt Trustee on or prior to the
Financial Test Date and payable (but unpaid) by such Guarantor pursuant to the
terms hereof,
(each as notified to the Guarantor by the Debt Trustee within fourteen
(14) days of the Financial Test Date) are satisfied:
(x) (without prejudice to UCC's continuing obligations hereunder) PIC
shall be released from its several obligations under Clauses 2 and 3 (and, for
the avoidance of doubt, with effect from the Financial Test Date, the
liability of PIC shall be limited to its Respective Percentage of the amounts
set out in paragraphs (a) and (b) of this Clause 4.2); and
(y) UCC shall have the right, by arranging for a standby letter of
credit to be issued in accordance with Clauses 4.2 and 4.3 supporting its
obligations hereunder, to limit its continuing obligations under Clause 2 and
Clause 3 (other than in respect of the amounts set forth in (a) and (b) above)
to $54,000,000.
4.3 The standby letter of credit issued in accordance with Clause 4.2(y)
above shall:
(i) be opened and maintained in favour of the Debt Trustee;
(ii) be issued and confirmed by banks acceptable to the Majority Term
Banks with long term credit ratings of not less than A (or any equivalent
replacement thereof) by Standard & Poor's Corporation (or the equivalent
thereof by ▇▇▇▇▇'▇ Investor Services, Inc.);
(iii) be drawable on demand by the Debt Trustee and shall be drawn, as
between UCC and the Debt Trustee on any day following the day on which an
amount is required to be paid by UCC hereunder, subject to the rights of the
Debt Trustee under Clause 4.4;
(iv) have available for drawing, on one or more occasions, an aggregate
sum of $54,000,000;
(v) have an initial expiry date falling no earlier than two years
after the date of issue; and
(vi) be substantially in the form set out in the Schedule and otherwise
generally on terms and conditions reasonably acceptable to the Majority Term
Banks.
4.4 If:
(i) any standby letter of credit issued in accordance with Clause
4.2(y) is scheduled to expire before the full amount thereof has been drawn
and is not replaced by one or more alternative standby letters of credit
(which satisfy the requirements set out in Clause 4.3) at least two months
prior to such expiry date; or
(ii) if the long term credit rating of any bank by which such letter of
credit is issued or confirmed falls below BBB+ (or any equivalent replacement
thereof) by Standard & Poor's Corporation (or the equivalent thereof by
▇▇▇▇▇'▇ Investors Services, Inc.) and such letter of credit is not replaced by
one or more alternative standby letters of credit (which satisfy the
requirements set out in Clause 4.3) within two months of such date,
then, in either such case, the Debt Trustee may draw the full amount of
such letter of credit and place the funds on deposit as security for UCC's
continuing obligations under this Agreement.
5. Preservation of Rights
5.1 The obligations of each Guarantor herein contained shall be in addition
to and independent of every other security which the Debt Trustee or any other
Primary Beneficiary may at any time hold in respect of any of the Guaranteed
Obligations and may be enforced without the Debt Trustee or any other Primary
Beneficiary first having recourse to any such security and without the Debt
Trustee or any other Primary Beneficiary first taking steps or proceedings
against the Company.
5.2 Neither the obligations of each Guarantor herein contained nor the
rights, powers and remedies conferred in respect of each Guarantor upon the
Debt Trustee or any other Primary Beneficiary by the Finance Documents or by
law shall be discharged, impaired or otherwise affected by:
(i) the winding-up, dissolution, administration or re-organisation of
the Company or any other person, or any change in its status, function,
control or ownership;
(ii) any of the obligations of the Company or any other person under
any of the Finance Documents being or becoming illegal, invalid, unenforceable
or ineffective in any respect;
(iii) time or other indulgence being granted or agreed to be granted to
the Company or any other person in respect of its obligations under any of the
Finance Documents;
(iv) any amendment to, or any variation, waiver or release of, any
obligation of the Company or any other person under any of the Finance
Documents;
(v) any failure to take, or fully to take, any security contemplated
by any of Finance Documents or otherwise agreed to be taken in respect of the
Company's obligations under any of the Finance Documents;
(vi) any failure to realise or fully to realise the value of, or any
release, discharge, exchange or substitution of, any security taken in respect
of the Company's obligations under any of the Finance Documents; or
(vii) any other act (other than repayment of the Guaranteed
Obligations), event or omission which, but for this Clause 5.2, might operate
to discharge, impair or otherwise affect any of the obligations of either
Guarantor herein contained or any of the rights, powers or remedies conferred
upon the Debt Trustee by the Finance Documents or by law.
5.3 Any settlement or discharge given by the Debt Trustee or any other
Primary Beneficiary to either Guarantor in respect of such Guarantor's
obligations hereunder or any other agreement reached between the Debt Trustee
or any other Primary Beneficiary and such Guarantor in relation thereto shall
be, and be deemed always to have been, void if any act on the faith of which
the Debt Trustee or such other Primary Beneficiary gave such Guarantor that
settlement or discharge or entered into that agreement is subsequently avoided
by or in pursuance of any provision of law.
5.4 Neither the Debt Trustee nor any other Primary Beneficiary shall be
obliged before the Debt Trustee may exercise any of the rights, powers or
remedies conferred upon it in respect of either Guarantor hereby or by law:
(i) to make any demand of the Company or any other person;
(ii) to take any action or obtain judgment in any court against the
Company or any other person;
(iii) to make or file any claim or proof in a winding-up or dissolution
of the Company or any other person; or
(iv) to enforce or seek to enforce any security taken in respect of any
of the obligations of the Company under any of the Finance Documents.
6. Payments
6.1 On each date on which this Agreement requires an amount to be paid by a
Guarantor to the Debt Trustee such Guarantor shall make the same available to
the Debt Trustee by payment to such Proceeds Account as the Debt Trustee shall
specify for such purpose. Any amount payable by a Guarantor in relation to a
Guaranteed Obligation pursuant to Clause 2.1(i) or Clause 2.1(ii) shall be
paid in the currency of the amount which the Debt Trustee or any or all of the
Primary Beneficiaries would otherwise have been entitled to recover from the
Company in respect of such Guaranteed Obligation. Any amount payable by a
Guarantor pursuant to Clause 2.1(iii) shall be paid in the currency of the
loss or expense incurred by the Debt Trustee or, as the case may be, any or
all of the Primary Beneficiaries as a result of the breach by such Guarantor
of its obligations under Clause 3. Any payment received by the Debt Trustee
in a currency other than those required to discharge Guaranteed Obligations
shall be converted (unless such sums are to be credited for the time being to
a suspense account) by the Debt Trustee from its existing currency of
denomination into any required currency at the Account Bank's then prevailing
spot rate for the purchase of the required currency with the first mentioned
currency at the office of the Account Bank by which such conversion is made
and, following such conversion, credited to a Proceeds Account.
6.2 All payments required to be made by a Guarantor hereunder shall be
calculated without reference to any set-off or counterclaim and shall be made
free and clear of and without any deduction for or on account of any set-off
or counterclaim.
7. Suspense Account
All amounts received, recovered or realised by the Debt Trustee from a
Guarantor in relation to any Guaranteed Obligation may, in the Debt Trustee's
discretion, be credited to an interest bearing suspense account in the name of
the Debt Trustee and may be held in such account until the Debt Trustee is
satisfied that all Secured Obligations owed to the Primary Beneficiaries have
been paid and discharged in full.
8. Taxes
8.1 Each payment to be made by a Guarantor hereunder shall be made without
set-off or counterclaim and free and clear of any withholdings or deductions
for or on account of any present or future taxes, unless such Guarantor is
compelled by law to make payment subject to taxes. In the latter event, such
Guarantor shall at the same time pay such additional amount as may be
necessary to ensure that the recipient receives a net amount equal to the full
amount which it would have received had payment from such Guarantor not been
subject to any such taxes and shall promptly account to the relevant
authorities for the relevant amount of any such taxes so withheld or deducted.
8.2 Without prejudice to the provisions of Clause 8.1, if any Primary
Beneficiary (or the Debt Trustee or any Agent on its behalf) is required to
make any payment on account of tax on or in relation to any sum received or
receivable hereunder from a Guarantor (including, without limitation, any sum
received or receivable under this Clause 8.2) or any liability in respect of
any such payment is asserted, imposed, levied or assessed against such Primary
Beneficiary (or the Debt Trustee or any Agent on its behalf), such Guarantor
shall, upon demand of the Debt Trustee, indemnify such person against such
payment or liability, together with any interest, penalties and expenses
payable or incurred in connection therewith.
9. Tax Receipts
9.1 If, at any time, either Guarantor is required by law to make any
deduction or withholding from any sum that has become payable by it hereunder,
such Guarantor shall so advise the Debt Trustee not later than the time at
which it is obliged to pay the same.
9.2 If either Guarantor makes any payment hereunder in respect of which it
is required to make any deduction or withholding, it shall pay the full amount
required to be deducted or withheld to the relevant taxation or other
authority within the time allowed for such payment under applicable law and
shall deliver to the Debt Trustee, within ten days after it has made such
payment to the applicable authority, an original receipt (or a certified copy
thereof) issued by such authority or other satisfactory evidence of payment in
respect of the payment to such authority of all amounts so required to be
deducted or withheld.
10. Continuing Security
Subject to Clause 4 hereof, the obligations of each Guarantor herein
contained shall constitute and be continuing obligations notwithstanding any
settlement of account or other matter or thing whatsoever and, in particular
but without limitation, shall not be considered satisfied by any intermediate
payment or satisfaction of all or any of the Guaranteed Obligations and shall
continue in full force and effect until final payment in full of all amounts
owing by the Company in respect of such Guaranteed Obligations.
11. Assignment and Benefit
11.1 None of the Company or the Guarantors may assign, transfer, novate or
dispose of its respective rights or obligations hereunder or any rights
arising by way of subrogation or otherwise as a result of any payments made
hereunder (other than pursuant to the Deed of Subordination).
11.2 The Debt Trustee holds the benefit of this Agreement on trust for the
Primary Beneficiaries. For this purpose, the obligations of each Guarantor
under this Agreement are given by it in favour of the Debt Trustee and each
Primary Beneficiary.
12. Amendments
No amendment, waiver, variation, supplementation or modification in
relation to this Agreement shall be effective unless such amendment, waiver,
variation, supplementation or modification is entered into pursuant to an
instrument in writing signed by all the parties hereto.
13. Notices
13.1 Each communication to be made by any party hereto to any other party
hereto, shall be made in writing but, unless otherwise stated, may be made by
telex, facsimile transmission or letter.
13.2 Any communication or document to be made or delivered by any party
hereto to any other party hereto shall (unless that other person has by
fifteen days' prior written notice to the other parties specified another
address, telex number or facsimile number) be made or delivered to that other
person at the address identified with its signature below, shall be deemed to
have been made or delivered when despatched (in the case of any communication
made by telex or facsimile) or (in the case of any communication made by
letter) when left at that address or (as the case may be) ten days after being
deposited in the post postage prepaid in an envelope addressed to it at that
address Provided that any communication or document to be made or delivered to
the Debt Trustee or the Intercreditor Agent shall be effective only when
received by the Debt Trustee or the Intercreditor Agent and then only if the
same is expressly marked for the attention of the department or officer
identified with the Debt Trustee's or, as the case may be, the Intercreditor
Agent's signature below (or such other department or officer as the Debt
Trustee or the Intercreditor Agent shall from time to time specify for this
purpose).
13.3 Each communication and document made or delivered by any party hereto to
any other party hereto shall be in the English language or accompanied by a
translation thereof into English certified (by an officer of the person making
or delivering the same) as being a true and accurate translation thereof.
14. Remedies and Waivers
No failure to exercise, nor any delay in exercising, on the part of the
Debt Trustee, of any right or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any right or remedy
prevent any further or other exercise thereof or the exercise of any other
right or remedy. The rights and remedies herein provided are cumulative and
not exclusive of any rights or remedies provided by law.
15. Partial Invalidity
If, at any time, any provision hereof is or becomes illegal, invalid or
unenforceable in any respect under the law of any jurisdiction, neither the
legality, validity or enforceability of the remaining provisions hereof nor
the legality, validity or enforceability of such provision under the law of
any other jurisdiction shall in any way be affected or impaired thereby.
16. Law
This Agreement shall be governed by and construed in accordance with
English law.
17. Jurisdiction
17.1 Each Guarantor irrevocably agrees that the courts of England shall have
jurisdiction to hear and determine any suit, action or proceeding, and to
settle any disputes, which may arise out of or in connection with this
Agreement and, for such purposes, irrevocably submits to the jurisdiction of
such courts.
17.2 UCC irrevocably agrees that the courts of the State of New York and the
courts of the United States of America in New York shall have jurisdiction to
hear and determine any suit, action or proceeding, and to settle any disputes,
which may arise out of or in connection with this Agreement and, for such
purposes, irrevocably submits to the jurisdiction of such courts.
17.3 UCC and (in the case of Clause 17.1 only) PIC irrevocably waives any
objection which it might now or hereafter have to any of the courts referred
to in Clauses 17.1 and 17.2 being nominated as a forum to hear and determine
any suit, action or proceeding, and to settle any disputes, which may arise
out of or in connection with this Agreement and agrees not to claim that any
such court is not a convenient or appropriate forum.
17.4 Each Guarantor agrees that the process by which any suit, action or
proceeding in England is begun may be served on it by being delivered to
Hackwood Secretaries Limited of ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇-▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇ or its principal place of business in England from time to time. If
the appointment of the person identified in this Clause 17.4 ceases to be
effective UCC or, as the case may be, PIC shall immediately appoint a further
person in England to accept service of process on its behalf in England and,
failing such appointment within 15 days, the Debt Trustee shall be entitled to
appoint such a person by notice to each Guarantor. Nothing contained herein
shall affect the right to serve process in any other manner permitted by law.
17.5 The submission to the jurisdiction of the courts referred to in Clauses
17.1 and 17.2 shall not (and shall not be construed so as to) limit the right
of the Debt Trustee to take proceedings against either Guarantor in any other
court of competent jurisdiction nor shall the taking of proceedings in any one
or more jurisdictions preclude the taking of proceedings in any other
jurisdiction (whether concurrently or not) if and to the extent permitted by
applicable law.
17.6 Each Guarantor hereby consents generally in respect of any legal action
or proceeding arising out of or in connection with this Agreement to the
giving of any relief or the issue of any process in connection with such
action or proceeding including, without limitation, the making, enforcement or
execution against any property whatsoever (irrespective of its use or intended
use) of any order or judgment which may be made or given in such action or
proceeding.
17.7 To the extent that either Guarantor may in any jurisdiction claim for
itself or its assets immunity from suit, execution, attachment (whether in aid
of execution, before judgment or otherwise) or other legal process and to the
extent that in any such jurisdiction there may be attributed to itself or its
assets such immunity (whether or not claimed), it hereby irrevocably agrees
not to claim and hereby irrevocably waives such immunity to the full extent
permitted by the laws of such jurisdiction and, in particular, to the intent
that in any proceedings taken in New York the foregoing waiver of immunity
shall have effect under and be construed in accordance with the United States
Foreign Sovereign Immunities Act of 1976.
17.8 Each party hereto hereby waives any rights that it may have in any
jurisdiction to trial by jury.
IN WITNESS WHEREOF this Agreement has been duly executed on the date first
written at the start of this Agreement.
SCHEDULE
Form of Letter of Credit
To: [ ] (the "Debt Trustee")
L/C No: [ ]
Date: [ ]
Dear Sirs
Irrevocable Letter of Credit in relation to the Equate Petrochemical Project
issued pursuant to the Completion Guarantee (the "Completion Guarantee") dated
[ ] 1996 between Petrochemical Industries Company K.S.C., Union
Carbide Corporation ("UCC"), the Debt Trustee and National Bank of Kuwait
S.A.K.
1. In this letter the following expressions have the meanings set opposite
them:
"Demand": each written notice of demand by the Debt Trustee in the
form set out in the Appendix.
"Expiry Date": [ ] (as the same may be extended in
accordance with paragraph 6 below).
"Issuing Bank": [ ]
"Issuing Bank's
"Address": [ ]
"Total Sum": $54,000,000 [or in the case of subsequent replacement
L/C's the outstanding amount of UCC's cap]
2. Upon the Issuing Bank receiving a Demand before the Expiry Date, the
Issuing Bank irrevocably and unconditionally (but subject to the remaining
provisions of this letter of credit) agrees to pay to the Debt Trustee the
amount specified in the Demand on the date falling five business days after
the receipt by the Issuing Bank of the Demand or such later date (falling not
more than 30 days after the Expiry Date) as may be specified in the Demand.
3. (a) The aggregate amount payable by the Issuing Bank hereunder shall
not exceed the Total Sum.
(b) Any payment made hereunder shall be made by the Issuing Bank by
direct bank transfer to such account with such bank as may be specified in the
Demand, or in such other manner as may be acceptable to the Debt Trustee in
accordance with the terms of the Demand.
(c) The obligations of the Issuing Bank hereunder shall cease upon the
Expiry Date except in respect of any Demand received by the Issuing Bank
hereunder on or prior to such date.
4. Each Demand shall specifically refer to this Letter of Credit Re Equate
Petrochemical Project No. [ ] and shall be given to the Issuing Bank by
notice in writing by an authorised signatory of the Debt Trustee at the
Issuing Bank's Address (marked for the attention of [ ] or such
other person as may have been notified to the Debt Trustee for this purpose)
with a copy to UCC.
5. This Letter of Credit may be amended only by an instrument in writing
signed on behalf of the Issuing Bank and the Debt Trustee.
6. This Letter of Credit shall be governed by the laws of England and is
subject to the Uniform Customs and Practice for Documentary Credits, 1993
Revision, International Chamber of Commerce Publication Number 500 insofar as
the same are applicable (and, in accordance with the second sentence of
Article 17, the Issuing Bank hereby agrees that if this Letter of Credit
expires during any interruption of business referred to in the first sentence
of such Article, the Issuing Bank shall remain liable to make payment under
this Letter of Credit in respect of any Demand made during such interruption
of business or within 15 business days after it has notified the Debt Trustee
that such interruption has ceased).
Yours faithfully
......................................................
For and on behalf of [Issuing Bank]
APPENDIX TO LETTER OF CREDIT
To: [Issuing Bank] L/C No: [ ]
Copy: [UCC]
Irrevocable Letter of Credit Re Equate Petrochemical Project dated [ ] 199[
] (the "Letter of Credit")
1. Terms defined in the Letter of Credit shall have the same meaning in
this Demand.
2. We refer to the Letter of Credit and hereby notify you that UCC is
required to pay $ [ ] in accordance with Clause 2 or Clause 3 of the
Completion Guarantee.
3. Accordingly we hereby demand payment no later than [ ] of the sum of
$[ ], such sum to be credited to the account no. [ ] in [our] name with [
details].
[Authorised Signatory]
for [Debt Trustee]
Dated [ ]
*
The Guarantors
PETROCHEMICAL INDUSTRIES COMPANY K.S.C.
By: KHALED BUHAMRAH
Address: ▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
Telex: 22134/22024
Telefax: (▇▇▇) ▇▇▇ ▇▇▇▇
UNION CARBIDE CORPORATION
By: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Address: ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇
▇▇▇
Telex:
Telefax: (▇▇▇) ▇▇▇ ▇▇▇▇
The Intercreditor Agent
NATIONAL BANK OF KUWAIT S.A.K.
By: SHAIKHA AL BAHAR
Address: ▇▇ ▇▇▇ ▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Telex: 23226 NATBANK
Telefax: (▇▇▇) ▇▇▇▇▇▇▇
The Debt Trustee
CITICORP TRUSTEE COMPANY LIMITED
By: WAGDI RABBATT
Address: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Telex: 896581
Telefax: (▇▇▇▇) ▇▇▇▇ ▇▇▇
KP$001$6.25