Phase Down Sample Clauses

Phase Down. Both parties have the right to elect to reduce the parties' Ethylene quantity obligations so long as any such reduction is accomplished in accordance with and subject to the following ("Phase Down"): i. Either party may exercise its right of Phase Down by providing at least 3 full calendar years irrevocable written notice (the "Phase Down Notice") to the other party for each calendar year affected by such Phase Down Notice, but in no event will Phase Down affect any calendar year prior to the calendar year beginning January 1, 2009. The party providing a Phase Down Notice shall state therein the Phase Down quantity such party elects for any Phase Down year specified in such Phase Down Notice. The timely delivery of the Phase Down Notice specifying the Phase Down quantity is an essential term of this Agreement. ii. In order to effect the parties' intention that Phase Down of the entire quantity hereunder could be completed in no less than 5 years and that the Phase Down quantity in any year may never exceed the quantity reduction that would occur in a 5 year uniform quantity Phase Down, the parties agree that a Phase Down Basis Quantity will be the basis for calculating the maximum Phase Down quantity in any year, as set forth in Subparagraphs iii. and iv., below. iii. As used herein, the "Phase Down Basis Quantity" will be the annual average of the purchased Ethylene quantity hereunder (plus any quantity Buyer may have been obligated to purchase but did not) for the 3 calendar years immediately preceding the first Phase Down year. iv. As used herein, the "Phase Down Annual Minimum" will equal Buyer's purchase obligation in the Phase Down period. In the first Phase Down year the Phase Down Annual Minimum shall not be less than 83.33% of the Phase Down Basis Quantity, and in any subsequent year, the reduction of the Phase Down Annual Minimum for that year as compared to the previous year may not exceed 16.67% of the Phase Down Basis Quantity. Subject to Subparagraph 2(f) vii, the party exercising its right to reduce the Ethylene quantity obligations under Paragraph 2(f) of this Agreement may elect to reduce the Phase Down Annual Minimum by said 16.67% or any lesser quantity. If a Reduction Event occurs during the Phase Down, the Phase Down Annual Minimum for the year in which the Reduction Event occurs and is continuing will be reduced by an amount equal to the product of (A) the reduction in ethylene use attributable to the reduction in practical production...