Participation Exposure Clause Samples
The Participation Exposure clause defines the extent of a party's financial or risk exposure in relation to their participation in a shared transaction or agreement. Typically, this clause specifies how much liability or benefit each participant assumes, often based on their proportional involvement or investment. For example, in a syndicated loan, each lender's exposure is limited to the amount they have contributed. The core function of this clause is to clearly allocate risk and responsibility among participants, preventing disputes and ensuring that no party is held liable beyond their agreed share.
Participation Exposure. If any Swingline Exposure or LC Exposure exists at the time a Lender becomes a Defaulting Lender then:
Participation Exposure. If any Swingline Exposure or LC Exposure exists at the time a Revolving Lender becomes a Defaulting Lender then:
(i) all or any part of the Swingline Exposure and LC Exposure (other than the portion of such Swingline Exposure referred to in clause (b) of the definition of such term) of such Defaulting Lender shall be reallocated among the non-Defaulting Lenders in accordance with their respective Applicable Percentages but only to the extent that (x) the conditions set forth in Section 4.02 are satisfied at the time of such reallocation (and, unless the Borrower shall have otherwise notified the Administrative Agent at such time, the Borrower shall be deemed to have represented and warranted that such conditions are satisfied at such time), (y) the sum of all non-Defaulting Lenders’ Revolving Exposures not exceed the total of all non-Defaulting Lenders’ Revolving Commitments and (z) such reallocation does not cause the Revolving Exposure of any non-Defaulting Lender to exceed such non-Defaulting Lender’s Revolving Commitment;
(ii) if the reallocation described in clause (i) above cannot, or can only partially, be effected, the Borrower shall within one Business Day following notice by the Administrative Agent (x) first, prepay such Swingline Exposure and (y) second, cash collateralize, for the benefit of the applicable Issuing Banks, the Borrower’s obligations corresponding to such Defaulting Lender’s LC Exposure (after giving effect to any partial reallocation pursuant to clause (i) above) in accordance with the procedures set forth in Section 2.05(j) for so long as such LC Exposure is outstanding;
(iii) if the Borrower cash collateralizes any portion of such Defaulting Lender’s LC Exposure pursuant to clause (ii) above, the Borrower shall not be required to pay any fees to such Defaulting Lender pursuant to Section 2.11(b) with respect to such Defaulting Lender’s LC Exposure during the period such Defaulting Lender’s LC Exposure is cash collateralized;
(iv) if the LC Exposure of the non-Defaulting Lenders is reallocated pursuant to clause (i) above, then the fees payable to the Lenders pursuant to Sections 2.11(a) and 2.11(b) shall be adjusted in accordance with such non-Defaulting Lenders’ Applicable Percentages; and
(v) if all or any portion of such Defaulting Lender’s LC Exposure is neither reallocated nor cash collateralized pursuant to clause (i) or (ii) above, then, without prejudice to any rights or remedies of any Issuing Bank or any Lender hereu...
Participation Exposure. If any Swingline Exposure, Available Currency Loans, Canadian Currency Loans or LC Exposure exists at the time a Revolving Lender becomes a Defaulting Lender then:
Participation Exposure. If any Swingline Loans or Letters of Credit are outstanding at the time a Bank becomes a Defaulting Bank then:
Participation Exposure if any Swingline Exposure or LC Exposure exists or any Protective Advance is outstanding at the time a U.S. Lender becomes a Defaulting Lender then: