Substituted Interest Rate Clause Samples
The Substituted Interest Rate clause defines the process for replacing the original interest rate specified in an agreement with a new rate under certain circumstances, such as changes in law or the discontinuation of a benchmark rate. Typically, this clause outlines the conditions that trigger the substitution, the method for determining the new rate—often referencing an alternative benchmark or a rate agreed upon by the parties—and any necessary adjustments to maintain economic equivalence. Its core practical function is to ensure the continuity and fairness of interest calculations when the original rate becomes unavailable or inappropriate, thereby reducing uncertainty and potential disputes.
Substituted Interest Rate. In the event that (i) the Administrative Agent shall have reasonably determined (which determination shall be conclusive and binding upon the Borrower) that by reason of circumstances affecting the interbank eurodollar market adequate and reasonable means do not exist for ascertaining the LIBOR applicable pursuant to Section 2.9 or (ii) the Required Lenders shall have notified the Administrative Agent that they have reasonably determined (which determination shall be conclusive and binding on the Borrower) that the applicable LIBOR will not adequately and fairly reflect the cost to such Lenders of maintaining or funding loans bearing interest based on such LIBOR, with respect to any portion of the Loans that the Borrower has requested be made as LIBOR Loans or LIBOR Loans that will result from the requested conversion of any portion of the Advances into LIBOR Loans (each, an “Affected Advance”), the Administrative Agent shall promptly notify the Borrower and the Lenders (by telephone or otherwise, to be promptly confirmed in writing) of such determination, on or, to the extent practicable, prior to the requested Borrowing Date or Conversion Date for such Affected Advances. If the Administrative Agent shall give such notice, (a) any Affected Advances shall be made as Prime Rate Loans, (b) the Advances (or any portion thereof) that were to have been converted to Affected Advances shall be converted to or continued as Prime Rate Loans and (c) any outstanding Affected Advances shall be converted, on the last day of the then current Interest Period with respect thereto, to Prime Rate Loans. Until any notice under clauses (i) or (ii), as the case may be, of this Section has been withdrawn by the Administrative Agent (by notice to the Borrower promptly upon either (x) the Administrative Agent having determined that such circumstances affecting the LIBOR market no longer exist and that adequate and reasonable means do exist for determining the LIBOR pursuant to Section 2.9 or (y) the Administrative Agent having been notified by such Required Lenders that circumstances no longer render the Advances (or any portion thereof) Affected Advances), no further LIBOR Loans shall be required to be made by the Lenders nor shall the Borrower have the right to convert all or any portion of the Loans to LIBOR Loans.
Substituted Interest Rate. 44 3.10. Taxes; Net Payments ................................................................ 44 3.11.
Substituted Interest Rate. In the event that (i) the Administrative Agent shall have determined (which determination shall be conclusive and binding upon the Borrower) that by reason of circumstances affecting the interbank eurodollar market either adequate and reasonable means do not exist for ascertaining the Eurodollar Rate applicable pursuant to section 2.6 or (ii) in the event that any Lender shall have notified the Administrative Agent that it has determined (which determination shall be conclusive and binding on the Borrower) that the applicable Eurodollar Rate will not adequately and fairly reflect the cost to such Lender of maintaining or funding loans bearing interest based on such Eurodollar Rate, with respect to a proposed Loan that the Borrower has requested be made as a Eurodollar Loan, or a Eurodollar Loan that will result from the requested conversion of any Loan into a Eurodollar Loan (any such Loan being herein called an "Affected Loan"), the Administrative Agent shall promptly notify the Borrower and the Lenders (by telephone or otherwise) of such de termination, confirmed in writing, on or prior to the requested Borrowing Date for such Affected Loan or the requested conversion date of such Loan. If the Administrative Agent shall give such notice, (a) any requested Affected Loan shall be made as an ABR Loan, (b) any Loan that was to have been converted to an Affected Loan shall be converted to or continued as an ABR Loan and
Substituted Interest Rate. In the event that (i) the Administrative Agent shall have determined (which determination shall be conclusive and binding) that by reason of circumstances affecting the interbank eurodollar market either adequate or reasonable means do not exist for ascertaining the Eurodollar Rate, or (ii) Required Lenders shall have notified the Administrative Agent that they have determined (which determination shall be conclusive and binding absent manifest error) that the applicable Eurodollar Rate will not adequately and fairly reflect the cost to such Lenders of maintaining or funding loans bearing interest based on such Eurodollar Rate, with respect to any portion of the Revolving Credit Loans that the Borrower has requested be made as Eurodollar Advances or Eurodollar Advances that will result from the requested conversion of any portion of the Advances into Eurodollar Advances (each, an "Affected Advance"), the Administrative Agent shall promptly notify the Borrower and the Lenders (by telephone or otherwise, to be promptly confirmed in writing) of such determination, on or, to the extent practicable, prior to the requested Borrowing Date or Conversion Date for such Affected
Substituted Interest Rate. In the event that (a) the Agent shall have determined (which determination shall then be conclusive and binding upon the Borrowers), that by reason of circumstances affecting the interbank LIBOR market, adequate and reasonable means do not exist for ascertaining the LIBOR Rate pursuant to any of the Borrowers' election as provided herein, or (b) in the event that any Lender shall have notified the Agent that it has determined (which determination shall then be conclusive and binding on the Borrowers) that the LIBOR Rate will not adequately and fairly reflect the cost to such Lender of maintaining or funding loans bearing interest based on such LIBOR Rate, with respect to a Revolving Loan that any Borrower has requested be made as a LIBOR Rate Revolving Loan, or a Revolving Loan that will result from the requested Conversion of a Prime Loan into a LIBOR Rate Revolving Loan (any such Revolving Loan or portion thereof being herein called an "AFFECTED LOAN"), the Agent shall promptly notify the Borrowers and the Lenders (by telephone or otherwise) of such determination, confirmed in writing, on or prior to the requested borrowing date for such Affected Loan or the requested Conversion date of such Revolving Loan. Until any such notice under clause (a) of this subsection 2.09
Substituted Interest Rate. In the event that (i) the Administrative Agent shall have determined (which determination shall be conclusive and binding upon the Borrower) that by reason of circumstances affecting the interbank eurodollar market either adequate and reasonable means do not exist for ascertaining the Eurodollar Rate applicable pursuant to Section 2.10 or (ii) the Required Lenders shall have notified the Administrative Agent that they have determined (which determination shall be conclusive and binding on the Borrower) that the applicable Eurodollar Rate will not adequately and fairly reflect the cost to such Lenders of maintaining or funding loans bearing interest based on such Eurodollar Rate, with respect to any portion of the Loans that the Borrower has requested 21
Substituted Interest Rate. In the event that (i) the Administrative Agent shall have reasonably determined (which determination shall be conclusive and binding upon the Borrower) that by reason of circumstances affecting the interbank eurodollar market adequate and reasonable means do not exist for ascertaining the LIBOR applicable pursuant to Section 2.9 or (ii) the Required Lenders shall have notified the Administrative Agent that they have reasonably determined (which determination shall be conclusive and binding on the Borrower) that the applicable LIBOR will not adequately and fairly reflect the cost to such Lenders of maintaining or funding loans bearing interest based on such LIBOR, with respect to any portion of the Loans that the Borrower has requested be made as LIBOR Loans or LIBOR Loans that will result from the requested conversion of any portion of the Advances into LIBOR Loans (each, an “Affected Advance”), the Administrative Agent shall promptly notify the Borrower and the Lenders (by telephone or otherwise, to be promptly confirmed in writing) of such determination, on or, to the extent practicable, prior to the requested Borrowing Date or Conversion Date for such Affected
Substituted Interest Rate. 14 2.10 Illegality......................................... 14 2.11
Substituted Interest Rate. 37 2.11. TAXES; NET PAYMENTS.............................................................................38 2.12. ILLEGALITY......................................................................................38 2.13. INCREASED COSTS.................................................................................39 2.14.
Substituted Interest Rate. 44 SECTION 3.10 TAXES...........................................................45 SECTION 3.11