ISDAÒ International Swap Dealers Association, Inc. MASTER AGREEMENT dated as of September 27, 2007
Exhibit
99.1
(Multicurrency—Cross
Border)
ISDAÒ
International
Swap Dealers Association, Inc.
MASTER
AGREEMENT
dated
as of September 27, 2007
XXXXXXX
XXXXX CAPITAL SERVICES, INC.,
a
Delaware Corporation
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and
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CATERPILLAR
FINANCIAL ASSET TRUST
2007-A, a Delaware Statutory
Trust
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have
entered and/or anticipate entering into one or more transactions (each a
"Transaction") that are or will be governed by this Master Agreement, which
includes the schedule (the "Schedule"), and the documents and other confirming
evidence (each a "Confirmation") exchanged between the parties confirming those
Transactions.
Accordingly,
the parties agree as follows:—
1. Interpretation
(a) Definitions.
The terms defined in Section 14 and in the Schedule will have the meanings
therein specified for the purpose of this Master Agreement.
(b) Inconsistency.
In the event of any inconsistency between the provisions of the Schedule
and the other provisions of this Master Agreement, the Schedule will
prevail. In the event of any inconsistency between the provisions of
any Confirmation and this Master Agreement (including the Schedule), such
Confirmation will prevail for the purpose of the relevant
Transaction.
(c) Single
Agreement. All Transactions are entered into in reliance
on the fact that this Master Agreement and all Confirmations form a single
agreement between the parties (collectively referred to as this "Agreement"),
and the parties would not otherwise enter into any Transactions.
2. Obligations
(a) General
Conditions.
(i) Each
party will make each payment or delivery specified in each Confirmation to
be
made by it, subject to the other provisions of this Agreement.
(ii) Payments
under this Agreement will be made on the due date for value on that date in
the
place of the account specified in the relevant Confirmation or otherwise
pursuant to this Agreement, in freely transferable funds and in the manner
customary for payments in the required currency. Where settlement is by delivery
(that is, other than by payment), such delivery will be made for receipt on
the
due date in the manner customary for the relevant obligation unless otherwise
specified in the relevant Confirmation or elsewhere in this
Agreement.
(iii) Each
obligation of each party under Section 2(a)(i) is subject to (1) the condition
precedent that no Event of Default or Potential Event of Default with respect
to
the other party has occurred and is continuing, (2) the condition precedent
that
no Early Termination Date in respect of the relevant Transaction has occurred
or
been effectively designated and (3) each other applicable condition precedent
specified in this Agreement.
(b)
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Change
of Account. Either party may change its account for
receiving a payment or delivery by giving notice to the other party
at
least five Local Business Days prior to the scheduled date for the
payment
or delivery to which such change applies unless such other party
gives
timely notice of a reasonable objection to such
change.
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(c) Netting.
If on any date amounts would otherwise be payable:—
(i) in
the same currency; and
(ii) in
respect of the same Transaction,
by
each party to the other, then, on such date, each party’s obligation to make
payment of any such amount will be automatically satisfied and discharged and,
if the aggregate amount that would otherwise have been payable by one
party exceeds the aggregate amount that would otherwise have been payable by
the
other party, replaced by an obligation upon the party by whom the larger
aggregate amount would have been payable to pay to the other party the excess
of
the larger aggregate amount over the smaller aggregate amount.
The
parties may elect in respect of two or more Transactions that a net amount
will
be determined in respect of all amounts payable on the same date in the same
currency in respect of such Transactions, regardless of whether such amounts
are
payable in respect of the same Transaction. The election may be made in the
Schedule or a Confirmation by specifying that subparagraph (ii) above will
not
apply to the Transactions identified as being subject to the election, together
with the starting date (in which case subparagraph (ii) above will not, or
will
cease to, apply to such Transactions from such date). This election may be
made
separately for different groups of Transactions and will apply separately to
each pairing of Offices through which the parties make and receive payments
or
deliveries.
(d) Deduction
or Withholding for Tax.
(i) Gross-Up.
All payments under this Agreement will be made without any deduction or
withholding for or on account of any Tax unless such deduction or withholding
is
required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, then in effect. If a party is so required to
deduct or withhold, then that party ("X") will:—
(1) promptly
notify the other party ("Y") of such requirement;
(2) pay
to the relevant authorities the full amount required to be deducted or withheld
(including the full amount required to be deducted or withheld from any
additional amount paid by X to Y under this Section 2(d)) promptly upon the
earlier of determining that such deduction or withholding is required or
receiving notice that such amount has been assessed against Y;
(3) promptly
forward to Y an official receipt (or a certified copy), or other documentation
reasonably acceptable to Y, evidencing such payment to such authorities;
and
(4) if
such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment to which
Y is otherwise entitled under this Agreement, such additional amount as is
necessary to ensure that the net amount actually received by Y (free and
clear of Indemnifiable Taxes, whether assessed against X or Y)
will equal the full amount Y would have received had no such deduction or
withholding been required. However, X will not be required to pay any additional
amount to Y to the extent that it would not be required to be paid but
for:—
(A) the
failure by Y to comply with or perform any agreement contained in
Section 4(a)(i), 4(a)(iii) or 4(d); or
(B) the
failure of a representation made by Y pursuant to Section 3(f) to be accurate
and true unless such failure would not have occurred but for (I) any action
taken by a taxing authority, or brought in a court of competent jurisdiction,
on
or after the date on which a Transaction is entered into (regardless of whether
such action is taken or brought with respect to a party to this Agreement)
or
(II) a Change in Tax Law.
(ii) Liability.
If:—
(1) X
is required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, to make any deduction or withholding in respect
of which X would not be required to pay an additional amount to Y under Section
2(d)(i)(4);
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(2) X
does not so deduct or withhold; and
(3) a
liability resulting from such Tax is assessed directly against X,
then,
except to the extent Y has satisfied or then satisfies the liability resulting
from such Tax, Y will promptly pay to X the amount of such liability (including
any related liability for interest, but including any related liability for
penalties only if Y has failed to comply with or perform any agreement contained
in Section 4(a)(i), 4(a)(iii) or 4(d)).
(e) Default
Interest; Other Amounts. Prior to the occurrence or effective
designation of an Early Termination Date in respect of the relevant Transaction,
a party that defaults in the performance of any payment obligation will, to
the
extent permitted by law and subject to Section 6(c), be required to pay
interest (before as well as after judgment) on the overdue amount to the other
party on demand in the same currency as such overdue amount, for the period
from
(and including) the original due date for payment to (but excluding) the date
of
actual payment, at the Default Rate. Such interest will be calculated on the
basis of daily compounding and the actual number of days elapsed. If, prior
to
the occurrence or effective designation of an Early Termination Date in respect
of the relevant Transaction, a party defaults in the performance of any
obligation required to be settled by delivery, it will compensate the other
party on demand if and to the extent provided for in the relevant Confirmation
or elsewhere in this Agreement.
3. Representations
Each
party represents to the other party (which representations will be deemed to
be
repeated by each party on each date on which a Transaction is entered into
and,
in the case of the representations in Section 3(f), at all times until the
termination of this Agreement) that:—
(a) Basic
Representations.
(i)
Status. It is duly organised and validly
existing under the laws of the jurisdiction of its organisation or incorporation
and, if relevant under such laws, in good standing;
(ii)
Powers. It has the power to execute this Agreement and
any other documentation relating to this Agreement to which it is a party,
to
deliver this Agreement and any other documentation relating to this Agreement
that it is required by this Agreement to deliver and to perform its obligations
under this Agreement and any obligations it has under any Credit Support
Document to which it is a party and has taken all necessary action to authorise
such execution, delivery and performance;
(iii)
No Violation or Conflict. Such execution, delivery and
performance do not violate or conflict with any law applicable to it, any
provision of its constitutional documents, any order or judgment of any court
or
other agency of government applicable to it or any of its assets or any
contractual restriction binding on or affecting it or any of its
assets;
(iv)
Consents. All governmental and other consents that are
required to have been obtained by it with respect to this Agreement or any
Credit Support Document to which it is a party have been obtained and are in
full force and effect and all conditions of any such consents have been complied
with; and
(v)
Obligations
Binding. Its obligations under this
Agreement and any Credit Support Document to which it is a party constitute
its
legal, valid and binding obligations, enforceable in accordance with their
respective terms (subject to applicable bankruptcy, reorganisation, insolvency,
moratorium or similar laws affecting creditors’ rights generally and subject, as
to enforceability, to equitable principles of general application (regardless
of
whether enforcement is sought in a proceeding in equity or at
law)).
(b) Absence
of Certain Events. No Event of Default or Potential Event of
Default or, to its knowledge, Termination Event with respect to it has occurred
and is continuing and no such event or circumstance would occur as a result
of
its entering into or performing its obligations under this Agreement or any
Credit Support Document to which it is a party.
(c) Absence
of Litigation. There is not pending or, to its knowledge,
threatened against it or any of its Affiliates any action, suit or proceeding
at
law or in equity or before any court, tribunal, governmental body, agency or
official or any arbitrator that is likely to affect the legality, validity
or
enforceability against it of this Agreement or any Credit Support Document
to
which it is a party or its ability to perform its obligations under
this Agreement or such Credit Support Document.
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(d) Accuracy
of Specified Information. All applicable information that
is furnished in writing by or on behalf of it to the other party and is
identified for the purpose of this Section 3(d) in the Schedule is, as of the
date of the information, true, accurate and complete in every material
respect.
(e) Payer
Tax Representation. Each representation specified in the
Schedule as being made by it for the purpose of this Section 3(e) is accurate
and true.
(f) Payee
Tax Representations. Each representation specified in the
Schedule as being made by it for the purpose of this Section 3(f) is accurate
and true.
4. Agreements
Each
party agrees with the other that, so long as either party has or may have any
obligation under this Agreement or under any Credit Support Document to which
it
is a party:—
(a) Furnish
Specified Information. It will deliver to the other party or, in
certain cases under subparagraph (iii) below, to such government or taxing
authority as the other party reasonably directs:—
(i) any
forms, documents or certificates relating to taxation specified in the Schedule
or any Confirmation;
(ii) any
other documents specified in the Schedule or any Confirmation; and
(iii) upon
reasonable demand by such other party, any form or document that may be required
or reasonably requested in writing in order to allow such other party or its
Credit Support Provider to make a payment under this Agreement or any applicable
Credit Support Document without any deduction or withholding for or on account
of any Tax or with such deduction or withholding at a reduced rate
(so long as the completion, execution or submission of such form or document
would not materially prejudice the legal or commercial position of the party
in
receipt of such demand),with any such form or document to be accurate
and completed in a manner reasonably satisfactory to such other party
and to be executed and to be delivered with any reasonably required
certification,
in
each case by the date specified in the Schedule or such Confirmation or, if
none
is specified, as soon as reasonably practicable.
(b) Maintain
Authorisations. It will use all
reasonable efforts to maintain in full force and effect all consents of any
governmental or other authority that are required to be obtained by it with
respect to this Agreement or any Credit Support Document to which it is a party
and will use all reasonable efforts to obtain any that may become necessary
in
the future.
(c) Comply
with Laws. It will comply in all material respects with all
applicable laws and orders to which it may be subject if failure so to comply
would materially impair its ability to perform its obligations under this
Agreement or any Credit Support Document to which it is a party.
(d) Tax
Agreement. It will give notice of any failure of a representation
made by it under Section 3(f) to be accurate and true promptly upon learning
of
such failure.
(e) Payment
of Stamp Tax. Subject to Section 11, it will pay any Stamp Tax
levied or imposed upon it or in respect of its execution or performance of
this
Agreement by a jurisdiction in which it is incorporated, organised, managed
and
controlled, or considered to have its seat, or in which a branch or office
through which it is acting for the purpose of this Agreement is located ("Stamp
Tax Jurisdiction") and will indemnify the other party against any Stamp Tax
levied or imposed upon the other party or in respect of the other party’s
execution or performance of this Agreement by any such Stamp Tax Jurisdiction
which is not also a Stamp Tax Jurisdiction with respect to the other
party.
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5. Events
of Default and Termination Events
(a) Events
of Default. The occurrence at any time with respect to a
party or, if applicable, any Credit Support Provider of such party or any
Specified Entity of such party of any of the following events constitutes an
event of default (an "Event of Default") with respect to such
party:—
(i)
Failure to Pay or
Deliver.
Failure
by the party to
make, when due, any payment under this Agreement or delivery under Section
2(a)(i) or 2(e) required to be made by it if such failure is not remedied on
or
before the third Local Business Day after notice of such failure is given to
the
party;
(ii)
Breach of Agreement. Failure by the party to
comply with or perform any agreement or obligation (other than an obligation
to
make any payment under this Agreement or delivery under Section 2(a)(i) or
2(e)
or to give notice of a Termination Event or any agreement or obligation under
Section 4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by the
party in accordance with this Agreement if such failure is not remedied on
or
before the thirtieth day after notice of such failure is given to the
party;
(iii)
Credit Support Default.
(1) Failure
by the party or any Credit Support Provider of such party to comply with or
perform any agreement or obligation to be complied with or performed by it
in
accordance with any Credit Support Document if such failure is continuing after
any applicable grace period has elapsed;
(2) the
expiration or termination of such Credit Support Document or the failing or
ceasing of such Credit Support Document to be in full force and effect for
the
purpose of this Agreement(in either case other than in accordance with its
terms) prior to the satisfaction of all obligations of such party
under each Transaction to which such Credit Support Document relates without
the
written consent of the other party; or
(3) the
party or such Credit Support Provider disaffirms, disclaims, repudiates or
rejects, in whole or in part, or challenges the validity of, such Credit Support
Document;
(iv)
Misrepresentation. A representation (other
than a representation under Section 3(e) or (f)) made or repeated or deemed
to
have been made or repeated by the party or any Credit Support Provider of such
party in this Agreement or any Credit Support Document proves to have been
incorrect or misleading in any material respect when made or repeated or deemed
to have been made or repeated;
(v)
Default under Specified Transaction. The
party, any Credit Support Provider of such party or any applicable Specified
Entity of such party (1) defaults under a Specified Transaction and, after
giving effect to any applicable notice requirement or grace period, there occurs
a liquidation of, an acceleration of obligations under, or an early termination
of, that Specified Transaction, (2) defaults, after giving effect to any
applicable notice requirement or grace period, in making any payment or delivery
due on the last payment, delivery or exchange date of, or any payment on early
termination of, a Specified Transaction (or such default continues for at least
three Local Business Days if there is no applicable notice requirement or grace
period) or (3) disaffirms, disclaims, repudiates or rejects, in whole or in
part, a Specified Transaction (or such action is taken by any person or entity
appointed or empowered to operate it or act on its behalf);
(vi)
Cross Default. If "Cross Default"
is specified in the Schedule as applying to the party, the occurrence or
existence of (1) a default, event of default or other similar condition or
event
(however described) in respect of such party, any Credit Support Provider of
such party or any applicable Specified Entity of such party under one or more
agreements or instruments relating to Specified Indebtedness of any of them
(individually or collectively) in an aggregate amount of not less than the
applicable Threshold Amount (as specified in the Schedule) which has resulted
in
such Specified Indebtedness becoming, or becoming capable at such time of being
declared, due and payable under such agreements or instruments, before it would
otherwise have been due and payable or (2) a default by such party, such Credit
Support Provider or such Specified Entity (individually or collectively) in
making one or more payments on the due date thereof in an aggregate amount
of
not less than the applicable Threshold Amount under such agreements or
instruments (after giving effect to any applicable notice requirement or grace
period);
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(vii)
Bankruptcy. The party, any Credit Support
Provider of such party or any applicable Specified Entity of such
party:—
(1)
is dissolved (other than pursuant to a consolidation, amalgamation or merger);
(2) becomes insolvent or is unable to pay its debts or fails or admits in
writing its inability generally to pay its debts as they become due; (3) makes
a
general assignment, arrangement or composition with or for the benefit of its
creditors; (4) institutes or has instituted against it a proceeding seeking
a
judgment of insolvency or bankruptcy or any other relief under any bankruptcy
or
insolvency law or other similar law affecting creditors’ rights, or a petition
is presented for its winding-up or liquidation, and, in the case of any such
proceeding or petition instituted or presented against it, such proceeding
or
petition (A) results in a judgment of insolvency or bankruptcy or the entry
of
an order for relief or the making of an order for its winding-up or liquidation
or (B) is not dismissed, discharged, stayed or restrained in each case within
30
days of the institution or presentation thereof; (5) has a resolution
passed for its winding-up, official management or liquidation (other than
pursuant to a consolidation, amalgamation or merger); (6) seeks or becomes
subject to the appointment of an administrator, provisional liquidator,
conservator, receiver, trustee, custodian or other similar official for it
or
for all or substantially all its assets; (7) has a secured party take possession
of all or substantially all its assets or has a distress, execution, attachment,
sequestration or other legal process levied, enforced or sued on or against
all
or substantially all its assets and such secured party maintains possession,
or
any such process is not dismissed, discharged, stayed or restrained, in each
case within 30 days thereafter; (8) causes or is subject to any event with
respect to it which, under the applicable laws of any jurisdiction, has an
analogous effect to any of the events specified in clauses (1) to (7)
inclusive); or (9) takes any action in furtherance of, or indicating its consent
to, approval of, or acquiescence in, any of the foregoing acts; or
(viii)
Merger Without Assumption. The party or any
Credit Support Provider of such party consolidates or amalgamates with, or
merges with or into, or transfers all or substantially all its assets to,
another entity and, at the time of such consolidation, amalgamation, merger
or
transfer:—
(1) the
resulting, surviving or transferee entity fails to assume all the obligations
of
such party or such Credit Support Provider under this Agreement or any Credit
Support Document to which it or its predecessor was a party by operation of
law
or pursuant to an agreement reasonably satisfactory to the other party to this
Agreement; or
(2) the
benefits of any Credit Support Document fail to extend (without the consent
of
the other party) to the performance by such resulting, surviving or transferee
entity of its obligations under this Agreement.
(b) Termination
Events. The occurrence at any time with respect to a
party or, if applicable, any Credit Support Provider of such party or any
Specified Entity of such party of any event specified below constitutes an
Illegality if the event is specified in (i) below, a Tax Event if the event
is
specified in (ii) below or a Tax Event Upon Merger if the event is specified
in
(iii) below, and, if specified to be applicable, a Credit Event Upon Merger
if
the event is specified pursuant to (iv) below or an Additional Termination
Event
if the event is specified pursuant to (v) below:—
(i) Illegality. Due
to the adoption of, or any change in, any applicable law after the date on
which
a Transaction is entered into, or due to the promulgation of, or any change
in,
the interpretation by any court, tribunal or regulatory authority with competent
jurisdiction of any applicable law after such date, it becomes unlawful (other
than as a result of a breach by the party of Section 4(b)) for such party (which
will be the Affected Party):—
(1) to
perform any absolute or contingent obligation to make a payment or delivery
or
to receive a payment or delivery in respect of such Transaction or to comply
with any other material provision of this Agreement relating to such
Transaction; or
(2) to
perform, or for any Credit Support Provider of such party to perform, any
contingent or other obligation which the party (or such Credit Support Provider)
has under any Credit Support Document relating to such Transaction;
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(ii) Tax
Event. Due to (x) any action taken by a taxing authority,
or brought in a court of competent jurisdiction, on or after the date on which
a
Transaction is entered into (regardless of whether such action is taken or
brought with respect to a party to this Agreement) or (y) a Change in Tax Law,
the party (which will be the Affected Party) will, or there is a
substantial likelihood that it will, on the next succeeding Scheduled Payment
Date (1) be required to pay to the other party an additional amount in respect
of an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest
under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an
amount is required to be deducted or withheld for or on account of a Tax (except
in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) and no additional
amount is required to be paid in respect of such Tax under Section 2(d)(i)(4)
(other than by reason of Section 2(d)(i)(4)(A) or (B));
(iii) Tax
Event Upon Merger. The party (the "Burdened Party") on
the next succeeding Scheduled Payment Date will either (1) be required to pay
an
additional amount in respect of an Indemnifiable Tax under Section 2(d)(i)(4)
(except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2)
receive a payment from which an amount has been deducted or withheld for or
on
account of any Indemnifiable Tax in respect of which the other party is not
required to pay an additional amount (other than by reason of Section
2(d)(i)(4)(A) or (B)), in either case as a result of a party consolidating
or
amalgamating with, or merging with or into, or transferring all or substantially
all its assets to, another entity (which will be the Affected Party) where
such
action does not constitute an event described in Section
5(a)(viii);
(iv) Credit
Event Upon Merger. If "Credit Event Upon Merger" is
specified in the Schedule as applying to the party, such party ("X"), any Credit
Support Provider of X or any applicable Specified Entity of X consolidates
or
amalgamates with, or merges with or into, or Transfers all or substantially
all
its assets to, another entity and such action does not constitute an event
described in Section 5(a)(viii) but the creditworthiness of the
resulting, surviving or transferee entity is materially weaker than that of
X,
such Credit Support Provider or such Specified Entity, as the case may be,
immediately prior to such action (and, in such event, X or its successor or
transferee, as appropriate, will be the Affected Party); or
(v) Additional
Termination Event. If any "Additional Termination Event"
is specified in the Schedule or any Confirmation as applying, the occurrence
of
such event (and, in such event, the Affected Party or Affected Parties shall
be
as specified for such Additional Termination Event in the Schedule or such
Confirmation).
(c) Event
of Default and Illegality. If an event or circumstance
which would otherwise constitute or give rise to an Event of Default also
constitutes an Illegality, it will be treated as an Illegality and will not
constitute an Event of Default.
6. Early
Termination
(a) Right
to Terminate Following Event of
Default. If at any time an Event of
Default with respect to a party (the "Defaulting Party") has occurred and is
then continuing, the other party (the "Non-defaulting Party") may, by not more
than 20 days’ notice to the Defaulting Party specifying the relevant Event of
Default, designate a day not earlier than the day such notice is effective
as an
Early Termination Date in respect of all outstanding Transactions. If, however,
"Automatic Early Termination" is specified in the Schedule as applying to a
party, then an Early Termination Date in respect of all outstanding Transactions
will occur immediately upon the occurrence with respect to such party of an
Event of Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to
the extent analogous thereto, (8), and as of the time immediately preceding
the
institution of the relevant proceeding or the presentation of the relevant
petition upon the occurrence with respect to such party of an Event of Default
specified in Section 5(a)(vii)(4) or, to the extent analogous thereto,
(8).
(b) Right
to Terminate Following Termination Event.
(i) Notice.
If a Termination Event occurs, an Affected Party will, promptly upon becoming
aware of it, notify the other party, specifying the nature of that Termination
Event and each Affected Transaction and will also give such other information
about that Termination Event as the other party may reasonably
require.
(ii) Transfer
to Avoid Termination Event. If either an Illegality under Section
5(b)(i)(1) or a Tax Event occurs and there is only one Affected Party, or if
a
Tax Event Upon Merger occurs and the Burdened Party is the Affected Party,
the
Affected Party will, as a condition to its right to designate an Early
Termination Date under Section 6(b)(iv), use all reasonable efforts (which
will
not require such party to incur a loss, excluding immaterial,
incidental expenses) to transfer within 20 days after it gives notice under
Section 6(b)(i) all its rights and obligations under this Agreement in respect
of the Affected Transactions to another of its Offices or Affiliates so that
such Termination Event ceases to exist.
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If
the Affected Party is not able to make such a transfer it will give notice
to
the other party to that effect within such 20 day period, whereupon the other
party may effect such a transfer within 30 days after the notice is given under
Section 6(b)(i).
Any
such transfer by a party under this Section 6(b)(ii) will be subject to and
conditional upon the prior written consent of the other party, which consent
will not be withheld if such other party’s policies in effect at such time would
permit it to enter into Transactions with the transferee on the terms
proposed.
(iii) Two
Affected Parties. If an Illegality under Section 5(b)(i)(1) or a
Tax Event occurs and there are two Affected Parties, each party will use all
reasonable efforts to reach agreement within 30 days after notice thereof is
given under Section 6(b)(i) on action to avoid that Termination
Event.
(iv) Right
to Terminate. If:—
(1) a
transfer under Section 6(b)(ii) or an agreement under Section 6(b)(iii), as
the
case may be, has not been effected with respect to all Affected Transactions
within 30 days after an Affected Party gives notice under Section 6(b)(i);
or
(2) an
Illegality under Section 5(b)(i)(2), a Credit Event Upon Merger or an Additional
Termination Event occurs, or a Tax Event Upon Merger occurs and the Burdened
Party is not the Affected Party,
either
party in the case of an Illegality, the Burdened Party in the case of a Tax
Event Upon Merger, any Affected Party in the case of a Tax Event or an
Additional Termination Event if there is more than one Affected Party, or the
party which is not the Affected Party in the case of a Credit Event Upon Merger
or an Additional Termination Event if there is only one Affected Party may,
by
not more than 20 days notice to the other party and provided that the relevant
Termination Event is then continuing, designate a day not earlier than the
day
such notice is effective as an Early Termination Date in respect of all Affected
Transactions.
(c) Effect
of Designation.
(i) If
notice designating an Early Termination Date is given under Section 6(a) or
(b),
the Early Termination Date will occur on the date so designated, whether or
not
the relevant Event of Default or Termination Event is then
continuing.
(ii) Upon
the occurrence or effective designation of an Early Termination Date, no further
payments or deliveries under Section 2(a)(i) or 2(e) in respect of the
Terminated Transactions will be required to be made, but without prejudice
to
the other provisions of this Agreement. The amount, if any, payable in respect
of an Early Termination Date shall be determined pursuant to Section
6(e).
(d) Calculations.
(i) Statement. On
or as soon as reasonably practicable following the occurrence of an Early
Termination Date, each party will make the calculations on its part, if any,
contemplated by Section 6(e) and will provide to the other party a statement
(1)
showing, in reasonable detail, such calculations (including all relevant
quotations and specifying any amount payable under Section 6(e)) and (2) giving
details of the relevant account to which any amount payable to it is to be
paid.
In the absence of written confirmation from the source of a quotation obtained
in determining a Market Quotation, the records of the party obtaining such
quotation will be conclusive evidence of the existence and accuracy of such
quotation.
(ii) Payment
Date. An amount calculated as being due in respect of any
Early Termination Date under Section 6(e) will be payable on the day that notice
of the amount payable is effective (in the case of an Early Termination Date
which is designated or occurs as a result of an Event of Default) and on the
day
which is two Local Business Days after the day on which notice of the amount
payable is effective (in the case of an Early Termination Date which is
designated as a result of a Termination Event). Such amount will be paid
together with (to the extent permitted under applicable law) interest thereon
(before as well as after judgment) in the Termination Currency, from (and
including) the relevant Early Termination Date to (but excluding) the date
such
amount is paid, at the Applicable Rate. Such interest will be calculated on
the
basis of daily compounding and the actual number of days elapsed.
8
(e) Payments
on Early Termination. If an Early Termination Date
occurs, the following provisions shall apply based on the parties’ election in
the Schedule of a payment measure, either "Market Quotation" or "Loss", and
a
payment method, either the "First Method" or the "Second Method". If the parties
fail to designate a payment measure or payment method in the Schedule, it will
be deemed that "Market Quotation" or the "Second Method", as the case may be,
shall apply. The amount, if any, payable in respect of an Early Termination
Date
and determined pursuant to this Section will be subject to any
Set-off.
(1) First
Method and Market Quotation. If the First Method and Market Quotation
apply, the Defaulting Party will pay to the Non-defaulting Party the excess,
if
a positive number, of (A) the sum of the Settlement Amount (determined by the
Non-defaulting Party) in respect of the Terminated Transactions and the
Termination Currency Equivalent of the Unpaid Amounts owing to the
Non-defaulting Party over (B) the Termination Currency Equivalent of the Unpaid
Amounts owing to the Defaulting Party.
(2) First
Method and Loss. If the First Method and Loss apply, the Defaulting Party
will pay to the Non-defaulting Party, if a positive number, the Non-defaulting
Party’s Loss in respect of this Agreement.
(3) Second
Method and Market Quotation. If the Second Method and Market Quotation
apply, an amount will be payable equal to (A) the sum of the Settlement Amount
(determined by the Non-defaulting Party) in respect of the Terminated
Transactions and the Termination Currency Equivalent of the Unpaid Amounts
owing
to the Non-defaulting Party less (B) the Termination Currency Equivalent of
the
Unpaid Amounts owing to the Defaulting Party. If that amount is a positive
number, the Defaulting Party will pay it to the Non-defaulting Party; if it
is a
negative number, the Non-defaulting Party will pay the absolute value of that
amount to the Defaulting Party.
(4) Second
Method and Loss. If the Second Method and Loss apply, an amount will be
payable equal to the Non-defaulting Party’s Loss in respect of this Agreement.
If that amount is a positive number, the Defaulting Party will pay it to the
Non-defaulting Party; if it is a negative number, the Non-defaulting Party
will
pay the absolute value of that amount to the Defaulting Party.
(ii) Termination
Events. If the Early Termination Date results from a
Termination Event:—
(1) One
Affected Party. If there is one Affected Party, the amount payable will be
determined in accordance with Section 6(e)(i)(3), if Market Quotation applies,
or Section 6(e)(i)(4), if Loss applies, except that, in either case, references
to the Defaulting Party and to the Non-defaulting Party will be deemed to be
references to the Affected Party and the party which is not the Affected Party,
respectively, and, if Loss applies and fewer than all the Transactions are
being
terminated, Loss shall be calculated in respect of all Terminated
Transactions.
(2) Two
Affected Parties. If there are two Affected Parties:—
(A) if
Market Quotation applies, each party will determine a Settlement Amount in
respect of the Terminated Transactions, and an amount will be payable equal
to
(I) the sum of (a) one-half of the difference between the Settlement Amount
of
the party with the higher Settlement Amount ("X") and the Settlement Amount
of
the party with the lower Settlement Amount ("Y") and (b) the Termination
Currency Equivalent of the Unpaid Amounts owing to X less (II) the Termination
Currency Equivalent of the Unpaid Amounts owing to Y; and
(B) if
Loss applies, each party will determine its Loss in respect of this Agreement
(or, if fewer than all the Transactions are being terminated, in respect of
all
Terminated Transactions) and an amount will be payable equal to one-half of
the
difference between the Loss of the party with the higher Loss ("X") and the
Loss
of the party with the lower Loss ("Y").
9
If
the amount payable is a positive number, Y will pay it to X; if it is a negative
number, X will pay the absolute value of that amount to Y.
(iii) Adjustment
for Bankruptcy. In circumstances where an Early
Termination Date occurs because "Automatic Early Termination" applies in respect
of a party, the amount determined under this Section 6(e) will be subject to
such adjustments as are appropriate and permitted by law to reflect any payments
or deliveries made by one party to the other under this Agreement (and retained
by such other party) during the period from the relevant Early Termination
Date
to the date for payment determined under Section 6(d)(ii).
(iv) Pre-Estimate.
The parties agree that if Market Quotation applies an amount recoverable under
this Section 6(e) is a reasonable pre-estimate of loss and not a penalty. Such
amount is payable for the loss of bargain and the loss of protection against
future risks and except as otherwise provided in this Agreement neither party
will be entitled to recover any additional damages as a consequence of such
losses.
7. Transfer
Subject
to Section 6(b)(ii), neither this Agreement nor any interest or obligation
in or
under this Agreement may be transferred (whether by way of security or
otherwise) by either party without the prior written consent of the other party,
except that:—
(a) a
party may make such a transfer of this Agreement pursuant to a consolidation
or
amalgamation with, or merger with or into, or transfer of all or substantially
all its assets to, another entity (but without prejudice to any other right
or
remedy under this Agreement); and
(b) a
party may make such a transfer of all or any part of its interest in any amount
payable to it from a Defaulting Party under Section 6(e).
Any
purported transfer that is not in compliance with this Section will be
void.
8. Contractual
Currency
(a) Payment
in the Contractual Currency. Each payment under this
Agreement will be made in the relevant currency specified in this Agreement
for
that payment (the "Contractual Currency"). To the extent permitted by
applicable law, any obligation to make payments under this Agreement in the
Contractual Currency will not be discharged or satisfied by any tender in any
currency other than the Contractual Currency, except to the extent such tender
results in the actual receipt by the party to which payment is owed, acting
in a
reasonable manner and in good faith in converting the currency so tendered
into
the Contractual Currency, of the full amount in the Contractual Currency of
all
amounts payable in respect of this Agreement. If for any reason the amount
in
the Contractual Currency so received falls short of the amount in the
Contractual Currency payable in respect of this Agreement, the party required
to
make the payment will, to the extent permitted by applicable law, immediately
pay such additional amount in the Contractual Currency as may be necessary
to
compensate for the shortfall. If for any reason the amount in the Contractual
Currency so received exceeds the amount in the Contractual Currency payable
in
respect of this Agreement, the party receiving the payment will refund promptly
the amount of such excess.
(b) Judgments.
To the extent permitted by applicable law, if any judgment or order expressed
in
a currency other than the Contractual Currency is rendered (i) for the payment
of any amount owing in respect of this Agreement, (ii) for the payment of any
amount relating to any early termination in respect of this Agreement or (iii)
in respect of a judgment or order of another court for the payment of any amount
described in (i) or (ii) above, the party seeking recovery, after recovery
in
full of the aggregate amount to which such party is entitled pursuant to the
judgment or order, will be entitled to receive immediately from the other party
the amount of any shortfall of the Contractual Currency received by such party
as a consequence of sums paid in such other currency and will refund promptly
to
the other party any excess of the Contractual Currency received by
such party as a consequence of sums paid in such other currency if such
shortfall or such excess arises or results from any variation between the rate
of exchange at which the Contractual Currency is converted into the currency
of
the judgment or order for the purposes of such judgment or order and the rate
of
exchange at which such party is able, acting in a reasonable manner and in
good
faith in converting the currency received into the Contractual Currency, to
purchase the Contractual Currency with the amount of the currency of the
judgment or order actually received by such party. The term "rate of exchange"
includes, without limitation, any premiums and costs of exchange payable in
connection with the purchase of or conversion into the Contractual
Currency.
10
(c) Separate
Indemnities. To the extent permitted by applicable law, these
indemnities constitute separate and independent obligations from the other
obligations in this Agreement, will be enforceable as separate and independent
causes of action, will apply notwithstanding any indulgence granted by the
party
to which any payment is owed and will not be affected by judgment being obtained
or claim or proof being made for any other sums payable in respect of this
Agreement.
(d) Evidence
of Loss. For the purpose of this Section 8, it will be sufficient
for a party to demonstrate that it would have suffered a loss had an actual
exchange or purchase been made.
9. Miscellaneous
(a) Entire
Agreement. This Agreement constitutes the entire
agreement and understanding of the parties with respect to its subject matter
and supersedes all oral communication and prior writings with respect
thereto.
(b) Amendments.
No amendment, modification or waiver in respect of this Agreement will be
effective unless in writing (including a writing evidenced by a facsimile
transmission) and executed by each of the parties or confirmed by an exchange
of
telexes or electronic messages on an electronic messaging system.
(c) Survival
of Obligations. Without prejudice to Sections 2(a)(iii)
and 6(c)(ii), the obligations of the parties under this Agreement will survive
the termination of any Transaction.
(d) Remedies
Cumulative. Except as provided in this Agreement, the
rights, powers, remedies and privileges provided in this Agreement are
cumulative and not exclusive of any rights, powers, remedies and privileges
provided by law.
(e) Counterparts
and Confirmations.
(i) This
Agreement (and each amendment, modification and waiver in respect of it) may
be
executed and delivered in counterparts (including by facsimile transmission),
each of which will be deemed an original.
(ii) The
parties intend that they are legally bound by the terms of each Transaction
from
the moment they agree to those terms (whether orally or otherwise). A
Confirmation shall be entered into as soon as practicable and may be executed
and delivered in counterparts (including by facsimile transmission) or be
created by an exchange of telexes or by an exchange of electronic message s
on
an electronic messaging system, which in each case will be sufficient for all
purposes to evidence a binding supplement to this Agreement. The parties will
specify therein or through another effective means that any such counterpart,
telex or electronic message constitutes a Confirmation.
(f) No
Waiver of Rights. A failure or delay in exercising any
right, power or privilege in respect of this Agreement will not be presumed
to
operate as a waiver, and a single or partial exercise of any right, power or
privilege will not be presumed to preclude any subsequent or further exercise,
of that right, power or privilege or the exercise of any other right, power
or
privilege.
(g) Headings.
The headings used in this Agreement are for convenience of reference only and
are not to affect the construction of or to be taken into consideration in
interpreting this Agreement.
10. Offices;
Multibranch Parties
(a) If
Section 10(a) is specified in the Schedule as applying, each party that enters
into a Transaction through an Office other than its head or home office
represents to the other party that, notwithstanding the place of booking office
or jurisdiction of incorporation or organisation of such party, the obligations
of such party are the same as if it had entered into the Transaction through
its
head or home office. This representation will be deemed to be repeated by such
party on each date on which a Transaction is entered into.
(b) Neither
party may change the Office through which it makes and receives payments or
deliveries for the purpose of a Transaction without the prior written consent
of
the other party.
(c) If
a party is specified as a Multibranch Party in the Schedule, such Multibranch
Party may make and receive payments or deliveries under any Transaction through
any Office listed in the Schedule, and the Office through which it makes and
receives payments or deliveries with respect to a Transaction will be specified
in the relevant Confirmation.
11
11. Expenses
A
Defaulting Party will, on demand, indemnify and hold harmless the other party
for and against all reasonable out-of-pocket expenses, including legal fees
and
Stamp Tax, incurred by such other party by reason of the enforcement and
protection of its rights under this Agreement or any Credit Support Document
to
which the Defaulting Party is a party or by reason of the early termination
of
any Transaction, including, but not limited to, costs of
collection.
12. Notices
(a) Effectiveness.
Any notice or other communication in respect of this Agreement may be given
in
any manner set forth below (except that a notice or other communication under
Section 5 or 6 may not be given by facsimile transmission or electronic
messaging system) to the address or number or in accordance with the electronic
messaging system details provided (see the Schedule) and will be deemed
effective as indicated:—
(i) if
in writing and delivered in person or by courier, on the date it is
delivered;
(ii) if
sent by telex, on the date the recipient’s answerback is received;
(iii) if
sent by facsimile transmission, on the date that transmission is received by
a
responsible employee of the recipient in legible form (it being agreed that
the
burden of proving receipt will be on the sender and will not be met by a
transmission report generated by the sender’s facsimile machine);
(iv) if
sent by certified or registered mail (airmail, if overseas) or the equivalent
(return receipt requested), on the date that mail is delivered or its delivery
is attempted; or
(v) if
sent by electronic messaging system, on the date that electronic message is
received,
unless
the date of that delivery (or attempted delivery) or that receipt, as
applicable, is not a Local Business Day or that communication is delivered
(or
attempted) or received, as applicable, after the close of business on a Local
Business Day, in which case that communication shall be deemed given and
effective on the first following day that is a Local Business Day.
(b) Change
of Addresses. Either party may by notice to the other
change the address, telex or facsimile number or electronic messaging system
details at which notices or other communications are to be given to
it.
13. Governing
Law and Jurisdiction
(a) Governing
Law. This Agreement will be governed by and construed in
accordance with the law specified in the Schedule.
(b) Jurisdiction.
With respect to any suit, action or proceedings relating to this Agreement
("Proceedings"), each party irrevocably:—
(i) submits
to the jurisdiction of the English courts, if this Agreement is expressed to
be
governed by English law, or to the non-exclusive jurisdiction of the courts
of
the State of New York and the United States District Court located in the
Borough of Manhattan in New York City, if this Agreement is expressed to be
governed by the laws of the State of New York; and
(ii) waives
any objection which it may have at any time to the laying of venue of any
Proceedings brought in any such court, waives any claim that such Proceedings
have been brought in an inconvenient forum and further waives the right to
object, with respect to such Proceedings, that such court does not have any
jurisdiction over such party.
Nothing
in this Agreement precludes either party from bringing Proceedings in any other
jurisdiction (outside, if this Agreement is expressed to be governed by English
law, the Contracting States, as defined in Section 1(3) of the Civil
Jurisdiction and Judgments Xxx 0000 or any modification, extension or
re-enactment thereof for the time being in force) nor will the bringing of
Proceedings in any one or more jurisdictions preclude the bringing of
Proceedings in any other jurisdiction.
(c) Service
of Process. Each party irrevocably appoints the Process
Agent (if any) specified opposite its name in the Schedule to receive, for
it
and on its behalf, service of process in any Proceedings. If for any reason
any
party’s Process Agent is unable to act as such, such party will promptly notify
the other party and within 30 days appoint a substitute process agent acceptable
to the other party. The parties irrevocably consent to service of process given
in the manner provided for notices in Section 12. Nothing in this Agreement
will affect the right of either party to serve process in any other manner
permitted by law.
12
(d) Waiver
of Immunities. Each party irrevocably waives, to the
fullest extent permitted by applicable law, with respect to itself and its
revenues and assets (irrespective of their use or intended use), all immunity
on
the grounds of sovereignty or other similar grounds from (i) suit, (ii)
jurisdiction of any court, (iii) relief by way of injunction, order for specific
performance or for recovery of property, (iv) attachment of its assets (whether
before or after judgment) and (v) execution or enforcement of any judgment
to
which it or its revenues or assets might otherwise be entitled in any
Proceedings in the courts of any jurisdiction and irrevocably agrees, to the
extent permitted by applicable law, that it will not claim any such immunity
in
any Proceedings.
14. Definitions
As
used in this Agreement:—
"Additional
Termination Event" has the meaning specified in Section
5(b).
"Affected
Party" has the meaning specified in Section 5(b).
"Affected
Transactions" means (a) with respect to any Termination Event
consisting of an Illegality, Tax Event or Tax Event Upon Merger, all
Transactions affected by the occurrence of such Termination Event and (b) with
respect to any other Termination Event, all Transactions.
"Affiliate"
means, subject to the Schedule, in relation to any person, any entity
controlled, directly or indirectly, by the person, any entity that controls,
directly or indirectly, the person or any entity directly or indirectly under
common control with the person. For this purpose, "control" of any entity or
person means ownership of a majority of the voting power of the entity or
person.
"Applicable
Rate" means:—
(a) in
respect of obligations payable or deliverable (or which would have been but
for
Section 2(a)(iii)) by a Defaulting Party, the Default Rate;
(b) in
respect of an obligation to pay an amount under Section 6(e) of either party
from and after the date (determined in accordance with Section 6(d)(ii)) on
which that amount is payable, the Default Rate;
(c) in
respect of all other obligations payable or deliverable (or which would have
been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default
Rate; and
(d) in
all other cases, the Termination Rate.
"Burdened
Party" has the meaning specified in Section 5(b).
"Change
in Tax Law" means the enactment, promulgation, execution or
ratification of, or any change in or amendment to, any law (or in the
application or official interpretation of any law) that occurs on or after
the
date on which the relevant Transaction is entered into.
"consent"
includes a consent, approval, action, authorisation, exemption, notice, filing,
registration or exchange control consent.
"Credit
Event Upon Merger" has the meaning specified in Section
5(b).
"Credit
Support Document" means any agreement or instrument that is
specified as such in this Agreement.
"Credit
Support Provider" has the meaning specified in the
Schedule.
"Default
Rate" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the relevant payee (as certified by it) if
it
were to fund or of funding the relevant amount plus 1% per annum.
13
"Defaulting
Party" has the meaning specified in Section 6(a).
"Early
Termination Date" means the date determined in accordance with
Section 6(a) or 6(b)(iv).
"Event
of Default" has the meaning specified in Section 5(a) and, if
applicable, in the Schedule.
"Illegality"
has the meaning specified in Section 5(b).
"Indemnifiable
Tax" means any Tax other than a Tax that would not be imposed in
respect of a payment under this Agreement but for a present or former connection
between the jurisdiction of the government or taxation authority imposing such
Tax and the recipient of such payment or a person related to such recipient
(including, without limitation, a connection arising from such recipient or
related person being or having been a citizen or resident of such jurisdiction,
or being or having been organised, present or engaged in a trade or business
in
such jurisdiction, or having or having had a permanent establishment or fixed
place of business in such jurisdiction, but excluding a connection arising
solely from such recipient or related person having executed, delivered,
performed its obligations or received a payment under, or enforced, this
Agreement or a Credit Support Document).
"law"
includes any treaty, law, rule or regulation (as modified, in the case of tax
matters, by the practice of any relevant governmental revenue authority) and
"lawful" and "unlawful" will
be construed accordingly.
"Local
Business Day" means, subject to the Schedule, a day on which
commercial banks are open for business (including dealings in foreign exchange
and foreign currency deposits) (a) in relation to any obligation under Section
2(a)(i), in the place(s) specified in the relevant Confirmation or, if not
so
specified, as otherwise agreed by the parties in writing or determined pursuant
to provisions contained, or incorporated by reference, in this Agreement, (b)
in
relation to any other payment, in the place where the relevant account is
located and, if different, in the principal financial centre, if any, of the
currency of such payment, (c) in relation to any notice or other communication,
including notice contemplated under Section 5(a)(i), in the city specified
in
the address for notice provided by the recipient and, in the case of a notice
contemplated by Section 2(b), in the place where the relevant new account is
to
be located and (d) in relation to Section 5(a)(v)(2), in the relevant
locations for performance with respect to such Specified
Transaction.
"Loss"
means, with respect to this Agreement or one or more Terminated Transactions,
as
the case may be, and a party, the Termination Currency Equivalent of an amount
that party reasonably determines in good faith to be its total losses and costs
(or gain, in which case expressed as a negative number) in connection with
this
Agreement or that Terminated Transaction or group of Terminated Transactions,
as
the case may be, including any loss of bargain, cost of funding or, at the
election of such party but without duplication, loss or cost incurred as a
result of its terminating, liquidating, obtaining or reestablishing any hedge
or
related trading position (or any gain resulting from any of them). Loss includes
losses and costs (or gains) in respect of any payment or delivery required
to
have been made (assuming satisfaction of each applicable condition precedent)
on
or before the relevant Early Termination Date and not made, except, so as to
avoid duplication, if Section 6(e)(i)(1) or (3) or 6(c)(ii)(2)(A) applies.
Loss
does not include a party’s legal fees and out-of-pocket expenses referred to
under Section 11. A party will determine its Loss as of the relevant Early
Termination Date, or, if that is not reasonably practicable, as of the earliest
date thereafter as is reasonably practicable. A party may (but need not)
determine its Loss by reference to quotations of relevant rates or prices from
one or more leading dealers in the relevant markets.
"Market
Quotation" means, with respect to one or more Terminated
Transactions and a party making the determination, an amount determined on
the
basis of quotations from Reference Market-makers. Each quotation will be for
an
amount, if any, that would be paid to such party (expressed as a negative
number) or by such party (expressed as a positive number) in consideration
of an
agreement between such party (taking into account any existing Credit Support
Document with respect to the obligations of such party) and the quoting
Reference Market-maker to enter into a transaction (the "Replacement
Transaction") that would have the effect of preserving for such party the
economic equivalent of any payment or delivery (whether the underlying
obligation was absolute or contingent and assuming the satisfaction of each
applicable condition precedent) by the parties under Section 2(a)(i) in respect
of such Terminated Transaction or group of Terminated Transactions that would,
but for the occurrence of the relevant Early Termination Date, have been
required after that date. For this purpose, Unpaid Amounts in respect of the
Terminated Transaction or group of Terminated Transactions are to be excluded
but, without limitation, any payment or delivery that would, but for the
relevant Early Termination Date, have been required (assuming satisfaction
of
each applicable condition precedent) after that Early Termination Date is to
be
included. The Replacement Transaction would be subject to such documentation
as
such party and the Reference Market-maker may, in good faith, agree. The party
making the determination (or its agent) will request each Reference Market-maker
to provide its quotation to the extent reasonably practicable as of the same
day
and time (without regard to different time zones) on or as soon as reasonably
practicable after the relevant Early Termination Date. The day and time as
of
which those quotations are to be obtained will be selected in good faith by
the
party obliged to make a determination under Section 6(e), and, if each party
is
so obliged, after consultation with the other. If more than three quotations
are
provided, the Market Quotation will be the arithmetic mean of the quotations,
without regard to the quotations having the highest and lowest values. If
exactly three such quotations are provided, the Market Quotation will be the
quotation remaining after disregarding the highest and lowest quotations. For
this purpose, if more than one quotation has the same highest value or lowest
value, then one of such quotations shall be disregarded. If fewer than three
quotations are provided, it will be deemed that the Market Quotation in respect
of such Terminated Transaction or group of Terminated Transactions cannot be
determined.
14
"Non-default
Rate" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the Non-defaulting Party (as certified by it)
if
it were to fund the relevant amount.
"Non-defaulting
Party" has the meaning specified in Section 6(a).
"Office"
means a branch or office of a party, which may be such party’s head or home
office.
"Potential
Event of Default" means any event which, with the giving of notice
or the lapse of time or both, would constitute an Event of Default.
"Reference
Market-makers" means four leading dealers in the relevant market
selected by the party determining a Market Quotation in good faith (a) from
among dealers of the highest credit standing which satisfy all the criteria
that
such party applies generally at the time in deciding whether to offer or to
make
an extension of credit and (b) to the extent practicable, from among such
dealers having an office in the same city.
"Relevant
Jurisdiction" means, with respect to a party, the jurisdictions
(a) in which the party is incorporated, organised, managed and controlled or
considered to have its seat, (b) where an Office through which the party is
acting for purposes of this Agreement is located, (c) in which the party
executes this agreement and (d) in relation to any payment, from or through
which such payment is made.
"Scheduled
Payment Date" means a date on which a payment or delivery is to be
made under Section 2(a)(i) with respect to a Transaction.
"Set-off"
means set-off, offset, combination of accounts, right of retention or
withholding or similar right or requirement to which the payer of an amount
under Section 6 is entitled or subject (whether arising under this Agreement,
another contract, applicable law or otherwise) that is exercised by, or imposed
on, such payer.
"Settlement
Amount" means, with respect to a party and any Early Termination
Date, the sum of:—
(a) the
Termination Currency Equivalent of the Market Quotations (whether positive
or
negative) for each Terminated Transaction or group of Terminated Transactions
for which a Market Quotation is determined; and
(b) such
party’s Loss (whether positive or negative and without reference to any Unpaid
Amounts) for each Terminated Transaction or group of Terminated Transactions
for
which a Market Quotation cannot be determined or would not (in the reasonable
belief of the party making the determination) produce a commercially reasonable
result.
"Specified
Entity" has the meaning specified in the Schedule.
"Specified
Indebtedness" means, subject to the Schedule, any obligation
(whether present or future, contingent or otherwise, as principal or surety
or
otherwise) in respect of borrowed money.
"Specified
Transaction" means, subject to the Schedule, (a) any transaction
(including an agreement with respect thereto) now existing or hereafter entered
into between one party to this Agreement (or any Credit Support Provider of
such
party or any applicable Specified Entity of such party) and the other party
to
this Agreement (or any Credit Support Provider of such other party or any
applicable Specified Entity of such other party) which is a rate swap
transaction, basis swap, forward rate transaction, commodity swap, commodity
option, equity or equity index swap, equity or equity index option, bond option,
interest rate option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, currency swap transaction, cross-currency
rate
swap transaction, currency option or any other similar transaction (including
any option with respect to any of these transactions), (b) any combination
of
these transactions and (c) any other transaction identified as a Specified
Transaction in this Agreement or the relevant confirmation.
15
"Stamp
Tax" means any stamp, registration, documentation or similar
tax.
"Tax"
means any present or future tax, levy, impost, duty, charge, assessment or
fee
of any nature (including interest, penalties and additions thereto) that is
imposed by any government or other taxing authority in respect of any payment
under this Agreement other than a stamp, registration, documentation or similar
tax.
"Tax
Event" has the meaning specified in Section 5(b).
"Tax
Event Upon Merger" has the meaning specified in Section
5(b).
"Terminated
Transactions" means with respect to any Early Termination Date (a)
if resulting from a Termination Event, all Affected Transactions and (b) if
resulting from an Event of Default, all Transactions (in either case) in effect
immediately before the effectiveness of the notice designating that Early
Termination Date (or, if "Automatic Early Termination" applies, immediately
before that Early Termination Date).
"Termination
Currency" has the meaning specified in the Schedule.
"Termination
Currency Equivalent" means, in respect of any amount denominated
in the Termination Currency, such Termination Currency amount and, in respect
of
any amount denominated in a currency other than the Termination Currency (the
"Other Currency"), the amount in the Termination Currency determined by the
party making the relevant determination as being required to purchase such
amount of such Other Currency as at the relevant Early Termination Date, or,
if
the relevant Market Quotation or Loss (as the case may be), is determined as
of
a later date, that later date, with the Termination Currency at the rate equal
to the spot exchange rate of the foreign exchange agent (selected as provided
below) for the purchase of such Other Currency with the Termination Currency
at
or about 11:00 a.m. (in the city in which such foreign exchange agent is
located) on such date as would be customary for the determination of such a
rate
for the purchase of such Other Currency for value on the relevant Early
Termination Date or that later date. The foreign exchange agent will, if only
one party is obliged to make a determination under Section 6(e), be selected
in
good faith by that party and otherwise will be agreed by the
parties.
"Termination
Event" means an Illegality, a Tax Event or a Tax Event Upon Merger
or, if specified to be applicable, a Credit Event Upon Merger or an Additional
Termination Event.
"Termination
Rate" means a rate per annum equal to the arithmetic mean of the
cost (without proof or evidence of any actual cost) to each party (as
certified by such party) if it were to fund or of funding such
amounts.
"Unpaid
Amounts" owing to any party means, with respect to an Early
Termination Date, the aggregate of (a) in respect of all Terminated
Transactions, the amounts that became payable (or that would have become payable
but for Section 2(a)(iii)) to such party under Section 2(a)(i) on or prior
to
such Early Termination Date and which remain unpaid as at such Early Termination
Date and (b) in respect of each Terminated Transaction, for each obligation
under Section 2(a)(i) which was (or would have been but for Section 2(a)(iii))
required to be settled by delivery to such party on or prior to such Early
Termination Date and which has not been so settled as at such Early Termination
Date, an amount equal to the fair market value of that which was (or would
have
been) required to be delivered as of the originally scheduled date for delivery,
in each case together with (to the extent permitted under applicable law)
interest, in the currency, of such amounts, from (and including) the date such
amounts or obligations were or would have been required to have been paid or
performed to (but excluding) such Early Termination Date, at the Applicable
Rate. Such amounts of interest will be calculated on the basis of daily
compounding and the actual number of days elapsed. The fair market value of
any
obligation referred to in clause (b) above shall be reasonably determined by
the
party obliged to make the determination under Section 6(e) or, if each party
is
so obliged, it shall be the average of the Termination Currency Equivalents
of
the fair market values reasonably determined by both parties.
[SIGNATURE
PAGE
FOLLOWS]
16
IN
WITNESS WHEREOF the parties have executed this document on the respective dates
specified below with effect from the date specified on the first page of this
document.
XXXXXXX
XXXXX CAPITAL SERVICES,
INC.
|
CATERPILLAR
FINANCIAL
ASSET
TRUST
2007-A,
by
The
Bank of New York
(Delaware), not in its individual capacity but solely as Owner
Trustee
|
|
(Name
of Party)
|
(Name
of Party)
|
|
By:/s/
Xxxxxxxx X. Xxxxxxx
|
By:/s/
Xxxxxxxx X. Xxxxx
|
|
Name:
Xxxxxxxx X. Xxxxxxx
Title:
Authorized Signatory
Date:
September 27, 2007
|
Name:
Xxxxxxxx X. Xxxxx
Title:
Vice President
Date:
|
|
[Signature
Page to ISDA Master]
SCHEDULE
to
the
(1992
– Multicurrency—Cross Border)
dated
as of September 27, 2007
between
XXXXXXX
XXXXX CAPITAL SERVICES,
INC.,
a
Delaware
corporation
("Party
A")
And
CATERPILLAR FINANCIAL ASSET TRUST
2007-A,
a
Delaware
Statutory Trust
("Party
B")
1.
|
Termination
Provisions.
|
a.
|
"Specified
Entity"
means in relation to Party A for
the purpose of:
|
Section
5(a)(v),
Not
applicable.
Section
5(a)(vi),
Not
applicable.
Section
5(a)(vii),
Not
applicable.
Section
5(b)(iv),
Not
applicable.
in
relation to Party B for the purpose
of:
Section
5(a)(v), Not applicable.
Section
5(a)(vi), Not applicable.
Section
5(a)(vii), Not applicable.
Section
5(b)(iv), Not applicable.
b.
|
"Specified
Transaction"
will have the meaning specified
in Section 14 of this Agreement unless another meaning is specified
here: No change
from Section 14.
|
c.
|
The
"Breach
of
Agreement"
provisions of Section 5(a)(ii),
the "Misrepresentation"
provisions of Section 5(a)(iv)
and the "Default
under
Specified Transaction"
provisions
of Section 5(a)(v) will
not apply to Party
B.
|
d.
|
The
"Credit
Support
Default"
provisions of Section 5(a)(iii)
will not apply to Party B except that Section 5(a)(iii)(1) will apply
in
respect of Party B's obligations under Paragraph 3(b) of the Credit
Support Annex.
|
(e) The
"Cross
Default"
provisions of Section
5(a)(vi) will not apply to Party B and will apply toParty A with a Threshold
Amount equal to
3 percent of Party A's shareholders' equity.
(f) "Bankruptcy"
Section
5(a)(vii)(2),(7) and (9) will
not apply to Party B.
Section
5(a)(vii)(4) will not apply to
Party B to the
extent any such proceeding or petition was instituted or presented by Party
A or
any of its Affiliates.
Section
5(a)(vii)(6) will not apply to
Party B to the extent that it refers to (i) any such appointment effected
pursuant to the
Basic
Documents or (ii) any
appointment to which Party B has not become subject.
Section
5(a)(vii)(8) will not apply to
Party B to the extent that it relates to clauses of Section 5(a)(vii) that
are
not applicable to Party B per this Agreement.
(g) Tax
Event and Tax Event Upon
Merger
Section
5(b)(ii) will apply, provided
that the words "(x) any action taken by a taxing authority, or brought in a
court of competent jurisdiction, on or after the date on which a Transaction
is
entered into (regardless of
whether such action is taken or brought with respect to a party to this
Agreement) or (y)" are hereby deleted.
Section
5(b)(iii) will apply, provided
that Party A will not be entitled to designate an Early Termination Date by
reason of a Tax Event Upon Merger in respect of which it is the Affected
Party.
Section
6(b)(ii) will apply, provided
that the words "or if a Tax Event Upon Merger occurs and the Burdened Party
is
the Affected Party" are hereby deleted.
(h) The
"Credit
Event Upon
Merger"
provisions of Section
5(b)(iv) will not
apply to Party A orto
Party B.
(i) The
"Automatic
Early
Termination"
provisions
of Section 6(a) will not
apply to Party A or
toParty
B.
(j) Payments
on Early
Termination; General. Subject
to Part 1(k) below, for
the purpose ofSection 6(e):
i.
|
Market
Quotation will
apply.
|
ii.
|
The
Second Method will
apply.
|
iii.
|
Notwithstanding
anything to the
contrary set forth in the Agreement, if (1) Party B designates an
Early
Termination Date pursuant to Part 5(n), 5(o) or 5(p)
in respect of which
any Transaction is a
Terminated Transaction and (2) Party B enters into a replacement
transaction with a third party on or before such Early Termination
Date,
then (x) the amount, if any, payable by Party B to Party A in respect
of
such Early Termination
Date and such Transaction
will not exceed
the amount received by Party B from such third party in consideration
of
entering into such replacement transaction and (y) the amount, if
any,
payable by Party A to Party B in respect of such Early Termination
Date and such Transaction
will not be less
than the amount payable by Party B to such third party in consideration
of
entering into such replacement
transaction.
|
2
(k) Payments
on Early
Termination Due to Certain Events. Notwithstanding
Section
6, so longas
(A) an Additional Termination Event
occurs pursuant to Part 1(m)(v)
or (vi), or (B) Party Ais
the Affected Party in respect of a
Tax Event Upon Merger or the Defaulting Party in respect of any Event of Default,
paragraphs (i)
to (ix) below will
apply:
(i) For
the purposes of Section 6(d)(i),
Party B's obligation with respect to the extent of information to be provided
with its calculations is limited to information Party B has already received
in
writing which Party B is able to release without breaching any contractual
obligations or the provisions of any law applicable to Party
B.
(ii) The
definition of "Market Quotation"
shall be deleted in its entirety and replaced with the
following:
"Market
Quotation" means, with respect to one or more Terminated
Transactions, a Firm Offer which is (1) made by a Reference Market-maker that
is
an Eligible Replacement, (2) for an amount that would be paid to Party B
(expressed as a negative number) or by Party B (expressed as a positive number)
in consideration of an agreement between Party B and such Reference Market-maker
to enter into a transaction (the "Replacement
Transaction") that would have the effect of preserving for such
party the economic equivalent of any payment or delivery (whether the underlying
obligation was absolute or contingent and assuming the satisfaction of each
applicable condition precedent) by the parties under Section 2(a)(i) in respect
of such Terminated Transactions or group of Terminated Transactions that would,
but for the occurrence of the relevant Early Termination Date, have been
required after that Date, (3) made on the basis that Unpaid Amounts in respect
of the Terminated Transaction or group of Transactions are to be excluded but,
without limitation, any payment or delivery that would, but for the relevant
Early Termination Date, have been required (assuming satisfaction of each
applicable condition precedent) after that Early Termination Date is to be
included and (4) made in respect of a Replacement Transaction with commercial
terms substantially the same as those of this Agreement (save for the exclusion
of provisions relating to Transactions that are not Terminated
Transactions)."
3
(iii) The
definition of "Settlement Amount" shall be deleted in its entirety and replaced
with the following:
"Settlement
Amount"
means, with respect to any Early Termination Date, an amount (as determined
by
Party B) equal to:
(A)
|
If
a Market Quotation for the
relevant Terminated Transaction or group of Terminated Transactions
is
accepted by Party B
so as to become legally binding on or before the day falling ten
Local
Business Days after the day on which the Early Termination Date is
designated (or such later day as Party B may specify in writing to
Party
A, which in any event will not be later than
the Early Termination Date)
(such day, the "Latest
Settlement
Amount Determination Day"),
the Termination Currency
Equivalent of the amount (whether positive or negative) of such Market
Quotation; or
|
(B)
|
If
no Market Quotation for the
relevant Terminated Transaction
or group of Terminated
Transactions is accepted by Party B so as to become legally binding
on or
before the Latest Settlement Amount Determination Day, Party B's
Loss
(whether positive or negative and without reference to any Unpaid
amounts)
for
the relevant Terminated
Transaction or group of Terminated
Transactions."
|
(iv) For
the purpose of paragraph (4) of the
definition of Market Quotation, Party B shall determine in its sole discretion,
acting in a commercially reasonable manner, whether a Firm Offer is made in
respect of a
Replacement Transaction with commercial terms substantially the same as those
of
this Agreement (save for the exclusion of provisions relating to Transactions
that are not Terminated Transactions).
(v) Party
B undertakes to use its reasonable
efforts to obtain
at least one Market Quotation before the Latest Settlement Amount Determination
Day.
(vi) Party
B will be deemed to have
discharged its obligations under (v) above if it requests Party A to obtain
Market Quotations, where
such request is made in writing within two Local Business Days after the day
on
which the Early Termination Date is designated.
(vii) If
Party B requests Party A in writing
to obtain Market Quotations, Party A shall use its reasonable efforts to do
so before the Latest
Settlement Amount Determination Day.
(viii) Any
amount calculated as being due in
respect of an Early Termination Date will be payable in accordance with Section
6(d)(ii), provided that if such payment is owed to Party B, it will be
payable on the day that
notice of the amount payable is given to Party A.
(ix) If
the Settlement Amount is a negative
number, Section 6(e)(i)(3) of this Agreement will be deleted in its entirety
and
replaced with the following:
"Second
Method and Market
Quotation.
If Second Method and Market Quotation
apply, (1) Party B shall pay to Party A an amount equal to the absolute value
of
the Settlement Amount in respect of the Terminated Transactions, (2) Party
B
shall pay to Party A the Termination Currency Equivalent of the Unpaid Amounts
owing to Party A
and (3) Party A shall pay to Party B the Termination Currency Equivalent of
the
Unpaid Amounts owing to Party B, provided that, (i) the amounts payable under
(2) and (3) shall be subject to netting in accordance with
Section 2(c) of this Agreement and
(ii) notwithstanding any other provision of this Agreement, any amount payable
by Party A under (3) shall not be netted-off against any amount payable by
Party
B under (1)."
4
(l) "Termination
Currency"
means
United States Dollars.
(m) Additional
Termination
Events. Each of
the following will
constitute an AdditionalTermination Event pursuant
to Section
5(b)(v):
(i) Any
acceleration of the Notes pursuant to Section
5.02 of the
Indenture (provided such acceleration has not been rescinded pursuant
to Section
5.02 of the Indenture) and liquidation of the Trust Estate, with Party
B as the sole
Affected Party;
|
(ii)
|
Any
amendment or supplement to the
Basic Documents
(collectively, the "Trust
Documents")
that would
materially adversely
affect any of Party A's rights or obligations under this Agreement,
any
Transaction or any Trust Document, that is made without the consent
of
Party A, which consent will not be unreasonably withheld or conditioned;
provided that Party A's consent
will be deemed to have been
given if Party A does not object in writing within 10 Business Days
of
receipt of a written request for such consent, with Party B as the
sole
Affected Party; and
|
(iii) Failure
of Party A to comply with the
requirements of Part 5(n),
with Party A as thesole
Affected Party;
(iv) Xxxxx'x
First Rating
Triggers. Failure
of Party A to comply with the
requirements of Part 5(o)(i i),
with Party A as the sole Affected
Party;
(v) Xxxxx'x
Second Rating
Triggers.
(A)
Failure
of Party A to comply with the
requirements of
Part 5(o)(iv), with Party A as the sole Affected Party;
(B)
(1)
The Xxxxx'x Second Rating
Trigger
Requirements apply and 30 or more Local Business Days have elapsed since the
last time the Xxxxx'x
Second Rating Trigger Requirements did not
apply and (2)(a)
at least one Eligible Replacement has made a Firm Offer (which remains capable
of becoming legally binding upon acceptance) to be the transferee of a transfer
to be made in accordance with Part 5(p)(ii) below or (b) at
least one entity meeting at least the
Xxxxx'x Second Trigger
Required Ratings has made a Firm Offer (which remains capable of becoming
legally binding upon
acceptance by the offeree) to provide an Eligible Guarantee in respect of all
of
Party A's present
and future obligations under this
Agreement, with Party A as the sole Affected Party;
|
(vi)
|
S&P
Downgrade of Party A.
Failure of Party A to comply with the requirements of Part 5(t),
with
Party A as the sole Affected
Party.
|
|
(vii)
|
Regulation
AB Financial
Disclosure. The
following shall constitute an Additional Termination Event in which
Party
A shall be the sole Affected Party: the failure of Party A to comply
with
or perform any agreement or undertaking to be complied with or performed
by Party A under Part
5(u) of this
Agreement.
|
5
2.
|
Tax
Representations.
|
a.
|
Payer
Tax
Representations. For
the purpose of
Section 3(e), each of Party A and Party B makes the following
representation:
|
It
is not required by any applicable
law, as modified by the practice of any relevant governmental revenue authority,
of any Relevant Jurisdiction to make any deduction or withholding for or on
account of any Tax from any payment (other than interest under Section 2(e),
6(d)(ii) or 6(e)) to be made by it to the other party under this
Agreement. In making this representation, it may rely on (i) the
accuracy of any representation made by the other party pursuant to Section
3(f),
(ii) the satisfaction of the agreement contained in Section 4(a)(i) or 4(a)(iii)
and the accuracy and effectiveness of any document provided by the other party
pursuant to Section 4(a)(i) or 4(a)(iii), and (iii) the satisfaction of the
agreement of the other party contained in Section 4(d), provided that it will
not be a breach of this representation where reliance is placed on clause (ii)
above and the other party does not deliver a form or document under Section
4(a)(iii) by reason of material prejudice to its legal or commercial
position.
b.
|
Payee
Tax
Representations. For
the purpose of
Section 3(f):
|
i.
|
Party
A makes the following
representations: It is a corporation organized under the laws
of the State of Delaware.
|
ii.
|
Party
B makes the following
representations: It is a Delaware
statutory trust
organized or formed under the laws of the State of Delaware.
|
3.
|
Agreement
to Deliver
Documents.
|
a.
|
For
purposes of Sections 4(a)(i)
and (ii), each party agrees to deliver the following documents, as
applicable:
|
Party
required to deliver
document
|
Form/Document/Certificate
|
Date
by which to be
delivered
|
||
Party
A and Party
B
|
Any
form or document that may be
required or reasonably requested in order to allow the other party
to make
a payment under this Agreement without any deduction or withholding
for or
on account of any Tax or with such deduction or withholding at a
reduced
rate.
|
On
the date of this Agreement, and
promptly upon the earlier of (i) reasonable demand by the other party
and
(ii) learning that the form or document is required.
|
b.
|
Other
documents to be delivered
are:
|
6
Party
required to deliver
document
|
Form/Document/Certificate
|
Date
by which to be
delivered
|
Covered
by Section 3(d)
Representation
|
|||
Party
A and Party
B
|
Certificate
or other documents
evidencing the authority of the party entering into this Agreement
or a
Confirmation, as the case may be, including copies of any board
resolutions and appropriate certificates of incumbency as to the
officers
executing such documents.
|
At
or promptly following the
execution of this Agreement.
|
Yes
|
|||
Party
A and Party
B
|
Opinions
of counsel re: corporate
matters and enforceability of this Agreement in form and substance
acceptable to the other party.
|
At
or promptly following the
execution of this Agreement.
|
No
|
|||
Party
A
|
Guarantee
by Credit Support
Provider.
|
At
or promptly following the
execution of this Agreement.
|
No
|
|||
Party
A
|
Legal
opinion re: enforceability
of guarantee in form and substance satisfactory to Party
B.
|
At
or promptly following the
execution of this Agreement.
|
No
|
|||
Party
B
|
Monthly
Servicer
Reports.
|
As
required pursuant to Section
5.06 of the Sale and
Servicing Agreement.
|
No
|
4.
|
Miscellaneous
|
a.
|
Addresses
for
Notices:
|
For
the purpose of Section 12(a),
notices will be delivered to the address or facsimile number specified in the
Confirmation of such Transaction.
(1) TO
PARTY
A:
Address
for notices or communications to Party
A in respect of
Section 5(a)(i) shall be sent to:
Xxxxxxx
Xxxxx World Headquarters
4
World Financial Xxxxxx, 00xx Xxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Attention:
Swap Group
Facsimile
No.: 000
000-0000
Telephone
No.:
000
000-0000
7
In
addition, in the case of notices or
communications relating to Section 5, 6, 11 or 13 of this Agreement, a second
copy of any such notice or communication shall be addressed to the attention
of
Party A's legal department as follows:
GMI
Counsel
Xxxxxxx
Xxxxx World Headquarters
4
World Financial Xxxxxx, 00xx Xxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Attention: Swaps
Legal
Facsimile
No.: 000
000-0000
(2)
TO PARTY B:
Caterpillar
Financial Asset Trust 2007-A
c/o
The
Bank of New York (Delaware)
000
Xxxxx
Xxxx Xxxxxx, Xxxxx 000
Xxxxxx,
Xxxxxxxx 00000
Attention:
Corporate Trust Administration
Facsimile
No.: 000-000-0000
Telephone
No.: 000-000-0000
With
a copy to:
Caterpillar
Financial Services Corporation
0000
Xxxx
Xxx Xxxxxx
Xxxxxxxxx,
Xxxxxxxxx 00000-0000
Attention:
Caterpillar Financial Asset Trust 2007-A
Facsimile
No.: 000-000-0000
Telephone
No.: 000-000-0000
b.
|
Process
Agent. For
the purpose of
Section 13(c):
|
Party
A appoints as its Process
Agent: Not applicable
Party
B appoints as its Process
Agent: Not applicable.
c.
|
Offices. The
provisions of
Section 10(a) will apply.
|
d.
|
Multibranch
Party. For
the purpose of
Section 10:
|
i.
|
Party
A is not a Multibranch
Party.
|
ii.
|
Party
B is not a Multibranch
Party.
|
e.
|
Calculation
Agent. The
Calculation Agent
is Party B.
|
8
f.
|
g.
|
Single
Agreement.
Section 1(c) will be amended by
the addition of the
words ", the credit support annex entered into between Party A and
Party B
in relation to this Master Agreement" after the words "Master
Agreement".
|
h.
|
Netting
of
Payments. Subparagraph
(ii) of
Section 2(c) will apply to all Transactions
under this
Agreement.
|
i.
|
"Affiliate"
will
have the meaning specified in
Section 14;
provided
that Party B shall be deemed to
have no Affiliates.
|
j.
|
Waiver
of Jury
Trial. Each
party waives, to
the fullest extent permitted by applicable law, its right to have a
jury trial in respect
to any proceedings related to this Agreement. Each party (i)
certifies that no representative, agent or attorney of the other
party has
represented, expressly or otherwise, that such other party would
not, in
the event of such
a suit, action or proceeding,
seek to enforce the foregoing waiver and (ii) acknowledges that it
and the
other party have been induced to enter into this Agreement by, among
other
things, the mutual waivers and certifications in this
Section.
|
k.
|
The
definition of "Local
Business
Day"
in
Section 14 will be amended by the addition of the words "or any Credit
Support Document" after "Section 2(a)(i)" and the addition of the
words
"or Credit Support Document" after
"Confirmation".
|
5.
|
Other
Provisions.
|
a.
|
Non-Reliance. In
connection with the negotiation
of, the entering into, and the execution of this Master Agreement,
any
Credit Support Document to which it is a party, each Transaction
and any
other documentation relating to this Master Agreement to which it
is a
party or that
is
required by this Master Agreement to deliver, each of Party A and
Party B
represents and agrees that:
|
i.
|
it
is not relying (for the
purposes of making any investment decision or otherwise) upon any
advice,
counsel or representations (whether written or oral)
of the other party
to this Master Agreement, such Credit Support Document, each Transaction
or such other documentation other than the representations expressly
set
forth in this Master Agreement, such Credit Support Document and
in any
Confirmation;
|
ii.
|
it
has consulted with its own
legal, regulatory, tax, business, investment, financial and accounting
advisors to the extent it has deemed necessary, and it has made its
own
investment, hedging and trading decisions (including decisions
regarding the
suitability of any Transaction pursuant to this Master Agreement)
based
upon its own judgment and upon any advice from such advisors as it
has
deemed necessary and not upon any view expressed by the other party
to
this Master Agreement, such Credit Support
Document, each Transaction
or such other documentation;
|
iii.
|
it
has a full understanding of all
the terms, conditions and risks (economic and otherwise) of the Master
Agreement, such Credit Support Document, each Transaction and such
other
documentation and is
capable of assuming and willing to, and will, assume (financially
and
otherwise) those risks;
|
9
iv.
|
it
is an "eligible contract
participant" as defined in Section 1a(12) of the Commodity Exchange
Act (7
U.S.C. 1a), as amended by the Commodity Futures Modernization Act
of
2000;
|
v.
|
it
is entering into this Master
Agreement, such Credit Support Document, each Transaction and such
other
documentation for the purposes of managing its borrowings or investments,
hedging its underlying assets or liabilities or in connection with
a line of
business;
|
vi.
|
it
is entering into this Master
Agreement, such Credit Support Document, each Transaction and such
other
documentation as principal, and not as agent or in any other capacity,
fiduciary or otherwise; and
|
vii.
|
the
other party to this Master
Agreement, such Credit
Support Document, each Transaction and such other documentation (a)
is not
acting as a fiduciary or financial, investment or commodity trading
advisor for it, (b) has not given to it (directly or indirectly through
any other
person) any assurance, guaranty
or representation whatsoever as to the merits (either legal, regulatory,
tax, financial, accounting or otherwise) of this Master Agreement,
such
Credit Support Document, each Transaction or such other documentation,
and
(c)
has not committed to unwind the
Transactions.
|
b.
|
Tax
|
i.
|
Notwithstanding
the definition of
"Indemnifiable Tax" in Section 14 of this Agreement, in relation
to
payments by Party A, any Tax shall be an Indemnifiable Tax and, in
relation to payments by Party B, no Tax shall
be an Indemnifiable
Tax.
|
ii.
|
Section
2(d)(i)(4) of this
Agreement shall be deleted in its entirety and replaced with the
words "if
such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment
which Y is otherwise entitled under this Agreement, such
additional amount as
is necessary to ensure that the net amount actually received by Y
(free
and clear of Indemnifiable Taxes, whether against X or Y) will equal
the
full amount Y would have received had no such deduction or withholding
been required".
|
iii.
|
Section
2(d)(i)(4) of this
Agreement shall not apply to Party B as X, and Section 2(d)(ii) shall
not
apply to Party B as Y, in each case such that Party B shall not be
required to pay any additional amounts referred to
therein.
|
c.
|
Additional
Representation
by Party
A. Section
3 is
amended by adding the following additional representation by Party
A
only:
|
"(h) Pari
Passu. Its obligations
under this
Agreement rank pari passu with all of its other unsecured, unsubordinated
obligations except those obligations preferred
by operation of
law."
10
d.
|
No
Petition. Party
A covenants and
agrees that prior to the date that is one year and one day (or, if
later,
the expiration of all applicable preference periods under the United
States Bankruptcy Code or other applicable law)
after the payment
in full of all Notes,
and all distributions to all Holders and all Securities, it will
not
institute against, or join with any other Person in instituting against,
Party B or Caterpillar Financial Funding Corporation any bankruptcy,
reorganization,
arrangement, insolvency or liquidation proceedings or other proceedings
under United States federal or state bankruptcy or similar law in
connection with any obligations under this Agreement. The
provisions of this paragraph will
survive the termination of this
Agreement.
|
e.
|
Limited
Recourse;
Subordination.
|
i.
|
Notwithstanding
anything to the
contrary contained in this Agreement, the obligations of Party B
under
this Agreement and any Transaction hereunder are solely the obligations
of Party B and
will
be payable solely to the extent of funds received by and available
to
Party B in accordance with the priority of payment provisions under
the
Sale and Servicing Agreement and the Indenture and on the Distribution
Dates specified therein.
Party A acknowledges that Party B
has pledged its assets constituting the Collateral
to the Indenture
Trustee. Upon exhaustion of the assets of Party B and the
proceeds thereof in accordance with the Sale and Servicing Agreement
and
the Indenture,
Party A
will not be entitled to take any
further steps against Party B to recover any sums due but unpaid
hereunder
or thereunder, all claims in respect of which will be
extinguished. No recourse may be taken for the payment of any
amount owing in respect of any
obligation of, or claim against,
Party B arising out of or based upon this Agreement or any Transaction
against any holder of a beneficial interest, employee, officer or
Affiliate of Party B and, except as specifically provided in this
Agreement, no recourse
may be taken or the payment
of any amount owing in respect of any obligation of, or claim against,
Party B based on or arising out of this Agreement or against Caterpillar
Financial Funding Corporation, Caterpillar Financial Services Corporation
or any
stockholder, holder of a
beneficial interest, employee, officer, director, incorporator or
Affiliate of such person; provided, however, that the foregoing will
not
relieve any such person or entity from any liability they might otherwise
have as a result
of their gross negligence or
willful misconduct.
|
ii.
|
The
parties intend that
Part
5(e)(iv) of this
Schedule constitute an enforceable subordination agreement under
Section
510(a) of the Bankruptcy Code and will survive the termination of
this
Agreement.
|
f.
|
Party
B
Pledge. Notwithstanding
Section 7 to the
contrary, Party A acknowledges that (i) Party B will pledge its rights
under this Agreement to the Indenture Trustee for the benefit of
the
Noteholders and the Swap Counterparties pursuant to the Indenture
and
agrees to such
pledge
and (ii) Party A (as a Secured Party under the Indenture)
has no voting rights in
connection with any action to be taken on behalf of the Secured Parties.
The Indenture Trustee will not be deemed to be a party to this Agreement,
provided,
however, the Indenture
Trustee, acting on behalf of the holders of the Notes, will
have the right to
enforce this Agreement against Party A. Party A will be
entitled to rely on any notice or communication from the Indenture
Trustee
to that effect. Party
A acknowledges that Party B
will pledge substantially all its assets to the Indenture Trustee
for the
benefit of the Noteholders and Party A and that all payments hereunder,
including payments on early termination, will be made in accordance
with
the priority
of payment provisions of
the Sale and Servicing Agreement and the Indenture and on the Distribution
Dates specified therein.
|
11
g.
|
Severability. If
any term,
provision, covenant, or condition of this Agreement, or the application
thereof to any party or circumstance,
will be held to be
invalid or unenforceable (in whole or in part) for any reason, the
remaining terms, provisions, covenants, and conditions hereof will
continue in full force and effect as if this Agreement had been executed
with the invalid
or unenforceable portion
eliminated, so long as this Agreement as so modified continues to
express,
without material change, the original intentions of the parties as
to the
subject matter of this Agreement and the deletion of such portion
of this
Agreement
will not substantially impair
the respective benefits or expectations of the parties to this
Agreement.
|
h.
|
Recording
of
Conversations. Each
party (i)
consents to the recording of the telephone conversations of the trading
and marketing personnel of the parties in
connection with this
Agreement and any potential or actual Transaction and (ii) agrees
to
obtain any necessary consent of, and to give notice of such recording
to,
its personnel.
|
i.
|
Consent
by Party A to
Amendments to Certain Documents. Before
any amendment,
modification or
supplement is made to the Trust Documents that (i) would materially
adversely affect any of Party A's rights or obligations under the
Trust
Documents, this Agreement or any Transaction or (ii) modify the
obligations or impair the
ability of Party B to fully
perform any of Party B's obligations under the Trust Documents, this
Agreement or any Transaction in such a way that materially adversely
affects any of Party A's rights or obligations under this Agreement
or any
Transaction, Party
B will provide Party A with
a copy of the proposed amendment, modification or supplement and
will
obtain the consent of Party A prior to its adoption, which consent
will
not be unreasonably withheld or conditioned, provided that
Party A's consent
will be deemed
to
have been given if Party A does not object in writing within 10 Business
Days of receipt of a written request for such
consent.
|
j.
|
No
Set-off.
|
|
(i)
|
All
payments under this Agreement
will be made without set-off or counterclaim, except as expressly
provided
for in Section 2(c), Section 6 or Part
1(k)(ix).
|
(ii)
|
Section
6(e) will be amended by
the deletion of the following sentence; "The amount,
if any, payable in
respect of an Early Termination Date and determined pursuant to this
Section will be subject to any
Set-off."
|
k.
|
Limitation
of
Liability of Owner Trustee. Notwithstanding
anything contained in this Agreement to the contrary, this instrument
(and
any Confirmation pursuant to this instrument) has been or will be
signed
on behalf of Party B by The Bank of New
York (Delaware) not
in its individual capacity but solely in its capacity as Owner Trustee
of
Party B and in no event will The Bank of New York (Delaware) in its
individual capacity or any beneficial owner of Party B have any liability
for the
representations, warranties,
covenants, agreements or other obligations of Party B hereunder or
under
any such Confirmation, as to all of which recourse will be had solely
to
the assets of Party B. For all purposes of this Agreement and
any Confirmation,
in the performance of any duties
or obligations of Party B under this Agreement, the Owner Trustee
will be
subject to, and entitled to the benefits of, the terms and provisions
of
the Trust Agreement; provided, however, that the foregoing will not
relieve
the Owner Trustee from any
liability it might otherwise have under the Trust Agreement as a
result of
its gross negligence or willful
misconduct.
|
12
l.
|
Definitions. Unless
otherwise
specified in this Schedule or in a Confirmation, this Agreement and
the
relevant Transaction
between the parties are subject to the 2000 ISDA Definitions (the
"Definitions"), as published by the International Swaps and Derivatives
Association, Inc., and will be governed in all relevant respects
by the
provisions set forth in the Definitions,
without regard to any
amendment to the Definitions subsequent to the date hereof. The
provisions of the Definitions are incorporated by reference in and
will be
deemed a part of this Agreement, except that references in the Definitions
to a "Swap
Transaction" will be deemed
references to a "Transaction" for purposes of this
Agreement. In the event of any inconsistency between the
provisions of this Agreement and the Definitions, this Agreement
will
prevail. In the event of any inconsistency between
the provision of any
Confirmation and this Agreement or the Definitions, such Confirmation
will
prevail for the purpose of the relevant
Transaction.
|
For
the purpose of this
Agreement:
"Credit
Support
Annex" means
any credit support annex entered into between Party A and
Party B relating
to this Agreement, as amended, supplemented or otherwise modified from time
to
time.
"Credit
Support
Document"
means the Credit Support Annex and any Eligible Guarantee for Party
A.
"Credit
Support
Provider"
means in relation to Party A,
(1) Party A in its
capacity as a party to the Credit Support Annex and (2) the guarantor under
any
Eligible Guarantee, and in relation to Party B, Party B in its capacity as
a
party to the Credit Support Annex.
"Eligible Guarantee"
means an unconditional
and irrevocable
guarantee that is provided by a guarantor as principal debtor rather
than surety
and is directly enforceable by Party B, where either (A) a law firm has given
a
legal opinion confirming that none of the guarantor's payments
to Party B under such guarantee
will be subject to withholding for tax or (B) such guarantee provides that,
in
the event that any of such guarantor's payments to Party B are subject to
withholding for tax, such guarantor is required to pay such additional
amount as is necessary to ensure
that the net amount actually received by Party B (free and clear of any
withholding tax) will equal the full amount Party B would have received had
no
such withholding been required.
"Eligible
Replacement"
means a Financial
Institution (i)(A) having the Xxxxx'x First Trigger Required Ratings and/or
the
Xxxxx'x Second Trigger Required Ratings or (B) whose present and future
obligations owing to Party B are guaranteed pursuant to an Eligible Guarantee
provided by a guarantor
having the Xxxxx'x First Trigger
Required Ratings and/or the Xxxxx'x Second Trigger Required Ratings, and (ii)(A)
having the S&P's First Rating Thresholds and/or the S&P's Second Rating
Thresholds or (B) whose present and future obligations owing to Party
B are guaranteed pursuant to an
Eligible Guarantee provided by a guarantor having the S&P's First Rating
Thresholds and/or the S&P's Second Rating Thresholds.
13
"Financial
Institution"
means a bank, broker/dealer, insurance company, structured
investment vehicle or
derivative product company or Xxxxxxx Xxxxx & Co., Inc.
"Firm
Offer" means
an offer which, when made, was capable of becoming legally binding upon
acceptance.
"Xxxxx'x
Short-term
Rating" means
a rating assigned by Xxxxx'x under its short-term rating scale in respect
of an entity's
short-term, unsecured and unsubordinated debt obligations
"Relevant
Entities"
means Party A and any guarantor under an Eligible Guarantee in respect of all
of
Party A's present and future obligations under this Agreement.
m.
|
Additional
Defined
Terms. Capitalized
terms used but not
defined in this Agreement (including this Schedule) or any Confirmation
are defined in the
"Basic
Documents"
(as such term is defined in the
indenture, dated as of September 1, 2007 (the "Indenture"),
between Party B and U.S. Bank
National Association, as indenture
trustee.
|
n.
|
Downgrade
or
Withdrawal of Party
A's
Rating
by
Fitch. In
the event that
Party A's short term unsecured debt rating is withdrawn or reduced
below
"F1" by Fitch or long term unsecured and
unsubordinated debt
rating is withdrawn or reduced below "A" by Fitch (such rating
thresholds, the
"Approved
Rating
Thresholds"),
within 30 days of such
rating downgrade
(unless each such Rating Agency
has reconfirmed the rating of each Class
of
the Notes which was in effect
immediately prior to such downgrade), Party A
will (i) assign each
Transaction to another counterparty with the Approved Rating Thresholds
and approved by Party B (which approval will not be
unreasonably withheld)
on terms identical
to this Schedule and the
related Confirmation, (ii) obtain a guaranty, or a contingent agreement
of, another person with Approved Rating Thresholds to honor Party
A's
obligations under this Agreement, provided that such other person
is
approved by
Party B (which approval will
not be unreasonably
withheld), (iii) post xxxx-to-market
collateral, pursuant to a
collateral support agreement acceptable to Party B, which will be
sufficient to restore any downgrade in the ratings of each Class
of the Notes
issued by Party B attributable
to Party
A's failure
to comply
with the Approved Rating Thresholds, or (iv) establish any other
arrangement satisfactory to Party B and to the applicable Rating
Agency,
in each case, sufficient to satisfy the Rating Agency Confirmation. However,
Party A will be required to take the action described in clause (i),
(ii)
or (iv) above, in any event within 10 Business Days of such failure,
if
Party A fails to have a short-term
unsecured debt rating
of at least "F2" by Fitch or a
long-term unsecured debt rating
of at least "BBB+" by Fitch. All costs and expenses in
connection with effecting any arrangements pursuant to clauses (i),
(ii),
(iii) or (iv) will be
borne by Party A.
|
o.
|
Downgrade
or Withdrawal of
Party A's Rating
by
Xxxxx'x.
|
(i) An
entity shall have the "Xxxxx'x First
Trigger Required
Ratings" (A)
where such entity is the subject of a Xxxxx'x Short-term Rating, if such rating
is "Prime-1" and its long-term, unsecured and unsubordinated debt obligations
are rated "A2" or above by
Xxxxx'x and (B) where such entity is not the subject of a Xxxxx'x Short-term
Rating, if its long-term, unsecured and unsubordinated debt obligations are
rated "A1" or above by Xxxxx'x.
(ii) The
"Xxxxx'x First
Rating Trigger
Requirements"
shall apply so long as no Relevant Entity has the Xxxxx'x First Trigger
Required
Ratings. Within 30 Local Business Days after the Xxxxx'x First Rating
Trigger
Requirements apply, Party A will, at its own cost, (A) procure an Eligible
Guarantee in respect of all of Party A's present and future obligations under
this Agreement to be provided by a guarantor meeting the Xxxxx'x First Trigger
Required Ratings,
(B) effect a transfer in accordance with Part 5(p)(ii) below or (C) post
collateral in the amount and manner as set forth in the Credit Support
Annex.
14
(iii) An
entity shall have the "Xxxxx'x Second
Trigger Required
Ratings" (A)
where such entity is the subject of a Xxxxx'x Short-term Rating, if such rating
is "Prime-2" or above and its long-term, unsecured and unsubordinated debt
obligations are rated "A3" or above by Xxxxx'x and (B) where such entity is
not
the subject of a Xxxxx'x Short-term Rating, if its long-term, unsecured and
unsubordinated debt obligations are rated "A3" or above by
Xxxxx'x.
(iv) The
"Xxxxx'x
Second
Rating Trigger
Requirements"
shall apply so long as no Relevant Entity has the Xxxxx'x
Second Trigger Required
Ratings. Within 30 Local Business Days after the Xxxxx'x Second Rating
Trigger
Requirements apply, Party A will post collateral in the amount and manner as
set forth in the
Credit Support Annex. Party A will also, at its own cost, use
commercially reasonable efforts to, as soon as reasonably practicable, procure
either (A) an Eligible Guarantee in respect of all of Party A's present
and
future obligations under this Agreement
to be provided by a guarantor meeting at least the Xxxxx'x Second
Trigger Required Ratings or (B)
a transfer in accordance
with Part 5(p)(ii) below.
p.
|
Transfers
|
(i) Section
7 of this Agreement shall not
apply to Party A and,
subject to Section 6(b)(ii) and Part 5(p)(ii) below, Party A may not transfer
(whether by way of security or otherwise) any interest or obligation in or
under
this Agreement without the prior written consent of Party B.
(ii) Party
A may (at its own cost) transfer all or
substantially all
of its rights and obligations with respect to this Agreement to any other entity
(a "Transferee")
that is an Eligible Replacement,
provided, that
Party B shall determine in its sole
discretion, acting in a commercially reasonable manner,
whether or not a
transfer relates to all or substantially all of Party A's rights and obligations
under this Agreement. Following such transfer, all references to Party A shall
be deemed to be references to the Transferee; provided,
further,
that any transferee of Party
A's obligations under this Agreement shall become a party to this Agreement
and
pursuant to documentation that is not less favorable to Party B than this
Agreement, as determined in by the Administrator.
(iii) If
an entity has made a Firm
Offer (which
remains capable of becoming legally binding upon acceptance) to be the
transferee of a transfer to be made in accordance with (ii) above, Party B
shall
(at Party A's cost) at Party A's written request, take any
reasonable steps
required to be taken by it to
effect such transfer.
q.
|
Party
B
Agent. Party
A acknowledges
that Party B has appointed the Administrator
as its agent
under the Administration
Agreement to carry
out certain functions on behalf of Party B, and that the Administrator
shall be entitled to
give notices and to perform and satisfy the obligations of Party
B
hereunder on behalf of Party
B.
|
15
r.
|
Approval
of
Amendments, Transfers
or
Assignment. Notwithstanding
any
other provisions of this Agreement, no amendments to this Agreement
will be effected,
nor may the rights and obligations of Party A be transferred or assigned,
without the prior written confirmation of each Rating Agency that
such
amendment, transfer or assignment will not cause such Rating Agency
to
reduce or
withdraw its then current rating
on any of the Notes.
|
s.
|
Representations
to
Xxxxxxx Xxxxx & Co., Inc. Party
B makes the
same representations to and agreements with Xxxxxxx Xxxxx & Co., Inc.
as those made to and with Party A under Section 3(f), Sections 4(a)(i)
and
(iii) and Section 4(d) of the Agreement, at the times set forth therein,
except that references therein to "the party" will be deemed to be
references to Xxxxxxx Xxxxx & Co.,
Inc.
|
t.
|
Downgrade
or Withdrawal of Party A's Rating by
S&P.
|
(i) S&P's
First Rating Trigger. If no Relevant Entity (provided
that such Relevant Entity is a Financial Institution) has a short term unsecured
debt rating of "A-1" or better by S&P or, if no Relevant Entity (provided
that such Relevant Entity is a Financial Institution) has a short term unsecured
debt rating by S&P, a long term unsecured debt rating of "A+" or better by
S&P (such rating thresholds, the "S&P First Rating
Thresholds" and such failure to satisfy the S&P First Rating
Threshold, the "S&P First Rating Trigger") and the
S&P Second Rating Trigger has not occurred, then within 10 Local Business
Days of such failure (or on the date of this Agreement, if no Relevant Entity
has the S&P First Rating Thresholds as of the date of this Agreement), Party
A will, at its own cost, either (A) post collateral in the amount and manner
as
set forth in the Credit Support Annex, (B) procure an Eligible Guarantee in
respect of all of Party A's present and future obligations under this Agreement
to be provided by a guarantor having the S&P First Rating Thresholds and
which procurement will not be effective without the prior written confirmation
of S&P that such procurement will not cause S&P to reduce or withdraw
its then current rating on the Notes or (C) transfer its obligations to a
Financial Institution that satisfies the S&P First Rating Threshold in
accordance with Part 5(p)(ii) above.
(ii) S&P's
Second Rating Trigger. (A) If no Relevant Entity
(provided that such Relevant Entity is a Financial Institution) has a short
term
unsecured debt rating of "A-2" or better by S&P or, if no Relevant Entity
(provided that such Relevant Entity is a Financial Institution) has a short
term
unsecured debt rating by S&P, a long term unsecured debt rating of "BBB+" or
better by S&P (such rating thresholds with respect to any Relevant Entity
that is a Financial Institution, the "S&P Second Rating
Thresholds" and such failure to satisfy the S&P Second Rating
Threshold, the "S&P Second Rating Trigger") or
(B) if no Relevant Entity (provided that such Relevant Entity is
not a Financial Institution) has a short term unsecured debt
rating of "A-1" or better by S&P or, if no Relevant Entity (provided that
such Relevant Entity is not a Financial Institution) has a
short term unsecured debt rating by S&P, a long term unsecured debt rating
of "A+" or better by S&P (such rating thresholds with respect to any
Relevant Entity that is not a Financial Institution, the
"S&P Second Rating Thresholds" and such failure to
satisfy the S&P Second Rating Threshold, the "S&P Second
Rating Trigger"), then within 10 Local Business Days of such
failure, Party A will, at its own cost, post additional collateral in the amount
and manner as set forth in the Credit Support Annex. Party A will
also, at its own cost, within 60 calendar days of such failure, use commercially
reasonable efforts to procure either (A) an Eligible Guarantee in respect of
all
of Party A's present and future obligations under this Agreement to be provided
by a guarantor having the S&P First Rating Thresholds and which procurement
will not be effective without the prior written confirmation
of S&P that such procurement will not cause S&P to reduce or
withdraw its then current rating on the Notes or (B) transfer its obligations
to
a Financial Institution that satisfies the S&P First Rating Threshold in
accordance with Part 5(p)(ii) above.
16
(u)
|
Regulation
AB Financial Disclosure.
|
Subject
to the last two paragraphs of this Part 5 (u), so long as Party B,
Caterpillar Financial Funding Corporation (the
"Depositor") or any of such parties' Affiliates
(collectively, "Caterpillar") shall file reports in
respect of the Notes with the Securities and Exchange Commission (the
"SEC") pursuant to Sections 13(a) or 15(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act"), Party A agrees to Deliver within ten (10) calendar days of
receipt of a written request therefor by Party B or the Depositor, such
information relating to Party A as may be necessary to enable Caterpillar to
comply with any SEC disclosure requirements, including without limitation
information concerning Party A required by Items 1115 of Regulation AB and
Forms
8-K, 10-D and 10-K. To the extent necessary to comply with Regulation AB, Party
A shall obtain any necessary auditor's consents related to any financial
statements of Party A required to be incorporated by reference into any report
filed by Caterpillar with the SEC and promptly to forward to the Depositor
any
such auditor consents obtained. The information provided, or authorized to
be
incorporated by reference, by Party A pursuant to this Part 5(u) is referred
to
as the "Additional Information."
For
the purpose of this Part 5(u):
"Deliver"
includes actual delivery or transmission of information in an XXXXX-compatible
format or, in the case of any financial information required to be delivered
pursuant to Item 1115 of Regulation AB and Forms 8-K, 10-D and 10-K, making
such financial information available in an XXXXX-compatible format for
incorporation by reference to the extent permitted by Regulation AB, together
with actual delivery of all necessary auditor's consents.
"XXXXX"
means the SEC's Electronic Data Gathering, Analysis and Retrieval
system.
"Regulation
AB" means Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. §§229.1100-229.1123, as such may be amended from time to time,
and subject to such clarification and interpretation as have been provided
by
the SEC in the adopting release (Asset-Backed Securities, Securities Act Release
No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff of the
SEC, or as may be provided by the SEC or its staff from time to
time.
If
at any time during a period that reports are being filed with respect to Party
B
and the Notes in accordance with the Exchange Act and the rules and regulations
of the SEC, as reasonably calculated by the Depositor, the "aggregate
significance percentage" of this Agreement for any class of the Notes is 8%
or
more, Party A shall within five (5) Local Business Days following receipt of
request therefor provide the Additional Information required under Item
1115(b)(1) of Regulation AB for Party A. If Party A is unable to provide such
information, Party A shall within five (5) Local Business Days following receipt
of request therefor, at the sole expense of Party A, without any expense or
liability to the Depositor or Party B, either (i) post Eligible Collateral,
in
form, substance and amount satisfactory to the Depositor, in an amount
sufficient to reduce the aggregate significance percentage to 7% or
(ii) transfer its obligations to a Financial Institution that satisfies the
S&P First Rating Threshold and Xxxxx'x First Trigger Required Ratings in
accordance with Part 5(p)(ii) above to replace Party A as party to this
Agreement and which such entity has agreed to Deliver any information, report,
certification or accountants' consent when and as required under this Part
5(u)
hereof.
17
If
at any time during a period that reports are being filed with respect to Party
B
and the Notes in accordance with the Exchange Act and the rules and regulations
of the SEC, as reasonably calculated by the Depositor, the "aggregate
significance percentage" of this Agreement for any class of the Notes is 18%
or
more, Party A shall within five (5) Local Business Days following receipt of
request therefor provide the Additional Information required under Item
1115(b)(2) of Regulation AB for Party A. If Party A is unable to
provide such information, Party A shall within five (5) Local Business Days
following receipt of request therefor, at the sole expense of Party A, without
any expense or liability to the Depositor or Party B, transfer its obligations
to a Financial Institution that satisfies the S&P First Rating Threshold and
Xxxxx'x First Trigger Required Ratings in accordance with Part 5(p)(ii) above
to
replace Party A as party to this Agreement and which such entity has agreed
to
Deliver any information, report, certification or accountants' consent when
and
as required under this Part 5(u) hereof.
Party
A represents and warrants that the statements appearing under the heading the
caption "Description of the Notes - The Swap Counterparty" in the
Preliminary Prospectus Supplement dated September 17, 2007 related to the
issuance by Party B of the Notes and the Prospectus Supplement dated September
17, 2007 related to the issuance by Party B of the Notes (collectively,
"Prospectus Information") are true and correct in all
material respects and do not contain any untrue statement of a material fact
or
omit to state a material fact required to be stated therein or necessary to
make
the statements therein not misleading.
Party
A shall indemnify and hold harmless Caterpillar and each of Caterpillar's and
the directors, officers and any person controlling Caterpillar within the
meaning of the Securities Act of 1933, as amended (collectively, each, an
"indemnified party"), from and against any and all
losses, claims, damages and liabilities (including reasonable legal fees and
expenses) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus Information or in any Additional
Information or caused by any omission or alleged omission to state in the
Prospectus Information or any Additional Information, as applicable, a material
fact required to be stated therein or necessary to make the statements therein
not misleading. Promptly after the indemnified party under this Part
5(u) receives notice of the commencement of any such action, the
indemnified party will, if a claim in respect thereof is to be made pursuant
to
this Part 5(u), promptly notify Party A in writing of the commencement
thereof. In case any such action is brought against the indemnified
party, and it notifies Party A of the commencement thereof, Party A shall be
entitled to appoint counsel of Party A's choice at Party A's expense to
represent the indemnified party in any action for which indemnification is
sought (in which case Party A shall not thereafter be responsible for the fees
and expenses of any separate counsel retained by the indemnified party except
as
set forth below); provided, however, that such counsel shall
be reasonably satisfactory to the indemnified party. Notwithstanding Party
A's
election to appoint counsel to represent the indemnified party in an action,
the
indemnified party shall have the right to employ separate counsel (including
local counsel), and Party A shall bear the reasonable fees, costs and expenses
of such separate counsel if (i) such indemnified party shall have been advised
by such counsel that there may be one or more legal defenses available to it
which are different from or additional to those available to the indemnifying
party and in the reasonable judgment of such counsel it is advisable for such
indemnified party to employ separate counsel, (ii) a conflict or potential
conflict exists (based on advice of counsel to the indemnified party) between
the indemnified party and the indemnifying party, (iii) Party A shall not have
employed counsel reasonably satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after notice of the institution
of such action or (iv) Party A shall authorize the indemnified party to employ
separate counsel at the expense of Party A. Party A will not, without
the prior written consent of the indemnified party, settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified party
is an
actual or potential party to such claim or action) unless such settlement,
compromise or consent includes an unconditional release of each indemnified
party from all liability arising out of such claim, action, suit or
proceeding. No indemnified party will settle or compromise or consent
to the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution
may be sought hereunder without the consent of Party A, which consent shall
not
be unreasonably withheld.
[SIGNATURE
PAGE
FOLLOWS]
18
IN
WITNESS
WHEREOF, the
parties have executed this Schedule to the Master Agreement on the respective
dates specified below with effect from the date specified on the first page
of
this document.
CATERPILLAR
FINANCIAL
ASSET
TRUST
2007-A,
by
The
Bank of New York
(Delaware), not in its individual capacity but solely as Owner
Trustee
|
XXXXXXX
XXXXX CAPITAL SERVICES,
INC.
|
|
By:
/s/
Xxxxxxxx X.
Xxxxx
By: _/s/
Xxxxxxx X.
Kershaw_______________
Name:
Xxxxxxxx X.
Xxxxx
Name: Xxxxxxx X.
Xxxxxxx
Title: Vice
President
Title:
Date: Date:
[Signature
Page to ISDA Schedule]
Elections
and Variables
to
the 1994 ISDA Credit Support Annex
to
the Schedule to the ISDA Master Agreement dated as of September 27,
2007
between
Party A and Party B
dated
September 27, 2007
between
XXXXXXX
XXXXX CAPITAL SERVICES,
INC.,
a
Delaware
corporation
("Party
A")
and
CATERPILLAR
FINANCIAL ASSET TRUST
2007-A,
a
Delaware Statutory
Trust
("Party
B")
This
Annex supplements, forms part of,
and is subject to, the above-referenced ISDA Master Agreement (this
"Agreement"),
is part of its Schedule and is a Credit
Support
Document under this Agreement with respect to each party.
Accordingly,
the parties agree as
follows:—
Paragraphs
1 - 12. Incorporation
Paragraphs
1 through 12 inclusive of the ISDA Credit Support Annex (Bilateral Form) (ISDA
Agreements Subject to New York Law Only) published in 1994 by the International
Swaps and Derivatives Association, Inc. are incorporated herein by reference
and
made a part hereof.
Paragraph
13.Elections
and
Variables
(a)
|
Security
Interest for
"Obligations." The
term "Obligations"
as used in this Annex includes
the following additional
obligations:
|
With
respect to Party A:
None.
With
respect to Party B:
None.
(b)
|
Credit
Support
Obligations.
|
(i)
|
Delivery
Amount, Return Amount and
Credit Support
Amount.
|
(A)
|
"Delivery
Amount"
has the meaning specified in Paragraph 3(a), except that the words
"upon a
demand made by the Secured Party on or promptly following a Valuation
Date" shall be deleted and replaced by the words "on each Valuation
Date".
|
(B)
|
"Return
Amount"
has the meaning
specified in Paragraph 3(b).
|
(C)
|
"Credit
Support
Amount"
means the amount specified in (1), (2), (3) or (4) of this paragraph
(C)
below, except that if two or more amounts below apply, the higher
amount:
|
(1)
for any Valuation Date, if
the Xxxxx'x
First Rating Trigger Requirements
apply to
Party A, the following amount as determined by the Valuation Agent for such
Valuation Date: the sum of (i) the greater of (a) the Secured
Party's Exposure for such date and (b) 0 and (ii) the Notional Amount
on such Valuation
Date multiplied by the relevant
percentage set forth below in this clause (1) under the heading "Posting
Frequency (Weekly)" below.
Potential
Increase of Mid-Market
Valuation
|
|
Weighted
Average Life of Hedge in
Years
|
Posting
Frequency
(Weekly)
|
1
|
0.25%
|
2
|
0.50%
|
3
|
0.70%
|
(2)
for any Valuation Date, if the
Xxxxx'x Second Rating Trigger Requirements apply to Party A, the following
amount as determined by the Valuation Agent for such Valuation
Date: the sum of (i) the greater of (a) the Secured
Party's Exposure for such
date, (b) 0 and (c) the amount owed by Party A on the next Floating
Rate Payer Payment Date (as such term is defined in the Confirmation for the
Transaction under this Agreement) and (ii) the Notional Amount on such
Valuation Date multiplied
by the relevant percentage set
forth below in this clause (2) under the heading "Posting Frequency (Weekly)"
below.
Potential
Increase of Mid-Market
Valuation
|
|
Weighted
Average Life of Hedge in
Years
|
Posting
Frequency
(Weekly)
|
1
|
0.60%
|
2
|
1.20%
|
3
|
1.70%
|
(3)
for any Valuation Date, if the S&P First Rating Trigger occurs and the
S&P Second Rating Trigger has not occurred, within 10 Local Business Days of
such occurrence (or on the date of this Annex, if no Relevant Entity satisfies
the S&P First Rating Thresholds as of the date of this Annex), Party A will
post collateral in the following amount as determined by the Valuation Agent
for
such Valuation Date: the greater of (i) 100.0% of the Secured Party Exposure
for
such date and (ii) 0.
(4)
for any Valuation Date, if the S&P Second Rating Trigger occurs, within 10
Local Business Days of such occurrence, Party A will post collateral in the
following amount as determined by the Valuation Agent for such Valuation Date:
the greater of (i) 125.0% of the Secured Party Exposure for such date and (ii)
0.
(ii)
|
Eligible
Collateral.
The
following items will qualify
as "Eligible
Collateral" (unless
noted below) for Party
A:
|
2
The
following Valuation
Percentages will apply upon the occurrence of the respective event
below:
|
||||
Xxxxx'x
First Rating Trigger
Requirements
|
Xxxxx'x
Second Rating
Trigger Requirements
|
S&P
First Rating
Trigger
|
S&P
Second Rating
Trigger
|
|
(A) Cash
in U.S.
Dollars
|
100%
|
100%
|
100%
|
80%
|
(B) Fixed
rate negotiable debt
obligations issued by the U.S. Treasury Department having
a remaining maturity
of not more than one year
|
100%
|
100%
|
98%
|
78.4%
|
(C) Fixed
rate negotiable debt
obligations issued by the U.S. Treasury Department having a remaining
maturity of more than one year but not more than 2
years
|
100%
|
99%
|
98%
|
78.4%
|
(D) Fixed
rate negotiable debt
obligations issued by the U.S. Treasury Department having a remaining
maturity of more than 2 years but not more than 3
years
|
100%
|
98%
|
98%
|
78.4%
|
(E) Fixed
rate negotiable debt
obligations issued by the U.S. Treasury Department having a remaining
maturity of more
than 3 years but not more than 5 years
|
100%
|
97%
|
98%
|
78.4%
|
(F) Fixed
rate negotiable debt
obligations issued by the U.S. Treasury Department having a remaining
maturity of more than 5 years but not more than 7
years
|
100%
|
95%
|
92.6%
|
74.1%
|
(G) Fixed
rate negotiable debt
obligations issued by the U.S. Treasury Department having a remaining
maturity of more than 7 years but not more than 10
years
|
100%
|
94%
|
92.6%
|
74.1%
|
(H) Fixed
rate negotiable debt
obligations issued by the U.S. Treasury Department having
a remaining
maturity of more than 10 years but not more than 20
years
|
100%
|
89%
|
87.9%
|
70.3%
|
(I) Fixed
rate negotiable debt
obligations issued by the U.S. Treasury Department having a remaining
maturity of more than 20 years
|
100%
|
87%
|
84.6%
|
67.7%
|
(J) Floating
rate negotiable debt
obligations issued by the U.S. Treasury Department
|
100%
|
99%
|
Not
Eligible
Collateral
|
Not
Eligible
Collateral
|
(K) Fixed
rate U.S. Agency Debentures
having a remaining maturity of not more than one year
|
100%
|
99%
|
98%
|
78.4%
|
(L) Fixed
rate U.S. Agency Debentures
having a remaining maturity of more than one year but not more than
2
years
|
100%
|
98%
|
98%
|
78.4%
|
(M) Fixed
rate U.S. Agency Debentures
having a remaining maturity of more than 2 years but not more than
3
years
|
100%
|
97%
|
98%
|
78.4%
|
(N) Fixed
rate U.S. Agency Debentures
having a remaining maturity of more than 3 years but not more than
5
years
|
100%
|
96%
|
98%
|
78.4%
|
(O) Fixed
rate U.S. Agency Debentures
having a remaining maturity of more than 5 years but not more than
7
years
|
100%
|
94%
|
92.6%
|
74.1%
|
(P) Fixed
rate U.S. Agency Debentures
having a remaining maturity of more than 7 years but not more than
10
years
|
100%
|
93%
|
92.6%
|
74.1%
|
(Q) Fixed
rate U.S. Agency Debentures
having a remaining maturity of more than 10 years but not more than
20
years
|
100%
|
88%
|
82.6%
|
66.1%
|
(R) Fixed
rate U.S. Agency Debentures
having a remaining maturity of more than 20 years
|
100%
|
86%
|
77.9%
|
62.3%
|
(S) Floating
rate U.S. Agency
Debentures
|
100%
|
98%
|
Not
Eligible
Collateral
|
Not
Eligible
Collateral
|
(iii)
|
Thresholds.
|
3
(A)
|
"Independent
Amount"
means with respect to
Party
A: zero.
|
|
"Independent
Amount"
means
with respect to Party
B: zero.
|
(B)
|
"Threshold"
means with respect to Party
A: Infinity; provided that for so long as (i) no Relevant
Entity has the Xxxxx'x First Trigger Required Ratings and either
(x)
no Relevant
Entity
has had the Xxxxx'x First Trigger Required Ratings since this Annex
was
executed or (y) at least 30 Local Business Days have elapsed since
the
last time a Relevant Entity had the Xxxxx'x First Trigger Required
Ratings, or (ii) (x) no Relevant
Entity satisfies the S&P
First Rating Trigger and either (x) no Relevant Entity has satisfied
the
S&P First Rating Trigger since this Annex was executed or (y) at least
10 Local Business Days have elapsed since the last time a Relevant
Entity
satisfied
the S&P First Rating
Trigger, the Threshold with respect to Party A shall be
zero.
|
"Threshold"
means with respect to Party B:
infinity.
(C)
|
"Minimum
Transfer
Amount" means
U.S.$50,000.
|
(D)
|
Rounding. The
Delivery Amount will be
rounded up to the nearest integral multiple
of U.S.$10,000. The Return Amount will be rounded down to the
nearest integral multiple of
U.S.$10,000.
|
(c)
|
Valuation
and
Timing.
|
|
(i)
|
"Valuation
Agent" means Party A in all
circumstances.
|
|
(ii)
|
"Valuation
Date" means the first Local Business Day in each
week.
|
|
(iii)
|
"Valuation
Time" means the close of business in the city of the
Valuation Agent on the Local Business Day immediately preceding the
Valuation Date or date of calculation, as applicable, provided that
the
calculations of Value and Credit Support Amount will, as far as
practicable, be made as of approximately the same time on the same
date.
|
4
|
(iv)
|
"Value"
has the meaning specified in Paragraph 12, except that clause (i)
thereof
will be replaced in its entirety with the
following:
|
|
"(i) Eligible
Collateral or Posted Collateral that
is:
|
|
(A)
|
Cash,
the amount thereof multiplied by the applicable Valuation
Percentage but if more than one Valuation Percentage is
applicable, the Valuation Percentage with the lowest percentage;
and
|
|
(B)
|
a
security, the bid price obtained by the Valuation Agent multiplied
by the
applicable Valuation Percentage but if more than one Valuation Percentage
is applicable, the Valuation Percentage with the lowest
percentage;"
|
The
term "Valuation Percentage" shall mean the percentage specified under each
Rating Agency's name in the table in Paragraph 13(b)(ii).
(v) "Notification
Time" means
4:00 p.m., New York time, on a Local Business Day.
(d)
|
Conditions
Precedent
and Secured Party's Rights and
Remedies. The
following Termination
Event(s) will
be a
"Specified
Condition"
for the party specified (that
party being the Affected Party if the Termination Event occurs with
respect to that
party): None.
|
(e)
|
Substitution.
|
(i)
|
"Substitution
Date"
has
the
meaning specified in Paragraph
4(d)(ii).
|
(ii)
|
Consent. Not
applicable.
|
(f)
|
Dispute
Resolution.
|
(i)
|
"Resolution
Time"
means
4:00 p.m., New York time, on the Local Business Day following the
date on
which the notice is given that gives rise to a dispute under Paragraph
5.
|
(ii)
|
Value. For
the purpose of Paragraphs
5(i)(C) and 5(ii),
on
any date, the Value of the outstanding Posted Credit Support or of
any
transfer of Eligible Credit Support or Posted Credit Support, as
the case
may be, will be calculated as
follows:
|
(A) with
respect to any Eligible Credit Support or Posted Credit Support comprising
securities ("Securities") the sum of (a)(x) the last bid price
on such date for such Securities on the principal national securities exchange
on which such Securities are listed, multiplied by the applicable Valuation
Percentage; or (y) where any Securities are not listed on a national securities
exchange, the bid price for such Securities quoted as at the close of business
on such date by any principal market maker (which shall not be and shall be
independent from the Valuation Agent) for such Securities chosen by the
Valuation Agent, multiplied by the applicable Valuation Percentage; or (z)
if no
such bid price is listed or quoted for such date, the last bid price listed
or
quoted (as the case may be), as of the day next preceding such date on which
such prices were available, multiplied by the applicable Valuation Percentage;
plus (b) the accrued interest where applicable on such Securities (except to
the
extent that such interest shall have been paid to the Pledgor pursuant to
Paragraph 6(d)(ii) or included in the applicable price referred to in
subparagraph (a) above) as of such date; and
(B) with
respect to any Cash, the amount
thereof in U.S. dollars.
5
(iii)
|
Alternative. The
provisions of
Paragraph 5 will apply.
|
(g)
|
Holding
and
Using
Posted
Collateral.
|
(i)
|
Eligibility
to Hold
Posted Collateral; Custodians. A
Custodian of Party B will be
entitled to hold Posted Collateral on behalf of Party B pursuant
to
Paragraph 6(c) ,
provided that such Custodian satisfies the Custodian Required
Rating
Threshold. Party B's Custodian is the Indenture Trustee for
Party B. Initially, the Custodian for Party B is the U.S. Bank National
Association. If at any time the Custodian does not have credit
ratings from S&P at least equal to the Custodian Required
Rating Threshold, the Custodian
must within 60 days obtain a replacement Custodian with credit ratings
from S&P at least equal to the Custodian Required Rating
Threshold.
|
"Custodian
Required Rating
Threshold"
means, with respect to an entity, a short-term unsecured and unsubordinated
debt
rating from S&P of "A-1," or, if such entity does not have a short-term
unsecured and unsubordinated debt rating from S&P, a long-term unsecured and
unsubordinated debt rating from S&P of "A+".
(ii)
|
Use
of Posted
Collateral. Paragraph
6(c)(i) will not apply
to the Party B but Paragraph 6(c)(ii) will apply to Party
B.
|
(iii)
|
Notice. If
a party or its
Custodian fails to meet the criteria for eligibility to hold (or,
in the
case of a party, to use) Posted Collateral set forth in this Paragraph 13(g),
such party shall
promptly notify the other party of such
ineligibility.
|
(h)
|
Distributions
and Interest
Amount.
|
(i)
|
Interest
Rate.
The
"Interest
Rate"
will be the weighted average rate of interest earned by the Secured
Party
in respect of the portion of the
Posted Credit Support
comprised of cash.
|
(ii)
|
Transfer
of Interest
Amount. The
transfer of the Interest
Amount will be made on the second Local Business Day following the
end of
each calendar month and on any other Local Business Day on which
Posted Credit Support
in the form of cash is transferred to the Secured Party pursuant
to
Paragraph 3(b),
in each case to the extent
that a Delivery Amount would not be created or increased by that
transfer,
provided
that Party B shall not be obliged
to so transfer any
Interest Amount unless and until it has earned and received such
interest.
|
(iii)
|
Alternative
to
Interest Amount. The
provisions of Paragraph
6(d)(ii) will apply.
|
(iv)
|
"Distributions" means,
with respect
to any Eligible Credit Support comprised in the Posted Credit Support
consisting of
securities, all principal, interest and other payments and distributions
of cash or other property to which a holder of securities of the
same
type, nominal value, description and amount as such Eligible Credit
Support would have
received from time to
time.
|
(v)
|
"Distribution
Date" means,
with respect
to any Eligible Credit Support comprised in the Posted Credit Support
other than cash, each date on which a holder of such Eligible Credit
Support would have received Distributions or, if that
date is not a Local
Business Day, the next following Local Business
Day.
|
(i)
|
Additional
Representation(s).
|
There
are no additional representations
by either party.
6
(j)
|
Other
Eligible Support and
Other Posted Support.
|
(i)
|
"Value"
with
respect to Other Eligible Support
and Other Posted
Support shall have such meaning as the parties shall agree in writing
from
time to time.
|
(ii)
|
"Transfer"
with
respect to Other Eligible Support and Other Posted Support shall
have such
meaning as the parties shall agree in writing from time to
time.
|
(k)
|
Demands
and
Notices. All
demands, specifications and
notices under this Annex will be made pursuant to the Notices Section
of
this Agreement, save that any demand, specification or
notice:
|
(A) shall
be given to or made at the
following addresses:
If
to Party A:
Xxxxxxx
Xxxxx World Headquarters
4
World Financial Xxxxxx, 00xx Xxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Attention:
Swap Group
Facsimile
No.: 000
000-0000
Telephone
No.: 000
000-0000
If
to Party B: The
addresses set forth in the Schedule.
or
at such other address as the relevant
party may from time to time designate by giving notice (in accordance with
the
terms of this subparagraph) to the other party;
(C)
|
shall
be deemed to be effective at
the time such notice is actually received unless such notice is
received on a day
which is not a Local Business Day or after the Notification Time
on any
Local Business Day in which event such notice shall be deemed to
be
effective on the next succeeding Local Business
Day.
|
(l)
|
Addresses
for
Transfers.
|
Party
A: To be notified to Party
B
by Party A at the time of the request for the transfer.
Party
B: To be notified to
Party A by Party B upon request by Party A.
(m)
|
Other
Provisions.
|
|
(i)
|
Early
Termination
|
The
heading for Paragraph 7 shall be
deleted and replaced with "Early Termination" and the following shall be added
after the word "Default" in the first line of Paragraph 7, "in relation to
all
Transactions or a Termination Event in relation to all Transactions". Paragraph
7(iii) is hereby deleted.
|
(ii)
|
Costs
of Transfer on
Exchange
|
Notwithstanding
Paragraph 10, the
Pledgor will be responsible for, and will reimburse the Secured Party for,
all
transfer and other taxes and other costs involved in the transfer of Eligible
Credit Support either from the Pledgor to the Secured Party or from the Secured
Party to the Pledgor pursuant to Paragraph 4(d).
|
(iii)
|
Cumulative
Rights
|
The
rights, powers and remedies of the
Secured Party under this Annex shall be in addition to all rights, powers and
remedies given to the Secured Party by the Agreement or by virtue of any statute
or rule of law, all of which rights, powers and remedies shall be cumulative
and
may be exercised successively or concurrently without impairing the rights
of
the Secured Party in the Posted Credit Support created pursuant to this
Annex.
7
|
(iv)
|
Single
Pledgor and
Single Secured
Party
|
For
the avoidance of doubt Party A shall
always be the Pledgor and Party B shall always be the Secured
Party.
|
(v)
|
"Exposure"
has the meaning specified in
Paragraph 12, except that after the word "Agreement" the words "(assuming,
for this purpose only, that Part 1(l) of the Schedule is deleted)"
shall
be inserted.
|
(iii)
|
Additional
Defined
Terms. Capitalized
terms used but not
defined in this Annex have the meanings assigned to them in the Agreement
and the Schedule thereto. In the event of any inconsistency between
the
provisions of this Annex and the provisions in the Agreement or the
Schedule thereto, this Annex will
prevail.
|
(iv)
|
Transfer
timing. Paragraph
4(b) shall
be deleted and replaced with the
following:
|
Subject
to Paragraphs 4(a) and 5 and unless otherwise specified, any transfer of
Eligible Credit Support or Posted Credit Support (whether by the Pledgor
pursuant to Paragraph 3(a) or by the Secured Party pursuant to Paragraph 3(b))
shall be made not later than the close of business on the next Local Business
Day, provided that, in the case of any transfer of Posted Credit Support by
the
Secured Party pursuant to Paragraph 3(b), if the demand for the transfer of
Posted Credit Support is received by the Secured Party after the Notification
Time, then such transfer will be made not later than the close of business
on
the second Local Business Day thereafter.
|
(viii)
|
Limitation
of
Liability of Owner Trustee. Notwithstanding
anything contained
in
this Agreement to the contrary, this instrument (and any Confirmation
pursuant to this instrument) has been or will be signed on behalf
of Party
B by The Bank of New York (Delaware) not in its individual capacity
but
solely in its capacity as
Owner Trustee of Party B and in
no event will The Bank of New York (Delaware) in its individual capacity
or any beneficial owner of Party B have any liability for the
representations, warranties, covenants, agreements or other obligations
of
Party B hereunder
or under any such
Confirmation, as to all of which recourse will be had solely to the
assets
of Party B. For all purposes of this Agreement and any
Confirmation, in the performance of any duties or obligations of
Party B
under this Agreement, the Owner
Trustee will be subject to,
and entitled to the benefits of, the terms and provisions of the
Trust
Agreement; provided, however, that the foregoing will not relieve
the
Owner Trustee from any liability it might otherwise have under the
Trust
Agreement as
a result of its gross
negligence or willful
misconduct.
|
[SIGNATURE
PAGE
FOLLOWS]
8
IN
WITNESS
WHEREOF, the
parties have executed this Annex by their duly authorized representatives as
of
the date of the Agreement.
CATERPILLAR
FINANCIAL
ASSET
TRUST
2007-A,
by
The
Bank of New York
(Delaware), not in its individual capacity but solely as Owner
Trustee
|
XXXXXXX
XXXXX CAPITAL SERVICES,
INC.
|
|
By:
/s/
Xxxxxxxx X.
Xxxxx
By: __/s/
Xxxxxxx X.
Kershaw__________________
Name:
Xxxxxxxx X.
Xxxxx
Name: Xxxxxxx X.
Xxxxxxx
Title: Vice
President Title:
[Signature
Page to Credit Support Annex]
Date: September
27, 2007
To: CATERPILLAR
FINANCIAL ASSET TRUST
2007-A
Contact: The
Bank of New York (Delaware)
Fax.: 000-000-0000
Telephone: 000-000-0000
Attention: Corporate
Trust Administration
From: XXXXXXX
XXXXX CAPITAL SERVICES,
INC.
Contact: Marina
Lyutershteyn
Email: Xxxxxx_Xxxxxxxxxxxx@xx.xxx
Telephone: (000)
000-0000
Fax: (000)
000-0000
Re: CATERPILLAR
FINANCIAL ASSET TRUST
2007-A
Reference
No.
07DL29722
Ladies
and
Gentlemen:
The
purpose of this letter agreement is
to confirm the terms and conditions of the Swap Transaction entered into between
Xxxxxxx Xxxxx Capital Services, Inc. ("Party A") and Caterpillar Financial
Asset
Trust 2007-A ("Party B") on the Trade Date listed below (the
"Transaction"). This letter constitutes a "Confirmation" as referred
to in the Agreement specified below.
The
definitions and provisions contained
in (i) the 2000 ISDA
Definitions (as published by the International Swaps and Derivatives
Association, Inc.) (the "ISDA Definitions") and (ii) the sale and servicing
agreement, dated as of September 1, 2007 (the "SSA"), among Party B, Caterpillar
Financial Funding Corporation and Caterpillar Financial Services Corporation,
are incorporated into this Confirmation. For these purposes, all
references in the ISDA Definitions to a "Swap Transaction" will be deemed to
apply to the Transaction referred to herein. In the event of any
inconsistency between the ISDA Definitions and this Confirmation, this
Confirmation will govern. Other capitalized terms used herein and not otherwise
defined will have the meanings given them in the SSA. In the event of
any inconsistency between those terms and this Confirmation, this Confirmation
will govern.
1. This
Confirmation
supplements, forms part of, and is subject to, the ISDA Master Agreement, dated
as of September
27, 2007 between you and us
(as amended, supplemented or otherwise modified from time to time, the
"Agreement"). All provisions contained in the Agreement govern this Confirmation
except as expressly modified below.
2. The
terms of the
particular Transaction to which this Confirmation relates are as
follows:
|
Party
A:
|
Xxxxxxx
Xxxxx Capital Services,
Inc.
|
|
Party
B:
|
Caterpillar
Financial Asset Trust
2007-A
|
|
Transaction
Type:
|
Interest
Rate
Swap
|
|
Currency
for
Payment:
|
U.S.
Dollars
|
|
Trade
Date:
|
September
17,
2007
|
|
Effective
Date:
|
September
27,
2007
|
|
Notional
Amount:
|
For
the Initial Calculation
Period, the Notional
Amount of this
Transaction for purposes of calculating payments due by either
party on
the first Distribution Date
(as defined in the SSA) will be
USD $126,000,000. With
respect to any subsequent
Calculation Period,
the Notional Amount will be
the Outstanding
Principal Amount of
the Class A-2b Notes (after giving effect to
all amounts distributed
as of the
Distribution Date
that is the first day of such Calculation Period)
as stated on the Servicer's
Report relating to
such Distribution
Date (the "Actual
Balance"). With respect
to any
Distribution Date, Party B will determine the Notional Amount and
will
inform Party A of such determination by the related Determination
Date
using the aggregate Outstanding Principal Amount of the Class A-2b
Notes prior to giving effect to
any payments of principal of the Class A-2b
Notes on the following
Distribution Date, as shown in the Servicer's Report relating to
such
Distribution
Date.
|
|
Initial
Calculation
Period:
|
September
27, 2007 to but
excluding October 25,
2007.
|
|
Termination
Date:
|
The
earlier of April 26, 2010 and
the date the aggregate Outstanding Principal Amount of the Class
A-2b
Notes has been reduced to
zero.
|
Fixed
Amounts
|
Fixed
Rate
Payer:
|
Party
B.
|
|
Fixed
Rate Payer Payment
Date:
|
Each
Distribution Date commencing
with the Distribution Date occurring in October 2007 and ending on
the
Termination Date, inclusive.
|
|
Fixed
Rate Payer Calculation
Period:
|
In
the case of the initial Fixed
Rate Payer Payment Date, the period from, and including, September
27,
2007 to, but excluding, October 25, 2007, and for each Fixed Rate
Payer
Payment Date thereafter, the period from and including the 25th day
of the
calendar month preceding such Fixed Rate Payer Payment Date to, but
excluding, the 25th day of the month in which such Fixed Rate Payer
Payment Date occurs; No
Adjustment.
|
11
|
Fixed
Rate:
|
4.907%
|
|
Fixed
Rate Day Count
Fraction:
|
For
each Fixed Rate Payer
Calculation Period, 30/360
|
Floating
Amounts
|
Floating
Rate
Payer:
|
Party
A.
|
|
Floating
Rate Payer Payment
Dates:
|
The
Second Business Day prior to
each Distribution Date commencing with the Distribution Date occurring
in
October 2007 and ending on the Termination Date,
inclusive.
|
|
Floating
Rate Payer Calculation
Period:
|
In
the case of the initial
Floating Rate Payer Payment Date, the period from, and including,
September 27, 2007 to, but excluding, October 25, 2007, and for each
Floating Rate Payer Payment Date thereafter, the period from and
including
the Distribution Date in the calendar month preceding such Floating
Rate
Payer Payment Date to, but excluding, the Distribution Date in the
month
in which such Floating Rate Payer Payment Date
occurs.
|
|
Floating
Rate for Initial
Calculation Period:
|
5.11847%
|
|
Spread:
|
Inapplicable.
|
|
Floating
Rate
Option:
|
USD-LIBOR-BBA.
|
|
Designated
Maturity:
|
One
month.
|
12
|
Floating
Rate Day Count
Fraction:
|
For
each Floating Rate Payer
Calculation Period,
Actual/360.
|
|
Reset
Dates:
|
The
first day of each Floating
Rate Payer Calculation
Period.
|
|
Business
Days:
|
As
defined in the
SSA.
|
3. Account
Details
|
Payments
to Party
A:
|
Xxxxxxx Xxxxx Capital Services, Inc.
Deutsche Bank Trust Company Americas, New York
ABA: 000000000
FAO: Xxxxxxx Xxxxx Capital Services, Inc., New York
Account: 00-000-000
Ref: US Swap Account
|
|
Payments
to Party
B:
|
U.S.
Bank National
Association
ABA 000000000
Credit U.S. Bank Trust/Structured Finance
A/C 173103322058
REF: Caterpillar Financial Asset Trust
2007-A
#118220001
|
|
Party
A Operations
Contact::
|
Xxxxxxx
Xxxxx World
Headquarters
4 World Financial Center
New York, New York 10080
Attention: Xxxxx Xxxxx
Telephone:
000-000-0000
|
|
Party
B Operations
Contact:
|
The
Bank of New York
(Delaware)
000 Xxxxx Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Attention: Corporate Trust
Administration
|
|
With
a copy
to:
|
Caterpillar
Financial Services
Corporation
0000 Xxxx Xxx Xxxxxx
Xxxxxxxxx, XX 00000-000
Fax: 000-000-0000
Telephone: 000-000-0000
Re: Caterpillar Financial Asset Trust
2007-A
|
13
Limitation
of Liability of Owner Trustee. Notwithstanding anything contained in
this Confirmation to the
contrary, this instrument has been or will be signed on behalf of Party B by
The
Bank of New York (Delaware) not in its individual capacity but solely in its
capacity as Owner Trustee of Party B and in no event will The Bank of New York
(Delaware) in its individual capacity or any beneficial owner of Party B have
any liability for the representations, warranties, covenants, agreements or
other obligations of Party B hereunder, as to all of which recourse will be
had
solely to the assets of Party B. For all purposes of this Confirmation, in
the
performance of any duties or obligations of Party B under this Confirmation, the Owner Trustee
will be subject to, and entitled to the benefits of, the terms and provisions
of
the Trust Agreement; provided, however, that the foregoing will not relieve
the
Owner Trustee from any liability it might otherwise have under the Trust
Agreement as a result of its gross negligence or willful
misconduct.
[SIGNATURE
PAGE
FOLLOWS]
14
Please
confirm that the foregoing
correctly sets forth the terms of our agreement by executing this Confirmation
and returning it to us.
|
Best
Regards,
|
CATERPILLAR
FINANCIAL ASSET TRUST
2007-A,
By:
|
The
Bank of New
York (Delaware), not in
its individual capacity but solely as Owner
Trustee
|
By:/s/
Xxxxxxxx X.
Xxxxx
Name:
Xxxxxxxx X.
Xxxxx
Title:
Vice
President
XXXXXXX
XXXXX CAPITAL SERVICES,
INC.
|
By: /s/
Xxxx
Xxx
|
|
Name:
Xxxx
Xxx
|
|
Title:
|
[Signature
Page to Confirmation with Trust – Class A-2b Notes]
Date: September
27, 2007
To: CATERPILLAR
FINANCIAL ASSET TRUST
2007-A
Contact: The
Bank of New York (Delaware)
Fax.: 000-000-0000
Telephone: 000-000-0000
Attention: Corporate
Trust Administration
From: XXXXXXX
XXXXX CAPITAL SERVICES,
INC.
Contact: Marina
Lyutershteyn
Email: Xxxxxx_Xxxxxxxxxxxx@xx.xxx
Telephone: (000)
000-0000
Fax: (000)
000-0000
Re:
CATERPILLAR FINANCIAL
ASSET TRUST 2007-A
Reference
No.
07DL29721
Ladies
and
Gentlemen:
The
purpose of this letter agreement is
to confirm the terms and conditions of the Swap Transaction entered into between
Xxxxxxx Xxxxx Capital Services, Inc. ("Party A") and Caterpillar Financial
Asset
Trust 2007-A ("Party B") on the Trade Date listed below (the
"Transaction"). This letter constitutes a "Confirmation" as referred
to in the Agreement specified below.
The
definitions and provisions contained
in (i) the 2000 ISDA
Definitions (as published by the International Swaps and Derivatives
Association, Inc.) (the "ISDA Definitions") and (ii) the sale and servicing
agreement, dated as of September 1, 2007 (the "SSA"), among Party B, Caterpillar
Financial Funding Corporation and Caterpillar Financial Services Corporation,
are incorporated into this Confirmation. For these purposes, all
references in the ISDA Definitions to a "Swap Transaction" will be deemed to
apply to the Transaction referred to herein. In the event of any
inconsistency between the ISDA Definitions and this Confirmation, this
Confirmation will govern. Other capitalized terms used herein and not otherwise
defined will have the meanings given them in the SSA. In the event of
any inconsistency between those terms and this Confirmation, this Confirmation
will govern.
1. This
Confirmation
supplements, forms part of, and is subject to, the ISDA Master Agreement, dated
as of September 27, 2007 between you and us (as amended, supplemented or
otherwise modified from time to time, the "Agreement"). All provisions contained
in the Agreement govern this Confirmation except as expressly modified
below.
2. The
terms of the
particular Transaction to which this Confirmation relates are as
follows:
|
Party
A:
|
Xxxxxxx
Xxxxx Capital Services,
Inc.
|
|
Party
B:
|
Caterpillar
Financial Asset Trust
2007-A
|
|
Transaction
Type:
|
Interest
Rate
Swap
|
|
Currency
for
Payment:
|
U.S.
Dollars
|
|
Trade
Date:
|
September
17,
2007
|
|
Effective
Date:
|
September
27,
2007
|
|
Notional
Amount:
|
For
the Initial Calculation
Period, the Notional
Amount of this
Transaction for purposes of calculating payments due by either
party on
the first Distribution Date
(as defined in the SSA) will be
USD $155,000,000. With
respect to any subsequent
Calculation Period,
the Notional Amount will be
the Outstanding
Principal Amount of
the Class A-3b Notes (after giving effect to
all amounts distributed
as of the
Distribution Date
that is the first day of such Calculation Period)
as stated on the Servicer's
Report relating to
such Distribution
Date (the "Actual
Balance"). With respect
to any
Distribution Date, Party B will determine the Notional Amount and
will
inform Party A of such determination by the related Determination
Date
using the aggregate Outstanding Principal Amount of the Class A-3b
Notes prior to giving effect to
any payments of principal of the Class A-3b
Notes on the following
Distribution Date, as shown in the Servicer's Report relating to
such
Distribution
Date.
|
|
Initial
Calculation
Period:
|
September
27, 2007 to but
excluding October 25,
2007.
|
|
Termination Date:
|
The
earlier of June 25, 2012 and
the date the aggregae Outstanding Principal Amount of the Class A-3b
Notes
has been reduced to zero.
|
Fixed
Amounts
|
Fixed
Rate
Payer:
|
Party
B.
|
|
Fixed
Rate Payer Payment
Date:
|
Each
Distribution Date commencing
with the Distribution Date occurring in October 2007 and ending on
the
Termination Date, inclusive.
|
|
Fixed
Rate Payer Calculation
Period:
|
In
the case of the initial Fixed
Rate Payer Payment Date, the period from, and including, September
27,
2007 to, but excluding, October 25, 2007, and for each Fixed Rate
Payer
Payment Date thereafter, the period from and including the 25th day
of the
calendar month preceding such Fixed Rate Payer Payment Date to, but
excluding, the 25th day of the month in which such Fixed Rate Payer
Payment Date occurs; No
Adjustment.
|
17
|
Fixed
Rate:
|
4.735%
|
|
Fixed
Rate Day Count
Fraction:
|
For
each Fixed Rate Payer
Calculation Period, 30/360
|
Floating
Amounts
|
Floating
Rate
Payer:
|
Party
A.
|
|
Floating
Rate Payer Payment
Dates:
|
The
Second Business Day prior to
each Distribution Date commencing with the Distribution Date occurring
in
October 2007 and ending on the Termination Date,
inclusive.
|
|
Floating
Rate Payer Calculation
Period:
|
In
the case of the initial
Floating Rate Payer Payment Date, the period from, and including,
September 27, 2007 to, but excluding, October 25, 2007, and for each
Floating Rate Payer Payment Date thereafter, the period from and
including
the Distribution Date in the calendar month preceding such Floating
Rate
Payer Payment Date to, but excluding, the Distribution Date in the
month
in which such Floating Rate Payer Payment Date
occurs.
|
|
Floating
Rate for Initial
Calculation Period:
|
5.11847%
|
|
Spread:
|
Inapplicable.
|
|
Floating
Rate
Option:
|
USD-LIBOR-BBA.
|
|
Designated
Maturity:
|
One
month.
|
|
Floating
Rate Day Count
Fraction:
|
For
each Floating Rate Payer
Calculation Period,
Actual/360.
|
18
|
Reset
Dates:
|
The
first day of each Floating
Rate Payer Calculation
Period.
|
|
Business
Days:
|
As
defined in the
SSA.
|
|
3.
Account
Details:
|
|
|
Payments
to Party
A:
|
Xxxxxxx
Xxxxx Capital Services,
Inc.
Deutsche Bank Trust Company Americas, New York
ABA: 000000000
FAO: Xxxxxxx Xxxxx Capital Services, Inc., New
York
Account: 00-000-000
Ref: US Swap
Account
|
|
Payments
to Party
B:
|
U.S.
Bank National Association
ABA 000000000
Credit: U.S. Bank Trust/Structure Finance
A/C 173103322058
REF: Caterpillar Financial Asset Trust 2007-A
#118220001
|
|
Party
A Operations
Contact:
|
Xxxxxxx
Xxxxx World
Headquarters
4 World Financial Center
New York, New York 10080
Attention: Xxxxx Xxxxx
Telephone:
000-000-0000
|
|
Party
B Operations
Contact:
|
The
Bank of New York
(Delaware)
000 Xxxxx Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Attention: Corporate Trust
Administration
|
|
With
A copy
to:
|
Caterpillar
Financial Services
Corporation
0000 Xxxx Xxx Xxxxxx
Xxxxxxxxx, XX 00000-0000
Fax: 000-000-0000
Telephone: 000-000-0000
Re: Caterpillar Financial Asset Trust
2007-A
|
19
Limitation
of Liability of Owner Trustee. Notwithstanding anything contained in
this Confirmation to the
contrary, this instrument has been or will be signed on behalf of Party B by
The
Bank of New York (Delaware) not in its individual capacity but solely in its
capacity as Owner Trustee of Party B and in no event will The Bank of New York
(Delaware) in its individual capacity or any beneficial owner of Party B have
any liability for the representations, warranties, covenants, agreements or
other obligations of Party B hereunder, as to all of which recourse will be
had
solely to the assets of Party B. For all purposes of this Confirmation, in
the
performance of any duties or obligations of Party B under this Confirmation, the Owner Trustee
will be subject to, and entitled to the benefits of, the terms and provisions
of
the Trust Agreement; provided, however, that the foregoing will not relieve
the
Owner Trustee from any liability it might otherwise have under the Trust
Agreement as a result of its gross negligence or willful
misconduct.
[SIGNATURE
PAGE
FOLLOWS]
20
Please
confirm that the foregoing
correctly sets forth the
terms of our agreement by executing this Confirmation and returning it to
us.
|
Best
Regards,
|
CATERPILLAR
FINANCIAL ASSET TRUST
2007-A,
|
By:
The
Bank of New York
(Delaware), not in its individual capacity but solely as Owner
Trustee
|
By:/s/
Xxxxxxxx X.
Xxxxx
Name:
Xxxxxxxx X.
Xxxxx
Title:
Vice
President
XXXXXXX
XXXXX CAPITAL SERVICES,
INC.
|
By: /s/
Xxxx
Xxx
|
|
Name:
Xxxx
Xxx
|
|
Title:
|
[Signature
Page to Confirmation with Trust – Class A-3b Notes]