Exhibit 10.5
(Multicurrency--Cross Border) [LOGO]
ISDA(R)
International Swap Dealers Association, Inc.
MASTER AGREEMENT
dated as of __________ 1999
Westpac Banking Corporation Westpac Securities Administration Limited
(ARBN 007 457 141) (ACN 000 049 472) in its capacity as
------------------------------ and ---------------------------------------------
trustee of the Series 0000-0X XXX Xxxxx
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) 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.
(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 or 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 Identifiable 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.
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(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);
(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 judgement) 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 judgement 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)).
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(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, 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.
(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,
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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 part 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.
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
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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);
(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
judgement 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 judgement 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
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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;
(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.
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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.
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
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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 of 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.
(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.
(i) Events of Default. If the Early Termination Date results from an Event
of Default: --
(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
9
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.
(iii) 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").
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.
10
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.
(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.
11
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 messages 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 Transaction without 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. 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
12
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 an 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 an 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
13
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.
(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.
14
"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(e)(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
15
been required after that date. For this purpose, Unpaid Amounts in respect of
the Terminated Transaction or group or 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.
"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.
16
"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.
"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
17
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.
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.
Westpac Securities Administration
Limited
Westpac Banking Corporation (ACN 000 049 472) in its capacity as
ARBN 007 457 141 trustee of the Series 0000-0X XXX Xxxxx
----------------------------- -----------------------------------------
(Name of Party) (Name of Party)
By: By:
------------------------- -------------------------
Name: Name:
Title: Title:
Date: Date:
Westpac Securitisation Xxxxxx Guaranty Trust
Management Pty Limited Company of New York,
(ACN 000 000 000) London office
----------------------------- -----------------------------
(Name of Party) (Name of Party)
By: By:
------------------------- ------------------
Name: Name:
Title: Title:
Date: Date:
18
SCHEDULE
to the
Master Agreement
dated as of 13 May 1999
between WESTPAC BANKING CORPORATION (ARBN 007 457 141) ("PARTY A")
and WESTPAC SECURITIES ADMINISTRATION LIMITED (ACN 000 049 472) IN ITS CAPACITY
AS TRUSTEE OF THE SERIES 1999-1G WST TRUST ("PARTY B")
and WESTPAC SECURITISATION MANAGEMENT PTY LIMITED (ACN 000 000 000)
(the "TRUST MANAGER")
and XXXXXX GUARANTY TRUST COMPANY OF NEW YORK, LONDON OFFICE
(the "CREDIT SUPPORT PROVIDER")
PART 1: TERMINATION PROVISION
(a) "SPECIFIED ENTITY" in relation to:
(i) Party A, is not applicable; and
(ii) Party B, is not applicable.
(b) (i) The following provisions of Section 5 will not apply to
Party A:
Section 5(a)(ii) Section 5(a)(v) Section 5(b)(iv)
Section 5(a)(iii) Section 5(a)(vi)
Section 5(a)(iv) Section 5(b)(iii)
(ii) The following provisions of Section 5 will not apply to
Party B:
Section 5(a)(ii) Section 5(a)(v) Section 5(b)(iii)
Section 5(a)(iii) Section 5(a)(vi) Section 5(b)(iv)
Section 5(a)(iv) Section 5(a)(viii)
(iii) Replace Section 5(a)(i) and insert:
"(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 at or
before 10.00 am on the tenth Local Business Day after
notice of such failure is given to the party";
(iv) Section 5(b)(ii) will not apply to Party A as the Affected
Party (subject to Part 5(4)(ii) of this Schedule).
2
(v) The "BANKRUPTCY" provisions of Section 5(a)(vii) are replaced
by "An Insolvency Event (as defined in the Master Trust Deed)
has occurred in respect of the party. In relation to Party A,
the events described in the definition of Insolvency Event
shall apply to it as if Party A were a relevant corporation
referred to in that definition. The occurrence of an
Insolvency Event in respect of Party B in its personal
capacity will not constitute an Event of Default provided that
within thirty Business Days of that occurrence, Party B
procures the novation of this Agreement and all Transactions
to a third party in respect of which the Designated Rating
Agencies confirm that the novation will not cause a reduction
or withdrawal of the rating of the Notes and Party A agrees
that it will execute such a novation agreement in standard
ISDA form applicable in the A$ markets".
(vi) The application of Section 5(b)(i) will be restricted as set
out in Part 5(4) of this Schedule.
(c) The "AUTOMATIC EARLY TERMINATION" provisions in Section 6(a) will not
apply to Party A nor Party B.
(d) "PAYMENT ON EARLY TERMINATION". For the purposes of Section 6(e) of
this Agreement:
(i) Market Quotation will apply; and
(ii) the Second Method will apply.
(e) "TERMINATION CURRENCY" means US Dollars.
(f) "ADDITIONAL TERMINATION EVENT" means the occurrence of any of the
following:
(i) Party B is entitled to issue a notice to redeem all of the
Notes (in accordance with the Conditions of the Notes) for
reasons of taxation, in which case Party A shall be the
Affected Party for the purposes of Section 6(b)(iv) of this
Agreement and Party B shall be the Affected Party for the
purposes of Section 6(e)(ii)(1) of this Agreement; or
(ii) an Event of Default (as defined in the Security Trust Deed)
occurs and an Extraordinary Resolution of the Voting
Mortgagees (as defined in the Security Trust Deed) is passed
directing the Security Trustee to exercise rights under clause
8 of the Security Trust Deed, in which case Party B shall be
the Affected Party.
3
PART 2: TAX REPRESENTATIONS
(a) PAYER TAX REPRESENTATIONS. For the purpose of Section 3(e) of this
Agreement, Party A and Party B each make the following representation:
It is not required by any applicable law, as modified by the practice
of any relevant government 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) of this Agreement) 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) of this Agreement;
(ii) the satisfaction of the agreement contained in Section 4(a)(i)
or 4(a)(iii) of this Agreement and the accuracy and
effectiveness of any document provided by the other party
pursuant to Section 4(a)(i) or 4(a)(iii) of this Agreement;
and
(iii) the satisfaction of the agreement of the other party contained
in Section 4(d) of this Agreement,
provided that it shall not be a breach of this representation where
reliance is placed on clause (ii) 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) of this
Agreement:
Party A and Party B each make the following representation:
It is an Australian resident and does not derive the payments under
this Agreement in part or whole in carrying on business in a country
outside Australia at or through a permanent establishment of itself in
that country.
4
PART 3: DOCUMENTS TO BE DELIVERED
For the purpose of Section 4(a)(i) and (ii) of this Agreement, each party agrees
to deliver the following documents as applicable:
(a) Tax Forms, documents or certificates to be delivered are:
PARTY REQUIRED TO DELIVER FORM/DOCUMENT/ DATE BY WHICH DOCUMENT TO BE
DOCUMENT CERTIFICATE DELIVERED
Party A and Party B Any document or certificate reasonably As soon as reasonably practicable
required or reasonably requested by a following the earlier of (a) the
party in connection with its obligations relevant party learning that such
to make a payment under this Agreement document or certificate is
which would enable that party to make required and (b) a request by
the payment free from any deduction or other party.
withholding for or on account of Tax or
as would reduce the rate at which
deduction or withholding for or on
account of Tax is applied to that
payment.
(b) Other documents to be delivered are:
PARTY REQUIRED TO DELIVER FORM/DOCUMENT/ DATE BY WHICH DOCUMENT TO BE
DOCUMENT CERTIFICATE DELIVERED
Party A and Party B A legal opinion as to the validity and The date of this agreement.
enforceability of that party's
obligations under this Agreement in form
and substance reasonably acceptable to
the other party.
5
Party B A certified copy of the Security Trust The date of this Agreement.
Deed, Master Trust Deed, Series Notice
and Note Trust Deed (including Conditions
of Class A and Class B Notes).
For the purposes of this and the following
clause a copy of a document is taken to be
certified if a director or an Authorised
Signatory of Party B, or a person
authorised to execute this Agreement or a
Confirmation on behalf of Party B or a
solicitor acting for Party B has certified
it to be a true and complete copy of the
document of which it purports to be a copy.
Party B (Without limiting any obligation Party B Promptly after any such document
may have under the terms of the Security is entered into.
Trust Deed to notify Party A of amendments)
a certified copy of any document that
amends in any way the terms of the Security
Trust Deed
All documents delivered under this Part 3(b) are covered by Section 3(d)
representation.
6
PART 4: MISCELLANEOUS
(a) ADDRESSES FOR NOTICES. For the purpose of Section 12(a) of this
Agreement:
PARTY A:
Address: Westpac Banking Corporation
Xxxxx 0
000 Xxxxxxxxx Xxxxxx
Xxxxxx XXX 0000
Attention: Head of Derivatives Operations
Telex No: To be advised by Party A
Answerback: To be advised by Party A
Facsimile No: To be advised by Party A
PARTY B:
Address: Xxxxx 00, 000 Xxxx Xxxxxx, Xxxxxx
Attention: The Trustee Securitisation Manager
Facsimile No: 02 9220 5300
And a copy to the Trust Manager to the address provided to Party A.
(b) PROCESS AGENT. For the purpose of Section 13(c) of this Agreement:
Party A appoints as its Process Agent: Not applicable.
Party B appoints as its Process Agent: Not applicable.
The Credit Support Provider appoints as its Process Agent:
Assistant General Counsel
X.X. Xxxxxx Australia
Securities Limited
Xxxxx 00, 0 X'Xxxxxxx Xxxxxx
Xxxxxx XXX 0000
(c) OFFICES. The provisions of Section 10(a) will apply to Party A.
(d) MULTIBRANCH PARTY. For the purpose of Section 10(c) of this Agreement:
Party A is a Multibranch Party and will act through its Sydney Office
and its London Office. Party B is not a Multibranch Party.
(e) CALCULATION AGENT. The Calculation Agent is Party A (unless otherwise
specified in a Confirmation in relation to the relevant Transaction).
7
(f) CREDIT SUPPORT DOCUMENT. Details of any Credit Support Document:
(i) Party A: The 1994 ISDA Credit Support Annex attached to this
Agreement and the provisions of Section 20 of this Agreement.
(ii) Party B: The Security Trust Deed.
(g) CREDIT SUPPORT PROVIDER.
(i) In relation to Party A: Xxxxxx Guaranty Trust Company of New
York, London Office, unless:
(A) a Substitute Transaction becomes effective
in accordance with section 21 of the Other
Agreement, in which case, nil; or
(B) an Equivalent-Other Transaction becomes
effective in accordance with section 21 of
the Other Agreement, in which case the New
Currency Swap Provider shall be the new
"Credit Support Provider" in relation to
Party A.
(ii) In relation to Party B. Nil.
(h) GOVERNING LAW. This Agreement will be governed by and construed in
accordance with the laws of the State of New South Wales and section
13(b)(i) is replaced by "submits to the non-exclusive jurisdiction of
the courts of New South Wales and courts of Appeal from them".
(i) JURISDICTION. In the second line of section 13(b), the words ", the
Credit Support Provider and the Trust Manager" are inserted after the
words "each party".
(j) NETTING OF PAYMENTS. Subparagraph (ii) of Section 2(c) of this
Agreement will apply.
(k) "AFFILIATE" will have the meaning specified in Section 14 of this
Agreement. The words "or Affiliates" are deleted where they appear in
the first paragraph of Section 6(b)(ii).
8
PART 5: OTHER PROVISIONS
(1) PAYMENTS: In Section 2:
(i) In Section 2(a)(i) add the following sentence:
"Each payment will be by way of exchange for the
corresponding payment or payments payable by the
other party";
(ii) In Section 2(a)(ii) insert immediately after the words "freely
transferable funds" the following words:
", free of any set-off, counterclaim, deduction or
withholding (except as expressly provided in this
Agreement),"
(iii) Insert new paragraphs (iv) and (v) in Section 2(a) immediately
after Section 2(a)(iii) as follows:
"(iv) The condition precedent in Section 2(a)(iii)(1) does
not apply to a payment due to be made to a party
if it has satisfied all its payment and delivery
obligations under Section 2(a)(i) and has no
future payment or delivery obligations, whether
absolute or contingent under Section 2(a)(i).
(v) Where:
(1) payments are due pursuant to Section 2(a)(i)
by Party A to Party B (the "PARTY A PAYMENT")
and by Party B to Party A (the "PARTY B
PAYMENT") on the same day
then Party A's obligation to make the Party A payment
will be subject to the condition precedent (which
will be an "applicable condition precedent" for the
purpose of Section 2(a)(iii)(3)) that Party A first
receives either:
(2) the Party B payment; or
(3) confirmation from Party B's bank that it
holds irrevocable instructions to effect
payment of the Party B payment and that
funds are available to make that payment.";
(iv) add the following new sentence to Section 2(b):
"Party B may, for example, reasonably object if the change of
account would materially prejudice Noteholders including,
without limitation, any prejudice arising from any liability
to deduct or withhold any Tax as a result of such a change of
account."
(v) Delete the word "if" at the beginning of Section 2(d)(i)(4)
and insert the following words instead:
"if and only if X is Party A and";
9
(vi) In Section 2(d)(ii) insert the words "(if and only if Y is
Party A)" after the word "then" at the beginning of the last
paragraph.
(vii) add the following new Section 2(f):
(f) PAYMENT INSTRUCTIONS.
(i) Party B authorises and instructs Party A to make
payment of any amount due from Party A to Party B
hereunder by paying that amount direct to the
Principal Paying Agent to the account specified in
writing by the Principal Paying Agent to Party A and
to Party B. On payment of any such amount by Party A
to the Principal Paying Agent, Party A's obligation
shall be fully discharged in respect of that payment.
(ii) Party A authorises and instructs Party B to make
payment of any amount denominated in Australian
dollars due from Party B to Party A to the following
account in Sydney:
such account in Sydney as is specified by Party A
from time to time.
(2) ADDITIONAL REPRESENTATIONS: In Section 3 add the following immediately
after paragraph (f):
"(g) NON ASSIGNMENT. It has not assigned (whether absolutely, in
equity or otherwise) or declared any trust over (other than,
in respect of Party B, the trusts created under the Master
Trust Deed and the Series Notice) or given any charge over any
of its rights under this Agreement or any Transaction (except
in respect of Party B, for the security interest created under
the Security Trust Deed).
(h) CONTRACTING AS PRINCIPAL. Each existing Transaction has been
entered into by Party A as principal and not otherwise and
each existing Transaction has been entered into by Party B in
its capacity as trustee of the Trust and not otherwise."
(i) Absent a written agreement between the parties that expressly
imposes affirmative obligations to the contrary for that
Transaction:
(A) NON-RELIANCE. It is acting for its own account, and
it has made its own independent decisions to enter
into that Transaction and as to whether that
Transaction is appropriate or proper for it based
upon its own judgment and upon advice from the Trust
Manager and such advisors as it has deemed necessary.
It is not relying on any communication (written or
oral) of the other party as investment advice or as a
recommendation to enter into that Transaction; it
being understood that information and explanations
related to the terms and conditions of a Transaction
shall not be considered investment advice or a
recommendation to enter into that Transaction. It has
not received from the other party any assurance or
guarantee as to the expected results of that
Transaction;
(B) EVALUATION AND UNDERSTANDING. It is capable of
evaluating and understanding (on its own behalf or
through independent professional advice including the
Trust Manager), and understands and accepts the
10
terms, conditions and risks of that Transaction. It
is also capable of assuming, and assumes, the
financial and other risks of that Transaction;
(C) STATUS OF PARTIES. The other party is not acting as a
fiduciary or an advisor for it in respect of that
Transaction;
(j) Party B represents and warrants on a continuing basis:
(A) TRUST VALIDLY CREATED. The Trust has been validly
created and is in existence at the date of this
Agreement.
(B) SOLE TRUSTEE. It has been validly appointed as
trustee of the Trust and is presently the sole
trustee of the Trust.
(C) NO PROCEEDINGS TO REMOVE. No notice has been given to
it and to its knowledge no resolution has been
passed, and no direction or notice has been given,
removing it as trustee of the Trust.
(D) POWER. It has power to enter into this Agreement and
the Credit Support Document in its capacity as
trustee of the Trust.
(E) GOOD TITLE. It is the owner in equity of the assets
of the Trust and has power to mortgage or charge them
in the manner provided in the Credit Support
Document, and, subject only to the Credit Support
Document and any Security Interest permitted under
the Credit Support Document, those assets are free of
all other Security Interests.
(3) ADDITIONAL COVENANT: In Section 4 add a new paragraph as follows:
"(f) CONTRACTING AS PRINCIPAL. Party A will enter into all
Transactions as principal and not otherwise and Party B will
enter into all Transactions in its capacity as trustee of the
Trust and not otherwise".
(4) AMENDMENT TO SECTION 6. In section 6 make the following amendments:
(i) Section 6(a) is amended by deleting the words "all outstanding
Transactions" where they appear and inserting instead the
words "THE RELEVANT SWAP TRANSACTION".
(ii) Add a new section 6(aa):
"(aa) RESTRICTED TERMINATION RIGHTS.
(i) TERMINATION BY PARTY B: Party B must not designate an
Early Termination Date without the prior written
consent of the Note Trustee.
(ii) CONSULTATION REGARDING TIMING: Each Party may only
designate an Early Termination Date following prior
consultation with the other Party as to the timing of
the Early Termination Date. Subject to its duties
under the Master Trust Deed and the Series Notice,
Party B may exercise any rights in its capacity as
holder of the Purchased Receivables only on the
instructions of the Note Trustee and only after
consultation between Party
11
A and Note Trustee. Party B may only designate an
Early Termination Date at the direction of the
Trust Manager.
(iii) PARTY A'S LIMITED RIGHTS IN RELATION TO TAX EVENT:
Notwithstanding Part 1(b)(iv) of this Schedule, Party
A may designate an Early Termination Date if it is an
Affected Party following a Tax Event but only if the
Note Trustee is satisfied that the Noteholders and
Couponholders will be paid in full all principal and
interest outstanding on the Notes.
(iv) ILLEGALITY: The parties agree that imposition by any
Agency of an Australian jurisdiction of any exchange
controls, restrictions or prohibitions will not
constitute an Illegality for the purposes of Section
5(b)(i) and Party A will not be entitled to designate
an Early Termination Date, and in those
circumstances, payment by Party B in accordance with
section 2(f) will continue to be proper performance
of its payment obligation and Party A's obligations
will be unaffected, to the extent of Party B's
payments under section 2(f).
(v) TRANSFER WHERE PARTY B DOES NOT GROSS-UP: If any
payment by Party B to Party A under this Agreement
is, or is likely to be, made subject to any deduction
or withholding on account of Tax, Party B will
endeavour to procure the substitution as principal
obligor under this Agreement in respect of each
Affected Transaction of a Party B incorporated in
another jurisdiction approved by Party A and the Note
Trustee and in respect of which the Designated Rating
Agencies confirm that the substitution will not cause
a reduction or withdrawal of the rating of the Notes.
(iii) In section 6(b)(ii), add the words "so long as the transfer in
respect of that Transaction would not lead to a rating
downgrade of any rated debt of Party B that is secured under
the Security Trust Deed" after the words "ceases to exist" at
the end of the first paragraph.
(iv) In section 6(e), delete the 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." at
the end of the first paragraph.
(5) In section 9, add the following new paragraphs:
"(h) FURTHER ASSURANCES. Each party shall, upon request by the
other party (the "REQUESTING PARTY") at the expense of the
requesting party, perform all such acts and execute all such
agreements, assurances and other documents and instruments as
the requesting party reasonably requires and which are within
the powers of that party to assure and confirm the rights and
powers afforded, created or intended to be afforded or
created, under or in relation to this Agreement and each
Transaction or other dealing which occurs under or is
contemplated by it.
(i) RECORDED CONVERSATION. Each party:
(A) consents to the recording of the telephone
conversations of trading and marketing personnel of
that party and its Affiliates in connection with this
Agreement or any potential Transaction; and
12
(B) agrees to obtain any necessary consent of, and give
notice of such recording to, such personnel of it and
its Affiliates.
(j) ISDA DEFINITIONS: This Agreement, each Confirmation and each
Transaction are subject to the 1991 ISDA Definitions (as
supplemented by the 1998 Supplement to the 1991 ISDA
Definitions (each as published by the International Swap and
Derivatives Association, Inc.) (the "ISDA DEFINITIONS"), and
will be governed in all respects by any provisions set forth
in the ISDA Definitions, without regard to any amendments to
the ISDA Definitions made after the date of this Agreement.
The ISDA Definitions are incorporated by reference in, and
shall be deemed to be part of, this Agreement and each
Confirmation.
(k) INCONSISTENCY: In the event of any inconsistency between any
two or more of the following documents, they shall take
precedence over each other in the following descending order:
(i) any Confirmation;
(ii) the Schedule to the Master Agreement and "Paragraph
13 - Elections and Variables" to the ISDA Credit
Support Annex (as applicable);
(iii) the ISDA Definitions;
(iv) the printed form of ISDA Master Agreement and ISDA
Credit Support Annex (as applicable)."
(6) FACSIMILE TRANSMISSIONS: Replace Section 12(a)(iii) with:
"(iii) if sent by facsimile, on production of a transmission report
by the machine from which the facsimile was sent which
indicates that the facsimile was sent in its entirety to the
facsimile number of the recipient notified for the purpose of
this Section unless the recipient notifies the sender within
24 hours of the facsimile being sent that the facsimile was
not received in its entirety in legible form;"
(7) DEFINITIONS: In section 14:
(i) add a new paragraph:
"Unless otherwise defined in this Agreement, terms defined in
the Security Trust Deed (either expressly or by incorporation
by reference) have the same meaning where used in this
Agreement."
(ii) Insert the following definitions in its appropriate
alphabetical places in Section 14:
"'RELEVANT SWAP TRANSACTION' means, in relation to Class A
Notes, each Transaction which is a Currency Swap for Class A
Notes only, and in relation to Class B Notes, each Transaction
which is a Currency Swap for Class B Notes only."
"'SECURITY TRUST DEED' means the Series 0000-0X XXX Xxxxx
Security Trust Deed dated on or about the date of this
Agreement between Party B as chargor, Perpetual Trustee
Company Limited as security trustee, the Trust Manager and
Citibank, N.A., London Office as note trustee."
13
(iii) SWAP TRANSACTION. Any reference to a:
(a) "SWAP TRANSACTION" in the 1991 ISDA Definitions is
deemed to be a reference to a "Transaction" for the
purpose of interpreting this Agreement or any
Confirmation; and
(b) "TRANSACTION" in this Agreement or any Confirmation
is deemed to be a reference to a "Swap Transaction"
for the purpose of interpreting the 1991 ISDA
Definitions.
(iv) In the definition of "Market Quotation", on line 1 on page 16
of this Agreement, replace the words "been required after that
date." with:
"been required after that date and, in respect of each
Terminated Transaction which is a Relevant Swap Transaction,
on the basis that the Housing Loan Principal as defined in
Series Notice referred to in the Terminated Transaction will
thereafter have an amortisation schedule based on a constant
prepayment rate per annum ("CPR") equal to:
(a) [XX.X]%, if the Replacement Transaction is calculated
within one year of the Effective Date of the
Terminated Transaction; or
(b) if the Replacement Transaction is calculated later
than one year after the Effective Date of the
Terminated Transaction, the arithmetic mean of the
following:
(I) the four CPRs most recently published prior
to the relevant quotation on Bloomberg
monitor service in respect of the Class of
Notes applicable to the Terminated
Transaction (based on data provided to
Bloomberg by the Trust Manager);
(II) the forecast CPR provided to the party
making the determination (or its agent) by
Party A for the remaining life of the Class
of Notes applicable to the Terminated
Transaction;
(III) the forecast CPR provided to the party
making the determination (or its agent) by
the Credit Support Provider for the
remaining life of the Class of Notes
applicable to the Terminated Transaction;
(IV) the forecast CPR provided to the party
making the determination (or its agent) by
the Trust Manager for the remaining life of
the Class of Notes applicable to the
Terminated Transaction,
without regard to the CPRs having the highest and
lowest values (unless fewer than three CPRs are
provided under subparagraphs (II), (III) and (IV)
collectively, in which case all CPRs will be taken
into account in the calculation of the arithmetic
mean). For this purpose, if more than one CPR has the
same highest value or lowest value, then one of such
CPRs shall be disregarded.
14
(8) OTHER PROVISIONS, INCLUDING CREDIT SUPPORT:
Insert the following Sections 15, 16, 17, 18, 19, 20 and 21 after
Section 14:
"15. SEGREGATION:
The liability of Party B under this Agreement is several and
is separate in respect of each Relevant Swap Transaction. The
failure of Party B to perform its obligations in respect of
any Relevant Swap Transaction shall not release Party B from
its obligations under this Agreement or under any other
Relevant Swap Transaction in respect of any other Notes issued
by Party B. Nothing in this Agreement affects the respective
priority rankings of claims against the Mortgaged Property of
Party B under the Security Trust Deed. Without limiting the
generality of the foregoing, the provisions of this Agreement
shall have effect separately and severally in respect of each
Relevant Swap Transaction and shall be enforceable by or
against Party B as though a separate agreement applied between
Party A and Party B for each Relevant Swap Transaction, so
that (among other things):
(i) this Agreement together with each Confirmation
relating to a Relevant Swap Transaction will form a
single separate agreement between Party A and Party B
and references to the respective obligations
(including references to payment obligations
generally and in the context of provisions for the
netting of payments and the calculation of amounts
due on early termination) of Party A and Party B
shall be construed accordingly as a several reference
to each mutual set of obligations arising under each
such separate agreement between Party A and Party B;
(ii) representations made and agreements entered into by
the parties under this Agreement are made and entered
separately and severally by Party B in respect of
each Relevant Swap Transaction and may be enforced by
Party B against Party A separately and severally in
respect of each Relevant Swap Transaction;
(iii) rights of termination, and obligations and
entitlements consequent upon termination, only accrue
to Party A against Party B separately and severally
in respect of each Relevant Swap Transaction, and
only accrue to Party B against Party A separately and
severally in respect of each Relevant Swap
Transaction; and
(iv) the occurrence of an Event of Default or Termination
Event in respect of a Relevant Swap Transaction does
not in itself constitute an Event of Default or
Termination Event in respect of any other Relevant
Swap Transaction."
16. RECOURSE
Party B enters into this Agreement in its capacity as Trustee
of the Trust, and Clause 3.3(b) of the Series Notice applies
to this Agreement as if set out in full. Clause 16 of the
Security Trust Deed shall apply to govern Party A's priority
to moneys received from the sale of Assets or other
enforcement of the Charge under the Security Trust Deed.
15
This Section 16:
(i) applies even though any other provision of this
Agreement is not made subject to it; and
(ii) overrides any other provision of this Agreement which
is inconsistent with it.
17. THE TRUST MANAGER
Party A acknowledges that the Trust Manager will, at the
request of Party B, perform the day to day management of the
Trust on the terms and conditions of the Master Trust Deed and
Series Notice. Unless expressly advised to the contrary in
writing by Party B from time to time, any rights or
obligations of Party B under this Agreement may be exercised
or satisfied (as the case may be) by the Trust Manager on
behalf of Party B and Party A is not obliged to enquire as to
the authority of the Trust Manager to take such action on
behalf of Party B. Except where the context otherwise
requires, references in this Agreement to a "party" to this
Agreement are to Party A or Party B.
18. TRUST DEED
The parties acknowledge and agree that, for the purposes of
the Master Trust Deed and the Trust Documents, this Agreement
is a "Hedge Agreement" and Party A is a "Swap Provider" and
"Support Facility Provider".
19. REPLACEMENT CURRENCY SWAP
(a) If this Agreement is terminated, Party B may, at the
direction of the Trust Manager, enter into one or
more currency swaps which replace the Transactions
under this Agreement (collectively a "Replacement
Currency Swap") but only on the condition that the
Settlement Amount payable (if any) by Party B to
Party A upon termination of this Agreement will be
paid in full when due in accordance with the Series
Notice and this Agreement.
(b) If the condition in section 19(a) is satisfied, Party
B may enter into the Replacement Currency Swap and if
it does so it must direct the Replacement Currency
Swap provider to pay any upfront premium to enter
into the Replacement Currency Swap due to Party B
directly to Party A in satisfaction of and to the
extent of Party B's obligation to pay the Settlement
Amount to Party A as referred to in section 19(a),
and to the extent that such premium is not greater
than or equal to the Settlement Amount, the balance
may be satisfied by Party B as a Trust Expense (as
defined in the Series Notice).
(c) The obligations of Party B (and the rights of Party
A) under this section 19 constitute separate and
independent obligations of Party B (and rights of
Party A) and shall survive the termination of this
Agreement.
(d) If a Settlement Amount is payable by Party A to Party
B upon termination of this Agreement, Party B may
direct Party A to pay all or part of that amount (but
not any greater amount) to the extent required to the
Replacement Currency Swap provider in satisfaction of
and to the extent
16
of Party B's obligation to pay any
upfront premium to the Replacement Currency Swap
provider to enter into the Replacement Currency Swap.
20. CREDIT SUPPORT
(a) In consideration of Party B entering into an
agreement on the same material terms as this
Agreement with the Credit Support Provider (the
"Other Agreement") and Transactions under the Other
Agreement on the same material economic terms as
Transactions under this Agreement, the Credit Support
Provider hereby unconditionally guarantees to Party B
the payment by Party A of moneys which are payable by
Party A under a Relevant Swap Transaction (on terms
set out in this Agreement and in the Confirmation for
that Relevant Swap Transaction) (the "Payable
Moneys") to Party B in the event that Party A
defaults in the payment of those Payable Moneys.
(b) If Party B has not been, or Party A reasonably
expects that Party B is not going to be, paid all or
any part of the presently payable Payable Moneys by
Party A, then Party A or Party B may by notice to the
Credit Support Provider demand payment of the Payable
Moneys in respect of which demand is being made. The
Credit Support Provider's obligations to pay, within
the applicable grace period, the presently payable
Payable Moneys which have not been paid by Party A
shall not, however, be conditional upon the Credit
Support Provider receiving such notice of demand.
(c) The Credit Support Provider agrees that it will not,
unless and until all the present and prospective
Payable Moneys have been paid, exercise any rights of
subrogation which it may acquire due to its payment
of Payable Moneys under section 20(a).
(d) All payments by the Credit Support Provider shall be
made in the currency in which the Payable Moneys are
denominated.
(e) Party B agrees that, without affecting its rights
under clause 21, to the extent that the Credit
Support Provider pays the Payable Moneys and thereby
avoids or remedies a default by Party A, Party B
shall not be entitled to designate an Early
Termination Date in respect of that default by Party
A, and such a payment by the Credit Support Provider
shall be deemed to be an "actual payment" as referred
to in line 6 of section 2(e) of this Agreement.
(f) The provisions of this section 20 shall constitute
irrevocable obligations of the Credit Support
Provider until a notice of revocation is served by
the Credit Support Provider on Party B, but such a
notice cannot and shall not be served without the
prior written consent of Party A, the Note Trustee
and the Trust Manager in consultation with the
Designated Rating Agencies.
21. CREDIT SUPPORT PROVIDER TRANSACTIONS
(a) The Credit Support Provider may give a Substitution
Notice to Party B specifying a Transaction which
shall be substituted under this Section 21
17
(a "Replaced Transaction"), but only on the condition
that a Credit Event has occurred in respect of Party
A.
(b) If the Credit Support Provider gives a Substitution
Notice under paragraph 21(a), then either:
(i) a Substitute Transaction shall become
effective and the Effective Date shall be
the date specified in the Substitution
Notice; or
(ii) both:
(A) Party B, the Credit Support Provider
and the Trust Manager must enter
into an Equivalent Transaction with
a suitably rated counterparty
procured by the Credit Support
Provider and accepted by Party B,
the Trust Manager and the Note
Trustee (the "New Currency Swap
Provider") and the Effective Date
shall be the date specified in the
Substitution Notice as the Effective
Date for the Equivalent-Other
Transaction; and
(B) an Equivalent-Other Transaction
shall become effective and the
Effective Date shall be the date
specified in the Substitution
Notice. The New Currency Swap
Provider must sign, and Party B, the
Credit Support Provider and the
Trust Manager must countersign, an
accession as provided for in the
Confirmation for the
Equivalent-Other Transaction.
For the avoidance of doubt, if the Substitution
Notice specifies that either the Transaction under
paragraph (b)(i) or the Transactions under paragraphs
(b)(ii)(A) and (B) shall become effective as
alternatives, and if a suitably rated counterparty is
not procured by the Credit Support Provider under
paragraph (b)(ii)(A), the Substitute Transaction must
become effective in accordance with paragraph (b)(i).
(c) On the date on which the Transactions become
effective in accordance with a Substitution Notice
under either paragraph (b)(i) or (b)(ii):
(i) the Replaced Transaction shall terminate;
and
(ii) the Other Transaction shall terminate.
(d) No Settlement Amount or other amount under section 6
or section 11 shall be payable by, or to, Party B (as
the case may be) upon the termination of the
Transactions under paragraphs (c)(i) and (ii),
because the Transactions specified in paragraphs
(b)(i), or (b)(ii)(A) and (B), as the case may be,
shall have the effect of preserving for Party B the
economic equivalent of the payments under the
Transactions which are being terminated.
(e) Definitions. For the purposes of this Section 21:
18
"Credit Event" means, in relation to Party A, the
occurrence at any time of any of the following events
with respect to Party A:
(i)(A) failure by Party A to make, when due, any
payment under the Replaced Transaction
required to be made by it if such failure is
not remedied on or before the tenth local
Business Day after notice of such failure is
given to Party A; and
(B) On any day on which a failure by Party A
under paragraph (e)(i)(A) is subsisting:
(I) the Market Value of a floating rate
Reference Obligation is below the
Initial Price of such by more than the
Price Decline Requirement;
(II) the sum of the Market Value of a fixed
rate Reference Obligation and the
Interest Rate Adjustment Amount of
such is below the Initial Price of
such by more than the Price Decline
Requirement; or
(III) the occurrence with respect to Party A
of an event specified in paragraph
7(i) of the Credit Support Annex
attached to this Agreement.
For the purposes of this paragraph
(e)(i)(B), "Market Value", "Reference
Obligation", "Initial Price", "Price
Decline Requirement" and "Interest
Rate Adjustment Amount" shall have the
meanings given in the Confirmation for
the Replaced Transaction; or
(ii) the occurrence of (A) a default, event of
default or other similar condition or event
(however described) in respect of Party A
under one or more agreements or instruments
relating to Specified Indebtedness of Party
A in an aggregate amount of not less than
the applicable Threshold Amount which has
resulted in the Specified Indebtedness
becoming due and payable under such
agreements or instruments before it would
otherwise have been due and payable, or (B)
a default by Party A 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).
For the purposes of this paragraph (e)(ii),
"Specified Indebtedness" and "Threshold
Amount" shall have the meanings given in the
Confirmation for the Replaced Transaction;
or
(iii) the occurrence with respect to Party A of an
event specified in Section 5(a)(vii)(1) to
(9) inclusive; or
(iv) the occurrence with respect to Party A of an
event specified in Section 5(b)(i)(1); or
19
(v) the occurrence with respect to Party A (and
not the Credit Support Provider) of an event
specified in Section 5(a)(viii);
"Equivalent Transaction" means a Transaction governed
by a new agreement on the same material terms as this
Agreement and on the same material economic terms as
the Replaced Transaction, and with the same Trade
Date as the Replaced Transaction, except that:
(i) the New Currency Swap Provider is designated
as "Party A";
(ii) the Credit Support Provider is designated as
the new "Credit Support Provider" in
relation to Party A;
(iii) the "Effective Date" is as specified in the
relevant Confirmation for that Transaction,
being the same date as that specified in the
Substitution Notice as the Effective Date
for the Equivalent-Other Transaction; and
(iv) no Initial Exchanges are payable under the
Transaction.
"Equivalent-Other Transaction" means a Transaction
governed by the Other Agreement and on the same
material economic terms as the Other Transaction and
with the same Trade Date as the Replaced Transaction,
except that:
(i) the Credit Support Provider is designated as
the new Party A;
(ii) the New Currency Swap Provider is designated
as the new "Credit Support Provider" in
relation to Party A;
(iii) the "Effective Date" is as specified in the
relevant Substitution Notice; and
(iv) no Initial Exchanges are payable under the
Transaction.
"New Currency Swap Provider" has the meaning given
in paragraph (b)(ii)(A);
"Other Agreement" has the meaning given in
section 20;
"Other Transaction" means the Transaction governed by
the Other Agreement and on the same economic terms as
the Replaced Transaction, with the same Trade Date as
the Replaced Transaction, and as specified as such in
the relevant Substitution Notice;
"Replaced Transaction" means the Transaction governed
by this Agreement, and specified as such in the
relevant Substitution Notice, as referred to in
section 21(a);
"Substitute Transaction" means a Transaction governed
by the Other Agreement, and on the same economic
terms as the Other Transaction and with the same
Trade Date as the Replaced Transaction, except that:
20
(i) no party is designated as a "Credit Support
Provider";
(ii) the Effective Date is as specified in the
relevant Substitution Notice;
(iii) the Notional Amounts applicable to the
Floating Amounts payable by the respective
parties under the Transaction are the same
as the Notional Amounts applicable to the
Floating Amounts payable by the respective
parties under the Replaced Transaction
except that the references to "fifty (50)
percent" are substituted by references to
"one hundred (100) percent";
(iv) no Initial Exchanges are payable; and
(v) no "Credit Support Provider Provisions"
apply.
"Substitution Notice" means an irrevocable notice in
writing from the Credit Support Provider to Party B
and the Trust Manager, which may be delivered between
9.00 am and 4.00 pm in Sydney on a Business Day in
accordance with section 12, and which:
(i) describes the occurrence of a Credit Event;
(ii) specifies the Effective Date for an
Equivalent-Other Transaction or for a
Substitute Transaction (or for either
Transactions under Section 21(b)(i) or
21(b)(ii), as alternatives) and specifies
the proposed New Currency Swap Provider and,
if an Equivalent-Other Transaction is
specified, the terms of the Equivalent
Transaction (by attaching a proposed
Confirmation for the Equivalent
Transaction); and
(iii) confirms that the Termination Date for the
Replaced Transaction and the Other
Transaction shall be the Effective Date for
the Transactions in either paragraphs
(b)(i), or (b)(ii)(A) and (B), as the case
may be.
(f) Section 21 and any related provision in a
Confirmation (the "Substitution Provisions") shall
not amend, or affect the operation of, any other
provision in this Agreement, except to the extent, if
any, expressly provided by the Substitution
Provisions. For the avoidance of doubt and without
limitation, the Substitution Provisions shall not
amend, or affect the operation of, the provisions of
the Credit Support Annex, sections 15 to 20
inclusive, and provisions in this Agreement which
specify certain events as Events of Default or
Termination Events.
(Bilateral Form) (ISDA Agreements Subject to New York Law Only)
ISDA-Registered Trademark-
International Swaps and Derivatives Association, Inc.
CREDIT SUPPORT ANNEX
to the Schedule to the
ISDA MASTER AGREEMENT
---------------------
dated as of
---------------------------
WESTPAC SECURITIES
WESTPAC between ADMINISTRATION LIMITED
BANKING AS TRUSTEE OF THE
CORPORATION and SERIES 0000-0X XXX TRUST
------------------------------ ----------------------------------
("Party A") ("Party B")
This Annex supplements, forms part of, and is subject to, the
above-referenced 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--
PARAGRAPH 1. INTERPRETATION
(a) DEFINITIONS AND INCONSISTENCY. Capitalized terms not otherwise defined
herein or elsewhere in this Agreement have the meanings specified pursuant to
Paragraph 12, and all references in this Annex to Paragraphs are to
Paragraphs of this Annex. In the event of any inconsistency between this
Annex and the other provisions of this Schedule, this Annex will prevail, and
in the event of any inconsistency between Paragraph 13 and the other
provisions of this Annex. Paragraph 13 will prevail.
(b) SECURED PARTY AND PLEDGOR. All references in this Annex to the "Secured
Party" will be to either party when acting in that capacity and all
corresponding references to the "Pledgor" will be to the other party when
acting in that capacity; PROVIDED, HOWEVER, that if Other Posted Support is
held by a party to this Annex, all references herein to that party as the
Secured Party with respect to that Other Posted Support will be to that party
as the beneficiary thereof and will not subject that support of that party as
the beneficiary thereof to provisions of law generally relating to security
interests and secured parties.
PARAGRAPH 2. SECURITY INTEREST
Each party, as the Pledgor, hereby pledges to the other party, as the Secured
Party, as security for its Obligations, and grants to the Secured Party a
first priority continuing security interest in, lien on and right of Set-off
against all Posted Collateral Transferred to or received by the Secured Party
hereunder. Upon the Transfer by the Secured Party to the Pledgor of Posted
Collateral, the security interest and lien granted hereunder on that Posted
Collateral will be released immediately and, to the extent possible, without
any further action by either party.
Copyright-C- 1994 by International Swaps and Derivatives Association, Inc.
PARAGRAPH 3. CREDIT SUPPORT OBLIGATIONS
(a) DELIVERY AMOUNT. Subject to Paragraphs 4 and 5, upon a demand made by
the Secured Party on or promptly following a Valuation Date, if the Delivery
Amount for that Valuation Date equals or exceeds the Pledgor's Minimum
Transfer Amount, then the Pledgor will Transfer to the Secured Party Eligible
Credit Support having a Value as of the date of Transfer at least equal to
the applicable Delivery Amount (rounded pursuant to Paragraph 13). Unless
otherwise specified in Paragraph 13, the "DELIVERY AMOUNT" applicable to the
Pledgor for any Valuation Date will equal the amount by which:
(i) the Credit Support Amount
exceeds
(ii) the Value as of that Valuation Date of all Posted Credit Support held
by the Secured Party.
(b) RETURN AMOUNT. Subject to Paragraphs 4 and 5, upon a demand made by the
Pledgor on or promptly following a Valuation Date, if the Return Amount for
that Valuation Date equals or exceeds the Secured Party's Minimum Transfer
Amount, then the Secured Party will Transfer to the Pledgor Posted Credit
Support specified by the Pledgor in that demand having a Value as of the date
of Transfer as close as practicable to the applicable Return Amount (rounded
pursuant to Paragraph 13). Unless otherwise specified in Paragraph 13, the
"RETURN AMOUNT" applicable to the Secured Party for any Valuation Date will
equal the amount by which:
(i) the Value as of that Valuation Date of all Posted Credit Support held
by the Secured Party
exceeds
(ii) the Credit Support Amount.
"CREDIT SUPPORT AMOUNT" means, unless otherwise specified in Paragraph 13,
for any Valuation Date (i) the Secured Party's Exposure for that Valuation
Date plus (ii) the aggregate of all Independent Amounts applicable to the
Pledgor, if any, minus (iii) all Independent Amounts applicable to the
Secured Party, if any, minus (iv) the Pledgor's Threshold; PROVIDED, HOWEVER,
that the Credit Support Amount will be deemed to be zero whenever the
calculation of Credit Support Amount yields a number less than zero.
PARAGRAPH 4. CONDITIONS PRECEDENT, TRANSFER TIMING, CALCULATIONS AND
SUBSTITUTIONS
(a) CONDITIONS PRECEDENT. Each Transfer obligation of the Pledgor under
Paragraphs 3 and 5 and of the Secured Party under Paragraphs 3.4(d)(ii), 5
and 6(d) is subject to the conditions precedent that:
(i) no Event of Default, Potential Event of Default or Specified Condition
has occurred and is continuing with respect to the other party; and
(ii) no Early Termination Date for which any unsatisfied payment
obligations exist has occurred or been designated as the result of an
Event of Default or Specified Condition with respect to the other party.
(b) TRANSFER TIMING. Subject to Paragraphs 4(a) and 5 and unless otherwise
specified, if a demand for the Transfer of Eligible Credit Support or Posted
Credit Support is made by the Notification Time, then the relevant Transfer
will be made not later than the close of business on the next Local Business
Day; if a demand is made after the Notification Time, then the relevant
Transfer will be made not later than the close of business on the second
Local Business Day thereafter.
(c) CALCULATIONS. All calculations of Value and Exposure for purposes of
Paragraphs 3 and 6(d) will be made by the Valuation Agent as of the Valuation
Time. The Valuation Agent will notify each party (or the other party, if the
Valuation Agent is a party of its calculations not later than the
Notification Time on the Local Business Day following the applicable
Valuation Date (or in the case of Paragraph 6(d), following the date of
calculation).
2
(d) SUBSTITUTIONS.
(i) Unless otherwise specified in Paragraph 13, upon notice to the
Secured Party specifying the items of Posted Credit Support to be
exchanged, the Pledgor may, on any Local Business Day, Transfer to the
Secured Party substitute Eligible Credit Support (the "Substitute
Credit Support"); and
(ii) subject to Paragraph 4(a), the Secured Party will Transfer to the
Pledgor the items of Posted Credit Support specified by the Pledgor in its
notice not later than the Local Business Day following the date on which
the Secured Party receives the Substitute Credit Support, unless otherwise
specified in Paragraph 13 (the "Substitution Date"); PROVIDED that the
Secured Party will only be obligated to Transfer Posted Credit Support
with a Value as of the date of Transfer of that Posted Credit Support equal
to the Value as of that date of the Substitute Credit Support.
PARAGRAPH 5. DISPUTE RESOLUTION
If a party (a "Disputing Party") disputes (1) the Valuation Agent's
calculation of a Delivery Amount or a Return Amount or (II) the Value of any
Transfer of Eligible Credit Support or Posted Credit Support, then (1) the
Disputing Party will notify the other party and the Valuation Agent (if the
Valuation Agent is not the other party) not later than the close of business
on the Local Business Day following (X) the date that the demand is made
under Paragraph 3 in the case of (I) above or (Y) the date of Transfer in the
case of (II) above, (2) subject to Paragraph 4(a), the appropriate party will
Transfer the undisputed amount to the other party not later than the close of
business on the Local Business Day following (X) the date that the demand is
made under Paragraph 3 in the case of (I) above or (Y) the date of Transfer
in the case of (II) above, (3) the parties will consult with each other in
an attempt to resolve the dispute and (4) if they fail to resolve the dispute
by the Resolution Time, then:
(i) In the case of a dispute involving a Delivery Amount or Return
Amount, unless otherwise specified in Paragraph 13, the Valuation Agent
will recalculate the Exposure and the Value as of the Recalculation Date
by:
(A) utilizing any calculations of Exposure for the Transactions
(or Swap Transactions) that the parties have agreed are not in dispute;
(B) calculating the Exposure for the Transactions (or Swap
Transactions) in dispute by seeking four actual quotations at
mid-market from Reference Market-makers for purposes of calculating
Market Quotation, and taking the arithmetic average of those obtained:
PROVIDED that if four quotations are not available for a particular
Transaction (or Swap Transaction), then fewer than four quotations
may be used for that Transaction (or Swap Transaction); and if no
quotations are available for a particular Transaction (or Swap
Transaction), then the Valuation Agent's original calculations will
be used for that Transaction (or Swap Transaction); and
(C) utilizing the procedures specified in Paragraph 13 for calculating
the Value, if disputed, of Posted Credit Support.
(ii) In the case of a dispute involving the Value of any Transfer of
Eligible Credit Support or Posted Credit Support, the Valuation Agent will
recalculate the Value as of the date of Transfer pursuant to Paragraph 13.
Following a recalculation pursuant to this Paragraph, the Valuation Agent
will notify each party (or the other party, if the Valuation Agent is a
party) not later than the Notification Time on the Local Business Day
following the Resolution Time. The appropriate party will, upon demand
following that notice by the Valuation Agent or a resolution pursuant to (3)
above and subject to Paragraphs 4(a) and 4(b), make the appropriate Transfer.
3
PARAGRAPH 6. HOLDING AND USING POSTED COLLATERAL
(a) CARE OF POSTED COLLATERAL. Without limiting the Secured Party's rights
under Paragraph 6(c), the Secured Party will exercise reasonable care to
assure the safe custody of all Posted Collateral to the extent required by
applicable law, and in any event the Secured Party will be deemed to have
exercised reasonable care if it exercises at least the same degree of care
as it would exercise with respect to its own property. Except as specified
in the preceding sentence, the Secured Party will have no duty with respect to
Posted Collateral, including, without limitation, any duty to collect any
Distributions, or enforce or preserve any rights persisting thereto.
(b) ELIGIBILITY TO HOLD POSTED COLLATERAL; CUSTODIANS.
(i) GENERAL. Subject to the satisfaction of any conditions specified in
Paragraph 13 for holding Posted Collateral, the Secured Party will
be entitled to hold Posted Collateral or to appoint an agent (a
"Custodian") to hold Posted Collateral for the Secured Party. Upon
notice by the Secured Party to the Pledgor of the appointment of a
Custodian, the Pledgor's obligations to make any Transfer will be
discharged by making the Transfer to that Custodian. The holding of
Posted Collateral by a Custodian will be deemed to be the holding of
that Posted Collateral by the Secured Party for which the Custodian is
acting.
(ii) FAILURE TO SATISFY CONDITIONS. If the Secured Party or its Custodian
fails to satisfy any conditions for holding Posted Collateral, then upon a
demand made by the Pledgor, the Secured Party will, not later than five
Local Business Days after the demand, Transfer or cause its Custodian to
Transfer all Posted Collateral held by it to a Custodian that satisfies
those conditions or to the Secured Party if it satisfies those conditions.
(iii) LIABILITY. The Secured Party will be liable for the acts or
omissions of its Custodian to the same extent that the Secured Party
would be liable hereunder for its own acts or omissions.
(c) USE OF POSTED COLLATERAL. Unless otherwise specified in Paragraph 13 and
without limiting the rights and obligations of the parties under Paragraphs
3, 4(d)(ii), 5, 6(d) and 8, if the Secured Party is not a Defaulting Party
or an Affected Party with respect to a Specified Condition and no Early
Termination Date has occurred or been designated as the result of an Event of
Default or Specified Condition with respect to the Secured Party, then the
Secured Party will, notwithstanding Section 9-207 of the New York Uniform
Commercial Code, have the right to:
(i) sell, pledge, rehypothecate, assign, invest, use, commingle or
otherwise dispose of, or otherwise use in its business any Posted
Collateral it holds, free from any claim or right of any nature whatsoever
of the Pledgor, including any equity or right of redemption by the Pledgor;
and
(ii) register any Posted Collateral in the name of the Secured Party, its
Custodian or a nominee of either.
For purposes of the obligation to Transfer Eligible Credit Support or Posted
Credit Support pursuant to Paragraphs 3 and 5 and any rights or remedies
authorized under this Agreement, the Secured Party will be deemed to continue
to hold all Posted Collateral and to receive Distributions made thereon,
regardless of whether the Secured Party has exercised any rights with respect
to any Posted Collateral pursuant to (i) or (ii) above.
(d) DISTRIBUTIONS AND INTEREST AMOUNT.
(i) DISTRIBUTIONS. Subject to Paragraph 4(a), if the Secured Party
receives or is deemed to receive Distributions on a Local Business Day, it
will Transfer to the Pledgor not later than the following Local Business Day
any Distributions it receives or is deemed to receive to the extent that a
Delivery Amount would not be created or increased by that Transfer, as
calculated by the Valuation Agent (and the date of calculation will be deemed
to be a Valuation Date for this purpose).
4
(ii) INTEREST AMOUNT. Unless otherwise specified in Paragraph 13 and
subject to Paragraph 4(a), in lieu of any interest, dividends or other
amounts paid or deemed to have been paid with respect to Posted
Collateral in the form of Cash (all of which may be retained by the
Secured Party), the Secured Party will Transfer to the Pledgor at the
times specified in Paragraph 13 the Interest Amount to the extent that a
Delivery Amount would not be created or increased by that Transfer, as
calculated by the Valuation Agent (and the date of calculation will be
deemed to be a Valuation Date for this purpose). The Interest Amount or
portion thereof not Transferred pursuant to this Paragraph will
constitute Posted Collateral in the form of Cash and will be subject to
the security interest granted under Paragraph 2.
PARAGRAPH 7. EVENTS OF DEFAULT
For purposes of Section 5(a)(iii)(1) of this Agreement, an Event of Default
will exist with respect to a party if:
(i) that party fails (or fails to cause its Custodian) to make, when
due, any Transfer of Eligible Collateral, Posted Collateral or the
Interest Amount, as applicable, required to be made by it and that
failure continues for two Local Business Days after notice of that
failure is given to that party;
(ii) that party fails to comply with any restriction or prohibition
specified in this Annex with respect to any of the rights specified in
Paragraph 6(c) and that failure continues for five Local Business Days
after notice of that failure is given to that party; or
(iii) that party fails to comply with or perform any agreement or
obligation other than those specified in Paragraphs 7(i) and 7(ii) and
that failure continues for 30 days after notice of that failure is given
to that party.
PARAGRAPH 8. CERTAIN RIGHTS AND REMEDIES
(a) SECURED PARTY'S RIGHTS AND REMEDIES. If at any time (1) an Event of
Default or Specified Condition with respect to the Pledgor has occurred and
is continuing or (2) an Early Termination Date has occurred or been
designated as the result of an Event of Default or Specified Condition with
respect to the Pledgor, then, unless the Pledgor has paid in full all of its
Obligations that are then due, the Secured Party may exercise one or more of
the following rights and remedies:
(i) all rights and remedies available to a secured party under
applicable law with respect to Posted Collateral held by the Secured
Party;
(ii) any other rights and remedies available to the Secured Party under
the terms of Other Posted Support, if any;
(iii) the right to Set-off any amounts payable by the Pledgor with
respect to any Obligations against any Posted Collateral or the Cash
equivalent of any Posted Collateral held by the Secured Party (or any
obligation of the Secured Party to Transfer that Posted Collateral); and
(iv) the right to liquidate any Posted Collateral held by the Secured
Party through one or more public or private sales or other dispositions
with such notice, if any, as may be required under applicable law, free
from any claim or right of any nature whatsoever of the Pledgor, including
any equity or right of redemption by the Pledgor (with the Secured Party
having the right to purchase any or all of the Posted Collateral to be
sold) and to apply the proceeds (or the Cash equivalent thereof) from
the liquidation of the Posted Collateral to any amounts payable by the
Pledgor with respect to any Obligations in that order as the Secured
Party may elect.
Each party acknowledges and agrees that Posted Collateral in the form of
securities may decline speedily in value and is of a type customarily sold on
a recognized market, and, accordingly, the Pledgor is not entitled to prior
notice of any sale of that Posted Collateral by the Secured Party, except any
notice that is required under applicable law and cannot be waived.
5
(b) PLEDGOR'S RIGHTS AND REMEDIES. If at any time an Early Termination Date
has occurred or been designated as the result of an Event of Default or
Specified Condition with respect to the Secured Party, then (except in the
case of an Early Termination Date relating to less than all Transactions (or
Swap Transactions) where the Secured Party has paid in full all of its
obligations that are then due under Section 6(c) of this Agreement):
(i) the Pledgor may exercise all rights and remedies available to a
pledgor under applicable law with respect to Posted Collateral held by
the Secured Party;
(ii) the Pledgor may exercise any other rights and remedies available to
the Pledgor under the terms of Other Posted Support, if any;
(iii) the Secured Party will be obligated immediately to Transfer all
Posted Collateral and the Interest Amount to the Pledgor; and
(iv) to the extent that Posted Collateral or the Interest Amount is not
so Transferred pursuant to (iii) above, the Pledgor may:
(A) Set-off any amounts payable by the Pledgor with respect to any
Obligations against any Posted Collateral or the Cash equivalent of
any Posted Collateral held by the Secured Party (or any obligation of
the Secured Party to Transfer that Posted Collateral); and
(B) to the extent that the Pledgor does not Set-off under (iv)(A)
above, withhold payments of any remaining amounts payable by the
Pledgor with respect to any Obligations up to the Value of any
remaining Posted Collateral held by the Secured Party, until that
Posted Collateral is Transferred to the Pledgor.
(c) DEFICIENCIES AND EXCESS PROCEEDS. The Secured Party will Transfer to the
Pledgor any proceeds and Posted Credit Support remaining after liquidation.
Set-off and or application under Paragraphs 8(a) and 8(b) after satisfaction
in full of all amounts payable by the Pledgor with respect to any
Obligations; the Pledgor in all events will remain liable for any amounts
remaining unpaid after any liquidation. Set-off and/or application under
Paragraphs 8(a) and 8(b).
(d) FINAL RETURNS. When no amounts are or thereafter may become payable by
the Pledgor with respect to any Obligations (except for any potential
liability under Section 2(d) of this Agreement), the Secured Party will
Transfer to the Pledgor all Posted Credit Support and the Interest Amount, if
any.
PARAGRAPH 9. REPRESENTATIONS
Each party represents to the other party (which representations will be
deemed to be repeated as of each date on which it, as the Pledgor, Transfers
Eligible Collateral) that:
(i) it has the power to grant a security interest in and lien on any
Eligible Collateral it Transfers as the Pledgor and has taken all necessary
actions to authorize the granting of that security interest and lien.
(ii) it is the sole owner of or otherwise has the right to Transfer all
Eligible Collateral it Transfers to the Secured Party hereunder, free and
clear of any security interest, lien, encumbrance or other restrictions
other than the security interest and lien granted under Paragraph 2;
(iii) upon the Transfer of any Eligible Collateral to the Secured Party
under the terms of this Annex, the Secured Party will have a valid and
perfected first priority security interest therein (assuming that any
central clearing corporation or any third-party financial intermediary or
other entity not within the control of the Pledgor involved in the Transfer
of that Eligible Collateral gives the notices and takes the action required
of it under applicable law for perfection of that interest); and
(iv) the performance by its other obligations under this Annex will not
result in the creation of any security interest, lien or other encumbrance
on any Posted Collateral other than the security interest and lien granted
under Paragraph 2.
6
PARAGRAPH 10. EXPENSES
(a) GENERAL. Except as otherwise provided in Paragraphs 10(b) and 10(c),
each party will pay its own costs and expenses in connection with performing
its obligations under this Annex and neither party will be liable for any
costs and expenses incurred by the other party in connection herewith.
(b) POSTED CREDIT SUPPORT. The Pledgor will promptly pay when due all taxes,
assessments or charges of any nature that are imposed with respect to Posted
Credit Support held by the Secured Party upon becoming aware of the same,
regardless of whether any portion of that Posted Credit Support is
subsequently disposed of under Paragraph 6(c), except for those taxes,
assessments and charges that result from the exercise of the Secured Party's
rights under Paragraph 6(c).
(c) LIQUIDATION/APPLICATION OF POSTED CREDIT SUPPORT. All reasonable costs
and expenses incurred by or on behalf of the Secured Party or the Pledgor in
connection with the liquidation and/or application of any Posted Credit
Support under Paragraph 8 will be payable, on demand and pursuant to the
Expenses Section of this Agreement, by the Defaulting Party or, if there is
no Defaulting Party, equally by the parties.
PARAGRAPH 11. MISCELLANEOUS
(a) DEFAULT INTEREST. A Secured Party that fails to make, when due, any
Transfer of Posted Collateral or the Interest Amount will be obligated to pay
the Pledgor (to the extent permitted under applicable law) an amount equal to
interest at the Default Rate multiplied by the Value of the items of property
that were required to be Transferred, from (and including) the date that
Posted Collateral or Interest Amount was required to be Transferred to (but
excluding) the date of Transfer of that Posted Collateral or Interest Amount.
This interest will be calculated on the basis of daily compounding and the
actual number of days elapsed.
(b) FURTHER ASSURANCES. Promptly following a demand made by a party, the
other party will execute, deliver, file and record any financing statement,
specific assignment or other document and take any other action that may be
necessary or desirable and reasonably requested by that party to create,
preserve, perfect or validate any security interest or lien granted under
Paragraph 2, to enable that party to exercise or enforce its rights under this
Annex, with respect to Posted Credit Support or an Interest Amount or to
effect or document a release of a security interest on Posted Collateral or
an Interest Amount.
(c) FURTHER PROTECTION. The Pledgor will promptly give notice to the Secured
Party of, and defend against, any suit, action, proceeding or lien that
involves Posted Credit Support Transferred by the Pledgor or that could
adversely affect the security interest and lien granted by it under
Paragraph 2, unless that suit, action, proceeding or lien results from the
exercise of the Secured Party's rights under Paragraph 6(c).
(d) GOOD FAITH AND COMMERCIALLY REASONABLE MANNER. Performance of all
obligations under this Annex, including, but not limited to, all
calculations, valuations and determinations made by either party, will be
made in good faith and in a commercially reasonable manner.
(e) DEMANDS AND NOTICES. All demands and notices made by a party under this
Annex will be made as specified in the Notices Section of this Agreement,
except as otherwise provided in Paragraph 13.
(f) SPECIFICATIONS OF CERTAIN MATTERS. Anything referred to in this Annex as
being specified in Paragraph 13 also may be specified in one or more
Confirmations or other documents and this Annex will be construed accordingly.
7
PARAGRAPH 12. DEFINITIONS
As used in this Annex:--
"CASH" means the lawful currency of the United States of America.
"CREDIT SUPPORT AMOUNT" has the meaning specified in Paragraph 3.
"CUSTODIAN" has the meaning specified in Paragraphs 6(b))i) and 13.
"DELIVERY AMOUNT" has the meaning specified in Paragraph 3(a).
"DISPUTING PARTY" has the meaning specified in Paragraph 5.
"DISTRIBUTIONS" means with respect to Posted Collateral other than Cash, all
principal, interest and other payments and distributions of cash or other
property with respect hereto, regardless of whether the Secured Party has
disposed of that Posted Collateral under Paragraph 6(c). Distributions will
not include any item of property acquired by the Secured Party upon any
disposition or liquidation of Posted Collateral or, with respect to any Posted
Collateral in the form of Cash, any distributions on that collateral, unless
otherwise specified herein.
"ELIGIBLE COLLATERAL" means, with respect to a party, the items, if any,
specified as such for that party in Paragraph 13.
"ELIGIBLE CREDIT SUPPORT" means Eligible Collateral and Other Eligible
Support.
"EXPOSURE" means for any Valuation Date or other date for which Exposure is
calculated and subject to Paragraph 5 in the case of a dispute, the amount,
if any, that would be payable to a party that is the Secured Party by the
other party (expressed as a positive number) or by a party that is the
Secured Party to the other party (expressed as a negative number) pursuant to
Section 6(e)(ii)(2)(A) of this Agreement as if all Transactions (or Swap
Transactions) were being terminated as of the relevant Valuation Time;
PROVIDED that Market Quotation will be determined by the Valuation Agent
using its estimates at mid-market of the amounts that would be paid for
Replacement Transactions (as that term is defined in the definition of
"Market Quotation").
"INDEPENDENT AMOUNT" means, with respect to a party, the amount specified as
such for that party in Paragraph 13; if no amount is specified, zero.
"INTEREST AMOUNT" means, with respect to an Interest Period, the aggregate
sum of the amounts of interest calculated for each day in that Interest
Period on the principal amount of Posted Collateral in the form of Cash held
by the Secured Party on that day, determined by the Secured Party for each
such day as follows:
(x) the amount of that Cash on that day; multiplied by
(y) the Interest Rate in effect for that day; divided by
(z) 360.
"INTEREST PERIOD" means the period from (and including) the last Local
Business Day on which an Interest Amount was Transferred (or, if no Interest
Amount has yet been Transferred, the Local Business Day on which Posted
Collateral in the form of Cash was Transferred to or received by the Secured
Party) to (but excluding) the Local Business Day on which the current
Interest Amount is to be Transferred.
"INTEREST RATE" means the rate specified in Paragraph 13.
"LOCAL BUSINESS DAY" unless otherwise specified in Paragraph 13, has the
meaning specified in the Definitions Section of this Agreement, except that
references to a payment in clause (b) thereof will be deemed to include a
Transfer under the Annex.
8
"MINIMUM TRANSFER AMOUNT" means, with respect to a party, the amount specified
as much for that party in Paragraph 13: if no amount is specified, zero.
"NOTIFICATION TIME" has the meaning specified in Paragraph 13.
"OBLIGATIONS" means, with respect to a party, all present and future
obligations of that party under this Agreement and any additional obligations
specified for that party in Paragraph 13.
"OTHER ELIGIBLE SUPPORT" means, with respect to a party, the items, if any,
specified as such for that party in Paragraph 13.
"OTHER POSTED SUPPORT" means all Other Eligible Support Transferred to the
Secured Party that remains in effect for the benefit of that Secured Party.
"PLEDGOR" means either party, when that party (i) receives a demand for or is
required to Transfer Eligible Credit Support under Paragraph 3(a) or (ii) has
Transferred Eligible Credit Support under Paragraph 3(a).
"POSTED COLLATERAL" means all Eligible Collateral, other property,
Distributions, and all proceeds thereof that have been Transferred to or
received by the Secured Party under this Annex and not Transferred to the
Pledgor pursuant to Paragraph 3(b), 4(d)(ii) or 6(d)(i) or released by the
Secured Party under Paragraph 8. Any Interest Amount or portion thereof not
Transferred pursuant to Paragraph 6(d)(ii) will constitute Posted Collateral
in the form of Cash.
"POSTED CREDIT SUPPORT" means Posted Collateral and Other Posted Support.
"RECALCULATION DATE" means the Valuation Date that gives rise to the dispute
under Paragraph 5; PROVIDED, HOWEVER, that if a subsequent Valuation Date
occurs under Paragraph 3 prior to the resolution of the dispute, then the
"Recalculation Date" means the most recent Valuation Date under Paragraph 3.
"RESOLUTION TIME" has the meaning specified in Paragraph 13.
"RETURN AMOUNT" has the meaning specified in Paragraph 3(b).
"SECURED PARTY" means either party, when that party (i) makes a demand for or
is entitled to receive Eligible Credit Support under Paragraph 3(a) or (ii)
holds or is deemed to hold Posted Credit Support.
"SPECIFIED CONDITION" means, with respect to a party, any event specified as
such for the party in Paragraph 13.
"SUBSTITUTE CREDIT SUPPORT" has the meaning specified in Paragraph 4(d)(i).
"SUBSTITUTION DATE" has the meanings specified in Paragraph 4(d)(ii).
"THRESHOLD" means, with respect to a party, the amount specified as such for
that party in Paragraph 13; if no amount is specified, zero.
"TRANSFER" means, with respect to any Eligible Credit Support, Posted Credit
Support or Interest Amount, and in accordance with the instructions of the
Secured Party, Pledgor or Custodian, as applicable:
(i) in the case of Cash, payment or delivery by wire transfer into one
or more bank accounts specified by the recipient;
(ii) in the case of certificated securities that cannot be paid or
delivered by book-entry, payment or delivery in appropriate physical form
to the recipient or its account accompanied by any duly executed
instruments of transfer, assignments in blank, transfer tax stamps and any
other documents necessary to constitute a legally valid transfer to the
recipient;
(iii) in the case of securities that can be paid or delivered by
book-entry, the giving of written instructions to the relevant depository,
institution or other entity specified by the recipient, together with a
written copy thereof to the recipient, sufficient if complied with to
result in a legally effective transfer of the relevant interest to the
recipient; and
(iv) in the case of Other Eligible Support or Other Posted Support, as
specified in Paragraph 13.
9
"VALUATION AGENT" has the meaning specified in Paragraph 13.
"VALUATION DUE" means each date specified in or otherwise determined pursuant
to Paragraph 13.
"VALUATION PERCENTAGE" means, for any item of Eligible Collateral, the
percentage specified in Paragraph 13.
"VALUATION TIME" has the meaning specified in Paragraph 13.
"VALUE" means for any Valuation Date or other date for which Value is
calculated and subject to Paragraph 5 in the case of dispute, with respect
to:
(i) Eligible Collateral or Posted Collateral that is:
(A) Cash, the amount thereof; and
(B) a security, the bid price obtained by the Valuation Agent
multiplied by the applicable Valuation Percentage, if any;
(ii) Posted Collateral that consists of items that are not specified as
Eligible Collateral, zero; and
(iii) Other Eligible Support and Other Posted Support, as specified in
Paragraph 13.
10
13. Elections and Variables
(a) SECURITY INTEREST FOR "OBLIGATIONS"
The term "Obligations" as used in this Annex does not include any
additional obligations. For the avoidance of doubt, in respect of the
Obligations which are specified in the Relevant Swap Transactions,
any assumptions made for the purposes of calculating the Peak
Exposure in Paragraph 13(b)(i) or the Benefit Exposure in Paragraph
13(b)(iv)(A) must not be applied or otherwise taken into account for
the purpose of calculating the Obligations, since those assumptions
are theoretical only and do not accurately reflect any actual
Obligations.
(b) CREDIT SUPPORT OBLIGATIONS
(i) DELIVERY AMOUNT, RETURN AMOUNT AND CREDIT SUPPORT AMOUNT
"DELIVERY AMOUNT" and "RETURN AMOUNT" each has the meaning
specified in Paragraph 3.
"CREDIT SUPPORT AMOUNT" means, for any Valuation Date:
(A) (I) with respect to Party A as the Secured Party,
Party A's Exposure for that Valuation Date; or
(II) with respect to Party B as the Secured Party, the
Peak Exposure for that Valuation Date; plus
(B) the aggregate of all Independent Amounts applicable to
the Pledgor, if any; minus
(C) all Independent Amounts applicable to the Secured
Party, if any; minus
(D) the Pledgor's Threshold,
provided, however, that the Credit Support Amount will be
deemed to be zero whenever the calculation of Credit Support
Amount yields a number less than zero.
"PEAK EXPOSURE" means the amount equal to Party B's maximum
credit exposure in respect of a Replacement Transaction entered
into on a date one month after the Valuation Date, calculated
by the Valuation Agent using its swap credit exposure
methodology to the Confidence Interval, as that methodology is
updated to reflect, without limitation, the levels of
volatility current as at the Valuation Time for the
differential between USD-LIBOR-BBA and AUD-BBR-BBSW (each rate
with a Designated Maturity of three months) and the A$-US$
forward exchange rates, and assuming that from that Valuation
Date:
(I) the remaining term of the Relevant Swap
Transaction is calculated on the basis that the
Termination Date is a date, no later than 31
years after the Effective Date of the first
Transaction in respect of the Notes, calculated
by applying the assumptions specified in
subparagraph (II) below;
(II) the Floating Rate Payer Amounts and Exchange
Amounts are calculated on the basis that the
Housing Loan Principal has an amortisation
schedule based on a constant prepayment rate of
10% per annum thereafter,
as each of those terms are defined for the Relevant
Swap Transaction or in the Series Notice applicable to
the Relevant Swap Transaction.
"CONFIDENCE INTERVAL" shall be calculated on the
relevant Valuation Date according to the Joint Rating
(as defined below) as the case may be, as follows:
JOINT RATING Confidence
Interval
A1 (Moody's) and 95%
A+ (S&P) and
A+ (Fitch)
A2 (Moody's) and 97%
A (S&P) and
A (Fitch)
A3 (Moody's) and 99%
A- (S&P) and
A- (Fitch)
(ii) ELIGIBLE COLLATERAL. The following items will qualify as
"Eligible Collateral" for Party A:
Valuation
Percentage
(A) negotiable debt obligations issued by the
U.S. Treasury Department having a remaining
maturity of not more than one year
("Treasury Bills") 98%
(B) negotiable debt obligations issued by the
U.S. Treasury Department having a remaining
maturity of more than one year but not more
than five years
("Treasury Notes") 95%
(C) negotiable debt obligations issued by the
U.S. Treasury Department having a remaining
maturity of more than five years
but not more than ten years ("Treasury Notes") 93%
(D) negotiable debt obligations issued by the
U.S. Treasury Department having a remaining
maturity of more than ten years ("Treasury
Bonds") 90%
(E) Other: Agency Securities having a remaining
maturity of not more than one year 97%
Agency Securities having a remaining
maturity of more than one year but not
more than five years 94%
Agency Securities having a remaining
maturity of more than five years but not
more than ten years 92%
Agency Securities having a remaining
maturity of more than ten years. 89%
"AGENCY SECURITIES" means negotiable debt obligations which are fully
guaranteed as to both principal and interest by the Federal
National Mortgage Association, the Government National Mortgage
Corporation or the Federal Home Loan Mortgage Corporation, but
exclude: (i) interest only and principal only securities; and
(ii) Collateralized Mortgage Obligations, Real Estate Mortgage
Investment Conduits and similar derivative securities.
(iii) OTHER ELIGIBLE SUPPORT
Not applicable.
(iv) THRESHOLDS
(A) "INDEPENDENT AMOUNT" means with respect to Party A, the
Additional Spread.
"ADDITIONAL SPREAD" represents the excess of Party B's
Benefit Exposure over Party B's Exposure, as calculated on
the same Valuation Date according to the Joint Rating (as
defined below) as the case may be, as follows:
Joint Rating Additional
Spread
A1 (Moody's) and 0.15%
A+ (S&P) and
A+ (Fitch)
A2 (Moody's) and 0.20%
A (S&P) and
A (Fitch)
A3 (Moody's) and 0.25%
A- (S&P) and
A- (Fitch)
"BENEFIT EXPOSURE" means the amount equal to Party B's
Exposure, except calculated on the basis that:
(I) the Additional Spread is added to the spread on the
US$ side of the Replacement Transaction; and
(II) the remaining term and the Floating Rate Payer
Amounts and Exchange Amounts for the Replacement
Transaction are calculated by applying the
assumptions specified in subparagraphs (I) and (II)
of the definition of Peak Exposure in paragraph
13(b)(i) above.
For the avoidance of doubt, the Additional Spread is
intended to represent a maximum additional bid/offer spread
of 15, 20 or 25 swap points (as the case may be) running
payable if the bid/offer swap rates quoted to the Secured
Party were adjusted from market rates to the benefit of the
Reference Market-makers.
"INDEPENDENT AMOUNT" means with respect to Party B: Zero.
(B) "THRESHOLD"
With respect to Party A:
(I) if the highest possible jointly supported credit
rating that can be assigned to senior long term debt
jointly supported by Party A and the Credit Support
Provider by Xxxxx'x Investors Service Inc ("MOODY'S")
Standard & Poor's Ratings Group ("S&P") and Fitch
IBCA Inc. ("FITCH") in accordance with Moody's ,
S&P's and Fitch's respective approaches to jointly
supported obligations and after taking into
consideration the nature of the Replacement
Transaction (the "JOINT RATING"), is lower than Aa3
(Moody's), AA-(S&P) or AA-(Fitch) (or, in the case of
no Credit Support Provider providing any credit
support obligations, if the credit rating assigned to
Party A's senior long term debt is lower than Aa3
(Moody's), AA-(S&P) or AA-(Fitch) ) and any Notes
rated Aaa by Moody's, AAA by S&P and AAA by Fitch are
outstanding at that Valuation Date, then zero; or
(II) in all other cases, infinity.
With respect to Party B: infinity.
If either Moody's, S&P or Fitch ceases to be in the business
of rating debt securities and such business is not continued
by a successor or assign of such entity (the "DISCONTINUED
AGENCY"), the parties may jointly select a nationally
recognised credit rating agency in substitution thereof and
agree on the rating level issued by such substitute agency
that is equivalent to the ratings specified herein of the
Discontinued Agency, whereupon such substitute agency and
equivalent rating shall replace the Discontinued Agency and
the rating level thereof for purposes of this Agreement.
(C) "MINIMUM TRANSFER AMOUNT" means with respect to both Party A
and Party B: US$100,000.
(D) ROUNDING. The Delivery Amount and the Return Amount will be
rounded to the nearest integral multiple of US$10,000.
(c) VALUATION AND TIMING
(i) "VALUATION AGENT" means
(A) both Party A and the Credit Support Provider, and the higher
of the valuation amounts of the two parties shall apply. The
valuation amount calculated by Party A and the Credit
Support Provider shall be audited by the parties' respective
internal auditors on a monthly basis for three months after
the inaugural Posted Collateral, and on an annual basis
thereafter; or
(B) if there is no Credit Support Provider, two independent
parties appointed by Party A, and the average of the
valuation amounts calculated by the two independent parties
shall apply.
(ii) "VALUATION DATE" means the last Local Business Day of each week.:
(iii) "VALUATION TIME" means the close of business on the Local
Business Day before the Valuation Date; PROVIDED that the
calculations of Value and Exposure will be made as of
approximately the same time on the same date.
(iv) "NOTIFICATION TIME" means 11:00 am on a Local Business Day.
(d) CONDITIONS PRECEDENT AND SECURED PARTY'S RIGHTS AND REMEDIES
There are no "SPECIFIED CONDITIONS" applicable to Party A and Party B.
(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 11:00 am 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". Not applicable.
(iii) "ALTERNATIVE". The provisions of Paragraph 5 will apply.
(g) HOLDING AND USING POSTED COLLATERAL
(i) ELIGIBILITY TO HOLD POSTED COLLATERAL; CUSTODIANS.
Party A: Not Applicable.
Party B is not entitled to hold Posted Collateral; it must
appoint a Custodian to hold Posted Collateral on its behalf,
pursuant to paragraph
6(b); PROVIDED that the following conditions applicable to
Party B are satisfied:
(A) Party B is not a Defaulting Party;
(B) Party B's Custodian will always be the Principal Paying
Agent of the Notes (in respect of the Relevant Swap
Transaction), unless that party is Party A; and
(C) if the Principal Paying Agent of the Notes (in respect of
the Relevant Swap Transaction) is Party A, then Party B
must appoint a Custodian which is a Bank (as defined in the
Federal Deposit Insurance Act, as amended) outside
Australia, whose rating (with respect to its long term
unsecured, unsubordinated indebtedness) is at all times at
least Aa2 by Moody's, and Party B must notify Party A in
writing of this appointment and of the relevant account for
Paragraph 13(l).
(D) Posted Collateral may only be held in one or more accounts
in the United States and any account established by Party
B's Custodian to hold Posted Collateral shall be
established and maintained for the sole purpose of
receiving deliveries of and holding Posted Collateral.
Separate accounts must be established and maintained in
respect of Posted Collateral transferred to Party B's
Custodian by Party A and the Credit Support Provider
respectively.
(ii) USE OF POSTED COLLATERAL. The provisions of paragraph 6(c) will
not apply to Party B and its Custodian. Party B's Custodian
will permit Party B to secure Party B's obligations under the
relevant Notes by granting to the Security Trustee (as defined
in the Schedule to this Agreement) a mortgage or other security
over Party B's rights in relation to the Posted Collateral, but
subject to Paragraph 11(m)(viii) of this Annex.
(h) DISTRIBUTIONS AND INTEREST AMOUNT
"INTEREST RATE", TRANSFER OF INTEREST AMOUNT, and ALTERNATIVE TO
INTEREST AMOUNT are not applicable.
(i) ADDITIONAL REPRESENTATION(S). NONE.
(j) OTHER ELIGIBLE SUPPORT AND OTHER POSTED SUPPORT
"VALUE" and "TRANSFER" with respect to Other Eligible Support and
Other Posted Support means: not applicable.
(k) DEMANDS AND NOTICES
All demands, specifications and notices under this Annex will be made
pursuant to the Notices Section of this Agreement; PROVIDED, that any
such demand, specification or notice may be made by telephone
("TELEPHONE NOTICE") between duly authorised employees of each party
if such Telephone Notice is confirmed by a subsequent written
instruction (which may be delivered via facsimile) by the close of
business of the same day that such Telephone Notice is given.
(l) ADDRESSES FOR TRANSFERS
Party A: Party A to specify account for returns of collateral,
subject to paragraph 13(x) below.
Party B: Party B must notify Party A of its Custodian's account.
(m) OTHER PROVISIONS
(i) Paragraph 4(b) of the Annex is replaced by the following:
"(b) TRANSFER TIMING. Subject to Paragraph 4(a) and 5 and
unless otherwise specified, if a demand for the Transfer of
Eligible Credit Support or Posted Credit Support is made by the
Notification Time, then the relevant Transfer will be made
within one Local Business Day of receipt of the demand; if a
demand is made after the Notification Time, then the relevant
Transfer will be made within two Local Business Days of receipt
of the demand.
(ii) LOCAL BUSINESS DAY
Unless otherwise specified in the Schedule, the place is
London, New York and Sydney.
(iii) PARTY B'S EXPOSURE
In calculating the amounts of Party B's Exposure, Peak Exposure
and Benefit Exposure under Paragraphs 12, and 13(b)(i) and
13(b)(iv)(A) respectively, the Valuation Agent must:
(A) include all Transactions (or any cashflows under any
Transaction) which correspond with amounts payable on
the Relevant Reset Date by Party B's Principal Paying
Agent in respect of Class A Notes which are then rated
by Xxxxx'x, S&P and/or Fitch with a higher rating than
the then Joint Rating (or in the case of no Credit
Support Provider having any credit support obligations,
the then rating of Party A's senior long term debt); and
(B) exclude all Transactions (or any cashflows under any
Transaction) which do not correspond with amounts
payable on the Relevant Reset Date by Party B's
Principal Paying Agent in respect of Class A Notes which
are then rated by Xxxxx'x, S&P and/or Fitch with the
same or lower rating than the then Joint Rating (or in
the case of no Credit Support Provider having any credit
support obligations, the then rating of Party A's senior
long term debt); and
(C) calculate the Peak Exposure such that it shall not be
less than the Party B's Exposure plus the US$ Equivalent
of 2.5% of the most recently applicable Housing Loan
Principal as at the relevant Valuation Date. The "US$
Equivalent" has the meaning given in the Series Notice
applicable to the Class A Notes.
For the purposes of this Paragraph (m)(iii), "Relevant Reset
Date" means:
(C) if a Reset Date occurs on the relevant Valuation Date,
then that Valuation Date; or
(D) if a Reset Date does not occur on the relevant Valuation
Date, then the next Reset Date.
(iv) EVENT OF DEFAULT, NOT POTENTIAL EVENT OF DEFAULT OR SPECIFIED
CONDITION AND NEW PARAGRAPH 3(C)
A new Paragraph 3(c) of the Annex is added as follows:
"(c) JOINT RATINGS BELOW SPECIFIED LEVELS. If at any time the
Joint Rating is lower than A-(S&P) and A-(Fitch) (or, in the
case of no Credit Support Provider providing any credit
support obligations, if the credit rating assigned to Party
A's senior long term debt is lower than A-(S&P) and A-(Fitch)
) or the short term rating-equivalent of the Joint Rating is
lower than A-1 (S&P) and F-1 (Fitch), then Party A and the
Credit Support Provider must replace the Currency Swap
Provider or take measures which are acceptable to the relevant
rating agency at the time.
Paragraph 4(a)(i) and 4(a)(ii) of the Annex are amended by
deleting the words "Potential Event of Default or Specified
Condition" and "or Specified Condition" respectively.
Paragraph 6(c) of the Annex is amended by deleting the words
"or an Affected Party with respect to a Specified Condition"
on lines 3 and 4 and "or Specified Condition" on lines 5 and
6.
Paragraph 7(i) of the Annex is amended, on line 3, by
replacing "two Local Business Days" with "three Local Business
Days".
Paragraph 8(a)(1) and 8(a)(2) of the Annex are amended by
deleting the words "or Specified Condition".
(v) PARTY B'S EXPENSES
Party A acknowledges that, pursuant to Section 17 of the
Agreement, Party B will pay its own costs and expenses under
Paragraph 10(a) from proceeds distributed as Trustee's
expenses, in accordance with instructions from the Trustee.
(vi) GOVERNING LAW NOTWITHSTANDING
This Annex shall be governed by and construed in accordance
with the laws of the state of New York without giving effect
to choice of law doctrine and parties hereto agree that
proceedings relating to any dispute arising out of or in
connection with this Annex shall be subject to the
non-exclusive jurisdiction of the federal or state courts of
competent jurisdiction in the Borough of Manhattan in New York
City, State of New York.
(vii) NO TRIAL BY JURY
Each party waives, to the fullest extent permitted by
applicable law, any right it may have to a trial by jury in
respect of any suit, action or proceeding relating to this
Annex.
(viii) NO POOLING OF COLLATERAL WITH OTHER SECURITY TRUST SECURITY
Notwithstanding any provision in any Trust Document (as
defined in the Security Trust Deed), but without prejudice to
Party B's rights under Paragraph 8(a) of this Annex, no party
shall be entitled to deal with the Posted Collateral in any
manner inconsistent with the rights of the Pledgor and the
Credit Support Provider under Paragraphs 8(b)(iii) and 13(x)
of this Annex, and each party covenants to the other that it
shall not permit any other person to gain any rights in
relation to the Posted Collateral that are inconsistent with
the rights of the Pledgor and the Credit Support Provider.
(ix) CREDIT SUPPORT PROVIDER
For valuable consideration which is hereby acknowledged by the
Credit Support Provider as having been received, the Credit
Support Provider hereby unconditionally guarantees the
obligations of Party A under this Annex, on the following
terms:
(A) If Party A shall in any respect fail to perform its
obligations as Pledgor under this Annex and the breach
is not remedied within any applicable grace period set
out in paragraph 7 of this Annex, the Credit Support
Provider shall perform the obligations of Party A as
Pledgor under and in accordance with this Annex;
(B) Subject to paragraph 13(m)(ix)(E) Party B must return
to the Credit Support Provider any Posted Collateral
which the Credit Support Provider has transferred to
Party B pursuant to paragraph 13(m)(ix)(A),
notwithstanding that any such Posted Collateral was
transferred by the Credit Support Provider to Party B
to secure the Obligations of Party A. The Credit
Support Provider shall be the "Pledgor" for the
purposes of Party B returning Posted Collateral in
accordance with this sub-paragraph and the provisions
in this Annex for the return of Posted Collateral shall
otherwise apply for returns of Posted Collateral by
Party B to the Credit Support Provider;
(C) The provisions of this paragraph 13(m)(ix) shall
constitute irrevocable obligations of the Credit
Support Provider until a notice
of revocation is served by the Credit Support Provider
on Party B. Such a notice shall not be served without
the prior written consent of Party A and the Manager in
consultation with the Designated Rating Agencies; and
(D) The Credit Support Provider shall not be discharged or
released from its obligations under this Annex and this
Agreement (including, without limitation, the
obligations under Section 20) by any agreement,
conduct, omission, breach or repudiation by Party A or
Party B, or any other act, event or circumstance which
but for this clause would or might operate as a matter
of law to discharge, impair or otherwise affect any of
the obligations of the Credit Support Provider under
this Annex or this Agreement.
(E) If the Credit Support Provider transfers Eligible
Collateral to Party B under paragraph 13(m)(ix)(A) (the
"CSP POSTED COLLATERAL") and Transactions are
terminated in accordance with Section 21 of the Other
Agreement (as defined in Section 20 of this Agreement),
then Party B will transfer the CSP Posted Collateral to
Party A (or its Custodian). Party A (or its Custodian)
shall hold CSP Posted Collateral as security for
obligations owed by the Credit Support Provider to
Party A in connection with any such terminated
Transactions, including, without limitation, any xxxx
to market amounts payable in respect thereof.
(x) PARTY A'S COLLATERAL AND THE CREDIT SUPPORT PROVIDER
(A) If Party A transfers Eligible Collateral to Party B
under this Annex (the "Party A Posted Collateral") and
then a Substitution Notice is given by the Credit
Support Provider and the Replaced Transaction is
terminated in accordance with section 21 of the
Agreement, then Party B will transfer the Party A
Posted Collateral to a Custodian as specified by Party
A in accordance with paragraph (x)(B) below.
(B) If a Substitution Notice is given in accordance with
section 21 of this Agreement, Party B shall transfer
the Party A Posted Collateral (if any) to the Credit
Support Provider (or its Custodian) as if the Credit
Support Provider (or its Custodian) were the "Pledgor"
for the purposes of returning Posted Collateral under
paragraph 3(b), and otherwise in accordance with
paragraph 3(b). Party B must transfer the Party A
Posted Collateral on or by the Effective Date of the
Substitute Transaction or the Equivalent-Other
Transaction (as specified under section 21 of this
Agreement).
(C) The Credit Support Provider (or its Custodian) shall
hold the Party A Posted Collateral as security for
obligations owed by Party A to the Credit Support
Provider in connection with the terminated Transactions
including without limitation any xxxx to market amounts
payable in respect thereof.
(D) The Transfer of the Party A Posted Collateral by Party
B in accordance with paragraph (x)(B) shall constitute
performance by Party B of its obligations under
paragraph 3(b) in respect of the
Party A Posted Collateral, and Party A's rights in
respect of the Party A Posted Collateral under
paragraph 8 (b)(iii) shall be deemed to be modified by
the provisions of this paragraph 13(x).
WESTPAC BANKING CORPORATION
[13 May 1999]
Westpac Securities Administration Limited
in its capacity as trustee of the Series 0000-0X XXX Trust
Xxxxx 00, 000 Xxxx Xxxxxx
Xxxxxx
cc: Westpac Securitisation Management Pty Limited
Xxxxx 00, 00 Xxxxxx Xxxxx
Xxxxxx
Xxxxxx Guaranty Trust Company of New York
XX Xxx 000
61 Victoria Embankment
Xxxxxx XX0X 0XX
Dear Sir
CURRENCY SWAP TRANSACTIONS - SERIES 1999-1G WST TRUST
CLASS A MORTGAGE BACKED FLOATING RATE NOTES
The purpose of this letter is to confirm the terms and conditions of the swap
transactions entered into between us on the Trade Dates specified below (the
"TRANSACTIONS"). This letter constitutes a "Confirmation" as referred to in the
Master Agreement specified below.
1. This Confirmation supplements, forms part of, and is subject to, the
Master Agreement dated [10 May 1999], as amended and supplemented from
time to time (the "AGREEMENT") between you and us. All provisions
contained in the Agreement govern this Confirmation except as expressly
modified below. Without limitation, Section 21 of the Agreement shall
apply to this Confirmation and the Transactions under it, as further
specified below.
2. Terms defined in the Conditions dated [10 May 1999] in respect of the
issue of US$[XXX] in Class A Mortgage-Backed Floating Rate Notes due
2030 have the same meanings when used in this Confirmation.
3. The terms of the particular Transaction to which this Confirmation
relate are as specified in the Annexures 1, 2 and 3 to this
Confirmation, in respect of Class A Notes, Class A Notes - "Substitute
Transaction" and Class A Notes - "Equivalent-Other Transaction"
respectively.
4. For the purposes of this Confirmation, Westpac Banking Corporation is
known as ,"WESTPAC", Westpac Securities Administration Limited in its
WESTPAC BANKING CORPORATION
capacity as trustee of the Series 0000-0X XXX Xxxxx is known as
"TRUSTEE", Westpac Securitisation Management Pty Limited is known as
"MANAGER" and Xxxxxx Guaranty Trust Company of New York, London Office,
is known as "CREDIT SUPPORT PROVIDER".
5. Account Details
Payments to Westpac: to be advised
Payments to Trustee: to be advised
6. Offices
(a) The Office of Westpac for the Swap Transactions is [LONDON - IS
THIS STILL CORRECT?]; and (b) The Office of the Trustee for the Swap
Transactions is SYDNEY.
Yours sincerely,
WESTPAC BANKING CORPORATION
(ARBN 007 457 141)
By:
Name:
Title:
Confirmed as of the
date above first written:
WESTPAC SECURITIES ADMINISTRATION LIMITED(ACN 000 049 472)
in its capacity as trustee of the Series 0000-0X XXX Trust
By:
-----------------------------
Name:
Title:
WESTPAC SECURITISATION MANAGEMENT PTY LIMITED (ACN 000 000 000)
in its capacity as Trust Manager
By:
-----------------------------
Name:
Title:
WESTPAC BANKING CORPORATION
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK in its capacity as Credit
Support Provider to Westpac
By:
-----------------------------
Name:
Title:
WESTPAC BANKING CORPORATION
ANNEXURE 1 - CLASS A NOTES
Westpac Deal Number
Trade Date: [13 May 1999]
Effective Date: Closing Date
Termination Date: Final Maturity Date (adjusted in
accordance with the [Modified] Following
Business Day Convention)
FLOATING INTEREST AMOUNTS
FLOATING AMOUNTS PAYABLE BY WESTPAC:
These Floating Amounts are payable by Westpac unless there is, on any Floating
Rate Payer Payment Date, any reduction in Class A Interest resulting from a
reduction in A$ Class A Interest Amount pursuant to clause 6.17(a)(ii)(A) of the
Series Notice (as specified in a notice to Westpac by the Determination Time),
in which case the Floating Amount shall be reduced by the same proportion as the
reduction in the A$ Class A Interest Amount.
Floating Rate Payer: Westpac
Notional Amount: An amount equal to fifty (50) percent of
the total Invested Amount of all Class A
Notes as at the first day of the
Interest Period ending on but excluding
the relevant Floating Rate Payer Payment
Date
Floating Rate Payer Payment Dates: Each Payment Date up to and including
the last Payment Date prior to the
Maturity Date, and the Termination Date
Floating Rate Option: USD-LIBOR-BBA
Designated Maturity: Three months
Spread: Plus [0.XXXX] percent
WESTPAC BANKING CORPORATION
Floating Rate Day Count Fraction: Actual/360
Reset Dates: The first day of each Interest Period
Compounding: Inapplicable
WESTPAC BANKING CORPORATION
FLOATING AMOUNTS PAYABLE BY THE TRUSTEE:
These Floating Amounts are payable by the Trustee unless there is, on any
Floating Rate Payer Payment Date, any reduction in A$ Class A Interest Amount
pursuant to clause 6.17(a)(ii)(A) of the Series Notice (as specified in a notice
by the Trustee or Trust Manager to Westpac by the Determination Time), in which
case, instead of the Floating Amount, the Trustee shall pay an amount equal to
the lesser A$ amount specified in that notice on that Floating Rate Payer
Payment Date.
Floating Rate Payer: Trustee
Notional Amount: An amount equal to fifty (50) percent of
the A$ Equivalent (applying USD
0.XXXXXX) of the total Invested Amount
of all Class A Notes as at the first day
of the Interest Period ending on but
excluding the relevant Floating Rate
Payer Payment Date
Floating Rate Payer Payment Dates: Each Payment Date up to and including
the last Payment Date prior to the
Maturity Date, and the Termination Date
Floating Rate Option: AUD-BBR-BBSW
Designated Maturity: 90 days
Spread: Plus 0.XXXX percent
Floating Rate Day Count Fraction: Actual/365 (Fixed)
Reset Dates: The first day of each Interest Period
Compounding: Inapplicable
WESTPAC BANKING CORPORATION
EXCHANGES
INITIAL EXCHANGE:
Initial Exchange Date: Closing Date
Westpac Pays Initial Exchange: An amount equal to fifty (50) percent of
the total Class A Initial Invested
Amount of all Class A Notes on the
Closing Date divided by the exchange
rate of USD 0.XXXXXX being (AUD [XXX])
Trustee Pays Initial Exchange: An amount equal to fifty (50) percent of
the total of the Class A Initial
Invested Amount of all of the Class A
Notes on the Closing Date being USD
[XXX]
INSTALMENT EXCHANGE
Instalment Exchange Date Each Payment Date (other than a Final
Exchange Date)
Westpac Pays Instalment Exchange: An amount equal to fifty (50) percent of
the Class A Principal Payment paid on
the relevant Instalment Exchange Date
towards a reduction of the Principal
Amount of Class A Notes, as calculated
by multiplying the Trustee Instalment
Exchange Payment on the relevant
Instalment Exchange Date by the exchange
rate of USD 0.XXXXXX
WESTPAC BANKING CORPORATION
Trustee Pays Instalment Exchange: An amount equal to fifty (50) percent of
the amount expressed under clause 6.14,
6.15 or 6.16 (as applicable) of the
Series Notice as being payable under a
Confirmation relating to Class A Notes
plus any amount payable under clause
6.11(a)(ii)(C) of the Series Notice
(together, the "TRUSTEE INSTALMENT
EXCHANGE PAYMENT") as specified in the
notice issued by the Trustee (or the
Trust Manager) to Westpac by the
Determination Time in respect of that
Instalment Exchange Date
WESTPAC BANKING CORPORATION
FINAL EXCHANGE:
Final Exchange Date: The earlier of the Termination Date and
the Date of the 10% Clean Up under
clause 8.9(d) of the Master Trust Deed
as amended by the Series Notice and the
date of redemption of all the Class A
Notes for taxation or other reasons,
adjusted in accordance with the
[Modified] Following Business Day
Convention
Westpac Pays Final Exchange: An amount equal to fifty (50) percent of
the aggregate Final Exchange payable by
the Trustee under this Confirmation,
multiplied by the exchange rate of USD
0. XXXXXX
Trustee Pays Final Exchange: An amount equal to fifty (50) percent of
the aggregate amount expressed under
clause 6.14, 6.15 or 6.16 (as
applicable) of the Series Notice as
being payable under a Confirmation
relating to Class A Notes plus any
amount payable under clause
6.11(a)(ii)(C) of the Series Notice as
specified in the Notice issued by the
Trustee (or the Trust Manager) to
Westpac by the Determination Time in
respect of that Final Exchange Date
Business Day Locations for Trustee: Sydney
Business Day Locations for Westpac: [New York, London - OR LONDON, SYDNEY?]
Payments will be: Gross
WESTPAC BANKING CORPORATION
GLOSSARY
1. Terms defined in the Series Notice:
A$ Equivalent Invested Amount
Class A Initial Invested Amount Maturity Date
Class A Notes Payment Date
Closing Date Principal Payment
Interest Period Trust Manager
2. Terms defined in the Agreement (including 1991 ISDA Definitions) are:
Actual/360
Actual/365 (Fixed)
AUD-BBR-BBSW
[Modified] Following Business Day Convention
Replaced Transaction
USD-LIBOR-BBA
3. Terms defined in this Confirmation:
Agreement
Trustee
"Determination Time" means 5.00 pm Sydney time 4 Sydney Business Days prior to
the relevant Payment Date or other applicable exchange date.
Westpac
CREDIT SUPPORT PROVIDER PROVISIONS
This Transaction shall be capable of being specified as a Replaced Transaction
in accordance with Section 21 of the Agreement. Those provisions shall apply as
further specified below.
1. Definitions for Credit Events
"CALCULATION AGENT" means the Credit Support Provider or such other
party designated as such for the Transaction. The Calculation Agent's
calculations and determinations shall be made in good faith, in a
WESTPAC BANKING CORPORATION
commercially reasonable manner and be binding in the absence of
manifest error;
"INITIAL PRICE" means, with respect to any Reference Obligation, the
percentage listed with respect thereto in the definition of Reference
Obligation herein as the Initial Price;
"INTEREST RATE ADJUSTMENT AMOUNT" means, with respect to any Reference
Obligation, the difference between (i) the Xxxx to Market Value and
(ii) 100% minus the Initial Price;
"XXXX TO MARKET RATE" means the Xxxx to Market Rate specified in
respect of the Reference Obligation;
"XXXX TO MARKET VALUE" means, in the determination of the Calculation
Agent, with respect to any Reference Obligation, on any day, the xxxx
to market value payable on that day (expressed as a percentage of the
notional amount thereof), of a hypothetical interest rate swap
commencing on the Effective Date between a hypothetical party ("Party
X") and a counterparty with the highest long term senior debt rating of
each Rating Agency, which swap has a notional amount equal to
US$100,000,000 and under which Party X (i) receives the Xxxx to Market
Rate plus the Initial Spread and (ii) pays a fixed interest amount
equal in amount and timing to the coupons on the Reference Obligation
(except a notional amount of $100,000,000 shall be applied). If, under
such swap, Party X would be due to pay such xxxx to market value, Xxxx
to Market Value will be negative and, if Party X would be due to
receive such xxxx to market value, the Xxxx to Market Value will be
positive.
"MARKET VALUE" means, in accordance with the Quotation Method, the
percentage equal to the arithmetic mean of quotations (exclusive of
accrued but unpaid interest and expressed as a percentage) obtained
from Dealers with respect to a Valuation Date in the manner provided
below. In obtaining such price quotations from Dealers, the Calculation
Agent will request each Dealer to provide firm bid and offer quotations
for an aggregate amount of the Reference Obligation equal to the
Quotation Amount to the extent reasonably practicable as of the
Valuation Time on such Valuation Date. If more than three quotations
are provided on such date, the Market Value shall be the arithmetic
mean of such quotations without regard to the quotations having the
highest and lowest values. If exactly three quotations are provided,
the Market Value shall 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 exactly two quotations are
provided, the Market Value shall be the arithmetic mean of such
quotations. If fewer than two quotations are provided, then the Market
Value shall be an amount as determined by the Calculation Agent on the
next Business Day on which
WESTPAC BANKING CORPORATION
at least two quotations are provided by Dealers. If the Calculation
Agent is unable to calculate the Market Value prior to the fifth
Business Day following the applicable Valuation Date, then the
Calculation Agent shall determine the Market Value for such Valuation
Date in its reasonable discretion;
"PRICE DECLINE REQUIREMENT" means the product of 1.5% and the modified
duration of the Reference Obligation at the time of calculation;
"QUOTATION METHOD":
Mid-market means that only the arithmetic mean of the bid and
offer quotations provided by Dealers that have provided both
bid and offer quotations shall be used in the calculation of
Market Value;
"REFERENCE OBLIGATION" means the obligation(s) as follows:
Issuer/Borrower: Westpac Banking Corporation
Maturity: [Specify]
Coupon: X[OBJECT OMITTED]%
CUSIP/ISIN: CUSIP TT X/ ISIN XS X
Original Issue Amount: USDXXX
Initial Price: X%
Initial Spread: X[OBJECT OMITTED]% U.S.Treasury Notes
due XX/XX/XXXX plus X%;
Xxxx to Market Rate Yield to maturity of X[OBJECT OMITTED]%
U.S.Treasury Notes due
XX/XX/XXXX
CHANGES WITH RESPECT TO ANY REFERENCE OBLIGATION. In the event that the
aggregate outstanding principal amount of any Reference Obligation has,
in the opinion of the Calculation Agent, been materially reduced by
redemption or otherwise (other than due to any regularly scheduled
amortization or prepayments), then the Calculation Agent, after
consultation with the parties, shall identify a substitute obligation
which ranks equal in priority of payment with such Reference Obligation
and is issued or guaranteed (as to both principal and interest) by the
same issuer and/or guarantor to replace the Reference Obligation. Upon
notice to the parties of a substitute obligation having been identified
by the Calculation Agent, such substitute obligation shall without
further action replace the Reference Obligation.
"SPECIFIED INDEBTEDNESS" means any obligation (whether present or
future, contingent or otherwise, as principal or surety or otherwise)
in respect of money borrowed or raised or under any finance lease,
redeemable preference share, letter of credit, futures contract,
guarantee, indemnity or a
WESTPAC BANKING CORPORATION
transaction of a type described in the last 6 lines of the definition
of Specified Transaction.
"THRESHOLD AMOUNT" means US$50,000,000
"VALUATION TIME" means 10.00am London Time
2. The parties acknowledge that on the Effective Date of the Substitute
Transaction or the Equivalent Transaction, Party A shall pay to the
Credit Support Provider (in the case of the Substitute Transaction) or
to the new Currency Swap Provider (in the case of the Equivalent
Transaction) the amount equal to the amount (if a positive number) that
hypothetically would have been payable by Party A to Party B under
Section 6(e)(i)(3) if:
(a) the Transaction had been terminated;
(b) an Early Termination Date had occurred on the Effective Date; and
(c) Section 21 had not applied in respect of the Transaction.
Any such amount shall be payable by Party A to, as the case may be,
either the Credit Support Provider in accordance with the provisions of
the side agreement between them dated on or about the Trade Date of
this Transaction (in the case of the Substitute Transaction), or the
New Currency Swap Provider in accordance with the relevant Master
Agreement between Party A and the New Currency Swap Provider (in the
case of the Equivalent Transaction).
Westpac Banking Corporation
Annexure 2 - Class A Notes - "Substitute Transaction"
Westpac Deal Number
Trade Date: [13 May 1999]
Effective Date: The Effective Date shall be the date
specified in a Substitution Notice given by
Westpac as Credit Support Provider under and
in accordance with Section 21 of the Other
Agreement.
The Effective Date shall not occur if the
conditions in respect of the Substitution
Notice have not been satisfied in full in
accordance with the Other Agreement.
Termination Date: Final Maturity Date (adjusted in accordance
with the [Modified] Following Business Day
Convention)
Floating Interest Amounts
Floating Amounts Payable by Westpac:
These Floating Amounts are payable by Westpac unless there is, on any Floating
Rate Payer Payment Date, any reduction in Class A Interest resulting from a
reduction in A$ Class A Interest Amount pursuant to clause 6.17(a)(ii)(A) of the
Series Notice (as specified in a notice to Westpac by the Determination Time),
in which case the Floating Amount shall be reduced by the same proportion as the
reduction in the A$ Class A Interest Amount.
Floating Rate Payer: Westpac
Notional Amount: An amount equal to the total Invested Amount
of all Class A Notes as at the first day of
the Interest Period ending on but excluding
the relevant Floating Rate Payer Payment
Date
WESTPAC BANKING CORPORATION
Floating Rate Payer Payment Dates: Each Payment Date on or after the Effective
Date up to, and including the last Payment
Date prior to Maturity Date, and the
Termination Date
Floating Rate Option: USD-LIBOR-BBA
Designated Maturity: Three months
Spread: Plus 0.XXXX percent
Floating Rate Day Count Fraction: Actual/360
Reset Dates: The first day of each Interest Period
Compounding: Inapplicable
Floating Amounts Payable by the Trustee:
These Floating Amounts are payable by the Trustee unless there is, on any
Floating Rate Payer Payment Date, any reduction in A$ Class A Interest Amount
pursuant to clause 6.17(a)(ii)(A) of the Series Notice (as specified in a notice
by the Trustee or the Trust Manager to Westpac by the Determination Time), in
which case, instead of the Floating Amount, the Trustee shall pay an amount
equal to the lesser A$ amount specified in that notice on that Floating Rate
Payer Payment Date.
Floating Rate Payer: Trustee
Notional Amount: An amount equal to the A$ Equivalent
(applying USD 0.XXXXXX) of the total
Invested Amount of all Class A Notes as at
the first day of the Interest Period ending
on but excluding the relevant Floating Rate
Payer Payment Date
Floating Rate Payer Payment Dates: Each Payment Date on or after the Effective
Date up to and including the last Payment
Date prior to the Maturity Date, and the
Termination Date
Floating Rate Option: AUD-BBR-BBSW
Designated Maturity: 90 days
WESTPAC BANKING CORPORATION
Spread: Plus 0.XXXX percent
Floating Rate Day Count Fraction: Actual/365 (Fixed)
Reset Dates: The first day of each Interest Period
Compounding: Inapplicable
Exchanges
Instalment Exchange
Instalment Exchange Date Each Payment Date on or after the Effective
Date (other than a Final Exchange Date)
Westpac Pays Instalment Exchange: An amount equal to the Class A Principal
Payment paid on the relevant Instalment
Exchange Date towards a reduction of the
Principal Amount of Class A Notes, as
calculated by multiplying the Trustee
Instalment Exchange Payment on the relevant
Instalment Exchange Date by the exchange
rate of USD 0.XXXXXX
Trustee Pays Instalment Exchange: An amount equal to the amount expressed
under clause 6.14, 6.15 or 6.16 (as
applicable) of the Series Notice as being
payable under a Confirmation relating to
Class A Notes plus any amount payable under
clause 6.11(a)(ii)(C) of the Series Notice
(together, the "Trustee Instalment Exchange
Payment") as specified in the notice issued
by the Trustee (or the Trust Manager) to
Westpac by the Determination Time in respect
of that Instalment Exchange Date
Final Exchange:
Final Exchange Date: The earlier of the Termination Date and the
Date of the 10% Clean Up under clause 8.9(d)
of the Master Trust Deed as amended by the
Series Notice and the date of redemption of
all the Class A Notes for taxation or other
reasons, adjusted in accordance with the
[Modified] Following Business Day Convention
WESTPAC BANKING CORPORATION
Westpac Pays Final Exchange: An amount equal to the aggregate Final
Exchange payable by the Trustee under this
Confirmation, multiplied by the exchange
rate of USD 0.XXXXXX
Trustee Pays Final Exchange: An amount equal to the aggregate amount
expressed under clause 6.14, 6.15 or 6.16
(as applicable) of the Series Notice as
being payable under a Confirmation relating
to Class A Notes plus any amount payable
under clause 6.11(a)(ii)(C) of the Series
Notice as specified in the Notice issued by
the Trustee (or the Trust Manager) to
Westpac by the Determination Time in respect
of that Final Exchange Date
Business Day Locations for Trustee: Sydney
Business Day Locations for Westpac: [New York, London - or London, Sydney?]
Payments will be: Gross
WESTPAC BANKING CORPORATION
Glossary
1. Terms defined in the Series Notice:
A$ Equivalent Invested Amount
Class A Initial Invested Amount Maturity Date
Class A Notes Payment Date
Closing Date Principal Payment
Interest Period Trust Manager
2. Terms defined in the Agreement (including 1991 ISDA Definitions) are:
Actual/360
Actual/365 (Fixed)
AUD-BBR-BBSW
[Modified] Following Business Day Convention
Other Agreement. For the avoidance of doubt, the Other Agreement is the
agreement between Xxxxxx Guaranty Trust Company of New York as Party A, the
Trustee as Party B, Westpac as the Credit Support Provider to Party A and the
Manager, dated on or about the date of the Agreement, on the same material terms
as the Agreement.
Substitution Notice
USD-LIBOR-BBA
3. Terms defined in this Confirmation:
Agreement
Trustee
"Determination Time" means 5.00 pm Sydney time 4 Sydney Business Days prior to
the relevant Payment Date or other applicable exchange date.
Westpac
WESTPAC BANKING CORPORATION
Annexure 3 - Class A Notes -"Equivalent-Other Transaction"
Westpac Deal Number
Trade Date: [13 May 1999]
Effective Date: The Effective Date shall be the date
specified in a Substitution Notice given by
Westpac as Credit Support Provider under and
in accordance with Section 21 of the Other
Agreement.
The Effective Date shall not occur if the
conditions in respect of the Substitution
Notice have not been satisfied in full in
accordance with the Other Agreement.
Termination Date: Final Maturity Date (adjusted in accordance
with the [Modified] Following Business Day
Convention)
Floating Interest Amounts
Floating Amounts Payable by Westpac:
These Floating Amounts are payable by Westpac unless there is, on any Floating
Rate Payer Payment Date, any reduction in Class A Interest resulting from a
reduction in A$ Class A Interest Amount pursuant to clause 6.17(a)(ii)(A) of the
Series Notice (as specified in a notice to Westpac by the Determination Time),
in which case the Floating Amount shall be reduced by the same proportion as the
reduction in the A$ Class A Interest Amount.
Floating Rate Payer: Westpac
Notional Amount: An amount equal to fifty (50) percent of the
total Invested Amount of all Class A Notes
as at the first day of the Interest Period
ending on but excluding the relevant
Floating Rate Payer Payment Date
WESTPAC BANKING CORPORATION
Floating Rate Payer Payment Dates: Each Payment Date on or after the Effective
Date up to and including the last Payment
Date prior to Maturity Date, and the
Termination Date
Floating Rate Option: USD-LIBOR-BBA
Designated Maturity: Three months
Spread: Plus O.XXXX percent
Floating Rate Day Count Fraction: Actual/360
Reset Dates: The first day of each Interest Period
Compounding: Inapplicable
Floating Amounts Payable by the Trustee:
These Floating Amounts are payable by the Trustee unless there is, on any
Floating Rate Payer Payment Date, any reduction in A$ Class A Interest Amount
pursuant to clause 6.17(a)(ii)(A) of the Series Notice (as specified in a notice
by the Trustee or Trust Manager to Westpac by the Determination Time), in which
case, instead of the Floating Amount, the Trustee shall pay an amount equal to
the lesser A$ amount specified in that notice on that Floating Rate Payer
Payment Date.
Floating Rate Payer: Trustee
Notional Amount: An amount equal to fifty (50) percent of the
A$ Equivalent (applying USD 0.XXXXXX) of the
total Invested Amount of all Class A Notes
as at the first day of the Interest Period
ending on but excluding the relevant
Floating Rate Payer Payment Date
Floating Rate Payer Payment Dates: Each Payment Date on or after the Effective
Date up to and including the last Payment
Date prior to the Maturity Date, and the
Termination Date
Floating Rate Option: AUD-BBR-BBSW
Designated Maturity: 90 days
Spread: Plus 0.XXXX percent
Floating Rate Day Count Fraction: Actual/365 (Fixed)
Reset Dates: The first day of each Interest Period
Compounding: Inapplicable
WESTPAC BANKING CORPORATION
Exchanges
Instalment Exchange
Instalment Exchange Date Each Payment Date on or after the Effective
Date (other than a Final Exchange Date)
Westpac Pays Instalment Exchange: An amount equal to fifty (50) percent of the
Class A Principal Payment paid on the
relevant Instalment Exchange Date towards a
reduction of the Principal Amount of Class A
Notes, as calculated by multiplying the
Trustee Instalment Exchange Payment on the
relevant Instalment Exchange Date by the
exchange rate of USD 0.XXXXXX
Trustee Pays Instalment Exchange: An amount equal to fifty (50) percent of the
amount expressed under clause 6.14, 6.15 or
6.16 (as applicable) of the Series Notice as
being payable under a Confirmation relating
to Class A Notes plus any amount payable
under clause 6.11(a)(ii)(C) of the Series
Notice (together, the "Trustee Instalment
Exchange Payment") as specified in the
notice issued by the Trustee (or the Trust
Manager) to Westpac by the Determination
Time in respect of that Instalment Exchange
Date
WESTPAC BANKING CORPORATION
Final Exchange:
Final Exchange Date: The earlier of the Termination Date and the
Date of the 10% Clean Up under clause 8.9(d)
of the Master Trust Deed as amended by the
Series Notice and the date of redemption of
all the Class A Notes for taxation or other
reasons, adjusted in accordance with the
[Modified] Following Business Day Convention
Westpac Pays Final Exchange: An amount equal to fifty (50) percent of the
aggregate Final Exchange payable by the
Trustee under this Confirmation, multiplied
by the exchange rate of USD 0.XXXXXX
Trustee Pays Final Exchange: An amount equal to fifty (50) percent of the
aggregate amount expressed under clause
6.14, 6.15 or 6.16 (as applicable) of the
Series Notice as being payable under a
Confirmation relating to Class A Notes plus
any amount payable under clause
6.11(a)(ii)(C) of the Series Notice as
specified in the Notice issued by the
Trustee (or the Trust Manager) to Westpac by
the Determination Time in respect of that
Final Exchange Date
Business Day Locations for Trustee: Sydney
Business Day Locations for Westpac: [New York, London - or London, Sydney?]
Payments will be: Gross
WESTPAC BANKING CORPORATION
Glossary
1. Terms defined in the Series Notice:
A$ Equivalent Invested Amount
Class A Initial Invested Amount Maturity Date
Class A Notes Payment Date
Closing Date Principal Payment
Interest Period Trust Manager
2. Terms defined in the Agreement (including 1991 ISDA Definitions) are:
Actual/360
Actual/365 (Fixed)
AUD-BBR-BBSW
[Modified] Following Business Day Convention Other Agreement. For the avoidance
of doubt, the Other Agreement is the agreement between Xxxxxx Guaranty Trust
Company of New York as Party A, the Trustee as Party B, Westpac as the Credit
Support Provider to Party A and the Manager, dated on or about the date of the
Agreement, on the same material terms as the Agreement.
Replaced Transaction
USD-LIBOR-BBA
3. Terms defined in this Confirmation:
Agreement
Trustee
"Determination Time" means 5.00 pm Sydney time 4 Sydney Business Days prior to
the relevant Payment Date or other applicable exchange date.
Westpac
Credit Support Provider Provisions
Each Transaction under this Confirmation shall be capable of being specified as
a Replaced Transaction in accordance with the provisions of Section 21 of the
Agreement. Those provisions shall apply as further specified below.
WESTPAC BANKING CORPORATION
1. Definitions for Credit Events
"Calculation Agent" means the Credit Support Provider or such other party
designated as such for the Transaction. The Calculation Agent's calculations and
determinations shall be made in good faith, in a commercially reasonable manner
and be binding in the absence of manifest error;
"Initial Price" means, with respect to any Reference Obligation, the percentage
listed with respect thereto in the definition of Reference Obligation herein as
the Initial Price;
"Interest Rate Adjustment Amount" means, with respect to any Reference
Obligation, the difference between (i) the Xxxx to Market Value and (ii) 100%
minus the Initial Price;
"Xxxx to Market Rate" means the Xxxx to Market Rate specified in respect of the
Reference Obligation;
"Xxxx to Market Value" means, in the determination of the Calculation Agent,
with respect to any Reference Obligation, on any day, the xxxx to market value
payable on that day (expressed as a percentage of the notional amount thereof),
of a hypothetical interest rate swap commencing on the Effective Date between a
hypothetical party ("Party X") and a counterparty with the highest long term
senior debt rating of each Rating Agency, which swap has a notional amount equal
to US$100,000,000 and under which Party X (i) receives the Xxxx to Market Rate
plus the Initial Spread and (ii) pays a fixed interest amount equal in amount
and timing to the coupons on the Reference Obligation (except a notional amount
of $100,000,000 shall be applied). If, under such swap, Party X would be due to
pay such xxxx to market value, Xxxx to Market Value will be negative and, if
Party X would be due to receive such xxxx to market value, the Xxxx to Market
Value will be positive.
"Market Value" means, in accordance with the Quotation Method, the percentage
equal to the arithmetic mean of quotations (exclusive of accrued but unpaid
interest and expressed as a percentage) obtained from Dealers with respect to a
Valuation Date in the manner provided below. In obtaining such price quotations
from Dealers, the Calculation Agent will request each Dealer to provide firm bid
and offer quotations for an aggregate amount of the Reference Obligation equal
to the Quotation Amount to the extent reasonably practicable as of the Valuation
Time on such Valuation Date. If more than three quotations are provided on such
date, the Market Value shall be the arithmetic mean of such quotations without
regard to the quotations having the highest and lowest values. If exactly three
quotations are provided, the Market Value shall 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 exactly two quotations are provided, the
Market Value shall be the
WESTPAC BANKING CORPORATION
arithmetic mean of such quotations. If fewer than two quotations are provided,
then the Market Value shall be an amount as determined by the Calculation Agent
on the next Business Day on which at least two quotations are provided by
Dealers. If the Calculation Agent is unable to calculate the Market Value prior
to the fifth Business Day following the applicable Valuation Date, then the
Calculation Agent shall determine the Market Value for such Valuation Date in
its reasonable discretion;
"Price Decline Requirement" means the product of 1.5% and the modified duration
of the Reference Obligation at the time of calculation;
"Quotation Method":
Mid-market means that only the arithmetic mean of the bid and offer quotations
provided by Dealers that have provided both bid and offer quotations shall be
used in the calculation of Market Value;
"Reference Obligation" means the obligation(s) as follows:
Issuer/Borrower: Westpac Banking Corporation
Maturity: [Specify]
Coupon: X[OBJECT OMITTED]%
CUSIP/ISIN: CUSIP TT XX/ ISIN XS XX
Original Issue Amount: USDXX
Initial Price: X%
Initial Spread: X[OBJECT OMITTED]% U.S.Treasury Notes due XX/XX/XXXX plus X%;
Xxxx to Market Rate Yield to maturity of X[OBJECT OMITTED]% U.S.Treasury
Notes due
XX/XX/XXXX
Changes with respect to any Reference Obligation. In the event that the
aggregate outstanding principal amount of any Reference Obligation has, in the
opinion of the Calculation Agent, been materially reduced by redemption or
otherwise (other than due to any regularly scheduled amortization or
prepayments), then the Calculation Agent, after consultation with the parties,
shall identify a substitute obligation which ranks equal in priority of payment
with such Reference Obligation and is issued or guaranteed (as to both principal
and interest) by the same issuer and/or guarantor to replace the Reference
Obligation. Upon notice to the parties of a substitute obligation having been
identified by the Calculation Agent, such substitute obligation shall without
further action replace the Reference Obligation.
"Specified Indebtedness" means any obligation (whether present or future,
contingent or otherwise, as principal or surety or otherwise) in respect of
money
WESTPAC BANKING CORPORATION
borrowed or raised or under any finance lease, redeemable preference share,
letter of credit, futures contract, guarantee, indemnity or a transaction of a
type described in the last 6 lines of the definition of Specified Transaction.
"Threshold Amount" means US$50,000,000
"Valuation Time" means 10.00am London Time
2. The parties acknowledge that on the Effective Date of the Substitute
Transaction or the Equivalent Transaction, Party A shall pay to the Credit
Support Provider (in the case of the Substitute Transaction) or to the new
Currency Swap Provider (in the case of the Equivalent Transaction) the amount
equal to the amount (if a positive number) that hypothetically would have been
payable by Party A to Party B under Section 6(e)(i)(3) if:
(a) the Transaction had been terminated;
(b) an Early Termination Date had occurred on the Effective Date; and
(c) Section 21 had not applied in respect of the Transaction.
Any such amount shall be payable by Party A to, as the case may be, either the
Credit Support Provider in accordance with the provisions of the side agreement
between them dated on or about the Trade Date of this Transaction (in the case
of the Substitute Transaction), or the New Currency Swap Provider in accordance
with the relevant Master Agreement between Party A and the New Currency Swap
Provider (in the case of the Equivalent Transaction).
WESTPAC BANKING CORPORATION
ACCESSION BY NEW CURRENCY SWAP PROVIDER
As specified in the Substitution Notice given by Westpac under the Other
Agreement, we agree to be the Credit Support Provider in relation to Westpac as
governed by the terms of the Agreement, in respect of the Transaction specified
by this Annexure 3, and we agree that all references in the Agreement and this
Transaction to "Credit Support Provider" shall be to us, and for consideration
which we acknowledge as having been received, we hereby agree to assume all the
rights and obligations as Credit Support Provider as and from the Effective Date
of this Transaction. The Agreement is attached as annexure A to this Accession
and the confirmation for the Transaction is attached as annexure B to this
Accession.
Agreed and accepted as the new
Credit Support Provider:
By:
Name:
Title:
Agreed and confirmed as of the Effective Date of the Transaction specified in
this Annexure 3:
WESTPAC SECURITIES ADMINISTRATION LIMITED(ACN 000 049 472)
in its capacity as Party B
By:
-----------------------------
Name:
Title:
WESTPAC SECURITISATION MANAGEMENT PTY LIMITED (ACN 000 000 000)
in its capacity as Trust Manager
By:
-----------------------------
Name:
Title:
WESTPAC BANKING CORPORATION
in its capacity as Party A
By:
-----------------------------
Name:
Title:
