EXHIBIT NO. 10.153
ISDA
International Swap Dealers Association, Inc.
MASTER AGREEMENT
Dated as of December 12, 1997
Bhote Koshi Power Company Private Limited and International
Finance Corporation 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 of any such amount will be
automatically satisfied and discharged and, if the aggregate
amount that would otherwise have been payable by one party
exceeds the aggregate amount that would otherwise have been
payable by the other party, replaced by an obligation upon the
party by whom the larger aggregate amount would have been payable
to pay to the other party the excess of the larger aggregate
amount over the smaller aggregate amount.
The parties may elect in respect of two or more Transactions that
a net amount will be determined in respect of all amounts payable
on the same date in the same currency in respect of such
Transactions, regardless of whether such amounts are payable in
respect of the same Transaction. The election may be made in the
Schedule or a Confirmation by specifying that subparagraph (ii)
above will not apply to the Transactions identified as being
subject to the election, together with the starting date (in
which case subparagraph (ii) above will not, or will cease to,
apply to such Transactions from such date). This election may be
made separately for different groups of Transactions and will
apply separately to each pairing of Offices through which the
parties make and receive payments or deliveries.
(d) Deduction or Withholding for Tax.
(i) Gross-Up. All payments under this Agreement will be
made without any deduction or withholding for or on account
of any Tax unless such deduction or withholding is required
by any applicable law, as modified by the practice of any
relevant governmental revenue authority, then in effect. If
a party is so required to deduct or withhold, then that
party ("X") will:
(1) promptly notify the other party ("Y") of such
requirement;
(2) pay to the relevant authorities the full amount
required to be deducted or withheld (including the full
amount required to be deducted or withheld from any
additional amount paid by X to Y under this Section
2(d)) promptly upon the earlier of determining that
such deduction or withholding is required or receiving
notice that such amount has been assessed against Y;
(3) promptly forward to Y an official receipt (or a
certified copy), or other documentation reasonably
acceptable to Y, evidencing such payment to such
authorities; and
(4) if such Tax is an Indemnifiable Tax, pay to Y, in
addition to the payment to which Y is otherwise
entitled under this Agreement, such additional amount
as is necessary to ensure that the net amount actually
received by Y (free and clear of Indemnifiable Taxes,
whether assessed against X or Y) will equal the full
amount Y would have received had no such deduction or
withholding been required. However, X will not be
required to pay any additional amount to Y to the
extent that it would not be required to be paid but
for:
(A) the failure by Y to comply with or perform
any agreement contained in Section 4(a)(i),
4(a)(iii) or 4(d); or
(B) the failure of a representation made by Y
pursuant to Section 3(f) to be accurate and true
unless such failure would not have occurred but
for (I) any action taken by a taxing authority, or
brought in a court of competent jurisdiction, on
or after the date on which a Transaction is
entered into (regardless of whether such action is
taken or brought with respect to a party to this
Agreement) or (II) a Change in Tax Law.
(ii) Liability. If:
(1) X is required by any applicable law, as modified
by the practice of any relevant governmental revenue
authority, to make any deduction or withholding in
respect of which X would not be required to pay an
additional amount to Y under Section 2(d)(i)(4);
(2) X does not so deduct or withhold; and
(3) a liability resulting from such Tax is assessed
directly against X.
then, except to the extent Y has satisfied or then satisfies
the liability resulting from such Tax, Y will promptly pay
to X the amount of such liability (including any related
liability for interest, but including any related liability
for penalties only if Y has failed to comply with or perform
any agreement contained in Section 4(a)(i), 4(a)(iii) or
4(d)).
(e) Default Interest; Other Amounts. Prior to the occurrence or
effective designation of an Early Termination Date in respect of
the relevant Transaction, a party that defaults in the
performance of any payment obligation will, to the extent
permitted by law and subject to Section 6(c), be required to pay
interest (before as well as after judgment) on the overdue amount
to the other party on demand in the same currency as such overdue
amount, for the period from (and including) the original due date
for payments 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 delivery 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 any obligations it has under any Credit
Support Document to which it is a party and has taken all
necessary action to authorise such execution, delivery and
performance;
(iii) No Violation or Conflict. Such execution,
delivery and performance do not violate or conflict with any
law applicable to it, any provision of its constitutional
documents, any order or judgment of any court or other
agency of government applicable to it or any of its assets
or any contractual restriction binding on or affecting it or
any of its assets;
(iv) Consents. All governmental and other consents that are
required to have been obtained by it with respect to this
Agreement or any Credit Support Document to which it is a
party have been obtained and are in full force and effect
and all conditions of any such consents have been complied
with; and
(v) Obligations Binding. Its obligations under this
Agreement and any Credit Support Document to which it is a
party constitute its legal, valid and binding obligations,
enforceable in accordance with their respective terms
(subject to applicable bankruptcy, reorganisation,
insolvency, moratorium or similar laws affecting creditors'
rights generally and subject, as to enforceability, to
equitable principles of general application (regardless of
whether enforcement is sought in a proceeding inequity or at
law)).
(b) Absence of Certain Events. No Event of Default or Potential
Event of Default or, to its knowledge, Termination Event with
respect to it has occurred and is continuing and no such event or
circumstance would occur as a result of its entering into or
performing its obligations under this Agreement or any Credit
Support Document to which it is a party.
(c) Absence of Litigation. There is not pending or, to its
knowledge, threatened against it or any of its Affiliates any
action, suit or proceeding at law or in equity or before any
court, tribunal, governmental body, agency or official or any
arbitrator that is likely to affect the legality, validity or
enforceability against it of this Agreement or any Credit Support
Document to which it is a party or its ability to perform its
obligations under this Agreement or such Credit Support Document.
(d) Accuracy of Specified Information. All applicable
information that is furnished in writing by or on behalf of it to
the other party and is identified for the purpose of this Section
3(d) in the Schedule is, as of the date of the information, true,
accurate and complete in every material respect.
(e) Payer Tax Representation. Each representation specified in
the Schedule as being made by it for the purpose of this Section
3(e) is accurate and true.
(f) Payee Tax Representations. Each representation specified in
the Schedule as being made by it for the purpose of this Section
3(f) is accurate and true.
4. Agreements
Each party agrees with the other that, so long as either party
has or may have any obligation under this Agreement or under any
Credit Support Document to which it is a party:
(a) Furnish Specified Information. It will deliver to the other
party or, in certain cases under subparagraph (iii) below, to
such government or taxing authority as the other party reasonably
directs:
(i) any forms, documents or certificates relating to
taxation specified in the Schedule or any Confirmation;
(ii) any other documents specified in the Schedule or any
Confirmation; and
(iii) upon reasonable demand by such other party, any
form or document that may be required or reasonably
requested in writing in order to allow such other party or
its Credit Support Provider to make a payment under this
Agreement or any applicable Credit Support Document without
any deduction or withholding for or on account of any Tax or
with such deduction or withholding at a reduced rate (so
long as the completion, execution or submission of such form
or document would not materially prejudice the legal or
commercial position of the party in receipt of such demand),
with any such form or document to be accurate and completed
in a manner reasonably satisfactory to such other party and
to be executed and to be delivered with any reasonably
required certification,
in each case by the date specified in the Schedule or such
Confirmation or, if none is specified, as soon as reasonably
practicable.
(b) Maintain Authorisations. It will use all reasonable efforts
to maintain in full force and effect all consents of any
governmental or other authority that are required to be obtained
by it with respect to this Agreement or any Credit Support
Document to which it is a party and will use all reasonable
efforts to obtain any that may become necessary in the future.
(c) Comply with Laws. It will comply in all material respects
with all applicable laws and orders to which it may be subject if
failure so to comply would materially impair its ability to
perform its obligations under this Agreement or any Credit
Support Document to which it is a party.
(d) Tax Agreement. It will give notice of any failure of a
representation made by it under Section 3(f) to be accurate and
true promptly upon learning of such failure.
(e) Payment of Stamp Tax. Subject to Section 11, it will pay
any Stamp Tax levied or imposed upon it or in respect of its
execution or performance of this Agreement by a jurisdiction in
which it is incorporated, organised, managed and controlled, or
considered to have its seat, or in which a branch or office
through which it is acting for the purpose of this Agreement is
located ("Stamp Tax Jurisdiction") and will indemnify the other
party against any Stamp Tax levied or imposed upon the other
party or in respect of the other party's execution or performance
of this Agreement by any such Stamp Tax Jurisdiction which is not
also a Stamp Tax Jurisdiction with respect to the other party.
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 thirteenth day
after notice of such failure is given to the party;
(iii) Credit Support Default.
(1) Failure by the party or any Credit Support
Provider of such party to comply with or perform any
agreement or obligation to be complied with or
performed by it in accordance with any Credit Support
Document if such failure is continuing after any
applicable grace period has elapsed;
(2) the expiration or termination of such Credit
Support Document or the failing or ceasing of such
Credit Support Document to be in full force and effect
for the purpose of this Agreement (in either case other
than in accordance with its terms) prior to the
satisfaction of all obligations of such party under
each Transaction to which such Credit Support Document
relates without the written consent of the other party;
or
(3) the party or such Credit Support Provider
disaffirms, disclaims, repudiates or rejects, in whole
or in part, or challenges the validity of, such Credit
Support Document;
(iv) Misrepresentation. A representation (other than a
representation under Section 3(e) or (f)) made or repeated
or deemed to have been made or repeated by the party or any
Credit Support Provider of such party in this Agreement or
any Credit Support Document proves to have been incorrect or
misleading in any material respect when made or repeated or
deemed to have been made or repeated;
(v) Default under Specified Transaction. The party, any
Credit Support Provider of such party or any applicable
Specified Entity of such party (1) defaults under a
Specified Transaction and, after giving effect to any
applicable notice requirement or grace period, there occurs
a liquidation of, an acceleration of obligations under, or
an early termination of, that Specified Transaction, (2)
defaults, after giving effect to any applicable notice
requirement or grace period, in making any payment or
delivery due on the last payment, delivery or exchange date
of, or any payment on early termination of, a Specified
Transaction (or such default continues for at least three
Local Business Days if there is no applicable notice
requirement or grace period) or (3) disaffirms, disclaims,
repudiates or rejects, in whole or in part, a Specified
Transaction (or such action is taken by any person or entity
appointed or empowered to operate it or act on its behalf);
(vi) Cross Default. If "Cross Default" is specified in the
Schedule as applying to the party, the occurrence or
existence of (1) a default, event of default or other
similar condition or event (however described) in respect of
such party, any Credit Support Provider of such party or any
applicable Specified Entity of such party under one or more
agreements or instruments relating to Specified Indebtedness
of any of them (individually or collectively) in an
aggregate amount of not less than the applicable Threshold
Amount (as specified in the Schedule) which has resulted in
such Specified Indebtedness becoming, or becoming capable at
such time of being declared, due and payable under such
agreements or instruments, before it would otherwise have
been due and payable or (2) a default by such party, such
Credit Support Provider or such Specified Entity
(individually or collectively) in making one or more
payments on the due date thereof in an aggregate amount of
not less than the applicable Threshold Amount under such
agreement or instrument (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 judgment
of insolvency or bankruptcy or any other relief under
any bankruptcy or insolvency law or other similar law
affecting creditors' rights, or a petition is presented
for its winding-up or liquidation, and, in the case of
any such proceeding or petition instituted or presented
against it, such proceeding or petition (A) results in
a judgment of insolvency or bankruptcy or the entry of
an order for relief or the making of an order for its
winding-up or liquidation or (B) is not dismissed,
discharged, stayed or restrained in each case within 30
days of the institution or presentation thereof; (5)
has a resolution passed for its winding-up, official
management or liquidation (other than pursuant to a
consolidation, amalgamation or merger); (6) seeks or
becomes subject to the appointment of an administrator,
provisional liquidator, conservator, receiver, trustee,
custodian or other similar official for it or for all
or substantially all of 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 or 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, a Tax Event Upon Merger if the event is specified in
(iii) below, and if specified to be applicable, a Credit Event
Upon Merger if the event is specified pursuant to (iv) below or
an Additional Termination Event if the event is specified
pursuant to (v) below:
(i) Illegality. Due to the adoption of, or any change in,
any applicable law after the date of 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 such
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(1)(viii) but the creditworthiness of the resulting,
surviving or transferee entity is materially weaker than
that of X, such Credit Support Provider or such Specified
Entity, as the case may be, immediately prior to such action
(and, in such event, X or its successor or transferee, as
appropriate, will be the Affected Party); or
(v) Additional Termination Event. If any "Additional
Termination Event" is specified in the Schedule or any
Confirmation as applying, the occurrence of such event (and,
in such event, the Affected party or Affected Parties shall
be as specified for such Additional Termination Event in the
Schedule or such Confirmation).
(c) Event of Default and Illegality. If an event or
circumstance which would otherwise constitute or give rise to an
Event of Default also constitutes an Illegality, it will be
treated as an Illegality and will not constitute an Event of
Default.
6. Early Termination
(a) Right to Terminate Following Event of Default. If at any
time an Event of Default with respect to a party (the "Defaulting
Party") has occurred and is then continuing, the other party (the
"Non-defaulting Party") may, by not more than 20 days notice to
the Defaulting Party specifying the relevant Event of Default,
designate a day not earlier than the day such notice is effective
as an Early Termination Date in respect of all outstanding
Transactions. If, however, "Automatic Early Termination" is
specified in the Schedule as applying to a party, then an Early
Termination Date in respect of all outstanding Transactions will
occur immediately upon the occurrence with respect to such party
of an Event of Default specified in Section 5(a)(vii)(1), (3),
(5), (6) or, to the extent analogous thereto, (8), and as of the
time immediately preceding the institution of the relevant
proceeding or the presentation of the relevant petition upon the
occurrence with respect to such party of an Event of Default
specified in Section 5(a)(vii)(4) or, to the extent analogous
thereto, (8).
(b) Right to Terminate the 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
continuing, designate a day not earlier than the day
such notice is effective as an Early Termination Date
in respect of all Affected Transactions.
(c) Effect of Designation.
(i) If notice designating an Early Termination Date is
given under Section 6(a) or (b), the Early Termination Date
will occur on the date so designated, whether or not the
relevant Event of Default or Termination Event is then
continuing
(ii) Upon the occurrence or effective designation of an
Early Termination Date, no further payments or deliveries
under Section 2(a)(i) or 2(e) in respect of the Terminated
Transactions will be required to be made, but without
prejudice to the other provisions of this Agreement. The
amount, if any, payable in respect of an Early Termination
Date shall be determined pursuant to Section 6(e).
(d) Calculations.
(i) Statement. On or as soon as reasonably practicable
following the occurrence of an Early Termination Date, each
party will make the calculations on its part, if any,
contemplated by Section 6(e) and will provide to the other
party a statement (1) showing, in reasonable detail, such
calculations (including all relevant quotations and
specifying any amount payable to its to be paid. In the
balance 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 judgement) 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 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 to of this Agreement. If that amount is
a positive number, the Defaulting Party will pay it to the Non-
defaulting Party; if it is a negative number, the Non-defaulting
Party will pay the absolute value of that amount to the
Defaulting Party.
(ii) Termination Events, If the Early Termination Date
results from a Termination Event:
(1) One Affected Party. If there is one Affected Party, the
amount payable will be determined in accordance with Section
6(e)(i)(3), if Market Quotation applies, or Section 6(e)(i)(4),
if Loss applies, except that, in either case, references to the
Defaulting Party and to the Non-defaulting Party will be deemed
to be references to the Affected Party and the party which is not
the Affected Party, respectively, and, if Loss applies and fewer
than all the Transactions are being terminated, Loss shall be
calculated in respect of all Terminated Transactions.
(2) Two Affected Parties. If there are two Affected Parties:
(A) if Market Quotation applies, each party will
determine a Settlement Amount in respect of the
Terminated Transactions. and an amount will be
payable equal to (I) the sum of (a) one-behalf 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 payments or
deliveries made by one party to the other under this Agreement
(and retained by such other party) during the period from the
relevant Early Termination Date to the date for payment
determined under Section 6(d)(ii).
(iv) Pre-Estimate. The parties agree that if Market
Quotation applies an amount recoverable under this Section
6(e) is a reasonable pre-estimate of loss and not a penalty.
Such amount is payable for the loss of bargain and the loss
of protection against future risks and except as otherwise
provided in this Agreement neither party will be entitled to
recover any additional damages as a consequence of such
losses.
7. Transfer
Subject to Section 6(b)(ii), neither this Agreement nor any
interest or obligation in or under this Agreement may be
transferred (whether by way of security or otherwise) by either
party without the prior written consent of the other party,
except that:
(a) a party may make such a transfer of this Agreement pursuant
to a consolidation or amalgamation with, or merger with or into,
or transfer of all or substantially all its assets to, another
entity (but without prejudice to any other right or remedy under
this Agreement); and
(b) a party may make such a transfer of all or any part of its
interest in any amount payable to it from a Defaulting Party
under Section 6(e).
Any purported transfer that is not in compliance with this
Section will be void.
8. Contractual Currency
(a) Payment in the Contractual Currency. Each payment under
this Agreement will be made in the relevant currency specified in
this Agreement for that payment (the "Contractual Currency"). To
the extent permitted by applicable law, any obligation to make
payments under this Agreement in the Contractual Currency will
not be discharged or satisfied by any tender in any currency
other than the Contractual Currency, except to the extent such
tender results in the actual receipt by the party to which
payment is owed, acting in a reasonable manner and in good faith
in converting the currency so tendered into the Contractual
Currency, of the full amount in the Contractual Currency of all
amounts payable in respect of this Agreement. If for any reason
the amount in the Contractual Currency so received falls short of
the amount in the Contractual Currency payable in respect of this
Agreement, the party required to make the payment will, to the
extent permitted by applicable law, immediately pay such
additional amount in the Contractual Currency as may be necessary
to compensate for the shortfall. If for any reason the amount in
the Contractual Currency so received exceeds the amount in the
Contractual Currency payable in respect of this Agreement, the
party receiving the payment will refund promptly the amount of
such excess.
(b) Judgements. 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 judgement 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 judgement 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 owned and will not be affected by judgment
being obtained or claim or proof being made for any other sums
payable in respect of this Agreement.
(d) Evidence of Loss. For the purpose of this Section 8, it
will be sufficient for a party to demonstrate that it would have
suffered a loss had an actual exchange or purchase been made.
9. Miscellaneous
(a) Entire Agreement. This Agreement constitutes the entire
agreement and understanding of the parties with respect to its
subject matter and supersedes all oral communication and prior
writings with respect thereto.
(b) Amendments. No amendment, modification or waiver in respect
of this Agreement will be effective unless in writing (including
a writing evidenced by a facsimile transmission) and executed by
each of the parties or confirmed by an exchange of telexes or
electronic messages on an electronic messaging system.
(c) Survival of Obligations. Without prejudice to Sections
2(a)(iii) and 6(c)(ii), the obligations of the parties under this
Agreement will survive the termination of any Transaction.
(d) Remedies Cumulative. Except as provided in this Agreement,
the rights, powers, remedies and privileges provided in this
Agreement are cumulative and not exclusive of any rights, powers,
remedies and privileges provided by law.
(e) Counterparts and Confirmations.
(i) This Agreement (and each amendment, modification and
waiver in respect of it) may be executed and delivered in
counterparts (including by facsimile transmission), each of
which will be deemed an original.
(ii) The parties intend that they are legally bound by the
terms of each Transaction from the moment they agree to
those terms (whether orally or otherwise). A Confirmation
shall be entered into as soon as practicable and may be
executed and delivered in counterparts (including by
facsimile transmission) or be created by an exchange of
telexes or by an exchange of electronic 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 organization of such party, the obligations of
such party are the same as if it had entered into the Transaction
through its head or home office. This representation will be
deemed to be repeated by such party on each date on which a
Transaction is entered into.
(b) Neither party may change the Office through which it makes
and receives payments or deliveries for the purpose of a
Transaction without the prior written consent of the other party,
(c) If a party is specified as a Multibranch Party in the
Schedule, such Multibranch Party may make and receive payments or
deliveries under any Transaction through any Office listed in the
Schedule, and the Office through which it makes and receives
payments or deliveries with respect to a Transaction will be
specified in the relevant Confirmation.
11. Expenses
A Defaulting Party will, on demand, indemnify and hold harmless
the other party for and against all reasonable out-of-pocket
expenses, including legal fees and Stamp Tax, incurred by such
other party by reason of the enforcement and protection of its
rights under this Agreement or any Credit Support Document to
which the Defaulting Party is a party or by reason of the early
termination of any Transaction, including but not limited to,
costs of collection.
12. Notices
(a) Effectiveness. Any notice or other communication in respect
of this Agreement may be given in any manner set forth below
(except that a notice or other communication under Section 5 or 6
may not be given by facsimile transmission or electronic
messaging system) to the address or number or in accordance with
the electronic messaging system details provided (see the
Schedule) and will be deemed effective as indicated:
(i) if in writing and delivered in person or by courier, on
the date it is delivered;
(ii) if sent by telex, on the date the recipient's answer
back 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 transmission report generated by the sender's
facsimile machine);
(iv) if sent by certified or registered mail (airmail, if
overseas) or the equivalent (return receipt requested), on
the date that mail is delivered or its delivery is
attempted; or
(v) if sent by electronic messaging system, on the date
that electronic message is received, unless the date of that
delivery (or attempted delivery) or that receipt, as
applicable, is not a Local Business Day or that
communication is delivered (or attempted) or received, as
applicable, after the close of business on a Local Business
Day, in which case that communication shall be deemed given
and effective on the first following day that is a Local
Business Day.
(b) Change of Addresses. Either party may by notice to the
other change the address, telex or facsimile number or
electronic messaging system details at which notices or
other communications are to be given to it.
13. Governing Law and Jurisdiction
(a) Governing Law. This Agreement will be governed by and
construed in accordance with the law specified in the Schedule.
(b) Jurisdiction. With respect to any suit, action or
proceedings relating to this Agreement ("Proceedings"), each
party irrevocably:
(i) submits to the jurisdiction of the English courts, if
this Agreement is expressed to be governed by English law,
or to the non-exclusive jurisdiction of the courts of the
State of New York and the United States District Court
located in the Borough of Manhattan in New York City, if
this Agreement is expressed to be governed by the laws of
the State of New York; and
(ii) waives any objection which it may have at any time to
the laying of venue of any Proceedings brought in any such
court, waives any claim that such Proceedings have been
brought in an inconvenient forum and further waives the
right to object, with respect to such Proceedings, that such
court does not have any jurisdiction over such party.
Nothing in this Agreement precludes either party from bringing
Proceedings in any other jurisdiction (outside, if this Agreement
is expressed to be governed by English law, the Contracting
States, as defined in Section 1(3) of the Civil Jurisdiction and
Judgements Xxx 0000 or any modification, extension or re-
enactment thereof for the time being in force) nor will the
bringing of Proceedings in any one or more jurisdictions preclude
the bringing of Proceedings in any other jurisdiction.
(c) Service of Process. Each party irrevocably appoints the
Process Agent (if any) specified opposite its name in the
Schedule to receive, for it and on its behalf, service of process
in any Proceedings. If for any reason any party's Process Agent
is unable to act as such, such party will promptly notify the
other party and within 30 days appoint a substitute process agent
acceptable to the other party. The parties irrevocably consent
to service of process given in the manner provided for notices in
Section 12. Nothing in this Agreement will affect the right of
either party to serve process in any other manner permitted by
law.
(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)(iii) 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, authorization,
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.
"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 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
payments, (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 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 been required after that
date. For this purpose. Unpaid Amounts in respect of the
Terminated Transaction or group of Terminated Transactions are to
be excluded but, without limitation, any payment or delivery that
would, but for the relevant Early Termination Date, have been
required (assuming satisfaction of each applicable condition
precedent) after that Early Termination Date is to be included.
The Replacement Transaction would be subject to such
documentation as such 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 as 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, 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.
"Set-off" means set-off, offset, combination of accounts, rights
or retention or withholding or similar right or requirement to
which the payer of an amount under Section 6 is entitled or
subject (whether arising under this Agreement, another contract,
applicable law or otherwise) that is exercised by, or imposed on,
such payer.
"Settlement Amount" means, with respect to a party and any Early
Termination Date, the sum of:
(a) the Termination Currency Equivalent of the Market Quotations
(whether positive or negative) for each Terminated Transaction or
group of Terminated Transactions for which a Market Quotation is
determined; and
(b) such party's Loss (whether positive or negative and without
reference to any Unpaid Amounts) for each Terminated Transaction
or group of Terminated Transactions for which a Market Quotation
cannot be determined or would not (in the reasonable belief of
the party making the determination) produce a commercially
reasonable result.
"Specified Entity" has the meaning specified in the Schedule.
"Specified Indebtedness" means, subject tot he 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, of 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 become 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 Termination Transaction, for each
obligation under Section 2(a)(i) which was (or would have been
but for Section 2(a)(iii) required to be settled by delivery to
such party on or prior to such Early Termination Date and which
has not been so settled as at such Early Termination Date, an
amount equal to the fair market value of that which was (or would
have been) required to be delivered as of the originally
scheduled date for delivery, in each case together with (to the
extent permitted under applicable law) interest, in the currency
of such amounts, from (and including) the date such amounts or
obligations were or would have been required to have been paid or
performed to (but excluding) such Early Termination Date, at the
Applicable Rate. Such amounts of interest will be calculated on
the basis of daily compounding and the actual number of days
elapsed. The fair market value of any obligation referred to in
clause(b) above shall be reasonably determined by the party
obliged to make the determination under Section 6(e) or, if each
party is so obliged, it shall be the average of the termination
Currency Equivalents of the fair market values reasonably
determined by both parties.
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.
Bhote Koshi Power Company International Finance Corporation
Private Limited
By: /s/ Xxxxxxx X. Xxxxxxxx By: /s/ X. Xxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxx Name: Xxxxx Xxxxxxxxx
Date December 12, 1997 Date: December 12, 1997
