Exhibit 10.24
The definitions and provisions contained in the 2000 ISDA Definitions (as published by the International Swaps and Derivatives Association, Inc.), without regard to any amendment or supplement thereof subsequent to the date of this Agreement (the “ISDA Definitions”). A Guide To ISDA's 2006 Definitions. Request a PDF. Allows for convenience of reference while retaining the flexible structure of the 2000 Definitions, since ISDA contemplates that it. 2006 ISDA DEFINITIONS The 2006 ISDA Definitions (the “2006 Definitions”) are intended for use in confirmations of individual transactions (“Confirmations”) governed by agreements such as the 1992 ISDA Master Agreements and the 2002 ISDA Master Agreement (the “ISDA.
(Multicurrency-Cross Border)
Definitions, whether or not supplemented by the 2000 Supplement, or the 1997 ISDA Bullion Definitions, will not, without further action by the parties, be affected by the use of these Commodity Definitions for transactions. ISDA has provided these Commodity Definitions to. An ISDA Master Agreement is the standard document that is regularly used to govern over-the-counter derivatives transactions. The Agreement, which is published by the International Swaps.
ISDA®
MASTER AGREEMENT
ISDA Protocol 4 The Protocol will enable firms to apply the 2014 Definitions to certain existing transactions, eliminating distinctions between legacy transactions and new transactions under the 2014 Definitions. The 2006 ISDA Definitions (the “2006 Definitions”) are intended for use in confirmations of individual transactions governed by ISDA Master Agreements. The 2006 Definitions are an update of the 2000 ISDA Definitions (the “2000 Definitions”) which many parties to privately negotiated derivative transactions have incorporated into.
Dated as of , 2007| GMAC MORTGAGE, LLC | GMAC BANK |
and
| (referred to herein as “Party A”) | (referred to herein as “Party B”) |
have entered and/or anticipate entering into one or more transactions (each a “Transaction”) that are orwill 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 thepurpose of this Master Agreement.
(b) Inconsistency. In the event of any inconsistency between the provisions of the Schedule and the otherprovisions 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 therelevant Transaction.
(c) Single Agreement. All Transactions are entered into in reliance on the fact that this Master Agreement and allConfirmations form a single agreement between the parties (collectively referred to as this “Agreement”), and the parties would not otherwise enter into any Transactions.
(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 thisAgreement, 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 mannercustomary 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 theother 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 precedentspecified in this Agreement. |
Copyright © 1992 by International Swap Dealers Association, Inc.
(b) Change of Account. Either party may change its account for receiving a payment or delivery by giving notice to theother 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, onsuch 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 wouldotherwise 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 aggregateamount.
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 samedate 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) abovewill 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 bemade 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.
(i) Gross-Up. All payments under this Agreement will bemade 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 isso required to deduct or withhold, then that party (“X”) will:—
(1) promptly notify the other party (“Y”) of suchrequirement;
(2) pay to the relevant authorities the full amount required to the deducted or withheld (including the full amount requiredto 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 againstY;
(3) promptly forward to Y an official receipt (or a certified copy), or other documentation reasonable acceptable to Y, evidencing suchpayment to such authorities; and
(4) if such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment to which Y is otherwiseentitled 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 hadno 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 thisAgreement) or (II) a Change in Tax Law.| 2 | ISDA® 1992 |
(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 withholdingin 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 orwithhold; 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 anyrelated 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 ondemand 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 dailycompounding 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 settledby 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 dateon 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 thejurisdiction of its organisation or incorporation and, if relevant under such laws, in good standing;
(ii) Powers. It has thepower 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 toperform 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, anyprovision 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 anyCredit 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| 3 | ISDA® 1992 |
(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 aparty.
(c) Absence of Litigation. There is not pending or, to its knowledge, threatened against it or any of its Affiliates any action, suitor 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 towhich it is a party or its ability to perform its obligations under this Agreement or such Credit Support Document.
(d) Accuracy of SpecifiedInformation. 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, accurateand complete in every material respect.
(e) Payer Tax Representation. Each representation specified in the Schedule as being made by it forthe purpose of this Section 3(e) is accurate and true.
(f) Payee Tax Representations. Each representation specified in the Schedule as being made byit for the purpose of this Section 3(f) is accurate and true.
4. Agreements
(i) any forms, documents or certificates relating to taxation specified inthe 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 suchother 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 (solong 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 mannerreasonably satisfactory to such other party and to be executed and to be delivered with any reasonably required certification,in each case by the datespecified in the Schedule or such Confirmation or, if none is specified, as soon as reasonably practicable.
(b) Maintain Authorisations. Itwill 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 andwill use all reasonable efforts to obtain any that may become necessary in the future.
(c) Comply with Laws. It will comply in all materialrespects 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 learningof 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 ofits 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 isacting 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 performanceof 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 Defaultand Termination Events
(a) Events of Default. The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of suchparty 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;(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 orperformed 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 itsterms) 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, suchCredit Support Document;(iv) Misrepresentation. A representation (other than a representation under Section 3(e) or (f)) made orrepeated 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 ordeemed to have been made or repeated;
(v) Default under Specified Transaction. The party, any Credit Support Provider of such party or anyapplicable 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 earlytermination 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 earlytermination 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, aSpecified 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 applicableSpecified 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 theSchedule) 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 defaultby 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 agreementsor instruments (after giving effect to any applicable notice requirement or grace period);
(vii) Bankruptcy. The party, any Credit SupportProvider 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 forthe 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 orthe 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 aresolution 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 orother 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 daysthereafter; (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 anyaction in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts; or
(viii) MergerWithout Assumption. The party or any Credit Support Provider of such party consolidates of 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 partyor 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 suchresulting, surviving or transferee entity of its obligations under this Agreement.
(b) Termination Events. The occurrence at any time with respect to aparty or, if applicable, any Credit Support Provider of such party or any Specified Entity of such party of any event specified below constitutes an Illegality if the event is specified in (i) below, a Tax Event if the event is specified in(ii) below or a Tax Event Upon Merger if the event is specified in (iii) below, and, if specified to be applicable, a Credit Event Upon Merger if the event is specified pursuant to (iv) below or an Additional Termination Event if theevent is specified pursuant to (v) below:—
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(i) Illegality. Due to the adoption of, or any change in, any applicable law after the date onwhich a Transaction is entered into, or due to the promulgation of, or any change in, the interpretation by any court, tribunal or regulation authority with competent jurisdiction of any applicable law after such date, it becomes unlawful (otherthan 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 anyabsolute 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 SupportProvider) has under any Credit Support Document relating to such Transaction;(ii) Tax Event. Due to (x) any action taken by ataxing 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 inTax 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 anIndemnifiable 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 inrespect 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) berequired 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 orwithheld 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 oramalgamating 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 notconstitute 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 asspecified for such Additional Termination Event in the Schedule or such Confirmation).
(c) Event of Default and Illegality. If an event orcircumstance 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, be 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 ofan 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 petitionupon 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 becomingaware 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 AffectedParty, 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 willnot 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 AffectedTransactions to another of its Offices or Affiliates so that such Termination Event ceases to exist.If the Affected Party is not able tomake 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, whichconsent 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 useall 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.(1) a transfer under Section 6(b)(ii) or an agreement underSection 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 occursand 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 EventUpon 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 AdditionalTermination 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 asan Early Termination Date in respect of all Affected Transactions.
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(c) Effect of Designation.
(ii) Upon the occurrence or effective designation of an Early Termination Date, no further payments or deliveriesunder Section 2(a)(i) or 2(c) 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 bedetermined pursuant to Section 6(e).
(d) Calculations.
(ii) Payment Date. An amount calculated as being due in respect of any Early Termination Dateunder 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 BusinessDays 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 applicablelaw) 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 calculatedon the basis of daily compounding and the actual number of days elapsed.
(e) Payments on Early Termination. If an Early Termination Date occurs, thefollowing provisions shall apply based on the parties’ election in the Schedule of a payment measure, either “Market Quotation” or “Less”, and a payment method, either the “First Method” or the “SecondMethod”. 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. That amount, if any, payablein respect of an Early Termination Date and determined pursuant to this Section will be subject to any Set-off.
(i) Events of Default. Ifthe Early Termination Date results from an Event of Default:—
(1) First Method and Market Quotation. If the First Method and MarketQuotation 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 theTermination 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, theNon-defaulting Party’s Loss in respect of this Agreement.(3) Second Method and Market Quotation. If the Second Method and MarketQuotation apply, an amount will be payable equal to (A) the sum of the Settlement Amount (determined by the
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Non-defaulting Party) in respect of the Terminated Transactions and the Termination Currency Equivalentof 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 theNon-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 payit 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.
(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 beingterminated, Loss shall be calculated in respect of all Terminated Transactions.
(2) Two Affected Parties. If there are two AffectedParties:-
(A) if Market Quotation applies, each party will determine a Settlement Amount in respect of the Terminated Transactions, and anamount 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 SettlementAmount (“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, inrespect 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 of Bankruptcy. In circumstances where an Early Termination Date occurs because “Automatic EarlyTermination” applies 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 underthis 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 reasonablepre-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 addition damagesas a consequence of such losses.| 10 | ISDA® 1992 |
| 7. | Transfer |
Subject to Section 6(b)(ii), neither this Agreement norany 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 allits 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 allor 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 withthis Section will be void.
| 8. | Contractual Currency |
(a) Payment in the ContractualCurrency. 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 paymentsunder 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 isowed, 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 theamount 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 suchadditional 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 thisAgreement, the party receiving the payment will refund promptly the amount of such excess.
(b) Judgments. To the extent permitted byapplicable 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 earlytermination in respect of this Agreement or (iii) in respect of a judgment or order of another court of the payment of any amount described in (i) or (ii) above, the party seeking recovery, after recovery in full of the aggregate amount of whichsuch 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 othercurrency 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 therate 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 goodfaith 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 ofaction, 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 anactual exchange or purchase been made.
| 11 | ISDA® 1992 |
| 9. | Miscellaneous |
(a) Entire Agreement. This Agreementconstitutes 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.
(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 bylaw.
(e) Counterparts and Confirmations.
(ii) The parties intend that they are legally bound by the terms of each Transaction from the moment they agree to those terms (whetherorally 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 electronicmessages 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 orprivilege 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 orprivilege or the exercise of any other right, power or privilege.
(g) Headings. The headings used in this Agreement are for convenience ofreference 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 inthe 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 organisationof 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 priorwritten consent of the other party.
(c) If a party is specified as a Multibranch Party in the Schedule, such Multibranch Party may make and receivepayments 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 holdharmless 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 SupportDocument
| 12 | ISDA® 1992 |
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 othercommunication 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 ornumber 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 therecipient’s answerback is received;
(iii) if sent by facsimile transmission, on the date that transmission is received by aresponsible employee of the recipient in legible form (if 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 orits 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) orreceived, 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 atwhich 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 anysuit, action or proceedings relating to this Agreement (“Proceedings”), each party irrevocably —
(i) submits to thejurisdiction 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 inNew 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 itmay 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 otherjurisdiction [illegible] if this Agreement is expressed to be governed by English law, the Contracting States, as defined in Section I(3) of the Civil Jurisdiction and Judgments Act 1982 or any modification, extension or re-enactment thereoffor the time being in force) nor will be 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 | ISDA® 1992 |
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 agentprocess 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 mannerpermitted by law.
(d) Waiver of Immunities. Each party irrevocably waives, to the fullest extent permitted by applicable law, with respect toitself 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 specificperformance 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 thecourts 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).“Affiliate” means, subject to the Schedule, in relation to any person, any entity controlled, directly or indirectly, by the person, any entity controls, directly or indirectly, the person or any entitydirectly 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 of the entity or person.
“Applicable Rate” means:(a) inrespect 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 respectof 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 theenactment, promulgation, execution or ratification of, 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.ISDA® 1992
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 at the government or taxationauthority 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 suchjurisdiction, 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 arisingsolely 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).
“Local Business Day” means, subject to the Schedule, a dayon 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 sospecified, 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 noticeprovided 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 tosuch Specified Transaction.
“Loss” means, with respect to this Agreement or one or more Terminated Transactions, as the case maybe, 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 negative number) in connection with this Agreement or thatTerminated 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 included losses and costs (or gains) in respect of any payment or delivery required to have been made (assumingsatisfaction 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’slegal 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 reasonablypracticable. A party may (but need not) determine as Loss by reference to quotations of relevant rates or prices from one or more leading dealers in the relevant markets.
15
been required after that date. For this purpose, Unpaid Amounts in respect of the Terminated Transaction or group ofTerminated 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 EarlyTermination Date is to be included. The Replacement Transaction would be subject to such documentation such as party and the Reference Market-maker may, in good faith, agree. The party making the determination (or its agent) will request eachReference Market-makes 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 andtime 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 quotationsare 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 hasthe 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 TerminatedTransactions cannot be determined.
“Non-default Rate” means a rate per annum equal to the cost (without proof or evidence of any actual cost) tothe Non-defaulting Party (as certified by it) if it were to fund the relevant amount.
“Non-defaulting Party” has the meaning specified inSection 6(a).
“Office” means a branch or office of a many, 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 Market Quotation in good faith (a) from amongdealers 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 anoffice 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 Section2(a)(i) with respect to a Transaction.
Set-off” means set-off, offset, combination of accounts, right of retention or withholding or similar right orrequirement to which the payer of an amount under Section 6 is entitled or subject (whet her 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:(b) such party’s Loss (whether positive or negative and without reference to any Unpaid Amounts) for each Terminated Transaction or group ofTerminated Transactions for which a Market Quotation cannot be determined or would not (in the reasonable belief of the party making the determination) product a commercially reasonable result.
“Specified Entity” has the meaning specified in the Schedule.| 16 | ISDA® 1992 |
“Specified Indebtedness” means, subject to the Schedule, any obligation (whether present orfuture, contingent or otherwise, as principal or surely or otherwise) in respect of borrowed money.
“Specified Transaction” means,subject to the Schedule, (a) any transaction (including an agreement with respect the thereto) now existing or hereafter entered into between one party to this Agreement (or any Credit Support Provider of such party of any applicable SpecifiedEntity 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, commodityswap, 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-currencyrate swap transaction, currency option or any other similar transaction, (including any option with respect to any of these transactions) (b) any combination of these transaction and (c) any other transaction identified as a SpecifiedTransaction in this Agreement or the ralevand confirmation.
“Stamp Tax” means any stamp, registration, documentation, or similartax.
“Tax” means any present or future tax, levy, impost, duly, charge, assessment or fee of any nature (including interestpenalties 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) it resulting from a Termination Event, all Affected Transactions and (b) if resulting from an Event of Default, all Transactions (in either case) in affect immediately before theeffectiveness of the notice designating that Early Termination Date (or, if “Automatic Early Termination” applies, immediately before that Early Termination Date)
“Termination CurrencyEquivalent” 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 “OtherCurrency”), 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 Data, or, if the relevant MarketQuotation or Loss (as the case may be). Is determined as of a later data, that later data, 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 suchOther Currency with the Termination Currency at or about 1:00 a.m. ( in the city in which such foreign exchange amount is located) on such date as would be customary for the determination of such a rate for the purchase of such Other Currency forvalue 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 bythe parties.
“Termination Event” means an illegality, a Tax Event or a Tax Event Upon Merger on if specified to be applicable, aCredit Event Upon Merger or an Additional Termination Event.
“Transaction Rate” means a rate per annual equal to the arithmeticmean 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 Data, the aggregate of (a) in respect of all Terminated Transactions, the amounts that became payable (or that would have becamepayable but for Section 2(a)(iii)) to such party under Section 2(a)(i) on or prior to such Early Termination Data and which remain unpaid as at such Early Termination Data and (b) in respect of each Terminated Transaction, for eachobligation under Section 2(a)(i) which was (or would have been but for Sector 2(a)(iii)) required to be settled by delivery in such party on or prior to such Early Termination Date and which has not been so settle as at such Early TerminationDate, an amount equal to the far market
| 17 | ISDA® 1992 |
Value of that which was (or would have been) required to be delivered as of the originally scheduled data 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 (butexcluding) 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 day clasped. 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 valuesreasonably determined by both parties.
IN WITNESS WHEREOF the parties have executed this document on the respective dates specified below with effect fromthe date specified on the first page of this document.
| GMAC MORTGAGE, LLC | GMAC BANK | ||||
| By: | /s/ Sandy Blitzer | By: | /s/ Robert E. Groody | ||
| Name: | Sandy Blitzer | Name: | Robert E. Groody | ||
| Title: | Vice President | Title: | Chief Mortgage Accountant | ||
| Date: | Date: | 06/12/07 | |||
| 18 | ISDA® 1992 |
(Multicurrency - Cross Border)
ISDA 1992 Master Agreement
SCHEDULE
ISDA Master Agreement (FMV)
dated as of August 31, 2007
between
| GMAC Mortgage, LLC, | and | GMAC Bank |
| a Delaware limited liability company | a Utah industrial bank | |
| (referred to herein as “Party A”) | (referred to herein as “Party B”) |
This Agreement shall apply to and govern: (i) with effect on the Commencement Date and continuing until theTermination Date, each Subject Transaction (as defined in Part 6 hereof) without regard to the execution of a Confirmation in respect of such Subject Transaction and (ii) any other Transaction between the parties the terms of which are set outin a Confirmation the provisions of which expressly reference and incorporate by reference the provisions of this Master Agreement.
Part 1. TerminationProvisions.
| (a) | “Specified Entity” means in relation to Party A for the purpose of: |
Section 5(a)(vi): Not Applicable
Section 5(a)(vii): Not Applicable
Section 5(b)(iv): Not Applicableand inrelation to Party B for the purpose of:
Section 5(a)(v): Not Applicable
Section 5(a)(vi): Not ApplicableSection 5(a)(vii): Not Applicable
Section 5(b)(iv): Not Applicable
| (b) | “Specified Transaction” will have the meaning specified in Section 14 of this Agreement. |
| (c) | The “Cross Default” provisions of Section 5(a)(vi): | will not apply to Party A and |
| will not apply to Party B |
| (d) | The “Credit Event Upon Merger” provisions of Section 5(b)(iv): | will not apply to Party A and |
| will not apply to Party B. | ||
| (e) | The “Automatic Early Termination” provision of Section 6(a): | will not apply to Party A and |
| will not apply to Party B. |
| (f) | Payments on Early Termination. For the purpose of Section 6(e) of this Agreement and subject to the provisions of Part 5 of this Schedule: |
| (i) | Market Quotation will apply. |
| (ii) | The Second Method will apply. |
| (g) | “Termination Currency” means United States Dollars. |
| (h) | “Additional Termination Event” shall mean termination of that certain ISDA Master Agreement (Net Funding), dated as of August 31, 2007. |
Part 2. Tax Representations.
| (a) | Payer Representations. For the purpose of Section 3(e) of this Agreement, Party A and Party B each make the following representation: |
| (b) | Payee Representations. |
| (1) | For the purpose of Section 3(f) of this Agreement, Party A represents that it is a limited liability company organized and existing under the laws of the State of Delaware. |
| (2) | For the purpose of Section 3(f) of this Agreement, Party B represents that it is an industrial bank organized and existing under the laws of the State of Utah. |
Part 3. Agreement to Deliver Documents.
For the purpose of Sections 4(a)(i) and (ii) of this Agreement, respectively, each party agrees to deliver (i) such tax forms, certificates and other documents as the other party may reasonably request and (ii) such documentsas the other party may reasonably request to evidence the power and authority of such party to enter into this Agreement and the Transactions hereunder and the incumbency of the individuals executing this Agreement and each Confirmation on itsbehalf.
Part 4. Miscellaneous.
| (a) | Address for Notices. Section 12(a) is hereby amended to delete the phrase “facsimile transmission or” from the third line thereof. For thepurpose of Section 12(a) of this Agreement: |
| (i) | Address for notices or communications to Party A: | GMAC Mortgage, LLC |
| 4 Walnut Grove Drive | ||
| Horsham, PA 19044 | ||
| Attention: Chief Financial Officer | ||
| Facsimile No: (215) 682-1151 | ||
| (ii) | Address for notices or communications to Party B: | GMAC Bank |
| 4 Walnut Grove Drive | ||
| Horsham, PA 19044 | ||
| Attention: EVP – Mortgage Operations | ||
| Facsimile No.: (215) 682-1770 | ||
| Telephone No.: (215) 682-3225 |
2
| With a copy to: |
GMAC Bank |
6985 Union Park Center, Suite 435 |
Midvale, UT 84047 |
Attention: Chief Financial Officer |
Facsimile No.: (801) 790-5002 |
Telephone No.: (801) 790-5062 |
| (b) | Process Agent. | With respect to Party A: Not Applicable. |
| With respect to Party B: Not Applicable. |
| (c) | Offices. The provisions of Section 10(a) will apply to this Agreement. |
| (d) | Multibranch Party. For purposes of Section 10(c) of this Agreement: |
| (i) | Party A is not a Multibranch Party. |
| (ii) | Party B is not a Multibranch Party |
| (e) | Calculation Agent. The Calculation Agent is Party A or such other entity designated from time to time by Party B and reasonably acceptable to Party B. |
| (f) | Credit Support Document. | With respect to Party A: Not Applicable. |
| With respect to Party B: Not Applicable. | ||
| (g) | Credit Support Provider. | With respect to Party A: Not Applicable. |
| With respect to Party B: Not Applicable. |
| (h) | Governing Law. This Agreement will be governed by and construed in accordance with the laws of the State of New York (without reference to its choice of law doctrine). |
| (i) | Netting of Payments. Subparagraph (ii) of Section 2(c) of this Agreement will not apply to any Transactions. |
| (j) | Consent to Telephone Recording. Each party hereby agrees that the other party or its agents may electronically record all telephone conversations between officers oremployees of the consenting party and the officers or employees of the other party who quote on, agree to, or otherwise discuss terms of foreign exchange agreements, interest exchange agreements, currency exchange agreements, commodity swapagreements, caps, collars, floors, and other rate or price protection transactions on behalf of the party. Any such recordings will be used only in connection with any misunderstanding or question arising with respect to any transaction discussedover the telephone by or on behalf of the parties. Each party further agrees to notify its officers and employees that telephone conversations with such persons acting on behalf of the other party will be recorded. |
| (a) | Set Off. Without affecting the provisions of this Agreement requiring the calculation of certain net payment amounts, all payments under this Agreement will be madewithout setoff or counterclaim, except that each party to this Agreement (such party, “Party X”) agrees that, upon an Early Termination Date resulting from an Event of Default with respect to Party X the other party hereto (such otherparty, a “Non-Defaulting Party”) may, without prior notice, reduce any amounts due and owing to Party X under this Agreement or any other transactions between Party X and the Non-Defaulting Party by setting off against such amounts anyamounts due and owing to the Non-Defaulting Party by Party X hereunder or under any other transactions between Party X and the Non-defaulting Party. For this purpose, any amount which is denominated in a currency other than U.S. Dollars may beconverted by the Non-defaulting Party into U.S. Dollars at the rate of exchange at which such party would be able, acting in a reasonable manner and in good faith, to purchase such amount. The rights provided by this paragraph are in addition to andnot in limitation of any other right or remedy (including any right to setoff, counterclaim, or otherwise withhold payment) to which a party may be entitled (whether by operation of law, contract or otherwise). Nothing in this Section shall beeffective to create a charge or other security interest. |
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| (b) | Definitions. The definitions and provisions contained in the 2000 ISDA Definitions (as published by the International Swaps and Derivatives Association, Inc.), withoutregard to any amendment or supplement thereof subsequent to the date of this Agreement (the “ISDA Definitions”), are hereby incorporated in this Agreement. If a conflict exists (1) between the provisions of the ISDA Definitions andthis Agreement, this Agreement will prevail, (2) between the provisions of a Confirmation and the ISDA Definitions, the Confirmation will prevail and (3) between the provisions of a Confirmation and this Agreement, the Confirmation willprevail. |
| (c) | Conditions Precedent. The condition precedent in Section 2(a)(iii)(1) of this Agreement shall not apply with respect to a payment or delivery owing by a party inrespect of a Transaction if the other party shall have satisfied in full all of its payment or delivery obligations under 2(a)(i) of this Agreement in respect of such Transaction and shall at the relevant time have no future payment or deliveryobligations, whether absolute or contingent, under Section 2(a)(i) in respect of such Transaction. |
| (d) | Default Under Specified Transactions. The provisions of Section 5(a)(v) of this Agreement are modified by adding, immediately prior to the semicolon at the endthereof, the following: |
“provided, however, that it shall not constitute an Event of Default under Section 5(a)(v)if (A) such event of default or failure to pay arises in the ordinary course of business by mistake, oversight, or transfer difficulties and (B) such event of default or failure to pay is remedied on or before the fifth Business Day afterthe occurrence or existence of such event of default or failure to pay.”
| (e) | Termination Payments by Non-Defaulting Party. Notwithstanding the provisions of Sections 6(e) and 6(d) of this Agreement, if there is a Defaulting Party, theobligations of the other party (the “Non-Defaulting Party”) to pay to the Defaulting Party any amount under Section 6(e) shall not arise until, and shall be subject to the conditions precedent that the Non-Defaulting Party shall havereceived confirmation satisfactory to it in its sole discretion that (1) all Transactions are terminated in accordance with Section 6(c), (2) each Specified Transaction shall have terminated pursuant to its specified termination dateor has been terminated through the exercise by a party of a right to terminate, and all amounts due under each Specified Transaction shall have been fully and finally paid, and (3) all obligations (contingent or absolute, matured or unmatured)of the Defaulting Party to make any payment to the Non-Defaulting Party shall have been fully and finally performed; provided that, if under the foregoing provisions it is determined that the Non-Defaulting Party is to make a payment to theDefaulting Party, there shall be deducted from the amount of such payment all amounts which the Defaulting Party may be obligated to pay under Section 11. With respect to the foregoing clause (2), it is expressly agreed that the Non-DefaultingParty shall have no obligation to exercise any right it may have to terminate a Specified Transaction prior to its specified termination date. |
| (f) | All Confirmations. With respect to each Transaction other than a Subject Transaction, Party B will, on or promptly after the Trade Date thereof, send Party A aConfirmation of the terms and conditions of the Transaction in substantially the form set out as Exhibit I to the Definitions (or such other form as may be agreed by the parties). Party B will promptly thereafter (1) confirm the accuracy ofsuch Confirmation or (2) request correction of the Confirmation, indicating how the terms of such Confirmation should be correctly stated and such other terms as should be added or deleted from such Confirmation to make it correct. The partieshereby agree that any exchange of telexes or facsimile transmissions or exchange of electronic messages on an electronic messaging system shall constitute a Confirmation for all purposes hereunder, even where not so specified therein. Each SubjectTransaction and each other Transaction (whether now existing or hereafter entered into) between the parties to this Agreement, in respect of which the Confirmation fails by its terms expressly to subject such transaction to the provisions of anyother master agreement between the parties, shall be deemed to incorporate the terms of, and shall be governed by and subject to, this Agreement and for purposes hereof shall be deemed to be a “Transaction.” |
| (g) | Transfer. The consent referred to in Section 7 shall not (after consideration of any tax or other consequences to a party of consenting to such assignment) beunreasonably withheld. |
| (h) | Definitions. The definition of “Default Rate” in Section 14 is hereby amended by deleting such definition and substituting in lieu thereof thefollowing: |
“Default Rate” means, for each day that such rate is relevant, the rate per annum equal tothe cost (without proof or evidence of any actual cost) to the relevant payee (as certified by it) if it
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were to fund or of funding the relevant amount for such day plus 1% per annum provided, however, that in respect of any overdue amount denominated inUnited States Dollars the Default Rate for each such day shall be the per annum rate which equals the overnight USD Federal Funds - H.15 rate for such day plus 2%.
| (i) | No Reliance. Without limiting the representations explicitly set out herein, each party has entered into this Agreement and each Transaction in reliance only upon itsjudgment, in order to accomplish legitimate business needs. Neither party holds itself out as advising, or any of its employees or agents as having any authority to advise, the other party as to whether or not it should enter into this Agreement orany Transaction. Neither party is receiving any compensation from the other party for providing advice in respect of this Agreement or any Transaction, and any such advice provided to such other party will not form the primary basis for aninvestment decision by such other party. |
| (j) | Impossibility. The occurrence of an Impossibility shall also be a Termination Event, as to which the Affected Party shall be subject to an Impossibility. For purposesof this Agreement, “Impossibility” shall mean the occurrence of a natural or man-made disaster, armed conflict, act of terrorism, riot, labor disruption or any other circumstances beyond its control after the date on which a Transaction isentered into which continues for a period of more than twenty (20) days and which makes it impossible (other than as a result of its own misconduct) for such a 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 othermaterial 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 CreditSupport Document relating to such Transaction. |
All terms and conditions of this Agreement applicable to an Illegality shallbe equally applicable to an Impossibility and the definition of Termination Event shall be amended to include Impossibility.
| (k) | Additional Representations. Section 3(a) is amended by adding the following paragraphs (vi) and (vii): |
| (vi) | No Agency. It is entering into this Agreement and each Transaction as principal (and not as agent or in any other capacity, fiduciary or otherwise). |
| (vii) | Eligible Contract Participant. It is an “eligible contract participant” as that term is defined in the Commodities Exchange Act, 7 U.S.C. § 1(a)(12). |
| (l) | FIRREA Provisions. |
| (i) | Maintenance of Records. Party B agrees to maintain in its official books and records: (i) a copy of the Confirmation for each Transaction, for so long as suchTransaction remains outstanding; and (ii) a copy of the Agreement and the Authorizing Resolution, for so long as any Transaction under the Agreement remains outstanding. |
| (ii) | Authorizing Resolution Representation. Party B makes the following representation to Party A, which representation will be deemed repeated at the times set forth inSection 3 of the Agreement: An Authorizing Resolution, as defined in Part 3 of this Schedule, is in full force and effect. |
| (iii) | Qualified Financial Contract. Each of Party A and Party B intends that each Transaction and the Agreement be categorized as a “swap agreement” and a “qualifiedfinancial contract” and that the Agreement be categorized as a “master agreement,” for purposes of Section 11(e)(8) of the Federal Deposit Insurance Act or any successor provisions. |
| (iv) | Authorized Officer. Party B agrees that this Agreement, any Credit Support Document to which it is a party, each Confirmation, and any other documentation relating to thisAgreement to which it is a party or that it is required to deliver will be executed and delivered by a duly appointed or elected and authorized officer of Party B of the level of vice-president or higher. |
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| (v) | Regulatory Compliance. Under Federal Reserve System Regulation W (12 CFR 223.1 et. seq.), Party A and Party B are affiliates of each other. Party A and Party B intend thatthis Agreement comply with requirements of Sections 23A and 23B of the Federal Reserve Act (12 USC 221 et. seq.) and the implementing federal regulations. |
The provisions of this Part 6 shall apply to each Subject Transaction (as definedbelow). In the event of any inconsistency in respect of a Subject Transaction between the provisions of this Part 6 and any other provision of this Agreement, the provisions of this Part 6 will apply in the case of such Subject Transaction.
(a) Definitions.
| (i) | “Business Day” means any day other than a Saturday or Sunday on which commercial banks are not required or authorized to close in New York, New York. |
| (ii) | “Commencement Date” means August 31, 2007. |
| (iii) | “FMV Change”, in respect of a Subject Transaction, means the FAS 156 mark to market for the Valuation Period as recorded by Party B against themortgage servicing right asset. |
| (iv) | “Interest Rate” means the average Thirty Day London InterBank Offered Rate (L1mo), as published in the Wall Street Journal on the first business day of eachmonth, plus 1.00 percent. |
| (v) | “Subject Transaction” means the dollar amount of mortgage servicing rights owned by Party B as reported on the accounting general ledger of Party B. |
| (vi) | “Termination Date”, unless earlier terminated in accordance with the provisions of this Agreement, means August 31, 2008; provided that, as long as noEvent of Default in respect of Party B is then continuing, with effect on the day prior to the Termination Date, the Termination Date will automatically be extended by successive periods of one year unless no less than 120 days prior to the thenTermination Date Party B notifies Party A that the Termination Date shall not be so extended. |
| (vii) | “Valuation Date” means each Business Day which shall also be the payment date. |
(c) DisputedCalculation. In the event that Party B disagrees with the calculation of FMV Change for any Valuation Date it shall notify Party A of such disagreement and the basis thereof within one (1) Business Day of receipt of the calculation forsuch Valuation Date set out in paragraph (b) above. In the event that Party A and Party B after good faith discussions are unable to agree on the FMV Change for such Valuation Date, the parties shall engage, on a shared expense basis, a thirdparty reasonably acceptable to both to determine such FMV Change.
(d) Payments. On each Valuation Date (i) if the FMVChange for the most recent Valuation Date is an increase in the market value of recorded mortgage servicing assets in the general ledger of Party B, Party B will pay to Party A an amount equal to the FMV Change or (ii) if such FMV Change is adecline in the market value of recorded mortgage servicing assets in the general ledger, Party A will pay to Party B an amount equal to the FMV Change . In the event of any disputed FMV Change, the relevant party shall pay the undisputed portion ofsuch valuation as required by the preceeding sentence and within two Business Days of resolution of the disputed FMV Change the relevant party shall pay the remaining portion together with interest on the unpaid amount at the Interest Rate for eachday from the Valuation Date to the date of payment of such amount in full.
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INTENDING TO BE LEGALLY BOUND HEREBY, the parties have caused this Schedule to be executed by their duly authorizedofficers as of the date first above written.
| GMAC Mortgage, LLC | GMAC Bank | ||||
| By: | /s/ James N. Young | By: | /s/ Robert E. Groody | ||
| Name: | James N. Young | Name: | Robert E. Groody | ||
| Title: | CFO | Title: | Chief Mortgage Accountant | ||
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(Multicurrency - Cross Border)
ISDA 1992 Master Agreement
SCHEDULE
ISDA Master Agreement (Net Funding)
dated as of August 31, 2007between
| GMAC Mortgage, LLC, | and | GMAC Bank |
| a Delaware limited liability company | a Utah industrial bank | |
| (referred to herein as “Party A”) | (referred to herein as “Party B”) |
This Agreement shall apply to and govern: (i) with effect on the Commencement Date and continuing until theTermination Date, each Subject Transaction (as defined in Part 6 hereof) without regard to the execution of a Confirmation in respect of such Subject Transaction and (ii) any other Transaction between the parties the terms of which are set outin a Confirmation the provisions of which expressly reference and incorporate by reference the provisions of this Master Agreement.
Part 1. TerminationProvisions.
| (a) | “Specified Entity” means in relation to Party A for the purpose of: |
Section 5(a)(vi): Not Applicable
Section 5(a)(vii): Not Applicable
Section 5(b)(iv): Not Applicableand inrelation to Party B for the purpose of:
Section 5(a)(v): Not Applicable
Section 5(a)(vi): Not ApplicableSection 5(a)(vii): Not Applicable
Section 5(b)(iv): Not Applicable
| (b) | “Specified Transaction” will have the meaning specified in Section 14 of this Agreement. |
(c) | The “Cross Default” provisions of Section 5(a)(vi): | will not apply to Party A and |
| will not apply to Party B |
| (d) | The “Credit Event Upon Merger” provisions of Section 5(b)(iv): | will not apply to Party A and |
| will not apply to Party B. | ||
| (e) | The “Automatic Early Termination” provision of Section 6(a): | will not apply to Party A and |
| will not apply to Party B. |
| (f) | Payments on Early Termination. For the purpose of Section 6(e) of this Agreement and subject to the provisions of Part 5 of this Schedule: |
| (i) | Market Quotation will apply. |
| (ii) | The Second Method will apply. |
| (g) | “Termination Currency” means United States Dollars. |
| (h) | “Additional Termination Event” shall mean termination of that certain ISDA Master Agreement (FMV), dated as of August 31, 2007. |
Part 2. Tax Representations.
| (a) | Payer Representations. For the purpose of Section 3(e) of this Agreement, Party A and Party B each make the following representation: |
| (b) | Payee Representations. |
| (1) | For the purpose of Section 3(f) of this Agreement, Party A represents that it is a limited liability company organized and existing under the laws of the State of Delaware. |
| (2) | For the purpose of Section 3(f) of this Agreement, Party B represents that it is an industrial bank organized and existing under the laws of the State of Utah. |
Part 3. Agreement to Deliver Documents.
For the purpose of Sections 4(a)(i) and (ii) of this Agreement, respectively, each party agrees to deliver (i) such tax forms, certificates and other documents as the other party may reasonably request and (ii) such documentsas the other party may reasonably request to evidence the power and authority of such party to enter into this Agreement and the Transactions hereunder and the incumbency of the individuals executing this Agreement and each Confirmation on itsbehalf.
Part 4. Miscellaneous.
| (a) | Address for Notices. Section 12(a) is hereby amended to delete the phrase “facsimile transmission or” from the third line thereof. For thepurpose of Section 12(a) of this Agreement: |
| (i) | Address for notices or communications to Party A: | GMAC Mortgage, LLC |
| 4 Walnut Grove Drive | ||
| Horsham, PA 19044 | ||
| Attention: Chief Financial Officer | ||
| Facsimile No: (215) 682-1151 | ||
| (ii) | Address for notices or communications to Party B: | GMAC Bank |
| 4 Walnut Grove Drive | ||
| Horsham, PA 19044 | ||
| Attention: EVP – Mortgage Operations | ||
| Facsimile No.: (215) 682-1770 | ||
| Telephone No.: (215) 682-3225 |
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| With a copy to: |
| GMAC Bank |
| 6985 Union Park Center, Suite 435 |
| Midvale, UT 84047 |
| Attention: Chief Financial Officer |
| Facsimile No.: (801) 790-5002 |
| Telephone No.: (801) 790-5062 |
| (b) | Process Agent. | With respect to Party A: Not Applicable. |
| With respect to Party B: Not Applicable. |
| (c) | Offices. The provisions of Section 10(a) will apply to this Agreement. |
| (d) | Multibranch Party. For purposes of Section 10(c) of this Agreement: |
| (i) | Party A is not a Multibranch Party. |
| (ii) | Party B is not a Multibranch Party |
| (e) | Calculation Agent. The Calculation Agent is Party B. |
| (f) | Credit Support Document. | With respect to Party A: Not Applicable. |
| With respect to Party B: Not Applicable. | ||
| (g) | Credit Support Provider. | With respect to Party A: Not Applicable. |
| With respect to Party B: Not Applicable. |
| (h) | Governing Law. This Agreement will be governed by and construed in accordance with the laws of the State of New York (without reference to its choice of law doctrine). |
| (i) | Netting of Payments. Subparagraph (ii) of Section 2(c) of this Agreement will not apply to any Transactions. |
| (j) | Consent to Telephone Recording. Each party hereby agrees that the other party or its agents may electronically record all telephone conversations between officers oremployees of the consenting party and the officers or employees of the other party who quote on, agree to, or otherwise discuss terms of foreign exchange agreements, interest exchange agreements, currency exchange agreements, commodity swapagreements, caps, collars, floors, and other rate or price protection transactions on behalf of the party. Any such recordings will be used only in connection with any misunderstanding or question arising with respect to any transaction discussedover the telephone by or on behalf of the parties. Each party further agrees to notify its officers and employees that telephone conversations with such persons acting on behalf of the other party will be recorded. |
| (a) | Set Off. Without affecting the provisions of this Agreement requiring the calculation of certain net payment amounts, all payments under this Agreement will be madewithout setoff or counterclaim, except that each party to this Agreement (such party, “Party X”) agrees that, upon an Early Termination Date resulting from an Event of Default with respect to Party X the other party hereto (such otherparty, a “Non-Defaulting Party”) may, without prior notice, reduce any amounts due and owing to Party X under this Agreement or any other transactions between Party X and the Non-Defaulting Party by setting off against such amounts anyamounts due and owing to the Non-Defaulting Party by Party X hereunder or under any other transactions between Party X and the Non-defaulting Party. For this purpose, any amount which is denominated in a currency other than U.S. Dollars may beconverted by the Non-defaulting Party into U.S. Dollars at the rate of exchange at which such party would be able, acting in a reasonable manner and in good faith, to purchase such amount. The rights provided by this paragraph are in addition to andnot in limitation of any other right or remedy (including any right to setoff, counterclaim, or otherwise withhold payment) to which a party may be entitled (whether by operation of law, contract or otherwise). Nothing in this Section shall beeffective to create a charge or other security interest. |
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| (b) | Definitions. The definitions and provisions contained in the 2000 ISDA Definitions (as published by the International Swaps and Derivatives Association, Inc.), withoutregard to any amendment or supplement thereof subsequent to the date of this Agreement (the “ISDA Definitions”), are hereby incorporated in this Agreement. If a conflict exists (1) between the provisions of the ISDA Definitions andthis Agreement, this Agreement will prevail, (2) between the provisions of a Confirmation and the ISDA Definitions, the Confirmation will prevail and (3) between the provisions of a Confirmation and this Agreement, the Confirmation willprevail. |
| (c) | Conditions Precedent. The condition precedent in Section 2(a)(iii)(1) of this Agreement shall not apply with respect to a payment or delivery owing by a party inrespect of a Transaction if the other party shall have satisfied in full all of its payment or delivery obligations under 2(a)(i) of this Agreement in respect of such Transaction and shall at the relevant time have no future payment or deliveryobligations, whether absolute or contingent, under Section 2(a)(i) in respect of such Transaction. |
| (d) | Default Under Specified Transactions. The provisions of Section 5(a)(v) of this Agreement are modified by adding, immediately prior to the semicolon at the endthereof, the following: |
“provided, however, that it shall not constitute an Event of Default under Section 5(a)(v)if (A) such event of default or failure to pay arises in the ordinary course of business by mistake, oversight, or transfer difficulties and (B) such event of default or failure to pay is remedied on or before the fifth Business Day afterthe occurrence or existence of such event of default or failure to pay.”
| (e) | Termination Payments by Non-Defaulting Party. Notwithstanding the provisions of Sections 6(e) and 6(d) of this Agreement, if there is a Defaulting Party, theobligations of the other party (the “Non-Defaulting Party”) to pay to the Defaulting Party any amount under Section 6(e) shall not arise until, and shall be subject to the conditions precedent that the Non-Defaulting Party shall havereceived confirmation satisfactory to it in its sole discretion that (1) all Transactions are terminated in accordance with Section 6(c), (2) each Specified Transaction shall have terminated pursuant to its specified termination dateor has been terminated through the exercise by a party of a right to terminate, and all amounts due under each Specified Transaction shall have been fully and finally paid, and (3) all obligations (contingent or absolute, matured or unmatured)of the Defaulting Party to make any payment to the Non-Defaulting Party shall have been fully and finally performed; provided that, if under the foregoing provisions it is determined that the Non-Defaulting Party is to make a payment to theDefaulting Party, there shall be deducted from the amount of such payment all amounts which the Defaulting Party may be obligated to pay under Section 11. With respect to the foregoing clause (2), it is expressly agreed that the Non-DefaultingParty shall have no obligation to exercise any right it may have to terminate a Specified Transaction prior to its specified termination date. |
| (f) | All Confirmations. With respect to each Transaction other than a Subject Transaction, Party B will, on or promptly after the Trade Date thereof, send Party A aConfirmation of the terms and conditions of the Transaction in substantially the form set out as Exhibit I to the Definitions (or such other form as may be agreed by the parties). Party B will promptly thereafter (1) confirm the accuracy ofsuch Confirmation or (2) request correction of the Confirmation, indicating how the terms of such Confirmation should be correctly stated and such other terms as should be added or deleted from such Confirmation to make it correct. The partieshereby agree that any exchange of telexes or facsimile transmissions or exchange of electronic messages on an electronic messaging system shall constitute a Confirmation for all purposes hereunder, even where not so specified therein. Each SubjectTransaction and each other Transaction (whether now existing or hereafter entered into) between the parties to this Agreement, in respect of which the Confirmation fails by its terms expressly to subject such transaction to the provisions of anyother master agreement between the parties, shall be deemed to incorporate the terms of, and shall be governed by and subject to, this Agreement and for purposes hereof shall be deemed to be a “Transaction.” |
| (g) | Transfer. The consent referred to in Section 7 shall not (after consideration of any tax or other consequences to a party of consenting to such assignment) beunreasonably withheld. |
| (h) | Definitions. The definition of “Default Rate” in Section 14 is hereby amended by deleting such definition and substituting in lieu thereof thefollowing: |
“Default Rate” means, for each day that such rate is relevant, the rate per annum equal tothe cost (without proof or evidence of any actual cost) to the relevant payee (as certified by it) if it
4
were to fund or of funding the relevant amount for such day plus 1% per annum provided, however, that in respect of any overdue amount denominated inUnited States Dollars the Default Rate for each such day shall be the per annum rate which equals the overnight USD Federal Funds - H.15 rate for such day plus 2%.
| (i) | No Reliance. Without limiting the representations explicitly set out herein, each party has entered into this Agreement and each Transaction in reliance only upon itsjudgment, in order to accomplish legitimate business needs. Neither party holds itself out as advising, or any of its employees or agents as having any authority to advise, the other party as to whether or not it should enter into this Agreement orany Transaction. Neither party is receiving any compensation from the other party for providing advice in respect of this Agreement or any Transaction, and any such advice provided to such other party will not form the primary basis for aninvestment decision by such other party. |
| (j) | Impossibility. The occurrence of an Impossibility shall also be a Termination Event, as to which the Affected Party shall be subject to an Impossibility. For purposesof this Agreement, “Impossibility” shall mean the occurrence of a natural or man-made disaster, armed conflict, act of terrorism, riot, labor disruption or any other circumstances beyond its control after the date on which a Transaction isentered into which continues for a period of more than twenty (20) days and which makes it impossible (other than as a result of its own misconduct) for such a 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 othermaterial 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 CreditSupport Document relating to such Transaction. |
All terms and conditions of this Agreement applicable to an Illegality shallbe equally applicable to an Impossibility and the definition of Termination Event shall be amended to include Impossibility.
| (k) | Additional Representations. Section 3(a) is amended by adding the following paragraphs (vi) and (vii): |
| (vi) | No Agency. It is entering into this Agreement and each Transaction as principal (and not as agent or in any other capacity, fiduciary or otherwise). |
| (vii) | Eligible Contract Participant. It is an “eligible contract participant” as that term is defined in the Commodities Exchange Act, 7 U.S.C. § 1(a)(12). |
| (l) | FIRREA Provisions. |
| (i) | Maintenance of Records. Party B agrees to maintain in its official books and records: (i) a copy of the Confirmation for each Transaction, for so long as suchTransaction remains outstanding; and (ii) a copy of the Agreement and the Authorizing Resolution, for so long as any Transaction under the Agreement remains outstanding. |
| (ii) | Authorizing Resolution Representation. Party B makes the following representation to Party A, which representation will be deemed repeated at the times set forth inSection 3 of the Agreement: An Authorizing Resolution, as defined in Part 3 of this Schedule, is in full force and effect. |
| (iii) | Qualified Financial Contract. Each of Party A and Party B intends that each Transaction and the Agreement be categorized as a “swap agreement” and a “qualifiedfinancial contract” and that the Agreement be categorized as a “master agreement,” for purposes of Section 11(e)(8) of the Federal Deposit Insurance Act or any successor provisions. |
| (iv) | Authorized Officer. Party B agrees that this Agreement, any Credit Support Document to which it is a party, each Confirmation, and any other documentation relating to thisAgreement to which it is a party or that it is required to deliver will be executed and delivered by a duly appointed or elected and authorized officer of Party B of the level of vice-president or higher. |
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| (v) | Regulatory Compliance. Under Federal Reserve System Regulation W (12 CFR 223.1 et. seq.), Party A and Party B are affiliates of each other. Party A and Party B intend thatthis Agreement comply with requirements of Sections 23A and 23B of the Federal Reserve Act (12 USC 221 et. seq.) and the implementing federal regulations. |
The provisions of this Part 6 shall apply to each Subject Transaction (as definedbelow). In the event of any inconsistency in respect of a Subject Transaction between the provisions of this Part 6 and any other provision of this Agreement, the provisions of this Part 6 will apply in the case of such Subject Transaction.
(a) Definitions.
| (i) | “Business Day” means any day other than a Saturday or Sunday on which commercial banks are not required or authorized to close in New York, New York. |
| (ii) | “Commencement Date” means August 31, 2007. |
| (iii) | “Funding Fee” means the product of (A) the Subject Transaction, as recorded by Party B as of the Valuation Date, and (B) the Interest Rate. |
| (iv) | “Interest Rate” means the average Thirty Day London InterBank Offered Rate (L1mo), as published in the Wall Street Journal on the first business day of eachmonth, plus 1.00 percent. |
| (v) | “Net Servicing Fee” means the sum of the amounts posted to the general ledger of Party B for amounts collected or earned by Party B (i.e. normal servicingfees and ancillary income) less any associated servicing expenses paid or incurred, as is customary for normal servicing of residential mortgage loans. |
| (vi) | “Subject Transaction” means the dollar amount of Mortgage Servicing Rights owned by Party B as reported on the accounting general ledger of Party B and thedollar amount of Servicing Advances owned by Party B as reported on the accounting general ledger of Party B |
| (vii) | “Termination Date”, unless earlier terminated in accordance with the provisions of this Agreement, means August 31, 2008; provided that, as long as noEvent of Default in respect of Party B is then continuing, with effect on the day prior to the Termination Date, the Termination Date will automatically be extended by successive periods of one year unless no less than 120 days prior to the thenTermination Date Party B notifies Party A that the Termination Date shall not be so extended. |
| (x) | “Valuation Date” means each Business Day which shall also be the payment date. |
(d) Payments. On each Valuation Date Party B will pay the Net Servicing Fee to Party A and Party A will pay the FundingFee to Party B. In the event of any Disputed Calculation, the relevant party shall pay the undisputed portion of such valuation as required by the preceeding sentence and within two Business Days of resolution of the Disputed Calculation therelevant party shall pay the remaining portion together with interest on the unpaid amount at the Interest Rate for each day from the Valuation Date to the date of payment of such amount in full.
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INTENDING TO BE LEGALLY BOUND HEREBY, the parties have caused this Schedule to be executed by their duly authorizedofficers as of the date first above written.
| GMAC Mortgage, LLC | GMAC Bank | ||||
| By: | /s/ James N. Young | By: | /s/ Robert E. Groody | ||
| Name: | James N. Young | Name: | Robert E. Groody | ||
| Title: | CFO | Title: | Chief Mortgage Accountant | ||
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(Multicurrency - Cross Border)
ISDA 1992 Master Agreement
to the
dated as of July 1, 2008
(amending and superseding Schedule dated as of May 1, 2007)| GMAC Mortgage, LLC, | and | GMAC Bank |
| a Delaware limited liability company | a Utah industrial bank | |
| (referred to herein as “Party A”) | (referred to herein as “Party B”) |
This Agreement shall apply to and govern: (i) with effect on the Commencement Date and continuing until theTermination Date, each Subject Transaction (as defined in Part 6 hereof) without regard to the execution of a Confirmation in respect of such Subject Transaction and (ii) any other Transaction between the parties the terms of which are set outin a Confirmation the provisions of which expressly reference and incorporate by reference the provisions of this Master Agreement.
Part 1. TerminationProvisions.
| (a) | “Specified Entity” means in relation to Party A for the purpose of: | ||
| Section 5(a)(v): Not Applicable | |||
| Section 5(a)(vi): Not Applicable | |||
| Section 5(a)(vii): Not Applicable | |||
| Section 5(b)(iv): Not Applicable | |||
| and in relation to Party B for the purpose of: | |||
| Section 5(a)(v): Not Applicable | |||
| Section 5(a)(vi): Not Applicable | |||
| Section 5(a)(vii): Not Applicable | |||
| Section 5(b)(iv): Not Applicable | |||
| (b) | “Specified Transaction” will have the meaning specified in Section 14 of this Agreement. | ||
| (c) | The “Cross Default” provisions of Section 5(a)(vi): will not apply to Party Aand | ||
| will not apply to Party B | |||
| (d) | The “Credit Event Upon Merger” provisions of Section 5(b)(iv): | will not apply to Party A and | |
| will not apply to Party B. | |||
| (e) | The “Automatic Early Termination” provision of Section 6(a): | will not apply to Party A and | |
| will not apply to Party B. | |||
| (f) | Payments on Early Termination. For the purpose of Section 6(e) of this Agreement and subject to the provisions of Part 5 of this Schedule: | ||
| (i) Market Quotation will apply. | |||
| (ii) The Second Method will apply. | |||
| (g) | “Termination Currency” means United States Dollars. | ||
| (h) | “Additional Termination Event” will not apply. | ||
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Part 2. Tax Representations.
| (a) | Payer Representations. For the purpose of Section 3(e) of this Agreement, Party A and Party B each make the following representation: |
| (b) | Payee Representations. |
| (1) | For the purpose of Section 3(f) of this Agreement, Party A represents that it is a limited liability company organized and existing under the laws of the State of Delaware. |
| (2) | For the purpose of Section 3(f) of this Agreement, Party B represents that it is an industrial bank organized and existing under the laws of the State of Utah. |
Part 3. Agreement to Deliver Documents.
For the purpose of Sections 4(a)(i) and (ii) of this Agreement, respectively, each party agrees to deliver (i) such tax forms, certificates and other documents as the other party may reasonably request and (ii) such documentsas the other party may reasonably request to evidence the power and authority of such party to enter into this Agreement and the Transactions hereunder and the incumbency of the individuals executing this Agreement and each Confirmation on itsbehalf.
Part 4. Miscellaneous.
| (a) | Address for Notices. Section 12(a) is hereby amended to delete the phrase “facsimile transmission or” from the third line thereof. For the purpose of Section12(a) of this Agreement: | ||
(i) Address for notices or communications to Party A: | GMAC Mortgage, LLC 1100 Virginia Drive Attention: Chief Financial Officer | ||
(ii) Address for notices or communications to Party B: | GMAC Bank 1100 Virginia Drive Attention: EVP – Chief OperatingOfficer Facsimile No.: (215) 682-1770 | ||
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With a copy to: |
| GMAC Bank |
| 6985 Union Park Center, Suite 435 |
| Midvale, UT 84047 |
| Attention: Chief Financial Officer |
| Facsimile No.: (801) 790-5002 |
| Telephone No.: (801) 790-5062 |
| (b) | Process Agent. | With respect to Party A: Not Applicable. | ||
| With respect to Party B: Not Applicable. | ||||
| (c) | Offices. The provisions of Section 10(a) will apply to this Agreement. | |||
| (d) | Multibranch Party. For purposes of Section 10(c) of this Agreement: | |||
(i) Party A is not a Multibranch Party. | ||||
(ii) Party B is not a Multibranch Party | ||||
| (e) | Calculation Agent. The Calculation Agent is the FMV Determination Agent (as defined in Part 6 hereof). | |||
| (f) | Credit Support Document. | With respect to Party A: Not Applicable. | ||
| With respect to Party B: Not Applicable. | ||||
| (g) | Credit Support Provider. | With respect to Party A: Not Applicable. | ||
| With respect to Party B: Not Applicable. | ||||
| (h) | Governing Law. This Agreement will be governed by and construed in accordance with the laws of the State of New York (without reference to its choice of law doctrine). | |||
| (i) | Netting of Payments. Subparagraph (ii) of Section 2(c) of this Agreement will not apply to any Transactions. | |||
| (j) | Consent to Telephone Recording. Each party hereby agrees that the other party or its agents may electronically record all telephone conversations between officers oremployees of the consenting party and the officers or employees of the other party who quote on, agree to, or otherwise discuss terms of foreign exchange agreements, interest exchange agreements, currency exchange agreements, commodity swapagreements, caps, collars, floors, and other rate or price protection transactions on behalf of the party. Any such recordings will be used only in connection with any misunderstanding or question arising with respect to any transaction discussedover the telephone by or on behalf of the parties. Each party further agrees to notify its officers and employees that telephone conversations with such persons acting on behalf of the other party will be recorded. | |||
| Part 5. Other Provisions. | ||||
| (a) | Set Off. Without affecting the provisions of this Agreement requiring the calculation of certain net payment amounts, all payments under this Agreement will be madewithout setoff or counterclaim, except that each party to this Agreement (such party, “Party X”) agrees that, upon an Early Termination Date resulting from an Event of Default with respect to Party X the other party hereto (such otherparty, a “Non-Defaulting Party”) may, without prior notice, reduce any amounts due and owing to Party X under this Agreement or any other transactions between Party X and the Non-Defaulting Party by setting off against such amounts anyamounts due and owing to the Non-Defaulting Party by Party X hereunder or under any other transactions between Party X and the Non-defaulting Party. For this purpose, any amount which is denominated in a currency other than U.S. Dollars may beconverted by the Non-defaulting Party into U.S. Dollars at the rate of exchange at which such party would be able, acting in a reasonable manner and in good faith, to purchase such amount. The rights provided by this paragraph are in addition to andnot in limitation of any other right or remedy (including any right to setoff, counterclaim, or otherwise withhold payment) to which a party may be entitled (whether by operation of law, contract or otherwise). Nothing in this Section shall beeffective to create a charge or other security interest. | |||
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| (b) | Definitions. The definitions and provisions contained in the 2000 ISDA Definitions (as published by the International Swaps and Derivatives Association, Inc.), without regard toany amendment or supplement thereof subsequent to the date of this Agreement (the “ISDA Definitions”), are hereby incorporated in this Agreement. If a conflict exists (1) between the provisions of the ISDA Definitions and this Agreement,this Agreement will prevail, (2) between the provisions of a Confirmation and the ISDA Definitions, the Confirmation will prevail and (3) between the provisions of a Confirmation and this Agreement, the Confirmation will prevail. |
| (c) | Conditions Precedent. The condition precedent in Section 2(a)(iii)(1) of this Agreement shall not apply with respect to a payment or delivery owing by a party in respect of aTransaction if the other party shall have satisfied in full all of its payment or delivery obligations under 2(a)(i) of this Agreement in respect of such Transaction and shall at the relevant time have no future payment or delivery obligations,whether absolute or contingent, under Section 2(a)(i) in respect of such Transaction. |
| (d) | Default Under Specified Transactions. The provisions of Section 5(a)(v) of this Agreement are modified by adding, immediately prior to the semicolon at the end thereof, thefollowing: |
“provided, however, that it shall not constitute an Event of Default under Section 5(a)(v) if (A) such event of default or failure to pay arises in theordinary course of business by mistake, oversight, or transfer difficulties and (B) such event of default or failure to pay is remedied on or before the fifth Business Day after the occurrence or existence of such event of default or failure topay.” | |
| (e) | Termination Payments by Non-Defaulting Party. Notwithstanding the provisions of Sections 6(e) and 6(d) of this Agreement, if there is a Defaulting Party, the obligations of theother party (the “Non-Defaulting Party”) to pay to the Defaulting Party any amount under Section 6(e) shall not arise until, and shall be subject to the conditions precedent that the Non-Defaulting Party shall have received confirmationsatisfactory to it in its sole discretion that (1) all Transactions are terminated in accordance with Section 6(c), (2) each Specified Transaction shall have terminated pursuant to its specified termination date or has been terminated through theexercise by a party of a right to terminate, and all amounts due under each Specified Transaction shall have been fully and finally paid, and (3) all obligations (contingent or absolute, matured or unmatured) of the Defaulting Party to make anypayment to the Non-Defaulting Party shall have been fully and finally performed; provided that, if under the foregoing provisions it is determined that the Non-Defaulting Party is to make a payment to the Defaulting Party, there shall be deductedfrom the amount of such payment all amounts which the Defaulting Party may be obligated to pay under Section 11. With respect to the foregoing clause (2), it is expressly agreed that the Non-Defaulting Party shall have no obligation to exercise anyright it may have to terminate a Specified Transaction prior to its specified termination date. |
| (f) | All Confirmations. With respect to each Transaction other than a Subject Transaction, Party B will, on or promptly after the Trade Date thereof, send Party A a Confirmation ofthe terms and conditions of the Transaction in substantially the form set out as Exhibit I to the Definitions (or such other form as may be agreed by the parties). Party B will promptly thereafter (1) confirm the accuracy of such Confirmation or (2)request correction of the Confirmation, indicating how the terms of such Confirmation should be correctly stated and such other terms as should be added or deleted from such Confirmation to make it correct. The parties hereby agree that any exchangeof telexes or facsimile transmissions or exchange of electronic messages on an electronic messaging system shall constitute a Confirmation for all purposes hereunder, even where not so specified therein. Each Subject Transaction and each otherTransaction (whether now existing or hereafter entered into) between the parties to this Agreement, in respect of which the Confirmation fails by its terms expressly to subject such transaction to the provisions of any other master agreement betweenthe parties, shall be deemed to incorporate the terms of, and shall be governed by and subject to, this Agreement and for purposes hereof shall be deemed to be a “Transaction.” |
| (g) | Transfer. The consent referred to in Section 7 shall not (after consideration of any tax or other consequences to a party of consenting to such assignment) be unreasonablywithheld. |
| (h) | Definitions. The definition of “Default Rate” in Section 14 is hereby amended by deleting such definition and substituting in lieu thereof thefollowing: |
“Default Rate” means, for each day that such rate is relevant, the rate per annum equal to the cost (without proof orevidence of any actual cost) to the relevant payee (as certified by it) if it |
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| (i) | No Reliance. Without limiting the representations explicitly set out herein, each party has entered into this Agreement and each Transaction in reliance only upon itsjudgment, in order to accomplish legitimate business needs. Neither party holds itself out as advising, or any of its employees or agents as having any authority to advise, the other party as to whether or not it should enter into this Agreement orany Transaction. Neither party is receiving any compensation from the other party for providing advice in respect of this Agreement or any Transaction, and any such advice provided to such other party will not form the primary basis for aninvestment decision by such other party. |
| (j) | Impossibility. The occurrence of an Impossibility shall also be a Termination Event, as to which the Affected Party shall be subject to an Impossibility. For purposesof this Agreement, “Impossibility” shall mean the occurrence of a natural or man-made disaster, armed conflict, act of terrorism, riot, labor disruption or any other circumstances beyond its control after the date on which a Transaction isentered into which continues for a period of more than twenty (20) days and which makes it impossible (other than as a result of its own misconduct) for such a 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 othermaterial 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 CreditSupport Document relating to such Transaction. |
All terms and conditions of this Agreement applicable to an Illegality shallbe equally applicable to an Impossibility and the definition of Termination Event shall be amended to include Impossibility.
| (k) | Additional Representations. Section 3(a) is amended by adding the following paragraphs (vi) and (vii): |
| (vi) | No Agency. It is entering into this Agreement and each Transaction as principal (and not as agent or in any other capacity, fiduciary or otherwise). |
| (vii) | Eligible Contract Participant. It is an “eligible contract participant” as that term is defined in the Commodities Exchange Act, 7 U.S.C. § 1(a)(12). |
| (l) | FIRREA Provisions. |
| (i) | Maintenance of Records. Party B agrees to maintain in its official books and records: (i) a copy of the Confirmation for each Transaction, for so long as suchTransaction remains outstanding; and (ii) a copy of the Agreement and the Authorizing Resolution, for so long as any Transaction under the Agreement remains outstanding. |
| (ii) | Authorizing Resolution Representation. Party B makes the following representation to Party A, which representation will be deemed repeated at the times set forth inSection 3 of the Agreement: An Authorizing Resolution, as defined in Part 3 of this Schedule, is in full force and effect. |
| (iii) | Qualified Financial Contract. Each of Party A and Party B intends that each Transaction and the Agreement be categorized as a “swap agreement” and a “qualifiedfinancial contract” and that the Agreement be categorized as a “master agreement,” for purposes of Section 11(e)(8) of the Federal Deposit Insurance Act or any successor provisions. |
| (iv) | Authorized Officer. Party B agrees that this Agreement, any Credit Support Document to which it is a party, each Confirmation, and any other documentation relating to thisAgreement to which it is a party or that it is required to deliver will be executed and delivered by a duly appointed or elected and authorized officer of Party B of the level of vice-president or higher. |
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| (v) | Regulatory Compliance. Under Federal Reserve System Regulation W (12 CFR 223.1 et. seq.), Party A and Party B are affiliates of each other. Party A and Party B intend thatthis Agreement comply with requirements of Sections 23A and 23B of the Federal Reserve Act (12 USC 221 et. seq.) and the implementing federal regulations. |
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The provisions of this Part 6 shall apply to each Subject Transaction (as definedbelow). In the event of any inconsistency in respect of a Subject Transaction between the provisions of this Part 6 and any other provision of this Agreement, the provisions of this Part 6 will apply in the case of such Subject Transaction.
| (a) | Definitions. |
| (i) | “Business Day” means any day other than a Saturday or Sunday on which commercial banks are not required or authorized to close in New York, New York. |
| (ii) | “Commencement Date” means July 1, 2008. |
| (iii) | “Expected Pull Through” means, in respect of a Subject Transaction, the percent of locked pipeline loans which are expected to be funded. |
| (iv) | “FMV Change”, in respect of a Subject Transaction, means the aggregate of the following: |
(B) for Pipeline Loans, the product of the LoanCommitment Amount and the difference between the Pipeline FMV and the Lock FMV. (FMV Change = Loan Commitment Amount X Expected Pull Through X (Pipeline FMV – Lock FMV)).
| (v) | “FMV Determination Agent” means Party B or such other entity designated from time to time by Party B and reasonably acceptable to Party A. |
| (vi) | “Funded Loan” means, in respect of a Subject Transaction at the time of funding, the underlying loan that has been funded by, and delivered to, Party B by anAffiliate or third party mortgage correspondent in satisfaction of its legally binding commitment to Party B. |
| (vii) | “Funded Loan Amount” means, in respect of a Funded Loan, the unpaid principal balance at time of funding by Party B. |
| (viii) | “Funding FMV” means, in respect of a Subject Transaction, the fair market value of a loan on the funding date as determined by the FMV Determination Agentusing customary market valuation techniques. |
| (ix) | “Loan Commitment Amount” means, in respect of a Subject Transaction, the unpaid principal balance of the underlying loan. |
| (x) | “Lock FMV” means, in respect of a Subject Transaction, the price at which a loan is locked by the relevant mortgage Affiliate or third party correspondentwith Parties A and B and recorded in the applicable Mortgage Origination Loan System(s). |
| (xi) | “Mortgage Origination Loan System” means, as applicable, the Wholesale Asset Loan Tracking system (“WALT”), Eclipse, Pilot, Co-Pilot or futureapplications to be developed or acquired which facilitate the registration of or application of a consumer mortgage loan transaction for Party A and or B |
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| (xii) | “Payment Date” means the fifth (5th) Business Day of each calendar month. |
| (xiii) | “Pipeline Loan”, at any time, but subject to Part 6(b) hereof, means each Subject Transaction identified in the applicable Mortgage Origination LoanSystem(s) that is not a Funded Loan. |
| (xiv) | “Pipeline FMV” means, in respect of a Subject Transaction, the fair market value of a Pipeline Loan on the last calendar day of each month as determined bythe FMV Determination Agent using customary market valuation techniques. |
| (xv) | “Pipeline Risk” means the risk of loan fall out (cancellation) or market value change from the point of loan commitment (borrower lock) to loan funding orloan sale. |
| (xvi) | “Subject Transaction” means a legally binding commitment by Party B to purchase, either for its “Held for Sale” (HFS) portfolio or its “Heldfor Investment” (HFI ) portfolio, any loan from certain loan products and programs, as mutually agreed to by Party A and Party B, for which “Pipeline Risk” is managed by the ResCap Capital Markets Group. |
| (xvii) | “Termination Date” unless earlier terminated in accordance with the provisions of this Agreement, means July 1, 2009; provided that, as long as no Eventof Default in respect of Party B is then continuing, with effect on the day prior to the Termination Date, the Termination Date will automatically be extended by successive periods of one year unless no less than 120 days prior to the thenTermination Date Party B notifies Party A that the Termination Date shall not be so extended; and provided, further, that the Termination Date shall not extend beyond May 1, 2013. |
| (xviii) | “Valuation Period” means such successive period commencing on, and including, the first calendar day of each calendar month (or the Commencement Date in thecase of the first such period) and ending on, but excluding, the first calendar day of the next succeeding calendar month (or the Termination Date, in the case of the last such period). |
(d)Payments. On each Payment Date (i) if the FMV Change for the most recent Valuation Period is positive, Party B will pay to Party A an amount equal to such FMV Change or (ii) if such FMV Change is negative, Party A will pay toParty B an amount equal to such FMV Change. In the event of any disputed FMV Change, the relevant party shall pay the undisputed portion of such valuation as required by the preceeding sentence and within two Business Days of resolution of thedisputed FMV Change the relevant party shall pay the remaining portion together with interest on the unpaid amount at the Interest Rate for each day from the Payment Date to the date of payment of such amount in full.
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INTENDING TO BE LEGALLY BOUND HEREBY, the parties have caused this Schedule to be executed by their duly authorized officers as of the date first above written.
| GMAC Mortgage, LLC | GMAC Bank | ||||
| By: | /s/ Sandy Blitzer | By: | /s/ Albert J. Celini | ||
| Name: | Sandy Blitzer | Name: | Albert J. Celini | ||
| Title: | Vice President | Title: | VP Asst. Sec. | ||
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EXHIBIT A
ILLUSTRATION OF CALCULATION
Product: 7/1 ARM
Note Rate: 6.00%
Loan Amount:$400,000
Lock Date: 02/16/2008
Fund Date: 03/15/2008
Lock Window: 30 Days
Commitment: Best Efforts
Lock Price: 101.00Fannie 7 Year Index on 02/16/2008: 5.25%
Fannie 7 Year Index on 03/15/2008: 5.50%Buyup Ratio: 3:1
Bank Cost of Funds: 4.00%Step 1: Calculate Price at Funding:
Funing Prince = Lock Price + (Fannie 7 Year Index on Lock Date – Fannie 7 Year Index on Fund Date)*100*Buyup Ratio
100.25 = 101.00 + (5.25-5.50)*100*3Step 2: CalculateMarket Value Swap Payment:
Payment = -1*[Loan Amount* ((Funding Price + (Note Rate – Bank Cost of Funds)*(9/360) – LockPrice))/100]
2,998 = -1*[400,000*((100.25+(.06-.04)*(9/360)-101.00))/100]
GMAC Mortgage owes GMAC Bank $2,998.9
Exhibit 10.1
International Swaps and Derivatives Association, Inc.
2002 MASTER AGREEMENT
Bank of America, N.A. | and | LKQ Corporation |
Accordingly, the parties agree as follows:—
| 1. | Interpretation |
(a)Definitions. The terms defined in Section 14 and elsewhere in this Master Agreement will have the meanings therein specified for the purpose of this Master Agreement.
| 2. | Obligations |
(a) GeneralConditions.
(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.
Copyright © 2002 by International Swaps and Derivatives Association, Inc.
(iii) Each obligation of each party under Section 2(a)(i) is subject to (1) thecondition 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 hasoccurred or been effectively designated and (3) each other condition specified in this Agreement to be a condition precedent for the purpose of this Section 2(a)(iii).
(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 automaticallysatisfied 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 which thelarger aggregate amount would have been payable to pay to the other party the excess of the larger aggregate amount over the smaller aggregate amount.
(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 governmentalrevenue 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 deductedor 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 suchpayment to such authorities; and
| 2 | ISDA® 2002 |
(4) if such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment to which Y isotherwise 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 havereceived 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 nothave occurred but for (I) any action taken by a taxing authority, or brought in a court of competent jurisdiction, after a Transaction is entered into (regardless of whether such action is taken or brought with respect to a party to thisAgreement) 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 deductionor 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 ofsuch 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)).
| 3. | Representations |
Each party makes therepresentations contained in Sections 3(a), 3(b), 3(c), 3(d), 3(e) and 3(f) and, if specified in the Schedule as applying, 3(g) to the other party (which representations will be deemed to be repeated by each party on each date on which a Transactionis entered into and, in the case of the representations in Section 3(f), at all times until the termination of this Agreement). If any “Additional Representation” is specified in the Schedule or any Confirmation as applying, the partyor parties specified for such Additional Representation will make and, if applicable, be deemed to repeat such Additional Representation at the time or times specified for such Additional Representation.
(a) Basic Representations.
(ii) Powers. It has the power to execute this Agreement and any other documentation relating to this Agreement to which itis 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 SupportDocument to which it is a party and has taken all necessary action to authorise such execution, delivery and performance;
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(iii) No Violation or Conflict. Such execution, delivery and performance donot 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 oraffecting it or any of its assets;
(iv) Consents. All governmental and other consents that are required to havebeen 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 partyconstitute 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 andsubject, as to enforceability, to equitable principles of general application (regardless of whether enforcement is sought in a proceeding in equity or at law)).
(d) Accuracy ofSpecified 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 asbeing made by it for the purpose of this Section 3(e) is accurate and true.
(f) Payee Tax Representations. Eachrepresentation specified in the Schedule as being made by it for the purpose of this Section 3(f) is accurate and true.
(g) NoAgency. It is entering into this Agreement, including each Transaction, as principal and not as agent of any person or entity.
| 4. | Agreements |
Each party agrees with theother 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:—
(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
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(iii) upon reasonable demand by such other party, any form or document that may be requiredor 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 Taxor 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 anysuch 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,
1991 Isda Definitions Pdf
(d) Tax Agreement. It willgive 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.
| 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 orany Specified Entity of such party of any of the following events constitutes (subject to Sections 5(c) and 6(e)(iv)) 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 underSection 2(a)(i) or 9(h)(i)(2) or (4) required to be made by it if such failure is not remedied on or before the first Local Business Day in the case of any such payment or the first Local Delivery Day in the case of any such deliveryafter, in each case, notice of such failure is given to the party;
(ii) Breach of Agreement; Repudiation ofAgreement.
(1) 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 9(h)(i)(2) or (4) or to give noticeof 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 within 30 days after notice of suchfailure is given to the party; or
(2) the party disaffirms, disclaims, repudiates or rejects, in whole or in part, orchallenges the
validity of, this Master Agreement, any Confirmation executed and delivered by that party or any Transactionevidenced by such a Confirmation (or such action is taken by any person or entity appointed or empowered to operate it or act on its behalf);
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(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 failureis continuing after any applicable grace period has elapsed;
(2) the expiration or termination of such Credit Support Documentor the failing or ceasing of
such Credit Support Document, or any security interest granted by such party or such CreditSupport Provider to the other party pursuant to any such Credit Support Document, to be in full force and effect for the purpose of this Agreement (in each case other than in accordance with its terms) prior to the satisfaction of all obligations ofsuch party under each Transaction to which such Credit Support Document relates without the written consent of the other party; or
(iv) Misrepresentation. A representation (other than a representation under Section 3(e) or 3(f)) made or repeated ordeemed 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 tohave been made or repeated;
(v) Default Under Specified Transaction. The party, any Credit Support Provider ofsuch party or any applicable Specified Entity of such party:—
(1) defaults (other than by failing to make a delivery)under a Specified Transaction or any credit support arrangement relating to a Specified Transaction and, after giving effect to any applicable notice requirement or grace period, such default results in a liquidation of, an acceleration ofobligations under, or an early termination of, that Specified Transaction;
(2) defaults, after giving effect to any applicablenotice requirement or grace period, in making any payment due on the last payment or exchange date of, or any payment on early termination of, a Specified Transaction (or, if there is no applicable notice requirement or grace period, such defaultcontinues for at least one Local Business Day);
(3) defaults in making any delivery due under (including any delivery due onthe last delivery or exchange date of) a Specified Transaction or any credit support arrangement relating to a Specified Transaction and, after giving effect to any applicable notice requirement or grace period, such default results in a liquidationof, an acceleration of obligations under, or an early termination of, all transactions outstanding under the documentation applicable to that Specified Transaction; or
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(vi) Cross-Default. If “Cross-Default” is specified in the Scheduleas applying to the party, the occurrence or existence of:—
(1) a default, event of default or other similar condition orevent (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) where the aggregate principal amount of such agreements or instruments, either alone or together with the amount, if any, referred to in clause
(vii) Bankruptcy. The party, any CreditSupport Provider of such party or any applicable Specified Entity of such party:—
(1) is dissolved (other than pursuantto 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 orcomposition with or for the benefit of its creditors; (4)(A) institutes or has instituted against it, by a regulator, supervisor or any similar official with primary insolvency, rehabilitative or regulatory jurisdiction over it in thejurisdiction of its incorporation or organisation or the jurisdiction of its head or home office, a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affectingcreditors’ rights, or a petition is presented for its winding-up or liquidation by it or such regulator, supervisor or similar official, or (B) has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or anyother 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 such proceeding or petition is instituted or presented by a person or entitynot described in clause (A) above and either (I) 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 (II) is not dismissed, discharged, stayedor restrained in each case within 15 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 partytake 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 maintainspossession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 15 days thereafter; (8) causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has ananalogous effect to any of the events specified in clauses (1) to (7) above (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
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(viii) Merger Without Assumption. The party or any Credit Support Provider ofsuch party consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, or reorganises, reincorporates or reconstitutes into or as, another entity and, at the time of such consolidation,amalgamation, merger, transfer, reorganisation, reincorporation or reconstitution:—
(1) the resulting, surviving ortransferee 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; or
(2) the benefits of any Credit Support Document fail to extend (without the consent of the other party) to the performance by suchresulting, surviving or transferee entity of its obligations under this Agreement.
(b) Termination Events. The occurrence atany 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 (subject to Section 5(c)) an Illegality if the event is specified inclause (i) below, a Force Majeure Event if the event is specified in clause (ii) below, a Tax Event if the event is specified in clause (iii) below, a Tax Event Upon Merger if the event is specified in clause (iv) below, and, ifspecified to be applicable, a Credit Event Upon Merger if the event is specified pursuant to clause (v) below or an Additional Termination Event if the event is specified pursuant to clause (vi) below:—
(i) Illegality. After giving effect to any applicable provision, disruption fallback or remedy specified in, or pursuant to,the relevant Confirmation or elsewhere in this Agreement, due to an event or circumstance (other than any action taken by a party or, if applicable, any Credit Support Provider of such party) occurring after a Transaction is entered into, it becomesunlawful under any applicable law (including without limitation the laws of any country in which payment, delivery or compliance is required by either party or any Credit Support Provider, as the case may be), on any day, or it would be unlawful ifthe relevant payment, delivery or compliance were required on that day (in each case, other than as a result of a breach by the party of Section 4(b)):—
(2) for such party or any Credit Support Provider of such party (which will be the Affected Party) to perform any absolute or contingentobligation to make a payment or delivery which such party or Credit Support Provider has under any Credit Support Document relating to such Transaction, to receive a payment or delivery under such Credit Support Document or to comply with any othermaterial provision of such Credit Support Document;
(ii) Force Majeure Event. After giving effect to anyapplicable provision, disruption fallback or remedy specified in, or pursuant to, the relevant Confirmation or elsewhere in this Agreement, by reason of force majeure or act of state occurring after a Transaction is entered into, on any day:—
(1) the Office through which such party (which will be the Affected Party) makes and receives payments or deliveries withrespect to such Transaction is prevented from performing any absolute or contingent obligation to make a payment or delivery in respect of such Transaction, from receiving a payment or delivery in respect of such Transaction or from complying withany other material provision of this Agreement relating to such Transaction (or would be so prevented if such payment, delivery or compliance were required on that day), or it becomes impossible or
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impracticable for such Office so to perform, receive or comply (or it would be impossible or impracticable for such Office so to perform, receive or comply if such payment, delivery or compliancewere required on that day); or
(2) such party or any Credit Support Provider of such party (which will be the Affected Party)is prevented from performing any absolute or contingent obligation to make a payment or delivery which such party or Credit Support Provider has under any Credit Support Document relating to such Transaction, from receiving a payment or deliveryunder such Credit Support Document or from complying with any other material provision of such Credit Support Document (or would be so prevented if such payment, delivery or compliance were required on that day), or it becomes impossible orimpracticable for such party or Credit Support Provider so to perform, receive or comply (or it would be impossible or impracticable for such party or Credit Support Provider so to perform, receive or comply if such payment, delivery or compliancewere required on that day),
so long as the force majeure or act of state is beyond the control of such Office, such party orsuch Credit Support Provider, as appropriate, and such Office, party or Credit Support Provider could not, after using all reasonable efforts (which will not require such party or Credit Support Provider to incur a loss, other than immaterial,incidental expenses), overcome such prevention, impossibility or impracticability;
(iii) Tax Event. Due to(1) any action taken by a taxing authority, or brought in a court of competent jurisdiction, after a Transaction is entered into (regardless of whether such action is taken or brought with respect to a party to this Agreement) or (2) aChange 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 Settlement Date (A) be required to pay to the other party an additional amount in respectof an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest under Section 9(h)) or (B) receive a payment from which an amount is required to be deducted or withheld for or on account of a Tax (except in respect ofinterest under Section 9(h)) 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));
(iv) Tax Event Upon Merger. The party (the “Burdened Party”) on the next succeeding Scheduled Settlement Date willeither (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 9(h)) or (2) receive a payment from which an amount has been deducted orwithheld for or on account of any 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 amalgamatingwith, or merging with or into, or transferring all or substantially all its assets (or any substantial part of the assets comprising the business conducted by it as of the date of this Master Agreement) to, or reorganising, reincorporating orreconstituting into or as, another entity (which will be the Affected Party) where such action does not constitute a Merger Without Assumption;
(1) X consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets (or any substantial partof the assets comprising the business conducted by X as of the date of this Master Agreement) to, or reorganises, reincorporates or reconstitutes into or as, another entity;
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(2) any person, related group of persons or entity acquires directly or indirectly thebeneficial ownership of (A) equity securities having the power to elect a majority of the board of directors (or its equivalent) of X or (B) any other ownership interest enabling it to exercise control of X; or
(3) X effects any substantial change in its capital structure by means of the issuance, incurrence or guarantee of debt or the issuance of(A) preferred stock or other securities convertible into or exchangeable for debt or preferred stock or (B) in the case of entities other than corporations, any other form of ownership interest; or
(vi) Additional Termination Event. If any “Additional Termination Event” is specified in the Schedule or anyConfirmation as applying, the occurrence of such event (and, in such event, the Affected Party or Affected Parties will be as specified for such Additional Termination Event in the Schedule or such Confirmation).
(c) Hierarchy of Events.
(iii) If an event or circumstance which would otherwise constitute or give rise to a Force Majeure Event
also constitutes an Illegality, it will be treated as an Illegality, except as described in clause (ii) above, and not a ForceMajeure Event.
(d) Deferral of Payments and Deliveries During Waiting Period. If an Illegality or a Force Majeure Event hasoccurred and is continuing with respect to a Transaction, each payment or delivery which would otherwise be required to be made under that Transaction will be deferred to, and will not be due until:—
(i) the first Local Business Day or, in the case of a delivery, the first Local Delivery Day (or the first day that would have been aLocal Business Day or Local Delivery Day, as appropriate, but for the occurrence of the event or circumstance constituting or giving rise to that Illegality or Force Majeure Event) following the end of any applicable Waiting Period in respect ofthat Illegality or Force Majeure Event, as the case may be; or
(ii) if earlier, the date on which the event or circumstanceconstituting or giving rise to that Illegality or Force Majeure Event ceases to exist or, if such date is not a Local Business Day or, in the case of a delivery, a Local Delivery Day, the first following day that is a Local Business Day or LocalDelivery Day, as appropriate.
(e) Inability of Head or Home Office to Perform Obligations of Branch. If (i) an Illegalityor a Force Majeure Event occurs under Section 5(b)(i)(1) or 5(b)(ii)(1) and the relevant Office is not the Affected Party’s head or home office, (ii) Section 10(a) applies, (iii) the other party seeks performance of therelevant obligation or
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compliance with the relevant provision by the Affected Party’s head or home office and (iv) the Affected Party’s head or home office fails so to perform or comply due to theoccurrence of an event or circumstance which would, if that head or home office were the Office through which the Affected Party makes and receives payments and deliveries with respect to the relevant Transaction, constitute or give rise to anIllegality or a Force Majeure Event, and such failure would otherwise constitute an Event of Default under Section 5(a)(i)or 5(a)(iii)(1) with respect to such party, then, for so long as the relevant event or circumstance continues to existwith respect to both the Office referred to in Section 5(b)(i)(1) or 5(b)(ii)(1), as the case may be, and the Affected Party’s head or home office, such failure will not constitute an Event of Default under Section 5(a)(i) or5(a)(iii)(1).
| 6. | Early Termination; Close-Out Netting |
(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 ofan 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 petitionupon 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).
(i)Notice. If a Termination Event other than a Force Majeure Event occurs, an Affected Party will,
promptly uponbecoming aware of it, notify the other party, specifying the nature of that Termination Event and each Affected Transaction, and will also give the other party such other information about that Termination Event as the other party may reasonablyrequire. If a Force Majeure Event occurs, each party will, promptly upon becoming aware of it, use all reasonable efforts to notify the other party, specifying the nature of that Force Majeure Event, and will also give the other party such otherinformation about that Force Majeure Event as the other party may reasonably require.
(ii) Transfer to Avoid TerminationEvent. If 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 Dateunder Section 6(b)(iv), use all reasonable efforts (which will not require such party to incur a loss, other than immaterial, incidental expenses) to transfer within 20 days after it gives notice under Section 6(b)(i) all its rights andobligations under this Agreement in respect of the Affected Transactions to another of its Offices or Affiliates so that such Termination Event ceases to exist.
Any such transfer by a party under this Section 6(b)(ii) willbe 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 theterms proposed.
(iii) Two Affected Parties. If a Tax Event occurs and there are two Affected Parties, each partywill use all reasonable efforts to reach agreement within 30 days after notice of such occurrence is given under Section 6(b)(i) to avoid that Termination Event.
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(iv) Right to Terminate.
(1) If:—
(A) a transfer under Section 6(b)(ii) or an agreement under Section 6(b)(iii), as the case may be, has not been effected withrespect to all Affected Transactions within 30 days after an Affected Party gives notice under Section 6(b)(i); or
(B) aCredit 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,
(2) If at any timean Illegality or a Force Majeure Event has occurred and is then continuing and any applicable Waiting Period has expired:—
(A) Subject to clause (B) below, either party may, by not more than 20 days notice to the other party, designate (I) a day notearlier than the day on which such notice becomes effective as an Early Termination Date in respect of all Affected Transactions or (II) by specifying in that notice the Affected Transactions in respect of which it is designating the relevant day asan Early Termination Date, a day not earlier than two Local Business Days following the day on which such notice becomes effective as an Early Termination Date in respect of less than all Affected Transactions. Upon receipt of a notice designatingan Early Termination Date in respect of less than all Affected Transactions, the other party may, by notice to the designating party, if such notice is effective on or before the day so designated, designate that same day as an Early TerminationDate in respect of any or all other Affected Transactions.
(B) An Affected Party (if the Illegality or Force Majeure Eventrelates to performance by such party or any Credit Support Provider of such party of an obligation to make any payment or delivery under, or to compliance with any other material provision of, the relevant Credit Support Document) will only have theright to designate an Early Termination Date under Section 6(b)(iv)(2)(A) as a result of an Illegality under Section 5(b)(i)(2) or a Force Majeure Event under Section 5(b)(ii)(2) following the prior designation by the other party ofan Early Termination Date, pursuant to Section 6(b)(iv)(2)(A), in respect of less than all Affected Transactions.
(c) Effect ofDesignation.
(i) If notice designating an Early Termination Date is given under Section 6(a) or 6(b), the Early
Termination Date will occur on the date so designated, whether or not the relevant Event of Default or Termination Event isthen continuing.
(ii) Upon the occurrence or effective designation of an Early Termination Date, no further payments or
deliveries under Section 2(a)(i) or 9(h)(i) in respect of the Terminated Transactions will be required to be made, butwithout prejudice to the other provisions of this Agreement. The amount, if any, payable in respect of an Early Termination Date will be determined pursuant to Sections 6(e) and 9(h)(ii).
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(d) Calculations; Payment Date.
(i) Statement. On or as soon as reasonably practicable following the occurrence of an Early Termination Date, each partywill 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 any quotations, market data or information frominternal sources used in making such calculations), (2) specifying (except where there are two Affected Parties) any Early Termination Amount payable and (3) giving details of the relevant account to which any amount payable to it is to bepaid. In the absence of written confirmation from the source of a quotation or market data obtained in determining a Close-out Amount, the records of the party obtaining such quotation or market data will be conclusive evidence of the existence andaccuracy of such quotation or market data.
(ii) Payment Date. An Early Termination Amount due in respect of anyEarly Termination Date will, together with any amount of interest payable pursuant to Section 9(h)(ii)(2), be payable (1) on the day on which notice of the amount payable is effective in the case of an Early Termination Date which isdesignated or occurs as a result of an Event of Default and (2) on the day which is two Local Business Days after the day on which notice of the amount payable is effective (or, if there are two Affected Parties, after the day on which thestatement provided pursuant to clause (i) above by the second party to provide such a statement is effective) in the case of an Early Termination Date which is designated as a result of a Termination Event.
(e) Payments on Early Termination. If an Early Termination Date occurs, the amount, if any, payable in respect of that Early TerminationDate (the “Early Termination Amount”) will be determined pursuant to this Section 6(e) and will be subject to Section 6(f).
(ii) Termination Events. If the Early Termination Date results from a Termination Event:—
(1) One Affected Party. Subject to clause (3) below, if there is one Affected Party, the Early Termination Amount will bedetermined in accordance with Section 6(e)(i), except that references to the Defaulting Party and to the Non-defaulting Party will be deemed to be references to the Affected Party and to the Non-affected Party, respectively.
(2) Two Affected Parties. Subject to clause (3) below, if there are two Affected Parties, each party will determine an amountequal to the Termination Currency Equivalent of the sum of the Close-out Amount or Close-out Amounts (whether positive or negative) for each Terminated Transaction or group of Terminated Transactions, as the case may be, and the Early TerminationAmount will be an amount equal to (A) the sum of (I) one-half of the difference between the higher amount so determined (by party “X”) and the lower amount so determined (by party “Y”) and (II) the Termination CurrencyEquivalent of the Unpaid Amounts owing to X less (B) the Termination Currency Equivalent of the Unpaid Amounts owing to Y. If the Early Termination Amount is a positive number, Y will pay it to X; if it is a negative number, X will pay theabsolute value of the Early Termination Amount to Y.
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(3) Mid-Market Events. If that Termination Event is an Illegality or a Force MajeureEvent, then the Early Termination Amount will be determined in accordance with clause (1) or (2) above, as appropriate, except that, for the purpose of determining a Close-out Amount or Close-out Amounts, the Determining Party will:—
(A) if obtaining quotations from one or more third parties (or from any of the Determining Party’s Affiliates), ask eachthird party or Affiliate (I) not to take account of the current creditworthiness of the Determining Party or any existing Credit Support Document and (II) to provide mid-market quotations; and
(B) in any other case, use mid-market values without regard to the creditworthiness of the Determining Party.
(iii) Adjustment for Bankruptcy. In circumstances where an Early Termination Date occurs because Automatic Early Terminationapplies in respect of a party, the Early Termination Amount will be subject to such adjustments as are appropriate and permitted by applicable law to reflect any payments or deliveries made by one party to the other under this Agreement (andretained by such other party) during the period from the relevant Early Termination Date to the date for payment determined under Section 6(d)(ii).
(v) Pre-Estimate. The parties agree that an amount recoverable under this Section 6(e) is a reasonable pre-estimate ofloss 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 aconsequence of the termination of the Terminated Transactions.
(f) Set-Off. Any Early Termination Amount payable to one party(the “Payee”) by the other party (the “Payer”), in circumstances where there is a Defaulting Party or where there is one Affected Party in the case where either a Credit Event Upon Merger has occurred or any other TerminationEvent in respect of which all outstanding Transactions are Affected Transactions has occurred, will, at the option of the Non-defaulting Party or the Non-affected Party, as the case may be (“X”) (and without prior notice to the DefaultingParty or the Affected Party, as the case may be), be reduced by its set-off against any other amounts (“Other Amounts”) payable by the Payee to the Payer (whether or not arising under this Agreement, matured or contingent and irrespectiveof the currency, place of payment or place of booking of the obligation). To the extent that any Other Amounts are so set off, those Other Amounts will be discharged promptly and in all respects. X will give notice to the other party of any set-offeffected under this Section 6(f).
For this purpose, either the Early Termination Amount or the Other Amounts (or the relevant portion ofsuch amounts) may be converted by X into the currency in which the other is denominated at the rate of exchange at which such party would be able, in good faith and using commercially reasonable procedures, to purchase the relevant amount of suchcurrency.
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If an obligation is unascertained, X may in good faith estimate that obligation and set off in respect ofthe estimate, subject to the relevant party accounting to the other when the obligation is ascertained.
Nothing in this Section 6(f)will be effective to create a charge or other security interest. This Section 6(f) will be without prejudice and in addition to any right of set-off, offset, combination of accounts, lien, right of retention or withholding or similar right orrequirement to which any party is at any time otherwise entitled or subject (whether by operation of law, contract or otherwise).
| 7. | Transfer |
Subject toSection 6(b)(ii) and to the extent permitted by applicable law, 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 priorwritten consent of the other party, except that:—
(a) a party may make such a transfer of this Agreement pursuant to a consolidation oramalgamation 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
Any purported transfer that is not incompliance with this Section 7 will be void.
| 8. | Contractual Currency |
(a) Paymentin 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, anyobligation 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 theparty to which payment is owed, acting in good faith and using commercially reasonable procedures in converting the currency so tendered into the Contractual Currency, of the full amount in the Contractual Currency of all amounts payable in respectof 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 permittedby 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 ContractualCurrency 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 clause (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 ContractualCurrency 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 ifsuch 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 purpose of such judgment or order and the rate ofexchange at which such party is able, acting in good faith and using commercially reasonable procedures in converting the currency received into the Contractual Currency, to purchase the Contractual Currency with the amount of the currency of thejudgment or order actually received by such party.
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(c) Separate Indemnities. To the extent permitted by applicable law, the indemnities in thisSection 8 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 whichany 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.
| 9. | Miscellaneous |
(a) EntireAgreement. This Agreement constitutes the entire agreement and understanding of the parties with respect to its subject matter. Each of the parties acknowledges that in entering into this Agreement it has not relied on any oral or writtenrepresentation, warranty or other assurance (except as provided for or referred to in this Agreement) and waives all rights and remedies which might otherwise be available to it in respect thereof, except that nothing in this Agreement will limit orexclude any liability of a party for fraud.
(b) Amendments. An amendment, modification or waiver in respect of this Agreementwill only be effective if 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 by an exchange of 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 thisAgreement will survive the termination of any Transaction.
(d) Remedies Cumulative. Except as provided in this Agreement, therights, powers, remedies and privileges provided in this Agreement are cumulative and not exclusive of any rights, powers, remedies and privileges provided by law.
(i) This Agreement (and eachamendment, modification and waiver in respect of it) may be executed
and delivered in counterparts (including by facsimiletransmission and by electronic messaging system), each of which will be deemed an original.
(ii) The parties intend that theyare legally bound by the terms of each Transaction from the moment they agree to those terms (whether orally or otherwise). A Confirmation will be entered into as soon as practicable and may be executed and delivered in counterparts (including byfacsimile transmission) or be created by an exchange of telexes, by an exchange of electronic messages on an electronic messaging system or by an exchange of e-mails, which in each case will be sufficient for all purposes to evidence a bindingsupplement to this Agreement. The parties will specify therein or through another effective means that any such counterpart, telex, electronic message or e-mail constitutes a Confirmation.
(g) Headings. The headings used in this Agreement are for convenience of reference only and are not to affect the construction of or to betaken into consideration in interpreting this Agreement.
Isda 2005 Commodity Definitions Pdf
| 16 | ISDA® 2002 |
(h) Interest and Compensation.
(i) Prior to Early Termination. Prior to the occurrence or effective designation of an Early Termination Date in respect of the relevantTransaction:—
(1) Interest on Defaulted Payments. If a party defaults in the performance of any paymentobligation, it will, to the extent permitted by applicable law and subject to Section 6(c), pay interest (before as well as after judgment) on the overdue amount to the other party on demand in the same currency as the overdue amount, for theperiod from (and including) the original due date for payment to (but excluding) the date of actual payment (and excluding any period in respect of which interest or compensation in respect of the overdue amount is due pursuant to clause(3)(B) or (C) below), at the Default Rate.
(2) Compensation for Defaulted Deliveries. If aparty defaults in the performance of any obligation required to be settled by delivery, it will on demand (A) compensate the other party to the extent provided for in the relevant Confirmation or elsewhere in this Agreement and (B) unlessotherwise provided in the relevant Confirmation or elsewhere in this Agreement, to the extent permitted by applicable law and subject to Section 6(c), pay to the other party interest (before as well as after judgment) on an amount equal to thefair market value of that which was required to be delivered in the same currency as that amount, for the period from (and including) the originally scheduled date for delivery to (but excluding) the date of actual delivery (and excluding any periodin respect of which interest or compensation in respect of that amount is due pursuant to clause (4) below), at the Default Rate. The fair market value of any obligation referred to above will be determined as of the originally scheduled datefor delivery, in good faith and using commercially reasonable procedures, by the party that was entitled to take delivery.
(3)Interest on Deferred Payments. If:—
(A) a party does not pay any amount that, but for Section 2(a)(iii),would have been payable, it will, to the extent permitted by applicable law and subject to Section 6(c) and clauses (B) and (C) below, pay interest (before as well as after judgment) on that amount to the other party on demand (aftersuch amount becomes payable) in the same currency as that amount, for the period from (and including) the date the amount would, but for Section 2(a)(iii), have been payable to (but excluding) the date the amount actually becomes payable, atthe Applicable Deferral Rate;
(B) a payment is deferred pursuant to Section 5(d), the party which would otherwise havebeen required to make that payment will, to the extent permitted by applicable law, subject to Section 6(c) and for so long as no Event of Default or Potential Event of Default with respect to that party has occurred and is continuing, payinterest (before as well as after judgment) on the amount of the deferred payment to the other party on demand (after such amount becomes payable) in the same currency as the deferred payment, for the period from (and including) the date the amountwould, but for Section 5(d), have been payable to (but excluding) the earlier of the date the payment is no longer deferred pursuant to Section 5(d) and the date during the deferral period upon which an Event of Default or Potential Eventof Default with respect to that party occurs, at the Applicable Deferral Rate; or
(C) a party fails to make any payment dueto the occurrence of an Illegality or a Force Majeure Event (after giving effect to any deferral period contemplated by clause (B) above), it will, to the extent permitted by applicable law, subject to Section 6(c) and for so long as the eventor circumstance giving rise to that Illegality or Force Majeure Event
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continues and no Event of Default or Potential Event of Default with respect to that party has occurred and is continuing, pay interest (before as well as after judgment) on the overdue amount tothe other party on demand in the same currency as the overdue amount, for the period from (and including) the date the party fails to make the payment due to the occurrence of the relevant Illegality or Force Majeure Event (or, if later, the datethe payment is no longer deferred pursuant to Section 5(d)) to (but excluding) the earlier of the date the event or circumstance giving rise to that Illegality or Force Majeure Event ceases to exist and the date during the period upon which anEvent of Default or Potential Event of Default with respect to that party occurs (and excluding any period in respect of which interest or compensation in respect of the overdue amount is due pursuant to clause (B) above), at the ApplicableDeferral Rate.
(4) Compensation for Deferred Deliveries. If:—
(A) a party does not perform any obligation that, but for Section 2(a)(iii), would have been required to be settled by delivery;
(B) a delivery is deferred pursuant to Section 5(d); or
(C) a party fails to make a delivery due to the occurrence of an Illegality or a Force Majeure Event at a time when any applicableWaiting Period has expired,
the party required (or that would otherwise have been required) to make the delivery will, to theextent permitted by applicable law and subject to Section 6(c), compensate and pay interest to the other party on demand (after, in the case of clauses (A) and (B) above, such delivery is required) if and to the extent provided for inthe relevant Confirmation or elsewhere in this Agreement.
(ii) Early Termination. Upon the occurrence oreffective designation of an Early Termination Date in respect of a Transaction:—
(1) Unpaid Amounts. For thepurpose of determining an Unpaid Amount in respect of the relevant Transaction, and to the extent permitted by applicable law, interest will accrue on the amount of any payment obligation or the amount equal to the fair market value of anyobligation required to be settled by delivery included in such determination in the same currency as that amount, for the period from (and including) the date the relevant obligation was (or would have been but for Section 2(a)(iii) or 5(d))required to have been performed to (but excluding) the relevant Early Termination Date, at the Applicable Close-out Rate.
(2)Interest on Early Termination Amounts. If an Early Termination Amount is due in respect of such Early Termination Date, that amount will, to the extent permitted by applicable law, be paid together with interest (before as well as afterjudgment) on that amount in the Termination Currency, for the period from (and including) such Early Termination Date to (but excluding) the date the amount is paid, at the Applicable Close-out Rate.
(iii) Interest Calculation. Any interest pursuant to this Section 9(h) will be calculated on the basis of dailycompounding and the actual number of days elapsed.
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| 10. | Offices; Multibranch Parties |
(a) IfSection 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 and agrees with the other party that, notwithstanding the place of booking orits jurisdiction of incorporation or organisation, its obligations are the same in terms of recourse against it as if it had entered into the Transaction through its head or home office, except that a party will not have recourse to the head or homeoffice of the other party in respect of any payment or delivery deferred pursuant to Section 5(d) for so long as the payment or delivery is so deferred. This representation and agreement will be deemed to be repeated by each party on each dateon which the parties enter into a Transaction.
(b) If a party is specified as a Multibranch Party in the Schedule, such party may, subject toclause (c) below, enter into a Transaction through, book a Transaction in and make and receive payments and deliveries with respect to a Transaction through any Office listed in respect of that party in the Schedule (but not any other Officeunless otherwise agreed by the parties in writing).
(c) The Office through which a party enters into a Transaction will be the Officespecified for that party in the relevant Confirmation or as otherwise agreed by the parties in writing, and, if an Office for that party is not specified in the Confirmation or otherwise agreed by the parties in writing, its head or home office.Unless the parties otherwise agree in writing, the Office through which a party enters into a Transaction will also be the Office in which it books the Transaction and the Office through which it makes and receives payments and deliveries withrespect to the Transaction. Subject to Section 6(b)(ii), neither party may change the Office in which it books the Transaction or the Office through which it makes and receives payments or deliveries with respect to a Transaction without theprior written consent of the other party.
| 11. | Expenses |
A Defaulting Party will ondemand indemnify and hold harmless the other party for and against all reasonable out-of-pocket expenses, including legal fees, execution fees and Stamp Tax, incurred by such other party by reason of the enforcement and protection of its rightsunder 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 described below (except that a notice or other communication under Section 5 or 6 may not be given by electronic messaging system or e-mail) tothe address or number or in accordance with the electronic messaging system or e-mail details provided (see the Schedule) and will be deemed effective as indicated:—
(iii) if sent by facsimile transmission, on the date it is received by a responsible employee of the recipient in legible form (it beingagreed 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);
(v) if sent by electronic messaging system, on the date it is received; or
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(vi) if sent by e-mail, on the date it is delivered,
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 will be deemed given and effective on the first following day that is a Local Business Day.
(b) Change of Details. Either party may by notice to the other change the address, telex or facsimile number or electronic messaging systemor e-mail 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 any dispute arising out of or in connection with this Agreement (“Proceedings”), each party irrevocably:—
(i) submits:—
(2) if this Agreement is expressed to be governed by the laws of the State of New York, to
the non-exclusive jurisdiction of the courts of the State of New York and the United States District Court located in the Borough ofManhattan in New York City;
(ii) waives any objection which it may have at any time to the laying of venue of any Proceedingsbrought 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;and
(iii) agrees, to the extent permitted by applicable law, that the bringing of Proceedings in any one or more jurisdictionswill not preclude the bringing of Proceedings in any other jurisdiction.
(c) Service of Process. Each party irrevocablyappoints 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 willpromptly 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(a)(i), 12(a)(iii)or 12(a)(iv). Nothing in this Agreement will affect the right of either party to serve process in any other manner permitted by applicable law.
(d) Waiver of Immunities. Each party irrevocably waives, to the extent permitted by applicable law, with respect to itself and its revenuesand 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 or order for specificperformance or 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 inthe 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.
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| 14. | Definitions |
As used in thisAgreement:—
“Additional Representation” has the meaning specified in Section 3.
“Additional Termination Event” has the meaning specified in Section 5(b).
“Affected Party” has the meaning specified in Section 5(b).
“Affiliate” means, subject to the Schedule, in relation to any person, any entity controlled, directlyor 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 amajority of the voting power of the entity or person.
“Agreement” has the meaning specified in Section 1(c).
“Applicable Close-out Rate” means:—
| (a) | in respect of the determination of an Unpaid Amount:— |
(ii) in respect of obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Non-defaulting Party,the Non-default Rate;
(iii) in respect of obligations deferred pursuant to Section 5(d), if there is no Defaulting Partyand for so long as the deferral period continues, the Applicable Deferral Rate; and
(iv) in all other cases following theoccurrence of a Termination Event (except where interest accrues pursuant to clause (iii) above), the Applicable Deferral Rate; and
| (b) | in respect of an Early Termination Amount:— |
(1) if the Early Termination Amount is payable by a Defaulting Party, the Default Rate;
(2) if the Early Termination Amount is payable by a Non-defaulting Party, the Non-default Rate; and
(3) in all other cases, the Applicable Deferral Rate; and
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(ii) for the period from (and including) the date (determined in accordance withSection 6(d)(ii)) on which that amount is payable to (but excluding) the date of actual payment:—
(1) if a partyfails to pay the Early Termination Amount due to the occurrence of an event or circumstance which would, if it occurred with respect to a payment or delivery under a Transaction, constitute or give rise to an Illegality or a Force Majeure Event, andfor so long as the Early Termination Amount remains unpaid due to the continuing existence of such event or circumstance, the Applicable Deferral Rate;
(3) if the Early Termination Amount is payable by a Non-defaulting Party (but excluding any period in respect of which clause(1) above applies), the Non-default Rate; and
(4) in all other cases, the Termination Rate.
“Applicable Deferral Rate” means:—
(b) for purposes of Section 9(h)(i)(3)(B) and clause (a)(iii) of the definition of Applicable Close-out Rate, the rate certified by the relevantpayer to be a rate offered to prime banks by a major bank in a relevant interbank market for overnight deposits in the applicable currency, such bank to be selected in good faith by the payer after consultation with the other party, if practicable,for the purpose of obtaining a representative rate that will reasonably reflect conditions prevailing at the time in that relevant market; and
(c) for purposes of Section 9(h)(i)(3)(C) and clauses (a)(iv), (b)(i)(3) and (b)(ii)(1) of the definition of Applicable Close-out Rate, a rate equalto the arithmetic mean of the rate determined pursuant to clause (a) above and 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 therelevant amount.
“Automatic Early Termination” has the meaning specified in Section 6(a).
“Burdened Party” has the meaning specified in Section 5(b)(iv).
“Close-out Amount” means, with respect toeach Terminated Transaction or each group of Terminated Transactions and a Determining Party, the amount of the losses or costs of the Determining Party that are or would be incurred under then prevailing circumstances (expressed as a positivenumber) or gains of the Determining Party that are or would be realised under then prevailing circumstances (expressed as a negative number) in replacing, or in providing for the Determining Party the economic equivalent of, (a) the materialterms of that Terminated Transaction or group of Terminated Transactions, including the payments and deliveries by the parties under Section 2(a)(i) in respect of that Terminated Transaction or group of Terminated Transactions that would, butfor the occurrence of the relevant Early Termination Date, have been required after that date (assuming satisfaction of the conditions precedent in Section 2(a)(iii)) and (b) the option rights of the parties in respect of that TerminatedTransaction or group of Terminated Transactions.
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Any Close-out Amount will be determined by the Determining Party (or its agent), which will act in goodfaith and use commercially reasonable procedures in order to produce a commercially reasonable result. The Determining Party may determine a Close-out Amount for any group of Terminated Transactions or any individual Terminated Transaction but, inthe aggregate, for not less than all Terminated Transactions. Each Close-out Amount will be determined as of the Early Termination Date or, if that would not be commercially reasonable, as of the date or dates following the Early Termination Date aswould be commercially reasonable.
Unpaid Amounts in respect of a Terminated Transaction or group of Terminated Transactions and legal feesand out-of-pocket expenses referred to in Section 11 are to be excluded in all determinations of Close-out Amounts.
In determining aClose-out Amount, the Determining Party may consider any relevant information, including, without limitation, one or more of the following types of information: —
(iii) information of the types described in clause (i) or(ii) above from internal sources (including any of the Determining Party’s Affiliates) if that information is of the same type used by the Determining Party in the regular course of its business for the valuation of similar transactions.
The Determining Party will consider, taking into account the standards and procedures described in this definition, quotations pursuant toclause (i) above or relevant market data pursuant to clause (ii) above unless the Determining Party reasonably believes in good faith that such quotations or relevant market data are not readily available or would produce a result thatwould not satisfy those standards. When considering information described in clause (i), (ii) or (iii) above, the Determining Party may include costs of funding, to the extent costs of funding are not and would not be a component of theother information being utilised. Third parties supplying quotations pursuant to clause (i) above or market data pursuant to clause (ii) above may include, without limitation, dealers in the relevant markets, end-users of the relevantproduct, information vendors, brokers and other sources of market information.
Without duplication of amounts calculated based on informationdescribed in clause (i), (ii) or (iii) above, or other relevant information, and when it is commercially reasonable to do so, the Determining Party may in addition consider in calculating a Close-out Amount any loss or cost incurred inconnection with its terminating, liquidating or re-establishing any hedge related to a Terminated Transaction or group of Terminated Transactions (or any gain resulting from any of them).
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(2) application of different valuation methods to Terminated Transactions or groups of TerminatedTransactions depending on the type, complexity, size or number of the Terminated Transactions or group of Terminated Transactions.
“Confirmation” has the meaning specified in the preamble.
“Contractual Currency” has the meaning specified in Section 8(a).
“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 (ascertified by it) if it were to fund or of funding the relevant amount plus 1% per annum.
“Defaulting Party” hasthe meaning specified in Section 6(a).
“Designated Event” has the meaning specified in Section 5(b)(v).
“Determining Party” means the party determining a Close-out Amount.
“Early Termination Amount” has the meaning specified in Section 6(e).
“Early Termination Date” means the date determined in accordance with Section 6(a) or 6(b)(iv).
“electronic messages” does not include e-mails but does include documents expressed in markup languages, and“electronic messaging system” will be construed accordingly.
“English law” means the law ofEngland and Wales, and “English” will be construed accordingly.
“Event of Default” has themeaning specified in Section 5(a) and, if applicable, in the Schedule.
“Force Majeure Event” has the meaningspecified in Section 5(b).
“General Business Day” means a day on which commercial banks are open for generalbusiness (including dealings in foreign exchange and foreign currency deposits).
“Illegality” has the meaningspecified in Section 5(b).
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“Indemnifiable Tax” means any Tax other than a Tax that would not be imposed inrespect 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, orhaving 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 apayment under, or enforced, this Agreement or a Credit Support Document).
“law” includes any treaty, law, rule orregulation (as modified, in the case of tax matters, by the practice of any relevant governmental revenue authority), and “unlawful” will be construed accordingly.
“Local Delivery Day” means, for purposes of Sections 5(a)(i) and 5(d), a day on which settlement systems necessary toaccomplish the relevant delivery are generally open for business so that the delivery is capable of being accomplished in accordance with customary market practice, in the place specified in the relevant Confirmation or, if not so specified, in alocation as determined in accordance with customary market practice for the relevant delivery.
“Master Agreement” hasthe meaning specified in the preamble.
“Merger Without Assumption” means the event specified inSection 5(a)(viii).
“Multiple Transaction Payment Netting” has the meaning specified in Section 2(c).
“Non-affected Party” means, so long as there is only one Affected Party, the other party.
“Non-default Rate” means the rate certified by the Non-defaulting Party to be a rate offered to the Non-defaulting Party by amajor bank in a relevant interbank market for overnight deposits in the applicable currency, such bank to be selected in good faith by the Non-defaulting Party for the purpose of obtaining a representative rate that will reasonably reflectconditions prevailing at the time in that relevant market.
“Non-defaulting Party” has the meaning specified inSection 6(a).
“Office” means a branch or office of a party, which may be such party’s heador home office.
“Other Amounts” has the meaning specified in Section 6(f).
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“Payee” has the meaning specified in Section 6(f).
“Payer” has the meaning specified in Section 6(f).
“Proceedings” has the meaning specified in Section 13(b).
“rate of exchange” includes, without limitation, any premiums and costs of exchange payable in connection with the purchase of orconversion into the Contractual Currency.
“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 executesthis Agreement and (d) in relation to any payment, from or through which such payment is made.
“Schedule” hasthe meaning specified in the preamble.
“Scheduled Settlement Date” means a date on which a payment or delivery is tobe made under Section 2(a)(i) with respect to a Transaction.
“Specified Entity” has the meaning specified in theSchedule.
“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 to any such transaction) now existing or hereafter entered into between one party to this Agreement (or any Credit Support Provider of such partyor 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 not a Transaction under this Agreement but(i) which is a rate swap transaction, swap option, 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 exchangetransaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option, credit protection transaction, credit swap, credit default swap, credit default option, totalreturn swap, credit spread transaction, repurchase transaction, reverse repurchase transaction, buy/sell-back transaction, securities lending transaction, weather index transaction or forward purchase or sale of a security, commodity or otherfinancial instrument or interest (including any option with respect to any of these transactions) or (ii) which is a type of transaction that is similar to any transaction referred to in clause (i) above that is currently, or in the futurebecomes, recurrently entered into in the financial markets (including terms and conditions incorporated by reference in such agreement) and which is a forward, swap, future, option or other derivative on one or more rates, currencies, commodities,equity securities or other equity instruments, debt securities or other debt instruments, economic indices or measures of economic risk or value, or other benchmarks against which payments or deliveries are to be made, (b) any combination ofthese 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.
“Stamp Tax Jurisdiction” has the meaning specified in Section 4(e).
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“Tax” means any present or future tax, levy, impost, duty, charge, assessment or feeof 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).
“Terminated Transactions” means, with respect to any Early Termination Date, (a) if resulting from an Illegality or a ForceMajeure Event, all Affected Transactions specified in the notice given pursuant to Section 6(b)(iv), (b) if resulting from any other Termination Event, all Affected Transactions and (c) if resulting from an Event of Default, allTransactions in effect either 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” means (a) if a Termination Currency is specified in the Schedule and that currency is freelyavailable, that currency, and (b) otherwise, euro if this Agreement is expressed to be governed by English law or United States Dollars if this Agreement is expressed to be governed by the laws of the State of New York.
“Termination Currency Equivalent” means, in respect of any amount denominated in the Termination Currency, such TerminationCurrency 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 beingrequired to purchase such amount of such Other Currency as at the relevant Early Termination Date, or, if the relevant Close-out Amount is determined as of a later date, that later date, with the Termination Currency at the rate equal to the spotexchange 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 wouldbe 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 determinationunder Section 6(e), be selected in good faith by that party and otherwise will be agreed by the parties.
“TerminationEvent” means an Illegality, a Force Majeure Event, a Tax Event, 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.
“Threshold Amount” meansthe amount, if any, specified as such in the Schedule.
“Transaction” has the meaning specified in the preamble.
“Unpaid Amounts” owing to any party means, with respect to an Early Termination Date, the aggregate of (a) inrespect of all Terminated Transactions, the amounts that became payable (or that would have become payable but for Section 2(a)(iii) or due but for Section 5(d)) to such party under Section 2(a)(i) or 2(d)(i)(4) on or prior to suchEarly Termination Date and which remain unpaid as at such Early Termination Date, (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) or5(d)) 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 and (c) if the Early Termination Date results from an Event of Default, a Credit Event Upon Merger or an Additional Termination Event in respect of which all outstanding Transactions are Affected Transactions, any EarlyTermination Amount due prior to such Early Termination Date and which remains unpaid as of such Early Termination Date, in each case together with any amount of interest accrued or other
| 27 | ISDA® 2002 |
compensation in respect of that obligation or deferred obligation, as the case may be, pursuant to Section 9(h)(ii)(1) or (2), as appropriate. The fair market value of any obligationreferred to in clause (b) above will be determined as of the originally scheduled date for delivery, in good faith and using commercially reasonable procedures, by the party obliged to make the determination under Section 6(e) or, if eachparty is so obliged, it will be the average of the Termination Currency Equivalents of the fair market values so determined by both parties.
“Waiting Period” means:—
(b) in respect of an event or circumstance under Section 5(b)(ii), other than in the case of Section 5(b)(ii)(2)where the relevant payment, delivery or compliance is actually required on the relevant day (in which case no Waiting Period will apply), a period of eight Local Business Days (or days that would have been Local Business Days but for the occurrenceof that event or circumstance) following the occurrence of that event or circumstance.
IN WITNESS WHEREOF the parties have executed thisdocument on the respective dates specified below with effect from the date specified on the first page of this document.
Bank of America, N.A. | LKQ Corporation | ||||||||
| (Name of Party) | (Name of Party) | ||||||||
| By: | /s/ Roger H. Heintzelman | By: | /s/ John S. Quinn | ||||||
| Name: | Roger H. Heintzelman | Name: | John S. Quinn | ||||||
| Title: | Director | Title: | Executive Vice President and CFO | ||||||
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ISDA
SCHEDULE
to the
2002 Master Agreement
between
BANK OF AMERICA, N.A.,
under the laws of the UnitedStates of America,
(“Party A”)
LKQ CORPORATION,
a corporation organized and existing under the laws of Delaware,
Part 1
Termination Provisions
| (a) | “Specified Entity” means in relation to Party A for the purpose of Section 5(a)(v), any Affiliate of Party A, and for the purposes ofSections 5(a)(vi), 5(a)(vii) and 5(b)(v): none; |
“Specified Entity” means in relation toParty B for the purpose of Section 5(a)(v), any Affiliate of Party B, and for the purposes of Sections 5(a)(vi), 5(a)(vii) and 5(b)(v): none.
| (b) | “Specified Transaction” will have the meaning specified in Section 14 but shall also include any transaction with respect to margin loans,cash loans and short sales of any financial instrument, and as amended by inserting the words, “or any Affiliate of Party A” immediately after “Agreement” in the second line thereof. |
| (c) | The “Cross-Default” provisions of Section 5(a)(vi): |
will apply to Party B.
In connection therewith, “Specified Indebtedness” will not have the meaning specified in Section 14, and suchdefinition shall be replaced by the following: “any obligation in respect of the payment or repayment of moneys (whether present or future, contingent or otherwise, as principal or surety or otherwise), including, but without limitation, anyobligation in respect of borrowed money except that such term shall not include obligations in respect of deposits received in the ordinary course of a party’s banking business.”
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“Threshold Amount” means with respect to Party A an amount equal tothree percent (3%) of the Shareholders’ Equity of Bank of America Corporation and with respect to Party B, $50,000,000.
“Shareholders’ Equity” means with respect to an entity, at any time, the sum (as shown in the most recentannual audited financial statements of such entity) of (i) its capital stock (including preferred stock) outstanding, taken at par value, (ii) its capital surplus and (iii) its retained earnings, minus (iv) treasury stock, eachto be determined in accordance with generally accepted accounting principles.
| (d) | The “Credit Event Upon Merger” provisions of Section 5(b)(v): |
will apply to Party A
| (e) | The “Automatic Early Termination” provision of Section 6(a): |
will not apply to Party A
| (f) | “Termination Currency” means United States Dollars. |
| (g) | Additional Termination Event will apply. |
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Part 2
| (a) | Payer Tax Representations. For the purpose of Section 3(e) of this Agreement, Party A and Party B will make the following representation:- |
It is not required by any applicable law, as modified by the practice of any relevant governmental revenueauthority, 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 9(h) of this Agreement) to be made by it to the other party under this Agreement. Inmaking this representation, it may rely on (i) the accuracy of any representations 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) or4(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 containedin Section 4(d) of this Agreement, except that it will not be a breach of this representation where reliance is placed on clause (ii) above and the other party does not deliver a form or document under Section 4(a)(iii) by reason ofmaterial 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 will make the following representations specifiedbelow, if any:- |
| (i) | The following representations will apply to Party A: |
| (ii) | The following representations will apply to Party B: |
Part 3
Agreement to Deliver Documents
| (a) | Tax forms, documents or certificates to be delivered are: |
| Party required to deliver document | Document | Date by which to be delivered |
| Party B | Internal Revenue Service Form W-9 | Upon execution and delivery of this Agreement |
| (b) | Other documents to be delivered are:- |
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Party required todeliver document | Form/Document/Certificate | Date by which to be delivered | Covered by Section 3(d) Representation |
Party A and Party B | Certified copies of all corporate, partnership or membership authorizations, as the case may be, and any other documents with respect to the execution, delivery and performance ofthis Agreement and any Credit Support Document | Upon execution and delivery of this Agreement | Yes |
Party A and Party B | Certificate of authority and specimen signatures of individuals executing this Agreement and any Credit Support Document | Upon execution and delivery of this Agreement and thereafter upon request of the other party | Yes |
Party A | Annual Report of Bank of America Corporation containing audited, consolidated financial statements certified by independent certified public accountants and prepared in accordancewith generally accepted accounting principles in the country in which such party is organized | To be made available on www.bankofamerica.com/investor/ as soon as available and in any event within 90 days after the end of each fiscal year of Party A | Yes |
Party A | Quarterly Financial Statements of Bank of America Corporation containing unaudited, consolidated financial statements of such party’s fiscal quarter prepared in accordance withgenerally accepted accounting principles in the country in which such party is organized | To be made available on www.bankofamerica.com/investor/ as soon as available and in any event within 45 days after the end of each fiscal quarter of Party A | Yes |
Party B | Annual Report of Party B and of any Credit Support Provider thereof containing audited, consolidated financial statements certified by independent certified public accountants andprepared in accordance with generally accepted accounting principles in the country in which such party and such Credit Support Provider is organized | To be made available on www.lkqcorp.com as soon as available and in any event within 90 days after the end of each fiscal year of Party B and of the Credit SupportProvider | Yes |
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Party required todeliver document | Form/Document/Certificate | Date by which to be delivered | Covered by Section 3(d) Representation |
| Party B | Quarterly Financial Statements of Party B and any Credit Support Provider thereof containing unaudited, consolidated financial statements of such party’s fiscal quarterprepared in accordance with generally accepted accounting principles in the country in which such party and such Credit Support Provider is organized | To be made available on www.lkqcorp.com as soon as available and in any event within 45 days after the end of each fiscal quarter of Party B and of the Credit SupportProvider | Yes |
Part 4
Miscellaneous
| (a) | Address for Notices. For the purpose of Section 12(a) of this Agreement:- |
Address for notice or communications to Party A:
Willis Tower
233 South Wacker Drive, Suite 2800
Attention: Swap Operations
Telephone No.: (312) 234 2732
With a copy to:-
Bank of America, N.A.
New York, New York 10020
Attention: Client Integration and Documentation Group
Address for financial statements to Party A:
Bank of America, N.A.
Chicago, IL 60603
Attention: Megan Collins, Vice President
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Address for notice or communications to Party B:
LKQ Corporation
120 North LaSalle Street, Suite 3300
Attention: John Quinn
Telephone No.: 312-621-1950
Email Address: jsquinn@lkqcorp.com
With a copy to:
LKQ Corporation
676 N. Michigan Avenue, Suite 4000
Attention: Victor Cusini
Telephone No.: 312-280-3708
Email Address: vmc@flynnenterprises.net
| (b) | Process Agent. For the purpose of Section 13(c): |
Party B appoints as itsProcess Agent: Not applicable.
| (c) | Offices. The provisions of Section 10(a) will apply to this Agreement. |
| (d) | Multibranch Party. For the purpose of Section 10(b) of this Agreement:- |
Party A is a Multibranch Party and may act through its Charlotte, North Carolina, Chicago, Illinois, San Francisco, California, New York,New York, Boston, Massachusetts or London, England Office, its Canada Branch, located in Toronto, Ontario or such other Office as may be agreed to by the parties in connection with a Transaction.
Party B is not a Multibranch Party.
| (e) | Calculation Agent. The Calculation Agent is Party A. |
| (f) | Credit Support Document. Details of any Credit Support Document:- |
In relation to Party B,
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Party B agrees that the security interests in collateral granted to Party A under theforegoing Credit Support Documents shall secure the obligations of Party B to Party A under this Agreement.
| (g) | Credit Support Provider. |
CreditSupport Provider means in relation to Party B: Subsidiary Guarantor, as defined in the Credit Agreement.
| (h) | Governing Law. This Agreement and any and all controversies arising out of or in relation to this Agreement shall be governed by and construed inaccordance with the laws of the State of New York (without reference to its conflict of laws doctrine). |
| (i) | Netting of Payments. Multiple Transaction Payment Netting shall apply with respect to the following groups of Transactions, but only within such groups,and each such group shall itself be treated separately for purposes of payment netting. |
| (a) | FX Transactions and Currency Option Transactions (each as defined in the 1998 FX and Currency Option Definitions, published by the International Swaps and DerivativesAssociation, Inc. (“ISDA”), Emerging Markets Traders Association, and The Foreign Exchange Committee) (but excluding payments with respect to option premiums and cash settled options); |
| (b) | Like Commodities Transactions (as defined in the 2005 ISDA Commodity Definitions, published by ISDA) (but excluding payments with respect to option premiums). Forpurposes of clarity, gas transactions will net only with other gas transactions; power transactions will net only with other power transactions; metals transactions will net only with other metal transactions, and so on; |
| (c) | Credit Derivatives Transactions (as defined in the 2003 ISDA Credit Derivatives Definitions, published by ISDA); and |
| (d) | Equity Swap Transactions, Option Transactions, Forward Transactions, Index Transactions, Share Transactions, Index Basket Transactions, Share Basket Transactions,Basket Option Transactions, Basket Forward Transactions and Basket Swap Transactions (as defined in the 2002 ISDA Equity Derivatives Definitions, published by ISDA). |
| (j) | “Affiliate” will have the meaning specified in Section 14 of this Agreement. |
| (k) | Absence of Litigation. For the purpose of Section 3(c):- |
“SpecifiedEntity” means in relation to Party B, none.
| (l) | No Agency. The provisions of Section 3(g) will apply to this Agreement. |
| (m) | Additional Representation will apply. For the purpose of Section 3 of this Agreement, each of the following will constitute an AdditionalRepresentation:- |
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| (i) | Relationship Between Parties. Each party will be deemed to represent to the other party on the date on which it enters into a Transaction that (absent awritten agreement between the parties that expressly imposes affirmative obligations to the contrary for that Transaction):- |
| (1) | 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 thatTransaction is appropriate or proper for it based upon its own judgment and upon advice from 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 arecommendation 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.No communication (written or oral) received from the other party will be deemed to be an assurance or guarantee as to the expected results of that Transaction. |
| (2) | Assessment and Understanding. It is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice),and understands and accepts, the terms, conditions and risks of that Transaction. It is also capable of assuming, and assumes, the risks of that Transaction. |
| (3) | Status of Parties. The other party is not acting as a fiduciary for or an advisor to it in respect of that Transaction. |
| (ii) | Each party makes the representations below (which representations will be deemed to be repeated by each party on each date on which a Transaction is entered into): |
| (1) | Eligible Contract Participant. It is an “eligible contract participant” as defined in Section 1a(12) of the U.S. Commodity Exchange Act, 7U.S.C. Section 1a(12); and |
| (2) | It has entered into this Agreement (including each Transaction evidenced hereby) in conjunction with its line of business (including financial intermediation services)or the financing of its business. |
| (n) | Recording of Conversations. Each party to this Agreement acknowledges and agrees to the recording of conversations between trading and marketing personnelof the parties to this Agreement whether by one or other or both of the parties or their agents. |
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Part 5
| (a) | Financial Statements. Section 3(d) is hereby amended by adding in the third line thereof after the word “respect” and before theperiod: |
“or, in the case of financial statements, a fair presentation of the financial condition of therelevant party.”
| (b) | 2002 Master Agreement Protocol. Annexes 1 to 18 and Section 6 of the ISDA 2002 Master Agreement Protocol as published by the International Swaps andDerivatives Association, Inc. on July 15, 2003 are incorporated into and apply to this Agreement. References in those definitions and provisions to any ISDA Master Agreement will be deemed to be references to this Master Agreement. |
| (c) | WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHTS TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISINGOUT OF OR RELATING TO THIS AGREEMENT, ANY CREDIT SUPPORT DOCUMENT OR ANY TRANSACTION CONTEMPLATED HEREBY. |
| (d) | Method of Notice. Section 12(a)(ii) of the Master Agreement is deleted in its entirety. |
| (e) | Safe Harbors. Each party to this Agreement acknowledges that: |
| (i) | This Agreement, including any Credit Support Document, is a “master netting agreement” as defined in the U.S. Bankruptcy Code (the“Code”), and a “netting contract” as defined in the netting provisions of the Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”), and this Agreement, including anyCredit Support Document, and each Transaction hereunder is of a type set forth in Section 561(a)(1)-(5) of the Code; |
| (ii) | Party A is a “master netting agreement participant,” a “financial institution,” a “financial participant,” a “forward contractmerchant” and a “swap participant” as defined in the Code, and a “financial institution” as defined in the netting provisions of FDICIA; |
| (iii) | The remedies provided herein, and in any Credit Support Document, are the remedies referred to in Section 561(a), Sections 362(b)(6), (7), (17) and (27), andSection 362(o) of the Code, and in Section 11(e)(8)(A) and (C) of the Federal Deposit Insurance Act; |
| (iv) | All transfers of cash, securities or other property under or in connection with this Agreement, any Credit Support Document or any Transaction hereunder are“margin payments,” “settlement payments” and “transfers” under Sections 546(e), (f), (g) or (j), and under Section 548(d)(2) of the Code; and |
| (v) | Each obligation under this Agreement, any Credit Support Document or any Transaction hereunder is an obligation to make a “margin payment,” “settlementpayment” and “payment” within the meaning of Sections 362, 560 and 561 of the Code. |
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| (f) | Incorporation by Reference of Terms of Credit Agreement. Party B hereby agrees that, during the period commencing with the date of this Agreement throughand including such date on which all of Party B’s obligations under this Agreement are fully performed, Party B will (a) observe, perform, and fulfill each and every such covenant, term, and provision applicable to Party B, as suchcovenants, terms, and provisions, may be amended from time to time after the date of this Agreement. |
| (g) | Restatement and Amendment of Prior Agreement. This Master Agreement restates and amends in its entirety the ISDA Master Agreement dated as ofAugust 19, 2002 between LaSalle Bank National Association (predecessor to Party A) and Party B (the “Prior Agreement”). Each confirmation to the Prior Agreement shall be deemed a Confirmation subject to this Agreement, and eachtransaction subject to such a confirmation shall be governed hereby. |
| (h) | Hedge Agreement. Party B represents to Party A (which representation will be deemed to be repeated by Party B on each date on which a Transaction isentered into) that this Agreement is a Hedge Agreement as defined in the Credit Agreement. |
Part 6
Additional Terms for Foreign Exchange and Foreign Exchange Option Transactions
| (a) | Incorporation of Definitions. The 1998 FX and Currency Option Definitions (the “FX Definitions”), published by the InternationalSwaps and Derivatives Association, Inc., the Emerging Markets Traders Association and The Foreign Exchange Committee, are hereby incorporated by reference with respect to FX Transactions (as defined in the FX Definitions) and Currency OptionTransactions (as defined in the FX Definitions). Terms defined in the FX Definitions shall have the same meanings in this Part 6. |
| (b) | Scope. Unless otherwise agreed in writing by the parties, each FX Transaction and Currency Option Transaction entered into between the parties before, onor after the date of this Agreement shall be a Transaction under this Agreement and shall be part of, subject to and governed by this Agreement. FX Transactions and Currency Option Transactions shall be part of, subject to and governed by thisAgreement even if the Confirmation in respect thereof does not state that such FX Transaction or Currency Option Transaction is subject to or governed by this Agreement or does not otherwise reference this Agreement. |
When an FX Transaction or a Currency Option is confirmed by means of exchange of electronic messages on an electronic messaging system orother document or other confirming evidence exchanged between the parties confirming such Transaction, such messages, document or evidence will constitute a Confirmation for the purposes of this Agreement even where not so specified therein.
| (c) | Premium Netting. If, on any date, and unless otherwise mutually agreed by the parties, Premiums would otherwise be payable hereunder inthe same Currency between the same respective offices of the parties, then, on such date, each party’s obligation to make payment of such Premiums will be automatically satisfied and discharged and, if the aggregate Premiums that wouldotherwise have been payable by such office of one party exceeds the aggregate Premiums that would otherwise have been payable by such office of the other party, replaced by an obligation upon the party by whom the larger aggregate |
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Premiums would have been payable to pay the other party the excess of the larger aggregate Premiums over the smaller aggregate Premiums, and if the aggregate Premiums are equal, no payment shallbe made. |
| (d) | Payment Netting of FX Transactions and Currency Option Transactions. Multiple Transaction Payment Netting shall not apply to FX Transactions or CurrencyOption Transactions. Unless otherwise mutually agreed by the parties, if on any date more than one delivery of a particular Currency is to be made between a pair of offices with respect to settlement of FX Transactions or Currency OptionTransactions (but excluding payments with respect to option premiums and cash settled options), then each party shall aggregate the amounts of such Currency deliverable by it and only the difference between these aggregate amounts shall be deliveredby the party owing the larger aggregate amount to the other party, and, if the aggregate amounts are equal, no delivery of the Currency shall be made. |
| (e) | Potential Event of Default. Subject to Section 2(a)(iii) of the Agreement, if an Event of Default or Potential Event of Default has occurred and iscontinuing, and an Early Termination Date has not been designated by the Non-defaulting Party, the Non-defaulting Party may, by written notice, specify that any or all Currency Options being settled while such Event of Default or Potential Event ofDefault is continuing shall be settled in accordance with Article 3, Section 3.7 of the FX Definitions and upon such notice becoming effective, the Parties shall be deemed to have elected to have the specified Currency Options settle at theIn-the-Money Amount unless and until the Event of Default or Potential Event of Default is no longer continuing. |
| (f) | Payment Instructions. All payments to be made hereunder in respect of FX and Currency Option Transactions shall be made in accordance with standingpayment instructions provided by the parties from time to time in writing (or as otherwise specified in a Confirmation). |
| (g) | Notice of Exercise. Article 3, Section 3.5(g) of the FX Definitions is amended by the deletion of the word “facsimile,” in the fourth linethereof. |
| (h) | Automatic Exercise. Article 3, Section 3.6(c)(i), line six of the FX Definitions which currently reads “one percent of the Strike Price”shall be amended to read “0.5% of the Strike Price.” |
| (i) | Terms Relating to Premium. Article 3, Section 3.4 of the FX Definitions is hereby amended by the addition of the following as a new paragraph(c) of the FX Definitions. |
“(c) Premium: Failure to Pay on Premium Payment Date. If any Premiumis not received on the Premium Payment Date, the Seller may elect: (i) to accept a late payment of such Premium; (ii) to give written notice of such non- payment and, if such payment shall not be received within two (2) Local BusinessDays of such notice, treat the related Currency Option as void; or (iii) to give written notice of such non-payment and, if such payment shall not be received within two (2) Local Business Days of such notice, treat such non-payment as anEvent of Default under Section 5(a)(i). If the Seller elects to act under either clause (i) or (ii) of the preceding sentence, the Buyer shall pay all out-of-pocket costs and actual damages incurred in connection with such unpaid orlate Premium or void Currency Option, including, without limitation, interest on such Premium in the same currency as such Premium at the then prevailing market rate and any other costs or expenses incurred by the Seller in covering its obligations(including, without limitation, a delta hedge) with respect to such Currency Option.”
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IN WITNESS WHEREOF, the parties have executed this Schedule by their duly authorized officers as ofthe date hereof.
| BANK OF AMERICA, N.A. | LKQ CORPORATION | ||||
| By: | /s/ Roger H. Heintzelman | By: | /s/ John S. Quinn | ||
| Name: | Roger H. Heintzelman | Name: | John S. Quinn | ||
| Title: | Director | Title: | Executive Vice President and CFO | ||
| Date: | Date: | 3-24-11 | |||
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