Common use of Equalization Payments Clause in Contracts

Equalization Payments. Within thirty (30) days following receipt of each statement rendered pursuant to Sections 9.2 and 9.3: (a) the Party with the higher Revenue will pay to the Party with the lower Revenue [***] in Revenue between the Parties; (b) the Party with the lower actual Allowable Expenses will pay to the Party with the higher actual Allowable Expenses [***] in actual Allowable Expenses between the Parties; (c) the Party with the lower Net Investment balance will pay the Party with the higher Net Investment balance [***] in Net Investment between the Parties at the end of such calendar quarter, except that the Party with the lower Net Investment balance may, in lieu of making a payment [***] between the respective Net Investments, elect to pay the other Party a financing fee equal to the weighted average cost of capital of the other Party times [***] in Net Investment between the Parties, times [***]. Weighted average cost of capital will be calculated as cost of equity times (market value of equity/(market value of equity + market value of debt)) + cost of debt times (1- tax rate) times (market value of debt/(market value of equity + market [***] indicates material that has been omitted pursuant to a request for confidential treatment. The omitted material has been filed separately with the Securities and Exchange Commission. value of debt)). For purposes of this Section 9.4(c), market value of debt equals book value of debt, cost of debt equals the U.S. ten (10) year Treasury rate, tax rate equals the marginal U.S. and applicable state tax rate of the other Party, and cost of equity equals the long term equity premium per G▇▇▇▇▇▇ Sachs with an assumed beta of 1 + cost of debt; and (d) the payments due from/to a Party pursuant to Sections 9.4 (a) through (c) may be offset against each other, such that a single payment may be made by one Party to the other Party to fulfill the requirements of this Section 9.4.

Equalization Payments. Within thirty (30) days following receipt of each statement rendered pursuant to Sections 9.2 and 9.3: (a) the Party with the higher Revenue will pay to the Party with the lower Revenue [**********] in Revenue between the Parties;; [**********] Indicates omitted material that is the subject of a confidential treatment request filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. Back to Contents (b) the Party with the lower actual Allowable Expenses will pay to the Party with the higher actual Allowable Expenses [**********] in actual Allowable Expenses between the Parties; (c) the Party with the lower Net Investment balance will pay the Party with the higher Net Investment balance [**********] in Net Investment between the Parties at the end of such calendar quarter, except that the Party with the lower Net Investment balance may, in lieu of making a payment [**********] between the respective Net Investments, elect to pay the other Party a financing fee equal to the weighted average cost of capital of the other Party times [**********] in Net Investment between the Parties, times [**********]. Weighted average cost of capital will be calculated as cost of equity times (market value of equity/(market value of equity + market value of debt)) + cost of debt times (1- tax rate) times (market value of debt/(market value of equity + market [***] indicates material that has been omitted pursuant to a request for confidential treatment. The omitted material has been filed separately with the Securities and Exchange Commission. value of debt)). For purposes of this Section 9.4(c), market value of debt equals book value of debt, cost of debt equals the U.S. ten (10) year Treasury rate, tax rate equals the marginal U.S. and applicable state tax rate of the other Party, and cost of equity equals the long term equity premium per G▇▇▇▇▇▇▇ Sachs ▇▇▇▇▇ with an assumed beta of 1 + cost of debt; and (d) the payments due from/to a Party pursuant to Sections 9.4 (a) through (c) may be offset against each other, such that a single payment may be made by one Party to the other Party to fulfill the requirements of this Section 9.4.