Common use of Replacement Value Clause in Contracts

Replacement Value. The Replacement Value shall be determined by the Non-Defaulting Party or by the Non-Affected Party (or, if there are two Affected Parties, by each Affected Party). For a given Transaction, the Replacement Value shall be the arithmetic mean of quotations from at least two prime market participants. Each of the quotations shall be expressed as the amount that the market participant would pay or receive at the Termination Date if such market participant had to assume as from such date the whole of the financial rights and obligations of the other Party under the relevant Transaction. The resulting amount shall be expressed as a positive amount if it is payable to the market participant; otherwise, it shall be expressed as a negative amount. If only one quotation can be obtained, the Replacement Value shall be determined by such quotation. If no quotation can reasonably be obtained, the Replacement Value shall be equal, as appropriate, to the profit (and shall be a negative amount) of the Party responsible for the calculation or to the loss (and shall be a positive amount) of such Party incurred as a result of termination of the Transaction. The Party determining the Replacement Value shall select the market participants from whom the above quotations are requested. Refers to the difference provided for under Article 8.1.2.