EXHIBIT 10.2 (Multicurrency-Cross
Border)
ISDA registered trademark
International Swap Dealers Association, Inc.
MASTER AGREEMENT
dated as of September 23, 1999
XXXXXXX XXXXX MITSUI MARINE DERIVATIVE PRODUCTS, L.P.
("Party A")-
and-THE BANK OF NEW YORK, acting as trustee for the MBNA MASTER CREDIT
CARD TRUST II ("Party B")
have entered and/or anticipate entering into one or more transactions
(each a "Transaction") that are or will be governed by this Master
Agreement, which includes the schedule (the "Schedule"), and the
documents and other confirming evidence (each a "Confirmation")
exchanged between the parties confirming those Transactions.
Accordingly, the parties agree as follows:-
1. Interpretation
(a) Definitions. The terms defined in Section 14 and in the Schedule
will have the meanings therein specified for the purpose of this Master
Agreement.
(b) Inconsistency. In the event of any inconsistency between the
provisions of the Schedule and the other provisions of this Master
Agreement, the Schedule will prevail. In the event of any
inconsistency between the provisions of any Confirmation and this
Master Agreement (including the Schedule), such Confirmation will
prevail for the purpose of the relevant Transaction.
(c) Single Agreement. All Transactions are entered into in reliance
on the fact that this Master Agreement and all Confirmations form a
single agreement between the parties (collectively referred to as this
"Agreement"), and the parties would not otherwise enter into any
Transactions.
2. Obligations
(a) General Conditions.
(i) Each party will make each payment or delivery specified in
each Confirmation to be made by it subject to the other
provisions of this Agreement.
(ii) Payments under this Agreement will be made on the due date
for value on that date in the place of the account specified in
the relevant Confirmation or otherwise pursuant to this
Agreement, in freely transferable funds and in the manner
customary for payments in the required currency. Where
settlement is by delivery (that is, other than by payment), such
delivery will be made for receipt on the due date in the manner
customary for the relevant obligation unless otherwise specified
in the relevant Confirmation or elsewhere in this Agreement.
(iii) Each obligation of each party under Section 2(a)(i) is
subject to (1) the condition precedent that no Event of Default
or Potential Event of Default with respect to the other party has
occurred and is continuing, (2) the condition precedent that no
Early Termination Date in respect of the relevant Transaction has
occurred or been effectively designated and (3) each other
applicable condition precedent specified in this Agreement.
(b) Change of Account. Either party may change its account for
receiving a payment or delivery by giving notice to the other party at
least five Local Business Days prior to the scheduled date for the
payment or delivery to which such change applies unless such other
party gives timely notice of a reasonable objection to such change.
(c) Netting. If on any date amounts would otherwise be payable:-
(i) in the same currency; and
(ii) in respect of the same Transaction,
by each party to the other, on such date, each party's obligation to
make payment of any such amount will be automatically satisfied and
discharged and, if the aggregate amount that would otherwise have been
payable by one party exceeds the aggregate amount that would otherwise
have been payable by the other party, replaced by an obligation upon
the party by whom the larger aggregate amount would have been payable
to pay to the other party the excess of the larger aggregate amount
over the smaller aggregate amount.
The parties may elect in respect of two or more Transactions that a net
amount will be determined in respect of all amounts payable on the same
date in the same currency in respect of such Transactions, regardless
of whether such amounts are payable in respect of the same Transaction.
The election may be made in the Schedule or a Confirmation by
specifying that subparagraph (ii) above will not apply to the
Transactions identified as being subject to the election, together with
the starting date (in which case subparagraph (ii) above will not, or
will cease to, apply to such Transactions from such date). This
election may be made separately for different groups of Transactions
and will apply separately to each pairing of Offices through which the
parties make and receive
payments or deliveries.
(d) Deduction or Withholding for Tax.
(i) Gross-Up. All payments under this Agreement will be made
without any deduction or withholding for or on account of any Tax
unless such deduction or withholding is required by any applicable
law, as modified by the practice of any relevant governmental
revenue authority, then in effect. If a party is so required to
deduct or withhold, then that party ("X") will:-
(1) promptly notify the other party ("Y") of such
requirement;
(2) pay to the relevant authorities the full amount required
to be deducted or withheld (including the full amount required
to be deducted or withheld from any additional amount paid by
X to Y under this Section 2(d)) promptly upon the earlier of
determining that such deduction or withholding is required or
receiving notice that such amount has been assessed against Y;
(3) promptly forward to Y an official receipt (or a certified
copy), or other documentation reasonably acceptable to Y,
evidencing such payment to such authorities; and
(4) if such Tax is an Indemnifiable Tax, pay to Y, in addition
to the payment to which Y is otherwise entitled under this
Agreement, such additional amount as is necessary to ensure
that the net amount actually received by Y (free and clear of
Indemnifiable Taxes, whether assessed against X or Y) will
equal the full amount Y would have received had no such
deduction or withholding been required. However, X will not
be required to pay any additional amount to Y to the extent
that it would not be required to be paid but for:-
(A) the failure by Y to comply with or perform any agreement
contained in Section 4(a)(i), 4(a)(iii) or 4(d); or
(B) the failure of a representation made by Y pursuant to
Section 3(f) to be accurate and true unless such failure
would not have occurred but for (I) any action taken by a
taxing authority, or brought in a court of competent
jurisdiction, on or after the date on which a Transaction
is entered into (regardless of whether such action is taken
or brought with respect to a party to this Agreement) or
(II) a Change in Tax Law.
(ii) Liability. If:-
(1) X is required by any applicable law, as modified by
the practice of any relevant governmental revenue authority,
to make any deduction or withholding in respect of which X
would not be required to pay an additional amount to Y under
Section 2(d)(i)(4);
(2) X does not so deduct or withhold; and
(3) a liability resulting from such Tax is assessed
directly against X,
then, except to the extent Y has satisfied or then satisfies the
liability resulting from such Tax, Y will promptly pay to X the
amount of such liability (including any related liability for
interest, but including any related liability for penalties only
if Y has failed to comply with or perform any agreement contained
in Section 4(a)(i), 4(a)(iii) or 4(d)).
(e) Default Interest; Other Amounts. Prior to the occurrence or
effective designation of an Early Termination Date in respect of the
relevant Transaction, a party that defaults in the performance of any
payment obligation will, to the extent permitted by law and subject to
Section 6(c), be required to pay interest (before as well as after
judgment) on the overdue amount to the other party on demand in the
same currency as such overdue amount, for the period from (and
including) the original due date for payment to (but excluding) the
date of actual payment, at the Default Rate. Such interest will be
calculated on the basis of daily compounding and the actual number of
days elapsed. If, prior to the occurrence or effective designation of
an Early Termination Date in respect of the relevant Transaction, a
party defaults in the performance of any obligation required to be
settled by delivery, it will compensate the other party on demand if
and to the extent provided for in the relevant Confirmation or
elsewhere in this Agreement.
3. Representations
Each party represents to the other party (which representations will be
deemed to be repeated by each party on each date on which a Transaction
is entered into and, in the case of the representations in Section
3(f), at all times until the termination of this Agreement) that:-
(a) Basic Representations.
(i) Status. It is duly organized and validly existing under the
laws of the jurisdiction of its organization or incorporation
and, if relevant under such laws, in good standing;
(ii) Powers. It has the power to execute this Agreement and any
other documentation relating to this Agreement to which it is a
party, to deliver this Agreement and any other documentation
relating to this Agreement that it is required by this Agreement
to deliver and to perform its obligations under this Agreement
and any obligations it has under any Credit Support Document to
which it is a party and has taken all necessary action to
authorize such execution, delivery and performance;
(iii) No Violation or Conflict. Such execution, delivery and
performance do not violate or conflict with any law applicable to
it, any provision of its constitutional documents, any order or
judgment of any court or other agency of government applicable to
it or any of its assets or any contractual restriction binding on
or affecting it or any of its assets;
(iv) Consents. All governmental and other consents that are
required to have been obtained by it with respect to this
Agreement or any Credit Support Document to which it is a party
have been obtained and are in full force and effect and all
conditions of any such consents have been complied with; and
(v) Obligations Binding. Its obligations under this Agreement and
any Credit Support Document to which it is a party constitute its
legal, valid and binding obligations, enforceable in accordance
with their respective terms (subject to applicable bankruptcy,
reorganization, insolvency, moratorium or similar laws affecting
creditors' rights generally and subject, as to enforceability, to
equitable principles of general application (regardless of
whether enforcement is sought in a proceeding in equity or at
law)).
(b) Absence of Certain Events. No Event of Default or Potential
Event of Default or, to its knowledge, Termination Event with respect
to it has occurred and is continuing and no such event or circumstance
would occur as a result of its entering into or performing its
obligations under this Agreement or any Credit Support Document to
which it is a party.
(c) Absence of Litigation. There is not pending or, to its
knowledge, threatened against it or any of its Affiliates any action,
suit or proceeding at law or in equity or before any court, tribunal,
governmental body, agency or official or any arbitrator that is likely
to affect the legality, validity or enforceability against it of this
Agreement or any Credit Support Document to which it is a party or its
ability to perform its obligations under this Agreement or such Credit
Support Document.
(d) Accuracy of Specified Information. All applicable information
that is furnished in writing by or on behalf of it to the other party
and is identified for the purpose of this Section 3(d) in the Schedule
is, as of the date of the information, true, accurate and complete in
every material aspect.
(e) Payer Tax Representation. Each representation specified in the
Schedule as being made by it for the purpose of this Section 3(e) is
accurate and true.
(f) Payee Tax Representations. Each representation specified in the
Schedule as being made by it for the purpose of this Section 3(f) is
accurate and true.
4. Agreements
Each party agrees with the other that, so long as either party has or
may have any obligations under this Agreement or under any Credit
Support Document to which it is a party:-
(a) Furnish Specified Information. It will deliver to the other
party or, in certain cases under subparagraph (iii) below, to such
government or taxing authority as the other party reasonably directs:-
(i) any forms, documents or certificates relating to taxation
specified in the Schedule or any Confirmation;
(ii) any other documents specified in the Schedule or any
Confirmation; and
(iii) upon reasonable demand by such other party, any form or
document that may be required or reasonably requested in writing
in order to allow such other party or its Credit Support Provider
to make a payment under this Agreement or any applicable Credit
Support Document without any deduction or withholding for or on
account of any Tax or with such deduction or withholding at a
reduced rate (so long as the completion, execution or submission
of such form or document would not materially prejudice the legal
or commercial position of the party in receipt of such demand),
with any such form or document to be accurate and completed in a
manner reasonably satisfactory to such other party and to be
executed and to be delivered with any reasonably required
certification,
in each case by the date specified in the Schedule or such Confirmation
or, if none is specified, as soon as reasonably practicable.
(b) Maintain Authorizations. It will use all reasonable efforts to
maintain in full force and effect all consents of any governmental or
other authority that are required to be obtained by it with respect to
this Agreement or any Credit Support Document to which it is a party
and will use all reasonable efforts to obtain any that may become
necessary in the future.
(c) Comply with Laws. It will comply in all material aspects with
all applicable laws and orders to which it may be subject if failure so
to comply would materially impair its ability to perform its
obligations under this Agreement or any Credit Support Document to
which it is a party.
(d) Tax Agreement. It will give notice of any failure of a
representation made by it under Section 3(f) to be accurate and true
promptly upon learning of such failure.
(e) Payment of Stamp Tax. Subject to Section 11, it will pay any
Stamp Tax levied or imposed upon it or in respect of its execution or
performance of this Agreement by a jurisdiction in which it is
incorporated, organized, managed and controlled, or considered to have
its seat, or in which a branch or office through which it is acting for
the purpose of this Agreement is located ("Stamp Tax Jurisdiction") and
will indemnify the other party against any Stamp Tax levied or imposed
upon the other party or in respect of the other party's execution or
performance of this Agreement by any such Stamp Tax Jurisdiction which
is not also a Stamp Tax Jurisdiction with respect to the other party.
5. Events of Default and Termination Events
(a) Events of Default. The occurrence at any time with respect to a
party or, if applicable, any Credit Support Provider of such party or
any Specified Entity of such party of any of the following events
constitutes an event of default (an "Event of Default") with respect to
such party:-
(i) Failure to Pay or Deliver. Failure by the party to make, when
due, any payment under this Agreement or delivery under Section
2(a)(i) or 2(e) required to be made by it if such failure is not
remedied on or before the third Local Business Day after notice
of such failure is given to the party;
(ii) Breach of Agreement. Failure by the party to comply with
or perform any agreement or obligation (other than an obligation
to make any payment under this Agreement or delivery under
Section 2(a)(i) or 2(e) or to give notice of a Termination Event
or any agreement or obligation under Section 4(a)(i), 4(a)(iii)
or 4(d)) to be complied with or performed by the party in
accordance with this Agreement if such failure is not remedied on
or before the thirtieth day after notice of such failure is given
to the party;
(iii) Credit Support Default.
(1) Failure by the party or any Credit Support Provider of
such party to comply with or perform any agreement or
obligation to be complied with or performed by it in
accordance with any Credit Support Document if such failure
is continuing after any applicable grace period has elapsed;
(2) the expiration or termination of such Credit Support
Document or the failing or ceasing of such Credit Support
Document to be in full force and effect for the purpose of
this Agreement (in either case other than in accordance with
its terms) prior to the satisfaction of all obligations of
such party under each Transaction to which such Credit
Support Document relates without the written consent of the
other party; or
(3) the party or such Credit Support Provider disaffirms,
disclaims, repudiates or rejects, in whole or in part, or
challenges the validity of, such Credit Support Document;
(iv) Misrepresentation. A representation (other than a
representation under Section 3(e) or (f)) made or repeated or
deemed to have been made or repeated by the party or any Credit
Support Provider of such party in this Agreement or any Credit
Support Document proves to have been incorrect or misleading in
any material respect when made or repeated or deemed to have been
made or repeated;
(v) Default under Specified Transaction. The party, any Credit
Support Provider of such party or any applicable Specified Entity
of such party (1) defaults under a Specified Transaction and,
after giving effect to any applicable notice requirement or grace
period, there occurs a liquidation of, an acceleration of
obligations under, or an early termination of, that Specified
Transaction, (2) defaults, after giving effect to any applicable
notice requirement or grace period, in making any payment or
delivery due on the last payment, delivery or exchange date of,
or any payment on early termination of, a Specified Transaction
(or such default continues for at least three Local Business Days
if there is no applicable notice requirement or grace period) or
(3) disaffirms, disclaims, repudiates or rejects, in whole or in
part, a Specified Transaction (or such action is taken by any
person or entity appointed or empowered to operate it or act on
its behalf);
(vi) Cross Default. If "Cross Default" is specified in the
Schedule as applying to the party, the occurrence or existence of
(1) a default, event of default or other similar condition or
event (however
described) in respect of such party, any Credit Support Provider
of such party or any applicable Specified Entity of such party
under one or more agreements or instruments relating to Specified
Indebtedness of any of them (individually or collectively) in an
aggregate amount of not less than the applicable Threshold Amount
(as specified in the Schedule) which has resulted in such
Specified Indebtedness becoming, or becoming capable at such time
of being declared, due and payable under such agreements or
instruments, before it would otherwise have been due and payable
or (2) a default by such party, such Credit Support Provider or
such Specified Entity (individually or collectively) in making
one or more payments on the due date thereof in an aggregate
amount of not less than the applicable Threshold Amount under
such agreements or instruments (after giving effect to any
applicable notice requirement or grace period);
(vii) Bankruptcy. The party, any Credit Support Provider of such
party or any applicable Specified Entity of such party:-
(1) is dissolved (other than pursuant to a consolidation,
amalgamation or merger); (2) becomes insolvent or is unable
to pay its debts or fails or admits in writing its inability
generally to pay its debts as they become due; (3) makes a
general assignment, arrangement or composition with or for
the benefit of its creditors; (4) institutes or has
instituted against it a proceeding seeking a judgment of
insolvency or bankruptcy or any other relief under any
bankruptcy or insolvency law or other similar law affecting
creditors' rights, or a petition is presented for its
winding-up or liquidation, and, in the case of any such
proceeding or petition instituted or presented against it,
such proceeding or petition (A) results in a judgment of
insolvency or bankruptcy or the entry of an order for relief
or the making of an order for its winding-up or liquidation
or (B) is not dismissed, discharged, stayed or restrained in
each case within 30 days of the institution or presentation
thereof; (5) has a resolution passed for its winding-up,
official management or liquidation (other than pursuant to a
consolidation, amalgamation or merger); (6) seeks or becomes
subject to the appointment of an administrator, provisional
liquidator, conservator, receiver, trustee, custodian or
other similar official for it or for all or substantially all
its assets; (7) has a secured party take possession of all or
substantially all its assets or has a distress, execution,
attachment, sequestration or other legal process levied,
enforced or sued on or against all or substantially all its
assets and such secured party maintains possession, or any
such process is not dismissed, discharged, stayed or
restrained, in each case within 30 days thereafter; (8)
causes or is subject to any event with respect to it which,
under the applicable laws of any jurisdiction, has an
analogous effect to any of the events specified in clauses
(1) to (7) (inclusive); or (9) takes any action in
furtherance of, or indicating its consent to, approval of, or
acquiescence in, any of the foregoing acts; or
(viii) Merger Without Assumption. The party or any Credit
Support Provider of such party consolidates or amalgamates with,
or merges with or into, or transfers all or substantially all its
assets to, another entity and, at the time of such consolidation,
amalgamation, merger or transfer:-
(1) the resulting, surviving or transferee entity fails to
assume all the obligations of such party or such Credit
Support Provider under this Agreement or any Credit Support
Document to which it or its predecessor was a party by
operation of law or pursuant to an agreement reasonably
satisfactory to the other party to this Agreement; or
(2) the benefits of any Credit Support Document fail to
extend (without the consent of the other party) to the
performance by such resulting, surviving or transferee
entity of its obligations under this Agreement.
(b) Termination Events. The occurrence at any time with respect to a
party or, if applicable, any Credit Support Provider of such party or
any Specified Entity of such party of any event specified below
constitutes an Illegality if the event is specified in (i) below, a Tax
Event if the event is specified in (ii) below or a Tax Event Upon
Merger if the event is specified in (iii) below, and, if specified to
be applicable, a Credit Event Upon Merger if the event is specified
pursuant to (iv) below or an Additional Termination Event if the event
is specified pursuant to (v) below:-
(i) Illegality. Due to the adoption of, or any change in, any
applicable law after the date on which a Transaction is entered
into, or due to the promulgation of, or any change in, the
interpretation by any court, tribunal or regulatory authority
with competent jurisdiction of any applicable law after such
date, it becomes unlawful (other than as a result of a breach by
the party of Section 4(b)) for such party (which will be the
Affected Party):-
(1) to perform any absolute or contingent obligation to
make a payment or delivery or to receive a payment or
delivery in respect of such Transaction or to comply with
any other material provision of this Agreement relating to
such Transaction; or
(2) to perform, or for any Credit Support Provider of such
party to perform, any contingent or other obligation which
the party (or such Credit Support Provider) has under any
Credit Support Document relating to such Transaction;
(ii) Tax Event. Due to (x) any action taken by a taxing
authority, or brought in a court of competent jurisdiction, on or
after the date on which a Transaction is entered into (regardless
of whether such action is taken or brought with respect to a
party to this Agreement) or (y) a Change in Tax Law, the party
(which will be the Affected Party) will, or there is a
substantial likelihood that it will, on the next succeeding
Scheduled Payment Date (1) be required to pay to the other party
an additional amount in respect of an Indemnifiable Tax under
Section 2(d)(i)(4) (except in respect of interest under Section
2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an
amount is required to be deducted or withheld for or on account
of a Tax (except in respect of interest under Section 2(e),
6(d)(ii) or 6(e)) and no additional amount is required to be paid
in respect of such Tax under Section 2(d)(i)(4) (other than by
reason of Section 2(d)(i)(4)(A) or (B));
(iii) Tax Event Upon Merger. The party (the "Burdened Party") on
the next succeeding Scheduled Payment Date will either (1) be
required to pay an additional amount in respect of an
Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of
interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a
payment from which an amount has been deducted or withheld for or
on account of any Indemnifiable Tax in respect of which the other
party is not required to pay an additional amount (other than by
reason of Section 2(d)(i)(4)(A) or (B)), in either case as a
result of a party consolidating or amalgamating with, or merging
with or into, or transferring all or substantially all its assets
to, another entity (which will be the Affected Party) where such
action does not constitute an event described in Section
5(a)(viii);
(iv) Credit Event Upon Merger. If "Credit Event Upon Merger" is
specified in the Schedule as applying to the party, such party
("X"), any Credit Support Provider of X or any applicable
Specified Entity of X consolidates or amalgamates with, or merges
with or into, or transfers all or substantially all its assets
to, another entity and such action does not constitute an event
described in Section 5(a)(viii) but the creditworthiness of the
resulting, surviving or transferee entity is materially weaker
than that of X, such Credit Support Provider or such Specified
Entity, as the case may be, immediately prior to such action
(and, in such event, X or its successor or transferee, as
appropriate, will be the Affected Party); or
(v) Additional Termination Event. If any "Additional Termination
Event" is specified in the Schedule or any Confirmation as
applying, the occurrence of such event (and, in such event, the
Affected Party or Affected Parties shall be as specified for such
Additional Termination Event in the Schedule or such
Confirmation).
(c) Event of Default and Illegality. If an event or circumstance
which would otherwise constitute or give rise
to an Event of Default also constitutes an Illegality, it will be
treated as an Illegality and will not constitute an
Event of Default.
6. Early Termination
(a) Right to Terminate Following Event of Default. If at any time an
Event of Default with respect to a party (the "Defaulting Party") has
occurred and is then continuing, the other party (the "Non-defaulting
Party") may, by not more than 20 days notice to the Defaulting Party
specifying the relevant Event of Default, designate a day not earlier
than the day such notice is effective as an Early Termination Date in
respect of all outstanding Transactions. If, however, "Automatic Early
Termination" is specified in the Schedule as applying to a party, then
an Early Termination Date in respect of all outstanding Transactions
will occur immediately upon the occurrence with respect to such party
of an Event of Default specified in Section 5(a)(vii)(1), (3), (5), (6)
or, to the extent analogous thereto, (8), and as of the time
immediately preceding the institution of the relevant proceeding or the
presentation of the relevant petition upon the occurrence with respect
to such party of an Event of Default specified in Section 5(a)(vii)(4)
or, to the extent analogous thereto, (8).
(b) Right to Terminate Following Termination Event.
(i) Notice. If a Termination Event occurs, an Affected Party
will, promptly upon becoming aware of it, notify the other party,
specifying the nature of that Termination Event and each Affected
Transaction and will also give such other information about that
Termination Event as the other party may reasonably require.
(ii) Transfer to Avoid Termination Event. If either an
Illegality under Section 5(b)(i)(1) or a Tax Event occurs and
there is only one Affected Party, or if a Tax Event Upon Merger
occurs and the Burdened Party is the Affected Party, the Affected
Party will, as a condition to its right to designate an Early
Termination Date under Section 6(b)(iv), use all reasonable
efforts (which will not require such party to incur a loss,
excluding immaterial, incidental expenses) to transfer within 20
days after it gives notice under Section 6(b)(i) all its rights
and obligations under this Agreement in respect of the Affected
Transactions to another of its Offices or Affiliates so that such
Termination Event ceases to exist.
If the Affected Party is not able to make such a transfer it will
give notice to the other party to that effect within such 20 day
period, whereupon the other party may effect such a transfer
within 30 days after the notice is given under Section 6(b)(i).
Any such transfer by a party under this Section 6(b)(ii) will be
subject to and conditional upon the prior written consent of the
other party, which consent will not be withheld if such other
party's policies in effect at such time would permit it to enter
into transactions with the transferee on the terms proposed.
(iii) Two Affected Parties. If an Illegality under Section
5(b)(i)(1) or a Tax Event occurs and there are two Affected
Parties, each party will use all reasonable efforts to reach
agreement within 30 days after notice thereof is given under
Section 6(b)(i) on action to avoid that Termination Event.
(iv) Right to Terminate. If:-
(1) a transfer under Section 6(b)(ii) or an agreement under
Section 6(b)(iii), as the case may be, has not been effected
with respect to all Affected Transactions within 30 days after
an Affected Party gives notice under Section 6(b)(i); or
(2) an Illegality under Section 5(b)(i)(2), a Credit Event
Upon Merger or an Additional Termination Event occurs, or a
Tax Event Upon Merger occurs and the Burdened Party is not the
Affected Party,
either party in the case of an Illegality, the Burdened Party in
the case of a Tax Event Upon Merger, any Affected Party in the
case of a Tax Event or an Additional Termination Event if there
is more than one Affected Party, or the party which is not the
Affected Party in the case of a Credit Event Upon Merger or an
Additional Termination Event if there is only one Affected Party
may, by not more than 20 days notice to the other party and
provided that the relevant Termination Event is then continuing,
designate a day not earlier than the day such notice is effective
as an Early Termination Date in respect of all Affected
Transactions.
(c) Effect of Designation.
(i) If notice designating an Early Termination Date is given under
Section 6(a) or (b), the Early Termination Date will occur on the
date so designated, whether or not the relevant Event of Default
or Termination Event is then continuing.
(ii) Upon the occurrence or effective designation of an Early
Termination Date, no further payments or deliveries under Section
2(a)(i) or 2(e) in respect of the Terminated Transactions will be
required to be made, but without prejudice to the other
provisions of this Agreement. The amount, if any, payable in
respect of an Early Termination Date shall be determined pursuant
to Section 6(e).
(d) Calculations.
(i) Statement. On or as soon as reasonably practicable following
the occurrence of an Early Termination Date, each party will make
the calculations on its part, if any, contemplated by Section
6(e) and will provide to the other party a statement (1) showing,
in reasonable detail, such calculations (including all relevant
quotations and specifying any amount payable under Section 6(e))
and (2) giving details of the relevant account to which any
amount payable to it is to be paid. In the absence of written
confirmation from the source of a quotation obtained in
determining a Market Quotation, the records of the party
obtaining such quotation will be conclusive evidence of the
existence and accuracy of such quotation.
(ii) Payment Date. An amount calculated as being due in respect
of any Early Termination Date under Section 6(e) will be payable
on the day that notice of the amount payable is effective (in the
case of an Early Termination Date which is designated or occurs
as a result of an Event of Default) and on the day which is two
Local Business Days after the day on which notice of the amount
payable is effective (in the case of an Early Termination Date
which is designated as a result of a Termination Event). Such
amount will be paid together with (to the extent permitted under
applicable law) interest thereon (before as well as after
judgment) in the Termination Currency, from (and including) the
relevant Early Termination Date to (but excluding) the date such
amount is paid, at the Applicable Rate. Such interest will be
calculated on the basis of daily compounding and the actual
number of days elapsed.
(e) Payments on Early Termination. If an Early Termination Date
occurs, the following provisions shall apply based on the parties'
election in the Schedule of a payment measure, either "Market
Quotation" or "Loss", and a payment method, either the "First Method"
or the "Second Method". If the parties fail to designate a payment
measure or payment method in the Schedule, it will be deemed that
"Market Quotation" or the "Second Method", as the case may be, shall
apply. The amount, if any, payable in respect of an Early Termination
Date and determined pursuant to this Section will be subject to any
Set-off.
(i) Events of Default. If the Early Termination Date results from
an Event of Default:-
(1) First Method and Market Quotation. If the First Method
and Market Quotation apply, the Defaulting Party will pay to
the Non-defaulting Party the excess, if a positive number, of
(A) the sum of the Settlement Amount (determined by the Non-
defaulting Party) in respect of the Terminated Transactions
and the Termination Currency Equivalent of the Unpaid Amounts
owing to the Non-defaulting Party over (B) the Termination
Currency Equivalent of the Unpaid Amounts owing to the
Defaulting Party.
(2) First Method and Loss. If the First Method and Loss
apply, the Defaulting Party will pay to the Non-defaulting
Party, if a positive number, the Non-defaulting Party's Loss
in respect of this Agreement.
(3) Second Method and Market Quotation. If the Second Method
and Market Quotation apply, an amount will be payable equal to
(A) the sum of the Settlement Amount (determined by the Non-
defaulting Party) in respect of the Terminated Transactions
and the Termination Currency Equivalent of the Unpaid Amounts
owing to the Non-defaulting Party less (B) the Termination
Currency Equivalent of the Unpaid Amounts owing to the
Defaulting Party. If that amount is a positive number, the
Defaulting Party will pay it to the Non-defaulting Party; if
it is a negative number, the Non-defaulting Party will pay the
absolute value of that amount to the Defaulting Party.
(4) Second Method and Loss. If the Second Method and Loss
apply, an amount will be payable equal to the Non-defaulting
Party's Loss in respect of this Agreement. If that amount is
a positive number, the Defaulting Party will pay it to the
Non-defaulting Party; if it is a negative number, the Non-
defaulting Party will pay the absolute value of that amount to
the Defaulting Party.
(ii) Termination Events. If the Early Termination Date results
from a Termination Event:-
(1) One Affected Party. If there is one Affected Party, the
amount payable will be determined in accordance with Section
6(e)(i)(3), if Market Quotation applies, or Section
6(e)(i)(4), if Loss applies, except that, in either case,
references to the Defaulting Party and to the Non-defaulting
Party will be deemed to be references to the Affected Party
and the party which is not the Affected Party, respectively,
and, if Loss applies and fewer than all the Transactions are
being terminated, Loss shall be calculated in respect of all
Terminated Transactions.
(2) Two Affected Parties. If there are two Affected Parties:-
(A) if Market Quotation applies, each party will
determine a Settlement Amount in respect of the
Terminated Transactions, and an amount will be payable
equal to (I) the sum of (a) one-half of the difference
between the Settlement Amount of the party with the
higher Settlement Amount ("X") and the Settlement Amount
of the party with the lower Settlement Amount ("Y") and
(b) the Termination Currency Equivalent of the Unpaid
Amounts owing to X less (II) the Termination Currency
Equivalent of the Unpaid Amounts owing to Y; and
(B) if Loss applies, each party will determine its
Loss in respect of this Agreement (or, if fewer than all
the Transactions are being terminated, in respect of all
Terminated Transactions) and an amount will be payable
equal to one-half of the difference between the Loss of
the party with the higher Loss ("X") and the Loss of the
party with the lower Loss ("Y").
If the amount payable is a positive number, Y will pay it to X;
if it is a negative number, X will pay the absolute value of
that amount to Y.
(iii) Adjustment for Bankruptcy. In circumstances where an
Early Termination Date occurs because "Automatic Early
Termination" applies in respect of a party, the amount determined
under this Section 6(e) will be subject to such adjustments as
are appropriate and permitted by law to reflect any payments or
deliveries made by one party to the other under this Agreement
(and retained by such other party) during the period from the
relevant Early Termination Date to the date for payment
determined under Section 6(d)(ii).
(iv) Pre-Estimate. The parties agree that if Market Quotation
applies an amount recoverable under this Section 6(e) is a
reasonable pre-estimate of loss and not a penalty. Such amount
is payable for the loss of bargain and the loss of protection
against future risks and except as otherwise provided in this
Agreement neither party will be entitled to recover any
additional damages as a consequence of such losses.
7. Transfer
Subject to Section 6(b)(ii), neither this Agreement nor any interest or
obligation in or under this Agreement may be transferred (whether by
way of security or otherwise) by either party without the prior written
consent of the other party, except that:-
(a) a party may make such a transfer of this Agreement pursuant to a
consolidation or amalgamation with, or merger with or into, or transfer
of all or substantially all its assets to, another entity (but without
prejudice to any other right or remedy under this Agreement); and
(b) a party may make such a transfer of all or any part of its
interest in any amount payable to it from a Defaulting Party under
Section 6(e).
Any purported transfer that is not in compliance with this Section will
be void.
8. Contractual Currency
(a) Payment in the Contractual Currency. Each payment under this
Agreement will be made in the relevant currency specified in this
Agreement for that payment (the "Contractual Currency"). To the extent
permitted by applicable law, any obligation to make payments under this
Agreement in the Contractual Currency will not be discharged or
satisfied by any tender in any currency other than the Contractual
Currency, except to the extent such tender results in the actual
receipt by the party to which payment is owed, acting in a reasonable
manner and in good faith in converting the currency so tendered into
the Contractual Currency, of the full amount in the Contractual
Currency of all amounts payable in respect of this Agreement. If for
any reason the amount in the Contractual Currency so received falls
sort of the amount in the Contractual Currency payable in respect of
this Agreement, the party required to make the payment will, to the
extent permitted by applicable law, immediately pay such additional
amount in the Contractual Currency as may be necessary to compensate
for the shortfall. If for any reason the amount in the Contractual
Currency so received exceeds the amount in the Contractual Currency
payable in respect of this Agreement, the party receiving the payment
will refund promptly the amount of such excess.
(b) Judgments. To the extent permitted by applicable law, if any
judgment or order expressed in a currency other than the Contractual
Currency is rendered (i) for the payment of any amount owing in respect
of this Agreement, (ii) for the payment of any amount relating to any
early termination in respect of this Agreement or (iii) in respect of a
judgment or order of another court for the payment of any amount
described in (i) or (ii) above, the party seeking recovery, after
recovery in full of the aggregate amount to which such party is
entitled pursuant to the judgment or order, will be entitled to receive
immediately from the other party the amount of any shortfall of the
Contractual Currency received by such party as a consequence of sums
paid in such other currency and will refund promptly to the other party
any excess of the Contractual Currency received by such party as a
consequence of sums paid in such other currency if such shortfall or
such excess arises or results from any variation between the rate of
exchange at which the Contractual Currency is converted into the
currency of the judgment or order for the purposes of such judgment or
order and the rate of exchange at which such party is able, acting in a
reasonable manner and in good faith in converting the currency received
into the Contractual Currency, to purchase the Contractual Currency
with the amount of the currency of the judgment or order actually
received by such party. The term "rate of exchange" includes, without
limitation, any premiums and costs of exchange payable in connection
with the purchase of or conversion into the Contractual Currency.
(c) Separate Indemnities. To the extent permitted by applicable law,
these indemnities constitute separate and independent obligations from
the other obligations in this Agreement, will be enforceable as
separate and independent causes of action, will apply notwithstanding
any indulgence granted by the party to which any payment is owed and
will not be affected by judgment being obtained or claim or proof being
made for any other sums payable in respect of this Agreement.
(c) Evidence of Loss. For the purpose of this Section 8, it will be
sufficient for a party to demonstrate that it would have suffered
a loss had an actual exchange or purchase been made.
9. Miscellaneous
(a) Entire Agreement. This Agreement constitutes the entire
agreement and understanding of the parties with respect to its subject
matter and supersedes all oral communication and prior writings with
respect thereto.
(b) Amendments. No amendment, modification or waiver in respect of
this Agreement will be effective unless in writing (including a writing
evidenced by a facsimile transmission) and executed by each of the
parties or confirmed by an exchange of telexes or electronic messages
on an electronic messaging system.
(c) Survival of Obligations. Without prejudice to Sections 2(a)(iii)
and 6(c)(ii), the obligations of the parties under this Agreement will
survive the termination of any Transaction.
(d) Remedies Cumulative. Except as provided in this Agreement, the
rights, powers, remedies and privileges provided in this Agreement are
cumulative and not exclusive of any rights, powers, remedies and
privileges provided by law.
(e) Counterparts and Confirmations.
(i) This Agreement (and each amendment, modification and waiver
in respect of it) may be executed and delivered in counterparts
(including by facsimile transmission), each of which will be
deemed an original.
(ii) The parties intend that they are legally bound by the terms
of each Transaction from the moment they agree to those terms
(whether orally or otherwise). A Confirmation shall be entered
into as soon as practicable and may be executed and delivered in
counterparts (including by facsimile transmission) or be created
by an exchange of telexes or by an exchange of electronic
messages on an electronic messaging system, which in each case
will be sufficient for all purposes to evidence a binding
supplement to this Agreement. The parties will specify therein
or through another effective means that any such counterpart,
telex or electronic message constitutes a Confirmation.
(f) No Waiver of Rights. A failure or delay in exercising any right,
power or privilege in respect of this Agreement will not be presumed to
operate as a waiver, and a single or partial exercise of any right,
power or privilege will not be presumed to preclude any subsequent or
further exercise, of that right, power or privilege or the exercise of
any other right, power or privilege.
(g) Headings. The headings used in this Agreement are for
convenience of reference only and are not to affect the construction of
or to be taken into consideration in interpreting this Agreement.
10. Offices; Multibranch Parties
(a) If Section 10(a) is specified in the Schedule as applying, each
party that enters into a Transaction through an Office other than its
head or home office represents to the other party that, notwithstanding
the place of booking office or jurisdiction of incorporation or
organization of such party, the obligations of such party are the same
as if it had entered into the Transaction through its head or home
office. This representation will be deemed to be repeated by such
party on each date on which a Transaction is entered into.
(b) Neither party may change the Office through which it makes and
receives payments or deliveries for the purpose of a Transaction
without the prior written consent of the other party.
(c) If a party is specified as a Multibranch Party in the Schedule,
such Multibranch Party may make and receive payments or deliveries
under any Transaction through any Office listed in the Schedule, and
the Office through which it makes and receives payments or deliveries
with respect to a Transaction will be specified in the relevant
Confirmation.
11. Expenses
A Defaulting Party will, on demand, indemnify and hold harmless the
other party for and against all reasonable out-of-pocket expenses,
including legal fees and Stamp Tax, incurred by such other party by
reason of the enforcement and protection of its rights under this
Agreement or any Credit Support Document to which the Defaulting Party
is a party or by reason of the early termination of any Transaction,
including, but not limited to, costs of collection.
12. Notices
(a) Effectiveness. Any notice or other communication in respect of
this Agreement may be given in any manner set forth below (except that
a notice or other communication under Section 5 or 6 may not be given
by facsimile transmission or electronic messaging system) to the
address or number or in accordance with the electronic messaging system
details provided (see the Schedule) and will be deemed effective as
indicated:-
(i) if in writing and delivered in person or by courier, on the
date it is delivered;
(ii) if sent by telex, on the date the recipient's answerback is
received;
(iii) if sent by facsimile transmission, on the date that
transmission is received by a responsible employee of the
recipient in legible form (it being agreed that the burden of
proving receipt will be on the sender and will not be met by a
transmission report generated by the sender's facsimile machine);
(iv) if sent by certified or registered mail (airmail, if
overseas) or the equivalent (return receipt requested), on the
date that mail is delivered or its delivery is attempted; or
(v) if sent by electronic messaging system, on the date that
electronic message is received,
unless the date of delivery (or attempted delivery) or that receipt, as
applicable, is not a Local Business Day or that communication is
delivered (or attempted) or received, as applicable, after the close of
business on a Local Business Day, in which case that communication
shall be deemed given and effective on the first following day that is
a Local Business Day.
(b) Change of Addresses. Either party may by notice to the other
change the address, telex or facsimile number or electronic messaging
system details at which notices or other communications are to be given
to it.
13. Governing Law and Jurisdiction
(a) Governing Law. This Agreement will be governed by and construed
in accordance with the law specified in the Schedule.
(b) Jurisdiction. With respect to any suit, action or proceedings
relating to this Agreement ("Proceedings"), each party irrevocably:-
(i) submits to the jurisdiction of the English courts, if this
Agreement is expressed to be governed by English law, or to the
non-exclusive jurisdiction of the courts of the State of New York
and the United States District Court located in the Borough of
Manhattan in New York City, if this Agreement is expressed to be
governed by the laws of the State of New York; and
(ii) waives any objection which it may have at any time to the
laying of venue of any Proceedings brought in any such court,
waives any claim that such Proceedings have been brought in an
inconvenient forum and further waives the right to object, with
respect to such Proceedings, that such court does not have any
jurisdiction over such party.
Nothing in this Agreement precludes either party from bringing
Proceedings in any other jurisdiction (outside, if this Agreement is
expressed to be governed by English law, the Contracting States, as
defined in Section 1(3) of the Civil Jurisdiction and Judgments Xxx
0000 or any modification, extension or re-enactment thereof for the
time being in force) nor will the bringing of Proceedings in any one or
more jurisdictions preclude the bringing of Proceedings in any other
jurisdiction.
(c) Service of Process. Each party irrevocably appoints the Process
Agent (if any) specified opposite its name in the Schedule to receive,
for it and on its behalf, service of process in any Proceedings. If
for any reason any party's Process Agent is unable to act as such, such
party will promptly notify the other party and within 30 days appoint a
substitute process agent acceptable to the other party. The parties
irrevocably consent to service of process given in the manner provided
for notices in Section 12. Nothing in this Agreement will affect the
right of either party to serve process in any other manner permitted by
law.
(d) Waiver of Immunities. Each party irrevocably waives, to the
fullest extent permitted by applicable law, with respect to itself and
its revenues and assets (irrespective of their use or intended use),
all immunity on the grounds of sovereignty or other similar grounds
from (i) suit, (ii) jurisdiction of any court, (iii) relief by way of
injunction, order for specific performance or for recovery of
property, (iv) attachment of its assets (whether before or after
judgment) and (v) execution or enforcement of any judgment to which it
or its revenues or assets might otherwise be entitled in any
Proceedings in the courts of any jurisdiction and irrevocably agrees,
to the extent permitted by applicable law, that it will not claim any
such immunity in any Proceedings.
14. Definitions
As used in this Agreement:-
"Additional Termination Event" has the meaning specified in Section
5(b).
"Affected Party" has the meaning specified in Section 5(b).
"Affected Transactions" means (a) with respect to any Termination Event
consisting of an Illegality, Tax Event or Tax Event Upon Merger, all
Transactions affected by the occurrence of such Termination Event and
(b) with respect to any other Termination Event, all Transactions.
"Affiliate" means, subject to the Schedule, in relation to any person,
any entity controlled, directly or indirectly, by the person, any
entity that controls, directly or indirectly, the person or any entity
directly or indirectly under common control with the person. For this
purpose, "control" of any entity or person means ownership of a
majority of the voting power of the entity or person.
"Applicable Rate" means:-
(a) in respect of obligations payable or deliverable (or which would
have been but for Section 2(a)(iii)) by a Defaulting Party, the Default
Rate;
(b) in respect of an obligation to pay an amount under Section 6(e)
of either party from and after the date (determined in accordance with
Section 6(d)(ii)) on which that amount is payable, the Default Rate;
(c) in respect of all other obligations payable or deliverable (or
which would have been but for Section 2(a)(iii)) by a Non-defaulting
Party, the Non-default Rate; and
(d) in all other cases, the Termination Rate.
"Burdened Party" has the meaning specified in Section 5(b).
"Change in Tax Law" means the enactment, promulgation, execution or
ratification of, or any change in or amendment to, any law (or in the
application or official interpretation of any law) that occurs on or
after the date on which the relevant Transaction is entered into.
"consent" includes a consent, approval, action, authorization,
exemption, notice, filing, registration or exchange control consent.
"Credit Event Upon Merger" has the meaning specified in Section 5(b).
"Credit Support Document" means any agreement or instrument that is
specified as such in this Agreement.
"Credit Support Provider" has the meaning specified in the Schedule.
"Default Rate" means a rate per annum equal to the cost (without proof
or evidence of any actual cost) to the relevant payee (as certified by
it) if it were to fund or of funding the relevant amount plus 1% per
annum.
"Defaulting Party" has the meaning specified in Section 6(a).
"Early Termination Date" means the date determined in accordance with
Section 6(a) or 6(b)(iv).
"Event of Default" has the meaning specified in Section 5(a) and, if
applicable, in the Schedule.
"Illegality" has the meaning specified in Section 5(b).
"Indemnifiable Tax" means any Tax other than a Tax that would not be
imposed in respect of a payment under this Agreement but for a present
or former connection between the jurisdiction of the government or
taxation authority imposing such Tax and the recipient of such payment
or a person related to such recipient (including, without limitation, a
connection arising from such recipient or related person being or
having been a citizen or resident of such jurisdiction, or being or
having been organised, present or engaged in a trade or business in
such jurisdiction, or having or having had a permanent establishment or
fixed place of business in such jurisdiction, but excluding a
connection arising solely from such recipient or related person having
executed, delivered, performed its obligations or received a payment
under, or enforced, this Agreement or a Credit Support Document).
"law" includes any treaty, law, rule or regulation (as modified, in the
case of tax matters, by the practice of any relevant governmental
revenue authority) and "lawful" and "unlawful" will be construed
accordingly.
"Local Business Day" means, subject to the Schedule, a day on which
commercial banks are open for business (including dealings in foreign
exchange and foreign currency deposits) (a) in relation to any
obligation under Section 2(a)(i), in the place(s) specified in the
relevant Confirmation or, if not so specified, as otherwise agreed by
the parties in writing or determined pursuant to provisions contained,
or incorporated by reference, in this Agreement, (b) in relation to any
other payment, in the place where the relevant account is located and,
if different, in the principal financial centre, if any, of the
currency of such payment, (c) in relation to any notice or other
communication, including notice contemplated under Section 5(a)(i), in
the city specified in the address for notice provided by the recipient
and, in the case of a notice contemplated by Section 2(b), in the place
where the relevant new account is to be located and (d) in relation to
Section 5(a)(v)(2), in the relevant locations for performance with
respect to such Specified Transaction.
"Loss" means, with respect to this Agreement or one or more Terminated
Transactions, as the case may be, and a party, the Termination Currency
Equivalent of an amount that party reasonably determines in good faith
to be its total losses and costs (or gain, in which case expressed as a
negative number) in connection with this Agreement or that Terminated
Transaction or group of Terminated Transactions, as the case may be,
including any loss of bargain, cost of funding or, at the election of
such party but without duplication, loss or cost incurred as a result
of its terminating, liquidating, obtaining or reestablishing any hedge
or related trading position (or any gain resulting from any of them).
Loss includes losses and costs (or gains) in respect of any payment or
delivery required to have been made (assuming satisfaction of each
applicable condition precedent) on or before the relevant Early
Termination Date and not made, except, so as to avoid duplication, if
Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does not
include a party's legal fees and out-of-pocket expenses referred to
under Section 11. A party will determine its Loss as of the relevant
Early Termination Date, or, if that is not reasonably practicable, as
of the earliest date thereafter as is reasonably practicable. A party
may (but need not) determine its Loss by reference to quotations of
relevant rates or prices from one or more leading dealers in the
relevant markets.
"Market Quotation" means, with respect to one or more Terminated
Transactions and a party making the determination, an amount determined
on the basis of quotations from Reference Market-makers. Each
quotation will be for an amount, if any, that would be paid to such
party (expressed as a negative number) or by such party (expressed as a
positive number) in consideration of an agreement between such party
(taking into account any existing Credit Support Document with respect
to the obligations of such party) and the quoting Reference Market-
maker to enter into a transaction (the "Replacement Transaction") that
would have the effect of preserving for such party the economic
equivalent of any payment or delivery (whether the underlying
obligation was absolute or contingent and assuming the satisfaction of
each applicable condition precedent) by the parties under Section
2(a)(i) in respect of such Terminated Transaction or group of
Terminated Transactions that would, but for the occurrence of the
relevant Early Termination Date, have been required after that date.
For this purpose, Unpaid Amounts in respect of the Terminated
Transaction or group of Terminated Transactions are to be excluded but,
without limitation, any payment or delivery that would, but for the
relevant Early Termination Date, have been required (assuming
satisfaction of each applicable condition precedent) after that Early
Termination Date is to be included. The Replacement Transaction would
be subject to such documentation as such party and the Reference
Market-maker may, in good faith, agree. The party making the
determination (or its agent) will request each Reference Market-maker
to provide its quotation to the extent reasonably practicable as of the
same day and time (without regard to different time zones) on or as
soon as reasonably practicable after the relevant Early Termination
Date. The day and time as of which those quotations are to be obtained
will be selected in good faith by the party obligated to make a
determination under Section 6(e), and, if each party is so obliged,
after consultation with the other. If more than three quotations are
provided, the Market Quotation will be the arithmetic mean of the
quotations, without regard to the quotations having the highest and
lowest values. If exactly three such quotations are provided, the
Market Quotation will be the quotation remaining after disregarding the
highest and lowest quotations. For this purpose, if more than one
quotation has the same highest value or lowest value, then one of such
quotations shall be disregarded. If fewer than three quotations are
provided, it will be deemed that the Market Quotation in respect of
such Terminated Transaction or group of Terminated Transactions cannot
be determined.
"Non-default Rate" means a rate per annum equal to the cost (without
proof or evidence of any actual cost) to the Non-defaulting party (as
certified by it) if it were to fund the relevant amount.
"Non-defaulting Party" has the meaning specified in Section 6(a).
"Office" means a branch or office of a party, which may be such party's
head or home office.
"Potential Event of Default" means any event which, with the giving of
notice or the lapse of time or both, would constitute an Event of
Default.
"Reference Market-makers" means four leading dealers in the relevant
market selected by the party determining a Market Quotation in good
faith (a) from among dealers of the highest credit standing which
satisfy all the criteria that such party applies generally at the time
in deciding whether to offer or to make an extension of credit and (b)
to the extent practicable, from among such dealers having an office in
the same city.
"Relevant Jurisdiction" means, with respect to a party, the
jurisdictions (a) in which the party is incorporated, organized,
managed and controlled or considered to have its seat, (b) where an
Office through which the party is acting for purposes of this Agreement
is located, (c) in which the party executes this Agreement and (d) in
relation to any payment, from or through which such payment is made.
"Scheduled Payment Date" means a date on which a payment or delivery is
to be made under Section 2(a)(i) with respect to a Transaction.
"Set-off" means set-off, offset, combination of accounts, right of
retention or withholding or similar right or requirement to which the
payer of an amount under Section 6 is entitled or subject (whether
arising under this Agreement, another contract, applicable law or
otherwise) that is exercised by, or imposed on, such payer.
"Settlement Amount" means, with respect to a party and any Early
Termination Date, the sum of:-
(a) the Termination Currency Equivalent of the Market Quotations
(whether positive or negative) for each Terminated Transaction or group
of Terminated Transactions for which a Market Quotation is determined;
and
(b) such party's Loss (whether positive or negative and without
reference to any Unpaid Amounts) for each Terminated Transaction or
group of Terminated Transactions for which a Market Quotation cannot be
determined or would not (in the reasonable belief of the party making
the determination) produce a commercially reasonable result.
"Specified Entity" has the meaning specified in the Schedule.
"Specified Indebtedness" means, subject to the Schedule, any obligation
(whether present or future, contingent or otherwise, as principal or
surety or otherwise) in respect of borrowed money.
"Specified Transaction" means, subject to the Schedule, (a) any
transaction (including an agreement with respect thereto) now existing
or hereafter entered into between one party to this Agreement (or any
Credit Support Provider of such party or any applicable Specified
Entity of such party) and the other party to this Agreement (or any
Credit Support Provider of such other party or any applicable Specified
Entity of such other party) which is a rate swap transaction, basis
swap, forward rate transaction, commodity swap, commodity option,
equity or equity index swap, equity or equity index option, bond
option, interest rate option, foreign exchange transaction, cap
transaction, floor transaction, collar transaction, currency swap
transaction, cross-currency rate swap transaction, currency option or
any other similar transaction (including any option with respect to any
of these transactions), (b) any combination of these transactions and
(c) any other transaction identified as a Specified Transaction in this
Agreement or the relevant confirmation.
"Stamp Tax" means any stamp, registration, documentation or similar
tax.
"Tax" means any present or future tax, levy, impost, duty, charge,
assessment or fee of any nature (including interest, penalties and
additions thereto) that is imposed by any government or other taxing
authority in respect of any payment under this Agreement other than a
stamp, registration, documentation or similar tax.
"Tax Event" has the meaning specified in Section 5(b).
"Tax Event Upon Merger" has the meaning specified in Section 5(b).
"Terminated Transactions" means with respect to any Early Termination
Date (a) if resulting from a Termination Event, all Affected
Transactions and (b) if resulting from an Event of Default, all
Transactions (in either case) in effect immediately before the
effectiveness of the notice designating that Early Termination Date
(or, if "Automatic Early Termination" applies, immediately before that
Early Termination Date).
"Termination Currency" has the meaning specified in the Schedule.
"Termination Currency Equivalent" means, in respect of any amount
denominated in the Termination Currency, such Termination Currency
amount and, in respect of any amount denominated in a currency other
than the Termination Currency (the "Other Currency"), the amount in the
Termination Currency determined by the party making the relevant
determination as being required to purchase such amount of such Other
Currency as at the relevant Early Termination Date, or, if the relevant
Market Quotation or Loss (as the case may be), is determined as of a
later date, that later date, with the Termination Currency at the rate
equal to the spot exchange rate of the foreign exchange agent (selected
as provided below) for the purchase of such Other Currency with the
Termination Currency at or about 11:00 a.m. (in the city in which such
foreign exchange agent is located) on such date as would be customary
for the determination of such a rate for the purchase of such Other
Currency for value on the relevant Early Termination Date or that later
date. The foreign exchange agent will, if only one party is obliged to
make a determination under Section 6(e), be selected in good faith by
that party and otherwise will be agreed by the parties.
"Termination Event" means an Illegality, a Tax Event or a Tax Event
Upon Merger or, if specified to be applicable, a Credit Event Upon
Merger or an Additional Termination Event.
"Termination Rate" means a rate per annum equal to the arithmetic mean
of the cost (without proof or evidence of any actual cost) to each
party (as certified by such party) if it were to fund or of funding
such amounts.
"Unpaid Amounts" owing to any party means, with respect to an Early
Termination Date, the aggregate of (a) in respect of all Terminated
Transactions, the amounts that became payable (or that would have
become payable but for Section 2(a)(iii)) to such party under Section
2(a)(i) on or prior to such Early Termination Date and which remain
unpaid as at such Early Termination Date and (b) in respect of each
Terminated Transaction, for each obligation under Section 2(a)(i) which
was (or would have been but for Section 2(a)(iii)) required to be
settled by delivery to such party on or prior to such Early Termination
Date and which has not been so settled as at such Early Termination
Date, an amount equal to the fair market value of that which was (or
would have been) required to be
delivered as of the originally scheduled date for delivery, in each
case together with (to the extent permitted under applicable law)
interest, in the currency of such amounts, from (and including) the
date such amounts or obligations were or would have been required to
have been paid or performed to (but excluding) such Early Termination
Date, at the Applicable Rate. Such amounts of interest will be
calculated on the basis of daily compounding and the actual number of
days elapsed. The fair market value of any obligation referred to in
clause (b) above shall be reasonably determined by the party obliged to
make the determination under Section 6(e) or, if each party is so
obliged, it shall be the average of the Termination Currency
Equivalents of the fair market values reasonably determined by both
parties.
IN WITNESS WHEREOF the parties have executed this document on the
respective dates specified below with effect from the date specified on
the first page of this document.
Xxxxxxx Xxxxx Mitsui Marine Derivative Products, L.P.--
MBNA MASTER CREDIT CARD TRUST II
(Name of Party)
(Name of Party)
By /s/ Xxxx Xxxxxxxxx By: The Bank of
New York
Name: Xxxx Xxxxxxxxx solely in its capacity as
Trustee and not in its
Title: Managing Director individual capacity
Date: 9/22/99
By___________________________
___________
Name: Xxxxx X. Xxxxxx
Title: Assistant Treasurer
Date: 9/23/99
EXECUTION COPY
SCHEDULE
to the
Master Agreement
dated as of September 23, 1999
between
XXXXXXX XXXXX MITSUI MARINE
DERIVATIVE PRODUCTS, L.P. ("Party A"),
and
THE BANK OF NEW YORK (the "Trustee")
acting as trustee for
The MBNA MASTER CREDIT CARD TRUST II ("Party B"), a trust formed
pursuant to a pooling and servicing agreement dated as of August 4,
1994 (as amended and supplemented from time to time, the "Pooling and
Servicing Agreement"), as supplemented by the Series 1999-J Supplement
dated as of September 23, 1999, each between MBNA America Bank,
National Association, as Seller and Servicer, and the Trustee (the
Pooling and Servicing Agreement, as so supplemented, the "Trust
Agreement").
Part 1. Termination Provisions
In this Agreement:
(a) "Specified Entity" shall not apply for purposes of this
Agreement.
(b) "Specified Transaction" will have the meaning specified in
Section 14 of this Agreement.
(c) The "Breach of Agreement" provisions of Section 5(a)(ii), the
"Misrepresentation" provisions of Section 5(a)(iv), the "Default
under Specified Transaction" provisions of Section 5(a)(v), the
"Cross Default" provisions of Section 5(a)(vi), the "Merger
Without Assumption" provisions of Section 5(a)(viii), the "Tax
Event" provisions of Section 5(b)(ii), "Tax Event Upon Merger"
provisions of Section 5(b)(iii), and the "Credit Event Upon
Merger" provisions of Section 5(b)(iv) will not apply to Party A
and will not apply to Party B. Solely with respect to payments
required to be made by Party A relating to the Rapid Accumulation
Period, the word "third" in the final line of Section 5(a)(i)
shall be replaced with "12:00 noon New York City time of the
first".
(d) The "Automatic Early Termination" provisions of Section 6(a) will
not apply to Party A and will not apply to Party B.
(e) Payments on Early Termination. For the purpose of Section 6(e)
of this Agreement, Market Quotation and the Second Method will
apply; provided, however, that in the case of an Event of Default
with respect to Party A as the Defaulting Party or a Termination
Event with respect to Party A as the sole Affected Party, the
related Settlement Amount, if negative, will be deemed to be zero
if the Market Quotation cannot be determined.
(f) Market Quotation. Notwithstanding anything to the contrary in
the definition of Market Quotation in Section 14, in the case of
an Event of Default with respect to Party A as the Defaulting
Party or a Termination Event with respect to Party A as the
Affected Party, the Market Quotation for any amount to be paid to
Party A will be deemed to be the quotation with the highest
absolute value received from any Reference Market-maker, even if
only one quotation is provided, with which Party B is able, using
its best efforts, to enter into a Replacement Transaction even if
Party B reasonably believes such Market Quotation would not
produce a commercially reasonable result; provided, however, that
in the event only one quotation is provided, Party A may
designate up to three additional Reference Market-makers not
originally selected by Party B from which Party B will solicit
additional quotations for purposes of this provision.
(g) "Reference Market-maker" will not have the meaning specified in
Section 14, but will instead mean the following:
"Reference Market-maker" means four leading dealers in the
relevant market selected by the party determining the
Market Quotation in good faith (a) from among dealers which
are rated not lower than investment grade by S&P and
Moody's which satisfy the criteria that such party applies
generally at that time in deciding whether to offer or make
an extension of credit or to enter into transactions
similar in nature to the Transactions and (b) to the extent
practicable, from among dealers having an office in the
same city.
(h) "Termination Currency" means United States Dollars ("USD").
(i) Section 5(a)(vii) is hereby amended by adding in clause (1)
thereof after the word "merger" and before the closed
parenthetical the words "or, in the case of Party A, any Credit
Support Provider of Party A, or any applicable Specified Entity
of Party A (as the case may be), reconstitution, incorporation,
or admission or withdrawal of a partner".
Part 2. Tax Representations.
(a) Payer Tax Representations. For the purpose of Section 3(e) of
this Agreement, Party A and Party B will each make the following
representation:
It is not required by any applicable law, as modified by the
practice of any relevant governmental revenue authority, of any
Relevant Jurisdiction to make any deduction or withholding for or
on account of any Tax from any payment (other than interest under
Sections 2(e), 6(d)(ii) and 6(e) of this Agreement) to be made by
it to the other party under this Agreement. In making this
representation, it may rely on (i) the accuracy of any
representation made by the other party pursuant to Section 3(f)
of this Agreement, (ii) the satisfaction of the agreement
contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and
the accuracy and effectiveness of any document provided by the
other party pursuant to Section 4(a)(i) and 4(a)(iii) of this
Agreement; and (iii) the satisfaction of the agreement of the
other party contained in Section 4(d) of this Agreement, provided
that it shall not be a breach of this representation where
reliance is placed on clause (ii) and the other party does not
deliver a form of document under Section 4(a)(iii) by reason of
material prejudice to its legal or commercial position.
(b) Payee Representations. For the purpose of Section 3(f) of this
Agreement, Party A and Party B make the following
representations:
(i) The following representation will apply to Party B:
For United States federal income tax purposes it is a
"United States Person" as defined in 7701 (a)(30) of the
Internal Revenue Code.
(ii) The following representation will apply to Party A:
Each payment received or to be received by it in connection with
this Agreement will be wholly exempt from deduction or
withholding of Tax imposed by the United States or any political
subdivision or taxing authority thereof or therein because it is
a domestic partnership as defined in Internal Revenue Code
section 7701(a)(30)(B).
Part 3. Agreement to Deliver Documents.
For the purpose of Sections 3(d), 4(a)(i) and (ii) of this
Agreement, each party agrees to deliver the following documents,
as applicable:
(a) Tax forms, documents or certificates to be delivered are:
Party required
to deliver
document-Form/Document/Certificate-Date by which
to be delivered-Covered by Section 3(d) Representation
Party B-Any form or document that may be reasonably requested, and that
Party B is eligible to provide, in order to allow the requesting party
to make a payment without (or with reduced) withholding Tax.-Promptly
upon reasonable demand by the other party.-Yes
Party A-An accurate and complete signed copy of (i) Internal Revenue
Service Form W-9 and (ii) such other related forms (including any
certificate with respect thereto) as Party B may reasonably request.-
(i) Concurrently with the execution and delivery of this Agreement and
the Confirmation, (ii) prior to the expiration of the immediately
preceding form that was in full force and effect, and (iii) at any time
that a change in circumstances renders the preceding form inaccurate or
incomplete in any material respect.-Yes
(b) Other documents to be delivered are:
Party required to deliver document-Form/Document/Certificate-Date by
which to be delivered-Covered by
Section 3(d)
Party A-Opinions of internal counsel for Party A substantially in the
form of Exhibit A to this Schedule-Upon execution of this Agreement-Yes
Party A-A power of attorney with respect to Party A-Upon execution of
this Agreement-Yes
Party B-An opinion of counsel for Party B substantially in the form of
Exhibit B to this Schedule-Upon execution of this Agreement-Yes
Party B-An incumbency certificate with respect to the signatory of this
Agreement-Upon execution of this Agreement-Yes
Party B-Documentary evidence of authority of The Bank of New York, as
Trustee, to act on behalf of Party B-Upon execution of this Agreement-
Yes
Part 4. Miscellaneous.
(a) Addresses for Notices. For the purpose of Section 12(a):
Address for notices or communications to Party A:
Address: Xxxxxxx Xxxxx Mitsui Marine
Derivative Products, L.P.
Back Office Operations
c/o 00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxx
Telephone No.: 000-000-0000
Facsimile No.: 000-000-0000
with a copy to:
Xxxxxxx, Xxxxx & Co.
One Xxx Xxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx III
Telephone No.: 000-000-0000
Facsimile No.: 000-000-0000
Address for notices or communications to Party B:
Address: MBNA Master Credit Card Trust II
x/x Xxx Xxxx xx Xxx Xxxx, as Trustee
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Department
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
with a copy to:
MBNA Master Credit Card Trust II
MBNA America Bank, National Association,
as Servicer
Securitization Servicing
Wilmington, Delaware 19884-0760
Attention: Xxxxxxxx Xxxxxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
For all purposes.
(b) Process Agent. For the purpose of Section 13(c):
Party A appoints as its Process Agent: Not applicable.
Party B appoints as its Process 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(c) of this
Agreement.
Party A is not a Multibranch Party.
Party B is not a Multibranch Party.
(e) Calculation Agent. The Calculation Agent is the Trustee, unless
otherwise specified in a Confirmation in relation to the relevant
Transaction.
(f) Credit Support Document. Details of any Credit Support Document:
In the case of Party A: Support Agreement dated as of October 8,
1993 among Party A, Mitsui Marine and Fire
Insurance Co., Ltd. and The Xxxxxxx Xxxxx
Group, L.P.
In the case of Party B: Not applicable.
(g) Credit Support Provider.
In relation to Party A: Not applicable.
In relation 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 choice of law doctrine but without prejudice to the
provisions of Section 5-1401 of the General Obligations Law of
the State of New York).
(i) Netting of Payments. Subparagraph (ii) of Section 2(c) of this
Agreement will apply to any of the Transactions, except that it
will not apply to payments by each Party to the other if Party B
so notifies Party A ten (10) days in advance of the date such
Payments are due.
(j) "Affiliate" will have the meaning specified in Section 14 of this
Agreement, except that with respect to Party B there shall be
deemed to be no Affiliates.
Part 5. Other Provisions.
(a) Confirmation. Each Confirmation supplements, forms part of, and
will be read and construed as one with, this Agreement. A form
of Confirmation is set forth as Exhibit C hereto.
(b) Waiver of Trial By Jury. Each party waives, to the fullest
extent permitted by applicable law, any right it may have to a
trial by jury in respect of any suit, action or proceeding
relating to this Agreement. Each party (i) certifies that no
representative, agent or attorney of the other party has
represented, expressly or otherwise, that such other party would
not, in the event of such a suit, action or proceeding, seek to
enforce the foregoing waiver and (ii) acknowledges that it and
the other party have been induced to enter this Agreement by,
among other things, the mutual waivers and certifications in this
Section.
(c) Non-Petition. Party A hereby agrees that it will not bring any
action (whether in bankruptcy or otherwise) against Party B in
any court prior to the date which is one year and one day after
all Investor Certificates (as such term is defined in the Pooling
and Servicing Agreement), including all collateral interests and
class C interests, of Party B have been paid in full.
(d) Assignment. In the event the long-term, unsecured,
unsubordinated debt obligation rating or financial program rating
(or other similar rating) of Party A is lowered to below the
category of BBB- by Standard & Poor's Corporation ("S&P") or Baa3
by Xxxxx'x Investor Services ("Moody's") or such rating agencies'
then equivalent ratings, or such ratings are withdrawn by either
S&P or Moody's, Party A shall use its best efforts to assign and
delegate its rights and obligations under any Transaction to a
replacement counterparty, subject to the prior written direction
of Party B.
(e) Provision for Payments from Party B. Notwithstanding anything
contained in this Agreement to the contrary, any amount required
to be paid by Party B pursuant to this Agreement will be payable
only to the extent provided in subsections 4.09(a)(ii) and
4.16(e) of the Trust Agreement (as each such term is defined in
the Confirmation). Except as expressly provided in Part 5(j)
below, the Trustee shall not be required to expend or risk its
own funds or otherwise incur any liability in connection with
this Agreement, and Party A shall not bring any claim whatsoever
against the Trustee in its individual capacity or against the
assets of the Trustee (other than the assets of the Trust).
(f) Definition of Trustee. For purposes of this Agreement the term
"Trustee" shall mean The Bank of New York as trustee for Party B.
(g) Relationship Between Parties. Each party will be deemed to
represent to the other party on the date on which it enters into
this Agreement that (absent a written agreement between the
parties that expressly imposes affirmative obligations to the
contrary):
(i) Non-Reliance. It is acting for its own account, and it has
made its own independent decisions to enter into this
Agreement and as to whether this Agreement is appropriate
or proper for it based upon its own judgment and upon
advice from such advisers as it has deemed necessary. It
is not relying on any communication (written or oral) of
the other party as investment advice or as a recommendation
to enter into this Agreement; it being understood that
information and explanations related to the terms and
conditions of this Agreement shall not be considered
investment advice or a recommendation to enter into this
Agreement. No communication (written or oral) received
from the other party shall be deemed to be an assurance or
guarantee as to the expected results of this Agreement.
(ii) 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 this
Agreement. It is also capable of assuming, and assumes,
the risks of this Agreement.
(iii) Status of Parties. The other party is not acting as a
fiduciary for or as adviser to it in respect of this
Agreement.
(h) Additional Representations. Each of Party A and Party B
represents that it is an "eligible swap participant" as defined
in Commodities Futures Trading Commission Rule 35.1(b)(2)(vi) (17
C.F.R. 35(b)(2)(vi)).
(i) Negative Interest Rates. Party A and Party B agree that:
if, with respect to a Calculation Period for a Transaction, a
party ("X") is obligated to pay a Floating Amount that is a
negative number (either by reason of a negative Floating Rate or
the subtraction of a Spread from the Floating Rate), the Floating
Amount with respect to X for that Calculation Period will be
deemed to be zero, and the other party ("Y") will pay to X the
absolute value of the negative Floating Amount, in addition to
any amounts otherwise owned by Y to X, on the Payment Date such
Floating Amount would have been payable if it had been a positive
number. Any amounts paid by Y to X pursuant to this provision
will be paid to such account as X may designate (unless Y gives
timely notice of a reasonable objection to such designation) in
the currency in which that Floating Amount would have been paid
if it had been a positive number (and without regard to the
currency in which Y is otherwise obligated to make payments).
(j) Limited Recourse. It is expressly understood and agreed by the
parties hereto that (i) this Agreement and each Transaction
entered into pursuant to this Agreement is entered into by The
Bank of New York, not individually or personally but solely as
Trustee of the MBNA Master Credit Card Trust II (the "Trust") in
the exercise of the powers and authority conferred and vested in
it, (ii) the representations, undertakings and agreements herein
made on the part of the Trust are made and intended not as
personal representations, undertakings and agreements by the
Trustee but are made and intended for the purpose of binding only
the Trust, (iii) nothing herein contained shall be construed as
creating any liability on the Trustee, individually or
personally, to perform any covenant either expressed or implied
contained herein on the part of the Trust, all such liability, if
any, being expressly waived by the parties who are signatories to
this Agreement and by any Persons claiming by, through or under
such parties; provided, however, that the Trustee shall be liable
in its individual capacity for its own willful misconduct or
gross negligence and for the representations made expressly by
the Trustee in Part 5(n) hereof and (iv) under no circumstances
shall the Trustee be personally liable for the payment of any
indebtedness or expenses of the Trust or be liable for the breach
or failure of any obligation, representation, warranty or
covenant made or undertaken by the Trust under this Agreement.
(k) Accuracy of Specified Information. Section 3(d) is hereby
amended by adding after the word "respect" and before the period
the words "or, in the case of audited or unaudited financial
statements or balance sheets, a fair presentation of the
financial condition of the relevant person."
(l) Severability. If any term, provision, covenant, or condition of
this Agreement, or the application thereof to any party or
circumstance, shall be held to be invalid or unenforceable (in
whole or in part) for any reason, the remaining terms,
provisions, covenants, and conditions hereof shall continue in
full force and effect as if this Agreement had been executed with
the invalid or unenforceable portion eliminated, so long as this
Agreement as so modified continues to express, without material
change, the original intentions of the parties as to the subject
matter of this Agreement and the deletion of such portion of this
Agreement will not substantially impair the respective benefits
or expectations of the parties to this Agreement; provided,
however, that this severability provision shall not be applicable
if any provision of Section 2, 5, 6, or 13 (or any definition or
provision in Section 14 to the extent it relates to, or is used
in or in connection with any such Section) shall be so held to be
invalid or unenforceable.
(m) Agreements: Furnish Specified Information. Section 4(a) is
hereby amended by adding at the end thereof the following
paragraph:
Notwithstanding the foregoing provisions of this Section
4(a), the parties agree that, pursuant to the terms of the
Power of Attorney with respect to Party A referred to in
Part 3(b) of this Schedule, any one or more of the officers
of Party A's general partner who has been designated as an
agent and attorney-in-fact of Party A will so deliver to
Party B or such government or taxing authority the
specified or requested forms, documents, or certificates;
provided, however, that in the event the requested form,
document, or certificate as delivered in the manner set
forth in this paragraph fails to satisfy the requirements
of law at any time, such failure will not be deemed a
breach or violation of this Section 4(a) or any other
provision of this Agreement.
(n) Trustee Representations. The Trustee represents (i) it is
executing this Agreement and each Transaction as trustee of Party
B and not in its individual capacity; (ii) the persons executing
this Agreement on its behalf have been authorized to do so; (iii)
that it has the power and authority to execute and deliver this
Agreement as trustee of Party B and to bind Party B and to act on
its behalf in all matters related to this Agreement.
(o) Transfer. Section 7 is replaced in its entirety by the
following:
"Subject to Section 6(b)(ii), neither this Agreement nor any
interest or obligation in or under this Agreement may be
transferred (whether by way of security or otherwise) by either
party without the prior written consent of the other party, which
consent will not be arbitrarily withheld or delayed, except that:
(a) a party may make such a transfer of this Agreement
pursuant to a consolidation or amalgamation with, or merger into,
or transfer of all or substantially all its assets to, or
reorganization, incorporation, reincorporation, or reconstitution
into or as, another entity (but without prejudice to any other
right or remedy under this Agreement);
(b) a party may make such a transfer of all or any part
of its interest in any amount payable to it from a Defaulting
Party under Section 6(e); and
(c) in addition to, and not in lieu of, the preceding
transfer rights, Party A may, without recourse, transfer this
Agreement (in whole and not in part only) to any of Party A's
Affiliates, provided that:
(i) Equivalent Creditworthiness: Either (A) such
transferee must have a long-term, unsecured, unsubordinated
debt obligation rating or financial program rating (or
other similar rating) by Standard & Poor's or Moody's or
any successor thereto which is at least equal to or greater
than the comparable long-term, unsecured, unsubordinated
debt obligation or financial program rating (or other
similar rating) of Party A immediately prior to such
transfer, or (B) the obligations transferred to such
transferee must be guaranteed by Party A pursuant to a
guaranty or other agreement or instrument mutually agreed
upon by both parties acting reasonably;
(ii) No Gross-up: Party B will not be required to
pay to the transferee an 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))
greater than the amount in respect of which Party B would
have been required to pay to Party A in the absence of such
transfer;
(iii) No Withholding: Party B will not receive a
payment from which an amount has been withheld or deducted,
on account of a Tax under Section 2(d)(i) (except in
respect of interest under Section 2(e), 6(d)(ii), or 6(e)),
which is less than that payment which Party A would have
been required to so make in the absence of such transfer,
unless the transferee would be required to make additional
payments pursuant to Section 2(d)(i)(4) corresponding to
such withholding or deduction;
(iv) Not Unlawful: It does not become unlawful for
either party to perform any obligation under this Agreement
as a result of such transfer; and
(v) No Event of Default: an Event of Default does
not occur as a result of such transfer.
With respect to the results described in clauses (ii) and (iii)
above, Party A will cause the transferee to make, and Party B
will make, such reasonable Payer Tax Representations and Payee
Tax Representations as may be mutually agreed upon by the
transferee and Party B in order to permit such parties to
determine that such results will not occur upon or after the
transfer.
Any purported transfer that is not in compliance with this
Section will be void."
(p) No Recourse. The Certificates (as defined in the Trust
Agreement) represent a beneficial interest in the property of the
Trust only and do not represent an interest in or obligation of
Party A, and no recourse may be had by the holders of the
Certificates against Party A or its assets with respect to the
Certificates and/or this Agreement.
(q) Regarding Party A. Party B acknowledges and agrees that Party A
had no involvement in, and, accordingly, accepts no
responsibility for: (i) the establishment, structure, or choice
of assets of the Trust or any Series; (ii) the selection of any
person performing services for or acting on behalf of the Trust
(other than Party A); (iii) the terms of the Certificates;
(iv) the preparation of or passing on the disclosure and other
information contained in any offering circular, prospectus,
series supplement, trust deed, or any other agreements or
documents used by any party in connection with the marketing and
sale of the Certificates (other than any information provided by
Party A for inclusion in any or to be used in connection with
such agreements or documents); (v) the ongoing operations and
administration of the Trust, including the furnishing of any
information to the Trust which is not specifically required under
this Agreement; or (vi) any other aspect of the Trust's existence
except for those matters specifically identified in this
Agreement.
Notwithstanding anything to the contrary herein, the satisfaction
of the current counterparty ratings requirements of Party A by
delivery of a letter immediately prior to or on the Effective
Date to Party A from Standard and Poor's or Moody's stating that
Party B's ability to meet its obligations hereunder is rated at
least A- or A3, respectively, shall be a condition precedent for
any and all of Party A's obligations under this Agreement.
The parties executing this Schedule have executed the Master
Agreement and have agreed as to the contents of this Schedule.
XXXXXXX SACHS MITSUI MARINE
DERIVATIVE PRODUCTS, L.P.
By: /s/ Xxxx Xxxxxxxxx
Name: Xxxx Xxxxxxxxx
Title: Managing Director
MBNA MASTER CREDIT CARD TRUST II
THE BANK OF NEW YORK, solely in its
capacity as trustee and not in its
individual capacity
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Assistant Treasurer
THE BANK OF NEW YORK, solely with
respect to Part 5(n), in its
individual capacity
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Assistant Treasurer
EXHIBIT A to Schedule
[Form of Opinion of Counsel for Party A.]
EXHIBIT B to Schedule
[Form of Opinion of Counsel for Trustee]
EXHIBIT C to Schedule
Date: September 23, 1999
To: The Bank of New York acting as
Trustee for the
MBNA Master Credit Card Trust II
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
From: Xxxxxxx Xxxxx Mitsui Marine Derivative Products, L.P.
Subject: Swap Transaction
The purpose of this communication is to set forth the terms
and conditions of the swap transaction entered into on the Trade Date
referred to below (the "Swap Transaction"), between THE BANK OF NEW
YORK (the "Trustee") acting as trustee for the MBNA MASTER CREDIT CARD
TRUST II ("Party B"), but only as relates to the Series 1999-J Class A
7.00% Certificates (the "Trust") and Xxxxxxx Xxxxx Mitsui Marine
Derivative Products, L.P. ("Party A"). This communication constitutes
a "Confirmation" as referred to in the Swap Agreement specified below.
This Confirmation supplements, forms part of, and is
subject to, the Master Agreement dated as of September 23, 1999,
between Party A and Party B (the "Master Agreement"). All provisions
contained in, or incorporated by reference to, such Master Agreement
shall govern this Confirmation except as expressly modified below.
This Confirmation and the Schedule to the Master Agreement
(the "Schedule") each incorporate the definitions and provisions
contained in (i) the 1991 ISDA Definitions (as published by the
International Swaps and Derivatives Association, Inc.) (the
"Definitions"), without regard to any amendment to the Definitions
subsequent to the date hereof, and (ii) the Series 1999-J Supplement
dated as of September 23, 1999 (the "Supplement") to the Pooling and
Servicing Agreement dated as of August 4, 1994 by and between MBNA
America Bank, National Association, as Seller and Servicer, and The
Bank of New York, as Trustee (as amended, the "Pooling and Servicing
Agreement", together with the Supplement, the "Trust Agreement"), and
relating to the Trust, Series 1999-J ("Series 1999-J") and, in
particular, for the purposes hereof, the Class A 7.00% Asset Backed
Certificates, Series 1999-J (the "Class A Certificates"). In the event
of any inconsistency between the definitions in the Supplement and any
of the Definitions, the Schedule or this Confirmation, the definitions
in the Supplement will govern; in the event of any inconsistency
between this Confirmation and either the Schedule or the Definitions,
this Confirmation will govern; and in the event of any inconsistency
between the Schedule and the Definitions, the Schedule will govern.
The terms of this particular Swap Transaction to which this
Confirmation relates are as follows:
Trade Date:-September 23, 1999
Effective Date:-The Closing Date for Series 1999-J.
Termination Date:-The Scheduled Payment Date; provided, however, that
in the event that the Rapid Amortization Period commences as a result
of a Trust Pay Out Event, the Termination Date will be the earlier of
(i) the date on which the Notional Amount is zero and (ii) the
Scheduled Payment Date.
Fixed Amounts:-
Fixed Rate Payer:-Party A.
Fixed Rate:-7.00%
Fixed Amount for Initial
Fixed Rate Payer Payment Date:-$8,594,444.44
Fixed Amount:-For each Fixed Rate Payer Payment Date other than the
initial Fixed Rate Payer Payment Date, an amount calculated on a
formula basis for that Fixed Rate Payer Payment Date as follows:
Fixed Rate
Fixed =NotionalxFixed
AmountAmount Rate
12
Fixed Rate Notional
Amount:-For the initial Fixed Rate Payer Payment Date, $850,000,000
(the initial outstanding principal balance of the Class A
Certificates), and for each Fixed Rate Payer Payment Date thereafter
the outstanding principal balance of Class A Certificates as of the
Record Date immediately preceding such Fixed Rate Payer Payment Date.
Fixed Rate Payer
Payment Dates:-Each Transfer Date.
Floating Amounts:-
Floating Rate Payer:-Party B.
Calculation Periods:-For the initial Floating Rate Payer Payment Date,
the period from and including the Effective Date through the day
preceding the first Distribution Date; for each Floating Rate Payer
Payment Date thereafter, each Calculation Period will be the period
from and including the previous Distribution Date through the day
preceding the current Distribution Date.
Floating Rate Payer
Payment Dates:-Each Transfer Date.
Floating Rate Option:-USD-LIBOR-BBA; provided, however, that the last
sentence of the definition of "USD-LIBOR-Reference Banks" is hereby
amended to replace the penultimate use of "that Reset Date" with "the
day that is two London Banking Days preceding that Reset Date."
Reset Dates:-Means, with respect to the initial Floating Rate Payer
Payment Date, the Effective Date, and with respect to each Floating
Rate Payer Payment Date thereafter, the first day of the related
Calculation Period for such Floating Rate Payer Payment Date.
Calculation Dates:-Means, with respect to each Floating Rate Payer
Payment Date, the first day of the related Calculation Period for such
Floating Rate Payer Payment Date.
Designated
Maturity:-For the initial Floating Rate Payer Payment Date, two month,
and for each Floating Rate Payer Payment Date thereafter, one month.
Floating Rate
Spread:-
Floating Rate
Notional Amount:-For the initial Floating Rate Payer Payment Date,
$850,000,000 (the initial outstanding principal balance of the Class A
Certificates), and for each Floating Rate Payer Payment Date thereafter
the outstanding principal balance of the Class A Certificates as of the
Record Date immediately preceding such Floating Rate Payer Payment
Date.
Floating Rate
Day Count Fraction:-Actual/360.
Compounding:-Not Applicable.
Calculation Agent:-Trustee.
Business Days:-New York and Newark, Delaware.
Credit Support Document:-Support Agreement dated as of October 8, 1993
among Party A, Mitsui Marine and Fire Insurance Co., Ltd. and The
Xxxxxxx Sachs Group, Inc.
Other Provisions:-If at any time during the Term of the Swap
Transaction Party A's long-term, unsecured, unsubordinated debt
obligation rating or financial program rating (or other similar rating)
is reduced below AA- by S&P, or is withdrawn by S&P, the Trustee at the
written instruction of the Servicer, on behalf of the Trust shall
establish and maintain with a Qualified Institution, in the name of the
Trust for the benefit of the Class A Certificateholders, the interest
reserve account as a segregated trust account held for the benefit of
Class A Certificateholders (the "Interest Reserve Account"). Within
thirty days of such reduction or withdrawal, provided that during such
thirty-day period such reduction or withdrawal remains in effect, Party
A shall fund the Interest Reserve Account in an amount equal to one-
twelfth of the product of (a) the Fixed Rate, and (b) the outstanding
principal balance of the Class A Certificates on the Record Date
preceding such reduction or withdrawal for reinvestment in accordance
with the Supplement; provided, however, that if subsequent to such
deposit Party A receives evidence satisfactory to it that such
reduction or withdrawal ceases to exist, any amount on deposit in the
Interest Reserve Account shall be returned to Party A on the subsequent
Transfer Date. The failure of Party A to adequately fund the Interest
Reserve Account within thirty days of such reduction or withdrawal
shall not constitute an Event of Default pursuant to the provisions of
subsection 5(a) or a Termination Event pursuant to the provisions of
subsection 5(b). Party A and Party B shall treat the amount on deposit
in the Interest Reserve Account as Party A's (or an affiliate
thereof's) money for tax purposes. After establishment of the Interest
Reserve Account, in the event there shall occur an Early Termination
Date as a result of an Event of Default with respect to Party A as the
Defaulting Party or a Termination Event with respect to Party A as the
Affected Party, the funds then contained in the Interest Reserve
Account will be deposited into the Finance Charge Account to the extent
provided in the Supplement. Upon termination of the Interest Reserve
Account as provided in the Supplement after payment of all amounts
owing to the Series 1999-J Certificateholders that are payable from
such account, the Trustee will release all amounts on deposit therein
to Party A.
-If Party B notifies Party A that netting of payments will not apply to
any of the Transactions pursuant to Part 4(i) of the Schedule, each
payment obligation of Party B under Section 2(a)(i) of the Master
Agreement in respect of this Swap Transaction shall be subject to the
condition precedent that in respect of each such payment obligation
each amount payable by Party A with respect to this Swap Transaction
shall be paid by Party A on the relevant Fixed Rate Payer Payment Date
or at such time as is mutually consented to by Party A and Party B,
such consent not to be unreasonably withheld by either party.
Banking Day:-New York, New York and London, England.
Governing Law: -New York.
Offices:-Party A is not a Multibranch Party.
-Party B is not a Multibranch Party.
Payment Instructions
for Party A USD:-Xxxxxxx Xxxxx Mitsui Marine
Derivatives Products, L.P.
c/o 00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
ABA# 000-000-000
For the account of Xxxxxxx Sachs Mitsui Marine Derivative Products,
L.P.
A/C# 9301034733
Payment Instructions
for the Trust in USD:
-Bank of New York, New York ABA# 000000000
A/C of MBNA Master Credit Card Trust II
Series 1999-J
A/C# 234381
Please confirm that the foregoing correctly sets forth the terms
of our agreement with respect to the Swap Transaction by signing in the
space provided below and sending a copy of the executed Confirmation to
us.
It has been a pleasure working with you on this transaction and
we look forward to working with you again in the future.
Very truly yours,
XXXXXXX XXXXX MITSUI MARINE
DERIVATIVE PRODUCTS, L.P.
By: ___________________________
Name:
Title:
Agreed and Accepted by:
MBNA MASTER CREDIT CARD TRUST II,
THE BANK OF NEW YORK, solely
in its capacity as trustee and not
in its individual capacity
By: ___________________________
Name:
Title:
Date: September 23, 1999
To: The Bank of New York acting as
Trustee for the
MBNA Master Credit Card Trust II
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
From: Xxxxxxx Sachs Mitsui Marine Derivative Products, L.P.
Subject: Swap Transaction
The purpose of this communication is to set forth the terms
and conditions of the swap transaction entered into on the Trade Date
referred to below (the "Swap Transaction"), between THE BANK OF NEW
YORK (the "Trustee") acting as trustee for the MBNA MASTER CREDIT CARD
TRUST II ("Party B"), but only as relates to the Series 1999-J Class A
7.00% Certificates (the "Trust") and Xxxxxxx Xxxxx Mitsui Marine
Derivative Products, L.P. ("Party A"). This communication constitutes
a "Confirmation" as referred to in the Swap Agreement specified below.
This Confirmation supplements, forms part of, and is
subject to, the Master Agreement dated as of September 23, 1999,
between Party A and Party B (the "Master Agreement"). All provisions
contained in, or incorporated by reference to, such Master Agreement
shall govern this Confirmation except as expressly modified below.
This Confirmation and the Schedule to the Master Agreement
(the "Schedule") each incorporate the definitions and provisions
contained in (i) the 1991 ISDA Definitions (as published by the
International Swaps and Derivatives Association, Inc.) (the
"Definitions"), without regard to any amendment to the Definitions
subsequent to the date hereof, and (ii) the Series 1999-J Supplement
dated as of September 23, 1999 (the "Supplement") to the Pooling and
Servicing Agreement dated as of August 4, 1994 by and between MBNA
America Bank, National Association, as Seller and Servicer, and The
Bank of New York, as Trustee (as amended, the "Pooling and Servicing
Agreement", together with the Supplement, the "Trust Agreement"), and
relating to the Trust, Series 1999-J ("Series 1999-J") and, in
particular, for the purposes hereof, the Class A 7.00% Asset Backed
Certificates, Series 1999-J (the "Class A Certificates"). In the event
of any inconsistency between the definitions in the Supplement and any
of the Definitions, the Schedule or this Confirmation, the definitions
in the Supplement will govern; in the event of any inconsistency
between this Confirmation and either the Schedule or the Definitions,
this Confirmation will govern; and in the event of any inconsistency
between the Schedule and the Definitions, the Schedule will govern.
The terms of this particular Swap Transaction to which this
Confirmation relates are as follows:
Trade Date:-September 23, 1999
Effective Date:-The Closing Date for Series 1999-J.
Termination Date:-The Scheduled Payment Date; provided, however, that
in the event that the Rapid Amortization Period commences as a result
of a Trust Pay Out Event, the Termination Date will be the earlier of
(i) the date on which the Notional Amount is zero and (ii) the
Scheduled Payment Date.
Fixed Amounts:-
Fixed Rate Payer:-Party A.
Fixed Rate:-7.00%
Fixed Amount for Initial
Fixed Rate Payer Payment Date:-$8,594,444.44
Fixed Amount:-For each Fixed Rate Payer Payment Date other than the
initial Fixed Rate Payer Payment Date, an amount calculated on a
formula basis for that Fixed Rate Payer Payment Date as follows:
Fixed Rate
Fixed =NotionalxFixed
AmountAmount Rate
12
Fixed Rate Notional
Amount:-For the initial Fixed Rate Payer Payment Date, $850,000,000
(the initial outstanding principal balance of the Class A
Certificates), and for each Fixed Rate Payer Payment Date thereafter
the outstanding principal balance of Class A Certificates as of the
Record Date immediately preceding such Fixed Rate Payer Payment Date.
Fixed Rate Payer
Payment Dates:-Each Transfer Date.
Floating Amounts:-
Floating Rate Payer:-Party B.
Calculation Periods:-For the initial Floating Rate Payer Payment Date,
the period from and including the Effective Date through the day
preceding the first Distribution Date; for each Floating Rate Payer
Payment Date thereafter, each Calculation Period will be the period
from and including the previous Distribution Date through the day
preceding the current Distribution Date.
Floating Rate Payer
Payment Dates:-Each Transfer Date.
Floating Rate Option:-USD-LIBOR-BBA; provided, however, that the last
sentence of the definition of "USD-LIBOR-Reference Banks" is hereby
amended to replace the penultimate use of "that Reset Date" with "the
day that is two London Banking Days preceding that Reset Date."
Reset Dates:-Means, with respect to the initial Floating Rate Payer
Payment Date, the Effective Date, and with respect to each Floating
Rate Payer Payment Date thereafter, the first day of the related
Calculation Period for such Floating Rate Payer Payment Date.
Calculation Dates:-Means, with respect to each Floating Rate Payer
Payment Date, the first day of the related Calculation Period for such
Floating Rate Payer Payment Date.
Designated
Maturity:-For the initial Floating Rate Payer Payment Date, two month,
and for each Floating Rate Payer Payment Date thereafter, one month.
Floating Rate
Spread:-
Floating Rate
Notional Amount:-For the initial Floating Rate Payer Payment Date,
$850,000,000 (the initial outstanding principal balance of the Class A
Certificates), and for each Floating Rate Payer Payment Date thereafter
the outstanding principal balance of the Class A Certificates as of the
Record Date immediately preceding such Floating Rate Payer Payment
Date.
Floating Rate
Day Count Fraction:-Actual/360.
Compounding:-Not Applicable.
Calculation Agent:-Trustee.
Business Days:-New York and Newark, Delaware.
Credit Support Document:-Support Agreement dated as of October 8, 1993
among Party A, Mitsui Marine and Fire Insurance Co., Ltd. and The
Xxxxxxx Sachs Group, L.P.
Other Provisions:-If at any time during the Term of the Swap
Transaction Party A's long-term, unsecured, unsubordinated debt
obligation rating or financial program rating (or other similar rating)
is reduced below AA- by S&P, or is withdrawn by S&P, the Trustee at the
written instruction of the Servicer, on behalf of the Trust shall
establish and maintain with a Qualified Institution, in the name of the
Trust for the benefit of the Class A Certificateholders, the interest
reserve account as a segregated trust account held for the benefit of
Class A Certificateholders (the "Interest Reserve Account"). Within
thirty days of such reduction or withdrawal, provided that during such
thirty-day period such reduction or withdrawal remains in effect, Party
A shall fund the Interest Reserve Account in an amount equal to one-
twelfth of the product of (a) the Fixed Rate, and (b) the outstanding
principal balance of the Class A Certificates on the Record Date
preceding such reduction or withdrawal for reinvestment in accordance
with the Supplement; provided, however, that if subsequent to such
deposit Party A receives evidence satisfactory to it that such
reduction or withdrawal ceases to exist, any amount on deposit in the
Interest Reserve Account shall be returned to Party A on the subsequent
Transfer Date. The failure of Party A to adequately fund the Interest
Reserve Account within thirty days of such reduction or withdrawal
shall not constitute an Event of Default pursuant to the provisions of
subsection 5(a) or a Termination Event pursuant to the provisions of
subsection 5(b). Party A and Party B shall treat the amount on deposit
in the Interest Reserve Account as Party A's (or an affiliate
thereof's) money for tax purposes. After establishment of the Interest
Reserve Account, in the event there shall occur an Early Termination
Date as a result of an Event of Default with respect to Party A as the
Defaulting Party or a Termination Event with respect to Party A as the
Affected Party, the funds then contained in the Interest Reserve
Account will be deposited into the Finance Charge Account to the extent
provided in the Supplement. Upon termination of the Interest Reserve
Account as provided in the Supplement after payment of all amounts
owing to the Series 1999-J Certificateholders that are payable from
such account, the Trustee will release all amounts on deposit therein
to Party A.
-If Party B notifies Party A that netting of payments will not apply to
any of the Transactions pursuant to Part 4(i) of the Schedule, each
payment obligation of Party B under Section 2(a)(i) of the Master
Agreement in respect of this Swap Transaction shall be subject to the
condition precedent that in respect of each such payment obligation
each amount payable by Party A with respect to this Swap Transaction
shall be paid by Party A on the relevant Fixed Rate Payer Payment Date
or at such time as is mutually consented to by Party A and Party B,
such consent not to be unreasonably withheld by either party.
Banking Day:-New York, New York and London, England.
Governing Law: -New York.
Offices:-Party A is not a Multibranch Party.
-Party B is not a Multibranch Party.
Payment Instructions
for Party A USD:-Xxxxxxx Xxxxx Mitsui Marine
Derivatives Products, L.P.
c/o 00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
ABA# 000-000-000
For the account of Xxxxxxx Sachs Mitsui Marine Derivative Products,
L.P.
A/C# 9301034733
Payment Instructions
for the Trust in USD:
-Bank of New York, New York ABA# 000000000
A/C of MBNA Master Credit Card Trust II
Series 1999-J
A/C# 234381
Please confirm that the foregoing correctly sets forth the terms
of our agreement with respect to the Swap Transaction by signing in the
space provided below and sending a copy of the executed Confirmation to
us.
It has been a pleasure working with you on this transaction and
we look forward to working with you again in the future.
Very truly yours,
XXXXXXX XXXXX MITSUI MARINE
DERIVATIVE PRODUCTS, L.P.
By: /s/ Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President
Agreed and Accepted by:
MBNA MASTER CREDIT CARD TRUST II,
THE BANK OF NEW YORK, solely
in its capacity as trustee and not
in its individual capacity
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Assistant Treasurer
2 ISDAr 1992
