exv10w11



 





Exhibit 10.11




(Multicurrency—Cross Border)









International Swap Dealers Association, Inc.




MASTER AGREEMENT




dated as of April 27, 2007




	 	 	 	 	 
	WELLS FARGO BANK, N.A.

	 	and
	 	SMART MODULAR TECHNOLOGIES

(WWH), INC.,





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



Copyright © 1992 by International Swap Dealers Association, Inc.





 









 









precedent
specified in this Agreement.




(b) Change of Account. Either party may change its account for receiving a payment or
delivery by giving notice to the other party at least five Local Business Days prior to the
scheduled date for the payment or delivery to which such change applies unless such other
party gives timely notice of a reasonable objection to such change.



(c) Netting. If on any date amounts would otherwise be payable:—





(i) in the same currency; and




(ii) in respect of the same Transaction,


by each party to the other, then, on such date, each party’s obligation to make payment of any
such amount will be automatically satisfied and discharged and, if the aggregate amount that would
otherwise have been payable by one party exceeds the aggregate amount that would otherwise have
been payable by the other party, replaced by an obligation upon the party by whom the larger
aggregate amount would have been payable to pay to the other party the excess of the larger
aggregate amount over the smaller aggregate amount.



The parties may elect in respect of two or more Transactions that a net amount will be determined
in respect of all amounts payable on the same date in the same currency in respect of such
Transactions, regardless of whether such amounts are payable in
respect of the same Transaction.
The election may be made in the Schedule or a Confirmation by specifying that subparagraph (ii)
above will not apply to the Transactions identified as being subject to the election, together with
the starting date (in which case subparagraph (ii) above will not, or will cease to, apply to such
Transactions from such date). This election may be made separately for different groups of
Transactions and will apply separately to each pairing of Offices through which the parties make
and receive payments or deliveries.




(d)
Deduction or Withholding for Tax.





(i)
Gross-Up. All payments under this Agreement will be made without any deduction or
withholding for or on account of any Tax unless such deduction or withholding is required
by any applicable law, as modified by the practice of any relevant governmental revenue
authority, then in effect. If a party is so required to deduct or withhold, then that
party (“X”) will:—




(1) promptly notify the other party (“Y”) of such requirement;




(2) pay to the relevant authorities the full amount required to be deducted or
withheld(including the full amount required to be deducted or withheld from any
additional amount paid by X to Y under this Section 2(d)) promptly upon the earlier of
determining that such deduction or withholding is required or receiving notice that
such amount has been assessed against Y;




(3) promptly forward to Y an official receipt (or a certified copy), or other
documentation reasonably acceptable to Y, evidencing such payment to such authorities;
and




(4) if such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment to which
Y is otherwise entitled under this Agreement, such additional amount as is necessary to
ensure that the net amount actually received by Y (free and clear of Indemnifiable
Taxes, whether assessed against X or Y) will equal the full amount Y would have
received had no such deduction or withholding been required. However, X will not be
required to pay any additional amount to Y to the extent that it would not be required
to be paid but for: —




(A) the failure by Y to comply with or perform any agreement contained in
Section 4(a)(i), 4(a)(iii) or 4(d); or




(B) the failure of a representation made by Y pursuant to Section 3(f) to be
accurate and true unless such failure would not have occurred but for
(I) any action taken by a taxing authority, or brought in a court of competent
jurisdiction, on or after the date on which a transaction is entered into
(regardless of whether such action is taken or brought with



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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 am 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 Representation.





(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
authorise such execution, delivery and performance;




(iii) No Violation or Conflict. Such execution, delivery and performance do not violate or
conflict with any law applicable to it, any provision of its constitutional documents, any
order or judgment of any court or other agency of government applicable to it or any of
its assets or any contractual restriction binding on or affecting it or any of its assets;




(iv) Consents. All governmental and other consents that are required to have been obtained
by it with respect to this Agreement or any Credit Support Document
to which it is a party
have been obtained and are in full force and effect and all conditions of any such consents
have been complied with; and




(v) Obligations Binding. Its obligations under this Agreement and any Credit Support
Document to which it is a party constitute its legal, valid and binding obligations,
enforceable in accordance with their respective terms (subject to applicable bankruptcy,
reorganisation, insolvency, moratorium or similar laws affecting creditors’ rights
generally and subject, as to enforceability, to equitable principles of general application
(regardless of whether enforcement is sought in a proceeding in



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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
respect.



(e) Payer Tax Representation. Each representation specified in the Schedule as being made by it for
the purpose of this Section 3(e) is accurate and true.



(f) Payee Tax Representations. Each representation specified in the Schedule as being made by it
for the purpose of this Section 3(f) is accurate and true.




4. Agreements



Each party agrees with the other that, so long as either party has or may have any obligation
under this Agreement or under any Credit Support Document to which it is a party:—



(a) Furnish Specified Information. It will deliver to the other party or, in certain cases under
subparagraph (iii) below, to such government or taxing authority as the other parry 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 fee legal or commercial
position of the party in receipt of such demand), with any such form or document to be
accurate and completed in a manner reasonably satisfactory to such other party and to be
executed and to be delivered with any reasonably required certification,


in each case by the date specified in the Schedule or such Confirmation or, if none is specified,
as soon as reasonably practicable,



(b) Maintain Authorisations. It will use all reasonable efforts to maintain in full force and
effect ail consents of any governmental or other authority that are required to be obtained by it
with respect to this Agreement or any Credit Support Document to which it is a party and will use
all reasonable efforts to obtain any that may become necessary in the future.



(c) Comply with Laws. It will comply in all material respects with all applicable laws and orders
to which it may be subject if failure so to comply would materially impair its ability to perform
its obligations under this Agreement or any Credit Support Document to which it is a party.



(d) Tax Agreement. It will give notice of any failure of a representation made by it
under Section 3(f) tobe accurate and true promptly upon learning of such failure.




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(e) Payment of Stamp Tax. Subject to Section 11, it will pay any Stamp Tax levied or imposed upon
it or in respect of its execution or performance of this Agreement by a jurisdiction in which it is
incorporated, organised, managed and controlled, or considered to have its seat, or in which a
branch or office through which it is acting for the purpose of this Agreement is located (“Stamp
Tax Jurisdiction”) and will indemnify the other party against any Stamp Tax levied or imposed upon
the other party or in respect of the other party’s execution or performance of this Agreement by
any such Stamp Tax Jurisdiction which is not also a Stamp Tax Jurisdiction with respect to the
other party.




5. Events of Default and Termination Events



(a) Events of Default. The occurrence at any time with respect to a party or, if applicable, any
Credit Support Provider of such party or any Specified Entity of such party of any of the
following events constitutes an event of default (an “Event of Default”) with respect to such
party:—





(i) Failure to Pay or Deliver. Failure by the party to make, when due, any payment under
this Agreement or delivery under Section 2(a)(i) or 2(e) required to be made by it if such
failure is not remedied on or before the third Local Business Day after notice of such
failure is given to the party;




(ii) Breach of Agreement. Failure by the party to comply with or perform any agreement or
obligation (other than an obligation to make any payment under this Agreement or delivery
under Section 2(a)(i) or 2(e) or to give notice of a Termination Event or any agreement or
obligation under Section 4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by
the party in accordance with this Agreement if such failure is not remedied on or before
the 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 raider 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



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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 wading-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



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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 Parry) 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 to 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.




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6. Early Termination



(a) Right to Terminate Following Event of Default. If at any time an Event of Default with respect
to a party (the “Defaulting Party”) has occurred and is then continuing, the other party (the
“Non-defaulting Party”) may, 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)(4) or, to the extent analogous thereto, (8).




(b) Right to Terminate Following Termination Event.





(i) Notice. If a Termination Event occurs, an Affected Patty 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)(l) 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
al! Affected Transactions.



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(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



ISDA ® 1992





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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-defaultiag 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).



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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 fails short of
the amount in the Contractual Currency payable in respect of this Agreement, the party required to
make the payment will, to the extent permitted by applicable law, immediately pay such additional amount in the
Contractual Currency as may be necessary to compensate for the shortfall. If for any reason the amount in
the Contractual Currency so received exceeds the amount in the Contractual Currency payable in respect of this
Agreement, the party receiving the payment will refund promptly the amount of such excess.



(b) 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 to 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.



(d) Evidence of Loss. For me 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



ISDA ® 1992



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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 organisation 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;


 ISDA ® 1992



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(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 that delivery (or attempted delivery) or that receipt, as applicable, is not a
Local Business Day or that communication is delivered (or attempted) or received, as applicable,
after the close of business on a Local Business Day, in which case that communication shall be
deemed given and effective on the first following day that is a Local Business Day.



(b) Change of Addresses. Either party may by notice to the other change the address, telex
or facsimile number or electronic messaging system details at which notices or other communications
are to be given to it.




13. Governing Law and Jurisdiction



(a) Governing Law. This Agreement will be governed by and construed in accordance with the law
specified in the Schedule.



(b) Jurisdiction. With respect to any suit, action or proceedings relating to this
Agreement (“Proceedings”), each party irrevocably:—





(i) submits to the jurisdiction of the English courts, if this Agreement is expressed to
be governed by
English law, or to the non-exclusive jurisdiction of the courts of the State of New York
and the United States District Court located in the Borough of Manhattan in New York City,
if this Agreement is expressed to be governed by the laws of the State of New York; and




(ii) waives any objection which it may have at any time to the laying of venue of any
Proceedings brought in any such court, waives any claim that such Proceedings have been
brought in an inconvenient forum, and further waives the right to object, with respect to
such Proceedings, that such court does not have any jurisdiction over such party.


Nothing in this Agreement precludes either party from bringing Proceedings in any other
jurisdiction (outside, if this Agreement is expressed to be governed by English law, the
Contracting States, as defined in Section 1(3) of the Civil Jurisdiction and Judgments Act 1982 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.


ISDA ® 1992




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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, authorisation, exemption, notice, filing,
registration or exchange control consent.



“Credit Event Upon Merger” has the meaning specified in Section 5(b).



“Credit Support Document” means any agreement or instrument that is specified as such in this
Agreement.



“Credit Support Provider” has the meaning specified in the Schedule.



“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).



“Indemniflable 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



ISDA ® 1992



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(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 parry, 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)(l) 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 parry) 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 to good faith by the party obliged
to make a determination under Section 6(e), and, if each parry 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



ISDA ® 1992



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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, organised, managed and controlled or considered to have its seat, (b) where an
Office through which the party is acting for purposes of this Agreement is located, (c) in which
the party executes this Agreement and (d) in relation to any payment, from or through which such
payment is made.



“Scheduled Payment Date” means a date on which a payment or delivery is to be made under 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 me 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.


ISDA ® 1992




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“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.


ISDA ® 1992



17









 







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.




	 	 	 	 	 	 	 	
	WELLS FARGO BANK, N.A.	 	 	SMART MODULAR TECHNOLOGIES (WWH), INC.
	 
	By:  
	/s/ Susan K. Payunk 
	 	 	By:  	/s/ Jack Pacheco 

	

Name: Susan K. Payunk

Its: Authorized Signatory

	 	 
	

Name: Jack Pacheco

Its: Vice President & CFO





ISDA ® 1992




18









 





SCHEDULE



to the




ISDA MASTER AGREEMENT




     This is the Schedule to that certain ISDA Master Agreement dated as of April 27, 2007
between WELLS FARGO BANK, N.A.(“Parry A”) and SMART MODULAR TECHNOLOGIES (WWH), INC. (“Party
B”).



PART1




Termination Provisions



In this Agreement:




     (A) “Specified Entity” does not apply in relation to Party A and means in relation to Party B,
any “Obligor” and any “Subsidiary”, as defined in the Loan Agreement.



     (B) “Specified Transaction” will have the meaning specified in Section 14 of this
Agreement.



     (C) The “Cross-Default” provisions of Section 5(a)(vi) of this Agreement will apply to Party A
and Party B.



          “Specified Indebtedness” will have the meaning specified in Section 14 and shall include (i)
any amount due and payable in respect of any Specified Transaction (except that, for this purpose
only, the words “and any other entity” shall be substituted for the words “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)” where they appear in the definition of Specified Transaction) and
(ii) other indebtedness and other obligations, fixed or contingent, for the payment of money,
owing by Party B to Party A (in its individual or other capacity).



          “Threshold Amount” means with respect to Party A, an amount equal to 3% of the Shareholders
Equity (as hereinafter defined) of Party A and with respect to Party B, any Credit Support
Provider of Party B and any Specified Entity of Party B, $5,000,000.00.



          “Shareholders’ Equity” means, with respect to an entity, at any time, the sum (as shown in
its most recent annual audited financial statements) of (i) its capital stock (including preferred
stock outstanding, taken at par value), (ii) its capital surplus and (iii) its retained earnings,
minus (iv) treasury stock, each to be determined in accordance with generally accepted accounting
principles.



     (D) The “Credit Event Upon Merger” provisions of Section 5(b)(iv) of this Agreement
will apply to Party A and Party B.



     (E) The “Automatic Early Termination” provision of Section 6(a) of this Agreement will
not apply to Party A or to Party B.



     (F) Payments on Early Termination. For the purpose of Section 6(e) of this Agreement:
(i) Market Quotation will apply, and (ii) Second Method will apply.



     (G) “Termination Currency” means United States Dollars.



19









 





     (H) Additional Termination Event will apply. The following shall constitute an
Additional Termination Event:




     (i) All “Obligations” under and as defined in that Second and Amended Loan and Security
Agreement dated April 30, 2007 by and among Smart Modular Technologies, Inc., Smart Modular
Technologies (Europe) Limited, and Smart Modular Technologies (Puerto Rico) Inc., as
Borrowers, the other Obligors named therein, the Lenders that are signatories thereto, as
the Lenders and Party A as the Arranger, Administrative Agent and Security Trustee (as
amended, supplemented, modified, renewed, replaced, extended, restated, consolidated or
substituted from time to time, the “Loan Agreement”) (other than “Bank Product Obligations”,
as so defined) shall be paid and satisfied and all commitments by the “Lenders” (as so
defined) to extend further credit shall be terminated, or there shall exist any “Event of
Default” under and as defined in such Loan Agreement;




     (ii) Party A is no longer a Lender and the Arranger and Administrative Agent under the
Loan Agreement; or




     (iii) Upon failure of Party B to comply with Part 3 of this Agreement.


Party B shall be the sole Affected Party for purposes of Part l(H)(i), (ii) and
(iii).




PART 2




Tax Representations




     (A) Payer Representations. For the purpose of Section 3(e) of this Agreement,
each party makes 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
Section 2(e), 6(d)(ii) or 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
representations made by the other party pursuant to Section 3(f) of this Agreement, (ii)
the satisfaction of the agreement contained in Section 4(a)(i) 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) or 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 or document under Section 4(a)(iii) by
reason of material prejudice to its legal or commercial position.



(B) Payee Representations.





(i) For the purpose of Section 3(f) of this Agreement, Party A makes the following representation to Party B:




It is a national banking association established under the laws of the United States of
America.




(ii) For the purpose of Section 3(f) of this Agreement, Party B makes the following
representations to Party A:




Party B is a corporation organized under the laws of the Cayman Islands and is classified as
a corporation for U.S. federal income tax purposes.



20









 






Party B is a “non-U.S. branch of a foreign person” for the purpose of U.S. Treasury
Regulation Section 1.1441-4(a)(3)(ii) and a “foreign person” for the purpose of U.S.
Treasury Regulation Section 1.6041-4(a)(4).




Parry B is not a bank that has entered into this Agreement in the ordinary course of a
trade or business of making loans, as described in Section 88l(c)(3)(A) of the Internal
Revenue Code of 1986, as amended (the “Code”).



PART 3




Agreement to Deliver Documents




     For the purposes of Section 4(a)(i) and (ii) of this Agreement, the parties agree that the
following documents will be delivered:



	 	 	 	 	 	 	 
	Party Required to	 	 	 	 	 	Covered by Section 3(d) 
	Deliver Document	 	Form/Document/Certificate 	 	Date by which to be delivered 	 	Representation 
	 
	Party B and Party
A

	 	Resolution adopted by the Board of
Directors, certified by the Secretary
or an Assistant Secretary,
authorizing
the execution, delivery and
performance of this Agreement and
each Confirmation
	 	Within 60 days from the
date of this Agreement
	 	Yes
	 
	 	 	 	 	 	 
	Party B and Party A

	 	Specimen signature certificate of the
Secretary or an Assistant Secretary,
setting out names and specimen
signatures of each person or persons
authorized on behalf of the party to
execute and deliver this Agreement
and each Confirmation
	 	Within 60 days from the
date of this Agreement
	 	Yes
	 
	 	 	 	 	 	 
	Party B 

	 	The Credit Support documents), if

any, listed in Part 4, Section (F)
	 	Concurrent with the
execution of this
Agreement
	 	Yes
	 
	Party B

	 	IRS Form W-8BEN, or any
successor form thereto
	 	Concurrent with the
execution of this
Agreement, promptly
upon
reasonable demand by
Party A and promptly
upon
learning that any such
form
previously provided by
Party B has become
obsolete or incorrect.
	 	Yes
	 
	 	 	 	 	 	 
	Party B

	 	Additional information with respect
to Party B as Party A may reasonably
request from time to time
	 	Promptly upon request
	 	Yes






21









 





PART 4




Miscellaneous





(A) Addresses for Notices. For the purpose of Section 12(a) of this
Agreement:




Address for notices or communications to Party B:



	 	 	 	 	 	 	 
	 

	 	Address:
	 	SMART Modular Technologies (WWH), Inc.

4211 Starboard Drive 

Fremont, CA 94538 

Fax: 510 360-8500 

Telephone: (510)624-8134 

Attention: Jack Pacheco, Chief Financial Officer 

E-mail Address:jack.pacheco@smartm.com
	 	 








Address for notices or communications to Party A:



	 	 	 	 	 	 	 
	 

	 	Address:
	 	Wells Fargo Bank, N.A. 

Financial Products (AU # 1857) 

550 California Street, 12th Floor 

MAC A0112-121 

San Francisco, California 94104 

Telecopy No.: (415)986-2604

Confirmation No.: (415)222-3847 

Attention: Documentation Group
	 	 







Additional Address for notices or communications for operational purposes (payments and settlements):



	 	 	 	 	 	 	 
	 

	 	Address:
	 	Wells Fargo Bank, N.A. 

550 California Street, 12th Floor 

MAC A0112-121 

San Francisco, California 94104 

Facsimile No.: (415) 646-9208 

Attention: Back Office Operations - Settlements
	 	 






     (B) Process Agent. For the purpose of Section 13(c) of the Agreement, neither Party A
nor Party B will appoint a Process Agent.




	 	(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 Party A.
	 
	 	(F)	 	Credit Support Document.
	 
	 	 	 	Credit Support Document means, in relation to Party A: None.





22









 






Credit Support Document means, in relation to Party B:




(i) the Loan Documents, as the same may be amended, supplemented, modified,
renewed, replaced, consolidated, restated, substituted or extended from time to
time, as defined in the Loan Agreement; and




(ii) the Loan Agreement as defined herein, as the same may be amended,
supplemented, modified, renewed, replaced, consolidated, restated, substituted or
extended from time to time.



     Party B agrees that the collateral securing the obligations of Party B to Lenders described
in the Credit Support Document(s) shall also secure the obligations of Party B to Party A under
this Agreement.



     The Credit Support Document(s) (as amended from time to time) are incorporated herein and form
a part of this Agreement to the extent that such Credit Support Document(s) relate to the
Transactions governed by this Agreement.



     (G) Credit Support Provider.




  Credit Support Provider means in relation to Party A: None.



  Credit Support Provider means in relation to Party B: All “Guarantors”, as defined in the
Loan Agreement.



     (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.



     (I) Netting of Payments. Subparagraph (ii) of Section 2(c) of this Agreement
will apply to the Transactions.



     (J) “Affiliate” will have the meaning specified in Section 14 of this Agreement and
shall exclude any broker/dealer affiliates with respect to Party A,



PART 5




Other Provisions




     (A) Confirmations. Notwithstanding anything to the contrary in this Agreement:




     (i) The parties hereto agree that with respect to each Transaction hereunder a legally
binding agreement shall exist from the moment that the parties hereto agree on the
essential terms of such Transaction, which the parties anticipate will occur by telephone.




     (ii) For each Transaction Party A and Party B agree to enter into hereunder, Party A
shall promptly send to Party B a Confirmation setting forth the terms of such Transaction.
Party B shall execute and return the Confirmation to Party A or request correction of any
error within three Business Days of receipt. Failure of Party B to respond within such
period shall not affect the validity or enforceability of such Transaction and shall be
deemed to be an affirmation of such terms.



     (B) Definitions. For each Transaction (unless otherwise specified in the relevant
Confirmation for that Transaction) all provisions of the 2000 ISDA Definitions (as published by the International
Swaps & Derivatives Association, Inc.), including the Annex to the 2000 ISDA Definitions, are hereby incorporated
by mis reference into this Agreement and shall form a part hereof as if set forth in full herein.



23









 





     (C) Notice of Event of Default. Party B agrees, upon learning of the occurrence of
any event or commencement of any condition that constitutes (or that with the giving of notice or passage
of time or both would constitute) an Event of Default with respect to Party B, promptly to give Party A notice of
such event or condition.



     (D) Additional Representations. Section 3 of this Agreement is hereby amended by
adding at the end thereof the following subsections (g) through (1) and pursuant to subsections (i) and (ii)
below:




“(g) Eligible Contract Participant. It is either an “eligible contract participant” as that
term is defined in Section la(12) of the Commodity Exchange Act (7 U.S.C. la(12)) and was
not formed solely for the purposes of constituting an “eligible contract participant, or if
it is not an eligible contract participant, this Agreement (including each Transaction) is
undertaken in conjunction with its line of business (including financial intermediation
services) or the financing of its business.”




“(h) No Agency. It is entering into this Agreement, any Credit Support Document to which it
is a party, each Transaction and any other documentation relating to this Agreement or any
Transaction as principal (and not as agent or in any other capacity, fiduciary or
otherwise).”




“(i) Creditworthiness. The economic terms of this Agreement, and any Credit Support
Documents to which it is a party, and each Transaction have been individually tailored and
negotiated by it, and the creditworthiness of the other party was a material consideration
in its entering into or determining the terms of this Agreement, such Credit Support
document, and such Transaction.”




“(j) Individual Negotiation. This Agreement (including each Transaction) has been subject
to individual negotiation by the parties, including individualized creditworthiness
determinations.”




“(k) 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 and each
Transaction hereunder. It is also capable of assuming, and assumes, the risks of this
Agreement and each Transaction hereunder.”




“(l) Non-Reliance. It is acting for its own account, and it has made its own independent
decisions to enter into that Transaction and as to whether that Transaction 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 that Transaction: it being
understood that information and explanations related to the terms and conditions of a
Transaction shall not be considered investment advice or a recommendation to enter into a
Transaction. No communication (written or oral) received from the other party shall be
deemed to be an assurance or guarantee of the expected results of that Transaction.”




     (i) Section 3(a)(iii) of this Agreement is amended by inserting the word “material”
immediately prior to the word “contractual” in the third line thereof.




     (ii) Section 3(d) of this Agreement is amended to read in its entirety as
follows:




“(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 purposes of this
Section 3(d) to this Agreement does not contain, when taken as a whole and as of its date, a
misstatement of material feet or omits to state a material fact required to be stated in
order to make the statements therein contained not misleading in the light of circumstances
under which made.”




(E) Right of Setoff. Section 6 of this Agreement is amended by adding the following
new Section 6(f);




“(f) Set-off. Any amount (the “Early Termination Amount”) payable under Section
6(e) by one party (“Party X”) to the other party that is either the Defaulting Party
or the one Affected Party (“Party Y”), will, at the option of Party X (and without
prior notice to Party Y), be reduced by its set-off against any amount(s) (the “Other
Agreement Amount “) payable (whether at such time or in the future or upon the
occurrence of a contingency) by Party Y to Party X (irrespective of the



24









 






currency, place of payment or booking office of the obligation) under any other
agreement(s) between Party X and Party Y or instrument(s) or undertaking(s) issued
or executed by one party to, or in favor of, the other party (and the Other
Agreement Amount will be discharged promptly and in all respects to the extent it is
so set-off). Party X will give notice to the other party of any set-off effected
under this Section 6(f).




For this purpose, either the Early Termination Amount or the Other Agreement Amount
(or the relevant portion of such amounts) may be converted by Party X into the
currency in which the other is denominated at the rate of exchange at which such
party would be able, acting in a reasonable manner and in good faith, to purchase
the relevant amount of such currency. 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 relevant currency.




If an obligation is unascertained, Party X may in good faith estimate that
obligation and set-off in respect of the estimate, subject to the relevant party
accounting to the other when the obligation is ascertained.




Nothing in this Section 6(f) shall be effective to create a charge or other
security interest. This Section shall be without prejudice and in addition to any
right of set-off, combination of accounts, lien or other right to which any party
is at any time otherwise entitled (whether by operation of law, contract or
otherwise).”



     (F) Inconsistency Among Definitions or Provisions. In the event of any inconsistency
between the
definitions or provisions in any of the following documents, the relevant document first
listed below shall govern:
(i) a Confirmation (with respect only to definitions in such Confirmation; provided, however,
that other provisions
in a Confirmation will govern over inconsistent provisions in the following documents to the
extent that such
Confirmation explicitly states its intent to modify the following documents); (ii) the
Schedule to the ISDA Master
Agreement; (iii) the ISDA Master Agreement; and (iv) the 2000 Definitions.



     (G) Incorporation by Reference of Terms of the Loan Agreement. The covenants, terms
and
provisions of, including all representations and warranties of Party B contained in the Loan
Agreement, as in effect
from time to time are hereby incorporated by reference in, and made part of, this Agreement to
the same extent as if
such covenants, terms, and provisions were set forth in full herein. In the event of any
inconsistency between the
covenants, terms and provisions of the Loan Agreement and this Agreement, the covenants,
terms, and provisions of
this Agreement shall govern. Party B hereby agrees that, during the period commencing with
the date of this
Agreement through and including such date on which all of Party B’s obligations under this
Agreement are fully
performed, Party B will (a) observe, perform, and fulfill each and every such covenant, term,
and provision
applicable to Party B, as such covenants, terms, and provisions, may be amended from time to
time after the date of
this Agreement with the consent of Party A provided that such consent of Party A shall
be deemed to be given
automatically under this Agreement, without any further action hereunder by either of
Party A or Party B, if Party A
or any of its Affiliates (in its capacity as Lender or as Administrative Agent (as applicable)
under the Loan
Agreement) has consented to the amendment of such covenant, term or provision contained in the
Loan Agreement.
Subject to Part l(H)(i) of this Agreement, in the event the Loan Agreement terminates or
becomes no longer binding
on Party B prior to the termination of this Agreement and any Transactions outstanding
hereunder, such covenants,
terms, and provisions (other than those requiring payments in respect of amounts owned under
the Loan Agreement)
as they existed immediately prior to such termination or such non-binding event, will remain
in force and effect for
purposes of this Agreement as though set forth in full herein until the date on which all of
Party B’s obligations
under this Agreement are fully performed and this Agreement is terminated.



     (H) Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining provisions of the
Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.
The parties hereto shall endeavor in good faith negotiations to replace the prohibited or
unenforceable provision with a valid provision, the economic effect of which comes as close as
possible to that of the prohibited or unenforceable provision.



25









 





     (I) WAIVER OF JURY TRIAL. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY AND ALL
RIGHT TO TRIAL BY JURY IN ANY TRIAL OR LITIGATION ARISING OUT OF OR IN CONNECTION WITH ANY
TRANSACTION OR THIS AGREEMENT.



     (J) Events of Default. Section 5 of this Agreement is hereby amended as
follows:




     (i) Breach of Agreement. Section 5(a)(ii) of this Agreement is hereby amended
by substituting “tenth Business Day (as defined in the Loan Agreement)” for “thirtieth
(Say” in the fifth line thereof.



     (K) Condition Precedent. The terms of Section 2 of the Agreement are hereby amended by
the addition of the following subclause (iv):




     “(iv) in addition to the conditions precedent set out in Section 2(a)(iii), if
applicable, each obligation of each party under section 2(a)(i) is subject to the condition
precedent that no Additional Termination Event has occurred and is continuing with respect
to which the other party is an Affected Party and with respect to which all outstanding
Transactions are Affected Transactions.




(L) Bankruptcy. Section 5(a)(vii) of the Agreement is hereby amended by
substituting the number “60” for the number “30” wherever it appears therein.”



     (M) RISK DISCLOSURE. PARTY B HEREBY ACKNOWLEDGES AND AGREES THAT IT HAS: (X)
READ THE RISK DISCLOSURE SET FORTH ON EXHIBIT A; (Y) UNDERSTANDS SUCH RISK DISCLOSURE; AND (Z) HAD
AN ADEQUATE OPPORTUNITY TO DISCUSS ANY QUESTIONS OR COMMENTS THAT IT MAY HAVE HAD WITH RESPECT TO
SUCH RISK DISCLOSURE PRIOR TO THE EXECUTION OF THIS AGREEMENT.



     (N) Consent to Recording. Each party (i) consents to the recording of the
telephone conversations of trading and marketing personnel of the parties in connection with this
Agreement or any potential Transaction, and (ii) agrees to obtain any necessary consents of and
give notice of such recording to its personnel, and (iii) consents to the submission of any such
tape recording in evidence in any Proceedings.



     IT 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.



	 	 	 	 	 
	“Party A”

	 	 	 	“Party B”
	 
	 	 	 	 
	WELLS FARGO BANK, N.A.

	 	 	 	SMART MODULAR TECHNOLOGIES (WWH), INC.
	 
	 	 	 	 
	By: /s/ Susan K. Payunk

	 	 	 	By: /s/ Jack Pacheco
	 

	 	 	 	 

	Name: Susan K. Payunk

	 	 	 	Name: Jack Pacheco
	Its: Authorized Signatory

	 	 	 	Its: Vice President & CFO






26









 





EXHIBIT A




RISK DISCLOSURE



AS IS COMMON WITH MANY OTHER FINANCIAL INSTRUMENTS AND TRANSACTIONS, OVER-THE-COUNTER SWAPS,
OPTIONS, FORWARDS, FOREIGN EXCHANGE TRANSACTIONS AND OTHER SIMILAR DERIVATIVES AND RELATED PRODUCTS
(EACH, A “FINANCIAL PRODUCTS TRANSACTION”) MAY INVOLVE A VARIETY OF SIGNIFICANT RISKS. BEFORE
ENTERING INTO ANY FINANCIAL PRODUCTS TRANSACTION, YOU SHOULD CAREFULLY CONSIDER WHETHER THE
TRANSACTION IS APPROPRIATE FOR YOU IN LIGHT OF YOUR OBJECTIVES, EXPERIENCE, FINANCIAL AND
OPERATIONAL RESOURCES, AND OTHER RELEVANT CIRCUMSTANCES. YOU SHOULD ALSO ENSURE THAT YOU FULLY
UNDERSTAND THE NATURE AND EXTENT OF YOUR EXPOSURE TO RISK OF LOSS, IF ANY, WHICH IN SOME
CIRCUMSTANCES MAY SIGNIFICANTLY EXCEED THE AMOUNT OF ANY INITIAL PAYMENT MADE BY OR TO YOU.



THE SPECIFIC RISKS PRESENTED BY A PARTICULAR FINANCIAL PRODUCTS TRANSACTION NECESSARILY DEPEND
UPON THE TERMS OF THAT TRANSACTION AND THE CIRCUMSTANCES. COMMON TO ALL, HOWEVER, IS THEIR NATURE
AS LEGALLY BINDING CONTRACTUAL COMMITMENTS, WHICH, ONCE AGREED TO, CANNOT BE ALTERED OTHER THAN BY
TERMINATION OR MODIFICATION UPON WRITTEN AGREEMENT BY THE PARTIES. YOU SHOULD UNDERSTAND THAT SUCH
TERMINATION AND/OR MODIFICATION MAY, IN CERTAIN CIRCUMSTANCES, RESULT IN SIGNIFICANT LOSSES TO YOU
AND MAY INCLUDE ADDITIONAL AMOUNTS REQUIRED TO COVER THE RELEVANT COSTS.



IN ENTERING INTO ANY FINANCIAL PRODUCTS TRANSACTION WITH, OR ARRANGED BY, US, WELLS FARGO BANK,
NATIONAL ASSOCIATION, OR, AS MAY BE APPLICABLE, OUR AUTHORIZED SUBSIDIARIES OR AFFILIATES (EACH
SUCH ENTITY, “WELLS FARGO”), YOU SHOULD ALSO UNDERSTAND THAT WELLS FARGO IS ACTING SOLELY IN THE
CAPACITY OF AN ARM’S LENGTH CONTRACTUAL COUNTERPARTY AND NOT IN THE CAPACITY OF YOUR FINANCIAL
ADVISOR OR FIDUCIARY UNLESS OTHERWISE EXPLICITLY AGREED IN WRITING AND THEN ONLY TO THE EXTENT SO
PROVIDED.



THIS BRIEF STATEMENT DOES NOT PURPORT TO DISCLOSE ALL OF THE RISKS OR OTHER RELEVANT
CONSIDERATIONS OF ENTERING INTO FINANCIAL PRODUCTS TRANSACTIONS.




27









 

















 





Hedging Authority Resolution




Adopted by the Board of Directors of 




SMART MODULAR TECHNOLOGIES (WWH), INC.




 




I, the undersigned, the Secretary of Smart Modular Technologies (WWH), Inc. (“Party B”), a
company incorporated under the laws of the Cayman Islands, DO HEREBY CERTIFY that the following is
in full force and effect:





WHEREAS, an ISDA Master Agreement (the “Agreement”), by and between Party B and Wells
Fargo Bank, N.A, (“Party A”), has been reviewed by Party B;




WHEREAS, Party B desires to enter into derivative and/or hedging transactions to manage
the risks associated with its business, which may include, without limitation, commodity
prices and/or supplies, equity and market portfolio risks and interest rates, all on the
terms and conditions set forth in the Agreement;




WHEREAS, Party B understands the structure of derivative and hedging transactions,
including, but not limited to, swaps, caps, floors, collars, locks, forwards and
options, and wishes to utilize these products to manage these risks;




RESOLVED, that the form, terms and provisions of the Agreement, to be entered into by
Party B and Party A are hereby approved in all respects; that the officers of Party B,
acting alone or together, are hereby authorized and empowered, in the name and on behalf
of Party B, to execute and deliver Party A an agreement in substantially the form of
the Agreement with such changes therein as shall be approved by officer executing the
same on behalf of Party B, such approval to be conclusive evidence by execution thereof;
and




RESOLVED, that the officers of Party B, acting alone or together, are hereby authorized
and directed to execute and deliver such additional certificates and documents,
including without limitation confirmations and credit support documents under or in
respect of the Agreement, and to take such other steps and to do such other acts and
things, as in their judgment may be necessary, appropriate or desirable in order to
carry out the terms and provisions of the Agreement and otherwise to consummate the
transactions contemplated thereby, and




RESOLVED, Party A is authorized to rely on these resolutions until written notice of any
change therein, in form satisfactory to Party A, shall have been received by an
appropriate authorized representative of Party A.



Page 1 of 2









 















 




I DO FURTHER CERTIFY that the below-named person(s) have been duly qualified as, and at all times
since April 27, 2007 have been, officers of Party B holding the respective offices opposite their
names and the signatures opposite their names are their genuine signatures:




	 	 	 	 	 	 	 	 	 
	Name

	 	Title
	 	 	 	Specimen Signature	 	 
	 
	 
	 	 	 	 	 	 	 	 
	IAIN MACKENZIE

	 	CEO/PRESIDENT/DIRECTOR
	 	 	 	/s/ Iain Mackenzie	 	 
	 

	 	 
	 	 	 	 	 	 
	Print Name

	 	Title
	 	 	 	Signature 	 	 
	 
	 	 	 	 	 	 	 	 
	JACK A. PACHECO

	 	SVP/CFO
	 	 	 	/s/ Jack A. Pacheco	 	 
	 

	 	 
	 	 	 	 	 	 
	Print Name

	 	Title
	 	 	 	Signature 	 	 
	 
	 	 	 	 	 	 	 	 
	ANN T. NGUYEN

	 	GENERAL COUNSEL/SECRETARY
	 	 	 	/s/ Ann T. Nguyen	 	 
	 

	 	 
	 	 	 	 	 	 
	Print Name

	 	Title
	 	 	 	Signature 	 	 





IN WITNESS WHEREOF, I have executed this Resolution as of this 26th day of June, 2007.




	 	 	 	 	 
	By: Ann T. Nguyen

	 	 	 	 
	 
	 	 	 	 
	
Name: ANN T. NGUYEN

	 	 	 	 
	Title: Secretary

	 	 	.	 







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