Document:

Exhibit
10.2.2

 

EXECUTION
VERSION

 

ANNEX
1 – COMMITTED TERM REPURCHASE AGREEMENT ANNEX

 

This Committed Term
Repurchase Agreement Annex (this “Annex”) amends, supplements and forms a part
of the Master Repurchase Agreement dated as of June 30, 2009 (the “Base
Agreement”) between FSA Asset Management LLC (“FSAM” or “Seller”) and Dexia
Crédit Local S.A. (“DCL” or “Buyer”). 
Capitalized terms used in the Base Agreement but separately defined
herein have the meanings set forth herein and not those in the Base Agreement.  Capitalized terms not defined herein have the
meanings set forth in the Base Agreement or if not defined therein, in the
Pledge and Administration Agreement identified below.

 

1.                                      DEFINITIONS

 

“Accelerated Downgrade Liquidity Draw” means a
Liquidity Draw Request for the purpose of paying, or reserving funds for
payment of, the
maximum amount potentially payable under the Accelerated Termination GICs as a
result of a GIC Credit Event which has made one or more Accelerated Termination Downgrade Provisions
applicable under the relevant Accelerated Termination GICs.

 

“Accelerated Downgrade
Liquidity Draw Deadline” means 9:00 A.M., New York City time, on the
first Business Day after the date on which the relevant Accelerated Downgrade
Liquidity Draw is deemed requested.

 

“Accelerated
Termination Downgrade Provision” means a provision that requires the
termination and repayment of an FSA GIC Contract either automatically, or
assuming immediate notice from the relevant GIC Holder electing such
termination and repayment, upon a relevant GIC Credit Event, and which becomes
applicable six “business days” (as defined in the relevant FSA GIC Contract) or
sooner after a downgrade of the rating of FSA’s financial strength to below a
threshold of “A-” by S&P or “A3” by Moody’s (or to below a lower threshold).

 

“Accelerated
Termination GIC” means an FSA GIC Contract which is subject to an Accelerated Termination Downgrade
Provision and which
is identified as an Accelerated Termination GIC in Appendix 3 to the Sovereign
Guarantee.

 

“Additional Costs”
means amounts due and payable pursuant to Paragraph 10.

 

“Agreement”
means the Base Agreement, as amended and supplemented by this Annex, and of
which this Annex forms a part, together with each Confirmation hereunder from time
to time.

 

“Applicable
Spread” shall mean 0.90% per annum.

 

“Authorized Account”
means the FSAM Cash Account.

 

“Best
Available Eligible Securities” means those Eligible Securities owned by
Seller and available to be transferred by Seller to Buyer in connection with
this Agreement which fall into the highest of the Priority Categories specified
on Schedule A and are transferred in accordance with Paragraph 3(b)(ii).

 

 

“Business
Day” has the meaning specified in the Pledge and Administration Agreement and
each reference to “business day” in the Base Agreement shall be a reference to
a Business Day.

 

“Buyer’s
Margin Percentage” means 100%.

 

“Commitment Effective
Date” means June 30, 2009.

 

“Commitment Fee Period”
shall mean each period commencing on and including one Commitment Fee Period
End Date and ending on but excluding the next succeeding Commitment Fee Period
End Date.

 

“Commitment Fee Period
End Date” shall mean each of (i) the Commitment Effective Date (which
shall be the first Commitment Fee Period End Date) and (ii) each date
which is three calendar months after the immediately preceding Commitment Fee
Period End Date; provided that the Facility Termination Date shall be the last
Commitment Fee Period End Date.

 

“Default
Repo Termination Request” has the meaning specified in Paragraph 3(b)(vii).

 

“Dollars”
or “$” means the lawful currency of the United States of America.

 

“Eligible Securities” means the Put Portfolio Assets,
Excluded Assets and Other Assets owned by Seller as of the date of the Agreement,
and any securities purchased by Seller after the date of the Agreement which
are included in one of the categories of securities listed on Schedule A.

 

“Facility
Amount” means $3,500,000,000 (Three Billion Five Hundred Million Dollars)
or such lesser Dollar amount to which the Facility Amount may be reduced from
time to time in accordance with Paragraph 7 of this Annex.

 

“Facility Termination
Date” means the earliest to occur of the following: (a) that date on
which all of the FSA GIC Contracts are Paid in Full or terminated and there are
no outstanding amounts owed by FSAM under the FSAM Insurance Agreement, the
Master Repurchase Agreement or the Administrative Services Agreement that have
not been Paid in Full, (b) the date which is (x) in the case of a
Dexia Event of Default occurring at least 10 Business Days prior to the
Liquidity and Collateral Trigger Expiration Date, the Liquidity and Collateral
Expiration Date and (y) in the case of a Dexia Event of Default occurring
on or after the tenth Business Day preceding the Liquidity and Collateral
Trigger Expiration Date, 30 calendar days following such Dexia Event of Default
(or if such day is not a Business Day, the next Business Day), and (c) the
Business Day immediately following the settlement date of the set of
Transactions initiated by a Default Repo Termination Request permitted upon a
Dexia Event of Default as described in Paragraph 3(b)(vii) added by this
Annex.

 

“GIC Credit Event”
means with respect to any FSA GIC Contract, the downgrade, qualification or
withdrawal of the credit ratings of FSA by one or more of Moody’s, Fitch or
S&P, as specified in that FSA GIC Contract.

 

“GAAP” shall mean
United States generally accepted accounting principles consistently applied.

 

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“IFRS” shall mean
International Financial Reporting Standards as promulgated by the International
Standards Accounting Board as in effect from time to time consistently applied.

 

“LIBOR” shall mean
the rate per annum calculated as set forth below:

 

(i)                                     On each Reset Date, LIBOR for the next
Pricing Rate Period will be reset as the rate for deposits in Dollars for the
Specified LIBOR Period which appears on Reuters Screen LIBOR01 as of 11:00 A.M.,
London time, on such Reset Date; or

 

(ii)                                  On any Reset Date on which no such rate
appears on Reuters Screen LIBOR01 as described above, LIBOR for the next
Pricing Rate Period will be determined on the basis of the arithmetic mean of
the rates at which deposits in Dollars are offered by the Reference Banks at
approximately 11:00 A.M., London time, on such Reset Date to prime banks
in the London interbank market for the Specified LIBOR Period.

 

All percentages resulting
from any calculations or determinations referred to in this definition will be
rounded upwards, if necessary, to the nearest multiple of 1/100th of 1% and all
Dollar amounts used in or resulting from such calculations will be rounded to
the nearest cent (with one-half cent or more being rounded upwards).  In the event that the number of days in the
first Pricing Rate Period or last Pricing Rate Period is different than the
number of days corresponding to the Specified LIBOR Period, LIBOR for such
Pricing Rate Period shall be based on an interpolated rate determined by the Buyer
in a commercially reasonable manner.

 

“Margin Notice Deadline”  means
11:00 A.M., New York time,  on
a Business Day.

 

“Market Value” means on any date and with respect to any
Eligible Securities, the “Mark to Market Value” thereof as defined in the Pledge
and Administration Agreement and as most recently determined on or prior to the
date of determination.

 

“Pledge and
Administration Agreement” means the Pledge and Administration Agreement,
dated as of June 30, 2009, entered into among Dexia SA, Dexia Crédit Local S.A.,
Dexia Bank Belgium SA, Dexia FP Holdings Inc., Financial Security Assurance
Inc. (“FSA”), FSA Asset Management LLC (“FSAM”), FSA Portfolio Asset Limited,
FSA Capital Markets Services LLC, FSA Capital Markets Services (Caymans) Ltd.,
FSA Capital Management Services LLC and The Bank of New York Mellon Trust
Company, National Association as Collateral Agent (the “Collateral Agent”), as
amended, restated, supplemented or otherwise modified from time to time..

 

“Pricing
Rate” shall mean, for any Purchased Securities and any Pricing Rate Period,
an annual rate equal to LIBOR for such Pricing Rate Period plus the Applicable
Spread.  The Pricing Rate shall be
computed on the basis of a 360-day year and the actual number of days elapsed.

 

“Pricing Rate
Determination Date” shall mean with respect to any Pricing Rate Period, the
second (2nd) Business Day preceding the first day of
such Pricing Rate Period.

 

“Pricing Rate Period
End Date” shall mean in relation to any Transaction each of (i) the
Purchase Date (which shall be the first Pricing Rate Period End Date), and (ii) each
date which is a 

 

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number of a calendar
months equal to the Specified LIBOR Period after the immediately preceding
Pricing Rate Period End Date; provided that the Repurchase Date shall be the
last Pricing Rate Period End Date.

 

“Pricing Rate Period”
shall mean each period commencing on and including one Pricing Rate Period End
Date and ending on but excluding the next succeeding Pricing Rate Period End
Date.

 

“Purchase Date”
shall mean, with respect to any Purchased Security, the date on which such
Purchased Security is transferred by Seller to Buyer.

 

“Purchase Price”
shall mean, with respect to (i) any Purchased Security other than a Put
Portfolio Asset, the price at which such Purchased Security is transferred by
Seller to Buyer on the applicable Purchase Date, which shall be equal to the
Market Value of such Purchased Security on the date the Confirmation for the
relevant Transaction is received, and (ii) any Purchased Security that is
a Put Portfolio Asset an amount equal to the “Put Settlement Amount” for such
Purchased Security as defined in the Put Option Confirmation between Dexia SA,
Dexia Credit Local S.A. and FSAM related to the Guaranteed Put Contract.

 

“Reference
Banks” shall mean banks each of which shall (i) be a leading bank
engaged in transactions in Eurodollar deposits in the international
Eurocurrency market and (ii) have an established place of business in
London.  Initially, the sole Reference
Bank shall be JPMorgan Chase Bank.  If
any Reference Bank should be unwilling or unable to act as such or if Buyer
shall terminate the appointment of any Reference Bank or if any Reference Bank
should be removed from the Reuters Monitor Money Rates Service or in any other
way fail to meet the qualifications of a Reference Bank, Buyer in the exercise
of its good faith business judgment may designate one or more alternative banks
meeting the criteria specified in clauses (i) and (ii) above
as Reference Banks for purposes of this Annex.

 

“Repurchase
Transaction Request” has the meaning specified in Paragraph 3(b)(i).

 

“Requirement of Law”
shall mean any law, treaty, rule, regulation, code, directive, policy, order or
requirement or determination of an arbitrator or a court or other governmental
authority whether now or hereafter enacted or in effect.

 

“Reset Date” shall
mean, with respect to any Pricing Rate Period, the second Business Day
preceding the first day of such Pricing Rate Period with respect to any
Transaction.

 

“Securities Priority
List” means a priority listing of the Best Available Eligible Securities
for purposes of this Agreement maintained by Seller and a copy of which Seller
has provided to Buyer, as most recently updated by Seller and notified to Buyer
through the date of determination.

 

“Seller’s
Margin Percentage” means 100%.

 

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“Specified LIBOR
Period” means, in relation to any Transaction, the period of one month, two
months, three months or six months as specified by Seller in relation to such
Transaction in its Repurchase Transaction Request.

 

“Unutilized
Commitment” means on any date (x) the Facility Amount minus (y) the
Purchase Price of all Purchased Securities that have not been repurchased by
Seller hereunder (or with respect to which such repurchase has not been
settled) on or prior to such date.

 

“Weekly Assessment
Point” means the first Business Day of each calendar week, when FSAM will
evaluate the balance of cash in the FSAM Cash Account at the opening of
business on such day, the payments expected to be received over the next seven
calendar days and, with respect to collateral posting requirements, the amount
of qualifying assets otherwise available to satisfy such posting requirements
and compare such required amount to the Senior Priority Payments required to be
paid during the next seven calendar days.

 

The
definition of “Act of Insolvency” in the Base Agreement is deleted.

 

2.                                      COMMITMENT; FACILITY AMOUNT; FEES

 

(a)                                  From the
Commitment Effective Date to the Facility Termination Date, Buyer agrees to
enter into Transactions on the terms set forth below from time to time upon
request by Seller, subject to and in accordance with the terms and conditions
of this Annex and the Agreement. 
Notwithstanding anything to the contrary herein, Buyer shall have no
obligation to enter into any proposed Transaction on any proposed Purchase Date
that would have a Purchase Price that would, when combined with the Purchase
Price of all Purchased Securities that have not been repurchased by Seller
hereunder on or prior to such proposed Purchase Date exceed the Facility
Amount.

 

(b)                                 FSAM agrees to pay to DCL, subject to the
Priority of Payments and satisfaction of the Subordinated Claims Payment
Condition specified therein, a commitment fee at the rate of 0.50% per annum on
the Unutilized Commitment as determined by calculating the average Unutilized
Commitment for each day of the fiscal quarter on the Weekly Assessment Point
immediately following the end of each fiscal quarter.  Such fee shall be payable three (3) Business
Days following each Weekly Assessment Point, if such fee was considered in
making the calculations on such day, in accordance with the preceding sentence,
and on the date on which the Commitment terminates.

 

3.                                      INITIATION;
CONFIRMATION; TERMINATION

 

The
provisions of Paragraph 3(a) and (b) of the Base Agreement are hereby
deleted and replaced in their respective entireties by the following
provisions:

 

“(a)                            By 2:00 P.M.,
New York time, on the Purchase Date for a Transaction, Buyer shall transfer the
Purchase Price with respect to each Purchased Security specified in the
relevant Confirmation to Seller by wire transfer of immediately available funds  to either (i) the Authorized Account
or (ii) the relevant account for any Senior Priority Payment identified by

 

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FSAM under Section 11.2
of the Pledge and Administration Agreement in relation to which a Transaction
is requested hereunder, and the related Purchased Security shall be
concurrently transferred by Seller to an account specified by Buyer.

 

(b)                                 (i)                                     Seller (or the Collateral Agent or FSA as
contemplated by (vi) below) may, from time to time,
prior to the Facility Termination Date, request that Buyer enter into a
Transaction with respect to one or more Eligible Securities.  Seller (or the Collateral Agent or FSA as contemplated by (vi) below)
shall initiate each request by submitting a written request, which shall
set forth (A) information identifying, and specifying the principal amount
of, each Eligible Security to be sold to Buyer as Purchased Securities, (B) the
Purchase Price in relation to such Purchased Securities based on the
calculation thereof by the Collateral Agent, (C) a date not earlier than
one (1) Business Day following, and not later than three (3) Business
Days following, the effective date of such request as the proposed Purchase
Date, (D) the Specified LIBOR Period for the relevant Transaction, (E) such
date, if any, as Seller (or the Collateral Agent or FSA as contemplated by (vi) below) may elect to
specify as a fixed date of termination of such Transaction (a “Repurchase
Transaction Request”).  Each Repurchase
Transaction Request shall be accompanied by the certificate described in clause
(iii) below.  Except as provided in
clauses (ii) and (vii) below, any such Repurchase Transaction Request
shall be effective (x) on the Business Day made, if delivered to Buyer at
or before 4:30 P.M., Paris time, (the “Notice Deadline”) on such Business Day, or (y) otherwise,
on the Business Day immediately following the date of its delivery to the
Buyer.  Each Repurchase Transaction
Request shall be copied
to the Collateral Agent at its address designated pursuant to Annex 2 to the
Agreement.  Any Repurchase
Transaction Request will
be made by email or facsimile, return receipt requested, in accordance with the
address information set forth in Annex 2.

 

(ii)                                  Notwithstanding the foregoing, an
Accelerated Downgrade Liquidity Draw will be deemed to have been made on the
day of the GIC Credit Event without regard to whether such GIC Credit Event
occurred before or after close of business on that day.  The Buyer will be required to advance funds
with respect to such Transaction by the Accelerated Downgrade Liquidity Draw
Deadline, notwithstanding any failure of the Seller to comply with Paragraphs
3(b)(i), 3(e) and 8(b) in connection with such deemed request.  Without conditioning the obligations of the
Buyer to provide funds under this paragraph, FSA shall provide notice of such
GIC Credit Event on the date such event occurs.

 

(iii)                               At the time of any Repurchase Transaction
Request, the Administrator (or if the Administrator has failed to make the
relevant evaluation and comparisons, FSA) shall deliver a certificate to the
Buyer, setting out the evaluation and comparison contemplated to be made by the
Administrator under Sections 9.1 and 11.2(a) and (b) of the Pledge
and Administration Agreement (and may also include any updates to such
information) and stating that the proceeds of the relevant Transaction will be
as contemplated by Paragraph 8(b) below. 
Notwithstanding the foregoing, if the proceeds of any Transaction give
rise to a Dexia Reimbursement Payment, such portion of any Transaction shall be
repaid promptly against delivery of the Purchased Securities related to such
proceeds, together with any interest accrued thereon (but excluding any
Additional Costs) and such repayment shall not be subject to the Subordinated
Claims Payment Condition.

 

6

 

(iv)                              In making a
Repurchase Transaction Request, Seller (or the Collateral Agent or FSA as contemplated by (vi) below)
shall identify as Purchased Securities for the relevant Transaction
securities that are not eligible to be posted as collateral under the FSA GIC
Contracts (A) first, out of the Excluded Assets and Other Assets, the Best
Available Eligible Securities based on the Securities Priority List as of the
date of such Repurchase Transaction Request, with Seller (or the Collateral Agent or FSA as
contemplated by (vi) below) identifying Eligible
Securities lower on the Securities Priority List out of the Excluded Assets and
Other Assets only as necessary to result in Seller’s obtaining the Purchase
Price sought by Seller in requesting such Repurchase Transaction, and (B) second,
out of the Put Portfolio Assets in the same manner as set forth in subclause
(A).  Seller agrees to use good faith,
commercially reasonable efforts to ensure that the Securities Priority List is
updated from time to time to reflect the Best Available Eligible Securities
(and which shall specify whether the securities are Excluded Assets and Other
Assets, Put Portfolio Assets or assets that are eligible to be posted as
collateral under the FSA GIC Contracts), and Buyer shall have the right to
consult with Seller from time to time, as to whether the Securities Priority
List accurately reflects the Best Available Eligible Securities.

 

Notwithstanding
the foregoing, on any date on which the Liquidity Facility has been fully
drawn, a Repurchase Transaction Request may be made in relation to any Best
Available Eligible Securities that would not be required to meet currently
applicable collateral posting requirements in relation to FSA GIC Contracts (or
would be required only to meet collateral posting requirements in relation to
FSA GIC Contracts for which FSAM may elect not to post collateral in accordance
with Section 11.2 of the Pledge and Administration Agreement).

 

(v)                                 Each Repurchase
Transaction Request shall constitute a “Confirmation” for purposes of the Base
Agreement, which Confirmation,
together with the Agreement, shall be conclusive evidence of the terms of the
Transaction covered thereby unless objected to in writing by Buyer for manifest
error no more than one (1) Business Day after the date such Confirmation
is received by Buyer.  Each
Confirmation shall be deemed incorporated herein by reference with the same
effect as if set forth herein at length. 
With respect to any Transaction, the Pricing Rate shall be determined
initially as of the Pricing Rate Determination Date applicable to the first
Pricing Rate Period for such Transaction, and shall be reset on each Reset Date
for the next succeeding Pricing Rate Period for such Transaction.  Buyer or its agent shall determine in
accordance with the terms of this Annex the Pricing Rate on each Pricing Rate
Determination Date for the related Pricing Rate Period and notify Seller of
such rate for such period on the Reset Date or Pricing Rate Determination Date
with respect to the first Transaction.

 

(vi)                              In the event that FSA has given written
notice to the Seller with a copy to the Buyer that (i) the Seller has
failed to comply with the Seller’s obligation to deliver a Repurchase
Transaction Request under this Annex as set forth in Section 11.2(b) of
the Pledge and Administration Agreement by 4:30 P.M., Paris time, on any
Business Day or that (ii) Senior Priority Payments cannot be paid on any
Business Day and the Seller has not delivered a Repurchase Transaction Request
as set forth in Section 11.2 of the Pledge and Administration Agreement in
an amount equal to such unpaid Senior Priority Payments or the remaining amount
available under the Facility Amount (if less) by 4:30 P.M., Paris time,
then the Collateral Agent or FSA shall be authorized to deliver a Repurchase
Transaction Request on behalf of the Seller, and 

 

7

 

such Repurchase
Transaction Request, if delivered no later than 4:30 P.M., Paris time, on
the Business Day immediately following the Business Day on which the Seller
fails to deliver a Repurchase Transaction Request, will be deemed to have been
delivered by 4:30 P.M., Paris time, on the preceding Business Day and the
Buyer shall advance funds with respect to such Transaction by 2:00 P.M.,
New York City time, on the Business Day following the failure by the Seller to
make the request notwithstanding any failure of the Seller to comply with
Paragraphs 3(b)(i) (with respect to the Notice Deadline), 3(e) and
8(b).  Any such request by the Collateral
Agent or FSA must be accompanied by the certificate described in Paragraph
3(b)(iii).  In the event that a Dexia
Event of Default has occurred and FSA has elected to become Secured Party
Representative, the Collateral Agent or FSA shall be authorized to deliver a
Repurchase Transaction Request on behalf of the Seller, and such request shall
be effective hereunder as if made by the Seller.

 

(vii)                           If a Dexia Event of Default has occurred,
the Seller (or the Collateral Agent or FSA as described in Paragraph 3(b)(vi))
is permitted to deliver a Repurchase Transaction Request, on or before the
Termination Date, for a set of Transactions (a “Default Repo Termination
Request”) with a Purchase Price in an aggregate amount that, together with any
Default Termination Loan (as defined in the Liquidity Facility), does not
exceed (A) the Exposure as calculated under the Credit Support Annex to
the Dexia Guaranteed Put Contract (as most recently determined on or prior to
the date of such Repurchase Transaction Request), provided that for such
purpose the “GIC Business Costs Amount” shall be deemed increased by 25% minus (B) (x) the
“Value” of all “Posted Collateral” held by the Collateral Agent under the Dexia
CSAs (as such terms are defined in the relevant Dexia CSA and as most recently
determined on or prior to the date of such Repurchase Transaction Request) plus
(y) the cash proceeds of the liquidation of any FSAM Collateral which has
been sold or liquidated in accordance with an exercise of creditor’s remedies
by the Collateral Agent upon such Dexia Event of Default.  For the avoidance of doubt, the amount of any
Default Repo Termination Request delivered by the Seller (or the Collateral
Agent or FSA as described in (vi) above) shall not exceed the Unutilized
Commitment at the time of the request.

 

(viii)                        If Seller, the Collateral Agent or FSA
has effected a Liquidity Draw Offset (as defined in the Credit Support Annex to
the Dexia Guaranteed Put Contract) in relation to any Purchase Price not yet
paid by Buyer in relation to any Repurchase Transaction Request hereunder, the
amount payable as Purchase Price to Seller in relation to such Transaction
shall be reduced by the relevant Liquidity Draw Offset.”

 

Paragraph 3(c) of the Base Agreement is restated to
read as follows:

 

“(c)                            On the earliest of (i) the date (if any) fixed for termination of a
Transaction in the case of Transactions having a fixed term, (ii) any
date which is the last day of a Pricing Rate Period in relation to the relevant
Transaction and is elected by Seller upon not less than two (2) Business
Days’ irrevocable prior written notice to Buyer to be the Repurchase Date for
such Transaction, (iii) any date following a Dexia Event of Default on
which funds are available for payments to Buyer subject to the Priority of Payments and satisfaction
of the Subordinated Claims Payment Condition specified therein, and (iv) the
date on which all of
the FSA GIC Contracts are Paid in Full or terminated and there are no
outstanding amounts owed by the Seller under the 

 

8

 

FSAM Insurance Agreement,
the Master Repurchase Agreement, or the Administrative Services Agreement, termination of the applicable Transaction will be effected by transfer to
Seller or its agent of the Purchased Securities and any Income in respect
thereof received by Buyer (and not previously credited or transferred to, or
applied to the obligations of Seller pursuant to Paragraph 5 hereof) against
the transfer of the Repurchase Price to an account of Buyer.  Where clause (iii) of the foregoing
sentence applies, Transactions shall be terminated in the reverse order of
which they were initiated (on a “last in, first out” basis), and shall be
terminated in part (with Buyer’s delivery of Purchased Securities and Income to
be proportionally adjusted) to the extent that only a portion of the Repurchase
Price would be available under the Priority of Payments and subject to the satisfaction of the
Subordinated Claims Payment Condition specified therein.  Amounts received on a termination
of a Transaction shall be applied in the order of priority set forth in Section 11.1(b)(viii) of
the Pledge and Administration Agreement.

 

The following is deemed
added to the Base Agreement as Paragraphs 3(d), (e), (f) and (g):

 

“(d)                           Either Buyer or Seller may also request a
“delivery versus payment” settlement of amounts to be paid or delivered in
relation to any Transaction on a Purchase Date or Repurchase Date.

 

(e)                                  The obligations of the Buyer to enter
into and make settlement of a Transaction hereunder will be unconditional and
subject only (except as provided in Paragraph 3(b)(ii)) to receipt of the
Repurchase Transaction Request and the certificate described in Paragraph 3(b)(iii) within
the time period contemplated thereby.

 

(f)                                    Without limitation of Paragraph 12(b) below,
no breach by the Seller (or by the Collateral Agent, FSA any other party to the
Pledge and Administration Agreement or any other person) of any representation,
warranty, covenant or other term or condition of this Agreement, the Pledge and
Administration Agreement, any other Transaction Document, or any other
agreement described in or contemplated in the Purchase Agreement shall
constitute a defense to or otherwise impair the obligation of the Buyer to
enter into and make settlement of a Transaction hereunder in accordance with
the terms and conditions described in Paragraph 3(e) above.

 

(g)                                 Notwithstanding Paragraph 3(f) above,
the Buyer will be indemnified by the Seller for any losses incurred by it in
connection with entering into or making settlement of any Transaction if the
representations and warranties of the Seller are inaccurate or the Seller has
breached its obligations under this Agreement to the Buyer, provided that any
such indemnification or any other claim or recourse of the Buyer for a breach
by the Seller of any representation, warranty, covenant or other term or
condition of this agreement (other than as set forth in Paragraph 3(e) above)
will be payable only subject to the Priority of Payments and (without prejudice
to any claims for Dexia Reimbursement Payments in accordance with the terms of
the Pledge and Administration Agreement) satisfaction of the Subordinated
Claims Payment Condition specified therein.”

 

9

 

4.                                      PERIODIC PRICE
DIFFERENTIAL PAYMENTS; MARGIN PAYMENTS

 

(a)                                  On the last day of each Pricing Rate
Period (or if such day is not a Business Day, the next following Business Day),
Seller shall pay to Buyer, subject to the Priority of Payments and the
satisfaction of the Subordinated Claims Payments Condition specified therein (other than with respect to Dexia
Reimbursement Payments), in accordance with the account details specified
in such Confirmation or such standing account details as may be agreed between
Buyer and Seller from time to time, the accrued and unpaid Price Differential in relation
to each Transaction and such Pricing Rate Period.  For purposes of calculating the accrued Price
Differential relation to any Pricing Rate Period other than the initial Pricing
Rate Period, the reference to “Purchase Date” in the definition of “Price
Differential” shall be deemed to refer to the first day of such Pricing Rate
Period.

 

(b)                                 For purposes of Paragraph 4(c) of
the Base Agreement the words “such day” shall be replaced by “the next Business
Day” and the words “the next business day following” shall be replaced by “the
second Business Day following”.

 

(c)                                  For purposes of Paragraph 4(e), the minimum dollar amount of Margin Deficit
which will give rise to obligations under Paragraph 4(a) and 4(b) is
$5,000,000 in relation to all Transactions in the aggregate.  Paragraph 4(f) will not apply.

 

(d)                                 For the avoidance of doubt, payments of Margin Deficit by Seller under
Paragraph 4(a) shall be subject to funds being available therefor under
the Priority of Payments and subject to the satisfaction of the Subordinated Claims Payment
Condition specified therein, provided, however, that
such restriction shall not restrict Buyer’s rights under Paragraph 5 in
relation to Income received on Purchased Securities.

 

(e)                                  For purposes of Paragraph 5, Income shall
be credited by Buyer to the FSAM Cash Account not later than three Business
Days following receipt of such Income by Buyer.

 

5.                                      REPRESENTATIONS

 

Paragraph 10 of the Base Agreement (“Representations”) is hereby
supplemented by the following:

 

“Seller represents and warrants to Buyer that as of the Purchase Date
for the purchase of any Purchased Security by Buyer from Seller and any
Transaction hereunder and as of the date of this Annex and at all times while
this Annex and any Transaction hereunder is in full force and effect:

 

(a)                                  Seller is a limited liability company duly organized, validly
existing and in good standing under the laws of the State of Delaware, and has
all requisite power and authority, corporate and otherwise, to conduct its
business as now conducted and to own its properties.  Seller has full power and authority
to enter into this Agreement and to incur its obligations provided for herein
and therein, all of which have been duly authorized by all proper and necessary
corporate action on the part of the Seller. 
This Agreement has been duly executed and 

 

10

 

delivered by the Seller and constitutes the valid and
legally binding agreement of the Seller, enforceable against the Seller in
accordance with its terms, except as enforceability may be affected by
bankruptcy, insolvency and other laws relating to or affecting creditors’
rights generally and by general principles of equity.

 

(b)                                 All consents and approvals of, and all notices to and filings with, any
governmental entities or regulatory bodies required as a condition to the valid
execution, delivery or performance by the Seller of this Agreement have been
obtained or made.  Neither the execution
and delivery of this Agreement nor compliance with the terms and provisions
hereof and thereof will conflict with, result in a breach of or constitute a
default under (i) any of the terms, conditions or provisions of the
limited liability company agreement of the Seller, (ii) any law,
regulation or order, writ, judgment, injunction, decree, determination or award
of any court or governmental instrumentality or (iii) any agreement or
instrument to which the Seller is a party or by which it is bound.

 

(c)                                  The consolidated financial statements of the Seller and its
consolidated subsidiaries (if any) furnished or made available to the Buyer on
or prior to the date on which this representation is made or deemed repeated
are complete and correct and fairly present the consolidated financial
condition of the Seller and its consolidated subsidiaries as at the dates
thereof and the results of operations for the periods covered thereby (subject,
in the case of quarterly statements, to normal, year-end audit
adjustments).  Such financial statements
were prepared in accordance with GAAP or IFRS consistently applied.

 

(d)                                 The Seller is not (i) a “holding company,” or a “subsidiary
company” of a “holding company,” or of a “subsidiary company” of a “holding
company,” within the meaning of the Public Utility Holding Company Act of 1935,
or (ii) required to be registered as an “investment company” as defined in
(or subject to regulation under) the Investment Company Act of 1940.  Neither the Seller’s entering into any
Transaction, or the application of the proceeds or repayment thereof by the
Seller, nor the consummation of other transactions contemplated hereunder, will
violate any provision of the Public Utility Holding Company Act of 1935, the
Investment Company Act of 1940 or any rule, regulation or order of the SEC.

 

(e)                                  All financial data or information
concerning the Purchased Securities that has been delivered by or on behalf of
Seller to Buyer is, to the best knowledge of Seller, true, complete and correct
in all material respects.

 

(f)                                    Except as disclosed in the manner described in Section 3.1(a)(v) of
the Pledge and Administration Agreement, there is no action, suit or proceeding
pending against, or to the Seller’s knowledge threatened against or affecting,
the Seller before any court or arbitrator or any governmental body, agency or
official which, if adversely determined, would have a material adverse effect
(actual or prospective) on the Seller’s business, properties or financial
position or which seeks to terminate or calls into question the validity or
enforceability of this Agreement.

 

(g)                                 Immediately prior to the purchase of any
Purchased Securities by Buyer from Seller, such Purchased Securities are free
and clear of any lien, security interest, claim, option, charge, encumbrance or
impediment to transfer (including any “adverse claim” as defined in 

 

11

 

Section 8-102(a)(1) of the UCC but excluding any liens or
encumbrances to be released simultaneously with the sale to Buyer hereunder),
and are not subject to any rights of setoff, any prior sale, transfer,
assignment, or participation by Seller or any agreement by Seller to assign,
convey, transfer or participate, in whole or in part, and Seller is the sole
legal record and beneficial owner of and owns and has the right to sell and
transfer such Purchased Securities to Buyer and, upon transfer of such
Purchased Securities to Buyer, Buyer shall be the owner of such Purchased Securities
(other than for U.S. Federal, state and local income and franchise tax
purposes) free of any adverse claim, subject to Seller’s rights pursuant to the
Agreement.  In the event the related
Transaction is recharacterized as a secured financing of the Purchased
Securities, the provisions of the Agreement are effective to create in favor of
Buyer a valid security interest in all rights, title and interest of Seller in,
to and under the Purchased Securities, Buyer shall have a valid, perfected and
enforceable first priority security interest in the Purchased Securities and
such other collateral, subject to no lien or rights of others other than as
granted herein.

 

(h)                                 Neither the entering into nor
consummation of any Transaction hereunder, nor the use of the proceeds thereof,
will violate any provisions of Regulation T, U or X.  If requested by Buyer, Seller, any applicable
Affiliate of Seller and the recipient of any portion of the proceeds of, or any
portion of, any Transaction shall furnish to Buyer a statement on Federal
Reserve Form G-3 referred to in Regulation U.”

 

6.                                      EVENTS OF DEFAULT

 

The first sentence (ending at the colon before subparagraph (a)) of
Paragraph 11 of the Base Agreement (“Events of Default”) is hereby amended to
read as follows:

 

“In the event that a Dexia Event of Default as defined in the Pledge
and Administration Agreement occurs (with respect to Buyer an “Event of Default”):”

 

For the avoidance of doubt, no Events of Default shall apply to Seller
and the provisions of Paragraph 11 referring to circumstances where the Seller
is the defaulting party shall be disregarded.

 

7.                                      OPTIONAL
REDUCTION OF FACILITY BY SELLER

 

With the prior written
consent of FSA, Seller may reduce the Unutilized Commitment portion of the
Facility Amount at any time in whole, or from time to time in part by an amount
equal to $5,000,000 or any larger amount in increments of $1,000,000, (or such
reduction as reduces the Facility Amount to the amount outstanding), by
delivering to Buyer written notice specifying the amount of such reduction and
the date on which such reduction is to become effective (which date may not be
earlier than the date of delivery of such notice).   Any such
reduction shall be irrevocable.  Any such
reduction without the prior written consent of FSA shall be void ab initio.

 

12

 

8.                                      COVENANTS

 

The Seller covenants and agrees that until after the
Facility Termination Date and the later to occur of (i) the last
Repurchase Date and (ii) the performance of all obligations of the Seller
hereunder:

 

(a)                                  General Affirmative Covenants.  The Seller will maintain its
existence as a limited liability company in good standing, will comply in all
material respects with all applicable laws, rules, regulations and orders of
any governmental authority noncompliance with which would have a material
adverse effect on its financial condition or operations or on its ability to
meet its obligations hereunder, and will continue to engage in business of the
same general type as that engaged in by the Seller on the date hereof.  The Seller will pay and discharge, at or
before maturity, all its obligations and liabilities, including, without
limitation, tax liabilities, where failure to satisfy such obligations or liabilities
in the aggregate would have a material adverse effect on its financial
condition, operations or ability to meet its obligations hereunder.

 

(b)                                 Use of Proceeds.  The proceeds of any Transaction may be used only (x) in
the case of any Transaction other than a Transaction requested pursuant to a
Default Repo Termination Request, to satisfy a scheduled or expected Senior
Priority Payment identified by FSAM or FSA in accordance with the provisions Section 11.2(a) or
(b) of the Pledge and Administration Agreement at or prior to the relevant
Repurchase Transaction Request or (y) in the case of a Transaction
requested pursuant to a Default Repo Termination Request, to be applied to
Senior Priority Payments or to purchase Permitted Investments to be held by the
Collateral Agent under the Pledge and Administration Agreement and subsequently
applied to Senior Priority Payments.

 

(c)                                  Maintenance of Properties.  The Seller shall (a) maintain, preserve
and protect all of its material properties and equipment necessary in the
operation of its business in good working order and condition, ordinary wear
and tear excepted; and (b) use the standard of care typical in the
industry in the operation and maintenance of its facilities, except where the
failure to do so could not reasonably be expected to have a material adverse
effect on the Seller.

 

(d)                                 Maintenance of Insurance.  The Seller shall maintain with financially
sound and reputable insurance companies or with a captive insurance company
that is an affiliate of the Seller as to which the Buyer may request reasonable
evidence of financial responsibility, insurance with respect to its properties
in such amounts with such deductibles and covering such risks as are
customarily carried by companies engaged in similar businesses and owning
similar properties in localities where the Seller or any of its subsidiaries
operates.

 

9.                                      RETRANSFER TERMS

 

It is Seller’s intent to account for each
Transaction hereunder as a secured financing under GAAP and/or IFRS.  Notwithstanding Paragraph 8 of the Base
Agreement, Buyer agrees to use its good faith, commercially reasonable efforts
to enter into any restriction on Buyer’s rights 

 

13

 

under Paragraph 8 of the Base Agreement which
Seller shall demonstrate, to be required in order for Seller to properly
account for any Transaction as a secured borrowing.

 

10.                               TAXES, INCREASED COSTS

 

(a)                                  If, after the date of this Annex, the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof by any
Governmental Authority or compliance by Buyer with any request or directive
(whether or not having the force of law) from any central bank or other
Governmental Authority having jurisdiction over Buyer made subsequent to the
date hereof:

 

(i)                                     shall subject Buyer to any tax of any kind whatsoever with respect to the
Agreement, any Purchased Security or any Transaction, or change the basis of
taxation of payments to Buyer in respect thereof (except for changes in the rate
of tax on Buyer’s overall net income);

 

(ii)                                  shall impose, modify or hold applicable any reserve, special deposit,
compulsory loan or similar requirement against assets held by, deposits or
other liabilities in or for the account of, advances, loans or other extensions
of credit by, or any other acquisition of funds by, any office of Buyer; or

 

(iii)                               shall impose on Buyer any other condition due to the Agreement or the
Transactions;

 

and the
result of any of the foregoing is to increase the cost to Buyer of entering
into, continuing or maintaining Transactions or to reduce any amount receivable
under the Agreement in respect thereof; then, in any such case, Seller shall
pay Buyer, within 30 days after written demand therefor is received by Seller,
any additional amounts necessary to compensate Buyer for such increased cost
payable or reduced amount receivable.  If
Buyer becomes aware that it is entitled to claim any additional amounts
pursuant to this Paragraph 10(a), it shall notify Seller in writing of the
event by reason of which it has become so entitled within a reasonable period
after Buyer becomes aware thereof.  A
certificate as to the calculation of any additional amounts payable pursuant to
this subsection shall be submitted by Buyer to Seller and shall be conclusive
and binding upon Seller in the absence of manifest error.  In determining such additional amounts, Buyer
will act reasonably and in good faith.

 

This
covenant shall survive the last Repurchase Date, and the repurchase by Seller
of any or all of the Purchased Securities.

 

(b)                                 If Buyer shall have reasonably determined that the adoption of or any
change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by Buyer or any corporation
controlling Buyer with any request or directive regarding capital adequacy
(whether or not having the force of law) from any Governmental Authority made
subsequent to the date hereof does have the effect of reducing the rate of
return on Buyer’s or such corporation’s capital as a consequence of its
obligations 

 

14

 

hereunder to a level below
that which Buyer or such corporation could have achieved but for such adoption,
change or compliance (taking into consideration Buyer’s or such corporation’s
policies with respect to capital adequacy) by an amount deemed by Buyer to be
material, then, from time to time, within 30 days after submission by Buyer to
Seller of a written request therefor, Seller shall pay to Buyer such additional
amount or amounts as will compensate Buyer for such reduction.  A certificate as to the calculation of any
additional amounts payable pursuant to this subsection shall be submitted by
Buyer to Seller and shall be conclusive and binding upon Seller in the absence
of manifest error.  In determining such
additional amounts, Buyer will act reasonably and in good faith.  This covenant shall survive the Facility
Termination Date, and the repurchase by Seller of any or all of the Purchased
Securities.

 

11.                               FURTHER ADJUSTMENTS TO BASE AGREEMENT

 

The following additional
provisions of the Base Agreement are deemed deleted and/or superseded by this
Annex:  Subclause (B) of the last
sentence of Paragraph 5 (with the designation “(A)” to be removed from such
sentence), Paragraph 9, subclause (ii) of Paragraph 12 (with subclause (iii) being
redesignated as subclause (ii)), Paragraph 15, Paragraph 16, Paragraph 17 and
Paragraph 18.

 

12.                               MISCELLANEOUS

 

(a)                                  Setoff.  Without prejudice to the Liquidity Draw
Offset provision set forth in Paragraph
3(b)(viii), the rights and
obligations of the parties hereunder shall not be subject to, and shall not
form the basis for, any rights of setoff arising from a transaction not subject
to this Agreement; provided, that if on any day there are amounts
in the same currency payable both by the Buyer to the Seller and by the Seller
to the Buyer, in accordance with the Priority of Payments, such amounts may be
set off against one another and only a single net amount transferred by the
Buyer to the Seller, or by the Seller to the Buyer, as the case may be.

 

(b)                                 Subordination. 
The Buyer agrees any and all amounts payable to it by the Seller under
this Agreement and any Transaction Documents shall be paid to the Buyer only in
accordance with the Priority of Payments and (other than with respect to Dexia
Reimbursement Payments) satisfaction of the Subordinated Claims Payment
Condition specified therein.

 

(c)                                  Amendments and Waivers. 
No failure or delay on the part of the Buyer in exercising any power or
right hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power preclude any other or further
exercise thereof or the exercise of any other right or power hereunder.  No amendment, modification, supplement,
termination or waiver of any provision of this Agreement nor consent to any
departure by the Seller herefrom or therefrom shall in any event be effective
unless the same shall be in writing and signed by the Buyer, the Seller and
FSA.  Any such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.  No notice to or demand on the
Seller in any case shall, of itself, entitle the Seller to any other or further
notice or demand in similar or other circumstances.  Notwithstanding the foregoing, any amendment,
modification, supplement, termination or waiver of any provision of this
Agreement entered into by the Buyer and the Seller without the prior written
consent of FSA shall be void ab initio.

 

15

 

(d)                                 Third Party Beneficiary. 
Each of FSA and the Collateral Agent shall be a third party beneficiary
of the provisions of this Agreement setting forth rights of FSA or the Collateral
Agent, respectively.

 

(e)                                  Successors and Assigns.  This Agreement shall inure to
the benefit of, and shall be enforceable by, the parties hereto and their
respective successors and permitted assigns. 
Neither
this Agreement nor any interest or obligation in or under this Agreement may be
assigned or transferred (whether by way of security or otherwise) by the Buyer
without the consent of the Seller and FSA (other than for DCL to make an
assignment or transfer to DBB or DBB to make an assignment or transfer to DCL),
other than

 

(I) pursuant to a consolidation with, or
merger with or into, or transfer of all or substantially all its assets to,
another entity (a “Corporate Reorganization”), provided that the Remedies
Nonimpairment Condition (as defined in the Pledge and Administration Agreement)
is satisfied in relation to such Corporate Reorganization; or

 

(II)  pursuant
to an assignment of its rights and obligations hereunder in whole or in part by
the Buyer (the “Assigning Buyer”) to an Affiliate of such Buyer (a “Transferee
Buyer”) where (i)(a) such Transferee Buyer has a rating assigned by Moody’s
to its long-term indebtedness and its short-term indebtedness at least as high
as the rating assigned by Moody’s to the long-term indebtedness and short-term
indebtedness of the Assigning Buyer, and (b) such Transferee Buyer has a
rating assigned by S&P to its long-term indebtedness and its short-term
indebtedness at least as high as the rating assigned by S&P to the
long-term indebtedness and short-term indebtedness of the Assigning Buyer, in
each case on the date of the proposed assignment, (ii) the Assigning Buyer
receives confirmation from Moody’s and S&P that none of the ratings of the
Transferee Buyer referred to in clause (i) above will be reduced or
withdrawn after giving effect to the proposed assignment (or if reduced, will
be reduced to a rating subcategory not lower than the corresponding rating
subcategory of the Assigning Buyer (and for this purpose a rating of the same
subcategory which is on negative watch or watch for downgrade shall be
considered lower than a rating of the same subcategory that is not on negative
watch or watch for downgrade)), (iii) if the Transferee Buyer would be
located in a different jurisdiction than the Assigning Buyer (and is not
located in Belgium or France), the Remedies Nonimpairment Condition is
satisfied in relation to such assignment, (iv) the relevant Unutilized
Commitment of the Assigning Buyer is $1.5 billion or less at the time of such
assignment and (v) after giving effect to such assignment there would be
no more than three different Buyers having a separate Unutilized Commitment
hereunder.

 

The Seller may not
assign or otherwise transfer any of its rights or obligations under this
Agreement without the prior written consent of the Buyer, and any purported
assignment without such consent shall be void.

 

(f)                                    Costs, Expenses and Taxes.  The Seller agrees to pay on
demand all costs and expenses of the Buyer, including reasonable fees and
expenses of counsel, in connection with the enforcement against it of this
Agreement and the protection of the Buyers’ rights hereunder and 

 

16

 

thereunder, including any bankruptcy, insolvency,
enforcement proceedings or restructuring with respect to the Seller, in each
case subject to the Priority of Payments and satisfaction of the Subordinated
Claims Payment Condition specified therein. 
In addition, the Seller shall pay any and all stamp and other taxes and
fees payable or determined to be payable in connection with the execution,
delivery, filing and recording of this Agreement, and agrees to save the Buyer
harmless from and against any and all liabilities with respect to or resulting
from any delay in paying or omission to pay such taxes and fees, in each case subject to the Priority of Payments and
satisfaction of the Subordinated Claims Payment Condition specified therein.

 

(g)                                 Acknowledgement of Security Interests. 
The Buyer hereby acknowledges that the Seller is granting a security
interest in its rights under this Agreement to the Collateral Agent on behalf
of the Secured Parties (including FSA) to secure its obligations under the
Pledge and Administration Agreement and the Transactions Documents, and the
Buyer hereby consents to any transfer of any or all of such rights in
connection with the enforcement of such security interests.

 

(h)                                 Governing Law.  Governing
Law.  THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES OTHER THAN SECTIONS 5-1401 AND
5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK AND THE
MANDATORY CHOICE OF LAW RULES CONTAINED IN THE UCC.  Each of the parties hereto hereby irrevocably
submits to the exclusive jurisdiction of any U.S. federal or state court in The
City of New York for the purpose of any suit, action, proceeding or judgment
arising out of or relating to this Agreement. 
Each of the parties hereto hereby consents to the laying of venue in any
such suit, action or proceeding in New York County, New York, and hereby
irrevocably waives any claim that any such suit, action or proceeding brought
in such a court has been brought in an inconvenient forum and agrees not to
plead or claim the same.  Notwithstanding
the foregoing, nothing contained in this Agreement shall limit or affect the
rights of any party hereto to exercise remedies under this Agreement or any of
the other Transaction Documents, or to enforce any judgment with respect thereto,
in any jurisdiction or venue.  Any
process in any such action shall be duly served if mailed by registered mail,
postage prepaid, with respect to (i) the Seller, at its address designated
pursuant to Annex 2 to the Agreement and (ii) with respect to the Buyer,
the Buyer hereby irrevocably appoints Dexia Crédit Local New York Branch (the “Process
Agent”), at 445 Park Avenue, 7th Floor, New York, NY 10022, as its agent to
receive, on behalf of the Buyer and its property, service of copies of the
summons and complaint and any other process which may be served in any such
action or proceeding.  Such service may
be made by mailing or delivering a copy of such process to the Buyer in care of
the Process Agent at the Process Agent’s above address, and the Buyer hereby
irrevocably authorizes and directs the Process Agent to accept such service on
its behalf.  The Buyer may appoint a
replacement Process Agent with an office in the State of New York by notice to
FSA.

 

(i)                                     WAIVER OF JURY
TRIAL.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES
ANY RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATING TO THIS AGREEMENT
OR THE TRANSACTIONS 

 

17

 

CONTEMPLATED HEREBY.  EACH PARTY
ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION
FOR THIS PROVISION.

 

(j)                                     Sovereign
Immunity.  To the
extent that the parties hereto, or any of their respective properties, assets
or revenues may have or may hereafter become entitled to, or have attributed to
them, any right of immunity, on the grounds of sovereignty or otherwise, from
any legal action, suit or proceeding, from the giving of any relief in any
respect thereof, from setoff or counterclaim, from the jurisdiction of any
court, from service of process, from attachment upon or prior to judgment, from
attachment in aid of execution of judgment, or from execution of judgment, or
other legal process or proceeding for the giving of any relief or for the
enforcement of any judgment, in any jurisdiction in which proceedings may at
any time be commenced, with respect to its obligations, liabilities or any
other matter under or arising out of or in connection with this Agreement, the
parties hereto hereby irrevocably and unconditionally waive, and agree not to plead
or claim, to the fullest extent permitted by applicable law, any such immunity
and consent to such relief and enforcement.

 

(k)                                  Non-Petition.  The Buyer agrees that it will not, prior to the Senior
Release Date, acquiesce, petition or otherwise institute against, or join any
other person in instituting against, the Seller, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any federal or state bankruptcy, or similar law, including
without limitations proceedings seeking to appoint a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other similar official of the
Seller or any substantial part of its property; provided, that this
provision shall not restrict or prohibit the Buyer from joining any such
proceedings which shall have already commenced under applicable laws and not in
violation of this provision.  This
provision shall survive the termination of this Agreement for any reason.

 

(l)                                     Limited Recourse. 
The obligations of the Seller in relation to this Agreement and any
Transaction hereunder are limited recourse obligations, payable solely from the
proceeds of the FSAM Collateral available under and applied in accordance with
the Priority of Payments and (other than with respect to Dexia Reimbursement
Payments) subject to the satisfaction of the Subordinated Claims Payment
Condition specified therein.  Upon
application of the FSAM Collateral and proceeds thereof available to satisfy
the obligations of the Seller hereunder in accordance with the Pledge and
Administration Agreement, the Buyer shall not be entitled to take any further
steps against the Seller to recover any sums due and shall not constitute a
claim against the Seller to the extent of any insufficiency.  No recourse shall be had for the payment of
any amounts owing in respect of this Agreement against any officer, director,
employee, stockholder, member or incorporator of the Seller.  This provision shall survive the termination
of this Agreement for any reason.  The
Buyer shall have no right to commence or maintain any action, suit or
proceeding against Seller arising out of any breach of this Agreement by Seller
for any reason, but such provision shall be without prejudice to the rights of
the Buyer to indemnification in accordance with Paragraph 3(g).

 

(m)                               Counterparts. 
This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if all signatures thereon
were upon the same instrument.  This
Agreement constitutes the entire agreement and understanding between the Seller

 

18

 

and the Buyer with respect to the subject matter hereof, and supersedes
any prior agreements and understandings with respect thereto.

 

(n)                                 Notices.  The words “mail,
electronic mail, fascsimile” are deemed to replace the words “mail, facsimile”
in Paragraph 13.  The last sentence of
Paragraph 13 is deemed deleted.

 

19

 

IN WITNESS WHEREOF, the parties hereto have caused
this Committed Term Repurchase Agreement Annex to be executed by their
respective corporate officers, thereunto duly authorized, as of June 30,
2009.

 

 

	
  DEXIA CRÉDIT LOCAL S.A.

  	
  FSA ASSET
  MANAGEMENT LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Title:

  	
  Title:

  
					

 

20

 

SCHEDULE
A TO ANNEX 1 — ELIGIBLE SECURITIES

 

	
  Security Type:

  	
   

  	
  Priority

  Category:

  
	
  U.S. Treasury Bonds, Bills and Notes, or other direct
  obligations of, or obligations guaranteed by, the U.S. Government

  	
   

  	
  2

  
	
  Fannie Mae, FHLMC and GNMA debt or agency RMBS or CMBS
  securities

  	
   

  	
  2

  
	
  Other RMBS or CMBS

  	
   

  	
  4

  
	
  Credit Card ABS

  	
   

  	
  4

  
	
  Auto Loan ABS

  	
   

  	
  4

  
	
  Student Loan ABS

  	
   

  	
  4

  
	
  Municipal Bonds

  	
   

  	
  1

  
	
  CLO/CDO Securities

  	
   

  	
  4

  
	
  Corporate Bonds

  	
   

  	
  3

  
	
  Military Housing Bonds

  	
   

  	
  5

  
	
  Domestic and International Project Finance Bonds

  	
   

  	
  5

  
	
  Domestic Utility Bonds

  	
   

  	
  5

  
	
  NIMs

  	
   

  	
  5

  
	
  “Triple-X” Bonds

  	
   

  	
  5

  
	
  “Refi” Bonds

  	
   

  	
  5

  
	
  Westlake Facility

  	
   

  	
  5

  
	
  Other Securities owned by Borrower

  	
   

  	
  Deemed to have
  lowest Priority Category.

  

 

21Exhibit 10.3.1

 

(Multicurrency—Cross
Border)

 

ISDAÒ

International
Swap Dealers Association, Inc.

 

MASTER
AGREEMENT

 

dated
as of June 30, 2009

 

	
  DEXIA SA and DEXIA CRÉDIT
  LOCAL

  S.A., jointly and severally;

  	
  and

  	
  FSA ASSET MANAGEMENT LLC

  

 

have entered and/or anticipate entering into one or
more transactions (each a “Transaction”) that are or will be governed by this
Master Agreement, which includes the schedule (the “Schedule”), and the
documents and other confirming evidence (each a “Confirmation”) exchanged between
the parties confirming those Transactions.

 

Accordingly, the parties agree as follows:—

 

1.                                      Interpretation

 

(a)                                  Definitions. The terms defined in Section 14 and in the
Schedule will have the meanings therein specified for the purpose of this
Master Agreement.

 

(b)                                 Inconsistency. In the event of any inconsistency between the
provisions of the Schedule and the other provisions of this Master Agreement,
the Schedule will prevail.  In the event
of any inconsistency between the provisions of any Confirmation and this Master
Agreement (including the Schedule), such Confirmation will prevail for the
purpose of the relevant Transaction.

 

(c)                                  Single Agreement. All Transactions are entered into in reliance on the
fact that this Master Agreement and all Confirmations form a single agreement
between the parties (collectively referred to as this “Agreement”), and the
parties would not otherwise enter into any Transactions.

 

2.                                      Obligations

 

(a)                                  General Conditions.

 

(i)                  Each party will make each payment
or delivery specified in each Confirmation to be made by it, subject to the
other provisions of this Agreement.

 

(ii)               Payments under this Agreement will
be made on the due date for value on that date in the place of the account
specified in the relevant Confirmation or otherwise pursuant to this Agreement,
in freely transferable funds and in the manner customary for payments in the
required currency. Where settlement is by delivery (that is, other than by
payment), such delivery will be made for receipt on the due date in the manner
customary for the relevant obligation unless otherwise specified in the relevant
Confirmation or elsewhere in this Agreement.

 

(iii)             Each obligation of
each party under Section 2(a)(i) is subject to (1) the condition
precedent that no Event of Default or Potential Event of Default with respect
to the other party has occurred and is continuing, (2) the condition
precedent that no Early Termination Date in respect of the relevant Transaction
has occurred or been effectively designated and (3) each other applicable condition
precedent specified in this Agreement.

 

Copyright © 1992 by
International Swap Dealers Association, Inc.

 

 

(b)                                 Change of Account. Either party may change its account for receiving a
payment or delivery by giving notice to 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 respect to a party to this Agreement) or (II) a
Change in Tax Law.

 

2

 

(ii)               Liability. If:—

 

(1)                   X is required by any applicable
law, as modified by the practice of any relevant governmental revenue
authority, to make any deduction or withholding in respect of which X would not
be required to pay an additional amount to Y under Section 2(d)(i)(4);

 

(2)                   X does not so deduct or withhold;
and

 

(3)                   a liability resulting from such Tax
is assessed directly against X,

 

then, except to the extent Y has satisfied or then
satisfies the liability resulting from such Tax, Y will promptly pay to X the
amount of such liability (including any related liability for interest, but including
any related liability for penalties only if Y has failed to comply with or
perform any agreement contained in Section 4(a)(i), 4(a)(iii) or
4(d)).

 

(e)                                  Default Interest; Other
Amounts.
Prior to the occurrence or effective designation of an Early Termination Date
in respect of the relevant Transaction, a party that defaults in the
performance of any payment obligation will, to the extent permitted by law and
subject to Section 6(c), be required to pay interest (before as well as
after judgment) on the overdue amount to the other party on demand in the same
currency as such overdue amount, for the period from (and including) the
original due date for payment to (but excluding) the date of actual payment, at
the Default Rate. Such interest will be calculated on the basis of daily
compounding and the actual number of days elapsed. If, prior to the occurrence
or effective designation of an Early Termination Date in respect of the
relevant Transaction, a party defaults in the performance of any obligation
required to be settled by delivery, it will compensate the other party on
demand if and to the extent provided for in the relevant Confirmation or
elsewhere in this Agreement.

 

3.                                      Representations

 

Each party represents to the other party (which representations will be
deemed to be repeated by each party on each date on which a Transaction is
entered into and, in the case of the representations in Section 3(f), at all
times until the termination of this Agreement) that:—

 

(a)                                  Basic Representations.

 

(i)                  Status. It is duly organised
and validly existing under the laws of the jurisdiction of its organisation 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 equity or at law)).

 

3

 

(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 party reasonably directs:—

 

(i)                  any forms, documents or
certificates relating to taxation specified in the Schedule or any Confirmation;

 

(ii)               any other documents specified in
the Schedule or any Confirmation; and

 

(iii)            upon reasonable demand by such
other party, any form or document that may be required or reasonably requested
in writing in order to allow such other party or its Credit Support Provider to
make a payment under this Agreement or any applicable Credit Support Document
without any deduction or withholding for or on account of any Tax or with such
deduction or withholding at a reduced rate (so long as the completion,
execution or submission of such form or document would not materially prejudice
the legal or commercial position of the party in receipt of such demand), with
any such form or document to be accurate and completed in a manner reasonably
satisfactory to such other party and to be executed and to be delivered with
any reasonably required certification,

 

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

 

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

 

(c)                                  Comply with Laws. It will comply in all material 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) to be accurate and true
promptly upon learning of such failure.

 

(e)                                  Payment of Stamp Tax. Subject to Section 11, it will pay
any Stamp Tax levied or imposed upon it or in respect of its execution or
performance of this Agreement by a jurisdiction in which it is incorporated, organised,
managed and controlled, or considered to have its seat, or in which a branch or
office through 

 

4

 

which it is acting for the purpose of this Agreement is located (“Stamp
Tax Jurisdiction”) and will indemnify the other party against any Stamp Tax
levied or imposed upon the other party or in respect of the other party’s execution
or performance of this Agreement by any such Stamp Tax Jurisdiction which is
not also a Stamp Tax Jurisdiction with respect to the other party.

 

5.                                      Events of Default and
Termination Events

 

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

 

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

 

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

 

(iii)            Credit
Support Default.

 

(1)                   Failure by the party or any Credit
Support Provider of such party to comply with or perform any agreement or
obligation to be complied with or performed by it in accordance with any Credit
Support Document if such failure is continuing after any applicable grace period
has elapsed;

 

(2)                   the expiration or termination of
such Credit Support Document or the failing or ceasing of such Credit Support
Document to be in full force and effect for the purpose of this Agreement (in
either case other than in accordance with its terms) prior to the satisfaction
of all obligations of such party under each Transaction to which such Credit
Support Document relates without the written consent of the other party; or

 

(3)                   the party or such Credit Support
Provider disaffirms, disclaims, repudiates or rejects, in whole or in part, or
challenges the validity of, such Credit Support Document;

 

(iv)           Misrepresentation. A representation
(other than a representation under Section 3(e) or (f)) made or
repeated or deemed to have been made or repeated by the party or any Credit
Support Provider of such party in this Agreement or any Credit Support Document
proves to have been incorrect or misleading in any material respect when made
or repeated or deemed to have been made or repeated;

 

(v)              Default
under Specified Transaction. 
The party, any Credit Support Provider of such party or any applicable
Specified Entity of such party (1) defaults under a Specified Transaction
and, after giving effect to any applicable notice requirement or grace period,
there occurs a liquidation of, an acceleration of obligations under, or an
early termination of, that Specified Transaction, (2) defaults, after
giving effect to any applicable notice requirement or grace period, in making
any payment or delivery due on the last payment, delivery or exchange date of,
or any payment on early termination of, a Specified Transaction (or such
default continues for at least three Local Business Days if there is no
applicable notice requirement or grace period) or (3) disaffirms,
disclaims, repudiates or rejects, in whole or in part, a Specified Transaction
(or such action is taken by any person or entity appointed or empowered to
operate it or act on its behalf);

 

(vi)           Cross Default.  If “Cross Default” is specified in
the Schedule as applying to the party, the occurrence or existence of (1) a
default, event of default or other similar condition or event (however

 

5

 

described) in respect of such party, any Credit Support Provider of such
party or any applicable Specified Entity of such party under one or more
agreements or instruments relating to Specified Indebtedness of any of them
(individually or collectively) in an aggregate amount of not less than the
applicable Threshold Amount (as specified in the Schedule) which has resulted
in such Specified Indebtedness becoming, or becoming capable at such time of
being declared, due and payable under such agreements or instruments, before it
would otherwise have been due and payable or (2) a default by such party,
such Credit Support Provider or such Specified Entity (individually or
collectively) in making one or more payments on the due date thereof in an
aggregate amount of not less than the applicable Threshold Amount under such
agreements or instruments (after giving effect to any applicable notice
requirement or grace period);

 

(vii)        Bankruptcy. The party, any Credit
Support Provider of such party or any applicable Specified Entity of such
party:—

 

(1) is dissolved (other than pursuant to a consolidation,
amalgamation or merger); (2) becomes insolvent or is unable to pay its
debts or fails or admits in writing its inability generally to pay its debts as
they become due; (3) makes a general assignment, arrangement or
composition with or for the benefit of its creditors; (4) institutes or
has instituted against it a proceeding seeking a judgment of insolvency or
bankruptcy or any other relief under any bankruptcy or insolvency law or other
similar law affecting creditors’ rights, or a petition is presented for its winding-up
or liquidation, and, in the case of any such proceeding or petition instituted
or presented against it, such proceeding or petition (A) results in a
judgment of insolvency or bankruptcy or the entry of an order for relief or the
making of an order for its winding-up or liquidation or (B) is not
dismissed, discharged, stayed or restrained in each case within 30 days  of the institution or presentation thereof; (5) has
a resolution passed for its winding-up, official management or liquidation
(other than pursuant to a consolidation, amalgamation or merger); (6) seeks
or becomes subject to the appointment of an administrator, provisional
liquidator, conservator, receiver, trustee, custodian or other similar official
for it or for all or substantially all its assets; (7) has a secured party
take possession of all or substantially all its assets or has a distress,
execution, attachment, sequestration or other legal process levied, enforced or
sued on or against all or substantially all its assets and such secured party
maintains possession, or any such process is not dismissed, discharged, stayed
or restrained, in each case within 30 days thereafter; (8) causes or is
subject to any event with respect to it which, under the applicable laws of any
jurisdiction, has an analogous effect to any of the events specified in clauses
(1) to (7) inclusive); or (9) takes any action in furtherance
of, or indicating its consent to, approval of, or acquiescence in, any of the
foregoing acts; or

 

(viii)     Merger Without Assumption. The party or any
Credit Support Provider of such party consolidates or amalgamates with, or
merges with or into, or transfers all or substantially all its assets to,
another entity and, at the time of such consolidation, amalgamation, merger or
transfer:—

 

(1)                   the resulting, surviving or
transferee entity fails to assume all the obligations of such party or such
Credit Support Provider under this Agreement or any Credit Support Document to which
it or its predecessor was a party by operation of law or pursuant to an
agreement reasonably satisfactory to the other party to this Agreement; or

 

(2)                   the benefits of any Credit Support
Document fail to extend (without the consent of the other party) to the
performance by such resulting, surviving or transferee entity of its
obligations under this Agreement.

 

(b)                                 Termination Events. The occurrence at any time with respect to a party or,
if applicable, any Credit Support Provider of such party or any Specified
Entity of such party of any event specified below constitutes an Illegality if
the event is specified in (i) below, a Tax Event if the event is specified
in (ii) below or a Tax Event Upon Merger if the event is specified in (iii) below,
and, if specified to be applicable, a Credit Event 

 

6

 

Upon Merger if the event is specified pursuant to (iv) below or an
Additional Termination Event if the event is specified pursuant to (v) below:—

 

(i)                  Illegality.  Due to the adoption of, or any
change in, any applicable law after the date on which a Transaction is entered
into, or due to the promulgation of, or any change in, the interpretation by any
court, tribunal or regulatory authority with competent jurisdiction of any
applicable law after such date, it becomes unlawful (other than as a result of
a breach by the party of Section 4(b)) for such party (which will be the
Affected Party):—

 

(1)                   to perform any absolute or
contingent obligation to make a payment or delivery or to receive a payment or
delivery in respect of such Transaction or to comply with any other material
provision of this Agreement relating to such Transaction; or

 

(2)                   to perform, or for any Credit
Support Provider of such party to perform, any contingent or other obligation
which the party (or such Credit Support Provider) has under any Credit Support
Document relating to such Transaction;

 

(ii)               Tax
Event. Due to (x) any action taken by a taxing authority, or
brought in a court of competent jurisdiction, on or after the date on which a
Transaction is entered into (regardless of whether such action is taken or
brought with respect to a party to this Agreement) or (y) a Change in Tax
Law, the party (which will  be the
Affected Party) will, or there is a substantial likelihood that it will, on the
next succeeding Scheduled Payment Date (1) be required to pay to the other
party an additional amount in respect of an Indemnifiable Tax under Section 2(d)(i)(4) (except
in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive
a payment from which an amount is required to be deducted or withheld for or on
account of a Tax (except in respect of interest under Section 2(e), 6(d)(ii) or
6(e)) and no additional amount is required to be paid in respect of such Tax
under Section 2(d)(i)(4) (other than by reason of Section 2(d)(i)(4)(A) or
(B));

 

(iii)            Tax
Event Upon Merger. The party (the “Burdened Party”)
on the next succeeding Scheduled Payment Date will either (1) be required
to pay an additional amount in respect of an Indemnifiable Tax under Section 2(d)(i)(4) (except
in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive
a payment from which an amount has been deducted or withheld for or on account
of any Indemnifiable Tax in respect of which the other party is not required to
pay an additional amount (other than by reason of Section 2(d)(i)(4)(A) or
(B)), in either case as a result of a party consolidating or amalgamating with,
or merging with or into, or transferring all or substantially all its assets
to, another entity (which will be the Affected Party) where such action does
not constitute an event described in Section 5(a)(viii);

 

(iv)           Credit Event Upon Merger. If “Credit Event Upon
Merger” is specified in the Schedule as applying to the party, such party (“X”),
any Credit Support Provider of X or any applicable Specified Entity of X consolidates
or amalgamates with, or merges with or into, or transfers all or substantially
all its assets to, another entity and such action does not constitute an event
described in Section 5(a)(viii) but the  creditworthiness of the resulting, surviving
or transferee entity is materially weaker than that of X, such Credit Support
Provider or such Specified Entity, as the case may be, immediately prior to
such action (and, in such event, X or its successor or transferee, as
appropriate, will be the Affected Party); or

 

(v)              Additional Termination Event. If any “Additional
Termination Event” is specified in the Schedule or any Confirmation as
applying, the occurrence of such event (and, in such event, the Affected Party
or Affected Parties shall be as specified for such Additional Termination Event
in the Schedule or such Confirmation).

 

(c)                                  Event of Default and
Illegality. If an
event or circumstance which would otherwise constitute or give rise to an Event
of Default also constitutes an Illegality, it will be treated as an Illegality
and will not constitute an Event of Default.

 

7

 

6.                                      Early Termination

 

(a)                                  Right to Terminate
Following Event of Default.  If at
any time an Event of Default with respect to a party (the “Defaulting Party”)
has occurred and is then continuing, the other party (the “Non-defaulting Party”
may, by not more than 20 days notice to the Defaulting Party specifying the
relevant Event of Default, designate a day not earlier than the day such notice
is effective as an Early Termination Date in respect of all outstanding
Transactions. If, however, “Automatic Early Termination” is specified in the
Schedule as applying to a party, then an Early Termination Date in respect of
all outstanding Transactions will occur immediately upon the occurrence with
respect to such party of an Event of Default specified in Section 5(a)(vii)(1),
(3), (5), (6) or, to the extent analogous thereto, (8), and as of the time
immediately preceding the institution of the relevant proceeding or the
presentation of the relevant petition upon the occurrence with respect to such
party of an Event of Default specified in Section 5(a)(vii)(4) or, to
the extent analogous thereto, (8).

 

(b)                                 Right to Terminate
Following Termination Event.

 

(i)                  Notice. If a Termination
Event occurs, an Affected Party will, promptly upon becoming aware of it,
notify the other party, specifying the nature of that Termination Event and
each Affected Transaction and will also give such other information about that
Termination Event as the other party may reasonably require.

 

(ii)               Transfer
to Avoid Termination Event. If either an Illegality under Section 5(b)(i)(1) or
a Tax Event occurs and there is only one Affected Party, or if a Tax Event Upon
Merger occurs and the Burdened Party is the Affected Party, the Affected Party
will, as a condition to its right to designate an Early Termination Date under Section 6(b)(iv),
use all reasonable efforts (which will not require  such party to incur a loss, excluding
immaterial, incidental expenses) to transfer within 20 days after it gives
notice under Section 6(b)(i) all its rights and obligations under
this Agreement in respect of the Affected Transactions to another of its
Offices or Affiliates so that such Termination Event ceases to exist.

 

If the Affected Party is not able to make such a
transfer it will give notice to the other party to that effect within such 20
day period, whereupon the other party may effect such a transfer within 30 days
after the notice is given under Section 6(b)(i).

 

Any such transfer by a party under this Section 6(b)(ii) will
be subject to and conditional upon the prior written consent of the other
party, which consent will not be withheld if such other party’s policies in
effect at such time would permit it to enter into transactions with the
transferee on the terms proposed.

 

(iii)            Two Affected Parties. If an Illegality
under Section 5(b)(i)(1) or a Tax Event occurs and there are two
Affected Parties, each party will use all reasonable efforts to reach agreement
within 30 days after notice thereof is given under Section 6(b)(i) on
action to avoid that Termination Event.

 

(iv)           Right to Terminate. If:—

 

(1)                   a transfer under Section 6(b)(ii) or
an agreement under Section 6(b)(iii), as the case may be, has not been
effected with respect to all Affected Transactions within 30 days after an Affected
Party gives notice under Section 6(b)(i); or

 

(2)                   an Illegality under Section 5(b)(i)(2),
a Credit Event Upon Merger or an Additional Termination Event occurs, or a Tax
Event Upon Merger occurs and the Burdened Party is not the Affected Party,

 

either party in the case of an Illegality, the
Burdened Party in the case of a Tax Event Upon Merger, any Affected Party in
the case of a Tax Event or an Additional Termination Event if there is more than
one Affected Party, or the party which is not the Affected Party in the case of
a Credit Event Upon Merger or an Additional Termination Event if there is only
one Affected Party may, by not more than 20 days notice to the other party and
provided that the relevant Termination Event is then 

 

8

 

continuing, designate a day not earlier than the day
such notice is effective as an Early Termination Date in respect of all
Affected Transactions.

 

(c)                                  Effect of Designation.

 

(i)                  If notice designating an Early
Termination Date is given under Section 6(a) or (b), the Early Termination
Date will occur on the date so designated, whether or not the relevant Event of
Default or Termination Event is then continuing.

 

(ii)               Upon the occurrence or effective
designation of an Early Termination Date, no further payments or deliveries
under Section 2(a)(i) or 2(e) in respect of the Terminated
Transactions will be required to be made, but without prejudice to the other
provisions of this Agreement. The amount, if any, payable in respect of an
Early Termination Date shall be determined pursuant to Section 6(e).

 

(d)                                 Calculations.

 

(i)                  Statement.  On
or as soon as reasonably practicable following the occurrence of an Early Termination
Date, each party will make the calculations on its part, if any, contemplated
by Section 6(e) and will provide to the other party a statement (1) showing,
in reasonable detail, such calculations (including all relevant quotations and
specifying any amount payable under Section 6(e)) and (2) giving details
of the relevant account to which any amount payable to it is to be paid. In the
absence of written confirmation from the source of a quotation obtained in
determining a Market Quotation, the records of the party obtaining such
quotation will be conclusive evidence of the existence and accuracy of such quotation.

 

(ii)               Payment
Date. An amount calculated as being due in respect of any Early
Termination Date under Section 6(e) will be payable on the day that
notice of the amount payable is effective (in the case of an Early Termination
Date which is designated or occurs as a result of an Event of Default) and on
the day which is two Local Business Days after the day on which notice of the
amount payable is effective (in the case of an Early Termination Date which is
designated as a result of a Termination Event). Such amount will be paid
together with (to the extent permitted under applicable law) interest thereon
(before as well as after judgment) in the Termination Currency, from (and
including) the relevant Early Termination Date to (but excluding) the date such
amount is paid, at the Applicable Rate. Such interest will be calculated on the
basis of daily compounding and the actual number of days elapsed.

 

(e)                                  Payments on Early
Termination. If an
Early Termination Date occurs, the following provisions shall apply based on
the parties’ election in the Schedule of a payment measure, either “Market
Quotation” or “Loss”, and a payment method, either the “First Method” or the “Second
Method”. If the parties fail to designate a payment measure or payment method
in the Schedule, it will be deemed that “Market Quotation” or the “Second
Method”, as the case may be, shall apply. The amount, if any, payable in
respect of an Early Termination Date and determined pursuant to this Section will
be subject to any Set-off.

 

(i)                 Events
of Default. If the Early Termination Date
results from an Event of Default:—

 

(1)                   First Method
and Market Quotation. If the First Method and Market Quotation apply, the
Defaulting Party will pay to the Non-defaulting Party the excess, if a positive
number, of (A) the sum of the Settlement Amount (determined by the
Non-defaulting Party) in respect of the Terminated Transactions and the
Termination Currency Equivalent of the Unpaid Amounts owing to the
Non-defaulting Party over (B) the Termination Currency Equivalent of the
Unpaid Amounts owing to the Defaulting Party.

 

(2)                   First Method
and Loss. If the First Method and Loss apply, the Defaulting Party
will pay to the Non-defaulting Party, if a positive number, the Non-defaulting
Party’s Loss in respect of this Agreement.

 

(3)                   Second Method
and Market Quotation. If the Second Method and Market Quotation apply, an
amount will be payable equal to (A) the sum of the Settlement Amount
(determined by the 

 

9

 

Non-defaulting Party) in respect of the Terminated
Transactions and the Termination Currency Equivalent of the Unpaid Amounts
owing to the Non-defaulting Party less (B) the Termination Currency
Equivalent of the Unpaid Amounts owing to the Defaulting Party. If that amount
is a positive number, the Defaulting Party will pay it to the Non-defaulting
Party; if it is a negative number, the Non-defaulting Party will pay the
absolute value of that amount to the Defaulting Party.

 

(4)                   Second Method
and Loss. If the Second Method and Loss apply, an amount will be
payable equal to the Non-defaulting Party’s Loss in respect of this Agreement.
If that amount is a positive number, the Defaulting Party will pay it to the
Non-defaulting Party; if it is a negative number, the Non-defaulting Party will
pay the absolute value of that amount to the Defaulting Party.

 

(ii)              Termination Events. If the Early
Termination Date results from a Termination Event:—

 

(1)                   One Affected
Party. If there is one Affected Party, the amount payable will be determined in
accordance with Section 6(e)(i)(3), if Market Quotation applies, or Section 6(e)(i)(4),
if Loss applies, except that, in either case, references to the Defaulting
Party and to the Non-defaulting Party will be deemed to be references to the
Affected Party and the party which is not the Affected Party, respectively,
and, if Loss applies and fewer than all the Transactions are being terminated,
Loss shall be calculated in respect of all Terminated Transactions.

 

(2)                   Two Affected
Parties. If there are two Affected Parties:—

 

(A)          if Market Quotation applies, each
party will determine a Settlement Amount in respect of the Terminated
Transactions, and an amount will be payable equal to (I) the sum of (a) one-half
of the difference between the Settlement Amount of the party with the higher
Settlement Amount (“X”) and the Settlement Amount of the party with the lower
Settlement Amount (“Y”) and (b) the Termination Currency Equivalent of the
Unpaid Amounts owing to X less (II) the Termination Currency Equivalent of
the Unpaid Amounts owing to Y; and

 

(B)            if Loss applies, each party will
determine its Loss in respect of this Agreement (or, if fewer than all the
Transactions are being terminated, in respect of all Terminated Transactions)
and an amount will be payable equal to one-half of the difference between the
Loss of the party with the higher Loss (“X”) and the Loss of the party with the
lower Loss (“Y”).

 

If the amount payable is a positive number, Y will
pay it to X; if it is a negative number, X will pay the absolute value of that
amount to Y.

 

(iii)           Adjustment for Bankruptcy. In circumstances
where an Early Termination Date occurs because “Automatic Early Termination”
applies in respect of a party, the amount determined under this Section 6(e) will
be subject to such adjustments as are appropriate and permitted by law to reflect
any payments or deliveries made by one party to the other under this Agreement
(and retained by such other party) during the period from the relevant Early
Termination Date to the date for payment determined under Section 6(d)(ii).

 

(iv)          Pre-Estimate. The parties agree
that if Market Quotation applies an amount recoverable under this Section 6(e) is
a reasonable pre-estimate of loss and not a penalty. Such amount is payable for
the loss of bargain and the loss of protection against future risks and except
as otherwise provided in this Agreement neither party will be entitled to
recover any additional damages as a consequence of such losses.

 

10

 

7.             Transfer

 

Subject to Section 6(b)(ii), neither this
Agreement nor any interest or obligation in or under this Agreement may be
transferred (whether by way of security or otherwise) by either party without
the prior written consent of the other party, except that:—

 

(a)           a party may make
such a transfer of this Agreement pursuant to a consolidation or amalgamation with,
or merger with or into, or transfer of all or substantially all its assets to,
another entity (but without prejudice to any other right or remedy under this
Agreement); and

 

(b)           a party may make
such a transfer of all or any part of its interest in any amount payable to it
from a Defaulting Party under Section 6(e).

 

Any purported transfer that is not in compliance
with this Section will be void.

 

8.             Contractual Currency

 

(a)           Payment
in the Contractual Currency. Each payment
under this Agreement will be made in the relevant currency specified in this
Agreement for that payment (the  “Contractual
Currency”). To the extent permitted by applicable law, any obligation to make
payments under this Agreement in the Contractual Currency will not be
discharged or satisfied by any tender in any currency other than the
Contractual Currency, except to the extent such tender results in the actual
receipt by the party to which payment is owed, acting in a reasonable manner
and in good faith in converting the currency so tendered into the Contractual Currency,
of the full amount in the Contractual Currency of all amounts payable in
respect of this Agreement. If for any reason the amount in the Contractual
Currency so received falls 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 in this Agreement, will be enforceable as separate and independent
causes of action, will apply notwithstanding any indulgence granted by the party
to which any payment is owed and will not be affected by judgment being
obtained or claim or proof being made for any other sums payable in respect of
this Agreement.

 

(d)           Evidence
of Loss. For the purpose of this Section 8, it will be
sufficient for a party to demonstrate that it would have suffered a loss had an
actual exchange or purchase been made.

 

11

 

9.             Miscellaneous

 

(a)           Entire
Agreement. This
Agreement constitutes the entire agreement and understanding of the parties with
respect to its subject matter and supersedes all oral communication and prior
writings with respect thereto.

 

(b)           Amendments. No amendment, modification or waiver in respect of this
Agreement will be effective unless in writing (including a writing evidenced by
a facsimile transmission) and executed by each of the parties or confirmed by
an exchange of telexes or electronic messages on an electronic messaging
system.

 

(c)           Survival
of Obligations. Without
prejudice to Sections 2(a)(iii) and 6(c)(ii), the obligations of the parties
under this Agreement will survive the termination of any Transaction.

 

(d)           Remedies
Cumulative. Except as
provided in this Agreement, the rights, powers, remedies and privileges
provided in this Agreement are cumulative and not exclusive of any rights,
powers, remedies and privileges provided by law.

 

(e)           Counterparts
and Confirmations.

 

(i)      This
Agreement (and each amendment, modification and waiver in respect of it) may be
executed and delivered in counterparts (including by facsimile transmission),
each of which will be deemed an original.

 

(ii)     The
parties intend that they are legally bound by the terms of each Transaction
from the moment they agree to those terms (whether orally or otherwise). A Confirmation
shall be entered into as soon as practicable and may be executed and delivered
in counterparts (including by facsimile transmission) or be created by an
exchange of telexes or by an exchange of electronic messages on an electronic
messaging system, which in each case will be sufficient for all purposes to
evidence a binding supplement to this Agreement. The parties will specify
therein or through another effective means that any such counterpart, telex or
electronic message constitutes a Confirmation.

 

(f)            No Waiver of Rights. A failure or delay in exercising any right, power or
privilege in respect of this Agreement will not be presumed to operate as a
waiver, and a single or partial exercise of any right, power or privilege will
not be presumed to preclude any subsequent or further exercise, of that right,
power or privilege or the exercise of any other right, power or privilege.

 

(g)           Headings. The headings used in this Agreement are for convenience of
reference only and are not to affect the construction of or to be taken into
consideration in interpreting this Agreement.

 

10.          Offices; Multibranch Parties

 

(a)           If Section 10(a) is
specified in the Schedule as applying, each party that enters into a
Transaction through an Office other than its head or home office represents to
the other party that, notwithstanding the place of booking office or
jurisdiction of incorporation or 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 

 

12

 

to which the Defaulting Party is a party or by
reason of the early termination of any Transaction, including, but not limited
to, costs of collection.

 

12.          Notices

 

(a)           Effectiveness. Any notice or other communication in respect of this
Agreement may be given in any manner set forth below (except that a notice or
other communication under Section 5 or 6 may not be given by facsimile
transmission or electronic messaging system) to the address or number or in
accordance with the electronic messaging system details provided (see the
Schedule) and will be deemed effective as indicated:—

 

(i)      if in
writing and delivered in person or by courier, on the date it is delivered;

 

(ii)     if
sent by telex, on the date the recipient’s answerback is received;

 

(iii)    if
sent by facsimile transmission, on the date that transmission is received by a
responsible employee of the recipient in legible form (it being agreed that the
burden of proving receipt will be on the sender and will not be met by a
transmission report generated by the sender’s facsimile machine);

 

(iv)    if sent
by certified or registered mail (airmail, if overseas) or the equivalent
(return receipt requested), on the date that mail is delivered or its delivery
is attempted; or

 

(v)     if sent
by electronic messaging system, on the date that electronic message is
received,

 

unless the date of 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 

 

13

 

reason any party’s Process Agent is unable to act as such, such party
will promptly notify the other party and within 30 days appoint a substitute
process agent acceptable to the other party. The parties irrevocably consent to
service of process given in the manner provided for notices in Section 12.
Nothing in this Agreement will affect the right of either party to serve
process in any other manner permitted by law.

 

(d)           Waiver
of Immunities. Each party
irrevocably waives, to the fullest extent permitted by applicable law, with
respect to itself and its revenues and assets (irrespective of their use or
intended use), all immunity on the grounds of sovereignty or other similar
grounds from (i) suit, (ii) jurisdiction of any court, (iii) relief
by way of injunction, order for specific performance or for recovery of
property, (iv) attachment of its assets (whether before or after judgment)
and (v) execution or enforcement of any judgment to which it or its revenues
or assets might otherwise be entitled in any Proceedings in the courts of any
jurisdiction and irrevocably agrees, to the extent permitted by applicable law,
that it will not claim any such immunity in any Proceedings.

 

14.          Definitions

 

As used in this Agreement:—

 

“Additional Termination Event” has the meaning
specified in Section 5(b).

 

“Affected Party” has the meaning
specified in Section 5(b).

 

“Affected Transactions” means (a) with
respect to any Termination Event consisting of an Illegality, Tax Event or Tax
Event Upon Merger, all Transactions affected by the occurrence of such
Termination Event and (b) with respect to any other Termination Event, all
Transactions.

 

“Affiliate” means, subject to the
Schedule, in relation to any person, any entity controlled, directly or indirectly,
by the person, any entity that controls, directly or indirectly, the person or
any entity directly or indirectly under common control with the person. For
this purpose, “control” of any entity or person means ownership of a majority
of the voting power of the entity or person.

 

“Applicable Rate” means:—

 

(a)     in
respect of obligations payable or deliverable (or which would have been but for
Section 2(a)(iii)) by a Defaulting Party, the Default Rate;

 

(b)     in
respect of an obligation to pay an amount under Section 6(e) of
either party from and after the date (determined in accordance with Section 6(d)(ii))
on which that amount is payable, the Default Rate;

 

(c)     in
respect of all other obligations payable or deliverable (or which would have
been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default
Rate; and

 

(d)     in all
other cases, the Termination Rate.

 

“Burdened Party” has the meaning
specified in Section 5(b).

 

“Change in Tax Law” means the enactment,
promulgation, execution or ratification of, or any change in or amendment to,
any law (or in the application or official interpretation of any law) that
occurs on or after the date on which the relevant Transaction is entered into.

 

“consent” includes a consent, approval,
action, 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.

 

14

 

“Defaulting Party” has the meaning
specified in Section 6(a).

 

“Early Termination Date” means the date
determined in accordance with Section 6(a) or 6(b)(iv).

 

“Event of Default” has the meaning
specified in Section 5(a) and, if applicable, in the Schedule.

 

“Illegality” has the meaning
specified in Section 5(b).

 

“Indemnifiable Tax” means any Tax other
than a Tax that would not be imposed in respect of a payment under this
Agreement but for a present or former connection between the jurisdiction of
the government or taxation authority imposing such Tax and the recipient of
such payment or a person related to such recipient (including, without
limitation, a connection arising from such recipient or related person being or
having been a citizen or resident of such jurisdiction, or being or having been
organised, present or engaged in a trade or business in such jurisdiction, or
having or having had a permanent establishment or fixed place of business in
such jurisdiction, but excluding a connection arising solely from such
recipient or related person having executed, delivered, performed its
obligations or received a payment under, or enforced, this Agreement or a
Credit Support Document).

 

“law” includes any treaty, law, rule or
regulation (as modified, in the case of tax matters, by the practice of any
relevant governmental revenue authority) and “lawful”
and “unlawful” will be construed
accordingly.

 

“Local Business Day” means, subject to the
Schedule, a day on which commercial banks are open for business (including
dealings in foreign exchange and foreign currency deposits) (a) in
relation to any obligation under Section 2(a)(i), in the place(s) specified
in the relevant Confirmation or, if not so specified, as otherwise agreed by
the parties in writing or determined pursuant to provisions contained, or
incorporated by reference, in this Agreement, (b) in relation to any other
payment, in the place where the relevant account is located and, if different,
in the principal financial centre, if any, of the currency of such payment, (c) in
relation to any notice or other communication, including notice contemplated
under Section 5(a)(i), in the city specified in the address for notice
provided by the recipient and, in the case of a notice contemplated by Section 2(b),
in the place where the relevant new account is to be located and (d) in
relation to Section 5(a)(v)(2), in the relevant locations for performance
with respect to such Specified Transaction.

 

“Loss” means, with respect to this
Agreement or one or more Terminated Transactions, as the case may be, and a
party, the Termination Currency Equivalent of an amount that party reasonably
determines in good faith to be its total losses and costs (or gain, in which
case expressed as a negative number) in connection with this Agreement or that
Terminated Transaction or group of Terminated Transactions, as the case may be,
including any loss of bargain, cost of funding or, at the election of such
party but without duplication, loss or cost incurred as a result of its
terminating, liquidating, obtaining or reestablishing any hedge or related
trading position (or any gain resulting from any of them). Loss includes losses
and costs (or gains) in respect of any payment or delivery required to have
been made (assuming satisfaction of each applicable condition precedent) on or
before the relevant Early Termination Date and not made, except, so as to avoid
duplication, if Section 6(e)(i)(1) or (3) or 6(c)(ii)(2)(A) applies.
Loss does not include a party’s legal fees and out-of-pocket expenses referred
to under Section 11. A party will determine its Loss as of the relevant
Early Termination Date, or, if that is not reasonably practicable, as of the
earliest date thereafter as is reasonably practicable. A party may (but need
not) determine its Loss by reference to quotations of relevant rates or prices
from one or more leading dealers in the relevant markets.

 

“Market Quotation” means, with respect
to one or more Terminated Transactions and a party making the determination, an
amount determined on the basis of quotations from Reference Market-makers. Each
quotation will be for an amount, if any, that would be paid to such party
(expressed as a negative number) or by such party (expressed as a positive
number) in consideration of an agreement between such party (taking into account
any existing Credit Support Document with respect to the obligations of such
party) and the quoting Reference Market-maker to enter into a transaction (the “Replacement
Transaction”) that would have the effect of preserving for such party the
economic equivalent of any payment or delivery (whether the underlying
obligation was absolute or contingent and assuming the satisfaction of each
applicable condition precedent) by the parties under Section 2(a)(i) in
respect of such Terminated Transaction or group of Terminated Transactions that
would, but for the occurrence of the relevant Early Termination Date, have

 

15

 

been required after that date. For this purpose,
Unpaid Amounts in respect of the Terminated Transaction or group of Terminated
Transactions are to be excluded but, without limitation, any payment or
delivery that would, but for the relevant Early Termination Date, have been
required (assuming satisfaction of each applicable condition precedent) after
that Early Termination Date is to be included. The Replacement Transaction
would be subject to such documentation as such party and the Reference
Market-maker may, in good faith, agree. The party making the determination (or
its agent) will request each Reference Market-maker to provide its quotation to
the extent reasonably practicable as of the same day and time (without regard
to different time zones) on or as soon as reasonably practicable after the
relevant Early Termination Date. The day and time as of which those quotations
are to be obtained will be selected in good faith by the party obliged to make
a determination under Section 6(e), and, if each party is so obliged,
after consultation with the other. If more than three quotations are provided,
the Market Quotation will be the arithmetic mean of the quotations, without
regard to the quotations having the highest and lowest values. If exactly three
such quotations are provided, the Market Quotation will be the quotation
remaining after disregarding the highest and lowest quotations. For this
purpose, if more than one quotation has the same highest value or lowest value,
then one of such quotations shall be disregarded. If fewer than three
quotations are provided, it will be deemed that the Market Quotation in respect
of such Terminated Transaction or group of Terminated Transactions cannot be
determined.

 

“Non-default Rate” means a rate per
annum equal to the cost (without proof or evidence of any actual cost) to the
Non-defaulting Party (as certified by it) if it were to fund the relevant
amount.

 

“Non-defaulting Party” has the meaning
specified in Section 6(a).

 

“Office” means a branch or office of a
party, which may be such party’s head or home office.

 

“Potential Event of Default” means any event
which, with the giving of notice or the lapse of time or both, would constitute
an Event of Default.

 

“Reference Market-makers” means four leading
dealers in the relevant market selected by the party determining a Market
Quotation in good faith (a) from among dealers of the highest credit
standing which satisfy all the criteria that such party applies generally at
the time in deciding whether to offer or to make an extension of credit and (b) to
the extent practicable, from among such dealers having an office in the same city.

 

“Relevant Jurisdiction” means, with respect
to a party, the jurisdictions (a) in which the party is incorporated,
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.

 

16

 

“Specified Indebtedness” means, subject to the
Schedule, any obligation (whether present or future, contingent or otherwise,
as principal or surety or otherwise) in respect of borrowed money.

 

“Specified Transaction” means, subject to the
Schedule, (a) any transaction (including an agreement with respect thereto)
now existing or hereafter entered into between one party to this Agreement (or
any Credit Support Provider of such party or any applicable Specified Entity of
such party) and the other party to this Agreement (or any Credit Support
Provider of such other party or any applicable Specified Entity of such other
party) which is a rate swap transaction, basis swap, forward rate transaction,
commodity swap, commodity option, equity or equity index swap, equity or equity
index option, bond option, interest rate option, foreign exchange transaction, cap
transaction, floor transaction, collar transaction, currency swap transaction,
cross-currency rate swap transaction, currency option or any other similar
transaction (including any option with respect to any of these transactions), (b) any
combination of these transactions and (c) any other transaction identified
as a Specified Transaction in this Agreement or the relevant confirmation.

 

“Stamp Tax” means any stamp,
registration, documentation or similar tax.

 

“Tax” means any present or future tax,
levy, impost, duty, charge, assessment or fee of any nature (including interest,
penalties and additions thereto) that is imposed by any government or other
taxing authority in respect of any payment under this Agreement other than a
stamp, registration, documentation or similar tax.

 

“Tax Event” has the meaning
specified in Section 5(b).

 

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

 

“Terminated Transactions” means with respect to
any Early Termination Date (a) if resulting from a Termination Event, all
Affected Transactions and (b) if resulting from an Event of Default, all
Transactions (in either case) in effect immediately before the effectiveness of
the notice designating that Early Termination Date (or, if “Automatic Early
Termination” applies, immediately before that Early Termination Date).

 

“Termination Currency” has the meaning
specified in the Schedule.

 

“Termination Currency Equivalent” means, in respect of
any amount denominated in the Termination Currency, such Termination Currency
amount and, in respect of any amount denominated in a currency other than the
Termination Currency (the “Other Currency”), the amount in the Termination
Currency determined by the party making the relevant determination as being
required to purchase such amount of such Other Currency as at the relevant
Early Termination Date, or, if the relevant Market Quotation or Loss (as the
case may be), is determined as of a later date, that later date, with the
Termination Currency at the rate equal to the spot exchange rate of the foreign
exchange agent (selected as provided below) for the purchase of such Other
Currency with the Termination Currency at or about 11:00 a.m. (in the city
in which such foreign exchange agent is located) on such date as would be
customary for the determination of such a rate for the purchase of such Other
Currency for value on the relevant Early Termination Date or that later date.
The foreign exchange agent will, if only one party is obliged to make a
determination under Section 6(e), be selected in good faith by that party
and otherwise will be agreed by the parties.

 

“Termination Event” means an Illegality,
a Tax Event or a Tax Event Upon Merger or, if specified to be applicable, a
Credit Event Upon Merger or an Additional Termination Event.

 

“Termination Rate” means a rate per
annum equal to the arithmetic mean of the cost (without proof or  evidence of any actual cost) to each party (as
certified by such party) if it were to fund or of funding such amounts.

 

“Unpaid Amounts” owing to any party
means, with respect to an Early Termination Date, the aggregate of (a) in
respect of all Terminated Transactions, the amounts that became payable (or
that would have become payable but for Section 2(a)(iii)) to such party
under Section 2(a)(i) on or prior to such Early Termination Date and
which remain unpaid as at such Early Termination Date and (b) in respect of
each Terminated Transaction, for each obligation under Section 2(a)(i) which
was (or would have been but for Section 2(a)(iii)) required to be settled by
delivery to such party on or prior to such Early Termination Date and which has
not been so settled as at such Early Termination Date, an amount equal to the
fair market 

 

17

 

value of that which was (or would have been) required
to be delivered as of the originally scheduled date for delivery, in each case
together with (to the extent permitted under applicable law) interest, in the
currency, of such amounts, from (and including) the date such amounts or
obligations were or would have been required to have been paid or performed to
(but excluding) such Early Termination Date, at the Applicable Rate. Such amounts
of interest will be calculated on the basis of daily compounding and the actual
number of days elapsed. The fair market value of any obligation referred to in
clause (b) above shall be reasonably determined by the party obliged to
make the determination under Section 6(e) or, if each party is so
obliged, it shall be the average of the Termination Currency Equivalents of the
fair market values reasonably determined by both parties.

 

IN WITNESS WHEREOF the parties have executed this
document on the respective dates specified below with effect from the date
specified on the first page of this document.

 

	
  DEXIA
  S.A.

  	
   

  	
  FSA ASSET MANAGEMENT LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
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  DEXIA CRÉDIT LOCAL SA

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
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Guaranteed Put ISDA Master Agreement

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00160-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00160-of-00352.parquet"}]]