HomeMy WebLinkAboutOrdinance 12598ORDINANCE NO I~~9~
FOURTH SUPPLEMENTAL ORDINANCE AUTHORIZING THE
EXECUTION AND DELIVERY OF INTEREST RATE SWAP AGREEMENTS
IN CONNECTION WITH THE CITY OF FORT WORTH, TEXAS
WATER AND SEWER SYSTEM FINANCE PROGRAM, DECLARING THE CITY'S
PAYMENT OBLIGATIONS UNDER SAID AGREEMENTS AS "PARITY OBLIGATIONS"
UNDER THE MASTER ORDINANCE ESTABLISHING THE CITY OF FORT WORTH, TEXAS
WATER AND SEWER SYSTEM REVENUE FINANCING SYSTEM, AND
ORDAINING OTHER MATTERS IN RESPECT THERETO
THE STATE OF TEXAS
COUNTIES OF TARRANT AND DENTON
CITY OF FORT WORTH
WHEREAS, the City of Fort Worth, Texas (the "City" or the "Issuer"), a "home-rule" city
operating under ahome-rule charter adopted pursuant to Section 5 of Article XI of the Texas
Constitution, with a population according to the latest federal decennial census of in excess of 90,000,
has established and currently owns and operates a combined waterworks and samtary sewer system
(the "System"), and
WHEREAS, the City heretofore has established the City of Fort Worth, Texas Water and
Sewer System Revenue Finance Program for the purpose of providing a financing structure for
revenue supported indebtedness of the System, and
WHEREAS, said Program was established pursuant to the terms of a "Master Ordinance
Establishing the City of Fort Worth, Texas Water and Sewer System Revenue Financing Program"
(the "Master Ordinance"), and
WHEREAS, unless otherwise defined herein, terms used herein shall have the meaning given
in the Master Ordinance; and
WHEREAS, the Master Ordinance authorizes revenue supported indebtedness to be issued,
incurred or assumed pursuant to the teens of supplemental ordinances (any such ordinance being a
"Supplement"), and
WHEREAS, pursuant to the terms of the Master Ordinance, the City has adopted three
Supplements (designated as the "First Supplement", "Second Supplement" and "Third Supplement",
respectively, and the "Prior Supplements", collectively) pursuant to which the City of Fort Worth,
Texas Water and Sewer System Revenue Refunding Bonds, Series 1991A and Serves 1991B, the City
of Fort Worth, Texas Water and Sewer System Revenue Refiinding Bonds, Serves 1993 and the City
of Fort Worth, Texas Water and Sewer System Revenue Refunding and Improvement Bonds, Serves
1996 (the "Previously Issued Panty Obligations") were issued, and which were secured by the pledge
of a first lien on and pledge of the Pledged Revenues of the System, and
WHEREAS, Article 717q, Texas Revised Civil Statutes ("Article 717q") authorizes the City
Council of the City to execute and deliver "credit agr'eeinei~ts at or after the issuance of obligations
or m conjunction with the payment, sale, resale, or exchange of obligations to enhance the security
for or provide for the payment, redemption, or remarketing of the obligations and interest on the
obligations", and
WHEREAS, the Master Ordinance permits the City to enter into "Credit Agreements", as
defined in the Master Ordinance, as a Panty Obligation, and
WHEREAS, payments to be made under a Credit Agreement may be treated as Panty
Obligations if the City Council makes a finding that, based upon the findings contained m a certificate
executed and delivered by a Designated Financial Officer, the City will have sufficient funds to meet
the financial obligations of the System, including sufficient Pledged Revenues to satisfy the Annual
Debt Service Requirements of the System and the financial obligations of the City relating to the
System after giving effect to the treatment of the Credit Agreement as a Panty Obligation, and
WHEREAS, the City's financial advisor has recommended to the Crty Council that in
connecrion vv~th the econorruc and efficient operation of the System, and to enhance the security for
or provide for the payment of the principal of and interest on the Previously Issued Panty Obligations,
rt is advisable that the City enter into an "ISDA Master Agreement", dated as of July 23, 1996 (the
"Lehman Agreement"), with Lehman Brothers Special Financing Inc. ("Lehman") and an "ISDA
Master Agreement", dated as of July 23, 1996 (as may be novated by the hereinafter defined
Termination and Replacement Agreement, the "GBDP Agreement"), vv~th GBDP, L.P (together with
Lehman and, upon the effectiveness of the Termmnation and Replacement Agreement, General Re
Financial Products Corporation, the "Providers"), and
WHEREAS, the Lehman Agreement and the GBDP Agreement are collectively referred to
herein as the "Interest Rate Swap Agreements", and
WHEREAS, each of the Interest Rate Swap Agreements constitutes a "Credit Agreement",
as said term is used in the Master Ordinance and a "credit agreement" as said term is used in Article
717q, and
WHEREAS, the City Council has adopted this Fourth Supplement to the Master Ordinance
in accordance vv~th the provisions of the Master Ordinance, and the payment obligations incurred by
the City under the terms of the Interest Rate Swap Agreements hereinafter authorized shall hereafter
constitute Panty Obligations under the Master Ordinance, and
WHEREAS, the Interest Rate Swap Agreements hereinafter authorized are to be executed,
issued and delivered pursuant to Article 717q, for the purposes set forth above.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCII, OF THE CITY OF
FORT WORTH, TEXAS
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SECTION• 1 DEFINITIONS In addition to the definitions set forth in the preamble of this
Fourth Supplement, the teens used iri this Fourth Supplement and not otherwise defined shall have
the meanings given in the Master Ordinance, the Prior Supplements or in Exhibit A to this Fourth
Supplement. The term "Gross Revenues", as defined in the Master Ordinance, includes all revenues,
income, and receipts denved or received 'by the City from the operation and ownership of the System.
The City Council hereby declares that the payments received by the City from the Providers under
the Interest Rate Swap Agreements shall constitute Gross Revenues for all purposes of the Master
Ordinance, including, without limitation, Section 2 thereof. In addition to the foregoing, by separate
action of the City Council, certain impact fees charged by the City under authority of Chapter 395,
Texas Local Government Code, specifically Section 395 012, shall constitute Gross Revenues for all
purposes of the Master Ordinance.
Section 2 INTEREST RATE SWAP AGREEMENTS AUTHORIZED (a) That the
execution of the Lehman Agreement, including the "Schedule to the Master Agreement", the
"Confirmation" in the form attached thereto as Exhibit A to said Schedule, and the Master Pledge
Agreement, dated as of July 23, 1996, between Lehman and the City, in the form attached thereto
as Exhibit G to said Schedule, by the City Manager, the City Attorney and the City Secretary, in
substantially the forms attached to this Fourth Supplement as Exhibit B, is hereby approved, and that
the City Secretary is hereby authonzed, on behalf of the City, to affix or imprint the seal of the City
to the Lehman Agreement, said Schedule and said Confirmation. The City Manager, any Assistant
City Manager and the Director of Fiscal Services each are authorized to execute on behalf of the City
all other exhibits attached to the Lehman Agreement. The Notional Amounts, the Fixed Amounts
and the Floating Amounts described in said Confirmation described above are hereby approved.
(b) That the execution of the GBDP Agreement, including the "Schedule to the Master
Agreement" and the "Confirmation" in the form attached thereto as Exhibit A to said Schedule, and
the "Termination and Replacement Agreement" by and between the City and General Re Financial
Products Corporation, by the City Manager, the City Attorney and the City Secretary, in substantially
the forms attached to this Fourth Supplement as Exhibit C, is hereby approved, and that the City
Secretary is hereby authorized, on behalf of the City, to affix or imprint the seal of the City to the
GBDP Agreement, said Schedule, said Confirmation and said Termination and Replacement
Agreement. The City Manager, any Assistant City Manager and the Director of Fiscal Services each
are authorized to execute on behalf of the City all other exhibits attached to the GBDP Agreement.
The Notional Amounts, the Fixed Amounts and the Floating Amounts described in said Confirmation
described above are hereby approved.
Section 3 ESTABLISHMENT OF FINANCING PROGRAM AND ISSUANCE OF
.PARITY OBLIGATIONS That by adoption of the Master Ordinance the City has established the
City of Fort Worth, Texas Water and Sewer System Revenue Financing Program for the purpose of
providing a financing structure for revenue supported indebtedness of the System. The Master
Ordinance is intended to establish a master plan under which revenue supported debt of the System
can be incurred. This Fourth Supplement provides for the authorization, execution, and delivery of
the Interest Rate Swap Agreements, the payments by the City under which shall constitute Panty
Obligations. The Master Ordinance is incorporated herein by reference and as such made a part
hereof for all purposes, except to the extent modified and supplemented hereby, and the Interest Rate
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Swap Agreements are hereby declared to be Panty Obligations under the Master Ordinance. The City
Council has received a certificate executed and delivered by a Designated Financial Officer to the
effect that the City will have sufficient funds to meet the financial obligations of the System, including
sufficient Pledged Revenues to satisfy the Annual Debt Sernce Requirements of the System and the
financial obligations of the City relating to the System after giving effect to the treatment of the
Interest Rate Swap Agreements as Panty Obligations. The City Council hereby finds and determines
that (i) the Interest Rate Swap Agreements shall be treated as a Panty Obligation under the Master
Ordinance, (ii) the City will have sufficient funds to meet the financial obligations of the System,
including sufficient Pledged Revenues to satisfy the Annual Debt Sernce Requirements of the System
and to meet all financial obligations of the City relating to the System and (iii) that the execution and
delivery of the Interest Rate Swap Agreements shall enhance the secunty for or provide for the
payment of the principal of and interest on the Previously Issued Panty Obligations by providing for
the receipt of fixed rate payments which currently are estimated to exceed the variable rate payments
to be made by the City under the Interest Rate Swap Agreements, on an annual basis, of
approximately $375,000 per year for the teen of the Interest Rate Swap Agreements.
Section 4 PLEDGE That the payments to be made by the City under the Interest Rate
Swap Agreements are and shall be secured by and payable from a first lien on and pledge of the
- Pledged Revenues; and the Pledged Revenues are further pledged to the establishment and
maintenance of the Debt Service Fund and to the Reserve Fund to the extent hereinafter provided.
The payments under the Interest Rate Swap Agreements are and will be secured by and payable only
from the Pledged Revenues, and are not secured by or payable from a mortgage or deed of trust on
any properties, whether real, personal, or mixed, constituting the System.
Section 5 DEBT SERVICE FUND ACCOUNTS That m connection with the payment
obligations to the Providers under the terms of the respective Interest Rate Swap Agreements, the
City hereby establishes within the Debt Service Fund two separate accounts, designated the "Lehman
Interest Rate Swap Agreement Payment Obligation Account" and the "GBDP Interest Rate Swap
Agreement Payment Obligation Account" The City shall deposit within each account on or before
the dates specified in the Lehman Agreement and the GBDP Agreement, respectively, the amounts
specified in the Lehman Agreement and the GBDP Agreement, respectively, necessary to satisfy the
payment obligations of the City under the Interest Rate Swap Agreements.
Section 6 RESERVE FUND That deposits to the credit of the Reserve Fund shall be made
in the manner described in Section 8(b) of this Fourth Supplement.
Section 7 INVESTMENTS That money in the Reserve Fund created under this Fourth
Supplement shall not be invested in securities with an average aggregate weighted matunty of greater
than seven years. The value of the Reserve Fund, in addition to the annual determination described
in the Master Ordinance, shall be established at the time or times withdrawals are made therefrom.
Investments shall be sold promptly when necessary to prevent any default in connection with the
Parity Obligations, including the Interest Rate Swap Agreements. Earnings denved from the
investment of moneys on deposit in the various Funds and Accounts shall be credited to the Fund or
Account from which moneys used to acquire such investment shall have come.
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Section 8 FLOW OF FUNDS That all monies m the System Fund not required for pa}nng
Operating Expenses during each month shall be applied 6y the Crty, on or before the 10th day of the
follovv~ng month, commencing during the months and in the order of priority with respect to the
Funds and Accounts that such applications are hereinafter set forth m this Section.
(a) Debt Service Fund - To the credit of the Debt Sernce Fund, such amounts, deposited
on a monthly basis, commencing during the month m which the Interest Rate Swap Agreements are
delivered, or the month thereafter if delivery is made after the 10th day thereof, as will be sufficient,
together with other amounts, if any, m the Accounts wrtlun the Debt Service Fund described m
Section 5 of this Fourth Supplement, and available for such purpose, to pay the net amounts, if any,
due to the Providers that have accrued since the immediately preceding payment date. In satisfying
compliance vv~th this provision, the City shall take into account current levels of funds then on deposit
in said Accounts in making the monthly calculation to determine the amount of moneys necessary to
sufficiently fund said Accounts.
(b) Reserve Fund - To the credit of the Reserve Fund, such amounts, deposited in
approxunately equal monthly installments, commencing during the month m which the Interest Rate
Swap Agreements are delivered, or the month thereafter if delivery is made after the 10th day thereof,
equal to not less than 1/24 of the Required Reserve Amount, until such tune as such amounts together
with other amounts, if any, in the Reserve Fund, equal the Required Reserve Amount. When and so
long as the Reserve Fund Obligations in the Reserve Fund are not less than the Required Reserve
Amount, no deposits need be made to the credit of the Reserve Fund. When and if the Reserve Fund
at any time contains less than the Required Reserve Amount due to any cause or condition then,
subject and subordinate to making the required deposits to the credit of the Debt Service Fund,
commencing with the month during which such deficiency occurs, such deficiency shall be made up
from the next available Pledged Revenues or from any other sources available for such purpose, in
monthly installments of not less than 1/12 of the Required Reserve Amount, in the manner provided
in the Master Ordinance. Reunbursements to the provider, if any, of a Credit Facility shall constitute
the making up of a deficiency to the extent that such reimbursements result in the reinstatement, in
whole or in part, as the case may be, of the amount of the Credit Facility The Reserve Fund shall
be for the benefit of all Panty Obligations, including the Providers.
(c) Annual Debt Service Requirements. For purposes of calculating the Annual Debt Service
Requirements of the System upon the delivery of the Interest Rate Swap Agreements, (i) the
payments to be made by the Crty as a "Floating Rate Payor" (as used in the Interest Rate Swap
Agreements) shall be treated as a variable rate payment, as described in clause (5) of the definition
of Annual Debt Sernce Requirements set forth in the Master Ordinance, and (ii) the payments
received by the City under the terms of the Interest Rate Swap Agreements shall upon receipt be
deposited to the credit of the System Fund as a Gross Revenue of the System. For purposes of this
Fourth Supplement, upon the effective date of the Interest Rate Swap Agreements, the Annual Debt
Service Requirement, in deter-mining the Required Reserve Amount resulting from the obligations of
the City under the Interest Rate Swap Agreements, shall be calculated on the basis that (i) the
payments made by the City under the Interest Rate Swap Agreements shall be based upon a rate of
15% and (ii) the payments received by the City shall be zero
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Section 9 PAYMENTS UNDER THE INTEREST RATE SWAP AGREEMENTS That
on or before the first scheduled payment date, and on or before each scheduled payment date
thereafter while either the Lehman Agreement or the GBDP Agreement remains in effect, the City
shall pay from the moneys on deposit in the Accounts within the Debt Service Fund described in
Section 5 of this Fourth Supplement (and the Reserve Fund, if necessary) the amounts payable under
the terms of the Lehman Agreement and the GBDP Agreement, respectively, to the respective
Providers as shall become due on such scheduled payment dates.
Section 10 FOURTH SUPPLEMENT TO CONSTITUTE A CONTRACT, EQUAL
SECURITY This Fourth Supplement shall be deemed to be and shall constitute a contract between
the City and the Providers and the pledge made in this Fourth Supplement by the City and the
covenants and agreements set forth in this Fourth Supplement to be performed by the City shall be
for the equal and proportionate benefit, security, and protection of each Provider, without preference,
prionty, or distinction as to secunty or otherwise of the Interest Rate Swap Agreements authonzed
hereunder over any of the others by reason of tune of issuance, sale, or matunty thereof or otherwise
for any cause whatsoever, except as expressly provided in or permitted by this Fourth Supplement.
Section 11 SEVERABILITY OF INVALID PROVISIONS That if any one or more of the
covenants, agreements, or provisions hereui contained shall be held contrary to any express provisions
of law or contrary to the policy of express law, though not expressly prohibited, or against public
policy, or shall for any reason whatsoever be held invalid, then such covenants, agreements, or
provisions shall be null and void and shall be deemed separable from the remaimng covenants,
agreements, or provisions and shall in no way affect the validity of any of the other provisions hereof
or of the Interest Rate Swap Agreements authonzed hereunder
Section 12. PAYMENT AND PERFORMANCE ON BUSINESS DAYS That, except as
provided to the contrary in the Interest Rate Swap Agreements, whenever under the terms of this
Fourth Supplement, the performance date of any provision hereof or thereof, including the scheduled
payments to the Providers under the terms of the Interest Rate Swap Agreements, shall occur on a
day other than a Business Day, then the performance thereof, including such scheduled payments,
need not be made on such day but may be performed or paid, as the case may be, on the next
succeeding Business Day with the same force and effect as if made on the date of performance or
payment.
Section 13 LIlVIITATION OF BENEFITS WITH RESPECT TO THE FOURTH
SUPPLEMENT That with the exception of the nghts or benefits herein expressly conferred, nothing
expressed or contained herein or implied from the provisions of this Fourth Supplement is intended
or should be construed to confer upon or give to any person other than the City and the Providers,
any legal or equitable right, remedy, or claim under or by reason of or in respect to this Fourth
Supplement or any covenant, condition, stipulation, promise, agreement, or provision herein
contained. This Fourth Supplement and all of the covenants, conditions, stipulations, promises,
agreements, and provisions hereof are intended to be and shall be for and inure to the sole and
exclusive benefit of the City and the Providers as herein and therein provided.
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Section 14 FURTHER PROCEDURES That the Mayor, the City Secretary or Assistant
City Secretary, any Designated Financial Officer, and all other officers, employees, and agents of the
City, and each of them, shall be and they are hereby expressly authorized, empowered, and directed
from time to time and at any time to do and perform all such acts and things and to execute,
acknowledge, and deliver in the name and under the seal and on behalf of the Issuer all such
instruments, whether or not herein mentioned, as maybe necessary or desirable in order to carry out
the terms and provisions of this Fourth Supplement and the Interest Rate Swap Agreements.
Section 15 APPROVAL OF INTEREST RATE SWAP AGREEMENTS That the City
Manager of the City is hereby authorized to have control of the Interest Rate Swap Agreements and
all necessary records and proceedings pertauung thereto pending then delivery and their investigation,
examination and approval by the Attorney General of the State of Texas.
Section 16 PREAMBLE. That the preamble to this Fourth Supplement is hereby
incorporated by reference, and is to be considered a part of the operative text of this Fourth
Supplement.
Section 17 IlVIlViEDIATE EFFECT That this Fourth Supplement shall be effective
unmediately from and after its passage in accordance with the provisions of Section 2 of Chapter 25
of the Charter of the City, and it is accordingly so ordained.
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SIGNED AND SEALED THIS 23RD DAY OF JULY, 1996
C~~ ~-~
Mayor,
City of Fort Worth, Texas
~~~~
Crty Secretary
(SEAL)
APPROVED AS TO FO AND LEGALITY
City Attorney
.sew= ~ ~:._
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EXHIBIT A
That, as used- in this Fourth Supplement, the following teens shall have the meamngs set forth
below, unless the text hereof specifically indicates otherwise
"Business Day" shall have the meaning given said term in the Interest Rate Swap Agreements.
"First Supplement" means the ordinance authonzing the issuance of the Senes 1991A Bonds
and the Serves 1991B Bonds.
"GBDP Agreement" means the "ISDA Master Agreement", dated as of July 23, 1996,
between the City of Fort Worth and GBDP, L.P, as may be novated by the Tenrunation and
Replacement Agreement.
"Interest Rate Swap Agreements" means, collectively, the GBDP Agreement and the Lehman
Agreement.
"Lehman Agreement" means the "ISDA Master Agreement", dated as of .July 23, 1996,
between the City of Fort Worth and Lehman Brothers Special Financing Inc
"Master Ordinance" means the "Master Ordinance establishing the City of Fort Worth Texas
Water and Sewer System Revenue Financing Program", passed by the City on December 10, 1991
"Previously Issued Panty Obligations" shall be the Serves 1991A Bonds, the Serves 1991B
Bonds, the Senes 1993 Bonds and the Serves 1996 Bonds.
"Provider" means, with respect to the GBDP Agreement, GBDP, L.P and any successor
thereto including, without lirrutation, General Re Financial Products Corporation, under the terms
of the GBDP Agreement, and, with respect to the Lehman Agreement, Lehman Brothers Special
Financing Inc. and any successor thereto under the terms of the Lehman Agreement, and "Providers"
means, collectively, GBDP, L.P and Lehman Brothers Special Financing Inc. (and their respective
successors, if any, including, without hinutation, General Re Financial Products Corporation)
"Second Supplement" shall mean the ordinance authonzing the issuance of the Serves 1993
Bonds.
"Senes 1991A Bonds" shall mean the City of Fort Worth, Texas Water and Sewer System
Revenue Refunding Bonds, Serves 1991A, authorized by the First Supplement.
"Senes 1991B Bonds" shall mean the Crty of Fort Worth, Texas Water and Sewer System
Revenue Refunding Bonds, Serves 1991B, authonzed by the First Supplement.
"Senes 1993 Bonds" shall mean the City of Fort Worth, Texas Water and Sewer System
Revenue Refunding Bonds, Senes 1993, authonzed by the Second Supplement.
A-1
~N .E {
au
"Series 1996 Bonds" shall mean the City of Fort Worth, Texas Water and Sewer System
Revenue Refunding and Improvement Bonds, Senes 1996; authorized by the Third Supplement.
"Terriunation and Replacement Agreement" shall mean the Tenrunation and Replacement
Agreement, dated as of July 23, 1996 between the City and General Re Financial Products
Corporation.
"Third Supplement" shall mean the ordinance authonzmg the issuance of the Serves 1996
Bonds.
A-2
EXHIBIT B
FORM OF LEHMAN AGREEMENT
B-1
EXHIBIT B
FORM OF LEHMAN AGREEMENT
B-1
Jul 19.1996 8 40PM R&W FAX DEPT 8 No 6267 P 5/25
EXECUTION COPY
(lC.opl Ctirreocy~Single Jurisdiction)
ISDA.
International Swap Demers Association, Inc.
MAS'H'ER 1~.GREEMEN'r
dated as of July " 23, 1996
Lehman Brothers Special Financing Inc. and City of Fort Worth, Texas have catered and/or antacipate
entering into one or more transactions (each a 'Transaction') that are or will be governed by this Master Agreement
(the 'Master Agrretnant'), which includes the schedule (the "Schedule"), and the documents and other confirmrng
evidence (each a "Confirmation") exchanged between the patties confirming those Transactions.
Accordingly, the parties agree as follows.-
1. I(ntetpretstion
(a) D~efinrt+orts~ The terms defined to Section 12 and in the Schedule will have the meanings therein specified
for the purpose of this Master Agreement.
(b) Ittewnsisttttcy In the event of any inconsistency between the provisions of the Schedule and the other
provisions of this Master Agreement, the Sehcdule 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 t..onfirooations form a single agreetnettt between the parties (collectively referred to as this 'Agr~cetaeat"),
and the patties would not otherwise enter into any Transactions __
x. Obligations
(a) Gcnarrrl Cotulrtioru
(i) Each parry will make each payment yr delivery specified in each Confirmation to be made by
it, subject to the other ptvisions of this Agroctacnt.
(ii) Payments under this Agreement will be made on the due date for value oa that date in the
place of the account specified in the relevant Confirmation or othetwtse ptusuant w this Agreement, in
freely transferable funds and in the manner customary for paytnenu in the required currency Where
- - settlement is by delivery (that is, other than by payment), such delivery will be made for receipt an the
due date in the meaner txrstotnary for the relevant obligation unless otherwise specified is the relevant
Confirmation or elsewhere in this Agreement.
Copyri`tft ° 1992 try Incernarional Swap Dalers wuncitina, lac.
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(iii) Each obligation of each party under Section 2(a)(i) is subject to (1) the condition precedent
that no Event of Default or 1?oteritial Event of Default with respect to the other party has occtrred and
is continuing, (2) the condition precedent that no Early Termination Date in respect of the relevant
Transaction has occurred or been effectively designated and (3) each other applicable condition precedent
specified in this Agreement.
(b) Change of Account Either party may change its account for receiving a payment or delivery by giving
notice to the other party at least five Local Business Days prior to the scheduled date for the payment or delivery
to which such change applies unless such other party gives timely notice of a reasonable objection to such change.
(c) Netting If on any date amounts would otherwise be payable:-
(i) in the same currency; and
(ii) in respect of the same Transaction,
by each party to the other, then, on such date, each party's obligation to make payment of any such amount will
be automatically satisfied and dischazged 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 lazger aggregate amount would have been payable to pay to the other party
the excess of the lazger 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 subpazagraph (ii) above will not apply to the Transactions identified as being subject
to the election, together with the starting date (in which case subpazagraph (ii) above will not, or will cease to, apply
to such Transactions from such date) This election may be made sepazately for different groups of Transactions
and will apply sepazately to each pairing of branches or offices through which the parties make and receive
payments or deliveries.
(d) Default Interest; Other Amounts. Prior to the occurrence or effective designation of an Eazly
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 Eazly 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) that.-
(a) Basic Representations.
(i) Status It is duly organized and validly existing under the laws of the jurisdiction of its
organization or incorporation and, if relevant under such laws, in good standing;
(ii) Powers It has the power to execute this Agreement and any other documentation relating to
this Agreement to which it is a party, to deliver this Agreement and any other documentation relating to
Copyright ° 1992 by International Swap Dealers Association, Inc.
NA 143787.6 2
this Agreement that it is required by this Agreement to deliver and to perform its obligations under this
Agreement and any obligations if has under any Credit Supportt Document to which it is a party and has
taken all necessary action to authorize such execution, delivery and performance;
(iii) No Violation or Conflict. Such execution, delivery and performance do not violate or conflict
with any law applicable to it, any provision of its constitutional documents, any order or judgment of any
court or other agency of government applicable to it or any of its assets or any contractual restriction
binding on or affecting it or any of its assets,
(iv) Consents All governmental and other consents that aze 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 aze in full force and effect and all conditions of any such consents have been complied with,
and
(v) Obligations Binding Its obligations under this Agreement and any Credit Support Document
to which it is a party constitute its legal, valid and binding obligations, enforceable in accordance with
their respective terms (subject to applicable bankruptcy, reorganization, insolvency, moratorium or similaz
laws affecting creditors' rights generally and subject, as to enforceability, to equitable principles of
general application (regazdless of whether enforcement is sought in a proceeding in equity or at law))
(b) Absence of Certain Events No Event of Default or Potential Event of Default or, to its knowledge,
Termination Event with respect to it has occurred and is continuing and no such event or circumstance would occur
as a result of its entering into or performing its obligations under this Agreement or any Credit Support Document
to which it is a party
(c) Absence of Litigation There is not pending or, to its knowledge, threatened against it or any of its
Affiliates any action, suit or proceeding at law or inequity or before any court, tribunal, governmental body, agency
or official or any azbitrator 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.
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 any forms, documents or certificates
specified in the Schedule or any Confirmation by the date specified in the Schedule or such Confirmation or, if none
is specified, as soon as reasonably practicable.
(b) Maintain Authorizations It will use all reasonable efforts to maintain in full force and effect all consents
of any governmental or other authority that aze 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
Copyright ° 1992 by International Swap Dealers Association, Inc.
NA 143787.6 3
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(d) 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(d) or to give notice of a Termination Event or any agreement or obligationunder Section 4(a))
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 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 eazly 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 eazly termination of, a
Specified Transaction (or such default continues for at least three Local Business Days if there is no
applicable notice requirement or grace period) or (3) disaffirms, disclaims, repudiates or rejects, in whole
or in part, a Specified Transaction (or such action is taken by any person or entity appointed or
empowered to operate it or act on its behalf),
(vi) Cross Default If "Cross Default" is specified in the Schedule as applying to the party, the
occurrence or existence of (1) a default, event of default or other similar condition or event (however
described) in respect of such party, any Credit Support Provider of such party or any applicable Specified
Entity of such party under one or more agreements or instruments relating to Specified Indebtedness of
any of them (individually or collectively) in an aggregate amount of not less than the applicable Threshold
Amount (as specified in the Schedule) which has resulted in such Specified Indebtedness becoming, or
Copyright ° 1992 by International Swap Dealers Association, Inc.
NA143787.6 Gl
becoming capable at such time of being declazed, 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 similaz 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; (S) 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 similaz
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, dischazged,
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 specifed 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, and, if specified to be applicable, a Credit Event Upon Merger if the
event is specified pursuant to (ii) below or an Additional Termination Event if the event is specified pursuant to (iii)
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
Copyright ° 1992 by International Swap Dealers Association, Inc.
NA t4378Z6 5
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) 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
(iii) 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.
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 eazlier than the day such notice is effective as an Early Termination Date in respect of all outstanding
Transactions If, however, "Automatic Eazly Termination" is specified in the Schedule as applying to a party, then
an Eazly 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
awaze 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) Two Affected Parties If an Illegality under Section 5(b)(i)(1) occurs and there aze 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.
Copyright ° 1992 by International Swap Dealers Association, Inc.
NA 143787.6 6
(iii) Right to Terminate. If•-
(1) an agreement under Section 6(b)(ii) 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 other than that referred to in Section 6(b)(ii), a Credit Event Upon
Merger or an Additional Termination Event occurs,
either party in the case of an Illegality, any Affected Party in the case of an Additional Termination Event
if there is more than one Affected Party, or the party which is not the Affected Party in the case of a
Credit Event Upon Merger or an Additional Termination Event if there is only one Affected Party may,
by not more than 20 days notice to the other party and provided that the relevant Termination Event is
then continuing, designate a day not eazlier than the day such notice is effective as an Eazly Termination
Date in respect of all Affected Transactions
(c) Effect of Designation
(i) If notice designating an Eazly Termination Date is given under Section 6(a) or (b), the Eazly
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 Eazly Termination Date, no further
payments or deliveries under Section 2(a)(i) or 2(d) 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 Mazket 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 Eazly 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 Eazly 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), 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 "Mazket 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 "Mazket Quotation" or the "Second Method,"
as the case may be, shall apply The amount, if any, payable in respect of an Eazly Termination Date and
determined pursuant to this Section will be subject to any Set-off
Copyright ° 1992 by International Swap Dealers Association, Inc.
NA 143787.6 ~]
(i) Events of Default. If the Eazly Termination Date results from an Event of Default:-
(1) First Method and Market Quotation. If the First Method and Mazket 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 Unpaid Amounts owing to the Non-
defaulting Party over (B) 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 Mazket Quotation
apply, an amount will be payable equal to (A) the sum of the Settlement Amount (determined
by the Non-defaulting Party) in respect of the Terminated Transactions and the Unpaid
Amounts owing to the Non-defaulting Party less (B) 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 Parry If there is one Affected Party, the amount payable will be
determined in accordance with Section 6(e)(i)(3), if Mazket 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 aze being terminated, Loss shall be calculated in respect of all Terminated
Transactions.
(2) Two Affected Parties If there are two Affected Fazties.-
(A) if Mazket 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 Unpaid Amounts owing
to X less (II) 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 aze 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
Copyright ° 1992 by International Swap Dealers Association, Inc.
NA143787.6 g
(iii) Adjustment for Bankruptcy. In circumstances where an Early Termination Date occurs
because "Automatic Eazly Termination" applies in respect of a party, the amount determined under this
Section 6(e) will be subject to such adjustments as aze 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 Eazly Termination Date to the date for payment determined
under Section 6(d)(ii)
(iv) Pre-Estimate. The parties agree that if Mazket Quotation applies an amount recoverable under
this Section 6(e) is a reasonable pre-estimate of loss and not a penalty Such amount is payable for the
loss of bargain and the loss of protection against future risks and except as otherwise provided in this
Agreement neither party will be entitled to recover any additional damages as a consequence of such
losses
7 Transfer
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 of 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. 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
Copyright m 1992 by International Swap Dealers Association, Inc.
NA143787.6 9
supplement to this Agreement. The parties will specify therein or through another effective means that
any such counterpaR, 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 aze not to
affect the construction of or to be taken into consideration in interpreting this Agreement.
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, .incurred by such other party by reason of the enforcement and protection
of its rights under this Agreement or any Credit Support Document to which the Defaulting Party is a party or by
reason of the eazly termination of any Transaction, including, but not limited to, costs of collection.
10. 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 aze to be given to it.
11 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 -
Copyright ° 1992 by International Swap Dealers Association, Inc.
NA 143787.6 1 Q
(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) 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.
12. 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, 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 aNon-defaulting Party, the Non-default Rate; and
(d) in all other cases, the Termination Rate.
Copyright ° 1992 by International Swap Dealers Association, Inc.
NA 143787.6 11
"consent" includes a consent, approval, action, authorization, exemption, notice, filing, registration or exchange
control consent.
"Credit Event Upon Merger" has the meaning specified in Section 5(b)
"Credit Support Document" means any agreement or instrument that is specified as such in this Agreement.
"Credit Support Provider" has the meaning specified in the Schedule.
"Default Rate" means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the
relevant payee (as certified by it) if it were to fund or of funding the relevant amount plus 1 % per annum.
"Defaulting Party" has the meaning specified in Section 6(a)
"Early Termination Date" means the date determined in accordance with Section 6(a) or 6(b)(iii)
"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)
"taw" includes any treaty, law, rule or regulation and "lawful" and "unlawful" will be construed accordingly
"Local Business Day" means, subject to the Schedule, a day on which commercial banks aze 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, (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, an amount that pazty 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 bazgain, 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 Eazly Termination Date and not made, except, so as to
avoid duplication, if Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does not include a party's legal fees
and out-of-pocket expenses referred to under Section 9 A party will determine its Loss as of the relevant Eazly
Termination Date, or, if that is not reasonably practicable, as of the eazliest 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 mazkets
"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 Mazket-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 Mazket-
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)
Copyright ®1992 by International Swap Dealers Association, Inc.
NA143787.6 12
in respect of such Terminated Transaction or group of Terminated Transactions that would, but for the occurrence
of the relevant Early Termination Date, Have been required after that date. For this purpose, Unpaid Amounts in
respect of the Terminated Transaction or group o£ 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 Eazly Termination Date is to be included.
The Replacement Transaction would be subject to such documentation as such party and the Reference Mazket-
maker may, in good faith, agree. The party making the determination (or its agent) will request each Reference
Mazket-maker to provide its quotation to the extent reasonably practicable as of the same day and time (without
regazd to different time zones) on or as soon as reasonably practicable after the .relevant Eazly Termination Date.
The day and time as of which those quotations aze 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 aze provided, the Mazket Quotation will be the arithmetic mean of the quotations, without
regazd to the quotations having the highest and lowest values. If exactly three such quotations aze provided, the
Market Quotation will be the quotation remaining after disregazding 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 disregazded. If fewer than three quotations are provided, it will be deemed that the Mazket 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.
"Nondefaulting Party" has the meaning specified in Section 6(a)
"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 mazket selected by the party determining
a Mazket 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
"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 Eazly Termination Date, the sum of•-
(a) the Mazket Quotations (whether positive or negative) for each Terminated Transaction or group
of Terminated Transactions for which a Mazket 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 Mazket Quotation cannot be
determined or would not (in the reasonable belief of the party making the determination) produce a commercially
reasonable result.
"Specified Entity" has the meaning specified in the Schedule
"Specified Indebtedness" means, subject to the Schedule, any obligation (whether present or future, contingent or
otherwise, as principal or surety or otherwise) in respect of borrowed money
Copyright ° 1992 by International Swap Dealers Association, Inc.
NA 143787.6 13
"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, forwazd 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, collaz transaction, currency swap transaction, cross-currency rate swap transaction, currency option or
any other similaz 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.
"Terminated Transactions" means with respect to any Eazly 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 Eazly Termination Date (or, if "Automatic
Early Termination" applies, immediately before that Early Termination Date)
"Termination Event" means an Illegality 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 Eazly 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 Eazly Termination Date and which
remain unpaid as at such Eazly 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 mazket 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 Eazly 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 fair mazket values reasonably determined by both parties.
Copyright ° 1992 by International Swap Dealers Association, Inc.
NA 143787.6 14
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.
LEHMAN BROTHERS SPECIAL
FINANCING INC.
By
Name:
Title:
Date:
CITY OF FORT WORTH, TEXAS
By•
Name:
Title: City Manager
Date:
Attest:
By•
Name.
Title: City Secretary
Date:
Approved as to form and legality
By
Name:
Title: City Attorney
Date:
Copyright ° 1992 by International Swap Dealers Association, Inc.
NA143787.6 15
'" N o, 626'1 P 6125
3u1 ]9.1996 8 40P~ ~&w FAX DEPT 8
SCHEDULE
to the
MASTER AGREEMENT
~ dated as of July " 23, 1996
betwoeu
LEHMAN BRGTHIrRS SPECIAL FINANCING INC. ('Party B").
a corporation organized raider
the laws of
the State of Delaware
•ll ~ N, el 'J
,' ,r.'
~.
CITY OF PORT WORTH. TEXAS ("Party A"),
y a "home-role" city organized and operating under
a home-rule charter and the laws of
the State of Texu
part 1 Termiutation Pcavlsioas.
Ia this Agreencent:--
(a) "Specified ,Entity" means in relation to party A for the purpose af:--
Section 5(a)(v) (Default tinder Specified Transaction), Not applicable.
Section S(a)(vi) (Cross Default), Not applicable.
Section 5(axvii) (13attkruptcy), Not applicable.
Section S(b)(ii) (Credit Event Upon Merger), ° Not applicable. _ ..
and in relation to Party 8 for the purpose of:---
Section S(a)(v) (Default under Specified Ttansacticm). Not applicable.
Section S(a)(vi) (Gross Default}, Not applicable.
Section S(a)(vii) (Batiltruptcy}, Not applicable.
5eaion S(b)(ii) (Credit Event Upon Merger), Not applicable.
(b) "Specified TYwnsaation" will have the meaning specified is Section I2 of this Agreement.
(e) The 'Cross Ikj4stlt" provisions of Suction 5(a}(vi) wilt apply to Pasty A az~ Patty $.
The following provisiots apply--
"Speed lardebtedters" wi11 have the :Weaning spxified in Section 12 of this Agreement in the Case of Parry
B, sad in the cast of Parry A shall ratan arty obligation (whether present or future, contingent or otherwise,
u principal or surety or otherwise) in respect of the Bonds or any other indebtedatas issued by fatty A which
is payable with Pledged Revenues (as defined is the Coveted indenture).
"79urthald A+aount" sra'ans two percent (296) of the 5toekholders' Equity of Lehman Brothers Holdings Inc.
("Holdings"). in the case of Party B and Holdings (or its egttivalesu is any other curreaty), and USD
10,000,00t? in the cane of Party A.
MA1~37ff,7 ~
(d) The "Credit Event Upon Merger" provisions of Section 5(b)(ii) will apply to Party A and to Party B,
provided, however, that actions tal~en by Party A in compliaii~e with Section 4(h) of the Master Ordinance
(as part of the Covered Indenture) shall not be deemed to result in a Credit Event Upon Merger
(e) The "Automatic Early Termination" provisions of Section 6(a) will apply to Party A and will not apply to
Party B.
Failure to Notify of Bankruptcy Event. Upon the occurrence of a Bankruptcy Event (as hereinafter defined)
Party A (the "Defaulting Party") hereby agrees to make restitution to Party B (the "Non-defaulting Parties") from
all losses and costs arising from the failure of the Non-defaulting Parties to lift their hedges in respect of the
Transactions upon the occurrence of such Bankruptcy Event from the occurrence of such Bankruptcy Event until
such time as each of the Non-defaulting Parties learns of such event and is satisfied, in its sole discretion, that
termination resulting from such event is legally valid, provided, that each of the Non-defaulting Parties shall use
its best efforts to mitigate its losses, if any, and shall submit to the Defaulting Party a written statement of its losses
and costs (and the basis for calculating such losses and costs in reasonable detail) which statement shall be, absent
manifest error, presumed correct. "Bankruptcy Event" shall mean for purposes of Section 6(a) of the Agreement
and Item (e) of Part I of the Schedule, an event set forth in Section 5(a)(vii) of the Agreement.
(f) Payments on Early Termination. For the purpose of Section 6(e) of this Agreement, Mazket Quotation and
the First Method will apply
(g) Additional Termination Event will apply The following shall constitute an Additional Termination Event:
Holdings or Party B, (in which case Party B shall be the Affected Party), has one or more
outstanding issues of rated unsecured, unenhanced senior debt and none of such issues has a rating
of at least (i) A3 or higher as determined by Moody's Investors Service, Inc. ("Moody's"), (ii) A-
or higher as determined by Standazd & Poor's Ratings Services. ("S&P") or (iii) A- or higher as
determined by Fitch Investors Service, Inc. ("Fitch") or Party A (in which case Party A shall be the
Affected Party), does not have at least an (i) A3 or higher as determined by Moody's, (ii) A- or
higher as determined by S&P or (iii) A- or higher as determined by Fitch on at least one series of
Pazity Obligations without giving effect to any credit enhancement thereon.
(h) Events of Default.
(i) Bankruptcy Clause (6) of Section 5(a)(vii) of this Agreement is hereby amended to read in its
entirety asfollows -
"(6)(A) 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 or (B) in the case of a Government Entity, any Credit Support Provider of such Government
Entity or any applicable Specified Entity of such Government Entity, (I) there shall be appointed or
designated with respect to it, an entity such as an organization, boazd, commission, authority, agency
or body to monitor, review, oversee, recommend or declaze a financial emergency or similaz state
of financial distress with respect to it or (II) there shall be declazed or introduced or proposed for
consideration by it or by any legislative or regulatory body with competent jurisdiction over it, the
existence of a state of financial emergency or similaz state of financial distress in respect of it,"
(ii) Merger Without Assumptiou. Section 5(a)(viii) of this Agreement is hereby amended to read in its
entirety as follows.-
"(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
(or, in the case of Party A, all or substantially all of the project, program or other enterprise from
which the funds specified in Part 4(c)(iv) hereof are derived in whole or in part) to, another entity
NA143787.6
Jul 19.1996 8 40PM R&W FAX DEPT 8 No 6267 P, 7/25
(or. without limiting the, fongoiag, if such party is a, Goverttmtttt F.ntiry, an entity such as an
organization, board, coa~ssioa, authority, agency, or body succeeds to the priiscipat functions of,
or powers and dupes granted to, such party or any Credit Support Provider of such party) and, u
the ttme of such consolidation, amalgamation, merger, transfer or auccession:-
(I) the resulting, surviving, transferee, or successor 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
(2j the benefits of any Credit Support Document fail to extend (without the consent of the
other party) to the performance by such resulting, surviving, transferee or successor entity
of its obligations under this Agteetaent; or
(3) in the case of Parry A, the sources of payment for the obligations of Party A as set forth
in the Schedule ate no longer available for the satisfaction of such resulting, surviving,
transferee or successor entity's obligations to the other party hereto."
(i) T'errieination Events. Section 5(b)(ii) of this Agreement is hereby amended to read in its entirety as follows_-
"(ii) Credit Everu Upon Mager. [f 'Credit >;vtut Upon Merger" is specified is the Schedule as applying
to the parry, such party ('X"), any Credit Support Provider of X or say applicable Specified Entity of X
consolidates or amaigamazes with, or merges with or into, or transfers all or substautitally all its ascots (or,
in the case of Patty A. all or substantially all of the project, program or other enterprise from which the funds
specified in Part 4(c)(iv) hereof are derived in whole or in part) to, another entity (or, without limiting the
foregoing, if X is a Government Entity, an entity such as an organization, board, ootnntission, authority,
agency or body succeeds to the principal functions of, or powers and duties granted to, X, any Credit Support
Provider of X or any Specified Entity of X) and such action does not constitute an event described in Section
5(a)(viii) but tht creditwonhiness of the resulting, surviving, transferee or successor 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'
!hlive-v of Collarterrrl.
Party B shall execute and deliver the Master Plodtte Atrreerrent in the form ann~ted~eto A4 hibit G. and
shall deliver to Partx A collateral substantially in the manner and in the amount stecified in the Master Pled¢e
Auttxment.
Part 2. Agreement to rieliver Documents.
Por the purpose of Section 4(a) of this Agreement, each party agrees to deliver the following documents, as
applicable:--
Parry tequirod to
deliver document Form/Documeat/Certaficate Date by which to be Delivered Covered by
Section 3ldl
Patty B A guarantee of Holdings in the form of Upon execution of this Yes
Exhibit B to this Schedule. Agreement.
Patty B An opinion of counsel to Party B Promptly after execution of this No
substantially in the form of Exhibit C to Agreement.
this Schedule.
w+irrn.~
Jul 19.1996 8 41PM R&W FAX DEPT 8 No. 6267 P 8/25
Party requited to Form/Documen/Certificate . Date bv. which to be peliveted Covered by
dtliver document Section 3 d
Pazt B A Muster Pleder: A~eennnt in the form of Uaon execution of this Yep
Exhibit Cy to this Schedule. Agzeement.
Party A An opinion of counsel W Party A is the Prior t0 the execution of this No
form of Exhibit D to this Schedule. Agrcetneat and, with respect to
east Transaction, prior to the
executioa of Such Transaction.
Party A A copy of the statutory or regulatory Prior to the excretion of this Yes
authority pursuant to which Patty A is Agreement and, with respect to
authorized to enter into his Agreement and each Transaction, prior, to the
each Transacxion. execution of such Transaction.
Parry A An incumbency certificate with respect to Prior to the execution of this Yes
the signatory of this Agreetttent. Agreement ate, with reapecx to
each Transaction. prior to the
execution of such Ttansaaiou.
Parry A A certified Copy of the resolution or Prior to the exectrtian of this Yes
resolutions (or the equivalent thereof) of Agreement and, with respxt to
the governiag body of Party A, certified by each Transaction, prior to the
an appropriate offrcial of Party A, pursuant execution of such Transaction.
to which Party A is authorized to enter into
this Agreement and each Transaction,
substantially in the form of Exhibit E to
this Schedule.
Parry A A certificate from the Mayor or City Prior to the execution of ibis Yes
Manager of Party A, to the effect thaz any Agreement and, with respect to
requirements of the statutory or regulatory each Transaction, prior to the
authority referred to above have been execution of such Transauion.
satisfied, substantrally in the farm of
Exhibit F to this Schedule. specifically, a
certificate of a Designated Financial Officer
a4 defuted in snd as tt~ttired by the
Covered Indenture.
Party A Audited Amual Financaal Statements or Within 180 days of the errd of Yes
Reports and Unaudited Quarterly Financial each year and within 60 days of
Statetneats or Reports. the end of each quarter
Parry A All documents evidencing the necessary Upon the Effective Date of the Yes
authorizations, determinationv and initial Transaction.
approvals for the offering, sale and
issuance of the Bonds.
Party A Reliance letters on opinions of counsel to Upon the lrffecNve Date of the No
Party A with respe« cv rho validity of initial Ttansacdon.
Covered Indenture.
u.~.rma
:: '.C~:r~:~~T
Jul 19.1996 8 42PM R&W FAX DEPT 8
No. 6267 P 9/25
Party required to Form/DoeumaitlCertificate Date ~ "'which to be Delivered Covered by
deliver document Section 3ld)
Party A An opinion of the Attorney General of the Promptly upon the execution of No
Slate of Texas approving the Master this Agreement and, with respect
Agreement, Schedule to the Master to each Transaction, promptly
Agreement and the initial Transaction upon to the execution of such
entered into bctweetr Party A sad Party B Transaction.
as of the date hereof.
Part 3 Miscellaneous.
(a) Addnssa jor Notices. For the purpose of Section 10(a) to this Agzeemeat:-
Address for notices or oommuoications to Parry B.-
Address: 200 Vesey Street, 7th Floor, New York. New York 10285
Attention: Senior Vice President
Facsimile No. (212) 528.6927
Telephone No. (212) 296-5191
Address for notices or communications to Parry A.-
Address. 1000 Thraclunorton, Fort Worth, Texas 76102
Attention: James Keyes. Director of Fiscal Services
Facsitttile No_. (817) 871-8966
Telephone No. (817) 871-8517
(b) Ca[e~on Agent. The Calculation Agetrt is Party B, unless otherwise specified in a Confirmation in relarion
to the relevant Transacxion.
(c) Credit Support Docantert Details of any Credit Support Doctrntertt:-
In the Case of Parry B, a guarantee of Party B's obligations hereunder in the form annexed hereto as F~thibit
13 and the Master Pled e A reement in the form annexed het+eto as xhibit G.
(d) Credit Support Prortdir Credit Support Provider means is relation to Party B: Holdings
(e) Governing law This Agreement will be governed by and construed in aCCOrdance with t}re laws of the State
of Texas (without reference to choicx of law doctrine).
(f) Netting of Paynsents. Subparagraph (ii) of Section 2(c) of this Agreement will not apply to all Tt'ansactions.
(g) "Ajriliate"will have the meaairrg specified in Section 12 of this Agreement.
NAtl77p.7 5
(a) Addresses for Notices. For the purpose of Section 10(a) to this Agreement:-
Address for notices or communications to Party B -
Address. 200 Vesey Street, 7th Floor, New York, New York 10285
Attention. Senior Vice President
Facsimile No (212) 528-6927
Telephone No (212) 298-5191
Address for notices or communications to Party A.-
Address. 1000 Throckmorton, Fort Worth, Texas 76102
Attention. James Keyes, Director of Fiscal Services
Facsimile No (817) 871-8966
Telephone No (817) 871-8517
(b) Calculation Agent. The Calculation Agent is Party B, unless otherwise specified in a Confirmation in relation
to the relevant Transaction.
(c) Credit Support Document. Details of any Credit Support Document:-
In the case of Party B, a guazantee of Party B's obligations hereunder in the form annexed hereto as Exhibit
B
(d) Credit Support Provider Credit Support Provider means in relation to Party B Holdings.
(e) Governing Law This Agreement will be governed by and construed in accordance with. the laws of the State
of Texas (without reference to choice of law doctrine)
(f) Netting of Payments. Subparagraph (ii) of Section 2(c) of this Agreement will not apply to all Transactions.
(g) "Affiliate" will have the meaning specified in Section 12 of this Agreement.
(h) "Covered Indenture" means Ordinance No 10968 entitled "Master Ordinance Establishing City of Fort
Worth, Texas, Water and Sewer System Revenue Financing Program" (the "Master Ordinance") as
supplemented and amended from time to time in accordance with its terms, including, as of the date hereof,
by the First Supplemental Ordinance, the Second Supplemental Ordinance and the Third Supplemental
Ordinance (each as defined in the Fourth Supplemental Ordinance) and as further supplemented and amended
by the Fourth Supplemental Ordinance identified as Ordinance No and entitled "Fourth Supplemental
Ordinance Authorizing The Execution And Delivery Of Interest Rate Swap Agreements In Connection With
The City Of Fort Worth, Texas Water And Sewer System Finance Program, Declazing The City's Payment
Obligations Under Said Agreements As "Pazity Obligations" Under The Master Ordinance Establishing The
City Of Fort Worth, Texas Water And Sewer System Revenue Financing System, And Ordaining Other
Matters In Respect Thereto" (the "Fourth Supplemental Ordinance")
(i) "Covered Indenture Incorporation Date" means the date of this Agreement.
(j) "Government Entity" means Party A.
NA 143787.6 5
(k) "Bonds" means the (i) City of Fort Worth, Texas (Tarrant and Denton Counties) Water and Sewer System
Revenue Refunding and Improvement Bonds, Series 1996, (ii) City of Fort Worth, Texas Water and Sewer
System Revenue Refunding Bonds, Series 1991A and Series 1991B and (iii) City of Fort Worth, Texas Water
and Sewer System Revenue Refunding Bonds, Series 1993, and any other Bonds to be issued under the
Covered Indenture on a Parity Obligation as defined therein.
Part 4 Other Provisions.
(a) Obligations. Section 2(a)(iii) of this Agreement is hereby amended to read in its entirety asfollows.-
"(iii) Each obligation of each party under Section 2(a)(i) is subject to (1) the condition precedent that no Event
of Default, Potential Event of Default or Incipient Illegality with respect to the other party has occurred and
is continuing, (2) the condition precedent that no Early Termination Date in respect of the relevant Transaction
has occurred or been effectively designated and (3) each other applicable condition precedent specified in this
Agreement. "
(b) Representations.
(i) The introductory clause of Section 3 of this Agreement is hereby amended to read in its entirety as
follows.-
"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 (g), (h)
and {i) absent a written agreement between the parties expressly imposing affirmative obligations to the
contrary for a particular Transaction, and, in the case of the representations in Section 3(a) and 3(e), at all
times until the termination of this Agreement), that.-"
(ii) Section 3(a)(ii) of this Agreement is hereby amended to read in its entirety asfollows -
"(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 and made all necessary determinations and findings to authorize such execution, delivery and
performance, "
(iii) Section 3(b) of this Agreement is hereby amended to read in its entirety asfollows -
"(b) Absence of Certain Events No Event of Default or Potential Event of Default or, to its knowledge,
Incipient Illegality (in the case of a Government Entity) or 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 "
(iv) Section 3 of this Agreement is hereby amended by adding the following subsection "(e)" thereto,
which subsection shall apply only to the Government Entity -
"(e) Purpose of Agreement This Agreement has been, and each Transaction hereunder will be (and, if
applicable, has been), entered into for purposes of managing its borrowings or its financial positions,
consistent with the provisions of the Fourth Supplemental Ordinance, and not for purposes of speculation.
Not by way of limitation, Party A has entered into this Agreement specifically for the purpose of enhancing
the security for and/or to provide for the payment of principal or interest on the Bonds. "
(v) Section 3 of this Agreement is hereby amended by adding the following subsection "(f)" thereto
NA143787.6
"(f) No Reliance. In connection with the negotiation of, the entering into, and the confirming of the execution
of, this Agreement, any Credit Support Document to which it is a party, and each Transaction. (i) the other
party (or its Credit Support Provider, if any) is not acting as a fiduciary or financial or investment advisor
for it, (ii) it is not relying upon any representations (whether written or oral) of the other party (or its Credit
Support Provider, if any) other than the representations expressly set forth in this Agreement and in such
Credit Support Document, (iii) the other party (or its Credit Support Provider, if any) has not given to it
(directly or indirectly through any other person) any advice, counsel, assurance, guazantee, or representation
whatsoever as to the expected or projected success, profitability, return, performance, result, effect,
consequence, or benefit (either legal, regulatory, tax, fmancial, accounting, or otherwise) of this Agreement,
such Credit Support Document, or such Transaction, (iv) it has consulted with its own legal, regulatory, tax,
business, investment, financial, and accounting advisors to the extent it has deemed necessary and it has made
its own investment, hedging, and trading decisions based upon its own judgement and upon any advice from
such advisors as it has deemed necessary and not upon any view expressed by the other party (or its Credit
Support Provider, if any), (v) it has determined that the rates, prices, or amounts and other terms of each
Transaction and the indicative quotations (if any) provided by the other party reflect those in the relevant
mazket for similaz transactions, and all trading decisions have been the result of arm's length negotiations
between the parties, and (vi) it is entering into this Agreement, such Credit Support Document, and such
Transaction with a full understanding of all of the risks hereof and thereof (economic and otherwise), and it
is capable of assuming and willing to assume (financially and otherwise) those risks."
(vi) Section 3 of this Agreement is hereby amended by adding the following subsection "(g)" thereto,
which subsection shall apply only to the Government Entity•-
"(g) Assets of Party A. No person, firm, corporation, entity or association other than Party A may liquidate,
borrow, encumber or otherwise utilize the assets (inccuding without limitation the assets identified in Part
4(c)(iv)) of Party A. Party A has taken all steps necessary or advisable to create and perfect the pledge and
security interest in the assets identified in Part 4(c)(iv), and such pledge and security interest have been validly
created and perfected."
(c) Agreements.
(i) The introductory clause of Section 4 of this Agreement is hereby amended to read in its entirety as
follows -
"Each party agrees with the other (or, in the case of Section 4(d) and (e), the Government Entity agrees with
the other party) 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 -"
(ii) Section 4 of this Agreement is hereby amended by adding the following subsections "(d)" and "(e)"
thereto -
"(d) Compliance with Covered Indenture The Government Entity will observe, perform and fulfill each
provision in the Covered Indenture applicable to such Government Entity in effect on the Covered Indenture
Incorporation Date, as any of those provisions may be amended, supplemented or modified for purposes of
this Agreement with the prior written consent of the other party hereto (the "Incorporated Provisions"), with
the effect that such other party hereto will have the benefit of each of the Incorporated Provisions (including
without limitation, covenants, right to consent to certain actions subject to consent under the Covered
Indenture and delivery of financial statements and other notices and information) In the event the Covered
Indenture ceases to be in effect prior to the termination of this Agreement, the Incorporated Provisions (other
than those provisions requiring payments in respect of bonds, notes, warrants or other similaz instruments
issued under the Covered Indenture) will remain in full force and effect for purposes of this Agreement as
though set forth herein until such date on which all of the obligations of the Government Entity under this
Agreement and any obligations of the Government Entity or any Credit Support Provider of the Government
Entity under a Credit Support Document have been fully satisfied. The Incorporated Provisions aze hereby
NA 143787.6
3u 1 19. 1996 6 42PM R&W FAX DEPT 8 No, 6267 P 10/25
'(b) Abssrtcs of Certain EverrRS- No Event of Default or Potential Event of Default or, m its knowledge,
Intapiert Illegality (in the case of a Government Entity) or Termination fivent with respect to it has Occurred
end is continuing and no such event or circumstance would occur as a result of its entering into or performing
its obligations under this Agroenxmr or eay Credit Sbpport boettment tv which it is a party '
(iv) 5ecaon 3 of this Agrt~etneat is hereby atttended by adding the following subsection "(e)' thereto,
which subsection shall apply only to the Government Fntiry•~
"(e) Propose of Agnanesr. This Agreement has bees, and each Transaction hereunder will be (and, if
applicable, has bees!), entered into for purposes of managing its borrowings or its financial positions.
consistent with the provisions of the Fourth Supplemental Ordinance, and not for purposes of speculation.
Not by way of limitation, Party A has entered into this Agr'eemeat specifically for the purpose of enhancing
the security for and/or to provide for the payment of principal or interest on the Bonds.'
(v) Section 3 of this Agreement is hereby amended by adding the following subsection "(f)" thereto:
"(f) No Reliance. In connection with the negotiation of, the entering ratto, and the wnfirmiag of the exeeudon
of, this Agreement. any Credit Support Document to which it is a parry, and each Transaction: (i) the other
parry (vr its Credit Support Provider, if any) is ~t acting as a fiduciary or financial or investment advisor
for it; (ii) it is not relying upon any t+epresentations (whether written or oral) of the oth~ar party (or its Credit
Support Provider, if any) other thaw the representations expressly set fonh in this Agreement and is such
Credit Support Doa:ment; (iii) the other parry (or its Credit Support Provider, if any) has not given to it
(directly or indirectly through any other person) any advice, counsel, assurance, guarantee, yr representation
whatsoever as to the expected or projected success, pmf:tability, return, perfotmattoe, result, effect,
consequence, or bdoef t (either legal, regulatory, tax, financial, acxountirtg, or otherwise) of this Agreement,
such Credit Support Document, or such Transaction; (iv) it has consulted with its own legal, regulatory, tax,
business, investment, fmaneial, and aooountin,g advisors to the exrent it has deemed accessary and it has made
its own investment, hedging, and trading decisions based upon its own judgement and upon any advice from
such advisors as tt has deerncd necessary and not upon any view expressed by the other party (or its Credit
Support Provider, if any); (v) it has determittod tbaz the races, prices, or amounts and other tarns of each
Transaction and the indicattve quotattotts (if any) provided by the other parry reflect those in the relevant
market for similaz transactions, and all trading decisions have bees the result of arm's length tugotiations
between the parties, and (vi) it is entering into this Agreement, such Credit Support 6oeununt, and such
Transaction with a full understanding of all of tltc risks hereof and thett:of (ecoztotnic and otherwise), and it
is capable of assuming and willing to assume {financially and otherwise) those risks."
(vi) Beacon 3 of this Agr+eettteat is hereby ame~ed by ceding the following subsection "(g)" thereto,
which subsection :hail apply only to the Govetttment F~hty-
"(g) Assets of i'rarty A. No person, firm, wrporarion, entity or association other than parry A tttay liquidate,
borrow, encumber or otherwise utilize the assets (irtlcudit4g without limitation the assets idemified in Pan
4(c)(iv)) of Party A. Patty A has taken alt steps necessary or advisable to create and perfect the pledge and
security interest in the assets tdettttfied in Part 4(e)(iv), and such pledge and security interest brave been validly
Cleated and perfected."
wwlmt~.~ 7
~ Section 3 of this Agreement is hereby ama,ded by addin¢ the followin¢ subsection "(h)" thereto.
which subsecrio~ shall aoyly only to the Government l:ntitv:-
Jul 19. 1996 8 43P1~
(c) ~gmrrtaaus.
R&W FAX DEPT 8
r. ,;~:
No. 6267 P 11/25
(i) The introductory clause of Section 4 of this Agreement is hereby aatcrtded to read in its entir>;ty as
follows -
"Each patty agrees with the other (or, in the case of Section 4(d) and (e), the Government Entity agrees with
the other party) thaz, so long as either patty has or miry have any obligation under this Agreenoeat or tinder
airy Credit Support boeument to which it is a party-'
(ii) Section 4 of this Agreement is hereby amended by adding the following aubsectioos "{d)" and '(e)"
thereto:
'(d) Compliance with Covered !'irdantrtte. The Government Entity will observe. perform and fulfill each
proviaron in the Covered Indenture applicable to such Government Entity Ia effect on the Covered Indentie
Incorporation Date, as any of there provisions stay be art-eoQed, suppllmeuted or modified for purposes of
this Agreement with the prior written consent of die other party hereto (the "lrtcotporated Provisions"), with
the effect that such other party hereto will have die benefit of each of the Lrtc~porated provisions (including
without limitation, covenants, right to consent to certain actions subject to consent under the Covered
Indenture and delivery of financial atatemeitts and other notices and information). In the event the Covered
Indenture ceases to be in effect prior to the termination of this Amt, the Incorporated Provisions (other
than those provisions requiring payments in respect of bonds, notes, warrmtts or other similar instruments
issued under the Covered Indenture) will r+ernain in full force and effect for purposes of this Agreement as
though set forth herein until ouch date on which all of the obligations of the Govcrntnent Entity under this
Agreement and any obligations of the Govemitteat Eruiry or any Credit Support Provider of the Government
Entity under a Credit Support Document have been fully satisfied. The Incorporated Provisions art: hereby
incorporated by ceferenec and made a part of this Agreement to the same extent as if such provisions were
set forth herein. For purposes of this Agteemettt, the lncotporated Provisions shall be oonsuued as though
(i) all references therein to any party making loans, extensions of ct+edit or fiaarreiai accotrrmodations
thereunder or commitments therefor (the "Financings") were to the odor party hereto and (ii) to the accent
that such Incorporated Provisions are conditioned on or relate to the existence of such Financings or the
Governtneat Entity having any obligations in eaa>nection therewith, all referent.cs t0 such Pinancings or
obligations were to the obligations of the Covernrnent Entity under this Agreement. Any amendment.
suppicutertt, modification or waiver of nay of the Incorporated Provisions without the prior written consent
of the other party hereto shall have no force and effect with respect to this Agreemrslt. Any amendment,
supplement or modificattoa for which such consent is obtained shall be part of the Incorporated Provisions
for purposes of this Agt'eetr,eat.
(e) Notice oj,trtcrpterrt RlegalYty If au Incipient Illegality occurs, the Government Entity will, Promptly
upon bccor,uing aware of it, notify the other Patty, specifying the nature of that Incipient lllegaliry and will
also give such ocher information about that Incipient Illegality as the other patty racy reasonably require.,
(iii) Sa,tioa 4 of this Agreement is hereby amended by adding the following subsection '(f)' thereto:
'(f) soa,te of Payments. This Agreement shad constitute a "Parity Obligation' as such term is defined in
Exhibit A to the Master Ordinance and as ail such amounts payable w Party 8 by Party A pursuant to this
Agreement shall be payable on a parity with the Bonds and the other Parity Obligations in accordatrce with
the temps of the Foitrth Supplemental Ordinance. Amognts payable by Party A hereunder shall be payable
solely from Pledged Reveatus as provided in the Covered htdenture and 85 such term is so dCfined in the
- Covered htdenture."
wu+am.v
incorporated by reference and made a part of this Agreement to the same extent as if such provisions were
set forth herein. For purposes of this Agreement, the Incoipor'ated Provisions shall be construed as though
(i) all references therein to any patty making loans, extensions of credit or fmancial accommodations
thereunder or commitments therefor (the "Financings") were to the other party hereto and (ii) to the extent
that such Incorporated Provisions are conditioned on or relate to the existence of such Financings or the
Government Entity having any obligations in connection therewith, all references to such Financings or
obligations were to the obligations of the Government Entity under this Agreement. Any amendment,
supplement, modification or waiver of any of the Incorporated Provisions without the prior written consent
of the other party hereto shall have no force and effect with respect to this Agreement. Any amendment,
supplement or modification for which such consent is obtained shall be part of the Incorporated Provisions
for purposes of this Agreement.
(e) Notice of Incipient Illegality If an Incipient Illegality occurs, the Government Entity will, promptly
upon becoming awaze of it, notify the other party, specifying the nature of that Incipient Illegality and will
also give such other information about that Incipient Illegality as the other party may reasonably require.
(iii) Section 4 of this Agreement is hereby amended by adding the following subsection "(f)" thereto -
"(f) Source of Payments. This Agreement shall constitute a "Parity Obligation" as such term is defined in
Exhibit A to the Master Ordinance and as all such amounts payable to Party B by Party A pursuant to this
Agreement shall be payable on a parity with the Bonds and the other Parity Obligations in accordance with
the terms of the Fourth Supplemental Ordinance. Amounts payable by Party A hereunder shall be payable
solely from Pledged Revenues as provided in the Covered Indenture and as such term is so defined in the
Covered Indenture "
(d) Jurisdiction and Immunity Sections 11(b) and 11(c) of this Agreement aze hereby deleted in their entirety
from this Agreement.
(e) Definitions. Section 12 of this Agreement is hereby amended to add the following definitions in their
appropriate alphabetical order•-
" `Bonds' has the meaning specified in the Schedule. "
" `Covered Indenture' has the meaning specified in the Schedule."
" `Covered Indenture Incorporation Date' has the meaning specified in the Schedule."
" `Government Entity' has the meaning specified in the Schedule. "
" `Incipient Illegality' means (a) the enactment by any legislative body with competent jurisdiction
over the Government Entity of legislation which, if adopted as law, would render unlawful (i) the
performance by such Government Entity of any absolute or contingent obligation to make a payment
or delivery or to receive a payment or delivery in respect of a Transaction or the compliance by such
Government Entity with any other material provision of this Agreement relating to such Transaction
or (ii) the performance by the Government Entity or a Credit Support Provider of such Government
Entity of any contingent or other obligation which the Government Entity (or such Credit Support
Provider) has under any Credit Support Document relating to such Transaction, (b) any assertion in
any proceeding, forum or action by the Government Entity, in respect of such Government Entity
or in respect of any entity located or organized under the laws of the state in which such Government
Entity is located to the effect that performance under this Agreement or similaz agreements is
unlawful or (c) the occurrence with respect to the Government Entity or any Credit Support Provider
of such Government Entity of any event that constitutes an Illegality "
Miscellaneous
NA 143787.6
(f) Confirmation. A form of Confirmation is set forth as Exhibit A hereto
(g) "Stockholders' Equity" means with respect to Holdings, at any time, the sum at such time of (i) its capital
stock (including preferred stock) outstanding,. taken at par value, (ii) its capital surplus and (iii) its retained
earnings, minus (iv) treasury stock, each to be determined in accordance with generally accepted accounting
principles.
NA 143787.6 9
The parties executing this Schedule have executed the Master Agreement and have agreed as to the
contents of this Schedule.
LEHMAN BROTHERS SPECIAL FINANCING INC.
By•_
Title:
CITY OF FORT WORTH, TEXAS
By•
Title: City Manager
Attest:
By•
Title: City Secretary
Approved as to form and legality
By
Title: City Attorney
Sul 19.1996 8 43PM R&W FAX DEPT 8
EXHIBIT A to SchQdtrle
Form of Confirmation
No, 6267 P 12/25
[Dace]
City of Fort Worth, Texas
1000 Throclcatorton
Fort Worth, Texas 76102
Ladies and Gentlemen:
TRANSACTIdN
The purpose of this letter agreement is co set forth the terms and conditions of the Tratsaction entertd
into between us on the Trade Date apocifiod below (tlt~ "Transaction'). 's letter agreement constitutes a
'Confirnaatioe' as referred to in the Master Agreement specified below
The definitions and provisions contained in the 1992 ISDA U.S. Municipal Counterparry Definitions
(as published by the International Swap Dealers Associatron, Inc.) (the °Definitions"). are ittcarporated into this
Confirmation. [n the event of any inwnsistency between those Definitions and this Confirmation. this Confirmation
will govern.
1 This Confirmation supplements, forms part of, and is subject to the Master Agreement dated
~ as of July " 23, 1996 (the 'Agreement") between you and us. All provisions contained in the Agreement govern
this Confirmation except as expressly modified below
2. The teens of the par[ieular Transaction to which this Confumation relates are as follows~-
Party B: LEHMAN BROTHERS SPECIAL FINANCING INC.
Party A. CITY OF FORT WORTH. TEXAS
[Notional Amount:]
Trade Date.
Effective Date:
Termination Date:
FIXED AMOUNTS.
Fixed Rate Payer:
[)~ixed Rate Payer
Currency Amount:)
[Parry B!A]
EXHIBIT A
Page 1
rv~tu~n.z
Fixed Rate Payer Payment Dates [or, Period [ ], subject to adjustment in accordance with the
End Dates, if Delayed Payment or Eaazly [Following/Modified Payment or [Following/Preceding]
Payment applies] Business convention, with respect to a
Banking Day and a Banking Day [with
No Adjustment of Period End Dates]
(Fixed Amount:J
Fixed Rate:
Fixed Rate Day Count Fraction.
FLOATING AMOUNTS
Floating Rate Payer•
[Party A/B]
[Floating Rate Payer
Currency Amount.]
Floating Rate Payer Payment Dates [or, [ ], subject to adjustment in accordance with the
Period End Dates, if Delayed Payment or [Following/Modified Payment or [FollowinglPreceding]
Early Payment applies] Business convention, with respect to a
Banking Day and a Banking Day (with
No Adjustment of Period End Dates]
Floating Rate for initial Calculation Period.
Floating Rate Option.
Designated Maturity
Floating Rate Spread.
Floating Rate Day Count Fraction.
Reset Dates
[plus/minus] % p.a.
[Rate Cut-off Dates.]
[Method of Averaging•
Unweighted/Weighted Average Rate]
Compounding Applicable/Inapplicable
[Compounding Dates.]
[Initial Exchange:
Initial Exchange Date•
Party B Initial Exchange Amount:
EXHIBIT A
Page 2
NA143787.6
Party A Initial Exchange Amount.
Final Exchange:
Final Exchange Date:
Party B Final Exchange Amount: '
Party A Final Exchange Amount:]
Calculation Agent.
3 Account Details
Payments to Party B
Account for payments in [first currency] [ ]
Account for payments in [second currency] [ ]
Payments to Party A
Account for payments in [first currency] [ ]
Account for payments in [second currency] [ ]
4 Offices
The Office of Party A for the Transaction is [ ]
5 [Broker/Arranger ]
EXHIBIT A
Page 3
NA 143787.6
Please confirm that the foregoing correctly sets forth the terms of our agreement by executing the
copy of this Confirmation enclosed for that parpose and returning it to us.
Yours sincerely,
LEHMAN BROTHERS SPECIAL FINANCING INC.
By•
Name:
Title:
Confirmed as of the
date first written
_CITY OF FORT WORTH, TEXAS
By•
Name:
Title: City Manaeer
Attest.
By
Name:
Title. Citv Secretary
Approved as to .form and legality
By
Name
Title• City Attorney
EXHIBIT A
Page 4
NA143787.6
Jul 19.1996 8 44PM R&W FAX DEPT 8 No 6267 P 13/25
EXIIIBrr s to schedule
GUARANTEE OF L>?HMAN BROTHERS MOLDINGS INC.
LEHMAN BROTHERS SPECiAI, FINANCING INC. ("Parry B') and CITY OF FORT WORTH,
TEXAS ("Parry A') have entered into a Master Agreement dated as of July ^ ~3, 199ti, pursuant to which Patty
B and Party A have entered and/or anticipate entering into one or more transactions (each a "Transaction'), the
Coafirmatioa of each of which supple~ts, forms part of, and will be read and construed as one with, the Master
Agreement (cOllectively_ referred to u the "Agrcement"). This Guarantee is a Credit Support bocumeat as
eontetnplated in the Agreement. For value received, and inconsideration of the financial accotnrnodatrvn accorded
to Party B by Party A under the Agreement, LEHMAN BROTHERS HOLDWGS INC., a corporation organized
and existing under the laws of the State of Delaware ("Guarantor'), hereby agrocs to the following:
(a) Guarantor hereby uoC011ditionally guarantees to Party A the due and punctual payment
of all amounts payable by Parry B under each Transaction whw and as Party B's obligations thereunder shall
become due and payable in accordance with the terms of the Agreement. In case of the failure of Party B to pay
punctually any such amounts, Guarantor hereby agrees. upon written demand by Patty A, to pay or cause to be paid
any such amounts punctually when and as the satin shall become due and payable_
(b) Guarantor hereby agrees that its obligations under this Guarantee constitute a guarantee
of payment when due and not of collection.
(e) Guazantor hereby agrees that its obligations under this Guarantee shall be unconditional,
irrespective of the validity, regularity or enforceability of the Agreement against Parry B (other than as a result of
the unenforceabiliry thereof against Party A), the absence of any action to enforce Party B's obligations under the
Agreement, any waiver or consent by Party A with rcapxt to any provisions thereof. the entry by Party B and Party
A into additional Transactions .under the Agreement or any other eirc±~.,,~!~-^-ce which might otherwise constitute a
legal or equitable discharge or defense of a guarantor; vidcd, however, thaz Guarantor shall be entitled Oo
exercise any right that Party B could have exercised under the Agreement to cure any default in respect of its
obligation under the Agreement or to set off, counterclaim or withhold payment in respect of nay Bvent of Default
or potetrtral Event of Default in respect of Patty A or any Affiliate, but only to the extent such right is provided to
Party B utzder the Agreement. The Guarantor aciwowledges that Party B and Party A taay from tune to time inter
Into oAC or more Transactions pursuant to the Agreement and agrees that the obligations of the Guarantor under this
Guarantee will upon the execution of nay such Transaction by Party S and Party A extend to all such Transactions
without the taking of further action by the Guarantor
(d) Guazantor shall be subrogated to all nghts of Party A against Party B in respecx of any
amounts paid by Guarantor pursuant to the provisions of this Guataatce; rop vided, however, that Guarantor shall
not be entitled to enforce or to receive any payments arising out of, or based upon. such tight of subrogation until
all amounts then due and payable by Parry B under the Agroetnent, shall have been paid in full.
(e) Guarantor further agrees that this Guarantee shall continue to be effective or be reinstated,
as the case may be, if at any time, payment. or any part thereof, of any obligation or interest thereon is rescinded
or must otherwise be restored by Party A upon an Event of Default as ~ forth m _ action 5(al(yii) of the Agreement
affecting Party B or Guarantor
(fl Guarantor hereby waives (i) promptness, diligence, presentment, demand of payment,
pretest, order and, except As set forth in paragraph (a) hereof, notice of any kind in ooulnection with the Ap~eement
and this Guarantee, or Vii) any requirement that Parry A exhaust any right to take airy action against Party B or any
other person prior to or contemporaneously with proceeding to exercise aqy right against Guarantor under this
Gttardntee.
EXHIBIT >3
Page 1
NAIII7aT.7
Guarantor makes the same representations to and agreements with Party A as those made by Pazty
B pursuant to Sections 3 and 4 of the Agreement, at the times set forth therein, except that references therein to
"the party" will be deemed to be references to "the Guarantor" and references therein to "the Agreement" will be
deemed to be references to "the Guarantee. " Section 11 of the Agreement is incorporated by reference in this
Guazantee except that references therein to "the Agreement" will be deemed to be references to "the Guazantee."
This Guazantee shall be governed by and construed in accordance with the laws of the State of
New York, without reference to choice of law doctrine. All capitalized terms not defined in this Guazantee are
defined in the Agreement.
Any notice hereunder will be sufficiently given if given in accordance with the provisions for
notices under the Agreement and will be effective as set forth therein. All notices hereunder shall be delivered to
Lehman Brothers Holdings Inc., Attention. Treasurer, at 388 Greenwich Street, 6th Floor, New York, New York
10013 (Telex No 175636 Answerback: SLB, Facsimile No (212) 464-6414) with a copy to Lehman Brothers
Special Financing Inc., Attention. Senior Vice President at 200 Vesey Street, 7th Floor, New York, New York
10285 (Telex No 175636 Answerback. SLB, Facsimile No (212) 528-6927)
IN WITNESS WHEREOF, Guazantor has caused this Guazantee to be executed in its corporate
name by its duly authorized officer as of the date of the Agreement.
LEHMAN BROTHERS HOLDINGS INC
By
Title:
EXHIBIT B
Page 2
NA 143787.6
Jul 19.1996 8 44PM R&W FAX DEPT 8 No 6267 P 14/25
EXIiIBIT C to Schedule
[Form of 4pvnion of Counsel to
Lehman Brothers Special Financing Inc_ and
L,chman Brothers Holdings Inc.]
f~~]
City of Fort Worth, Texas
1000 Throckmorton
Fort worth, Texas 76102
Indies and Gentlemen:
i have acted as counsel to Illtman Brothers Special Financing Inc., a Delaware corporation ("Party
B") and Lehman Brothers Holdings inc., a Delaware oorpotation ("Guarantor"). and am familiar with matters
pertaining to the execution and delivery of the Master Agreement (the 'Master Agreement') dated as of July " 23,
1996 between Party B and City of Fort worth, Texas ('Parry A") and the gttaraa[ee of Guarantor (the "Guarantee`)
delivered in connection with the Master Agreement. The Master Agreement is to be supplemented by confirmations
of transactions to be entered into by Parry B and Party A from time to dme (each a 'Confirmation") and the Master
Agreement together with all such Confirmations shall constitute one agreenratt.
In connection with this opinion, I have examined or bad examined on ray behalf an execution copy
of the Master Agreement and the form of Confumation attached thereto, the Guarantee, certificates of public
officials and officers of Party B and Guarantor' and such other documents as 1 have deemed necessary or appropriate
for the purposes of this opinion. In such opinion, I have assumed the genuineness of ail the aignatuirs, the
authenticity of all documents submitted to me as originals and the oonfortniry to authentic original documents of all
documents submitted to sne as certified, conformed or photostatic copies. I have also assumed thaz each
Confrrmatron will be in substantially the form of Exhibit A to the Master Agreement.
Based upon the foregoing, I am of the opinion tbat:
1 Each of Pasty B and Guarantor is a corporation duly organized, validly existing and in
good standing under the laws of Delaware.
2. The execudon, delivery and perfvrrriraice ofthe Master Agrettnettt and each Confirmation,
in the cage of parry B, and the Guarantee, in the case of Guarantor, are within its corporate power, have been duly
authorized by all necessary corporate action and do not, or, itt the case of party B with respect to each
Confirmation, will not, conflict with any provision of its articles of incorporation or by-laws.
3 The Master Agreetuetit, in rite case of Party B. and the Guarantee, in the case of
Guarantor, has been duly executed and delivered and constitutes, and in the cast of Patty 8 with respect to each
Confirtnahon, upon due exaution and delivery by Patty B, will constitute, a legally valid and binding obligation,
enforceable against itsn accordance with its terms (subject to applieablt bankruptcy, ttorgauiZation, insolvetuy,
moratorium or similaz laws affecting creditors' rights generally and subject, as to enforceability, to equitable
prineipks of general application (regardless of whether enforcement is sought in a proceeding inequity or at law)).
4 To the best of my knowledge no consent, authorization, license or approval of or
registration or declaration with, any United States of America federal or New York governmental authority is
required in wnnection with the execution, delivery and performance of the Master Agreement and each
Confirmation, in the case of Party B, and the Guazantee, in the case of Guarantor
FJGiIBTf C
Page 1
w-~~s~n.t
The opinions expressed herein aze limited to matters concerning the federal laws of the United
States of America, the laws of the State of New York and the General Corporation Law of the State of Delawaze.
Very truly yours,
EXHIBIT C
Page 2
NA143787.6
.::
Jul 19.1996 8 45PM R&W FAX DEPT 8
I;XHIBI"I' 1) to Schedule
(Form of Opinion of Counsel to Party AJ
No 6267 P 15/25
tlaau]
Lehman Brothers Speciat F'iaaacing Inc.
zoo Vcsey Street
World Financial Cez<tcr
New York, New York 10285
Lehman Hrorl-ers Holdings Inc.
388 Greenwich Street
6th Floor
New York, New York 10013
ladies and Gentleatea:
We have acted as counsel to the City of Fort Worth, Texas, a polities! subdivision and nttmieipal
cotpoxation of the State of Texas ('Party A') in connection with the execution and delivery of the Master Agreement
(the "Master Agroeruent") dated as of 3uly " 23, 1996 between Lehman Brothers Special Financing Inc. ("Party B')
and Parry A. The Master Agreement is to be supplemented by confirttrazions of Transactions to be entered into by
Party B and Party A from time to [ime _(tach a "Confustoa[ion") and the Master Agreemetti together with all such
Confirmations shall constitute one agreement.
In comrecdon with this opinion, we have examined an executed copy of the Master Agreement and
the form of Confirmation aztached thereto and such documents and records of Party A, oertifica~es of public officials
and officers of Party A and such ottrer documents as we have domed rtaxssary or appropriate for the purposes of
this opinion. ht such opinion, we have assumed the genuineness of aII the signahues, the authenticity of all
documents submitted to us as originals and the conformity to authentic original documents of all documents
submitted to us as cettifed. conformed or photostatic copies.
Based upon dte foregoing, we are of the opinion that:
1 Party A is a political subdivision and municipal corporation of the State of Texas duly
organized and validly existing under the taws of the State of Texas, including Party A's Home Rule Chatter
2. Party A is authorized under [specify statutory and/or regulatory authority) to enter into
the Master Agreement and to perform tits obligations therevndd' and under the Confirmation tittered into pursuant
to and which form a part of the Master Agreement.
3 Party A has takan all accessary atxion trquircd to be tulcert to ensure that the Master
Agreement and the Confirmation emered into pursuant to and which form a part of the Master Agreenteat comply
m ail respects with (specify statutory and/or regulatory authority).
4 The Master Agreement has been duly executed sad delivered by Party A and constitutes,
and e8ch Confirntarion, upon due execution and delivery by Party A, will constitute, a legally valid and binding
oblRgation of Party A enfot+eeable against Party A in accordance with its terms (subject to applicable bankntptcy,
reorganization, insolvency, moratorium or similar laws affecting creditors' rights generally and subject, as to
enforoeabiliry, to equitable principles of general applicazion (regardless of whether enforcement is sought in a
proceeding in equity or at 1aw)).
FX1iIBiT b
Page 1
r+~Nrn.~
`§xg e
Jul 19.1996 8.45PM R&W FAX DEPT 8 ~ No 6267 P 16/25
S. To the best of our loaowledge, no consent, authorization, liceASe or approval of, or
registration or declaration with, any governmental authority is required in wnnection with the execution, delivery
and performance of the Master Agreement and each Confirmazion by Party A.
I"
Very truly yours.
1~IIBIT D
Page 2
NAU77~7.7
Jul 19.1996 8 46PM R&W FAX DEPT 8 No 6267 P 17/25
E,XHiBIT E to Schedule
Form of Resolu toes
RESOLVF.b that (i) the City of Fort Worth, Texas (the "City") inter into interest rate swap and
any similar transactions and (n) the form, terms and provisions of the Master Agreement (the 'Agreement") dated
as of July " 23, 1996, between Lehma» Brothers Special Finaneiag inc. ('L,ebman') and the Ciry, in the form
previously presented to the City (with such changes, not inarosistent with the intent of these resolutions and the
intent of the Board of Directors as the officer(s) executing the same, as evidencod by then execution thereof, shall
deem necessary or desirable), and the actions contemplates thereby (including the entry by the Ciry ittto'I1ransactions
with I.ettman evidenced by eoafumations thtrcof) be, amt they hereby are, in all resptxts approved, authorizod,
adopted, tatifitd and wnfirmed_
RESOI.VEb that the City is hereby authorized to enter into the Agroemqu, in substantially the
form presented to this meetittg and, from time to time, one of mare interest rau swap transactions sad agreements
terminating any such interest rate swap transaction, pursuant to the Agreenent and the da~ttments (each a
"Confirmation") exchanged between the parties confirming such interest rare swap tr~msactioas. The terms of each
interest raft swap transaction, including interest rate, term, Notional Amount (is defined in the Agtncanatt) aid
opaons as to comtntne~meat and termination of payments, and each termination agreement shall be as described
in the Agreement and as provided is the related Confirmation, as approved from time to time by the officers of the
Ciry authorized to execute the Confirmation. The aggregate Notional Aaiouat, as defined in the Amt, of such
interest rate swap transactions outstanding at any one tithe, net of offsetting interest rate swap transactions, shall
not exceed $ and each such interest rate swap transaction shall terminau not exceeding years
after rts effective dart. The aggregate Notional Amount of all such interest rate swap transactions as of any time
shall be determined on a net basis, i.e., where: any such transaction is catered into to offset or reverse an earlier
transaction, to the extent of the offset[ing or reversing effect, the Notional Amounts of such offsetting or reversing
interest rate swap transactions shall not be included is the aggregate total.
RESOLVED that the actions contemplated in the Agreemtrit, aid each Confirmation, are hereby
in all respects approved. authorized, adopted. ratified and confirmed.
RESOLVED that all officers or officials of the City be, and each of them hereby is, authorized
to eatectite and deliver (i) [tie Agreement in the frame and on behalf of the City and if necessity or advisable under
iu corporate seal (which may be attested by the [Secretary or say Assistant Secretary or the equivaldu thereof) of
the City) or otherwise and (ii) such other agreements and doettmeats as are contemplated by the Agreemtttt or are
otherwise necessary in Connxdon with entering into interest rate swap and any similar ttartsaetioat, as airy such
officer or official shall deem appropriate, including without limitation, officer certificates, legal opinions and credit
support doct~euts.
RESOLVED that all officers or officials of the City and its agents and ooutuiel be. sad each of
them hereby is, suthorizcd to take all such further actions, to execute and deliver such further instruments sod
documents in the same and on behalf of the City and if necessary or advisable under its wrporate seal (which may
be attested by the [Secretary or any Assistant Secretary oz the equivalent thereof] of the City) or otherwise to pay
all such expenses as in his judgment shall be necessary or advisable in order fully to carry out the purposes of the
foregoing resolutions.
RESOLVED that au actions previously taken or that will be taken by any director. officer, official,
employee or agent of the City in connection with 0~ related to the matters set forth in or reasonably Contemplate!
by the forgoing resolutions be, sad each of them hereby is, adopted, ratified, eonfitoned aid approved in all
- - respects as the acts and deeds of the City
EXHIBIT E
Page 1
NAtarri7J
Jul 19.1996 8 46PM R&W FAX DEPT 8 No 6267 P 18/25
EXHIa1T F to Schedule
Officer's Certificate
The undersigned the [Chief Executive Offieerj [Chief Financial Officer] of the City of Fort Worth,
Texas (the "City') hereby certifies in connoction with the Master Agreement (the "Master Agreement") dated as
~ of ]uly " 23, 1996, between L.chznan Brothers Special Financing lac. ("Lehmaur') sad the Clty that:
(i) the City bas taken all action requured to be taken to ensure that the Master Agreement
and any Confirmation entered into or to be entered imo, and the Tratisactioac
contemplated thereby, are authorized under and comply in all respects with [specify
statutory and/or regulatory authority) (the 'Statute"), [its charter and/or its by-lawsj,
including,
(set forth atry actions required by the Statute to be takat];
(ii) the City is entering into the Master Agreement and any Transactions ettt!ered into or to
be pntcced into thereunder, for hedging purposes and not for the purpose of speculation;
sad
(iii) the City meets all the requirements of the Statute not referred to above including:
[sex forth any requirements of the Statute not referred to above, such
as 'the Ciry is entering into the Transaction in oonneetion with or
incidental to the sale and issuance of bonds"~.
Capitalized terms used but not defined herein shall have the respective meanings ascribed to such
ternos in the Master Agreement.
IN WITNESS WHEREOF. this Certificate has been executed as of this day of
EXHIBIT F
Page t
NAIg7e1,7
Jul 19.1996 8 47PM R&W FAX DEPT 8 No. 6267 P 19/25
EXHIBIT G to Schedule
'Exvosure Calculation Date' means the first dsv of each calendar month. or if say s_uch_d_av does
not fall on a Business bay, then the folIowittQ day thaz is a Business Dav.
"Minimum Amount' means SSOQ.000.
2.
EXHIBIT G
Page 1
~~.~
Accordinely. the parties hereto aeree as follows:
-- ~.~
"Equivalent Collateral' n~_ with respect to am Collateral, securities of the same or similar
cla~aad issue. issuer. series and maturity and the same Drinci~l amount.
:m. k r~
Jul 19.1996 8 47PM R&W FAX DEPT 8 No 6267 P 20/25
~XHIBTt G
Page 2
w-imn.~
}4v
Jul 19..1996 8 48PM R&W FAX DEPT 8
EXHIBIT G
Page 3
No. 6267 P 21/25
NAllYA7.7
_ ..... '.A.'~ `
Jul 19.1996 8 49PM R&W FAX DEPT 8 No 6267 P 22/25
~s.
i~.
EXHIBIT G
Page 4
ruu».~
Jul 19.1996 8 50PM R&W FAX DEPT 8
No 6267 P, 23/25
LEH~~ THERS SPECIAL FINANCING INC.
Bv:
Title:
CITY OF FORT WORTI~1. T13?CAS
$y:
Name:
'Title: City Manaeer
Attes[_
~~~
~x.,~,
Name:
Title: City Sec[ztanr
Ann or ved a9 co form snd leealitw
13v: -
Name:
Title: Ciro Attomev
EXHIBIT G
Page S
w-ium_~
Jul 19.1996 8 50PM R&W FAX DEPT 8 No 6267 P, 24/25
R&W Draf:
' 7/19/96
July " ~ 1996'
City of Fort Worth, Texas
1000 Throcltmorton
Fort Worth, Texas 76102
Dter Indies and Gentlemen:
The purpose of this letter agreement is to confirm the terms and conditions of the transatxion (the "Transactivn")
enteral into between Y.ehmaa l3mthers Special Financing Inc. ("I.$SF") and Ciry of Fort'Wotth, Texas ("Counterparty")
on the Trade Date spectfied below This letter agrp~ttteAt COnsdtutes a 'Confutnation' as referred to in the Master
Agreement specified below The Transaction relates w the (i) City of Fort Worth, Texas (Tarram and Denton Counties)
Water and Sewer System Revenue Refunding and lmpcnvemenc Bonds, Series 1996. (ii) City of Fort Wottlz, Texas Water
and Sewer System Revenue Refunding Bonds, Series 1991A and Series 1991B and (iii} City of Fort Worth, Texas Water
and Sewer System Revenue Refunding Bonds, Series 1993, and any other Bonds t0 be Issued under [he Covexed Indenture
(~ "~~")-
The definitions and provisions contained in the ! 992 ISDA U. S. Municipal Counterparry Definitions (as published
by the International Swap Dealers Association, Inc.) ate inwtparated into this Confirttzativn. In the event of qtly
inwnsistency between those dcfinitrons and provisions of this Confirmation, this Confirmation will govern.
1 This Confirmation supplements, forms part of, and is subject to, the Master Agt+eetnent dated as of "
]u~, I996, as amended aad supplenrenttd from time to rime (the "Agrecmertt"). between Couaterparty and I.BSF
All provisions contaisted in the Agreement govern this Confirmation except as specifically modified below.
2. The terms of the particular transaction to which this Confirmation relates are as follows:
Notional Amount:
Trade Date:
Effective Darc:
Termination Dace:
Fixed Amounts:
Filed Rate Payer-
SZ0,000,000
July " 23, 1996
" Au ust 15 1996
August 1, 2001
LSSF
Fixed Rate Payer Payment Dates: Each August 15 attcl February 15, oommencirtg February 15, 1997,
with the final Payment Daze being August 15, 2001, subject to
adjusttreat itt accordance with dte Following Business Day
Convention.
Fixed Rate Payer Period fi~ Dates: Eadt August 1 and February 1, commencing Febtztary 1, 1997 No
Adjustment shall apply to Period land Dates.
NA1720tOJ
Jul 19.1996 8 50PM R&W FAX DEPT 8 No. 6267 P 25/25
Dry" means any day ocher than a Saturday. a Sunday, a day on
which commercial banks in New York City are required to be closed
or a day on which the New York Stock Exchange is eloscd.] [other
3. Payments to LBSF• Cvunterparty will cause the Paying Agent on the Bonds to pay directly to LBSF any
monies due hereunder from appropriate sout+ces for such payment on or before each payment date via federal funds wire.
4 Account Information=
Payments io LBSF• "The Chase Manhattan Bank NY
ABA No. 021000 " 0'11
Account No_ 098 900 20
for the Aoooum of Lehman RroWers
Special Financing Inc.
Payments to Countetparty " Ban~kOne. Texas/Cust
ABAA~ 1110-0061
City rt Worth. Texas
AcctA- 1180121202
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
fiwf71010.3 3
EXHIBIT C
FORM OF GBDP AGREEMENT
C-1
Jul 19.1996 7 55PM R&W FAX DEPT 8 No 6266 P 4/13
EXECUTION COPY
(Local Currcnc~~Single Jurisdiction)
,~
ISDA.
International Swap Dealers Association, Inc.
MASTER AGREEMENT
dated as of ]uly " 23, 1996
GBDP. L.P and City of Fort Worth, Texas have entered and/or anticipate•entering into one or more
transactions (each a "Transaction') that are or will be governed by this Master Agreemcnt (the "Master
Agreematt"). which includes the schedule (the "Schedule'), and the documents and other wnfirming evideatx (each
a "Confirmation') exchanged between the patties confirming those Transactions.
Accordingly, the patties agree as follows:-
)l. )(rrtdpr'etation
(a) IkJinieions. The terms defined in Section 12 and in the Schedule will have the meanings therein specified
for the purpose of this Master Agreement.
(b) Inconsistency In the event of any tncotrststency between the provisions of the SChahtle and the other
provisions of this Master Agreement, the Schedule will prevail. [n the event of any mwnaistenry between the
provisions of any Confirmation and this Master Agreement (ineltrdmg the Schedule), such Confirmation will prevail
for the purpose of the relevant Transaction.
(e) Surglt Agr+eerwent_ 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 zEferred to as this 'Agreement"),
and the parties would not otherwise enter into nay Transactions.
2. ObGgstions
(a) General Conditions
(i) Each party will make cash payment or delivery specified in each Confirmation to be made by
it, subjeu to the other provisions of this Agcttment.
(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 tnadc for receipt on the
due date in the manner customary for the relevant obligation unless otherwise specified in the relevant
Confirmation or elscwhene in this Agreement.
(iii) Each obligation of each party under Section 2(a)(i) is subject to (1) the condition preoedeot
that no Event of Default or Potential Event of Default wtth respect to the other parry has oCCU.rred and
Copyriglrc ° 1992 by lntemuioeal Swap l~nle~s nssoc~oon, tnc.
t
NA1a370~.7
is continuing, (2) the condition precedent that no Eazly Termination Date in respect of the relevant
Transaction has occurred or been effectively designated aril (3) each other applicable condition precedent
specified in this Agreement.
(b) Change of Account Either party may change its account for receiving a payment or delivery by giving
notice to the other party at least five Local Business Days prior to the scheduled date for the payment or delivery
to which such change applies unless such other party gives timely notice of a reasonable objection to such change.
(c) Netting If on any date amounts would otherwise be payable:-
(i) in the same currency, and
(ii) in respect of the same Transaction, by each party to the other, then, on such date, each party's
obligation to make payment of any such amount will be automatically satisfied and dischazged 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 aze 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 subpazagraph (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 sepazately to each pairing of branches or offices through which the parties make and receive
payments or deliveries.
(d) Default Interest; Other Amounts. Prior to the occurrence or effective designation of an Eazly
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 2nd 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) that:-
(a) Basic Representations.
(i) Status It is duly organized and validly existing under the laws of the jurisdiction of its
organization or incorporation and, if relevant under such laws, in good standing;
(ii) Powers It has the power to execute this Agreement and any other documentation relating to
this Agreement to which it is a party, to deliver this Agreement and any other documentation relating to
this Agreement that it is required by this Agreement to deliver and to perform its obligations under this
Copyright ° 1992 by International Swap Dealers Association, Inc.
2
NA143700.6
Agreement and any obligations it has under any Credit Support Document to which it is a party and has
taken all necessary action to aiithorize such execution, delivei 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 aze in full force and effect and all conditions of any such consents have been complied with,
and
(v) Obligations Binding Its obligations under this Agreement and any Credit Support Document
to which it is a party constitute its legal, valid and binding obligations, enforceable in accordance with
their respective terms (subject to applicable bankruptcy, reorganization, insolvency, moratorium or similaz
laws affecting creditors' rights generally and subject, as to enforceability, to equitable principles of
general application (regardless of whether enforcement is sought in a proceeding in equity or at law))
(b) Absence of Certain Events No Event of Default or Potential Event of Default or, to its knowledge,
Termination Event with respect to it has occurred and is continuing and no such event or circumstance would occur
as a result of its entering into or performing its obligations under this Agreement or any Credit Support Document
to which it is a party
(c) Absence of Litigation. There is not pending or, to its knowledge, threatened against it or any of its
Affiliates any action, suit or proceeding at law or in equity or before any court, tribunal, governmental body, agency
or official or any azbitrator 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.
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 any forms, documents or certificates
specified in the Schedule or any Confirmation by the date specified in the Schedule or such Confirmation or, if none
is specified, as soon as reasonably practicable.
(b) Maintain Authorizations It will use all reasonable efforts to maintain in full force and effect all consents
of any governmental or other authority that aze 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
Copyright ° 1992 by International Swap Dealers Association, Inc.
3
NA143700.6
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(d) 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(d) or to give notice of a Termination Event) or any agreement or obligation under Section
4(a)) 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 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 eazly 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 eazly 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 similaz condition or event (however
described) in respect of such party, any Credit Support Provider of such party or any applicable Specified
Entity of such party under one or more agreements or instruments relating to Specified Indebtedness of
any of them (individually or collectively) in an aggregate amount of not less than the applicable Threshold
Copyright ° 1992 by International Swap Dealers Association, Inc.
4
NA143700.6
Amount (as specified in the Schedule) which has resulted in such Specified Indebtedness becoming, or
becoming capable at such time of being declazed, 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 similaz 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, dischazged, 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 similaz
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, dischazged,
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, and, if specified to be applicable, a Credit Event Upon Merger if the
event is specified pursuant to (ii) below or an Additional Termination Event if the event is specified pursuant to (iii)
below•-
Copyright o 1992 by International Swap Dealers Association, Inc.
5
NA143700.6
(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} -
(I) 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) 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 S(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
(iii) Additional Termination Event. If any "Additional Termination Event" is specified in the
Schedule or any Confirmation as applying, the occurrence of such event (and, in such event, the Affected
Party or Affected Parties shall be as specified for such Additional Termination Event in the Schedule or
such Confirmation)
(c) Event of Default and Illegality If an event or circumstance which would otherwise constitute or give
rise to an Event of Default also constitutes an Illegality, it will be treated as an Illegality and will not constitute an
Event of Default.
6. Early Termination
(a) Right to Terminate Following Event of Default If at any time an Event of Default with respect to a
party (the "Defaulting Party") has occurred and is then continuing, the other party (the "Non-defaulting Party") may,
by not more than 20 days' notice to the Defaulting Party specifying the relevant Event of Default, designate a day
not eazlier than the day such notice is effective as an Eazly 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 Eazly 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.
Copyright ° 1992 by International Swap Dealers Association, Inc.
6
NA143700.6
(ii) Two Affected Parties If an Illegality under Section 5(b)(i)(1) 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.
(iii) Right to Terminate. If -
(1) an agreement under Section 6(b)(ii) 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 other than that referred to in Section 6(b)(ii), a Credit Event Upon
Merger or an Additional Termination Event occurs,
either party in the case of an Illegality, any Affected Party in the case of an Additional Termination Event
if there is more than one Affected Party, or the party which is not the Affected Party in the case of a
Credit Event Upon Merger or an Additional Termination Event if there is only one Affected Party may,
by not more than 20' days notice to the other party and provided that the relevant Termination Event is
then continuing, designate a day not eazlier than the day such notice is effective as an Eazly Termination
Date in respect of all Affected Transactions.
(c) Effect of Designation.
(i) If notice designating an Eazly Termination Date is given under Section 6(a) or (b), the Eazly
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 Eazly Termination Date, no further
payments or deliveries under Section 2(a)(i) or 2(d) 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 Mazket 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 Eazly 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 Eazly 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), from (and including) the relevant Eazly 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 Eazly Termination Date occurs, the following provisions shall
apply based on the parties' election in the Schedule of a payment measure, either "Mazket Quotation" or "Loss,"
Copyright ®1992 by International Swap Dealers Association, Inc.
7
NA143700.6
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 "Mazket Quotation" or the "Second Method",
as the case may be, shall apply The amount, if any, payable in respect of an Eazly Termination Date and
determined pursuant to this Section will be subject to any Set-off
(i) Events of Default. If the Eazly Termination Date results from an Event of Default:-
(1) First Method and Market Quotation. If the First Method and Mazket Quotation
apply, the Defaulting Party will pay to the Non-defaulting Parry 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 Unpaid Amounts owing to the Non-
defaulting Party over (B) 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 Mazket Quotation
apply, an amount will be payable equal to (A) the sum of the Settlement Amount (determined
by the Non-defaulting Party) in respect of the Terminated Transactions and the Unpaid
Amounts owing to the Non-defaulting Party less (B) 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 Eazly Termination Date results from a Termination Event.-
(1) One Affected Parry If there is one Affected Party, the amount payable will be
determined in accordance with Section 6(e)(i)(3), if Mazket 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 aze being terminated, Loss shall be calculated in respect of all Terminated
Transactions.
(2) Two Affected Parties If there aze two Affected Parties.-
(A) if Mazket 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 Unpaid Amounts owing
to X less (II) 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 aze being terminated, in respect of
all Terminated Transactions) and an amount will be payable equal to one-half of the
Copyright ° 1992 by International Swap Dealers Association, Inc.
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NA143700.6
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 Eazly Termination Date occurs
because "Automatic Eazly Termination" applies in respect of a party, the amount determined under this
Section 6(e) will be subject to such adjustments as aze 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 Mazket 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.
Transfer
(a) 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:-
(i) 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 of its assets to, another entity (but
without prejudice to any other right or remedy under this Agreement), and
(ii) 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. 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 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 aze cumulative and not exclusive of any rights, powers, remedies and privileges
provided by law
Copyright o 1992 by International Swap Dealers Association, Inc.
9
NAI43700.6
(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 aze 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 aze for convenience of reference only and aze not to
affect the construction of or to be taken into consideration in interpreting this Agreement.
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, incurred by such other party by reason of the enforcement and protection
of its rights under this Agreement or any Credit Support Document to which the Defaulting Party is a party or by
reason of the eazly termination of any Transaction, including, but not limited to, costs of collection.
10. 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
Copyright ° 1992 by International Swap Dealers Association, Inc.
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NA143700.6
(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 aze to be given to it.
11 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) 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 similaz 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.
12. 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, 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.
Copyright ° 1992 by International Swap Dealers Association, Inc.
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NA143700.6
(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 aNon-defaulting Party, the Non-default Rate; and
(d) in all other cases, the Termination Rate.
"Consent" includes a consent, approval, action, authorization, exemption, notice, filing, registration or exchange
control consent.
"Credit Event Upon Merger" has the meaning specified in Section 5(b)
"Credit Support Document" means any agreement or instrument that is specified as such in this Agreement.
"Credit Support Provider" has the meaning specified in the Schedule.
"Default Rate" means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the
relevant payee (as certified by it) if it were to fund or of funding the relevant amount plus 1 % per annum.
"Defaulting Party" has the meaning specified in Section 6(a)
"Early Termination Date" means the date determined in accordance with Section 6(a) or 6(b)(iii)
"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)
"law" includes any treaty, law, rule or regulation and "lawful" and "unlawful" will be construed accordingly
"Local Business Day" means, subject to the Schedule, a day on which commercial banks aze 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, (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, 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 Eazly Termination Date and not made, except, so as to
avoid duplication, if Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does not include a party's legal fees
and out-of-pocket expenses referred to under Section 9 A party will determine its Loss as of the relevant Eazly
Copyright ° 1992 by International Swap Dealers Association, Inc.
12
NA143700.6
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 Mazket-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 Mazket-
maker to enter into a transaction (the "Replacement Transaction") that would have the effect of preserving for such
party the economic equivalent of any payment or delivery (whether the underlying obligation was absolute or
contingent and assuming the satisfaction of each applicable condition precedent) by the parties under Section 2(a)(i)
in respect of such Terminated Transaction or group of Terminated Transactions that would, but for the occurrence
of the relevant Early Termination Date, have been required after that date. For this purpose, Unpaid Amounts in
respect of the Terminated Transaction or group of Terminated Transactions are to be excluded but, without
limitation, any payment or delivery that would, but for the relevant Early Termination Date, have been required
(assuming satisfaction of each applicable condition precedent) after that Early Termination Date is to be included.
The Replacement Transaction would be subject to such documentation as such party and the Reference Mazket-
maker may, in good faith, agree. The party making the determination (or its agent) will request each Reference
Mazket-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 Eazly 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 aze provided, the Mazket Quotation will be the arithmetic mean of the quotations, without
regazd to the quotations having the highest and lowest values If exactly three such quotations are provided, the
Mazket 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 disregazded. If fewer than three quotations aze 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)
"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 mazket selected by the party determining
a Mazket 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
"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 similaz 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•-
Copyright ° 1992 by International Swap Dealers Association, Inc.
13
NA143700.6
(a) the Mazket Quotations (whether positive or negative) for each Terminated Transaction or group
of Terminated Transactions for which a Maiket 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 Mazket Quotation cannot be
determined or would not (in the reasonable belief of the party making the determination) produce a commercially
reasonable result.
"Specified Entity" has the meaning specified in the Schedule.
"Specified Indebtedness" means, subject to the Schedule, any obligation (whether present or future, contingent or
otherwise, as principal or surety or otherwise) in respect of borrowed money
"Specified Transaction" means, subject to the Schedule, (a) any transaction (including an agreement with respect
thereto) now existing or hereafter entered into between one party to this Agreement (or any Credit Support Provider
of such party or any applicable Specified Entity of such party) and the other pazty 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, forwazd 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, collaz 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.
"Terminated Transactions" means with respect to any Eazly 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
Eazly Termination" applies, immediately before that Eazly Termination Date)
"Termination Event" means an Illegality 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 Eazly 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 Eazly 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 Eazly Termination Date and which has not been so settled as at such Eazly
Termination Date, an amount equal to the fair mazket 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 Eazly 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 mazket 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 fair market values reasonably determined by both parties.
Copyright ®1992 by International Swap Dealers Association, Inc.
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NA143700.6
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.
GBDP, L.P
By•
Name:
Title:
Date:
CITY OF FORT WORTH, TEXAS
By•
Name:
Title: City Manager
Date:
Attest:
By•
Name:
Title: City Secretary
Date:
Approved as to form and legality
By• _
Name:
Title: City Attorney
Date:
Copyright ° 1992 by International Swap Dealers Association, Inc.
15
NA14371p.6
Jul 19.1996 7 55PM R&W FAX DEPT 8 No 6266 P 5/13
EXECUTION COPY
SCHEDULE
to the
MASTER AGREEMENT
dated as of July " 23. 2~6
betweea
CITY OF FORT WORTH, TEXAS ('Party A'),
a "borne-rule" city organized and operating under
a home-rule charter and the laws of the State of Texas
and
GBDP, L.P ("Party B'),
a limited partnership
organized under the
laws of the Stan of Delaware
Paint 1. Termination Prnvlsions.
(a) "Specefud Fruity" means is relation to Party A for the purpose of•
Section 5(a)(v) (Default under Specified Transaaion), Not Applicable.
Section S(a)(vi) (Cross Default), Not Applicable.
Section S(a)(vii) (Bankruptcy), Not Applicable.
Section S(b)(ii)(Crodit Event Upon Merger), Not Applicable.
and in relation to Parry B for the purpose of
Section 5(a)(v) (Default under Specified Transaction), Not applicable.
Section S(a)(vi) (Cross Default), Not applicable.
Section 5(a)(vti) (Bankruptcy), Not applicable.
Section S(b)(ii)(Credit Event Upon Merger), Not applicable.
(b) "Spac~'tod TYarrsaclwn" will have the meanuig specified in Section 12 of this Agreement.
(c) The "Crooss ,~j~1i" ptovtsions of Section S(axvi) will apply to Parry A and to Party B.
"Spec fed IrrJebta+dreess" will have the meaning specified in Section 12 of this Agreement in the case of Party
B, and in the case of Patty A shall mean any obligation (whether present or future, contingent or otherwise, as
principal or Surety or otherwise) in respect of the Bonds or any other indebtedness issued by Party A which is
payable with Pledged Revenues (as defined in the Covered Indenture).
"TltreslYold Arnartnt" means, in the case of Party B, 520,000,000 (except that in the case of the Credit Stirpport
Provider of Party B Threshold Amount shall have rho meaning set forth to clause (ii) of Annex A to Exhibit C to
this Agroerrtettt), atul in the case of Patty A, 510,000,000.
(d) The "Crtadit Event Upon Merger" provisions of Section S(b)(ii) will apply to Party A end to Party B;
provided, however, that actions taken by Party A in compliance with Section 4(h) of the Master Ordinance (as pan
of the Coveted Indenture) shall not be deemed to result in a Credit Event Upon Merger.
(e) The "Automatic Early Termination" provision of Section 6(a) will apply to Parry A acid will not apply to
Patty B.
wun~+oo.s
Failure to Notify of Bankruptcy Event. Upon the occurrence of a Bankruptcy Event (as hereinafter defined) Party
A (the "Defaulting Party") hereby agrees 'to make restitution to Party B and the Replacement Party (the "Non-
defaulting Parties") from all losses and costs arising from the failure of the Non-defaulting Parties to lift their hedges
in respect of the Transactions upon the occurrence of such Bankruptcy Event from the occurrence of such
Bankruptcy Event until such time as each of the Non-defaulting Parties learns of such event and is satisfied, in its
sole discretion, that termination resulting from such event is legally valid, provided, that each of the Non-defaulting
Parties shall use its best efforts to mitigate its losses, if any, and shall submit to the Defaulting Party a written
statement of its losses and costs (and the basis for calculating such losses and costs in reasonable detail) which
statement shall be, absent manifest error, presumed correct. "Bankruptcy Event" shall mean for purposes of Section
6(a) of the Agreement and Item (e) of Part I of the Schedule, an event set forth in Section 5(a)(vii) of the
Agreement.
(f) Payments on Early Termination. For the purpose of Section 6(e) of this Agreement:
(i) Market Quotation will apply
(ii) The First Method will apply
(g) Additional Termination Event will apply The following shall constitute an Additional
Termination Event:
Ratings Event Party B or the Replacement Party (in which case Party B shall be the Affected Party) has
one or more outstanding issues of rated unsecured, unenhanced senior debt and none of such issues has a
rating of at least (i) A3 or higher as determined by Moody's Investors Service, Inc. ("Moody's"), (ii) A-
or higher as determined by Standard & Poor's Ratings Services, A Division of the McGraw-Hill
Companies, Inc. ("S&P") or (iii) A- or higher as determined by Fitch Investors Service, Inc. ("Fitch") or
Party A (in which case Party A shall be the Affected Party), does not have at least an (i) A3 or higher as
determined by Moody's, (ii) A- or higher as determined by S&P or (iii) A- or higher as determined by
Fitch on at least one series of Parity Obligations without giving effect to any credit enhancement thereon.
(h) Events of Default.
(i) Bankruptcy. Clause (6) of Section 5(a)(vii) of this Agreement is hereby amended to read in its entirety
as follows.
"(6)(A) seeks or becomes subject to the appointment of an administrator, provisional liquidator,
conservator, receiver, trustee, custodian or other similaz official for it or for all or substantially atl its assets
or (B) in the case of a Government Entity, any Credit Support Provider of such Government Entity or any
applicable Specified Entity of such Government Entity, (I) there shall be appointed or designated with
respect to it, an entity such as an organization, board, commission, authority, agency or body to monitor,
review, oversee, recommend or declaze a financial emergency or similaz state of financial distress with
respect to it or (II) there shall be declared or introduced or proposed for consideration by it or by any
legislative or regulatory body with competent jurisdiction over it, the existence of a state of financial
emergency or similar state of financial distress in respect of it;"
(ii) Merger Without Assumption. Section 5(a)(viii) of this Agreement is hereby amended to read in its
entirety as follows.
"(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 (or, in the case
of Party A, all or substantially all of the project, program or other enterprise from which the funds
specified in Part 4(c)(iv) hereof are derived in whole or in part) to, another entity (or, without limiting the
foregoing, if such party is a Government Entity, an entity such as an organization, board, commission,
authority, agency or body succeeds to the principal functions of, or powers and duties granted to, such
NA 143700.5 2,
parry or any Credit Support Provider of such party) and, at the time of such consolidation, amalgamation,
merger, transfer or succession.
(1) the resulting, surviving, transferee or successor 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 parry) to the performance by such resulting, surviving, transferee or successor entity of its
obligations under this Agreement, or
(3) in the case of Party A, the sources of payment for the obligations of Party A as set forth
in the Schedule aze no longer available for the satisfaction of such resulting, surviving, transferee
or successor entity's obligations to the other party hereto "
(i) Termination Events. Section 5(b)(ii) of this Agreement is hereby amended to read in its entirety as follows.
"(ii) 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 (or,
in the case of Party A, all or substantially all of the project, program or other enterprise from which the
funds specified in Part 4(c)(iv) hereof aze derived in whole or in part) to, another entity (or, without
limiting the foregoing, if X is a Government Entity, an entity such as an organization, boazd, commission,
authority, agency or body succeeds to the principal functions of, or powers and duties granted to, X, any
Credit Support Provider of X or any Specified Entity of X) and such action does not constitute an event
described in Section 5(a)(viii) but the creditworthiness of the resulting, surviving, transferee or successor
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"
(j) Early Termination.
(i) The first sentence of Section 6(a) is hereby amended to read in its entirety as follows
"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") or, if Party A is the Defaulting Party, the
Replacement Party may, by not more than 20 days notice to the Defaulting Party specifying the relevant
Event of Default, designate a day not eazlier than the day such notice is effective as an Eazly Termination
Date in respect of all outstanding Transactions."
(ii) Section 6(b)(iii) is hereby amended to read in its entirety as follows
"(iii) Right to Terminate If•
(i) an agreement under Section 6(b)(ii) 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 other than that referred to in Section 6(b)(ii), a Credit Event Upon Merger or an
Additional Termination Event occurs,
NA 143700.5
either party or the Replacement Party in the case of an Illegality, any Affected Party or the Replacement
Party in the case of an Additional Termination Event if there is more than one Affected Party, or the party
which is not the Affected Party (or, if Party A is the Affected Party, the Replacement 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 patty and provided that the relevant Termination Event
is then continuing, designate a day not eazlier than the day such notice is effective as an Eazly Termination
Date in respect of all Affected Transactions."
(iii) Section 6(e)(i) is hereby amended by adding the following as a new subparagraph (5) thereof•
"(5) If there is a Defaulting Party, the obligations of the Non-defaulting Party to pay to the Defaulting
Party any amount under this Section 6(e)(i) shall not arise until, and shall be subject to the conditions
precedent that, (A) the Non-defaulting Party shall have received confirmation satisfactory to it in its sole
discretion (which may include an unqualified opinion of its counsel) that (x) all Transactions aze terminated
in accordance with Section 6(a) and (y) each Specified Transaction shall have terminated pursuant to its
specified termination date or been terminated through the exercise by a party of a right to terminate and
all amounts due under each Specified Transaction by the Defaulting Party shall have been fully and finally
paid, and (B) all obligations (contingent or absolute, matured or unmatured) of the Defaulting Pally and
any Affiliate of the Defaulting Party to make any payment to the Non-defaulting Party or any Affiliate of
the Non-defaulting Party shall have been fully and finally performed, and provided, further, that if under
the foregoing provisions it is determined that the Non-defaulting Party is to make a payment to the
Defaulting Party, there shall be deducted from the amount of such payment all amounts which the
Defaulting Party may be obligated to pay under Section 9 With respect to the foregoing clause (y), it is
expressly agreed that neither the Non-defaulting Party nor .any Affiliate of the Non-defaulting Party shall
have any obligation to exercise any right it may have to terminate a Specified Transaction prior to its
specified termination date. "
Part 2. Agreement to Deliver Documents.
For the purpose of Section 4(a) of this Agreement, each party agrees to deliver the following documents, as
applicable:
Party required to Date by which
deliver document Form/Document/Certificate to be delivered
Party B Opinion of counsel to Party B On or by the Effective
substantially in the form Exhibit B Date of the initial
Transaction.
Party B Termination and Replacement Agreement On or by the Effective
and Guazantee substantially in the form of Date of the initial
Exhibit C to this Schedule. Transaction.
Party B Opinions of counsel to the Replacement On or by the Effective
Party and GRC substantially in the forms Date of the initial
attached as Annexes C and D to Exhibit C Transaction.
to this Schedule.
Party B Written consent of the Replacement Party Prior to the execution of
to the execution of the relevant each Transaction other
Transaction. than the initial
Transaction between
Party A and Party B
entered into as of the
date hereof
Covered by
Section 3(d)
Representation
No
No
No
No
NA 143700.5
Party A Opinion of counsel to Party A
substantially in the form of Exhibit D to
this Schedule.
Party A A copy of the statutory or regulatory
authority pursuant to which Party A is
authorized to enter into this Agreement
and each Transaction.
On or by the Effective
Date of the initial
Transaction.
Prior to the execution of
this Agreement and, with
respect to each
Transaction, prior to the
execution of such
Transaction.
Party A An incumbency certificate with respect to Prior to the execution of
the signatory of this Agreement. this Agreement and, with
respect to each
Transaction, prior to the
execution of such
Transaction.
Party A A certified copy of the resolution or Prior to the execution of
resolutions (or the equivalent. thereof) of this Agreement and, with
the governing body of Party A, certified respect to each
by an appropriate official of Party A, Transaction, prior to the
pursuant to which Party A is authorized to execution of such
enter into this Agreement and each Transaction.
Transaction.
Party A A certificate from the Mayor or City Prior to the execution of
Manager of Party A to the effect that any this Agreement and, with
requirements of the statutory or regulatory respect to each
authority referred to above have been Transaction, prior to the
satisfied, specifically, a certificate of a execution of such
Designated Financial Officer as defined in Transaction.
and as required by the Covered Indenture.
Party A Audited Annual Financial Statements or Within 180 days of the
Reports and Unaudited Quarterly end of each year and
Financial Statements or Reports. within 60 days of the
end of each quarter
Party A All documents evidencing the necessary Upon the Effective Date
authorizations, determinations and of the initial Transaction.
approvals for the offering, sale and
issuance of the Bonds
Party A Reliance letters on opinions of counsel to Upon the Effective Date
Party A with respect to the validity of of the initial Transaction.
Covered Indenture.
Party A An opinion of the Attorney General of the Promptly upon the
State of Texas approving the Master
Agreement, Schedule to the Master
Agreement and the initial Transaction
entered into between Party A and Party B
as of the date hereof
execution of this
Agreement and, with
respect to each
Transaction, promptly
upon the execution of
such Transaction.
No
Yes
Yes
Yes
Yes
Yes
Yes
No
No
NA 143700.5
Jul 19.1996 7 56PM R&W FAX DEPT 8
Part 3. Miscellaneous.
No 6266 P 6/13
(a) Notices. The Replacement Parry shall be entitled to give any notice to Patty A described in Section S(a)(i)
and 5(a) (ii) with the effect set forth thenein_ For the purpose of Suction 10(a) of this Agrtemerrt:
Address for notices or communications to Party A.
Address. City of Fort Worth, Texas
1000 Throckmorton
Fort Worth, 7cxas 76102
Attention. James Keyes, 13trector of Fiscal Services
Fax No. (817) 871-8966
Telephone No. (817) 871-BS17
Address for notice or communications to Party B.
Address~ GBDP, L.P
One World Trade Center
Suite 5201
New York, New York 10048
Attentton: J Donald Rice, Jr
Fax No. 212-432-7840
Telephone No 212-032-7700
With a copy to the Calculation Agent.
(b) Calculation .4garrt. The Calculation Agent is "The Chase Manhattan Bank, unless otherwrx specified in
a Confirmation in relation to the relevant Transaction with the expr+aas written wnsent of the Replacement
Parry Address for notices yr communications to the Calculanon Agent:
' Address: "The Chase Manhattan $ank
i
450 West 33rd Street, 1Sth Ploor
New York, New York 10001
~ Attention: Corporate Trust " Admin~strahon
Fax No. 212-" 946-8567
Telephone No.. 212-" 94
(c) Credit Support D~neanunt. Details of any Credit Support bocument_ in relation to Party B, the
Termination and Replacement Agreement (the "Termination and Replacerncnt Agrtxment") by attd between
Party A, and General Re Financial Products Corporation (the "Replacement Parry") and the guarantee
thereof (the 'Guarantee") by General Re Cotporatron ("GRC"), and is relation to Party A, Noi applicable.
(d) Credit Srippor! Provider Coedit Support Provtder means in relation to Patty A, Not applicable.
Credit Support Provider tncans in relation to Party B, the Replacement Party and GRC.
(e) Governing Law. This Agreement will be governed by and construed tit aecprdance with the laws of the
State of Texas (without reference to choice of law doctrine).
NwItl7~00S 6
1ul 19.1996 7 56PM R&W FAX DEPT 8 No 6266 P 7/13
(f) Netting of Aayntents. Subparagraph (ii) of Section 2(c) o[ this Agrexmnnt will not apply co all
Transacttons
(g) "AjJf[iote"will have the meaning specified in Section 12 of this Agr+eernent.
(h) "Cot+e~ed ladeatr~re" means Ordinance No. 10968 entitled "Master Ordinance Establishing The City of
Fort Worth, Texas, Water and Sewer System Revenue Financing Program- (the "Master Ordinance") as
supplemented and amended from trine to time is accordance with its terms, including, as of the date hereof,
by the First Supplemental Ordinance, the Second Supplemental Ordinance and the Third Supplet~rttal
Ordinance {each as defined in the Pourth Supplemental Ordinance) and as further supplemented and
amended by the Fourth Supplemental Ordinance identified as Ordinance No. and entitled "Fourth
Supplemental Ordinance Authorizutg The fixecution And Delivtry Of Intertst Rate Swap Agreements Ia
Connection With The City Of Fort Worth, Texas Water And Sewer System Finance Program; Deelanng
The City's Payment Obligations Under Said Agreements As 'Parity Obligaztons' Undej The Master
Ordinance Establishtng The City Of Fort Worth, Texas Water And Sewer System Revenue Financing
System; And Ordaining Other Matters Yn Respect Thereto' (the 'Fourth Supplemental Ordinance').
(i) "Covered Indenture Ineorpomtion Date" means the daft of this Agreement.
(j) "Got+ernmurt Entity" means Party A.
(k) "Bonds"means the (i) City of Fort Worth, Texas (Tarrant and Denton Counties) Water and Sewer System
Revtnue Refunding and Improvement Bonds, Series 1996. (ii) Ciry of Fort Worth, Texas Water and Sewer
System Revenue Refunding fonds, Series 1991A and Series 1991E and (iii) City of Fort Worth, Texas
Water and Sewer System Revenue Refunding fonds, Series 1993, and any other Bonds to be isstKd under
the Covered Indenture on a Parity Obligation as defined thereto.
(1) Account details. Payments shall be made to the following accounts.
Payments t0 Party A. BankOne, 'Texas/tlrst
ABAl1 11' 10-0061-4
City of Fort Worth, Texas
ActxA~ 1180121202
Payments to Parry B. "The Chase Manhattan Bank, New York,
New York, a9 custodial agent, ABA No.
OZI-000-021 for deposit in Account No.
323-307-108.
Any other provision of this Agreement ootwtthstanding, the parties hereto shall not change the account for
payment to Party B without the prior wrinen consent of the Replacement Patty, which is a third parry
beneficiary to the agreement contained is th>s Pan 3(1).
Part 4. Other Provisions.
(a) Obligations. Section 2(a)(iii) of this Agr+eerttettt is hereby amended to read in its entirety as follows.
"(iii) Each obligation of each party under Section 2{a)(i) is subject to (1) the condition precedent that no
Event of Default, Pottntia] Event of Default or Incipient Illegality with respect to the other party has
occurred and is continuing, (2) the condition precedent that no Early Termination Date in rtspeet of the
relevant Transaction has occurred or been effectively designated and (3) each other applicable condition
prt~edwt specified in this Agreement."
(b) Repr~escntatioas.
w-u~am.s 7
(i) The introductory clause of Section 3 of this Agreement is hereby amended to read in its entirety
as follows.
"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 ease of the representations in Section
3(a) and 3(e), at all times until the termination of this Agreement) that:-"
(ii) Section 3(a)(ii) of this Agreement is hereby amended to read in its entirety as follows.
"(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 and made all necessary determinations and findings to authorize such execution,
delivery and performance;"
(iii) Section 3(b) of this Agreement is hereby amended to read in its entirety as follows.
"(b) Absence of Certain Events. No Event of Default or Potential Event of Default or, to its knowledge,
Incipient Illegality (in the case of a Government Entity) or 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
ply„
(iv) Section 3 of this Agreement is hereby amended by adding the following subsection"(e)" thereto,
which subsection shall only apply to the Government Entity
"(e) Purpose of Agreement. This Agreement has been, and each Transaction hereunder will be (and, if
applicable, has been), entered into for purposes of managing its borrowings or its financial positions,
consistent with the provisions of the Fourth Supplemental Ordinance, and not for purposes of speculation.
Not by way of limitation, Party A has entered into this Agreement specifically for the purpose of enhancing
the security for and/or to provide for the payment of principal or interest on the Bonds."
(v) Section 3 of this Agreement is hereby amended by adding the following subsection "(f)" thereto
"(f) No Reliance. In connection with the negotiation of, the entering into, and the confirming of the
execution of, this Agreement, any Credit Support Document to which it is a party, and each Transaction.
(i) the other party (or its Credit Support Provider, if any) is not acting as a fiduciary or financial or
investment advisor for it; (ii) it is not relying upon any representations (whether written or oral) of the
other party (or its Credit Support Provider, if any) other than the representations expressly set forth in this
Agreement and in such Credit Support Document; (iii) the other party (or its Credit Support Provider, if
any) has not given to it (directly or indirectly through any other person) any advice, counsel, assurance,
guazantee, or representation whatsoever as to the expected or projected success, profitability, return,
performance, result, effect, consequence, or benefit (either legal, regulatory, tax, financial, accounting,
or otherwise) of this Agreement, such Credit Support Document, or such Transaction, (iv) it has consulted
with its own legal, regulatory, tax, business, investment, financial, and accounting advisors to the extent
it has deemed necessary and it has made its own investment, hedging, and trading decisions based upon
its own judgement and upon any advice from such advisors as it has deemed necessary and not upon any
view expressed by the other party (or its Credit Support Provider, if any), (v) it has determined that the
rates, prices, or amounts and other terms of each Transaction and the indicative quotations (if any)
provided by the other party reflect those in the relevant mazket for simiiaz transactions, and all trading
decisions have been the result of arm's length negotiations between the parties, and (vi) it is entering into
this Agreement, such Credit Support Document, and such Transaction with a full understanding of all of
NA143700.5
Jul 19.1996 7 57PM R&W FAX DEPT 8 No 6266 P 8/13
the risks hereof and thereof (economic and otherwise), and it is capable of assuming and willing to assume
(financially and otherwise) those nsks."
(v;) Seaioa 3 of this Agreement is hereby amended by ceding the following subsection '(g)" thereto
which subsetxron shall apply only to the Goventment Entity
"(g) " Asssts vj Pwty A. No person, firm, corporation, entity or association other than Party A tray
liquidate, borrow, encumber or otherwise utilize the assets (including without limitationthe assets identified
in Part 4(cxiv)) of Patty A. Parry A has taken all steps necessary or advisable to create and perfect the
pledge and security interest m the assets identified in Part 4(c)(iv), and such pledge and security interest
have been validly created and perfected "
iv] Section 3 of this Aereement rs hereby ametrded by addi a the followirue subsection "(h)" thereto
which subsection shall aonly only to the Government F.ntitv:-
(c) Agrc~rents.
(i} The introductory clause of 5oction 4 of this Agreement is hereby amended to read in its entirety
as follows.
"Each party agrees with the other (or, in the case of Section 4(d) and (e), the Government Enrxry agrees
with the other party) that, so long as eithu parry has or may have nay obligation under this Agreement or
under any Credit Sbpport Docuraatt to which it is a party - "
(ii) Section 4 of this Agreement is hereby amended by adding the followtng subsections "(d)" and
"(e)" thereto:
"(d) Co-eptiarret wrtli Covc~e !„de,etunc, The Govenuacnt Ettttty will observe, perform and fulfill each
provision in the Covered Indenture applicable to such Government Entity is effect oa the Covered
Indenturt Iaoorporation Dare, as any of those pronstorLS may be amended, su~plemeatod or modified for
purposes of this Agreement with the prior written consent of the athex party hereto (the "lneatpocated
Provisions"), with the effect that such other party hereto will have the benefit of each of the Incorporated
Provisions (including without limitation, covenants. right to consent to artain actions subject to eoasco~t
under the Coveted Indenture and delivery of finarlc~al statemeatse and other notices and information). In
the event the Covered Indenture ceases to be in effect prior to the termination of this Agreement" tltc
Incorporated Provisions (other than those provisions requrrutg payments in respect of bonds, notes,
warrants or ocher similar instruments issued under the Covered Indenture) will remain in full force and
effect for purposes of this Agreement as though set forth herein until such date on which all of the
obligations of the Government Entity under this Agreement and any obligations of the Government Entity
or any Credit Support Provider of the Government F~ttiry under a Credit Support Document have been fully
satisfied. The Incorporated Provutona are hereby incorporated by reference and made a part of this
Agreement to the same extent as if such provisions were set forth herein. For purposes of thu Agreement,
the Incorporated Provisions shall be construed as though (i) elf references themin to any parry malting
loans, extensions of credit or financial accommodations therarader or ca~autnuots therefor (the
"Financings") were to the other parry hereto sad (ii) to the extent that such Incorporated Provisions are
conditioned on or relate to the existence of such Financings ar the Government I:xtdry havitlg nay
rowi~sroo.s
ittrmunitV (whether or not claimedl may be attributed to such partv or its revenues ar assets."
the risks hereof and thereof (economic and otherwise), and it is capable of assuming and willing to assume
(fmancially and otherwise) those risks."
(vi) Section 3 of this Agreement is hereby amended by adding the following subsection "(g)" thereto
which subsection shall apply only to the Government Entity•
"(g)" Assets of Party A. No person, firm, corporation, entity or association other than Party A may
liquidate, borrow, encumber or otherwise utilize the assets (including without limitation the assets identified
in Part 4(c)(iv)) of Party A. Party A has taken all steps necessary or advisable to create and perfect the
pledge and security interest in the assets identified in Part 4(c)(iv), and such pledge and security interest
have been validly created and perfected. "
(c) Agreements.
(i) The introductory clause of Section 4 of this Agreement is hereby amended to read in its entirety
as follows
"Each party agrees with the other (or, in the case of Section 4(d) and (e), the Government Entity agrees
with the other party) 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 - "
(ii) Section 4 of this Agreement is hereby amended by adding the following subsections "(d)" and
"(e)" thereto
"(d) Compliance with Covered Indenture. The Government Entity will observe, perform and fulfill each
provision in the Covered Indenture applicable to such Government Entity in effect on the Covered
Indenture Incorporation Date, as any of those provisions may be amended, supplemented or modified for
purposes of this Agreement with the prior written consent of the other party hereto (the "Incorporated
Provisions"), with the effect that such other party hereto will have the benefit of each of the Incorporated
Provisions (including without limitation, covenants, right to consent to certain actions subject to consent
under the Covered Indenture and delivery of financial statements and other notices and information) In
the event the Covered Indenture ceases to be in effect prior to the termination of this Agreement, the
Incorporated Provisions (other than those provisions requiring payments in respect of bonds, notes,
warrants or other similar instruments issued under the Covered Indenture) will remain in full force and
effect for purposes of this Agreement as though set forth herein until such date on which all of the
obligations of the Government Entity under this Agreement and any obligations of the Government Entity
or any Credit Support Provider of the Government Entity under a Credit Support Document have been fully
satisfied. The Incorporated Provisions aze hereby incorporated by reference and made a part of this
Agreement to the same extent as if such provisions were set forth herein. For purposes of this Agreement,
the Incorporated Provisions shall be construed as though (i) all references therein to any party making
loans, extensions of credit or financial accommodations thereunder or commitments therefor (the
"Financings") were to the other party hereto and (ii) to the extent that such Incorporated Provisions aze
conditioned on or relate to the existence of such Financings or the Government Entity having any
obligations in connection therewith, all references to such Financings or obligations were to the obligations
of the Government Entity under this Agreement. Any amendment, .supplement, modification or waiver
of any of the Incorporated Provisions without the prior written consent of the other party hereto shall have
no force and effect with respect to this Agreement. Any amendment, supplement or modification for which
such consent is obtained shall be part of the Incorporated Provisions for purposes of this Agreement.
(e) Notice of Incipient Illegality If an Incipient Illegality occurs, the Government Entity will, promptly
upon becoming awaze of it, notify the other party, specifying the nature of that Incipient Illegality and will
also give such other information about that Incipient Illegality as the other party may reasonably require."
NA 143700.5 9
(iii) Party B hereby consents to the execution and delivery by Party A and the Replacement Party of
the Termination and Replacement Agreement and to the termination of this Agreement in accordance with
the terms thereof upon the occurrence of the events described therein and hereby agrees to provide any
notices it is requested to provide pursuant to Section 2(a) of the Termination and Replacement Agreement.
(iv) Section 4 of this Agreement is hereby amended by adding the following subsection "(f)" thereto -
"(f) Source of Payments. This Agreement shall constitute a "Parity Obligation" as such term is defined
in Exhibit A to the Master Ordinance and as such all amounts payable to Party B by Party A pursuant to
this Agreement shall be payable on a pazity with the Bonds and the other Parity Obligations in accordance
with the terms of the Fourth Supplemental Ordinance. Amounts payable by Party A hereunder shall be
payable solely from Pledged Revenues as provided in the Covered Indenture and as such term is so defined
in the Covered Indenture."
(d) Transfer Section 7 of this Agreement is hereby amended to read in its entirety as follows.
"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),
(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), or
(c) Party B may pledge this Agreement to the Replacement Party
Any purported transfer that is not in compliance with this Section will be void."
(e) Jurisdiction and Immunity Sections 11(b) and 11(c) of this Agreement aze hereby deleted in their entirety
from this Agreement.
(f) Definitions Section 12 of this Agreement is hereby amended to add the following definitions in their
appropriate alphabetical order
"`Bonds' has the meaning specified in the Schedule."
"`Covered Indenture' has the meaning specified in the Schedule. "
"`Covered Indenture Incorporation Date' has the meaning specified in the Schedule."
"`Government Entity' has the meaning specified in the Schedule."
"`Incipient Illegality' means (a) the enactment by any legislative body with competent jurisdiction over
the Government Entity of legislation which, if adopted as law, would render unlawful (i) the
performance by such Government Entity of any absolute or contingent obligation to make a payment
or delivery or to receive a payment or delivery in respect of a Transaction or the compliance by such
Government Entity with any other material provision of this Agreement relating to such Transaction
or (ii) the performance by the Government Entity or a Credit Support Provider of such Government
Entity of any contingent or other obligation which the Government Entity (or such Credit Support
Provider) has under any Credit Support Document relating to such Transaction, (b) any assertion in
any proceeding, forum or action by the Government Entity, in respect of such Government Entity or
NA 143700.5 1 Q
in respect of any entity located or organized under the laws of the state in which such Government
Entity is located to the effect that performance under this Agreement or similar agreements is unlawful
or (c) the occurrence with respect to the Government Entity or any Credit Support Provider of such
Government Entity of any event that constitutes an Illegality "
(g) Consent to Amendments Any other provision of this Agreement notwithstanding, the parties hereto shall
not amend this Agreement, including this Schedule and any Confirmation, without the prior written consent
of the Replacement Party, which is a third party beneficiary of the agreement contained in this Part 4(g)
NA143700.5 11
The parties executing this Schedule have executed the Master Agreement and have agreed as to the contents
of this Schedule.
CITY OF FORT WORTH, TEXAS
By•
Name:
Title: City Manaeer
Date:
Attest.
By•
Name:
Title: City Secretary
Date:
Approved as to form and legality•
By•
Name:
Title: City Attorney
Date:
GBDP, L.P
By GBDP Corporation
By
Name:
Title:
Date:
EXHIBIT A
[Form of Confirmation]
[Note: This is a sample confirmation only
Actual Confirmation may change substantially ]
[LETTERHEAD OF GBDP, L.P]
199
Party A
[Address]
Deaz Sirs
The purpose of this letter agreement is to confirm the terms and conditions of the transaction (the
"Transaction") entered into between GBDP, L.P ("Party B") and ("Party A")
on the Trade Date specified below This letter agreement constitutes a "Confirmation" as referred to in the Master
Agreement specified below The Transaction relates to the Bonds,
Series issued on _ _ ,19_ in the original aggregate principal amount of $
(the "Bonds")
The defmitions and provisions contained in the 1992 ISDA U.S Municipal Counterparty Definitions (as
published by the International Swap Dealers Association, Inc.) aze incorporated into this Confirmation. In the event
of any inconsistency between those definitions and provisions of this Confirmation, this Confirmation will govern.
1 This Confirmation supplements, forms part of, and is subject to, the Master Agreement dated as of
199_, as amended and supplemented from time to time (the "Agreement"), between Party A and Party
B. All provisions contained in the Agreement govern this Confirmation except as specifically modified below
2 The terms of the particulaz transaction to which this Confirmation relates aze as follows.
Notional Amount.
Trade Date.
Effective Date:
199
199
Termination Date: ,
Fixed Amounts
Fixed Rate Payer• Party B
Fixed Rate Payer Payment Dates Each and ,commencing ,
199 ,with the final Payment Date being 199_,
subject to adjustment in accordance with the Following Business Day
Convention.
EXHIBIT A
Page 1
NA 14370D.5
Fixed Rate Payer Period End Dates Each and ,commencing ,199_ No
Adjustment shall apply to Period End Dates.
Fixed Rate: As set forth in Schedule I.
Fixed Rate Day Count Fraction. 30/360
Floating Amounts.
Floating Rate Payer• Party A
Floating Rate Payer Payment Dates: Each and ,commencing ,
199_, with the fmal Payment Date being _, 199 ,subject
to adjustment in accordance with the Following Business Day
Convention.
Floating Rate Payer Period End Dates. Each and ,commencing 199_
No Adjustment shall apply to Period End Dates.
Floating Rate Option.
Floating Rate Day Count Fraction. Actual/365
Method of Calculation. Weighted Average
Reset Dates. Each Thursday on and after the Effective Date (and, if the Effective
Date is a day other than a Thursday, the Thursday next preceding the
Effective Date) or, if any Thursday is not a Business Day, the first
succeeding Business Day For purposes of this provision, "Business
Day" means any day other than a Saturday, a Sunday, a day on
which commercial banks in New York City are required to be closed
or a day on which the New York Stock Exchange is closed.
3 Credit Support Document: For purposes of this Confirmation, the Termination and Replacement
Agreement and Guazantee, a form of which is attached as Appendix C to the Agreement, shall constitute a Credit
Support Document for Party B Upon the occurrence of the events specified in Section 2(a) of the Termination and
Replacement Agreement, then notwithstanding any other provision of this Confirmation or of the Agreement
(including but not limited to Section 6(a) and (b) thereof), the Termination and Replacement Agreement and
Guarantee shall become effective, this Confirmation and the Agreement shall be terminated and a new confirmation
and agreement, which shall be self-executing, shall be entered into in accordance with the Termination and
Replacement Agreement and Guazantee. In the event this Confirmation and the Agreement are terminated and aze
so replaced in accordance with the Termination and Replacement Agreement and Guarantee, then notwithstanding
any other provision of the Agreement, no Settlement Amount will be paid with respect to such termination.
4 [Party A will cause the Paying Agent of the Bonds to pay directly to Party B any monies due hereunder
from appropriate sources for such payment on or before each payment date via federal funds wire.]
5 Payment Instructions. As are set forth in the Agreement
EXHIBIT A
Page 2
NA~43700.5
Please confirm that the foregoing correctly sets forth the terms of our agreement by executing both copies of
this Confirmation enclosed for that purpose and returning one copy to us (initially by facsimile, to be followed by
delivery of the original)
By
Confirmed as of the date first above written
CITY OF FORT WORTH, TEXAS
Name:
Title: City Manager
By
Attest.
By _
Name:
Title: City Secretary
Approved as to form and legality
Name:
Title: City Attorney
Name:
Title:
Yours sincerely,
GBDP, LP
By• GBDP Corporation
By•
EXHIBIT A
Page 3
NA143700.5
SCHEDULE I
From To But Excluding Fixed Rate
EXHIBIT A
Page 4
NA 14370b.5
EXHIBIT B
[Form of Opinion of Counsel for
GBDP, L.P ]
[Date]
Party A
[Address]
Attention.
Gentlemen.
We have acted as counsel to GBDP, L.P , a Delawaze limited partnership ("Party B"), and aze familiaz
with matters pertaining to the execution and delivery of the Master Agreement (the "Master Agreement") dated as
_of 199_ between Party B and ("Party A") The Master
Agreement is to be supplemented by confirmations of transactions to be entered into by Party A and Party B from
time to time (each a "Confirmation") and the Master Agreement together with all such Confirmations shall constitute
one agreement.
In connection with this opinion, we have examined an execution copy of the Master Agreement and the
form of Confirmation attached thereto, the limited partnership agreement of Party B and the certificate of limited
partnership of Party B, certificates of public officials and such other documents as we have deemed necessary or
appropriate for the purposes of this opinion. In such opinion, we have assumed the genuineness of all the
signatures, the authenticity of all documents submitted to us as originals and the conformity to authentic original
documents of all documents submitted to us as certified, conformed or photostatic copies
Based upon the foregoing, we aze of the opinion that.
1 Party B has full power and authority to execute and deliver the Master Agreement, and each
Confirmation, and to perform its obligations thereunder
2 Party B has duly authorized the execution, delivery and performance of the Master Agreement, and
each Confirmation and all actions necessary and appropriate to carry out the same.
3 The Master Agreement, has been duly executed and delivered and constitutes, and with respect to
each Confirmation, upon due execution and delivery by Party B, will constitute, a legally valid and binding
obligation, enforceable against Party B in accordance with its terms (subject to applicable bankruptcy,
reorganization, insolvency, moratorium or similaz laws affecting creditors' rights generally and subject, as to
enforceability, to equitable principles of general application (regazdless of whether enforcement is sought in a
proceeding in equity or at law))
EXHIBIT B
Page 1
NA 143700.5
4 The execution and delivery of the Master Agreement, and each Confirmation and the performance
by Party B of its obligations thereunder do not violate, conflict with, or result in a breach of or constitute a default
under, the limited partnership agreement of Party B.
5 To the best of our knowledge no consent, authorization, license or approval of or registration or
declazation with, any United States of America federal or New York governmental authority is required in
connection with the execution, delivery and performance of the Master Agreement and each Confirmation, by Party
B.
The opinions expressed herein aze limited to matters concerning the federal laws of the United States of
America, the laws of the State of New York and the Revised Uniform Limited Partnership Act of the State of
Delaware.
Very truly yours,
EXHIBIT B
Page 2
NA143700.5
Jul 19.1996 7 57PM R&W FAX DEPT 8 No 6266 P 9/13
EXHIgiT C
TERMINATION AND REPLACEMENT AGRE)rMI?NT dazed as of July " 23 , 1996 ("Termination and
Replacement Agteerrtent'), by and between CITY OF FORT WORTH, TEXAS (the 'Counterparry'), a 'hoau-tole'
city organized and operating under ahome-rule charter and the laws of the State of Texas, and GENERAL RE
FWANCIAL PRODUCTS CORPORATION ('the Replacement Parry'), a corporation organized and existing under
the laws of Delaware.
WITNESSETH.
WHERFsAS, GBDP, L.P (the "Provider') and the Cotutterparty have entered into or will enter into one
or more Confirmations of Transactions (each, 'Conf'irmation"), forming a parr of the Master Agttcmtnt dated as
of July " 23, 1996, as such Agreement may be aznwded from ume to tttnc (the "Agreement');
WHEREAS, the Provider has agreed that upon the occurrence of ao Event of Defautt or Termination
Event (each as defined in the Agreement) by the Provider or the Counterparty, each Confirmation and the
Agreemett will automatically terminaze and be replaced by self-executing confirmations sad a master agreement
confurmng identical provisions as are then in effect to die Confirmations and Agt~eement; and
WHEREAS, each of the Provider, the Counterparty and the Replacement Party has received good and
valuable consideration to exchange for the Countetparty and the RepIaoettrent Party entering into this Agreerent.
NOW, THEREFORE, in cottsidcratton of the premises and of the mutual agreements herein contained,
the parties hereto agree as follows:
1 Defmiuotts. Terms used herein and not defined herein shall have the meaning assigned to them in
the Agreement.
2. Termination and Replacement.
(a) Upon the occurrence of (i) an Event of Default or Termination Event under the Agreement with
the Provider as Defaulting Patty or as the Sole Affected Party or (ii) an event of default under any
agreement between the Provider and the Replat:etneat Parry, and the delivery of written potitx thereof by
the Countetparty co the Rcplacemettt Patty or by the Replacement Party to the Couttterparry, the
Agreement shall terminate with each patty's rights, duties and obligazions as provided tltercttnder
bec'omiag null and void (the "'Cetrnination"); rop vidcd, howtvtr, that ehe Ternination shall not ot~rr
without an t~CCOtttpaoyitlg Replacement (as dCfitud below), as provided in Saxion 2(b) hereof. For
purposes of clause (ii) of the immediately pcecediag sentence the Provider and the Replacement parry
covenant to give Counterparry ttotice of any such defaults. Prior to the Termination, the Counterparty
shall aooept performance by the Provider of all of its duties and obligations under the Agreement. The
Replaeetttent party shall provide notice to the Provider promptly following a Termination a9 t0 the
ocwrrence of such event.
(b) Upon the Termination of the Agreement as provided in Section 2(a), the Replaceaent Party and
the Cou»teryarry shall for all purposes thereof be treated as if they had entered into a replacement
agreement (the 'Replacement Agreement") containing identical terms and conditions to those set forth in
the Agreement, the terms of which are herein incorporated by reference (the "Replacement"), except that
all references therein to the Provider shall be deerrted to be references to the Replaoeptent Party, and
subject only to those further changes to the Replacement Agreement as are set forth in Atutex A hereto.
EXH®IT C
Page 1
NwlayRb.S
The Replacement Party shall be obligated to pay to the Counterparty under the Replacement Agreement
all unpaid obligations of the Provider provided in the Agreement. The Counterparty shall be obligated
to pay to the Replacement party under the Replacement Agreement all unpaid obligations of the
Counterparty provided in the Agreement.
(c) Upon the occurrence of the Replacement, (i) each of the Provider and the Counterparty shall
each be fully released from all of its duties and obligations to the other under the Agreement as provided
for thereunder; and (ii) no event the occurrence or failure of occurrence of which would constitute an
Event of Default by the Provider or a Termination Event under the Agreement at the time of the
Termination shall constitute an Event of Default by the Replacement Party or a Termination Event
following the Replacement unless such event would be an Event of Default or Termination Event under
the Replacement Agreement and the Replacement Parry shall have failed to cure such potential Event of
Default or Termination Event upon reasonable notice from the Counterparty Each of the Replacement
Party and the Counterparty shall have all rights in respect of such Replacement Agreement, as if the
Replacement Party and Counterparty had entered into the Agreement directly as of the date of original
execution, without regazd for such intervening Termination and Replacement.
(d) The Counterparty shall give to the Replacement Party notice of the occurrence of any Event
of Default by the Provider or the Counterparty or Termination Event under the Agreement, or any event
which with notice or the passage of time would constitute an Event of Default or Termination Event
thereunder, and shall advise the Replacement Party of any action it has taken or proposes to take as a
consequence of any such Event of Default or Termination Event or any event which with notice or the
passage of time would constitute an Event of Default or Termination Event.
(e) The Counterparty and the Replacement Party shall take all such further actions and execute,
acknowledge and deliver such further instruments as may be reasonably required to carry out this
Termination and Replacement Agreement.
3 Guarantee. The obligations of the Replacement Party as provided by this Termination and
Replacement Agreement aze guazanteed by General Re Corporation pursuant to a guazantee substantially in the form
of Annex B hereto
4 Representation and Agreement. Each party to this Termination and Replacement Agreement hereby
represents and warrants to each other party that the execution, delivery and performance hereof by it aze within its
corporate or municipal powers, as the case may be, and have been duly authorized by all necessary corporate or
other action and that this Termination and Replacement Agreement constitutes its legal, valid and binding obligation.
5 Adequate Consideration. The Replacement Party and the Counterparty hereby acknowledge that the
entering into of this Termination and Replacement Agreement constitutes good and valuable consideration for each
of the parties' obligations hereunder and that upon entering into this Termination and Replacement Agreement each
of the Replacement Party and the Counterpariy shall have received all the consideration for which it had bazgained.
6 Governing Law This Termination and Replacement Agreement shall be governed by and construed
in accordance with the laws of the State of New York without regazd to principles of conflicts of laws.
7 Counterparts. This Termination and Replacement Agreement .may be executed in any number of
counterparts, each of which shall be deemed an original.
8 Waiver of Defense. The Replacement Party and the Counterparty each waives any defense or claim
it may have concerning the legality of this Termination and Replacement Agreement and agrees that the validity of
this Termination and Replacement Agreement will not be affected by (i) any insolvency, bankruptcy, liquidation,
reorganization, dissolution, winding up or other similaz proceeding involving or affecting the Replacement Party
or the Counterparty; (ii) any change in the identity or structure of the Replacement Party or the Counterparty, or
EXHIBIT C
Page 2
NA 143700.5
(iii) any other circumstance which might otherwise constitute a defense available to the Replacement Party or the
Counterparty in respect of this Termination and Replacement Agreement.
9 Sole Remedv Notwithstanding any provision in the Agreement to the contrary, upon the termination
of the Agreement pursuant to Section 2(a) hereof, this Termination and Replacement Agreement provides the sole
remedy available to the Counterparty for any Event of Default or Termination Event occurring under the Agreement.
10 Notices Any notice or communication in respect of this Termination and Replacement Agreement
will be sufficiently given to a party if in writing and delivered in person, sent by certified or registered air mail or
the equivalent (with return receipt requested) or by overnight courier at the address specified on the signature pages
hereof, or at such other address as shall be notified to the parties.
11 Changes .in the Agreement. Upon the occurrence of the Replacement, the changes set forth in Annex
A hereto are authorized to be made, and such changes shall be deemed to be self-executing, in the Schedule to the
Agreement as between the Replacement Party and the Counterparty
12. Amendments to Agreement. Amendments, modifications, waivers or termination of the Agreement
other than pursuant to the terms thereof shall not be effective without the written consent of the Replacement Party
13 Consent to each Confirmation. Notwithstanding anything to the contrary herein, and except for the
initial Confirmation entered into between the Provider and the Counterparty pursuant to the Agreement, this
Termination and Replacement Agreement shall extend only to the initial Confirmation and to Confirmations executed
from time to time pursuant to the Agreement for which the written consent to the execution of such Confirmation
of the Replacement Party has been obtained.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
EXHIBIT C
Page 3
NA143700.5
IN WITNESS WHEREOF,.the parties hereto have executed this Termination and Replacement Agreement
as of the date first above written.
GENERAL RE FINANCIAL PRODUCTS CORPORATION
By•
Name:
Title:
General Re Financial Products Corporation
630 Fifth Avenue
Suite 450
New York, New York 10121
Attention. Head of Operations
CITY OF FORT WORTH, TEXAS
By
Name:
Title: City Manager
Attest:
By•
Name:
Title: City Secretary
Approved as to form and legality
By
Name:
Title: City Attorney
EXHIBIT C
Page 4
NAI43700.5
Annex A
(i) In paragraph (d) of Part 3, the Credit Support Provider shall be changed to General Re Corporation in relation
to the Replacement Party
(ii) In paragraph (c) of Part 1, the Threshold Amount shall mean two percent (2 %) of the Stockholders' Equity in
General Re Corporation ("GRC"), in the case of the Replacement Party and GRC "Stockholders' Equity"
means with respect to GRC, at any time, the sum at such time of (i) its capital stock (including preferred stock)
outstanding, taken at par value, (ii) its capital surplus and (iii) its retained earnings, minus (iv) treasury stock,
each to be determined in accordance with generally accepted accounting principles.
(iii) In paragraph (a) of Part 3, the address for the Replacement Party is as follows.
Address. General Re Financial Products Corporation
630 Fifth Avenue
Suite 450
New York, New York 10121
Attention. Head of Operations
Telephone No (212) 307-2370
Facsimile No (212) 307-2349
With a
copy to General Re Corporation
695 East Main Street
Stamford, CT 06904
Attention. Law Department
Telephone No (203) 328-5505
Facsimile No (203) 328-6390
EXHIBIT C
Page 5
NA143700.5
Jul 19.1996 7 58PM R&W FAX DEPT 8
Annex B
[I..ettcrltead of
General Re Corporation)
GUARANTEE
No. 6266 P 10/13
Guarantee, dated as of ]uly ^ 23, 1996 by General Re COrporattott, a Delaware wrporation with iu principal place
of business at 695 East Main Street, Stamford, Connecticut 06904 (the "Guazantor"), in favor of
(the "Couaterparry')
1 Guarantee. To induce Countetparty to enter into the Termination and Replacement Agreeatertt
bearing tht above date (the "Agreement`) with the Guarantor's whoAy owned subsidiary. Genera[ Re Financial
Products Corporation ("GRFPC"), the Guarantor tmconditionally gttatarttees to the Counterpatty, its successors and
permitted asstgns, the prompt payment of all amounu due and payable by GRFPC under the Agt+xment and the
Replacement Agreement described therein, whether due or to become due, secured or unsecured, absolute or
contingent, joint or several (the 'Obligations"). Each capitalized term not defined herein has the meaning assigned
in the Agreement.
2. Nature of Guarantee. This Guarantee is a guazantoe of paytrtent and not of collection. The Counterpany shall
not be obligated, as a condition pretxdent to performance hereunder, ro file any claim relating to the Obligations
owing tv it if GRFPC becotneS Subject to a bankruptcy, reorganisation, or sitttilaz proceeding, and the failure of
the Countetpazty to file a claim shall not affect the Guarantor's Obligations hereunder If any paymectt to the
Counterpatry on account of any Obligation must be returned for any reason whatsoever, the Guarantor shall remain
liable hereunder for Stich Obligatton as if such payment had not been made. The Guarantor reserves the right to
assert defenses to paytnem of any Obligation that GRFPC may have other than defenses arising from the bankxttptcy
or insolvency Of GRFPC artd other defenses expressly waived hereby
3 Consents. Waivers and Renewals. The Guarantor agrees that the Couotexparty may at any time and from
time to time, either before or after the maturity thereof, without notice to or further consent of the Guarantor, extend
the tune of payment of or trnew any of the Obligations owing to it, and tray also make any agreement with GRFPC
or wtth any other patty to Use Agreement or person liable on any Obltguion, or interested therein, for the extension,
renewal, paytnmt, compromise, discharge or release thereof, in whole or in part, or for any modification of the
terms thtrtof or of any agrtecnent between the Cotmtetparty and GRFPC or any such other party or person, without
impairing or affecting this Guazantee. The Guarantor agrces that the Councerparty may resort to the Guarantor for
payment of any of the Obligations, whether or not the Counierparry has proceeded agautst air other obligor
principally or secondarily obligated for any Obligation. The Guarantor waives all notices that may be required by
law except notice to the Guarantor of GRFPC's default under the Agr+eement_
4 Subrottation. Upon payment of all Obliguiotu owing to the Counterparty, the Guarantor shall be subrogated
to the righu of the Counterparry against GRFPC, and the Counttxparry agrees to take at the Guarantor's expense
such steps as the Guarantor may reasonably request to implement such subrogation.
5 Guarantor's Ri¢ht to Curc. Notwithstanding anything to the contrary herein or in the Agreement, the
Guarantor shall have no liability hecetutder for GRFPC's fai[tue to pay unless, as a wttdition prxedent. the
Courtterpatty shall have given notice to the Guarantor of such failure to pay (which notice may be givers at the same
time that the Councerparty gives co GRFPC the notict of failure to pay as regtturod by Section 5(a)(i) of the
Replacement Agreement) and such failure to pay has not been remedied by the Guarantor or by GRFPC on or before
the thud Business bay after notice of such failure to prey is gtven to the Guarantor
EXHIBI"f C
Page 6
w-unms
6 Expenses. The Guazantor agrees to pay all out-of-pocket expenses (including reasonable fees and expenses
of counsel) incurred in the enforcement or protection of the rights of the Counterparty hereunder but only (i) to the
extent they are incurred after demand under the Guazantee has been made and not timely honored and (ii) if the
Counterparty is the prevailing party
7 Consent to Jurisdiction. The Guarantor hereby submits 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,
New York.
8 Necessary Action. All necessary corporate action has been duly taken by the Guarantor to authorize
execution of this Guarantee.
9 Notices Any notice or communication required or permitted hereunder shall be in the same manner
and with the same effect as set forth in the Replacement Agreement to the address specified below, if to the
Guarantor
General Re Corporation
Attn. Legal Department
Financial Centre
695 East Main Street
Stamford, CT 06904
Telephone: 203-328-5000 Facsimile: 203-328-6390
10 Governing Law This Guazantee shall be governed by and construed in accordance with the law of the
State of New York without reference to choice of law
11 Integration. This Guazantee shall supersede any prior or contemporaneous representations, statements or
agreements, oral or written, with regazd to this subject matter It may be varied only by written amendment signed
by the Guazantor
12 Termination. This Guarantee may be revoked by Guarantor by means of notice given to the Counterparty
effective upon receipt of such notice by the Counterparty or at any later date as may be specified in such notice;
provided, however, that such revocation shall not limit or terminate this Guazantee in respect of any Transaction
under the Agreement which shall have been entered into prior to notice of such revocation.
This instrument is executed as of the day and year first written above.
Attest:
GENERAL RE CORPORATION
By
By
Title:
Title:
EXHIBIT C
Page 7
NA 143700.5
Annex C
[Form of Opinion of Counsel of Replacement Party]
[Date]
IP~Y A]
[Address]
Deaz Sirs.
I am the [Assistant General Counsel] of General Re Financial Products Corporation ("GRFPC") I am
delivering this opinion in connection with that Termination and Replacement Agreement, dated as of ,
199_ (the "Agreement"), entered into between GRFPC and
I have examined or caused to be examined originals or copies, certified or otherwise satisfactorily identified,
of such documents, corporate records, certificates of public officials and other instruments and have conducted or
caused to be conducted such other investigations of fact and law as I have deemed necessary or appropriate for
purposes of this opinion. I have relied as to certain matters on information obtained from public officials, officers
of GRFPC and other sources believed by me to be responsible and I have assumed that the signatures on all
documents examined by me are genuine, assumptions which I have not independently verified. I have also assumed
that the Agreement has been duly executed and delivered by you pursuant to appropriate corporate authority The
opinions given below aze limited to matters concerning the laws of the United States of America and the State of
New York and the General Corporation Law of the State of Delaware.
Upon the basis of the foregoing, I am of the opinion that:
1 GRFPC is duly organized, validly existing and in good standing under the laws of the State of Delaware.
2. GRFPC has the requisite corporate power and authority to enter into the Agreement and to perform its
obligations thereunder; the Agreement has been duly authorized, executed and delivered by GRFPC.
3 GRFPC is not required to obtain any authorization, consent, approval, exemption or license from, or to file any
registration with, any governmental authority of the United States of America, the State of New York, or the
State of Delawaze as a condition to the validity of, or for the execution and delivery of, the Agreement or to
the performance by GRFPC of its obligations under the Agreement.
4 To my knowledge after due inquiry, there is no action, suitor proceeding pending or threatened against GRFPC
before any court or azbitrator or any governmental body, agency or official in which there is a reasonable
possibility of an adverse decision which could affect, in a materially adverse manner, the ability of GRFPC to
perform any of its obligations under the Agreement, or which in any manner questions the validity of the
Agreement.
5 The execution and delivery of the Agreement by GRFPC has not contravened or constituted a default under,
and performance of the Agreement by GRFPC will not contravene or constitute a default under, any statute,
regulation or rule of any governmental authority, under any provision of GRFPC's certificate of incorporation
or by-laws, or to.my knowledge, under any mortgage, indenture contract or other undertaking either to which
GRFPC is a party or by which GRFPC or any of its property or assets is bound.
EXHIBIT C
Page 8
NA 143700.5
6 The Agreement constitutes the legal, valid and binding obligation of GRFPC enforceable in accordance with all
its terms and conditions (subject to the effect of any applicable bankruptcy, insolvency, reorganization,
moratorium or similaz law affecting creditors' rights generally) The enforceability of GRFPC's obligations is
also subject to the effect of general principles of equity (regazdless of whether such enforceability is considered
in a proceeding in equity or at law)
The opinions herein aze expressed as of the date hereof with no duty on the part of the undersigned to inform
the addressee of any subsequent change in fact or law, or both, which would affect the accuracy of any such
opinion. These opinions are solely for your benefit and may not be relied upon in any manner or for any purpose
by any other person without my consent.
Very truly yours,
EXHIBIT C
Page 9
NA143700.5
Annex D
[Form of Opinion of Counsel of General Re Corporation]
[Date]
[PAY A]
[Address]
Deaz Sirs.
I am the Assistant General Counsel of General Re Corporation. I am delivering this opinion in connection with
the Guazantee (the "Guarantee") by General Re Corporation (the "Guarantor") of the obligations of General Re
Financial Products Corporation ("GRFPC") under that Termination and Replacement Agreement, dated as of
199_ (the "Agreement"), entered into between GRFPC and
I have examined or caused to be examined originals or copies, certified or otherwise satisfactorily identified,
of such documents, corporate records, certificates of public officials and other instruments and have conducted or
caused to be conducted such other investigations of fact and law as I have deemed necessary or appropriate for
purposes of this opinion. I have relied as to certain matters on information obtained from public officials, officers
of the Guazantor and other sources believed by me to be responsible and I have assumed that the signatures on all
documents examined by me aze genuine, assumptions which I have not independently verified. I have also assumed
that the Agreement has been duly executed and delivered by you pursuant to appropriate corporate authority The
opinions given below are limited to matters concerning the laws of the United States of America and the State of
New York and the General Corporation Law of the State of Delawaze.
Upon the basis of the foregoing, I am of the opinion that:
1 The Guarantor is duly organized, validly existing and in good standing under the laws of the State of Delawaze.
2 The Guarantor -has the requisite corporate power and authority to issue the Guarantee and to perform its
obligations thereunder; the Guazantee has been duly authorized, executed and delivered by the Guazantor
3 The Guazantor is not required to obtain any authorization, consent, approval, exemption or license from, or to
file any registration with, any government authority of the United States of America, the State of New York,
or the State of Delawaze as a condition to the validity of, or for the execution and delivery of, the Guazantee,
or to the performance by the Guazantor of it obligations under the Guazantee.
4 The execution and delivery of the Guazantee by the Guazantor has not contravened or constituted a default
under, and performance of the Guazantee by the Guazantor will not contravene or constitute a default under,
any statute, regulation or rule of any governmental authority, under any provision of the Guazantor's certificate
of incorporation or by-laws, or to my knowledge, under any mortgage, indenture contract or other undertaking
either to which GRFPC is a party or by which the guazantor or any of its property is bound.
5 The guazantee constitutes the legal, valid and binding obligation of the guazantor enforceable in accordance with
all its terms and conditions (subject to the effect of any applicable bankruptcy, insolvency, reorganization,
moratorium or similaz law affecting creditors' rights generally) The enforceability of the Guazantor's
EXHIBIT C
Page 10
NA 143700.5
obligations is also subject to the effect of general principles of equity (regazdless of whether such enforceability
is considered in a proceeding in equity or at law)
The opinions herein aze expressed as of the date hereof with no duty on the party of the undersigned to inform
the addressee of any subsequent change in fact or law, or both, which would affect the accuracy of any such
opinion. These opinions are solely for your benefit and may not be relied upon in any manner or for any purpose
by any other person without my consent.
Very truly yours,
EXHIBIT C
Page 11
NA 143700.5
EXHIBIT D
[Form of Opinion of Counsel for
Party A]
[Date]
GBDP, L.P
One World Trade Center
Suite 1535A
New York, New York 10048
General Re Financial Products Corporation
630 Fifth Avenue
Suite 450
New York, New York 10111
General Re Corporation
695 East Main Street
Stamford, Connecticut 06904
Gentlemen.
We have acted as counsel to the , an of
the State of ("Party A"), in connection with the execution and delivery of the Master Agreement (the
"Master Agreement") dated as of 199_ between Party A and GBDP, L.P ("Party B") and the
Termination and Replacement Agreement (the "Termination and Replacement Agreement") dated as of
199_ between Party A and General Re Financial Products Corporation ("GRFPC") The Master
Agreement is to be supplemented by confirmations of Transactions to be entered into by Party A and Party B from
time to time (each a "Confirmation")and the Master Agreement together with all such Confirmations shall constitute
one agreement.
In connection with this opinion, we have examined an executed copy of the Master Agreement and
the form of Confirmation attached thereto, an executed copy of the Termination and Replacement Agreement and
such documents and records of Party A, certificates of public officials and officers of Party A and such other
documents as we have deemed necessary or appropriate for the purposes of this opinion. In such opinion, we have
assumed the genuineness of all the signatures, the authenticity of all documents submitted to us as originals and the
conformity to authentic original documents of all documents submitted to us as certified, conformed or photostatic
copies
Based upon the foregoing, we aze of the opinion that:
1 Party A is a
existing under the laws of the State of
of the State of ,duly organized and validly
2. Party A is authorized under [specify statutory and/or regulatory authority] to enter into the
Master Agreement and the Termination and Replacement„Agreement and to perform its obligations under each such
document and under the Confirmation entered into pursuant to and which form a part of the Master Agreement.
EXHIBIT D
Page 1
NA143700.5
Jul 19.1996 7 59PM R&W FAX DEPT 8
No 6266 P 11/13
3. Parry A has taken all accessary aCUOn rtiqutred to be taken to assure that the Master
Agreement, the Termination and Replacement Agreement and the Confirmation entered into pursuant to and which
form a part of the Master Agreement wmply in all respects wtth [specify statutory and/or r+Cgulatory authority)
' .i
4 The Master Agreettrent and the Termination and Replaeemmt Agt+eement have each been duly
executed aad delivered by Patty A and each constitutes, and each Confirmation, upon due execution and delivery
by Party A, will constitute, a legally valid and binding obligation of Party A enforceable against parry A in
accordance with its terms (subject to applicable bankruptcy, rcorganizacioa, insolveaey, moratorium or similar laws
affectsttg creditors' rights generally and subject, as to enfortxabiIity, to equitable principles of general applicatron
(regardless of whether enforxmcnt is sought in a proceeding in equity or at law)).
5 To the best of our knowledge, no consent, authorization, license or approval of, or registration
or declaration with, any goveriinuiital authority is required in connection with the execution, delivery and
performance of the Master Agteeement, the Termination and Replaceineat Agreement and each Confumation by
Parry A_
Very truly yours,
F~1BIT b
Page 2
NA IU700.3
THE STATE OF TEXAS
COUNTIES OF TARRANT AND DENTON
CITY OF FORT WORTH
I, Alice Church, City Secretary of the City of Fort Worth, in the State of Texas, do hereby
certify that I have compared the attached and foregoing excerpt from the minutes of the regular,
open, public meeting of the City Council of the City of Fort Worth, Texas held on July 23, 1996, and
of Ordinance No ~~~%
which was duly passed at said meeting, and that said copy is a true and correct copy of said excerpt
and the whole of said ordinance. In testimony whereof, I have set my hand and have hereunto affixed
the seal of said City of Fort Worth, this 23rd day of July, 1996
~
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•~---~~ ~'`' City Secretary of the
.
~,^"~ City of Fort Worth, Texas
~~6
(SEAL) ~ ~`
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City of Fort Worth, Texas
Mayor and Council Communication
DATS RSFSRSNCS NUMSSR LOG NAME PAGE I
07/09/96 13Adopt 1 of 1
SIISJECT ADOPTION OF FOURTH SUPPLEMENTAL ORDINANCE AUTHORIZING THE
EXECUTION AND DELIVERY OF INTEREST RATE SWAP AGREEMENTS IN
CONNECTION WITH THE WATER AND SEWER SYSTEM FINANCE PROGRAM
RECOMMENDATION
It is recommended that the City Council adopt the attached fourth supplemental ordinance
authorizing the execution and delivery of interest rate swap agreements with GBDP and Lehman
Brothers in connection with the City's Water and Sewer System Finance Program
DISCUSSION
Adoption of this ordinance will authorize the City to enter into two interest rate swap
agreements, one with GBDP (Grisgby Brandford) and one with Lehman Brothers, secured by
revenues from the Water and Sewer System Informal Report #8007, dated June 11, 1996,
explained the details of a swap transaction Each swap agreement will have a notional amount
of $20 million and a 5-year term The City will pay a variable interest rate based on a short-term
interest rate index (currently about 3 95%) The swap providers (GBDP and Lehman) will pay
the City a fixed rate of approximately 4 90% The variable rate and the fixed rate will be netted,
and as long as the City's variable rate remains below the fixed rate paid by the swap providers,
the City will experience debt service savings in the Water and Sewer Enterprise Fund
FISCAL INFORMATION/CERTIFICATION
The Director of Fiscal Services certifies that any net payments required under the terms of these
agreements will be available in the operating budget, as appropriated, in the Water and Sewer
Fund
CB•f
Submitted for City Manager's FUND ACCOUNT CENTER AMOUNT CITY SECRETARY
Office by: (to)
APPROVED
Charles Boswell 8511 CITY COUN
Originating Department Head: CIL
Jim Keyes 8517
(from) JUL ~~ 136
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For Additional Information .
C ~Q-
ty ~- of ~e
Contact: City of Post Vt-ortlt, Tezas
Jim Keyes 8517
Printed on Recyded Paper /''1~~
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