Template:Nutshell GMSLA 2.1

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2.1. In this agreement:
Act of Insolvency means for either Party:

(a) a general assignment for the benefit of, or entering into a reorganisation, arrangement, or composition with creditors; or
(b) its admission it is unable to pay its debts when due; or
(c) an administrator is appointed over a material part of its business (or it seeks one); or
(d) a bankruptcy petition is filed on it (other than in by reference to Agreement) and is not stayed or dismissed within 30 days; or
(e) its creditors meet to consider a voluntary arrangement between them;

Agency Annex means the Annex to this Agreement under which a Lender to act as an agent lender for Loans;
Alternative Collateral means Collateral with a Market Value equal to delivered Collateral provided by way of substitution under paragraph 5.3;
Applicable Law means all relevant laws, rules, regulations, taxes, practice notes and rulings published in connection with them;
Automatic Early Termination is defined in paragraph 10.1(d);
Base Currency is specified in paragraph 2 of the Schedule;
Business Day means a weekday on which banks and markets are generally open:

(a) For Delivery: where the Securities, Collateral and their Equivalents are to be delivered;
(b) For payments: in the principal financial centre for the relevant currency and where any relevant account designated in the Agreement is situated (or for euro, a day when TARGET operates);
(c) For notices: where the notice is due to be delivered (per Schedule paragraph 3); and
(d) Any other case: in each place stated in Schedule paragraph 6;

Buy-In means an agreement where a transferee who buys in equivalent securities to cover a settlement failure can recover its costs of doing so from a failing transferor;
Cash Collateral means, you know, Collateral in cash;
Close of Business for any business centre is the time of day when banks and settlement systems close;
Collateral means the financial instruments and cash meeting eligibility criteria in paragraph 1 of the Schedule which Borrower has delivered to Lender to collateralise any Loan, as replaced by Alternative Collateral;
Defaulting Party is defined in paragraph 10;
Delivery and deliver means to credit Securities, Collateral or Equivalents to the transferee’s account or as it directs;
Designated Office means the office of a Party specified in paragraph 6 of the Schedule;
Equivalent: securities that are fungible with the securities in question, as long as:

(a) Where the securities are partly paid or have been converted, subdivided, consolidated, made the subject of a takeover, rights of pre-emption, or include rights to receive securities, it includes securities a holder would be entitled after that event (having complied with all formalities) and provided that the party being paid the equivalent amount has given notice and paid the all sums required in time for the holder to exercise its rights.
(b) Where the securities:
(i) have been redeemed, it means the redemption proceeds;
(ii) are subject to a call, it means fungible securities, provided that receiving party thas paid the holder the amounts due in respect of the call;
(iii) are subject to a capitalisation issue, it includes securities allotted by way of bonus on the securities in question;
(iv) are subject to any similar event, it means those securities with (or replaced by) the cash and securities received by the holder in connection with the event.

Income means interest, dividends and similar distributions[1] made under any Securities or Collateral;
Income Record Date means the date by reference to which holders of Securities or Collateral become entitled to Income;
Letter of Credit means an irrevocable, non-negotiable bank letter of credit acceptable to Lender;
Loaned Securities means Securities that are presently out on Loan;
Margin is defined in paragraph 1 of the Schedule.
Market Value means:
(a) Securities: For Securities the mid price market quotation at Close of Business on the previous Business Day

(i) published on a reputable information service chosen by the Lender; or failing that
(ii) derived from a mid price from a dealer chosen by the Lender
(unless either party thinks there’s been an unusual market movement since then, in which case the latest available price) plus:
(iii) accrued Income if not included in the quote.

Where the assets in question are not trading freely the Parties may agree their Market Value. Failing that, they can ask an mutually acceptable dealer to quote. If they can’t agree on one of those, they can seek an average of Reference Dealer quotations (with a laborious mechanism for figuring our what to include and how to average it). If all else fails the Market Value giving up altogether and falling back on the reasonable determination of the Party originally making the determination).[2]
(b) Letters of credit: for any Letter of Credit, its face value.
(c) Cash: for Cash its face value.
Nominee means an agent a Party appoints to hold its Securities or Collateral or to handle its payments;
Non Cash Collateral means Collateral that isn't cash;
Non-Defaulting Party is defined in Paragraph 10;
Notification Time is defined in Paragraph 1.5 of the Schedule;
Parties (and Party) means Lender and Borrower; Posted Collateral is defined in Paragraph 5.4;
Reference Dealers means four leading dealers in the relevant market chosen by the person determining an Market Value.
Required Collateral Value is defined in Paragraph 5.4;
Sales Tax means any VAT, sales tax or similar Tax;
Settlement Date is the date on which Securities are due to be transferred to Borrower;
Stamp Tax is any stamp, transfer, registration or similar Tax;
Tax means any kind of tax imposed by any taxing authority on any transaction or payment under this Agreement.

  1. Note: this contains significant JC editorialising about what this clause is meant to, but if read literally, does not achieve: See commentary under Income.
  2. Tiresome, I know.