Common use of Increased Costs and Reduced Return Clause in Contracts

Increased Costs and Reduced Return. (a) If any Change in Law shall: (i) impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for account of, or credit extended by, the Bank or any Participant (each of the foregoing, an “Affected Bank”); (ii) impose on any Affected Bank any other condition affecting this Agreement or any Related Document; or (iii) subject any Affected Bank to any tax, duty or other charge with respect to this Agreement or the Related Documents, or shall change the basis of taxation of payments to the Affected Bank of the principal of or interest with respect to the Letters of Credit or in respect of any other amounts due under this Agreement or the Related Documents (except for changes in the rate of tax on the overall net income of the Affected Bank) imposed by the jurisdiction in which the Affected Bank’s principal executive office is located; and the result of any of the foregoing shall be to increase the cost to such Affected Bank of maintaining any Letter of Credit or making any Advance or maintaining any participation therein or in the Related Documents or to reduce the amount of any sum received or receivable by such Affected Bank hereunder (whether of principal, interest or otherwise) or under any Related Document, then the Agency will pay to such Affected Lender such additional amount or amounts as will compensate such Affected Bank for such additional costs incurred or reduction suffered. (b) If any Affected Bank determines that any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Affected Bank’s capital or on the capital of such Affected Bank’s holding company, if any, as a consequence of this Agreement, the Letters of Credit, any Advance made by the Bank or any participation in any of the foregoing to a level below that which such Affected Bank or such Affected Bank’s holding company could have achieved but for such Change in Law (taking into consideration such Affected Bank’s policies and the policies of such Affected Bank’s holding company with respect to capital adequacy and liquidity), then from time to time the Agency will pay to such Affected Bank such additional amount or amounts as will compensate such Affected Bank or such Affected Bank’s holding company for any such reduction suffered. (c) The Affected Bank will promptly notify the Agency of any event of which it has knowledge, occurring after the date hereof, which will entitle the Affected Bank to compensation pursuant to this Section. A certificate of the Affected Bank claiming compensation under this Section and setting forth the additional amount or amounts to be paid to it hereunder shall be conclusive in the absence of manifest error. In determining such amount, the Affected Bank may use any reasonable averaging and attribution methods. (e) Section 4.1 of the 2003 Agreement shall be deleted in its entirety and the following shall be substituted therefor:

Increased Costs and Reduced Return. (a) If any Change in Law shall: (i) impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for account of, or credit extended by, the Bank or any Participant (each of the foregoing, an “Affected Bank”); (ii) impose on any Affected Bank any other condition affecting this Agreement or any Related Document; or (iii) subject any Affected Bank to any tax, duty or other charge with respect to this Agreement or the Related Documents, or shall change the basis of taxation of payments to the Affected Bank of the principal of or interest with respect to the Letters of Credit or in respect of any other amounts due under this Agreement or the Related Documents (except for changes in the rate of tax on the overall net income of the Affected Bank) imposed by the jurisdiction in which the Affected Bank’s principal executive office is located; and the result of any of the foregoing shall be to increase the cost to such Affected Bank of maintaining any Letter of Credit or making any Advance or maintaining any participation therein or in the Related Documents or to reduce the amount of any sum received or receivable by such Affected Bank hereunder (whether of principal, interest or otherwise) or under any Related Document, then the Agency will pay to such Affected Lender such additional amount or amounts as will compensate such Affected Bank for such additional costs incurred or reduction suffered. (b) If any Affected Bank determines that any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Affected Bank’s capital or on the capital of such Affected Bank’s holding company, if any, as a consequence of this Agreement, the Letters of Credit, any Advance made by the Bank or any participation in any of the foregoing to a level below that which such Affected Bank or such Affected Bank’s holding company could have achieved but for such Change in Law (taking into consideration such Affected Bank’s policies and the policies of such Affected Bank’s holding company with respect to capital adequacy and liquidity), then from time to time the Agency will pay to such Affected Bank such additional amount or amounts as will compensate such Affected Bank or such Affected Bank’s holding company for any such reduction suffered. (c) The Affected Bank will promptly notify the Agency of any event of which it has knowledge, occurring after the date hereof, which will entitle the Affected Bank to compensation pursuant to this Section. A certificate of the Affected Bank claiming compensation under this Section and setting forth the additional amount or amounts to be paid to it hereunder shall be conclusive in the absence of manifest error. In determining such amount, the Affected Bank may use any reasonable averaging and attribution methods. (e) Section 4.1 of the 2003 1996 Agreement shall be deleted in its entirety and the following shall be substituted therefor:

Increased Costs and Reduced Return. (a) If any Change in Law shall: (i) impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for account of, or credit extended by, the Bank or any Participant (each of the foregoing, an “Affected Bank”); (ii) impose on any Affected Bank any other condition affecting this Agreement or any Related Document; or (iii) subject any Affected Bank to any tax, duty or other charge with respect to this Agreement or the Related Documents, or shall change the basis of taxation of payments to the Affected Bank of the principal of or interest with respect to the Letters of Credit or in respect of any other amounts due under this Agreement or the Related Documents (except for changes in the rate of tax on the overall net income of the Affected Bank) imposed by the jurisdiction in which the Affected Bank’s principal executive office is located; and the result of any of the foregoing shall be to increase the cost to such Affected Bank of maintaining any Letter of Credit or making any Advance or maintaining any participation therein or in the Related Documents or to reduce the amount of any sum received or receivable by such Affected Bank hereunder (whether of principal, interest or otherwise) or under any Related Document, then the Successor Agency will pay to such Affected Lender such additional amount or amounts as will compensate such Affected Bank for such additional costs incurred or reduction suffered. (b) If any Affected Bank determines that any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Affected Bank’s capital or on the capital of such Affected Bank’s holding company, if any, as a consequence of this Agreement, the Letters of Credit, any Advance made by the Bank or any participation in any of the foregoing to a level below that which such Affected Bank or such Affected Bank’s holding company could have achieved but for such Change in Law (taking into consideration such Affected Bank’s policies and the policies of such Affected Bank’s holding company with respect to capital adequacy and liquidity), then from time to time the Successor Agency will pay to such Affected Bank such additional amount or amounts as will compensate such Affected Bank or such Affected Bank’s holding company for any such reduction sufferedsuffered that is not compensated in full by the increase in Facility Fee resulting from the application of the Liquidity Coverage Ratio Surcharge. (c) The Affected Bank will promptly notify the Successor Agency of any event of which it has knowledge, occurring after the date hereof, which will entitle the Affected Bank to compensation pursuant to this Section. A certificate of the Affected Bank claiming compensation under this Section shall state the change which has occurred, affecting or with respect to the Related Documents, or the reserve requirements or other costs or conditions which have been imposed on the Affected Bank or the request, direction or requirement with which it has complied, together with the date thereof, the amount of such increased cost, reduction or payment and setting forth a reasonably detailed description of the additional way in which such amount has been calculated, and the Affected Bank’s determination of such amounts, absent fraud or amounts to be paid to it hereunder manifest error, shall be conclusive in the absence of manifest errorconclusive. In determining such amount, the Affected Bank may use any reasonable averaging and attribution methods. (e) Section 4.1 of the 2003 Agreement shall be deleted in its entirety and the following shall be substituted therefor: