The non-defaulting party shall (except upon the occurrence of an Act of
Insolvency)
give notice
as promptly as practicable to the defaulting party of the exercise of its option to terminate all
Loans hereunder pursuant to this Section 12.
13. Remedies.
13.1 Upon the occurrence of a Default under Section 12 entitling Lender to terminate all Loans
hereunder, Lender shall have the right, in addition to any other remedies provided herein,
(which, upon the occurrence of an Act of Insolvency, may be exercised following the
termination of any applicable stay) (a) to purchase a like amount of Loaned Securities
(“Replacement Securities”) in the principal market for such Loaned Securities in a
commercially reasonable manner, (b) to sell any Collateral in the principal market for such
Collateral in a
commercially
reasonable manner and (c) to apply and set off the Collateral
and any proceeds thereof (including any amounts drawn under a letter of credit supporting
any Loan) against the payment of the purchase price for such Replacement Securities and
any amounts due to Lender under Sections 5, 8, 14 and 16. In the event that Lender shall
exercise such rights,
Borrower
’
s obligation to return a like amount of the Loaned Securities
shall terminate. Lender may similarly apply the Collateral and any proceeds thereof to any
other obligation of Borrower under this Agreement, including
Borrower
’
s obligations with
respect to Distributions paid to Borrower (and not forwarded to Lender) in respect of
Loaned Securities. In the event that (i) the purchase price of Replacement Securities (plus
all other amounts, if any, due to Lender hereunder) exceeds (ii) the amount of the
Collateral, Borrower shall be liable to Lender for the amount of such excess together with
interest thereon at a rate equal to (A) in the case of purchases of Foreign Securities, LIBOR,
(B) in the case of purchases of any other Securities (or other amounts, if any, due to Lender
hereunder), the Federal Funds Rate or (C) such other rate as may be specified in Schedule
B, in each case as such rate fluctuates from day to day, from the date of such purchase until
the date of payment of such excess. As security for
Borrower
’
s obligation to pay such
excess, Lender shall have, and Borrower hereby grants, a security interest in any property of
Borrower then held by or for Lender and a right of setoff with respect to such property and
any other amount payable by Lender to Borrower. The purchase price of Replacement
Securities purchased under this Section 13.1 shall include, and the proceeds of any sale of
Collateral shall be determined after deduction of, broker
’
s fees and commissions and all
other reasonable costs, fees and expenses related to such purchase or sale (as the case may
be). In the event Lender exercises its rights under this Section 13.1, Lender may elect in its
sole discretion, in lieu of purchasing all or a portion of the Replacement Securities or selling
all or a portion of the Collateral, to be deemed to have made, respectively, such purchase of
Replacement Securities or sale of Collateral
for an amount equal to the price therefor on the date of such exercise obtained from a
generally recognized source or the last bid quotation from such a source at the most
recent Close of Trading. Subject to Section 18, upon the satisfaction of all obligations
hereunder, any remaining Collateral shall be returned to Borrower.
13.2 Upon the occurrence of a Default under Section 12 entitling Borrower to terminate all
Loans hereunder, Borrower shall have the right, in addition to any other remedies provided
herein, (which, upon the occurrence of an Act of Insolvency, may be exercised following
the termination of any applicable stay), (a) to purchase a like amount of Collateral
(“Replacement Collateral”) in the principal market for such Collateral in a
commercially
reasonable manner, (b) to sell a like amount of the Loaned Securities in the principal market
for such Loaned Securities in a commercially reasonable manner and (c) to apply and set
off the Loaned Securities and any proceeds thereof against (i) the payment of the purchase
price for such Replacement Collateral, (ii)
Lender
’
s obligation to return any cash or other
Collateral, and (iii) any amounts due to Borrower under Sections 5, 8 and 16. In such event,
Borrower may treat the Loaned Securities as its own and
Lender
’
s obligation to return a like