"Adjusted Estimated Fair Value of the Agreement

means the Estimated Fair Value of the Agreement" adjusted as follows:

(a) where in respect of any month or part of a month from the Termination Date to the Compensation Date the Post Termination Service Amount is a negative number, the aggregate of all such negative Post Termination Service Amounts shall be set against and shall reduce the Estimated Fair Value of the Agreement (whether or not such amounts have been set-off by the Board pursuant to paragraph 3.8 of Section B of this Part 23 of the Schedule);

the aggregate of the following amounts shall be deducted from the Estimated Fair Value of the Agreement;

(b) the Post Termination Service Amounts actually paid by the Board to Project Co prior to the Compensation Date;]198 199

(c) the Tender Costs; and

(d) amounts that the Board is entitled to set off or deduct,

the aggregate of the following amounts shall be added to the Estimated Fair Value of the Agreement:

(e) all credit balances on any bank accounts held by or on behalf of Project Co on the date that the Estimated Fair Value of the Agreement is calculated; and

(f) any insurance proceeds and other amounts owing to Project Co (and which Project Co is entitled to retain), to the extent not included in (e);

to the extent that:

(i) (e) and (f) have not been directly taken into account in calculating the Estimated Fair Value of the Agreement; and

(ii) the Board has received such amounts in accordance with this Agreement or such amounts are standing to the credit of the Insurance Proceeds Account;

"Adjusted Highest Compliant Tender Price"200

means the price offered by the Compliant Tenderer (if any) with the highest tender price being the aggregate of:

(i) the capital sum offered by such Compliant Tenderer; and

(ii) the Forecast Charitable Donations

and, if no Compliant Tenders are received, zero adjusted as follows:

(a) where in respect of any month or part of a month from the Termination Date to the Compensation Date the Post Termination Service Amount is a negative number, the aggregate of all such negative Post Termination Service Amounts shall be set against and shall reduce such highest tender price (whether or not such amounts have been set-off by the Board pursuant to paragraph 3.8 of Section B of this Part 23 of the Schedule);

the aggregate of the following amounts shall be deducted from such highest tender price:

(aa) the Forecast Charitable Donations

(b) the Post Termination Service Amounts actually paid by the Board to Project Co prior to the Compensation Date;

(c) the Tender Costs; and

(d) amounts that the Board is entitled to set off or deduct,

the aggregate of the following amounts shall be added to such highest tender price:

(e) all credit balances on any bank accounts held by or on behalf of Project Co on the date that the highest priced Compliant Tender is received;201 and

(f) any insurance proceeds and other amounts owing to Project Co (and which Project Co is entitled to retain), to the extent not included in (d);

to the extent that:

(i) (e) and (f) have not been directly taken into account in that Compliant Tender; and

(ii) the Board has received such amounts in accordance with this Agreement;

"Base Senior Debt Amount"202

means, subject to Clause 4.3 (Changes to Funding Agreements and Refinancing):

(a) all amounts outstanding at the Termination Date, including interest and Default Interest accrued as at that date, from Project Co to the Senior Funders in respect of Permitted Borrowings (other than in respect of Additional Permitted Borrowing); and

(b) all amounts including costs of early termination of interest rate hedging arrangements and other breakage costs203, payable by Project Co to the Senior Funders as a result of a prepayment in respect of Permitted Borrowings (other than in respect of Additional Permitted Borrowing), or, in the case of early termination of interest rate hedging arrangements only, as a result of termination of this Agreement, subject to Project Co and the Senior Funders mitigating all such costs to the extent reasonably possible;

less, to the extent it is a positive amount the aggregate of (without double counting in relation to the calculation of the Base Senior Debt Amount or the amounts below)

(i) any amounts claimable on or after the Termination Date in respect of Contingent Funding Liabilities;

(ii) all amounts including costs of early termination of interest rate hedging arrangements and other breakage costs, payable by the Senior Funders to Project Co as a result of prepayment of amounts outstanding in respect of Permitted Borrowings (other than in respect of Additional Permitted Borrowing), or, in the case of early termination of interest rate hedging arrangements only, as a result of termination of this Agreement;

(iii) all other amounts received by the Senior Funders on or after the Termination Date and before the date on which any compensation is payable by the Board to Project Co as a result of enforcing any other rights they may have; and

(iv) all credit balances on any bank accounts (but excluding the Joint Insurance Account) held by or on behalf of Project Co on the Termination Date;

"Compensation Date"

means either:

(a) if paragraph 3 of Section B of this Part 23 of the Schedule (Retendering Procedure) applies, the earlier of:

(i) the date that the New Agreement is entered into; and

(ii) the date on which the Board pays the Adjusted Highest Compliant Tender Price to Project Co, or

(b) if paragraph 4 of Section B of this Part 23 of the Schedule (No Retendering Procedure) applies, the date that the Adjusted Estimated Fair Value of the Agreement has been agreed or determined;

"Compliant Tender"

means a tender that meets all of the Qualification Criteria;

"Compliant Tenderer"

means a tenderer who submits a Compliant Tender;

["Contingent Funding Liabilities"

[insert any contingent liabilities of the shareholders in respect of financial obligations owed to the Contractor and/or Funders under the Funding Agreements which are triggered as a result of or in relation to the termination of the Agreement, e.g. guarantees or letters of credit in respect of deferred equity];204

"Deemed New Agreement"

means an agreement on the same terms and conditions as this Agreement, as at the Termination Date, but with the following amendments:

(a) if this Agreement is terminated prior to the Actual Completion Date, then the [Longstop Date] shall be extended by a period to allow a New Project Co (had one been appointed)205 to achieve the Actual Completion Date prior to the Longstop Date;

(b) any accrued [Performance Points] and/or Warning Notices shall, for the purposes of termination only, and without prejudice to the rights of the Board to make financial deductions, be cancelled; and

(c) the term of such agreement shall be for a period equal to the term from the Termination Date to the Expiry Date;206

"Discount Rate"207

means a discount rate expressed as [(1+ real base case project IRR + Gilt B - Gilt A)*(1+i) -1]

where:

"real base case project IRR" is the real pre-tax [Project IRR] as set out in the Financial Model at Financial Close;

"i" is the agreed assumed forecast rate of increase in RPI set out in the Agreement, for the remaining term of the Agreement;

"Gilt A" is the real yield to maturity on a benchmark government Gilt instrument of the same maturity as the average life of the outstanding Senior Debt as shown in the Financial Model at Financial Close;

and

"Gilt B" is the real yield to maturity on a benchmark government Gilt instrument of the same maturity as the average life of the outstanding Senior Debt as shown in the Financial Model as on the Termination Date;

"Estimated Fair Value of the Agreement"

means the amount determined in accordance with paragraph 4 of Section B of this Part 23 of the Schedule (No Retendering Procedure) that a third party would pay to the Board as the market value of the Deemed New Agreement;

"Forecast Charitable Donations"

means the Net Present Value of the Charitable Donations projected to be made by the Compliant Tenderer provided that the Board (acting reasonably) is satisfied that the amount of such Charitable Donations is reasonable;

"Invoice Date"

means, in respect of the Board Default Termination Sum, the Force Majeure Termination Sum or the Corrupt Gifts Termination Sum (as appropriate), the date that is the later of:

(i) the date on which the Board receives an invoice from Project Co for the relevant termination sum; and

(ii) the date on which the Board receives the supporting evidence required pursuant to paragraph 1.1 of Section E of this Part 23 of the Schedule;

"Junior Debt"

has the meaning given in Part 1 of the Schedule (Definitions and Interpretation);

["Market Value Availability Deduction Amount"

means for any month or part of a month, an amount equal to the availability deduction that was made to the Service Payment under Section 1 of Part 18 of the Schedule in the month immediately preceding the Termination Date, less an amount equal to any availability deduction that was made for a Functional Part which was unavailable at the Termination Date but which has subsequently become available whether as a result of the Board incurring Rectification Costs or otherwise]208;

"Market Value of the Agreement"

means the value of the consideration payable by the New Project Co to the Board [in consideration for the entering into of the New Agreement];

"Maximum Service Payment"

means the Service Payments payable at any time before any deductions under Section 1 of Part 18 of the Schedule but allowing for indexation under the [indexation provisions];

"Maximum Termination Amount"

means the aggregate of:

(a) the Base Senior Debt Termination Amount; and

(b) the principal amount outstanding of Junior Debt; and

(c) any Sub-Contractor Breakage Costs

provided that if the aggregate of the amounts referred to in (a) and (b) is less than the Revised Senior Debt Termination Amount, then the Maximum Termination Amount shall be increased so that it is equal to the aggregate of the Revised Senior Debt Termination Amount and the amount referred to in (c)

"Net Present Value"

has the meaning given in Part 29 of the Schedule (Refinancing)

"New Agreement"

means an agreement on the same terms and conditions as this Agreement209 at the Termination Date, but with the following amendments:

(a) if this Agreement is terminated prior to the Actual Completion Date, then the [Longstop Date] shall be extended by a period to allow a New Project Co210 to achieve the Actual Completion Date prior to the [Longstop Date];

(b) any accrued [Service Failure Points] and/or Warning Notices shall, for the purposes of termination only, and without prejudice to the rights of the Board to make financial deductions, be cancelled;

(c) the term of such agreement shall be equal to the term from the [Termination Date]211 until the Expiry Date; and

(d) any other amendments which do not adversely affect the Project Co;

"New Project Co"

means the person who has entered or who will enter into the New Agreement with the Board;

"No Default Interest Rate"

means [incorporate the non-default interest rate definition in the Senior Funders Agreements];

"Post Termination Service Amount"212

means for the purposes of paragraph 3 of Section B of this Part 23 of the Schedule (Retendering Process), for the whole or any part of a month for the period from the Termination Date to the Compensation Date, an amount equal to the Maximum Service Payment which would have been payable under this Agreement had this Agreement not been terminated, less an amount equal to the aggregate of (without double counting):

(a) the reasonable and proper cost to the Board of procuring the Services;

(b) the [Market Value Availability Deduction Amount] for that month; and

(c) the Rectification Costs incurred by the Board in that month;213

"Qualification Criteria"

means the criteria that the Board requires tenderers to meet as part of the Tender Process, which (subject to compliance with procurement regulations) shall be:

(a) the New Agreement terms;

(b) tenderers should have the financial ability to pay the capital sum tendered for the New Agreement and the financial ability to deliver the Works and/or the Services (as appropriate) for the price tendered;

(c) the tenderers may only bid on the basis of a single capital payment214 to be made on the date of the New Agreement; and

(d) the tenderer is experienced in providing the Services or similar services

(e) the technical solution proposed by the tenderers is capable of delivery and the tenderer is technically capable of delivery of the Services; and

(f) any other tender criteria agreed by the Board and the Project Co;

"Rectification Costs"

means, for the purposes of any Termination Date that occurs after the Actual Completion Date, an amount equal to the reasonable and proper costs incurred by the Board in a particular month or part of a month in ensuring that the Services215 are available;

"Redundancy Payments"

means redundancy payments and other termination payments which are required under Law to be made to employees of Project Co reasonably and properly incurred by Project Co arising as a direct result of terminating this Agreement (provided that Project Co shall use all reasonable endeavours to mitigate its loss) and provided that in calculating such amount no account should be taken of any liabilities and obligations of Project Co arising out of:

(a) contracts of employment or other agreements or arrangements entered into by Project Co to the extent that such contracts of employment agreements or arrangements were not entered into in connection with the Project; and/or

(b) contracts of employment or other agreements or arrangements entered into by Project Co to the extent that such contracts of employment agreements or arrangements were not entered into in the ordinary course of business and on commercial arm's length terms;

"Relevant Assumptions"

means the assumptions that the sale of Project Co and the Junior Debt is on the basis that there is no default by the Board, that the sale is on a going concern basis, that no restrictions exist on the transfer of the Junior Debt or share capital216, that no Additional Permitted Borrowing has taken place and therefore that the effect of the Additional Permitted Borrowing on the calculation of such amount is disregarded but that otherwise the actual state of affairs of Project Co and the Project is taken into account;

"Revised Senior Debt Termination Amount"217

means, subject to Clause 4.3 (Changes to Funding Agreements and Refinancing):

(a) all amounts outstanding at the Termination Date, including interest and (other than in respect of Additional Permitted Borrowing) Default Interest accrued as at that date, from Project Co to the Senior Funders in respect of Permitted Borrowing; and

(b) all amounts including costs of early termination of interest rate hedging arrangements and other breakage costs218, payable by Project Co to the Senior Funders as a result of a prepayment in respect of Permitted Borrowing, or, in the case of early termination or interest rate hedging arrangements only, as a result of termination of this Agreement subject to Project Co and the Senior Funders mitigating all such costs to the extent reasonably possible,

less, to the extent it is a positive amount, the aggregate of (without double counting in relation to the calculation of the Revised Senior Debt Termination Amount or the amounts below);

(i) all credit balances on any bank accounts (but excluding the Joint Insurance Account) held by or on behalf of Project Co on the Termination Date;

(ii) any amounts claimable on or after the Termination Date in respect of Contingent Funding Liabilities;

(iii) all amounts, including costs of early termination of interest rate hedging arrangements and other breakage costs, payable by the Senior Funders to Project Co as a result of prepayment of amounts outstanding in respect of Permitted Borrowing, or, in the case of early termination of interest rate hedging arrangements only, as a result of termination of this Agreement;

(iv) all other amounts received by the Senior Funders on or after the Termination Date and before the date on which any compensation is payable by the Board to Project Co as a result of enforcing any other rights they may have; and

(v) all APB Distributions;

"Senior Debt"

means the financing provided by the Senior Funders under the Senior Funders Agreements;

"Senior Debt Amount"219

means, the Revised Senior Debt Termination Amount or the Base Senior Debt Amount as relevant;

"Senior Funders' Agent"

means the person appointed as agent for the Senior Funders under the Senior Funders Agreements and authorised to act on behalf of the Senior Funders;

"Senior Funders Agreements"

has the meaning given in Part 1 of the Schedule;

"Sub-Contractor Losses"220

means:

(a) the amount reasonably and properly payable by Project Co to the Contractor under the terms of the Construction Contract as a direct result of the termination of this Agreement provided that such amount shall be reduced to the extent that Project Co fails to use all reasonable endeavours to mitigate such amount; and

(b) the amount reasonably and properly payable by Project Co to the Service Providers [under their respective contracts with Project Co] (as the case may be) as a direct result of the termination of this Agreement provided that such amount shall be reduced to the extent that Project Co fails to use all reasonable endeavours to mitigate such amount;

provided that in both cases no account should be taken of any liabilities and obligation of Project Co to the Sub-Contractors arising out of:

(i) agreements or arrangements entered into by Project Co and/or the Sub-Contractors to the extent that such agreements or arrangements were not entered into in connection with those parties obligations in relation to the Project; and/or

(ii) agreements or arrangements entered into by Project Co and/or the Sub-Contractors to the extent that such agreements or arrangements were not entered into in the ordinary course of business and on commercial arm's length terms;

"Suitable Substitute Contractor"

as defined in the Senior Funders' Direct Agreement;

"Tender Costs"

means the reasonable and proper costs of the Board incurred in carrying out the Tender Process and/or in connection with any calculation of the Estimated Fair Value of the Agreement;

"Tender Process"

means the process by which the Board requests tenders from any parties interested in entering into a New Agreement, evaluates the responses from those interested parties and enters into a New Agreement with a new service provider, in accordance with paragraph 3 of Section B of this Part 23 of the Schedule (Retendering Procedure); and

"Tender Process Monitor"

means the person appointed under paragraph 3.6 of Section B of this Part 23 of the Schedule.