Translation of General Conditions for EKN's Counter Guarantee ...

Translation of General Conditions for EKN’s Counter Guarantee(Swedish version dated November 2004).Disclaimer:Please note that this is a translation of EKN’s General Conditions for the Counter Guarantee.In case of any discrepancies, the Swedish version will prevail.

Draft 21. Definitions of certain expressions:In these General Conditions the following terms have meanings set forth below:Exporter: the party on whose behalf the Guarantee Holder issues a Contract Guarantee.Beneficiary: the party in whose favour the Contract Guarantee is issued.Guarantee Instrument: the document whereby the Counter Guarantee is issued.Guarantee Percentage: the percentage share of an incurred loss covered by the Counter Guarantee.Cf Uncovered Portion.Guarantee Holder: the party who has received EKN’s Counter Guarantee in accordance with theseGeneral Conditions.Joint Collateral: such security as has been provided by the Exporter in favour of the GuaranteeHolder, as precondition for the Contract Guarantee, and in which EKN has an interest in accordancewith the terms of Guarantee Instrument.Called Contract Guarantee: Contract Guarantee under which the Guarantee Holder, following ademand from the Beneficiary, has made a payment.Adjustment: reduction of the Indemnification. In some cases, the reduction may be made to nil.Contract Guarantee: a commitment issued by the Guarantee Holder for completion of a bid, forcompletion of work or a delivery in accordance with the contract, for repayment of any part of thepurchase price that the Exporter has received, or any other commitment approved by EKN, includingcommitments issued by the Guarantee Holder to any other issuer.Amount of Counter Guarantee: the highest amount of loss paid by EKN in Indemnification.Interest: the market interest rate at any point in time computed on the basis of STIBOR, LIBOR,EURIBOR or the equivalent for one month plus one quarter (0.25) of a percentage point.Uncovered Share: the percentage share of an incurred loss not covered by the Counter Guarantee. Cf.Guarantee Percentage.Indemnification: the payment of compensation according to the terms of the Counter Guarantee.Recovery: the amount EKN or the Guarantee Holder receives after payment of Indemnificationfollowing a Called Contract Guarantee.Disclaimer: 2(8)Please note that this is a translation of EKN’s General Conditions for the Counter Guarantee.In case of any discrepancies, the Swedish version will prevail.

Draft 22 Scope of the Counter Guarantee2.1 A Counter Guarantee, covers, to the extent provided by these General Conditions andGuarantee Instrument, certain risks for losses associated with the issue of Contract Guarantees inexport transactions.2.2 A Counter Guarantee offers right to compensation, in accordance with the GuaranteePercentage, for Guarantee Holder’s losses incurred as a result of a Called Contract Guarantee.The Amount of Counter Guarantee and the Guarantee Percentage are stated in Guarantee Instrument.Special conditions may apply to the Counter Guarantee that complement or deviate from these generalconditions. In such a case, these are also stated in Guarantee Instrument.2.3 The Counter Guarantee does not cover losses that arise as a consequence of fault or negligenceby the Guarantee Holder.Nor does the Counter Guarantee provide compensation for losses incurred as a result of measurestaken by a Swedish government authority.The Counter Guarantee is valid from the date of issue of the Contract Guarantee, or such other time asis stated in Guarantee Instrument, and it covers losses incurred thereafter.3 Conditions for the validity of the Counter Guarantee3.1 The agreement between the Guarantee Holder and the Exporter in respect of the issuance ofContract Guarantees may not include provisions or otherwise be formulated in a way that limits theGuarantee Holder’s ability to fulfil his obligations under the terms of Guarantee Instrument and theseGeneral Conditions.3.2 The Contract Guarantee shall be issued in accordance with what is stated in the application forthe Counter Guarantee. The Contract Guarantee may not be altered thereafter without EKN’s writtenconsent.3.3 The Guarantee Holder may not, without EKN’s written consent, waive, in full or in part, claimfor damage or other compensation by the Exporter, the Beneficiary or any other party or from JointCollateral.3.4 In the event that the Guarantee Holder has failed to observe the provisions of points 3.1-3.3,and such failure has increased EKN’s risk of loss, the Indemnification under the Counter Guaranteeshall be adjusted accordingly.If the Guarantee Holder has given EKN incorrect, incomplete or misleading information ofsignificance for the issue of the Counter Guarantee, and if this has increased EKN’s risk of loss, theIndemnification under the Counter Guarantee shall be adjusted accordingly, provided that theGuarantee Holder was aware, or should have been aware, that the information was incorrect,incomplete or misleading.Disclaimer: 3(8)Please note that this is a translation of EKN’s General Conditions for the Counter Guarantee.In case of any discrepancies, the Swedish version will prevail.

Draft 2thereon. In the event of uncertainty regarding which Guarantee Holder is at fault, the GuaranteeHolders shall be liable jointly and severally.7 Disputes regarding the Counter Guarantee7.1 Swedish law is applicable for the Counter Guarantee.7.2 Any dispute in connection with the Counter Guarantee shall be settled by arbitrators inaccordance with Swedish law on arbitrators, in force at the time when the dispute arises. Arbitrationproceedings shall take place in Stockholm.Should the Guarantee Holder wish to refer a decision taken by EKN to arbitration, he shall file suchdemand within twelve months of receiving the decision in question. If he fails to do so he shall forfeithis right of action.Should the arbitrators arrive at different decisions concerning a valuation matter, the average value shallapply as the decision of the arbitrators.Disclaimer: 8(8)Please note that this is a translation of EKN’s General Conditions for the Counter Guarantee.In case of any discrepancies, the Swedish version will prevail.