Default interest - GMRA Provision: Difference between revisions

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{{manual|MSG|2010|10(f)|Clause||medium}}Compare with Clause {{gmraprov|4(f)}}, which is the standard interest payable on the cash leg of a {{gmraprov|Transaction}}.
{{manual|MRG|2000|10(f)|Clause|11(h)|medium}}
 
This is ''default'' [[interest]], where things have gone Pete Tong for one party and the other has referred matters to its learned friends. In theory, this provision references the dreaded [[LIBOR]] — cue obligatory reference to the [[dramatic look gopher]] — and is thus in scope for [[LIBOR]] remediation, but in practice the question is this:
:''Is the world going to go any '''further''' towards hell in a hand-basket if there is confusion about the [[interest]] rate which you charge on the accrual of your legal fees?''
Respectfully — given that, on the theory of the game your Counterparty is already smoking ruin; thus, you are ''already'' in hell, in a hand-basket — the [[JC]] respectfully submits it will not.
===[[GMSLA]] equivalent===
The corresponding {{gmsla}} provision (clause {{gmslaprov|11.7}}) is similar in effect, and in its potential [[LIBOR]] impact.
===[[DLG]]===
And now: A quick [[dramatic look gopher]].
[[File:Dramatic Look Gopher.gif|150px|frameless|center]]
{{sa}}
*Clause {{gmraprov|4(f)}} — {{gmraprov|Interest on Cash Margin}}
*Clause {{gmslaprov|11.7}}, being the equivalent provision in the {{gmsla}}
*[[LIBOR]]

Latest revision as of 10:38, 22 March 2020

2000 Global Master Repurchase Agreement
A Jolly Contrarian owner’s manual™

Resources and navigation

Resources: 2010 GMRA: Full wikitext · Nutshell wikitext
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GMRA

Clause 10(f) in a Nutshell™

Use at your own risk, campers!
10(f) The Defaulting Party must pay the non-Defaulting Party its reasonable professional expenses incurred in connection with an Event of Default plus interest calculated at LIBOR or, if the expense relates to a particular Transaction, the higher of LIBOR and the Pricing Rate for that Transaction.

Full text of Clause 10(f)

10(f) The Defaulting Party shall be liable to the non-Defaulting Party for the amount of all reasonable legal and other professional expenses incurred by the non-Defaulting Party in connection with or as a consequence of an Event of Default, together with interest thereon at LIBOR or, in the case of an expense attributable to a particular Transaction, the Pricing Rate for the relevant Transaction if that Pricing Rate is greater than LIBOR.

Related agreements and comparisons

Related agreements: Click here for the same clause in the 1996 MRA, when we get round to finding out the first thing about it.
Comparison: Template:Gmradiff 11(h)

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Content and comparisons

Template:M comp disc GMRA 10(f)

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Summary

Note reference to dramatic look gopher — LIBOR. LIBOR also applies directly to default payments through Clause 12, but the in-through-the-out-door, reference non-default scenarios too is not quite as pronounced as it is in the 2010 GMSLA, but this will not stop your five-year, thousand-strong LIBOR remediation regulatory change juggernaut tying you up in months trying to work out how badly you must care about LIBOR in the Global Master Repurchase Agreement.

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General discussion

Template:M gen GMRA 10(f)

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See also

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References

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