Template:Isda 1 summ: Difference between revisions
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In a nutshell: DO NOT ADJUST THIS PROVISION. It does no-one any harm. How ''could'' it? | In a nutshell: DO NOT ADJUST THIS PROVISION. It does no-one any harm. How ''could'' it? | ||
...''Unless'' you are writing an {{isdama}} for a [[repackaging vehicle]] issuing segregated, secured, [[limited recourse]] obligations. In that case you — and here I am supposing that “you” are the [[inhouse legal eagle]] at the arranging bank, or someone advising her — will have multiple {{ | ...''Unless'' you are writing an {{isdama}} for a [[repackaging vehicle]] issuing segregated, secured, [[limited recourse]] obligations. In that case you — and here I am supposing that “you” are the [[inhouse legal eagle]] at the arranging bank, or someone advising her — will have multiple {{isdaprov|Transaction}}s ''nominally'' between the same two entities — your employer and the [[SPV]] — but economically being totally distinct, relating as they do to discrete ring-fenced “Series” issued by the [[SPV]] and you absolutely do ''not'' want these to form a [[single agreement]] with each other, or net, or do anything ostensibly desirable like that. | ||
Each {{ | Each {{isdaprov|Transaction}} (or ''set'' of {{isdaprov|Transaction}}s, if more than one {{isdaprov|Transaction}} attaches to a single Series) stands quite alone, should not be [[accelerated]], [[Cross default|cross-defaulted]], [[DUST - ISDA Provision|DUSTed]], closed out or heaven forbid [[Netting - ISDA Provision|netted]], just because some other {{isdaprov|Transaction}}, relating to another series, has gone [[Tetas arriba|''arriba'']]. Treat them as if each Series had its own distinct {{isdama}}, completely isolated, air-gapped and insulated against misadventure occurring in other {{isdama}}s the SPV has entered with you relating to other Series.<ref>Except as regards Bankruptcy of the [[SPV]], but if you have structured your vehicle correctly, it won’t be able to ''go'' bankrupt. And in any case the same bankruptcy event would be an independent Event of Default occurring under each discrete Master Agreement.</ref> | ||
Revision as of 10:57, 4 October 2022
Section {{{{{1}}}|1}} is a gentle introduction indeed to the dappled world of the ISDA Master Agreement: much coming from the “goes without saying, but let’s say it anyway” dept of legal wordwrightery — a large department indeed, in the annals of modern legal practice. It starts getting a bit tasty in Section {{{{{1}}}|1(c)}} with the {{{{{1}}}|Single Agreement}}, but it’s not until the Section {{{{{1}}}|2(a)(iii)}} flawed asset provision that you’re properly in the ISDA ninja twilight zone.
In a nutshell: DO NOT ADJUST THIS PROVISION. It does no-one any harm. How could it?
...Unless you are writing an ISDA Master Agreement for a repackaging vehicle issuing segregated, secured, limited recourse obligations. In that case you — and here I am supposing that “you” are the inhouse legal eagle at the arranging bank, or someone advising her — will have multiple Transactions nominally between the same two entities — your employer and the SPV — but economically being totally distinct, relating as they do to discrete ring-fenced “Series” issued by the SPV and you absolutely do not want these to form a single agreement with each other, or net, or do anything ostensibly desirable like that.
Each Transaction (or set of Transactions, if more than one Transaction attaches to a single Series) stands quite alone, should not be accelerated, cross-defaulted, DUSTed, closed out or heaven forbid netted, just because some other Transaction, relating to another series, has gone arriba. Treat them as if each Series had its own distinct ISDA Master Agreement, completely isolated, air-gapped and insulated against misadventure occurring in other ISDA Master Agreements the SPV has entered with you relating to other Series.[1]