Template:Isda 2(a)(iii) summ

Flawed assets generally

{{Flawed asset capsule{{{1}}}}}

Does not apply to {{{{{1}}}|Termination Events}}

Since most ISDA Master Agreements that reach the life support machine in an ICU get there by dint of a {{{{{1}}}|Failure to Pay}} or {{{{{1}}}|Bankruptcy}} this does not, in point of fact, amount to much, but it is worth noting that while {{{{{1}}}|Event of Default}}s — and even events that are not yet but with the passing of time might become {{{{{1}}}|Events of Default}} — can trigger a {{{{{1}}}|2(a)(iii)}} suspension, a mere Section {{{{{1}}}|5(b)}} {{{{{1}}}|Termination Event}} — even a catastrophic one like an {{{{{1}}}|Additional Termination Event}} (such as a NAV trigger, key person event or some such) — cannot. This might rile and unnerve credit officers, by nature an easily perturbed lot, but given our arguments below for what a train-wreck the whole {{{{{1}}}|2(a)(iii)}} thing is, those of stabler personalities will consider this basically a good thing.

Nevertheless the JC has seen valiant efforts to insert {{{{{1}}}|Additional Termination Events}} to section {{{{{1}}}|2(a)(iii)}}, and — quel horreur — Potential Additional Termination Events, a class of things that do not exist outside the laboratory, and must therefore be defined. All this for the joy of invoking a clause that doesn’t make any sense in the first place.

“Some things are better left unsaid,” said no ISDA ninja ever.