Template:M summ 1992 ISDA 5(b)(i): Difference between revisions
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==1992 User Guide== | ===1992 User Guide=== | ||
Section {{isda92prov|5(b)(i)}} provides that a {{isda92prov|Termination Event}} will occur if it becomes unlawful for a party (or if relevant its {{isda92prov|Credit Support Provider}}) to: | Section {{isda92prov|5(b)(i)}} provides that a {{isda92prov|Termination Event}} will occur if it becomes unlawful for a party (or if relevant its {{isda92prov|Credit Support Provider}}) to: | ||
*make or receive a payment or delivery | *make or receive a payment or delivery | ||
Revision as of 16:00, 26 February 2020
1992 User Guide
Section 5(b)(i) provides that a Termination Event will occur if it becomes unlawful for a party (or if relevant its Credit Support Provider) to:
- make or receive a payment or delivery
- comply with any material provision of a 1992 ISDA or
- perform under a Credit Support Document.
The party to whom the Illegality has occurred will be the “Affected Party”. This Termination Event excludes breach by a party of its Section 4(b) obligation to maintain authorizations necessary under a 1992 ISDA or any Credit Support Document. Any such breach thus will be treated as an Event of Default and not an Illegality.
This Termination Event has been modified from the 1987 ISDA to refer to physically-settled transactions and to replace the reference to “Specified Entity” in the corresponding provision of the 1987 ISDA with “Credit Support Provider” because clause (2) of Illegality relates to Credit Support Documents.
Section 5(c) provides that an Event of Default with is also an Illegality will be treated as an Illegality.