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Template:Isda 5(a)(ii) summ: Difference between revisions
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Amwelladmin (talk | contribs) (Created page with "A failure to perform any agreement, if not cured within 30 days, is an {{{{{1}}}|Event of Default}}, except for those failures which ''already'' have their own special {{{{{1}}}|Event of Default}} (i.e., {{{{{1}}}|Failure to Pay or Deliver}}, under Section {{{{{1}}}|5(a)(i)}}), those that relate to a pre-existing default (for example, default interest on unpaid amounts) and those that only bear on the “defaulting” party’s tax position, meaning that non-performance...") |
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So rather than empowering a {{{{{1}}}|Non-defaulting Party}}, the addition of a narrow definition of what counts as repudiation makes their avenue of redress that teeny bit narrower. Doubtful it has ever made a difference, but — well, they said that about LIBOR didn’t they. | So rather than empowering a {{{{{1}}}|Non-defaulting Party}}, the addition of a narrow definition of what counts as repudiation makes their avenue of redress that teeny bit narrower. Doubtful it has ever made a difference, but — well, they said that about LIBOR didn’t they. | ||
===== | ===== Hierarchy of Events===== | ||
Note that a normal Section 5(a)(ii)(1) {{{{{1}}}|Breach of Agreement}} that also amounts to a Section 5(b)(i) {{{{{1}}}|Illegality}} or a Section 5(b)(ii) {{{{{1}}}|Force Majeure}} {{{{{1}}}|Termination Event}} will, thanks to section {{{{{1}}}|5(c)}}, be treated as the latter, but a ''[[Repudiatory breach|repudiatory]]'' {{{{{1}}}|Breach of Agreement}} under section {{{{{1}}}|5(a)(ii)}}(2) willl not enjoy the same leniency. If you have repudiated your contract, the fact that there happens to be a concurrent {{{{{1}}}|Illegality}} — it is hard to see how a repudiatory breach could be an {{{{{1}}}|Illegality}} ''in itself'' — will not save you from the full enormity of section {{{{{1}}}|5(a)(ii)}} {{{{{1}}}|Event of Default}} style close out. | Note that a normal Section 5(a)(ii)(1) {{{{{1}}}|Breach of Agreement}} that also amounts to a Section 5(b)(i) {{{{{1}}}|Illegality}} or a Section 5(b)(ii) {{{{{1}}}|Force Majeure}} {{{{{1}}}|Termination Event}} will, thanks to section {{{{{1}}}|5(c)}}, be treated as the latter, but a ''[[Repudiatory breach|repudiatory]]'' {{{{{1}}}|Breach of Agreement}} under section {{{{{1}}}|5(a)(ii)}}(2) willl not enjoy the same leniency. If you have repudiated your contract, the fact that there happens to be a concurrent {{{{{1}}}|Illegality}} — it is hard to see how a repudiatory breach could be an {{{{{1}}}|Illegality}} ''in itself'' — will not save you from the full enormity of section {{{{{1}}}|5(a)(ii)}} {{{{{1}}}|Event of Default}} style close out. | ||