Template:Isda 3 summ

If you want any special extra {{{{{1}}}|Representations}} over and above the boring ones in Section {{{{{1}}}|3}}, stick them in {{{{{1}}}|Part 5}} of the {{{{{1}}}|Schedule}}, or maybe a master confirmation, be sure to label them “{{{{{1}}}|Additional Representation}}s” and, if the fancy catches you, have the representor deem them repeated on the commencement of any new {{{{{1}}}|Transaction}}, the anniversary of the ISDA Master Agreement or whenever, in a moment of weakness, insecurity or indolence, your operations team feels like reaching out to the counterparty and asking it to say them again. They’ll love you for it.

Yes, Misrepresentation is an Event of Default

A breach of any of these {{{{{1}}}|Representations}} when made (or deemed repeated) (except a Payer or {{{{{1}}}|Payee Tax Representation}}, but including any {{{{{1}}}|Additional Representation}} is an {{{{{1}}}|Event of Default}}. Eventually.

Additional Representations as Additional Termination Events

In the case of {{{{{1}}}|Additional Representation}}s this can be somewhat drastic, especially if your {{{{{1}}}|Additional Representation}} is {{{{{1}}}|Transaction}}-specific (for example India, China and Taiwan investor status reps for equity derivatives), and it would seem churlish to close out a whole ISDA Master Agreement on their account.

Then again, show me a swap dealer who would detonate an entire swap trading relationship with a solvent counterparty and I’ll show you a moron — but, as we know, opposing legal eagles operate on the presumption that everyone else is a moron and thus tend to be immune to such grand rhetorical flourishes, and regard such appeals to basic common sense as precisely such flourishes, so don’t expect that argument to carry the day, however practically true it may be.

Instead, expect to encounter leagues of agonising drafting, but there are easier roads to travel. Try:

These representations will be {{{{{1}}}|Additional Representation}}s, except that where they prove to be materially incorrect or misleading when made or repeated it will not be an {{{{{1}}}|Event of Default}} but an {{{{{1}}}|Additional Termination Event}}, where the {{{{{1}}}|Transaction}}s in question are the {{{{{1}}}|Affected Transaction}}s and the misrepresenting party is the sole {{{{{1}}}|Affected Party}}.