Specified Entity - ISDA Provision
In gory detail
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1992 ISDA |
2002 ISDA |
Commentary
Note the reference in relation to (a) Section 5(a) Termination Events (like DUST for example), and (b) the "Absence of Litigation" representation in Section 3(c) of the 2002 ISDA.
A Specified Enity is any affiliate (or, in theory at any rate, even a non-affiliate) of a counterparty to an ISDA Master Agreement which is designated in the relevant Schedule.
It is relevant to the definition of Cross Default and Default under Specified Transaction in that it widens the effect of those provisions to include defaults by the parties specified.
Tricks for the young players - Nominating Specified Entities for yourself isn't all bad
Specified Entity widens the scope of those provisions also to include defaults by Specified Entities under contracts with your Specified Entities - so there *is* some benefit to naming your affiliates, friends and relations as Specified Entities. But given how unlikely you are to be actually monitoring how a counterparty performs with an affiliate, it's more of a false comfort than a real one.