ISDA Anatomy™
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See ISDA Comparison for a comparison between the 1992 ISDA and the 2002 ISDA.
The Varieties of ISDA Experience
Subject 2002 (wikitext) 1992 (wikitext) 1987 (wikitext)
Preamble Pre Pre Pre
Interpretation 1 1 1
Obligns/Payment 2 2 2
Representations 3 3 3
Agreements 4 4 4
EODs & Term Events 5 Events of Default: FTPDBreachCSDMisrepDUSTCross DefaultBankruptcyMWA Termination Events: IllegalityFMTax EventTEUMCEUMATE 5 Events of Default: FTPDBreachCSDMisrepDUSTCross DefaultBankruptcyMWA Termination Events: IllegalityTax EventTEUMCEUMATE 5 Events of Default: FTPDBreachCSDMisrepDUSSCross DefaultBankruptcyMWA Termination Events: IllegalityTax EventTEUMCEUM
Early Termination 6 Early Termination: ET right on EODET right on TEEffect of DesignationCalculations; Payment DatePayments on ETSet-off 6 Early Termination: ET right on EODET right on TEEffect of DesignationCalculationsPayments on ETSet-off 6 Early Termination: ET right on EODET right on TEEffect of DesignationCalculationsPayments on ET
Transfer 7 7 7
Contractual Currency 8 8 8
Miscellaneous 9 9 9
Offices; Multibranch Parties 10 10 10
Expenses 11 11 11
Notices 12 12 12
Governing Law 13 13 13
Definitions 14 14 14
Schedule Schedule Schedule Schedule
Termination Provisions Part 1 Part 1 Part 1
Tax Representations Part 2 Part 2 Part 2
Documents for Delivery Part 3 Part 3 Part 3
Miscellaneous Part 4 Part 4 Part 4
Other Provisions Part 5 Part 5 Part 5
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A checklist, should you need one for an affiliate guarantee, offered up as a credit support document for an ISDA Master Agreement or other master trading arrangement.

ISDA alert: look out for Transaction-specific guarantees

As well as the guarantee checklist below - which is specific to the guarantee as a guarantee, there is an ISDA-specific trick to look out for. Beware of Transaction-specific guarantees.

Thanks to the curious architecture of the ISDA, transaction-specific guarantees, even if formally valid and enforceable per the below, won’t work because at the time when you invoke them, the Transaction has been terminated and its exposure aggregated under the master agreement proper. The reasons for this are complicated, so rather than rehearse them here, there is a separate article for them, here.

See also

Guarantee Checklist
Issue Narrative Check
Consideration Is there consideration?
Permanence Is it unconditional, irrevocable and continuing?
Unaffected Is it unaffected by:

Interim payments

Obligor’s insolvency

Obligor’s lack of capacity and authority

Amendment or discharge of obligor’s obligations

Beneficiary’s waiver or forbearance to the obligor

Other customary grounds for discharge of guarantees

Punctual performance Does it guarantee the obligor’s “punctual performance”?
Independence/other sureties Is it independent of any other credit support arrangement between the beneficiary and obligor and unaffected by any other security or rights beneficiary may have against the obligor?
Indemnity Is there an indemnity against beneficiary’s costs of enforcement of guaranteed obligations?
Is there an indemnity wrt the value of obligations which are void/unenforceable against the obligor?
Currency and payment Must payment must be in immediately available funds in the currency of the underlying obligations?
If not, is there a currency indemnity?
No set-off or counterclaim Is set-off or counterclaim against money the beneficiary owes the guarantor excluded?
Interest Must the guarantor pay interest from the date of demand until payment in full?
Suspense account May beneficiary place amounts beneficiary into a suspense account pending satisfaction in full?
Demand process May beneficiary demand without first taking steps vs the obligor?
No discharge if prejudice May beneficiary decline to discharge the guarantee if it might prejudice its claim under insolvency laws?
Reinstatement If beneficiary discharges, is guarantor’s liability reinstated should obligor’s payments be set aside?
Guarantor’s rights versus obligor Must Guarantor obtain beneficiary’s consent before taking action against obligor until guaranteed obligations are fully paid?
Must guarantor hold sums it receives from obligor pending satisfaction to beneficiary’s order
Tax gross-up Must guarantor gross up if subject to withholding on guarantee payments?
Not a Transaction-specific guarantee (when a credit support document under an ISDA Master Agreement, ensure it guarantees the obligor’s obligations under the ISDA Master Agreement itself, not just specific Transactions under the ISDA.