2016 ISDA Credit Support Annex (VM) (New York law)
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Paragraph 7 in a Nutshell™
Use at your own risk, campers!
Full text of Paragraph 7
===Paragraph 7 Events of Default===
For purposes of Section 5(a)(iii)(1) of this Agreement, an Event of Default will exist with respect to a party if:
- 7(i) that party fails (or fails to cause its Custodian (VM)) to make, when due, any Transfer of Eligible Collateral (VM), Posted Collateral (VM) or the Interest Payment (VM), as applicable, required to be made by it and that failure continues for two Local Business Days after notice of that failure is given to that party;
- 7(ii) that party fails to comply with any restriction or prohibition specified in this Annex with respect to any of the rights specified in Paragraph 6(c) and that failure continues for five Local Business Days after notice of that failure is given to that party; or
- 7(iii) that party fails to comply with or perform any agreement or obligation other than those specified in Paragraphs 7(i) and 7(ii) and that failure continues for 30 days after notice of that failure is given to that party.
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Content and comparisons
Quite different to the default provision under the 2016 VM CSA, because like all NY CSAs, the 2016 NY Law VM CSA version is not a Transaction. This means it needs to have its own Events of Default clause, rather than piggy-backing off the ISDA Master Agreement. It also has its own grace period, which defaults to two Local Business Days.
Summary
Quite different to the default provision under the 2016 VM CSA, because the NY version is not a Transaction. This means it needs to have its own Events of Default clause, rather than piggy-backing off the ISDA Master Agreement. It also has its own grace period, which defaults to two Local Business Days.
See also
Template:M sa 2016 NY CSA 7
References