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| {{tocbuilder|ISDA|2002|2(d)}} | | {{newisdamanual|2(d)|}} |
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| {{isdasnap|2(d)(i)}}
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| {{isdasnap|2(d)(ii)}}
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| ==Commentary==
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| Observant and diligent scholars will notice that these two clauses are, more or less, identical.
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| Observant and less obedient scholars will remark how much of a pig's ear the ISDA drafting committee can make of drafting a relatively simple concept and, given a once-in-a-decade opportunity to improve its first attempt in the {{1992ma}}, how in 2002 the combined intellectual might of ISDA, its members, friends and relations, and their divers counsel, retinue and entourage, couldn't.
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| This is, therefore, the apex of all possible derivatives drafting. Make you feel great to be alive, doesn't it.
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| But here: let *me* have a go.
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| {{isdaprov|2(d)(i)}} Gross-Up. All payments will be made deduction for {{isdaprov|Tax}} unless deduction is required by applicable law. Where a party (X) is obliged to deduct for {{isdaprov|Tax}} it will promptly: <br>
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| :(1) notify the other party (Y); <br>
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| :(2) pay the full amount of {{isdaprov|Tax}} required (including on any grossed up amount required under this Section);
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| :(3) forward evidencing such payment to Y; and <br>
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| :(4) where the {{isdaprov|Tax}} is an {{isdaprov|Indemnifiable Tax}}, pay to Y such additional amount as is necessary to ensure that the net amount received by Y (free of {{isdaprov|Indemnifiable Taxes}}) will equal the full amount Y would have received had there been no such deduction ("'''gross up'''"). <br>
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| However, X will '''not''' be required to gross up any tax which would not be required but for:―<br>
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| :(A) Y's failure to comply with Section {{isdaprov|4(a)(i)}}, {{isdaprov|4(a)(iii)}} or {{isdaprov|4(d)}}; or
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| :(B) Y's breach of any Section {{isdaprov|3(f)}} representation (unless such breach would not have occurred but for (I) any governmental action ''after'' entry into a Transaction or (II) a {{isdaprov|Change in Tax Law}}.
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| {{isdaanatomy}}
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