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| ==Section 6(e)(i) {{1992ma}}==
| | #redirect[[Payments on Early Termination - ISDA Provision]] |
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| (i) '''Events of Default'''. If the {{isdaprov|Early Termination Date}} results from an {{isdaprov|Event of Default}}: —
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| (1) ''{{isdaprov|First Method}} and {{isdaprov|Market Quotation}}''. If the First Method and Market Quotation apply, the
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| {{isdaprov|Defaulting Party}} will pay to the {{isdaprov|Non-defaulting Party}} the excess, if a positive number, of (A) the
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| sum of the {{isdaprov|Settlement Amount}} (determined by the Non-defaulting Party) in respect of the
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| {{isdaprov|Terminated Transactions}} and the {{isdaprov|Termination Currency Equivalent}} of the {{isdaprov|Unpaid Amounts}} owing
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| to the Non-defaulting Party over (B) the Termination Currency Equivalent of the Unpaid Amounts
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| owing to the Defaulting Party.
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|
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| (2) ''{{isdaprov|First Method}} and {{isdaprov|Loss}}''. If the First Method and Loss apply, the Defaulting Party will pay
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| to the Non-defaulting Party, if a positive number, the Non-defaulting Party’s Loss in respect
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| of this Agreement.
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|
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| (3) ''{{isdaprov|Second Method and Market Quotation}}''. If the Second Method and Market Quotation apply,
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| an amount will be payable equal to (A) the sum of the {{isdaprov|Settlement Amount}} (determined by the
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| Non-defaulting Party) in respect of the {{isdaprov|Terminated Transactions}} and the {{isdaprov|Termination Currency Equivalent}}
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| of the {{isdaprov|Unpaid Amounts}} owing to the Non-defaulting Party less (B) the Termination
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| Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party. If that amount is
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| a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative
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| number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting
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| Party.
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|
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| (4) ''{{isdaprov|Second Method}} and {{isdaprov|Loss}}''. If the Second Method and Loss apply, an amount will be payable
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| equal to the Non-defaulting Party’s Loss in respect of this Agreement. If that amount is a
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| positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative
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| number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting
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| Party.
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| ==Section 6(e)(i) {{2002ma}}==
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| ==Commentary==
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| Note the effect of this is that all transactions are terminated and the recourse is to a net sum under Section 6(e) of the master agreement - NOT under the transations. Therefore, if your [[credit support]] (particularly [[guarantee]]s or [[LC|letters of credit]]) explicitly references the Transaction, you may lose any credit support at precisely the point you want to rely on it. Further commentary on the [[Guarantee]] page.
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| {{isdaanatomy}}
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| *[[Guarantee]]
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