Notice (of Termination Event) - ISDA Provision

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2002 ISDA Master Agreement
A Jolly Contrarian owner’s manual

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Events of Default: 5(a)(i) Failure to Pay or Deliver5(a)(ii) Breach of Agreement5(a)(iii) Credit Support Default5(a)(iv) Misrepresentation5(a)(v) Default Under Specified Transaction5(a)(vi) Cross Default5(a)(vii) Bankruptcy5(a)(viii) Merger without Assumption
Termination Events: 5(b)(i) Illegality5(b)(ii) Force Majeure Event5(b)(iii) Tax Event5(b)(iv) Tax Event Upon Merger5(b)(v) Credit Event Upon Merger5(b)(vi) Additional Termination Event

Index — Click ᐅ to expand:

Section 6(b)(i) in a Nutshell
Use at your own risk, campers!

6(b)(i) Notice. Upon becoming aware of a Termination Event the Affected Party will promptly give the other party with reasonable details of it and each Affected Transaction (or make reasonable efforts to so, if it is a Force Majeure Event).

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Full text of Section 6(b)(i)

6(b)(i) Notice. If a Termination Event other than a Force Majeure Event occurs, an Affected Party will, promptly upon becoming aware of it, notify the other party, specifying the nature of that Termination Event and each Affected Transaction, and will also give the other party such other information about that Termination Event as the other party may reasonably require. If a Force Majeure Event occurs, each party will, promptly upon becoming aware of it, use all reasonable efforts to notify the other party, specifying the nature of that Force Majeure Event, and will also give the other party such other information about that Force Majeure Event as the other party may reasonably require.

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Related agreements and comparisons

Related Agreements
Click here for the text of Section 6(b)(i) in the 1992 ISDA
Comparisons
Click to compare this section in the 1992 ISDA and 2002 ISDA.

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Content and comparisons

Updated in 2002 with special pleadings relating to the newly-introduced Force Majeure Termination Event.
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Summary

Note the difficulty of practical compliance with this provision, given a sizeable ISDA portfolio, and the requirement for actively monitoring not only standard Termination Events, but also Additional Termination Events, which may be counterparty or even Transaction-specific.

Be aware of the notices provision of the ISDA Master Agreement, especially if you’re using a 1992 ISDA and you were thinking of serving by emailNatWest Bank could tell you a thing or two about that, as this lengthy article explains — or if the world happens to be in the grip of madness, hysteria, pandemic or something equally improbable[1] like an alien invasion.
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See also

Template:M sa 2002 ISDA 6(b)(i)
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References

  1. “The chances of anything coming from Mars were a million-to-one,” he said. Yet, still they came.