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Section 2(a)(iii) - ISDA Provision: Difference between revisions
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Section 2(a)(iii) - ISDA Provision (view source)
Revision as of 09:31, 28 January 2016
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*Allows the {{isdaprov|Defaulting Party}} to notify of an {{isdaprov|Event of Default}} or {{isdaprov|Potential Event of Default}}. | *Allows the {{isdaprov|Defaulting Party}} to notify of an {{isdaprov|Event of Default}} or {{isdaprov|Potential Event of Default}}. | ||
*That in turn starts the clock running on a period (to be agreed by the parties but likely to be no more than a month) in which the {{isdaprov|Non-defaulting Party}} has to decide what to do. During that period the {{isdaprov|Non-Defaulting Party}} retains its traditional right under {{isdaprov|2(a)(iii)}} to suspend payments under the {{isdama}}. | *That in turn starts the clock running on a period (to be agreed by the parties but likely to be no more than a month) in which the {{isdaprov|Non-defaulting Party}} has to decide what to do. During that period the {{isdaprov|Non-Defaulting Party}} retains its traditional right under {{isdaprov|2(a)(iii)}} to suspend payments under the {{isdama}}. | ||
*upon expiry of that period the {{isdaprov|Event of Default}} no longer qualifies as a [[condition precedent]] to payment under the Section 2(a)(iii), so if the {{isdaprov|Non-Defaulting Party}} has not exercised its right to terminate, it must resume performance of the transaction. | *upon expiry of that period the {{isdaprov|Event of Default}} no longer qualifies as a [[condition precedent]] to payment under the Section {{isdaprov|2(a)(iii)}}, so if the {{isdaprov|Non-Defaulting Party}} has not exercised its right to terminate, it must resume performance of the transaction. | ||