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1987 ISDA Interest Rate and Currency Exchange Agreement: Difference between revisions
1987 ISDA Interest Rate and Currency Exchange Agreement (view source)
Revision as of 12:54, 10 August 2012
, 10 August 2012→Close-out Netting under the {{1987ma}}
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**it happens by default (in the {{1992ma}} and subsequently it has to be elected, and only would be elected in those jurisdictions where it was needed to ensure [[close-out netting]]) | **it happens by default (in the {{1992ma}} and subsequently it has to be elected, and only would be elected in those jurisdictions where it was needed to ensure [[close-out netting]]) | ||
**it happens by reference to '''all''' of the limbs of the Bankruptcy definition, including those which are observable and definitive. AET shouldn't kick in simply where a party "takes steps in furtherance of" an insolvency filing - it should only happen at the point of that actual insolvency filing. | **it happens by reference to '''all''' of the limbs of the Bankruptcy definition, including those which are observable and definitive. AET shouldn't kick in simply where a party "takes steps in furtherance of" an insolvency filing - it should only happen at the point of that actual insolvency filing. | ||
* | **That is to say the second sentence of Section 6(a) (see below) deems the occurrence of an {{isdaprov|Early Termination Date}} ''automatically'' upon the occurrence of ''any'' event falling within the Bankruptcy {{isdaprov|Event of Default}}. | ||
By contrast, {{isdaprov|Automatic Early Termination}} under the {{1992ma}} and {{2002ma}}, if elected, does not apply to those events that are uncertain as to the precise time of their occurrence. Therefore, the enforceability of {{isdaprov|Automatic Early Termination}} in the {{1992ma}} and the {{2002ma}} cannot be called into question on the basis of the uncertainty created by the inclusion of the events in the {{1992ma}} and {{2002ma}} equivalent to those in the {{1987ma}} referred to above. | By contrast, {{isdaprov|Automatic Early Termination}} under the {{1992ma}} and {{2002ma}}, if elected, does not apply to those events that are uncertain as to the precise time of their occurrence. Therefore, the enforceability of {{isdaprov|Automatic Early Termination}} in the {{1992ma}} and the {{2002ma}} cannot be called into question on the basis of the uncertainty created by the inclusion of the events in the {{1992ma}} and {{2002ma}} equivalent to those in the {{1987ma}} referred to above. | ||