Termination Events - ISDA Provision: Difference between revisions

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Termination Events - ISDA Provision (view source)

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{{fullanatopen|isda|{{ISDA 1992 Section 5 TOC}}}}
{{fullanatopen|isda|{{ISDA 1992 Section 5 TOC}}}}
==Termination Events and Events of Default==
{{isdaprov|Termination Events}} and {{isdaprov|Events of Default}} under an {{isdama}} are similar in that when they occur to one party (the {{isdaprov|Affected Party}} or {{isdaprov|Defaulting Party}}) the other may terminate outstanding trades under the agreement. A crucial difference between them is that events of default may give rise to third-party default rights (where the relevant {{isdaprov|Cross Default}} extends to derivatives and trading documents) but generally termination events under an ISDA Master Agreement with another dealer will not.
Termination events are less likely (although sometimes they do) to trigger third-party defaults; however, they often will trigger termination rights that cut across all agreements with one dealer (i.e., {{isdaprov|Default Under Specified Transaction}}).
==={{t|Trick for young players}}: {{isdaprov|Force Majeure Event}}===
==={{t|Trick for young players}}: {{isdaprov|Force Majeure Event}}===
Note that the {{2002ma}} includes a {{isdaprov|Force Majeure Event}}, using language that was already agreed and widely inserted into the {{1992ma}} Schedule prior to its publication. Because this was entered as Section 5(b)(ii), this necessitates some numbering differences between the two versions of the {{isdama}} - a drafting [[trick for young players]] to watch out for.  
Note that the {{2002ma}} includes a {{isdaprov|Force Majeure Event}}, using language that was already agreed and widely inserted into the {{1992ma}} Schedule prior to its publication. Because this was entered as Section 5(b)(ii), this necessitates some numbering differences between the two versions of the {{isdama}} - a drafting [[trick for young players]] to watch out for.  
==Subsections to Section 5(b) {{isdama}}==
:(b) {{isdaprov|Termination Events}}
::(i) {{isdaprov|Illegality}}
::(ii) {{isdaprov|Tax Event}}
::(ii) {{isdaprov|Force Majeure Event}} ([[2002 ISDA Master]] only)
::(iii) {{isdaprov|Tax Event Upon Merger}}
::(iv) {{isdaprov|Credit Event Upon Merger}}
::(v) {{isdaprov|Additional Termination Event}}
:(c) {{isdaprov|Event of Default and Illegality}}


{{anat|isda}}
{{Differences between events of default and termination events}}
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