Template:Isda Tax Event Upon Merger summ

This is you can imagine, a red letter day for ISDA’s crack drafting squad™ who quite outdid itself in the complicated permutations for how to terminate an ISDA Master Agreement should there be a Tax Event or a {{{{{1}}}|Tax Event Upon Merger}}. Things kick off in Section 6(b)(ii) and it really just gets better from there.

So, {{{{{1}}}|Tax Event Upon Merger}} considers the scenario where the coming together of two entites — we assume they hail from different jurisdictions or at least have different practical tax residences — has an unfortunate effect on the tax status of payments due by the merged entity under an existing {{{{{1}}}|Transaction}}.

It introduces a new and unique concept — the “Burdened Party”, being the one who gets slugged with the tax — and who may or may not be the “Affected Party” — in this case the one subject to the merger.