ISDA Master Agreement and Credit Support Annex: Negotiation Strategies

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Program Agenda

 

A. Introduction and Negotiating the Schedule to the 2002 ISDA Master Agreement – 1 Hour, 30 Minutes

        This session will focus on key issues that firms typically negotiate in their Schedule to the 2002 Agreement.

        Frequently negotiated Schedule provisions will be discussed:

  • Elections (e.g., Governing Law, Termination Currency)
  • Automatic Early Termination – pros and cons
  • Specified Entities for 5(a)(v), 5(a)(vi), 5(a)(vii) and 5(b)(iv)
  • Credit Support Documents and Credit Support Providers
  • Expansions and contractions of defined terms (e.g., Specified Transactions, Specified Indebtedness)
  • Cross Default vs cross-acceleration and Threshold Amounts
  • Netting of Payments
  • Agreement to Deliver Documents
    • What types of documents do parties request?
    • The timing of delivery
  • Payer and Payee Tax Representations
  • Credit Event Upon Merger
  • Process Agent – When should one be appointed?

     Fabien Carruzzo, Partner, Kramer Levin Naftalis & Frankel LLP
     Ian Cuillerier, Partner, White & Case LLP
     Matthew Klein, Senior Counsel, The Vanguard Group, Inc.
     Steve Milankov, Assistant General Counsel and Senior Trading Counsel, Pershing Square Capital Management, L.P.
     Frederick O. Quenzer, Assistant General Counsel, ISDA

 

B. Negotiating the Schedule to the 2002 ISDA Master Agreement (continued) – 1 Hour, 32 Minutes

  • Additional Termination Events – what are these events and why do parties include these? (e.g., Ratings Downgrades, Net Asset Value Triggers, Keyman Clauses, Credit Agreement events)
  • Multibranch Party; Offices
  • Transfer – Considerations for modifying Section 7
  • Calculation Agent – Possible inclusion of dispute rights and references to ISDA Determinations Committees
  • Scope of Agreement
  • FATCA and 871(m) provisions
  • Local law considerations
  • Limitations on rights to designate an Early Termination Date or suspend payments
  • Additional Representations
  • Other Provisions (e.g., Waiver of Jury Trial, Recording of Conversations, ERISA provisions)
  • Amending Master Agreements by an ISDA Protocol

     Fabien Carruzzo, Partner, Kramer Levin Naftalis & Frankel LLP
     Ian Cuillerier, Partner, White & Case LLP
     Matthew Klein, Senior Counsel, The Vanguard Group, Inc.
     Steve Milankov, Assistant General Counsel and Senior Trading Counsel, Pershing Square Capital Management, L.P.

 

C. Negotiating Paragraph 13 to the ISDA 2016 Credit Support Annex for Variation Margin (VM) (Security Interest – New York Law) – 1 Hour, 30 Minutes

        This session will examine terms specified and added to Paragraph 13, including:

  • A basic overview of how uncleared margin rules will impact CSAs
  • Covered Transactions
  • Eligible Collateral and Valuation Percentages
  • Minimum Transfer Amounts
  • Ratings Ladders
  • Valuation Time and Valuation Date
  • Valuation Agent
  • Specified Conditions
  • Notification Time
  • Transfer Timing – What changes can market participants make?
  • Resolution Time

     Ilene K. Froom, Partner, Reed Smith LLP
     Miki Navazio, Partner, Seward & Kissel LLP
     Tess Weil, Partner, Purrington Moody Weil LLP

 

D. Negotiating Paragraph 13 to the ISDA 2016 Credit Support Annex for Variation Margin (VM) (Security Interest – New York Law) (continued) – 1 Hour, 4 Minutes

  • Value of Collateral
  • Using Posted Collateral
  • Custodians
  • The Interest Rate and timing of Interest Payments
  • Interest Adjustment
  • Negative Interest
  • Distributions
  • Credit Support Offsets
  • Rights and Remedies of the Secured Party
  • Rights and Remedies of the Pledgor
  • Other Provisions
  • Variation Margin Segregation
  • Terms for non-netting counterparties
  • Independent Amount, using the Independent Amount (IA) Provisions
  • Independent Amount Segregation
  • The ISDA 2013 Account Control Agreement

     Ilene K. Froom, Partner, Reed Smith LLP
     Miki Navazio, Partner, Seward & Kissel LLP

 

COURSE SAMPLE

 

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