The 2002 ISDA Master Agreement

By Jean S. Chin, Joseph P. Collins, Pamela J. Sackmann and Andrés E. Aguila

The International Swaps and Derivatives Association, Inc. ("ISDA") has published a new form of Master Agreement (the "2002 Form") to replace the prior 1992 form of Master Agreement (the "1992 Form"). The 2002 Form is a major "rewrite" of the 1992 Form, with most of the substantive changes falling into several types: (i) revising close-out calculations (early termination amounts), (ii) dealing with force majeure and illegality events, (iii) tightening credit-related provisions, and (iv) incorporating various provisions that have become "market practice" modifications to the 1992 Form. In accomplishing the "rewrite," ISDA has substantially increased the length of the form Master Agreement.