Events of Default
Events of default, which permit early termination of all outstanding transactions (some agreements allow for termination of some but not all transactions), typically include:

• Failure to Pay or Deliver
  This is typically a signal of extreme counterparty distress requiring almost immediate termination. A short grace period (e.g., two business days) is sometimes given to allow for payment in cases of error or oversight.
• Nonpayment Breach of the Agreement
  Except with respect to certain sensitive obligations, a cure period is usually given (e.g., 30 days after notice). Longer cure periods sometimes are negotiated where cure is sought diligently and is reasonably promptly forthcoming.
• Material Inaccuracy of any Representations or Warranty as of the Date Made
  A short cure period sometimes is granted if the matter is capable of a cure.
• Credit Support Failure
  This is the failure to supply any required credit support (including payment of collateral or effectiveness of a guarantee), or the failure of a security interest to be perfected.
• Specified Transaction Default
  The master agreement may provide that a default in any specified transaction (a swap, forward, option, or other transaction) between two parties will be deemed a default in another transaction between the parties. Similarly, the agreement may also provide that if one party finds itself in a situation in which the terms of any specified transaction either become subject to acceleration, or actually are accelerated, then a default will automatically be triggered in another transaction. These provisions may apply not only to the two parties, but also to any third parties providing credit support, or any other specified entity.
• General Cross-Default Provisions
  This refers to the occurrence of a default (payment, covenant, or other) by the counterparty, its credit support provider, or a related specified entity under certain agreements with third parties. Often this is limited to agreements for borrowed money in excess of a specified principal amount. This may be written as a cross-default, cross-accelerable, or cross-acceleration provision.
• Merger Events
  This may be triggered by a merger or transfer of all or substantially all assets if (a) the merging party´s or transferee´s obligations under the agreement (or credit support document) are not assumed either by operation of law or by written instrument reasonably satisfactory to the other party, or (b) the creditworthiness of the counterparty is affected negatively by the event (an objective or a subjective measurement can be used).
• Bankruptcy or Insolvency Events
  The provision is usually broadly written to cover inability to pay debts as they become due, bankruptcy petitions or proceedings, receiverships, or other variations that may be applicable based on the country or industry of the counterparty. Involuntary events may provide some grace period.
• Other
  Other events of default that are sometimes used are based on a downgrade in the counterparty´s credit rating, a change in control, or material adverse change in the financial condition (or prospects) of the counterparty.

Termination Events
Termination events, which allow for early termination of only the affected transactions, often include:

• Illegality
  An illegality occurs if a change in law or regulation (or an official interpretation thereof) makes it illegal for either party to perform its obligations under a transaction.
• Tax Event
  A tax event occurs if a withholding tax is imposed on a transaction.
• Tax Event Upon Merger
  A tax event upon merger occurs if a merger results in the imposition of a withholding tax on a transaction.
• Credit Event Upon Merger
  A credit event upon merger is sometimes a termination event rather than an event of default.