Financial Services Law: In the matter of Lehman Brothers International (Europe) (CA) 14/3/13

The ‘value clean’ principle established in relation to the 1992 ISDA Master Agreement had not been preserved by the changes to the closing out provisions introduced by s. 14 of the 2002 ISDA Master Agreement. The provisions of a side letter agreement entered into alongside certain Intercopmany Transactions were therefore ‘material terms’ which had to be taken into account within the definition of ‘Close-out Amount’.