Template:Nutshell Equity Derivatives 12.9(b)(v): Difference between revisions

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Created page with "{{eqderivprov|12.9(b)(v)}} If "'''{{eqderivprov|Increased Cost of Stock Borrow}}'''" applies, the {{eqderivprov|Hedging Party}} may tell the {{eqderivprov|Non-Hedging Party}}..."
 
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{{eqderivprov|12.9(b)(v)}} If "'''{{eqderivprov|Increased Cost of Stock Borrow}}'''" applies, the {{eqderivprov|Hedging Party}} may tell the {{eqderivprov|Non-Hedging Party}} that an {{eqderivprov|Increased Cost of Stock Borrow}} has  happened and that it will make a {{eqderivprov|Price Adjustment}} to the {{eqderivprov|Transaction}}.  
::{{eqderivprov|12.9(b)(v)}} If “'''{{eqderivprov|Increased Cost of Stock Borrow}}'''” applies, the {{eqderivprov|Hedging Party}} may tell the {{eqderivprov|Non-Hedging Party}} that an {{eqderivprov|Increased Cost of Stock Borrow}} has  happened and that it will make a {{eqderivprov|Price Adjustment}} to the {{eqderivprov|Transaction}}.  
 
::Within 2 {{eqderivprov|Scheduled Trading Days}} of that notice the {{eqderivprov|Non-Hedging Party}} must:
Within 2{{eqderivprov|Scheduled Trading Days}} of that notice the {{eqderivprov|Non-Hedging Party}} must:
:::(A) amend the {{eqderivprov|Transaction}} to make the {{eqderivprov|Price Adjustment}},  
:(A) amend the {{eqderivprov|Transaction}} to make the {{eqderivprov|Price Adjustment}},  
:::(B) pay the {{eqderivprov|Hedging Party}} the {{eqderivprov|Price Adjustment}} or  
:(B) pay the {{eqderivprov|Hedging Party}} the {{eqderivprov|Price Adjustment}} or  
:::(C) terminate the {{eqderivprov|Transaction}} as of that second {{eqderivprov|Scheduled Trading Day}}.  
:(C) terminate the {{eqderivprov|Transaction}} as of that second {{eqderivprov|Scheduled Trading Day}}.  
::Within this period, the {{eqderivprov|Non-Hedging Party}} may lend the Hedging Party, the necessary {{eqderivprov|Hedging Shares}} at no more than the {{eqderivprov|Initial Stock Loan Rate}}.
 
::Absent such an election the {{eqderivprov|Hedging Party}} may terminate the {{eqderivprov|Transaction}}. On any termination of the {{eqderivprov|Transaction}}, the {{eqderivprov|Determining Party}} will determine the {{eqderivprov|Cancellation Amount}}. <br>
Within this period, the {{eqderivprov|Non-Hedging Party}} may lend or procure a loan to the Hedging Party, of an amount of {{eqderivprov|Shares}} equal to the {{eqderivprov|Hedging Shares}} at or less than the {{eqderivprov|Initial Stock Loan Rate}} subject to the conditions below.
 
If the {{eqderivprov|Non-Hedging Party}} doesn't make an election in that period the {{eqderivprov|Hedging Party}} may terminate the {{eqderivprov|Transaction}}. If either party terminates the {{eqderivprov|Transaction}}, the {{eqderivprov|Determining Party}} will determine the {{eqderivprov|Cancellation Amount}}. <br />

Latest revision as of 17:15, 27 March 2020

12.9(b)(v) If “Increased Cost of Stock Borrow” applies, the Hedging Party may tell the Non-Hedging Party that an Increased Cost of Stock Borrow has happened and that it will make a Price Adjustment to the Transaction.
Within 2 Scheduled Trading Days of that notice the Non-Hedging Party must:
(A) amend the Transaction to make the Price Adjustment,
(B) pay the Hedging Party the Price Adjustment or
(C) terminate the Transaction as of that second Scheduled Trading Day.
Within this period, the Non-Hedging Party may lend the Hedging Party, the necessary Hedging Shares at no more than the Initial Stock Loan Rate.
Absent such an election the Hedging Party may terminate the Transaction. On any termination of the Transaction, the Determining Party will determine the Cancellation Amount.
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