Template:EUA Annex Delivering Party’s Replacement Cost: Difference between revisions
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{{euaprov|Delivering Party’s Replacement Cost}} | '''{{euaprov|Delivering Party’s Replacement Cost}}''': Means in respect of a failure of {{euaprov|Receiving Party}} to accept delivery of a number of {{euaprov|Allowances}} (the “'''{{euaprov|DPRC Shortfall}}'''”), an amount equal to: | ||
:(i) | :(i) | ||
::(1) the {{euaprov|Allowance Purchase Price}} or {{euaprov|Allowance Strike Price}}, as applicable, as set out in the Confirmation for the relevant {{euaprov|EU Emissions Allowance Transaction}} plus, in those circumstances in which the relevant termination of the parties’ obligations under | ::(1) the {{euaprov|Allowance Purchase Price}} or {{euaprov|Allowance Strike Price}}, as applicable, as set out in the {{euaprov|Confirmation}} for the relevant {{euaprov|EU Emissions Allowance Transaction}} plus, in those circumstances in which the relevant termination of the parties’ obligations under “{{euaprov|Physical Settlement}}” occurs following a {{euaprov|Suspension Event}}, the {{euaprov|Close-out Cost of Carry Amount}}; less | ||
::(2) the price (per Allowance) {{euaprov|Delivering Party}}, acting in a commercially reasonable manner, does or would, in the determination of the Calculation Agent, receive in an arm’s length transaction concluded on the {{euaprov|Final Compliance Date}} for an equivalent number of Allowances of the relevant {{euaprov|Allowance Type}} to be delivered on the {{euaprov|Final Compliance Date}} or, if later, the {{euaprov|Delivery Business Day}} on which Allowances would be delivered in accordance with prevailing market practice under a spot transaction concluded on the {{euaprov|Final Compliance Date}}; multiplied by: | ::(2) the price (per Allowance) {{euaprov|Delivering Party}}, acting in a commercially reasonable manner, does or would, in the determination of the {{euaprov|Calculation Agent}}, receive in an arm’s length transaction concluded on the {{euaprov|Final Compliance Date}} for an equivalent number of {{euaprov|Allowances}} of the relevant {{euaprov|Allowance Type}} to be delivered on the {{euaprov|Final Compliance Date}} or, if later, the {{euaprov|Delivery Business Day}} on which {{euaprov|Allowances}} would be delivered in accordance with prevailing market practice under a spot transaction concluded on the {{euaprov|Final Compliance Date}}; multiplied by: | ||
:(ii) the {{euaprov|DPRC Shortfall}}; plus | :(ii) the {{euaprov|DPRC Shortfall}}; plus | ||
:(iii) interest at the {{euaprov|Default Rate}} for the period from (and including) the {{euaprov|Delivery Date}} to (but excluding) the date of termination in accordance with Part {{euaprov|(d)(ii)}}(2)(B)({{euaprov|Failure to Comply Not Remedied}}) on an amount equal to the product of the {{euaprov|DPRC Shortfall}} and an amount equal to the excess, if any, of the {{euaprov|Allowance Purchase Price}} or {{euaprov|Allowance Strike Price}}, as applicable, over the price determined pursuant to paragraph (i)(2) above. <br> | :(iii) interest at the {{euaprov|Default Rate}} for the period from (and including) the {{euaprov|Delivery Date}} to (but excluding) the date of termination in accordance with Part {{euaprov|(d)(ii)}}(2)(B)({{euaprov|Failure to Comply Not Remedied}}) on an amount equal to the product of the {{euaprov|DPRC Shortfall}} and an amount equal to the excess, if any, of the {{euaprov|Allowance Purchase Price}} or {{euaprov|Allowance Strike Price}}, as applicable, over the price determined pursuant to paragraph (i)(2) above. <br> | ||
Latest revision as of 16:03, 12 July 2022
Delivering Party’s Replacement Cost: Means in respect of a failure of Receiving Party to accept delivery of a number of Allowances (the “DPRC Shortfall”), an amount equal to:
- (i)
- (1) the Allowance Purchase Price or Allowance Strike Price, as applicable, as set out in the Confirmation for the relevant EU Emissions Allowance Transaction plus, in those circumstances in which the relevant termination of the parties’ obligations under “Physical Settlement” occurs following a Suspension Event, the Close-out Cost of Carry Amount; less
- (2) the price (per Allowance) Delivering Party, acting in a commercially reasonable manner, does or would, in the determination of the Calculation Agent, receive in an arm’s length transaction concluded on the Final Compliance Date for an equivalent number of Allowances of the relevant Allowance Type to be delivered on the Final Compliance Date or, if later, the Delivery Business Day on which Allowances would be delivered in accordance with prevailing market practice under a spot transaction concluded on the Final Compliance Date; multiplied by:
- (ii) the DPRC Shortfall; plus
- (iii) interest at the Default Rate for the period from (and including) the Delivery Date to (but excluding) the date of termination in accordance with Part (d)(ii)(2)(B)(Failure to Comply Not Remedied) on an amount equal to the product of the DPRC Shortfall and an amount equal to the excess, if any, of the Allowance Purchase Price or Allowance Strike Price, as applicable, over the price determined pursuant to paragraph (i)(2) above.