Margin lock-up: Difference between revisions
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{{a|pb|}}Notwithstanding all the [[Event of Default|apocalyptic rights]] I have given myself in our {{pbprov|prime brokerage agreement}}, I agree not to increase my [[initial margin]] requirements on any product or boost any of my [[interest rate|financing rates]] with out X days notice, or any of the apocalyptic events I mention in this here [[margin lock-up]] — let’s call these | {{a|pb|}}Notwithstanding all the [[Event of Default|apocalyptic rights]] I have given myself in our {{pbprov|prime brokerage agreement}}, I agree not to increase my [[initial margin]] requirements on any product or boost any of my [[interest rate|financing rates]] with out X days notice, or any of the apocalyptic events I mention in this here [[margin lock-up]] — let’s call these [[lockup termination event]]s — have come about. | ||
===Lockup termination events=== | ===Lockup termination events=== | ||
[[Lockup termination event]]s should be more sensitive than outright EODs and ATEs under the ISDA and PB docs. In practice, currently, they tend not to be. | |||
Seeing as outright [[Event of default|default]] justifies total [[close-out]] of the whole relationship; terminating a lockup — which is just really un-suspending legal rights you previously suspended — should be a far less drastic option: an intermediate step which becomes available well ahead of (and in part to help avoid) the “nuclear option” of deep-sixing the entire relationship. | Seeing as outright [[Event of default|default]] justifies total [[close-out]] of the whole relationship; terminating a lockup — which is just really un-suspending legal rights you previously suspended — should be a far less drastic option: an intermediate step which becomes available well ahead of (and in part to help avoid) the “nuclear option” of deep-sixing the entire relationship. |