Change in Law - Equity Derivatives Provision: Difference between revisions

Revision as of 10:10, 18 January 2016

12.9(a)(ii) in a Nutshell™ _{(equity derivatives edition)}

12.9(a)(ii) “Change in Law” means either party determines that, due to a change in law or regulation:

(X) it becomes illegal to buy, sell or hold underlying Shares or;

(Y) it becomes materially more expensive to perform the Transaction.

The industry has generally moved to omit the "Increased Cost of Hedging" aspects of this definition (because it is dealt with there). You may see this expressed as: "Applicable, provided that section 12.9(a)(ii)(Y) of the Equity Definitions does not apply." See also, for example, the 2007 European Master Equity Derivatives Confirmation Agreement, which provides the following:

@@ Line 2: / Line 2: @@
 {{eqderivsnap|12.9(a)(ii)}}
 ==Commentary==
-===Omission of "material increase in costs" limb===
+====Omission of "material increase in costs" limb====
-Rhe industry has generally moved to omit the "{{eqderivprov|Increased Cost of Hedging}}" aspects of this definition (because it is dealt with there). You may see this expressed as: "Applicable, provided that section {{eqderivprov|12.9(a)(ii)(Y)}} of the Equity Definitions does not apply." See also, for example, the [[2007 European Master Equity Derivatives Confirmation Agreement]], which provides the following:
+The industry has generally moved to omit the "{{eqderivprov|Increased Cost of Hedging}}" aspects of this definition (because it is dealt with there). You may see this expressed as: "Applicable, provided that section {{eqderivprov|12.9(a)(ii)(Y)}} of the Equity Definitions does not apply." See also, for example, the [[2007 European Master Equity Derivatives Confirmation Agreement]], which provides the following:
 {{eqderivsnap|Amended Change In Law}}