Template:2002 ISDA Equity Derivatives Definitions 12.9(b)(ii): Difference between revisions

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:12.9(b)(ii) If “'''{{eqderivprov|{{eqderivprov|Failure to Deliver}}}}'''““ is specified in the related Confirmation to be applicable to a {{eqderivprov|Transaction}}, then such event shall not constitute an {{eqderivprov|Event of Default}} under the [[ISDA Master Agreement]], but upon the occurrence of such an event, the party required to deliver the relevant {{eqderivprov|Shares}} (the “'''{{eqderivprov|Delivering Party}}'''”) shall (A) give the other party (the “'''{{eqderivprov|Receiving Party}}'''”) notice that a {{eqderivprov|Failure to Deliver}} has occurred within one {{eqderivprov|Clearance System Business Day}} of the relevant {{eqderivprov|Exercise Date}} in the case of an {{eqderivprov|Option Transaction}} and at least one {{eqderivprov|Settlement Cycle}} prior to the {{eqderivprov|Settlement Date}} in the case of a {{eqderivprov|Forward Transaction}} or {{eqderivprov|Equity Swap Transaction}} and (B) deliver on the {{eqderivprov|Settlement Date}} to the {{eqderivprov|Receiving Party}} such number of {{eqderivprov|Shares}} that it can deliver on such date. The {{eqderivprov|Receiving Party}}’s obligation to make any corresponding payment or delivery to the {{eqderivprov|Delivering Party}} shall be reduced in proportion to the number of {{eqderivprov|Shares}} it receives from the {{eqderivprov|Delivering Party}}. In respect of a {{eqderivprov|European Option}} or a {{eqderivprov|Forward Transaction}}, the {{eqderivprov|Receiving Party}} may then elect to terminate the {{eqderivprov|Transaction}} by giving notice to the {{eqderivprov|Delivering Party}} and the {{eqderivprov|Transaction}} will terminate on the date that such notice is effective. The {{eqderivprov|Receiving Party}} (who shall be the {{eqderivprov|Determining Party}}) shall determine the {{eqderivprov|Cancellation Amount}} payable in relation to such terminated {{eqderivprov|Transaction}} (after consideration of any partial delivery). In respect of an {{eqderivprov|American Option}} or a {{eqderivprov|Bermuda Option}}, the {{eqderivprov|Receiving Party}} may then elect to terminate that part of the {{eqderivprov|Transaction}} consisting of the exercised {{eqderivprov|Option}}s by giving notice to the {{eqderivprov|Delivering Party}}. On the date that such notice is effective, a {{eqderivprov|Transaction}} consisting of the exercised {{eqderivprov|Option}}s only shall be terminated and the {{eqderivprov|Receiving Party}} (who shall be the {{eqderivprov|Determining Party}}) shall determine the {{eqderivprov|Cancellation Amount}} payable in relation to such terminated {{eqderivprov|Transaction}} (after consideration of any partial delivery). In respect of an {{eqderivprov|Equity Swap Transaction}}, the {{eqderivprov|Receiving Party}} may then elect to terminate that part of the {{eqderivprov|Transaction}} consisting of the {{eqderivprov|Number of Shares to be Delivered }} or {{eqderivprov|Number of Baskets to be Delivered}}, [[as the case may be]], on that {{eqderivprov|Settlement Date}} by giving notice to the {{eqderivprov|Delivering Party}}. On the date that such notice is effective, a {{eqderivprov|Transaction}} consisting of the {{eqderivprov|Number of Shares to be Delivered }} or {{eqderivprov|Number of Baskets to be Delivered}}, [[as the case may be]], on that {{eqderivprov|Settlement Date}} only shall be deemed to have been terminated on such {{eqderivprov|Settlement Date}} and the {{eqderivprov|Receiving Party}} (who shall be the {{eqderivprov|Determining Party}}) shall determine the {{eqderivprov|Cancellation Amount}} payable in relation to such terminated {{eqderivprov|Transaction}} (after consideration of any partial delivery). In respect of an {{eqderivprov|American Option}} or a {{eqderivprov|Bermuda Option}}, in each case to which {{eqderivprov|Multiple Exercise}} is applicable and upon which less than all {{eqderivprov|Option}}s have been exercised or deemed exercised on the relevant {{eqderivprov|Exercise Date}}, or in respect of an {{eqderivprov|Equity Swap Transaction}} in relation to which one or more {{eqderivprov|Settlement Date}}s have not occurred, the {{eqderivprov|Receiving Party}} may elect within one {{eqderivprov|Settlement Cycle}} of the {{eqderivprov|Settlement Date}} on which the {{eqderivprov|Transaction}} was partially terminated to terminate the remaining {{eqderivprov|Transaction}} upon two {{eqderivprov|Scheduled Trading Day}}s’ notice to the {{eqderivprov|Delivering Party}}, in which event the {{eqderivprov|Transaction}} shall terminate on the date that such notice is effective and the {{eqderivprov|Receiving Party}} (who shall be the {{eqderivprov|Determining Party}}) shall determine the {{eqderivprov|Cancellation Amount}} payable in relation to such terminated {{eqderivprov|Transaction}}.  <br>
:12.9(b)(ii) If “'''{{eqderivprov|Failure to Deliver}}'''” is specified in the related Confirmation to be applicable to a {{eqderivprov|Transaction}}, then such event shall not constitute an {{eqderivprov|Event of Default}} under the [[ISDA Master Agreement]], but upon the occurrence of such an event, the party required to deliver the relevant {{eqderivprov|Shares}} (the “'''{{eqderivprov|Delivering Party}}'''”) shall (A) give the other party (the “'''{{eqderivprov|Receiving Party}}'''”) notice that a {{eqderivprov|Failure to Deliver}} has occurred within one {{eqderivprov|Clearance System Business Day}} of the relevant {{eqderivprov|Exercise Date}} in the case of an {{eqderivprov|Option Transaction}} and at least one {{eqderivprov|Settlement Cycle}} prior to the {{eqderivprov|Settlement Date}} in the case of a {{eqderivprov|Forward Transaction}} or {{eqderivprov|Equity Swap Transaction}} and (B) deliver on the {{eqderivprov|Settlement Date}} to the {{eqderivprov|Receiving Party}} such number of {{eqderivprov|Shares}} that it can deliver on such date. The {{eqderivprov|Receiving Party}}’s obligation to make any corresponding payment or delivery to the {{eqderivprov|Delivering Party}} shall be reduced in proportion to the number of {{eqderivprov|Shares}} it receives from the {{eqderivprov|Delivering Party}}. In respect of a {{eqderivprov|European Option}} or a {{eqderivprov|Forward Transaction}}, the {{eqderivprov|Receiving Party}} may then elect to terminate the {{eqderivprov|Transaction}} by giving notice to the {{eqderivprov|Delivering Party}} and the {{eqderivprov|Transaction}} will terminate on the date that such notice is effective. The {{eqderivprov|Receiving Party}} (who shall be the {{eqderivprov|Determining Party}}) shall determine the {{eqderivprov|Cancellation Amount}} payable in relation to such terminated {{eqderivprov|Transaction}} (after consideration of any partial delivery). In respect of an {{eqderivprov|American Option}} or a {{eqderivprov|Bermuda Option}}, the {{eqderivprov|Receiving Party}} may then elect to terminate that part of the {{eqderivprov|Transaction}} consisting of the exercised {{eqderivprov|Option}}s by giving notice to the {{eqderivprov|Delivering Party}}. On the date that such notice is effective, a {{eqderivprov|Transaction}} consisting of the exercised {{eqderivprov|Option}}s only shall be terminated and the {{eqderivprov|Receiving Party}} (who shall be the {{eqderivprov|Determining Party}}) shall determine the {{eqderivprov|Cancellation Amount}} payable in relation to such terminated {{eqderivprov|Transaction}} (after consideration of any partial delivery). In respect of an {{eqderivprov|Equity Swap Transaction}}, the {{eqderivprov|Receiving Party}} may then elect to terminate that part of the {{eqderivprov|Transaction}} consisting of the {{eqderivprov|Number of Shares to be Delivered }} or {{eqderivprov|Number of Baskets to be Delivered}}, [[as the case may be]], on that {{eqderivprov|Settlement Date}} by giving notice to the {{eqderivprov|Delivering Party}}. On the date that such notice is effective, a {{eqderivprov|Transaction}} consisting of the {{eqderivprov|Number of Shares to be Delivered }} or {{eqderivprov|Number of Baskets to be Delivered}}, [[as the case may be]], on that {{eqderivprov|Settlement Date}} only shall be deemed to have been terminated on such {{eqderivprov|Settlement Date}} and the {{eqderivprov|Receiving Party}} (who shall be the {{eqderivprov|Determining Party}}) shall determine the {{eqderivprov|Cancellation Amount}} payable in relation to such terminated {{eqderivprov|Transaction}} (after consideration of any partial delivery). In respect of an {{eqderivprov|American Option}} or a {{eqderivprov|Bermuda Option}}, in each case to which {{eqderivprov|Multiple Exercise}} is applicable and upon which less than all {{eqderivprov|Option}}s have been exercised or deemed exercised on the relevant {{eqderivprov|Exercise Date}}, or in respect of an {{eqderivprov|Equity Swap Transaction}} in relation to which one or more {{eqderivprov|Settlement Date}}s have not occurred, the {{eqderivprov|Receiving Party}} may elect within one {{eqderivprov|Settlement Cycle}} of the {{eqderivprov|Settlement Date}} on which the {{eqderivprov|Transaction}} was partially terminated to terminate the remaining {{eqderivprov|Transaction}} upon two {{eqderivprov|Scheduled Trading Day}}s’ notice to the {{eqderivprov|Delivering Party}}, in which event the {{eqderivprov|Transaction}} shall terminate on the date that such notice is effective and the {{eqderivprov|Receiving Party}} (who shall be the {{eqderivprov|Determining Party}}) shall determine the {{eqderivprov|Cancellation Amount}} payable in relation to such terminated {{eqderivprov|Transaction}}.  <br>

Revision as of 13:03, 4 September 2018

12.9(b)(ii) If “Failure to Deliver” is specified in the related Confirmation to be applicable to a Transaction, then such event shall not constitute an Event of Default under the ISDA Master Agreement, but upon the occurrence of such an event, the party required to deliver the relevant Shares (the “Delivering Party”) shall (A) give the other party (the “Receiving Party”) notice that a Failure to Deliver has occurred within one Clearance System Business Day of the relevant Exercise Date in the case of an Option Transaction and at least one Settlement Cycle prior to the Settlement Date in the case of a Forward Transaction or Equity Swap Transaction and (B) deliver on the Settlement Date to the Receiving Party such number of Shares that it can deliver on such date. The Receiving Party’s obligation to make any corresponding payment or delivery to the Delivering Party shall be reduced in proportion to the number of Shares it receives from the Delivering Party. In respect of a European Option or a Forward Transaction, the Receiving Party may then elect to terminate the Transaction by giving notice to the Delivering Party and the Transaction will terminate on the date that such notice is effective. The Receiving Party (who shall be the Determining Party) shall determine the Cancellation Amount payable in relation to such terminated Transaction (after consideration of any partial delivery). In respect of an American Option or a Bermuda Option, the Receiving Party may then elect to terminate that part of the Transaction consisting of the exercised Options by giving notice to the Delivering Party. On the date that such notice is effective, a Transaction consisting of the exercised Options only shall be terminated and the Receiving Party (who shall be the Determining Party) shall determine the Cancellation Amount payable in relation to such terminated Transaction (after consideration of any partial delivery). In respect of an Equity Swap Transaction, the Receiving Party may then elect to terminate that part of the Transaction consisting of the Number of Shares to be Delivered or Number of Baskets to be Delivered, as the case may be, on that Settlement Date by giving notice to the Delivering Party. On the date that such notice is effective, a Transaction consisting of the Number of Shares to be Delivered or Number of Baskets to be Delivered, as the case may be, on that Settlement Date only shall be deemed to have been terminated on such Settlement Date and the Receiving Party (who shall be the Determining Party) shall determine the Cancellation Amount payable in relation to such terminated Transaction (after consideration of any partial delivery). In respect of an American Option or a Bermuda Option, in each case to which Multiple Exercise is applicable and upon which less than all Options have been exercised or deemed exercised on the relevant Exercise Date, or in respect of an Equity Swap Transaction in relation to which one or more Settlement Dates have not occurred, the Receiving Party may elect within one Settlement Cycle of the Settlement Date on which the Transaction was partially terminated to terminate the remaining Transaction upon two Scheduled Trading Days’ notice to the Delivering Party, in which event the Transaction shall terminate on the date that such notice is effective and the Receiving Party (who shall be the Determining Party) shall determine the Cancellation Amount payable in relation to such terminated Transaction.
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