Option Transactions - IETA Provision

IETA Emissions Trading Master Agreement A Jolly Contrarian owner’s manual™ 7 in a Nutshell™ The JC’s Nutshell™ summary of this term has moved uptown to the subscription-only ninja tier. For the cost of ½ a weekly 🍺 you can get it here. Sign up at Substack. You can even ask questions! Ask about it here. 7 in all its glory 7 Option Transactions 7.1 The Premium in respect of the purchase of an Option shall be paid by the Buyer to the Seller on the Payment Due Date in relation to the relevant Option Transaction. For the avoidance of doubt, all payments in relation to any Transaction deemed to be entered into pursuant to clause 8 (Effect of Exercise) will be made in accordance with the provisions of clause 9 (Billing and Payment) (to the extent that they do not relate to an Option Transaction). The Parties agree that any Option Transaction entered into between them shall be substantially in the form of Confirmation for Option Transactions set out in Schedule 3B (Form of Confirmation for Option Transactions). 7.2 Where the Buyer exercises an Option, it may do so by giving notice within the Exercise Period for the relevant Option Transaction: 7.2(a) in writing to the Seller in accordance with Clause 18.5 (Notices); or 7.2(b) orally to a representative of the Seller on a recorded telephone line (but not by a message left on a voicemail or other messaging system). 7.3 Unless otherwise agreed by the Parties, a notice of exercise is effective in the case of an American Option, (a) if received by the Seller at or prior to 16:00 hours on any Banking Day in the Exercise Period other than the Expiration Date, or (b) if received by the Seller at or prior to the Expiration Time on the Expiration Date, or (c) if received by the Seller after 16:00 hours on any Banking Day other than the Expiration Date, as of 09:00 hours on the next following Banking Day (if any) in the Exercise Period or, in the alternative, on the Expiration Date. 7.4 The Buyer will, within three (3) Banking Days after exercising such Option by giving notice orally, confirm such exercise by written notice to the Seller in accordance with Clause 18.5 (Notices). Any failure by the Buyer to send such written notice and/or any failure by the Seller to inform the Buyer of any inaccuracies in such written notice will not: (a) affect the validity or enforceability of the exercise of such Option or of the Option Transaction deemed to be entered into pursuant to Clause 8 (Effect of Option Exercise); or (b) be a material breach of obligations under this Agreement under Clause 14.2(c) (Material Obligations). 7.5 If the Parties agree in the relevant Confirmation that “Automatic Exercise” will apply in respect of an Option Transaction, then, unless the Seller is otherwise instructed by the Buyer at or prior to the Expiration Time in respect of an Option, that Option will have been deemed to have been exercised at the Expiration Time where the Positive Mark to Market Amount payable to the Buyer equals or exceeds the product of (a) ten per cent (10%) (or such other percentage as may have been agreed by the Parties) of the Strike Price and (b) the PTA Quantity. 7.6 For the purposes of this Clause 7, “Positive Mark to Market Amount” means: 7.6(a) in the case of a Call Option, the amount, if any, by which (x) the product of the PTA Quantity times the Reference Price exceeds (y) the product of the PTA Quantity times the Strike Price; and 7.6(b) in the case of a Put Option, the amount, if any, by which (x) the product of the PTA Quantity and the Strike Price exceeds (y) the product of the PTA Quantity times the Reference Price. 7.7 Where the Option is not exercised or deemed to be exercised in accordance with this Clause 7 by the Buyer at or prior to the Expiration Time on the Expiration Date, it will expire unexercised (except that any outstanding Premium will remain payable by the Buyer in accordance with Clause 9 (Billing and Payment)). edit Comparison See our natty emissions comparison table between the IETA, EFET and ISDA versions of emissions trading docs Resources and Navigation Emissions trading documentation ISDA: EU Anatomy • EU Wikitext • EU Nutshell (premium) • UK Anatomy • UK Wikitext (to be merged into EU Anatomy) IETA: IETA Master Agreement • IETA Wikitext • IETA Nutshell (premium) EFET: EFET Allowances Appendix • EFET Allowances Wikitext • EFET Nutshell (premium) Index: Click ᐅ to expand: ISDA Emissions TOC EUA Annex - Premium Emissions Pro tip: for tons of information about EU ETS and EU financial services regulation see Michał Głowacki’s magnificent emissions-euets.com website. Premium version of this page

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