Acceleration - Pledge GMSLA Provision

2018 Global Master Securities Lending Agreement (Pledge Version) A Jolly Contrarian owner’s manual™ Resources and navigation 2010 GMSLA: Full wikitext · Nutshell wikitext | GMLSA legal code | GMSLA Netting Pledge GMSLA: Hard copy (ISLA) · Full wikitext · Nutshell wikitext | 1995 OSLA: OSLA wikitext | OSLA in a nutshell | GMSLA/PGMSLA/OSLA clause comparison table From Our Friends On The Internet: Guide to equity finance | ISLA’s guide to securities lending for regulators and policy makers Navigation 2010 GMSLA 1 · 2 · 3 · 4 · 5 · 6 · 7 · 8 · 9 · 10 · 11 · 12 · 13 · 14 · 15 · 16 · 17 · 18 · 19 · 20 · 21 · 22 · 23 · 24 · 25 · 26 · 27 · Schedule · Agency Annex · Addendum for Pooled Principal Agency Loans 2018 Pledge GMSLA 1 · 2 · 3 · 4 · 5 · 6 · 7 · 8 · 9 · 10 · 11 · 12 · 13 · 14 · 15 · 16 · 17 · 18 · 19 · 20 · 21 · 22 · 23 · 24 · 25 · 26 · 27 · 28 · Schedule · Agency Annex Stock Loan owner’s manuals: 2010 GMSLA · 2000 GMSLA · Pledge GMSLA · OSLA Index: Click ᐅ to expand: GMSLA Pledge GMSLA Clause 11.2 in a Nutshell™ Use at your own risk, campers! 11.2 Acceleration: Borrower’s obligations will be accelerated as at the time of the Event of Default (the Termination Date) as follows: 11.2(a) The Non-Defaulting Party will determine the Default Market Value of the Borrower’s delivery and payment obligations under paragraph 11.4 as at the Termination Date. 11.2(b) Using those values, [the Non-Defaulting Party will determine and notify]what each Party owes as at the Termination Date, converting amounts into the Base Currency at the Spot Rate where necessary, and will set those sums off against each other. The Party owing the greater amount must pay the difference on the Business Day after notification. view template Full text of Clause 11.2 11.2 Borrower’s Delivery and payment obligations (and any other obligations Borrower has under the Agreement including, without limitation, any obligation to pay amounts which have accrued under paragraph 7) shall be accelerated so as to require performance thereof at the time such Event of Default occurs (the date of which shall be the Termination Date) so that performance of such obligations shall be effected only in accordance with the following provisions. 11.2(a) The Default Market Value of the Equivalent Securities to be delivered by Borrower and any amount (including interest accrued) to be paid by Borrower shall be established by the Non-Defaulting Party in accordance with paragraph 11.4 and deemed as at the Termination Date. 11.2(b) On the basis of the sums so established, an account shall be taken (as at the Termination Date) of what is due from each Party to the other under this Agreement (on the basis that Lender's claim against Borrower in respect of Delivery of Equivalent Securities is equal to the Default Market Value thereof) and the sums due from one Party shall be set off against the sums due from the other and only the balance of the account shall be payable (by the Party having the claim valued at the lower amount pursuant to the foregoing) and such balance shall be payable on the next following Business Day after such account has been taken and such sums have been set off in accordance with this paragraph. For the purposes of this calculation, any sum not denominated in the Base Currency shall be converted into the Base Currency at the spot rate prevailing at such dates and times determined by the Non-Defaulting Party acting reasonably. view template Related agreements and comparisons Related agreements: Click here for the same clause in the 2010 GMSLA Comparison: Click to compare the 2010 GMSLA and 2018 Pledge GMSLA versions of this clause. Tell me more Sign up for our newsletter — or just get in touch: for ½ a weekly 🍺 you get to consult JC. Ask about it here.

Content and comparisons

11. Consequences of an Event of Default

11.1 Application of 11.2 to 11.7 following Event of Default

11.2 Delivery and payment obligations following Event of Default

11.3 Definition of Default Market Value

11.4 Determination of Default Market Value

11.5 Net Value determination where unable to sell Securities

11.6 Where Non-Defaulting Party has not determined Default Market Value

11.7 Other costs, expenses and interest payable in consequence of an Event of Default

11.8 Set-off

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Summary

Multi-level set-off

Paragraph 11.2(b) sets up a set-off of amounts due under the 2010 GMSLA to create a single net payment due under the 2010 GMSLA in respect of all terminated transactions. The Non-Defaulting Party can, in turn, set that net sum off against amounts owed to or by the Defaulting Party under other agreements (such as an ISDA Master Agreement.

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General discussion

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See also

• Netting under a GMSLA.

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