Nationalization, Insolvency and Delisting - Equity Derivatives Provision: Difference between revisions
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{{eqderivsnap|12.6}} | {{eqderivsnap|12.6}} | ||
====Commentary==== | ====Commentary==== | ||
Upon the occurrence of these {{eqderivprov|Extraordinary Events}} ({{eqderivprov|Nationalization}}, {{eqderivprov|Insolvency}} and {{eqderivprov|Delisting}}) the parties may elect to terminate (if they choose {{eqderivprov|Negotiated Close-out}}), or the transaction will automatically terminate (if {{eqderivprov|Cancellation and Payment}} or {{eqderivprov|Partial Payment and Cancellation}} are selected). | Upon the occurrence of these {{eqderivprov|Extraordinary Events}} ({{eqderivprov|Nationalization}}, {{eqderivprov|Insolvency}} and {{eqderivprov|Delisting}}) the parties may elect to terminate (if they choose {{eqderivprov|Negotiated Close-out}}), or the transaction will automatically terminate (if {{eqderivprov|Cancellation and Payment (Extraordinary Events)}} or {{eqderivprov|Partial Payment and Cancellation (Extraordinary Events)}} are selected). | ||
Note that a {{eqderivprov|Delisting}} covers full cessation of trading but not a suspension of trading, even if indefinite. But in that case a {{eqderivprov|Hedging Disruption}} or - at a pinch - {{eqderivprov|Increased Cost of Hedging}} ought to get you home. | Note that a {{eqderivprov|Delisting}} covers full cessation of trading but not a suspension of trading, even if indefinite. But in that case a {{eqderivprov|Hedging Disruption}} or - at a pinch - {{eqderivprov|Increased Cost of Hedging}} ought to get you home. | ||
Revision as of 14:43, 11 August 2014
Commentary
Upon the occurrence of these Extraordinary Events (Nationalization, Insolvency and Delisting) the parties may elect to terminate (if they choose Negotiated Close-out), or the transaction will automatically terminate (if Cancellation and Payment (Extraordinary Events) or Partial Payment and Cancellation (Extraordinary Events) are selected).
Note that a Delisting covers full cessation of trading but not a suspension of trading, even if indefinite. But in that case a Hedging Disruption or - at a pinch - Increased Cost of Hedging ought to get you home.