Template:Nutshell Equity Derivatives 11.1: Difference between revisions

{{eqderivprov|11.1(a)}} '''{{eqderivprov|Successor Indices}}'''. The {{eqderivprov|Calculation Agent}} may deem an {{eqderivprov|Index}} calculated by a successor sponsor to the  {{eqderivprov|Index Sponsor}}, or a “'''{{eqderivprov|Successor Index}}'''” that replaces the {{eqderivprov|Index}} and uses a substantially similar formula and calculation method, to ''be'' the {{eqderivprov|Index}}. <br>

{{eqderivprov|11.1(b)}} '''{{eqderivprov|Index Adjustment Event}}s''': If before any {{eqderivprov|Valuation Date}} the {{eqderivprov|Index Sponsor}} announces a material change to the calculation method of, or materially modifies the {{eqderivprov|Index}}  in any way not contemplated in its formula or method (an “'''{{eqderivprov|Index Modification}}'''”), permanently cancels the {{eqderivprov|Index}} where no {{eqderivprov|Successor Index}} exists (an “'''{{eqderivprov|Index Cancellation}}'''”) or fails to announce a relevant {{eqderivprov|Index}} (an “'''{{eqderivprov|Index Disruption}}'''” (each of these events an “'''{{eqderivprov|Index Adjustment Event}}'''”), then: <br>  

:(A) if “'''[[Calculation Agent Adjustment (Adjustment Events) - Equity Derivatives Provision|Calculation Agent Adjustment]]'''” applies, then the {{eqderivprov|Calculation Agent}} must determine whether the {{eqderivprov|Index Adjustment Event}} materially affects the {{eqderivprov|Index Transaction}} and, if it does, must calculate the any necessary price, using the {{eqderivprov|Index}} level as at that {{eqderivprov|Valuation Date}} it determines using the {{eqderivprov|Index}} calculation method last in effect before the {{eqderivprov|Index Adjustment Event}}, using the securities that comprised that {{eqderivprov|Index}} at that time; <br>

:(B) if “'''[[Negotiated Close-out (Adjustment Events) - Equity Derivatives Provision|Negotiated Close-out]]'''” applies then the parties may terminate the {{eqderivprov|Transaction}} on mutually acceptable terms and if they do not it will continue on the terms and conditions and using formulas and calculation methods in effect as of the time of any necessary calculations; or <br>

::(1) for an {{eqderivprov|Index Disruption}}, the {{eqderivprov|Transaction}} will be cancelled on the {{eqderivprov|Valuation Date}}, <br>

::(3) following announcement of an {{eqderivprov|Index Modification}}, either party may elect, on two {{eqderivprov|Scheduled Trading Days}}’ notice (or less, so that termination occurs by the {{eqderivprov|Index Modification}} date), to cancel the {{eqderivprov|Transaction}} by the {{eqderivprov|Scheduled Trading Day}} before the {{eqderivprov|Index Modification}} becomes effective and  

:::(X) for {{eqderivprov|Option Transaction}}s, {{eqderivprov|Seller}} will pay to {{eqderivprov|Buyer}} the Section {{eqderivprov|12.7(b)(ii)}} amount and