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Chapter 4 — Indexation Guidance

4.2 Step 1: Evaluate Any Exercise Contingencies

4.2 Step 1: Evaluate Any Exercise Contingencies

Footnotes

1
An exercise contingency that is based on a parity provision or the credit rating of the issuer would generally be included only in the terms of a convertible instrument, not in those of a freestanding equity-linked instrument. If an exercise contingency that is based on a parity provision or the credit rating of the issuer was included in the terms of a freestanding equity-linked financial instrument, the exercise contingency would generally preclude the freestanding financial instrument from being indexed to the entity’s stock. See, however, Section 4.3.7.14.
2
See footnote 1.