ÿþ<!DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd"> <html> <head> <title>buy-in</title> <meta name="description" content="buy-in"/> <meta name="keywords" content="buy-in, section 9.9, credit derivatives definitions, Physical Settlement Date, Buy-in Notice, Buy-in Date, Relevant Bonds, Buy-in Offers, Buy-in Price, Buy-in Period"/> <meta name="subject" content="A short article about buy-in procedures under section 9.9 of the credit derivatives definitions"/> <link href="home.css" rel="stylesheet" type="text/css"/> </head> <body> <div id="wrapper"> <div id="header"> <div id="NavBlock"> <div id="navcontainer"> <ul id="nav"> <li><a href="index.html" title="derivativeslawyer.com main page.">home &nbsp;::&nbsp;</a></li> <li><a href="aboutus.html" title="asbout derivativeslawyer.com.">about us &nbsp;::&nbsp;</a></li> <li><a href="derivativesarticles.html" title="derivatives articles and publications.">derivatives resources &nbsp;::&nbsp;</a></li> <li><a href="derivativeslinks.html" title="useful derivatives links.">links &nbsp;::&nbsp;</a></li> <li><a href="derivativesmap.html" title="road map to derivativeslawyer.com.">site map &nbsp;::&nbsp;</a></li> <li><a href="derivativescareer.html" title="succeed with derivativeslawyer.com.">career </a></li></ul></div> </div> <div id="content"> <div class="pageHeaderTop"><h2></h2></div> <div class="welcomeShadow1"> <div class="shadow2"> <div class="shadow3"> <!--ORANGE BOX--> <div id="welcomeContainer"> <h6>buy-in procedures</h6> <p>If buyer fails (other than because of an impossibility or illegality under 9.3) to deliver bonds after 5 Business Days after <a href="wp0004.html" target="_blank">Physical Settlement Date</a>, Seller may  purchase bonds pursuant to the  buy-in procedures under 9.9:</P> <p>(a) Seller gives <strong>Buy-in Notice</strong> specifying the <strong>Buy-in Date</strong>, the <strong>Relevant Bonds</strong> and the outstanding principal balance</P> <p>(b) On Buy-in Date, Seller tries to obtain 5 or more <strong>Buy-in Offers</strong> from Dealers and determines <strong>Buy-in Price</strong> (the lowest or only Buy-in Offer)</P> <p>(c) If not successful, Seller can try up to each of the next 4 Business Days (the <strong>Buy-in Period</strong>)</P> <p>(d) Buyer s right to deliver the Relevant Bonds is suspended during the Buy-in Period</P> <p>(e) Seller can give another Buy-in Notice after 5 Business Days to commence another Buy-in Period if not successful at first</P> <p>(f) Once the Buy-in Price has been determined, Seller will give notice to Buyer</P> <p>(g) On the 3rd Business Days after the notice, (i) Buyer will be deemed to have delivered the bonds for which the Buy-in Price has been determined (ii) Seller to pay Physical Settlement Amount of Deliverable Obligation less (A) the product of (x) the Buy-in Price and (y) the outstanding principal balance of the Relevant Bonds and (B) reasonable brokerage costs incurred by the Seller.</P> <p>The buy-in procedures may be limited to the so-called "<a href="1000015.pdf">60 business-day cap</a>".</P> <br><br> <h1>derivativeslawyer.com</h1> <p><strong>Last updated February 2007</strong></p> <a href="#top" title="Back to Top">^ </a> <p><i>The above notes are intended to provide only general outlines and, where applicable, should be read in conjunction with, and are qualified in their entirety by, the full provisions of the relevant ISDA provisions and definitions. 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