In this article, we discuss a large number of points to consider when preparing these agreements. It is generally fair for an index provider to require the issuer to indicate the index operator`s limited obligation in relation to the structured product. This is usually done through the necessary exclusion of liability debate. However, such language must be carefully considered so that (a) in combination with short-term sheets or COUNTERPARTIEs, the required exclusion of liability is not three times greater than other disclosures and (b) the language may be slightly modified to reflect the circumstances of the offer. (Notes vs. CD, etc.) This can be achieved through provisions allowing for the use of a shorter disclaimer for shorter marketing materials and provisions for indicating the necessary exclusions of liability, with minor modifications. In the case of a new index, the licensee may wish the index provider to offer training to the relevant trader on the nature of the index, its design and the possible risks associated with the use of the index. Of course, the extent of such training depends on the relative needs of the licensee and the skills of the licensor. Parties.
Either the issuer or the associated dealer broker can enter into the license agreement with the index issuer, and several related companies can often be parties to the license agreement. The possible use of the index should be taken into account in determining which companies should participate in the agreement: will the issuer market bonds linked to the index through several sub-authors? Will the underwriter distribute bonds linked to the index issued by several different issuers? Which parties need index data to perform payment or price calculations? Similarly, a product can be initially designed for an offer under a specific “Wrapper”, for example. B an American NTD. In addition, licensee should exercise caution in limiting the volume of the license only for use, for example, in the United States and its territories. Many offers registered in the United States and other types of offers concern a number of offers outside the United States. And it`s always possible that if an offer is successful in one jurisdiction, a broker may try to expand its use to other markets it serves. Licensees may wish to negotiate contractual terms that ensure that the index remains an appropriate benchmark over time and in a wide range of regulatory environments. As a result, the lessee can ask the index provider: first, this complexity means that the documentation must be checked in the cycle in order to ensure uniformity. For example, do the data license and the fund license coincide? Do the documents contain conflicting provisions or accidentally double the rights (e.g.
B two separate supplier audit rights)? The license to use the index is usually structured as a right to do certain things with the data, accompanied by separate contractual restrictions. .