Automatic Early Redemption Clause Samples
The Automatic Early Redemption clause defines the conditions under which a financial instrument, such as a bond or structured note, is redeemed before its scheduled maturity date without the need for action by the holder. Typically, this clause is triggered by specific events or performance thresholds, such as the underlying asset reaching a certain price or a predetermined date being met. Its core practical function is to provide certainty and efficiency by specifying when and how early repayment will occur, thereby managing risk and clarifying the rights and obligations of both issuers and investors.
Automatic Early Redemption. 4.1 If Automatic Early Redemption is specified in the applicable Final Terms to be applicable to any Reference Date or Averaging Reference Date or any other relevant date (as specified in the applicable Final Terms) (any such date being, for the purposes of this paragraph 4, a “Relevant Date”) for an Index, and if the Calculation Agent determines that an Automatic Early Redemption Event has occurred in respect of such Relevant Date, then (unless otherwise, and to the extent, specified in the applicable Final Terms) the Notes will be redeemed on the Automatic Early Redemption Date corresponding to such Relevant Date.
4.2 The following terms and expressions shall have the following meanings in relation to Notes to which these Index Linked Conditions apply:
Automatic Early Redemption. Certain provisions of certain types of Structured Notes set out in the Additional Terms and Conditions of the Notes provide that such Notes will be automatically redeemed early in certain specified circumstances set out in the relevant Additional Terms and Conditions of the Notes. Should such circumstances apply the Notes will be automatically redeemed early, without any requirement for the giving of notice, at the applicable Early Redemption Amount, all subject to and in accordance with the relevant provisions of the Additional Terms and Conditions of the Notes.