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Sample Derivatives Disclaimers

Type Provisions

OTC derivatives

The product contains an interest in an over-the counter derivative transaction and, as such, involve the risk of adverse or unanticipated market developments, risks of illiquidity and other risks, including without limitation, principal, interest rate, currency, credit, political, liquidity and market risk. It is not suitable for all investors. The description of special considerations and risks herein does not purport to be exhaustive. We disclaim any responsibility to advise prospective investors of such risks as they exist at the date of this document or as they change from time to time. Prospective investors should understand the risks involved and should reach an investment decision after careful consideration with their tax, accounting and legal advisors of the suitability of the notes in light of their particular financial circumstances and financial objectives. ^

interrelated factors

The trading value of the product will be affected by factors that interrelate in complex ways. The effect of one factor may offset the increase in the trading value of the product caused by another factor and that the effect of one factor may exacerbate the decrease in the trading value of the product caused by another factor. ^

FX risk

The Notes are denominated in [ ]. An investor will be subject to fluctuations in exchange rates, which could have an adverse effect on the investor s return upon the conversion into local currency received. ^

liquidity risk

The notes may be illiquid and, to the extent that we choose to make a market in the notes, we may be the only purchaser of the notes. The notes may trade well below par prior to maturity.
The notes are structured and not necessarily liquid. No assurances can be made that any meaningful secondary market will develop in the notes. Bid-offer spreads are expected to be significantly higher than they are for vanilla debt securities. No investor should purchase the notes unless such investor understands and is able to bear the risk that such notes may not be readily saleable. Investors in the notes must be prepared to hold the notes until maturity.
We may, but are not obligated to, make a market in the notes. In addition, we may at our sole discretion discontinue any market-making activities at any time without notice. If an active public market for the notes does not develop, the market prices and liquidity of the notes may be adversely affected. ^

The above notes are intended to highlight issues and provide only general outlines and not intended to be comprehensive nor legal advice. Where applicable, the same should be read in conjunction with, and are qualified in their entirety by, the full provisions of the relevant ISDA provisions and definitions. They shall never be used in place of professional advice. We accept no responsibility for any loss arising from any action taken or not taken by anyone using this material or using this material in conjunction with any ISDA documentation in reliance thereof. If you have any question, please contact us.

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