Past version: Effective from 22 Apr 2013 to 09 Dec 2018
Immediately upon such breach under Rule 8.1.2:—
(1) each Novated Contract for the purchase of securities between CDP and the Defaulting Clearing Member in relation to a Customer Account shall be terminated. In respect of each such Novated Contract, a new contract (the "New Purchase Contract") shall be deemed to have been made between CDP and the relevant buying customer of the Defaulting Clearing Member, pursuant to which the buying customer shall have the obligation to pay the relevant purchase consideration to CDP and, subject to Rule 6.6 and Rule 8 shall have the right to receive the relevant securities from CDP;
(2) each Novated Contract for the sale of securities between CDP and the Defaulting Clearing Member in relation to a Customer Account shall be terminated. In respect of each such Novated Contract, a new contract (the "New Sale Contract") shall be deemed to have been made between CDP and the relevant selling customer of the Defaulting Clearing Member, pursuant to which the selling customer shall have the obligation to deliver the relevant securities to CDP and, subject to Rule 6.6 and Rule 8 shall have the right to receive the relevant sale consideration from CDP; and
(3) in respect of Novated Contracts between CDP and the Defaulting Clearing Member in relation to a House Account:
(a) CDP shall be entitled (but not obliged) to set-off any or all Novated Contracts for the sale of a security against any or all Novated Contracts for the purchase of that security, regardless of the relevant Settlement Days for such Novated Contracts;
(b) CDP shall be entitled (but not obliged) to force-sell any or all securities due from CDP to the Defaulting Clearing Member at such time and price as CDP may determine. CDP has no liability for any losses to the Defaulting Clearing Member arising from the force-sale of securities. The resulting proceeds of such force-sale shall be held by CDP as Collateral and applied in accordance with these Clearing Rules and the Security Deed; and
(c) any securities due from the Defaulting Clearing Member to CDP regardless of the relevant Settlement Days (if not set-off pursuant to Rule 8.2.2(3)(a)) shall be settled in accordance with these Clearing Rules on such day as CDP may determine.
Subject as otherwise provided in these Clearing Rules, the terms of each New Purchase Contract and New Sale Contract shall be on the same terms as its corresponding Novated Contract. For the avoidance of doubt, the termination of each Novated Contract shall be without prejudice to any of the rights or remedies of CDP thereunder and CDP's right to damages in respect of any breach (whether antecedent or otherwise) under each Novated Contract shall not be extinguished.
Amended on 23 January 200923 January 2009 and 22 April 201322 April 2013.