On 1 June 2010, Issuer A issues 100 million of callable bull certificates based on PLC X's shares listed on Bursa Securities. The certificates have the following features:
Call Price : RM1.50
Exercise Price : RM1.00
Expiry Date : 30 Dec 2010
The MCE for the callable bull certificates occurs at 9.30 a.m. on 2 August 2010, when the transacted price is RM1.40, which is below the call price.
5 "MCE" or "mandatory call event" is defined in paragraph 5.02 as the first occurrence at any time before the certificate's expiry date where the transacted price of the underlying financial instrument is –
(a) at or below (in respect of a callable bull certificate); or
(b) at or above (in respect of a callable bear certificate),
the call price and upon which the callable bull/bear certificate will be called by the issuer.