South32 Limited (ASX Code: S32) USD $0.03 Special Dividend – Adjustment Implications for S32 ETOs

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South32 Corporation Limited USD $0.03 Special Dividend – Adjustment implications for ETOs

ASX Notice No. 0930.22.09 dated 1 September 2022 outlined the adjustment method to be applied to ETOs over South32 Limited (ASX Code: S32) due to the USD $0.03 special dividend and an ordinary dividend of USD $0.14 both having an ex-dividend date of 15 September 2022.

Lifting of Exercise Restriction

Please be advised that further to ASX Notice No. 0998.22.09 exercise restriction has been lifted for South32 Limited (S32) Wednesday 14 September 2022.

Effective Date

The effective date of this adjustment is Thursday, 15 September 2022, when the underlying security commences trading on an ex-dividend basis.

ASX determined that the last cum-dividend VWAP based on trading on ASX markets on Wednesday, 14 September 2022 was $4.2827 and determined that the applicable AUD/USD exchange rate realised by ASXCL was 0.677838.

Standard Method of Adjustment

For an old contract size of 100 shares, the new contract size will be adjusted, using TMC threshold truncation.

Theoretical New Contract Size = Old Contract Size + (total special dividend paid per Old Contract Size/FX)/(S – OD/FX – SD/FX)

Theoretical New Contract Size = 100 + ($0.03/0.677838*100)/($4.2827-$0.14/0.677838-$0.03/0.677838)

=101.0977 truncated to 100 where the difference of 1.0977 will be cash adjusted based on the below formula.

Strike Factor = Old Contract Size/Theoretical New Contract Size

Strike Factor = 100/101.0977

= 0.989142

Please note that this is a non-rights style adjustment.

Cash Equalisation Adjustment Payments for Contract Size Roundings

The cash adjustment is calculated by taking the difference between the contract value of the option before and after the adjustment. Variants to the formula apply for rights style adjustments and when the adjustment occurs on the day of the option’s expiry.

Cash adjustment = (BOP * BUV) – (AOP * AUV)

Where

BUV =Before (adjustment) Unit Value = BP * BU rounded to nearest cent

AUV =After (adjustment) Unit Value = AP * AU rounded to nearest cent

BU = units per lot (multiplier) before the adjustment (old traded entity)

AU = units per lot (multiplier) after the adjustment (old traded entity)

BP = for rights style, =SP/Adjustment Factor, for non-rights style=SP.

AP = for rights style, =SP, for non-rights style=SP * Adjustment Factor.

SP = settlement price of the option if not the options expiry day, otherwise the intrinsic price (underlying price-strike price for calls, strike-underlying price for puts) if on expiry date. Refer Notes 1 and 2 below

BOP =pre-adjusted open position Refer Notes 1 and 3 below

AOP =post-adjusted open position Refer Notes 1 and 3 below

Note:

1. Cash adjustments on expiry will apply to exercised positions only.

2. The intrinsic price used for exercised positions on expiry is based on the adjusted strike price for rights style adjustments and the pre-adjusted strike price for non-rights style adjustments. Set negative intrinsic prices to zero i.e. if an out of the money is exercised, the intrinsic price and hence cash adjustment is zero.

3. Pre and post adjusted positions will be the same unless there is a position adjustment factor applied to the open position associated with the adjustment. For rights style use the start of day position (i.e. exclude any UA trading activity), for non-rights style use the (end-of-day) position prior to the adjustment.

4. Cash adjustments will also apply to LEPO positions.

5. For short positions, the result of the cash adjustment formula should have its sign reversed (multiply by -1). For non-LEPO positions the truncation approach ensures that the seller (writer) is always debited and the buyer (taker) is credited. Because the LEPO strike is usually returned to 1c after the adjustment, the holder of a short LEPO position may be credited and long position may be debited.

Refer to table below for adjusted strike and contract size

OLD SIZE	NEW SIZE	OLD STRIKE (CENTS)	NEW STRIKE (CENTS)	Exercise
100	100	1	1	E
100	100	198	196	A
100	100	200	198	A
100	100	218	216	A
100	100	238	235	A
100	100	240	237	A
100	100	258	255	A
100	100	259	256	E
100	100	260	257	A
100	100	268	265	A
100	100	270	267	A
100	100	278	275	A
100	100	279	276	E
100	100	280	277	A
100	100	281	278	E
100	100	288	285	A
100	100	290	287	A
100	100	298	295	A
100	100	299	296	E
100	100	300	297	A
100	100	301	298	E
100	100	307	304	A
100	100	308	305	E
100	100	310	307	A
100	100	311	308	E
100	100	317	314	A
100	100	318	315	E
100	100	320	317	A
100	100	321	318	E
100	100	327	323	A
100	100	328	324	E
100	100	330	326	A
100	100	331	327	E
100	100	337	333	A
100	100	338	334	E
100	100	340	336	A
100	100	341	337	E
100	100	347	343	A
100	100	348	344	E
100	100	350	346	A
100	100	351	347	E
100	100	357	353	A
100	100	358	354	E
100	100	360	356	A
100	100	361	357	E
100	100	367	363	A
100	100	368	364	E
100	100	370	366	A
100	100	371	367	E
100	100	377	373	A
100	100	378	374	E
100	100	380	376	A
100	100	381	377	E
100	100	387	383	A
100	100	388	384	E
100	100	390	386	A
100	100	391	387	E
100	100	397	393	A
100	100	398	394	E
100	100	400	396	A
100	100	401	397	E
100	100	407	403	A
100	100	408	404	E
100	100	410	406	A
100	100	411	407	E
100	100	417	412	A
100	100	418	413	E
100	100	420	415	A
100	100	421	416	E
100	100	426	421	A
100	100	427	422	E
100	100	430	425	A
100	100	431	426	E
100	100	436	431	A
100	100	437	432	E
100	100	440	435	A
100	100	441	436	E
100	100	446	441	A
100	100	447	442	E
100	100	450	445	A
100	100	451	446	E
100	100	456	451	A
100	100	457	452	E
100	100	460	455	A
100	100	461	456	E
100	100	466	461	A
100	100	467	462	E
100	100	470	465	A
100	100	471	466	E
100	100	476	471	A
100	100	477	472	E
100	100	480	475	A
100	100	481	476	E
100	100	486	481	A
100	100	487	482	E
100	100	490	485	A
100	100	491	486	E
100	100	496	491	A
100	100	497	492	E
100	100	500	495	A
100	100	501	496	E
100	100	521	515	A
100	100	522	516	E
100	100	525	519	A
100	100	526	520	E
100	100	545	539	A
100	100	546	540	E
100	100	550	544	A
100	100	551	545	E
100	100	570	564	A
100	100	571	565	E
100	100	575	569	A
100	100	576	570	E
100	100	595	589	A
100	100	596	590	E
100	100	600	593	A
100	100	601	594	E
100	100	620	613	A
100	100	621	614	E
100	100	625	618	A
100	100	645	638	A
100	100	650	643	A
100	100	651	644	E
100	100	669	662	A
100	100	675	668	A
100	100	694	686	A
100	100	700	692	A
100	100	701	693	E
100	100	719	711	A
100	100	750	742	A

Need more information?

Issued by

Will Ward, Manager, Clearing Operations

Contact information

William Ward

clearing@asx.com.au

OLD SIZE	NEW SIZE	OLD STRIKE (CENTS)	NEW STRIKE (CENTS)	Exercise
100	100	1	1	E
100	100	198	196	A
100	100	200	198	A
100	100	218	216	A
100	100	238	235	A
100	100	240	237	A
100	100	258	255	A
100	100	259	256	E
100	100	260	257	A
100	100	268	265	A
100	100	270	267	A
100	100	278	275	A
100	100	279	276	E
100	100	280	277	A
100	100	281	278	E
100	100	288	285	A
100	100	290	287	A
100	100	298	295	A
100	100	299	296	E
100	100	300	297	A
100	100	301	298	E
100	100	307	304	A
100	100	308	305	E
100	100	310	307	A
100	100	311	308	E
100	100	317	314	A
100	100	318	315	E
100	100	320	317	A
100	100	321	318	E
100	100	327	323	A
100	100	328	324	E
100	100	330	326	A
100	100	331	327	E
100	100	337	333	A
100	100	338	334	E
100	100	340	336	A
100	100	341	337	E
100	100	347	343	A
100	100	348	344	E
100	100	350	346	A
100	100	351	347	E
100	100	357	353	A
100	100	358	354	E
100	100	360	356	A
100	100	361	357	E
100	100	367	363	A
100	100	368	364	E
100	100	370	366	A
100	100	371	367	E
100	100	377	373	A
100	100	378	374	E
100	100	380	376	A
100	100	381	377	E
100	100	387	383	A
100	100	388	384	E
100	100	390	386	A
100	100	391	387	E
100	100	397	393	A
100	100	398	394	E
100	100	400	396	A
100	100	401	397	E
100	100	407	403	A
100	100	408	404	E
100	100	410	406	A
100	100	411	407	E
100	100	417	412	A
100	100	418	413	E
100	100	420	415	A
100	100	421	416	E
100	100	426	421	A
100	100	427	422	E
100	100	430	425	A
100	100	431	426	E
100	100	436	431	A
100	100	437	432	E
100	100	440	435	A
100	100	441	436	E
100	100	446	441	A
100	100	447	442	E
100	100	450	445	A
100	100	451	446	E
100	100	456	451	A
100	100	457	452	E
100	100	460	455	A
100	100	461	456	E
100	100	466	461	A
100	100	467	462	E
100	100	470	465	A
100	100	471	466	E
100	100	476	471	A
100	100	477	472	E
100	100	480	475	A
100	100	481	476	E
100	100	486	481	A
100	100	487	482	E
100	100	490	485	A
100	100	491	486	E
100	100	496	491	A
100	100	497	492	E
100	100	500	495	A
100	100	501	496	E
100	100	521	515	A
100	100	522	516	E
100	100	525	519	A
100	100	526	520	E
100	100	545	539	A
100	100	546	540	E
100	100	550	544	A
100	100	551	545	E
100	100	570	564	A
100	100	571	565	E
100	100	575	569	A
100	100	576	570	E
100	100	595	589	A
100	100	596	590	E
100	100	600	593	A
100	100	601	594	E
100	100	620	613	A
100	100	621	614	E
100	100	625	618	A
100	100	645	638	A
100	100	650	643	A
100	100	651	644	E
100	100	669	662	A
100	100	675	668	A
100	100	694	686	A
100	100	700	692	A
100	100	701	693	E
100	100	719	711	A
100	100	750	742	A

OLD SIZE	NEW SIZE	OLD STRIKE (CENTS)	NEW STRIKE (CENTS)	Exercise
100	100	1	1	E
100	100	198	196	A
100	100	200	198	A
100	100	218	216	A
100	100	238	235	A
100	100	240	237	A
100	100	258	255	A
100	100	259	256	E
100	100	260	257	A
100	100	268	265	A
100	100	270	267	A
100	100	278	275	A
100	100	279	276	E
100	100	280	277	A
100	100	281	278	E
100	100	288	285	A
100	100	290	287	A
100	100	298	295	A
100	100	299	296	E
100	100	300	297	A
100	100	301	298	E
100	100	307	304	A
100	100	308	305	E
100	100	310	307	A
100	100	311	308	E
100	100	317	314	A
100	100	318	315	E
100	100	320	317	A
100	100	321	318	E
100	100	327	323	A
100	100	328	324	E
100	100	330	326	A
100	100	331	327	E
100	100	337	333	A
100	100	338	334	E
100	100	340	336	A
100	100	341	337	E
100	100	347	343	A
100	100	348	344	E
100	100	350	346	A
100	100	351	347	E
100	100	357	353	A
100	100	358	354	E
100	100	360	356	A
100	100	361	357	E
100	100	367	363	A
100	100	368	364	E
100	100	370	366	A
100	100	371	367	E
100	100	377	373	A
100	100	378	374	E
100	100	380	376	A
100	100	381	377	E
100	100	387	383	A
100	100	388	384	E
100	100	390	386	A
100	100	391	387	E
100	100	397	393	A
100	100	398	394	E
100	100	400	396	A
100	100	401	397	E
100	100	407	403	A
100	100	408	404	E
100	100	410	406	A
100	100	411	407	E
100	100	417	412	A
100	100	418	413	E
100	100	420	415	A
100	100	421	416	E
100	100	426	421	A
100	100	427	422	E
100	100	430	425	A
100	100	431	426	E
100	100	436	431	A
100	100	437	432	E
100	100	440	435	A
100	100	441	436	E
100	100	446	441	A
100	100	447	442	E
100	100	450	445	A
100	100	451	446	E
100	100	456	451	A
100	100	457	452	E
100	100	460	455	A
100	100	461	456	E
100	100	466	461	A
100	100	467	462	E
100	100	470	465	A
100	100	471	466	E
100	100	476	471	A
100	100	477	472	E
100	100	480	475	A
100	100	481	476	E
100	100	486	481	A
100	100	487	482	E
100	100	490	485	A
100	100	491	486	E
100	100	496	491	A
100	100	497	492	E
100	100	500	495	A
100	100	501	496	E
100	100	521	515	A
100	100	522	516	E
100	100	525	519	A
100	100	526	520	E
100	100	545	539	A
100	100	546	540	E
100	100	550	544	A
100	100	551	545	E
100	100	570	564	A
100	100	571	565	E
100	100	575	569	A
100	100	576	570	E
100	100	595	589	A
100	100	596	590	E
100	100	600	593	A
100	100	601	594	E
100	100	620	613	A
100	100	621	614	E
100	100	625	618	A
100	100	645	638	A
100	100	650	643	A
100	100	651	644	E
100	100	669	662	A
100	100	675	668	A
100	100	694	686	A
100	100	700	692	A
100	100	701	693	E
100	100	719	711	A
100	100	750	742	A

Notice

South32 Limited (ASX Code: S32) USD $0.03 Special Dividend – Adjustment Implications for S32 ETOs

Need more information?

Issued by

Contact information

Disclaimer

OLD SIZE	NEW SIZE	OLD STRIKE (CENTS)	NEW STRIKE (CENTS)	Exercise
100	100	1	1	E
100	100	198	196	A
100	100	200	198	A
100	100	218	216	A
100	100	238	235	A
100	100	240	237	A
100	100	258	255	A
100	100	259	256	E
100	100	260	257	A
100	100	268	265	A
100	100	270	267	A
100	100	278	275	A
100	100	279	276	E
100	100	280	277	A
100	100	281	278	E
100	100	288	285	A
100	100	290	287	A
100	100	298	295	A
100	100	299	296	E
100	100	300	297	A
100	100	301	298	E
100	100	307	304	A
100	100	308	305	E
100	100	310	307	A
100	100	311	308	E
100	100	317	314	A
100	100	318	315	E
100	100	320	317	A
100	100	321	318	E
100	100	327	323	A
100	100	328	324	E
100	100	330	326	A
100	100	331	327	E
100	100	337	333	A
100	100	338	334	E
100	100	340	336	A
100	100	341	337	E
100	100	347	343	A
100	100	348	344	E
100	100	350	346	A
100	100	351	347	E
100	100	357	353	A
100	100	358	354	E
100	100	360	356	A
100	100	361	357	E
100	100	367	363	A
100	100	368	364	E
100	100	370	366	A
100	100	371	367	E
100	100	377	373	A
100	100	378	374	E
100	100	380	376	A
100	100	381	377	E
100	100	387	383	A
100	100	388	384	E
100	100	390	386	A
100	100	391	387	E
100	100	397	393	A
100	100	398	394	E
100	100	400	396	A
100	100	401	397	E
100	100	407	403	A
100	100	408	404	E
100	100	410	406	A
100	100	411	407	E
100	100	417	412	A
100	100	418	413	E
100	100	420	415	A
100	100	421	416	E
100	100	426	421	A
100	100	427	422	E
100	100	430	425	A
100	100	431	426	E
100	100	436	431	A
100	100	437	432	E
100	100	440	435	A
100	100	441	436	E
100	100	446	441	A
100	100	447	442	E
100	100	450	445	A
100	100	451	446	E
100	100	456	451	A
100	100	457	452	E
100	100	460	455	A
100	100	461	456	E
100	100	466	461	A
100	100	467	462	E
100	100	470	465	A
100	100	471	466	E
100	100	476	471	A
100	100	477	472	E
100	100	480	475	A
100	100	481	476	E
100	100	486	481	A
100	100	487	482	E
100	100	490	485	A
100	100	491	486	E
100	100	496	491	A
100	100	497	492	E
100	100	500	495	A
100	100	501	496	E
100	100	521	515	A
100	100	522	516	E
100	100	525	519	A
100	100	526	520	E
100	100	545	539	A
100	100	546	540	E
100	100	550	544	A
100	100	551	545	E
100	100	570	564	A
100	100	571	565	E
100	100	575	569	A
100	100	576	570	E
100	100	595	589	A
100	100	596	590	E
100	100	600	593	A
100	100	601	594	E
100	100	620	613	A
100	100	621	614	E
100	100	625	618	A
100	100	645	638	A
100	100	650	643	A
100	100	651	644	E
100	100	669	662	A
100	100	675	668	A
100	100	694	686	A
100	100	700	692	A
100	100	701	693	E
100	100	719	711	A
100	100	750	742	A