rescission

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Rescission

The act of abolishing a contract and restoring, as far as possible, the status quo ante. While legal systems differ on the precise reasons for which a contract may be rescinded, it may occur due to an act of God or by mutual consent, provided that no substantial progress has been made toward completion of the contract. In the context of finance and economics, some contracts may be rescinded up to a certain point after they come into effect. For example, some mortgage refinance contracts allow the homeowner a period of three business days after signing the contract in which he/she may unilaterally rescind it. Likewise, the sale of land may be rescinded by either party up to the point the sale is recorded. Sometimes an option contract, especially a stock option, can be rescinded for a certain time after its exercise; in this situation, the person who exercised the option surrenders the underlying in exchange for the cash he/she paid for it.

rescission

The cancellation of a previous exercise of an incentive stock option, generally because of a substantial drop in the price of the stock acquired through the exercise. Rescission results in the employee surrendering stock in exchange for money that was paid for the stock.

rescission

See rescind.

References in periodicals archive ?
80-58, a successful tax rescission has two prerequisites:
Under no circumstances, regardless of the comments made by the insurance commissioner, can the rescission be illegal.
The disagreement was significant enough that the parties determined to rescind the investment through a "stock rescission agreement.
Both the House and Senate recommended a $90 million rescission from amounts previously earmarked for lead based paint hazard reduction activities.
Congress must show that it is serious about controlling spending by passing legislation giving the president expedited rescission authority.
The settlement is the result of extensive negotiations that have been ongoing between HLB and Health Net since July 2008, and covers rescissions by Health Net that occurred between February 2004 and October 2007.
The class action and amended complaint follow lawsuits that were filed by Hooper, Lundy & Bookman in May, 2006, on behalf of a number of specific hospital clients, challenging these types of retroactive policy rescissions.
The rescissions, however, directly impact the hospitals and physicians, because they are not being paid for their services, and instead are being directed by Blue Cross to collect from the patients.
Refer to our Form 8-K filed with the Securities and Exchange Commission on April 21, 2015 for information about our suspension of certain rescissions and the number of rescissions suspended as of March 31, 2015.
This class action complaint also follows lawsuits that were filed by Hooper, Lundy & Bookman in May of this year, on behalf of other hospitals challenging these types of retroactive policy rescissions.
Refer to our Form 10-K filed with the Securities and Exchange Commission on February 27, 2015 for information about our suspension of certain rescissions and the number of rescissions suspended as of December 31, 2014.
Certain of the option-holders, including the former officer, are contesting these rescissions, and it is improbable that the Company will be able to rescind all of them.