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 While legal systems differ on the precise reasons for which a contract may be rescinded, it may occur due to an act of God or by mutual consent, provided that no substantial progress has been made toward completion of the contract. In the context of finance and economics, some contracts may be rescinded up to a certain point after they come into effect.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 Likewise, the sale of land may be rescinded by either party up to the point the sale is recorded. Sometimes an option contract, especially a stock option, can be rescinded for a certain time after its exercise; in this situation, the person who exercised the option surrenders the underlying in exchange for the cash he/she paid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 ?
46] A developer should note, however, that a no-action letter does not retroactively apply to past sales, and all purchasers will continue to have all remedies available under ILSA, including the two-year rescission right, even if a no-action letter is issued.
A condominium developer's ability to correctly interpret ILSA's provisions is essential in order to avoid financial exposure to proceedings by HUD and purchasers, most notably, the two-year rescission right, as well as to provide comfort to a construction lender concerned with the act's ramifications.
The sponsors of Linden78, a 33-unit condominium at 230 West 78th Street, offered rescission rights to all of the project's buyers in mid-April, according to a statement provided exclusively to The Real Deal from the developer, Urban Residential.