TWEEN: Overview, definition, and example
What is TWEEN?
TWEEN is a commonly used abbreviation in the financial industry that stands for "to be announced" or "to be negotiated." It typically refers to a period of time during which certain terms, such as the price or other specifics of a deal, have not yet been finalized but are expected to be disclosed or agreed upon shortly. In the context of securities, TWEEN may refer to a security that is in the process of being issued, where key details, such as the exact terms of the offering, are still under negotiation.
For example, during a bond offering, the exact interest rate or terms of the bond may be marked as TWEEN until they are finalized by the issuer and the underwriters.
Why is TWEEN important?
TWEEN is important because it reflects the stage of a transaction or deal where certain elements are still in flux and have not yet been set. It is used to signal to the market, investors, and other involved parties that some details are pending, but a resolution or formal announcement is imminent. For businesses and financial professionals, understanding the TWEEN phase can help with planning and timing for when to expect concrete terms or updates.
For investors, the TWEEN phase indicates that they should be cautious since final details are still subject to change. This phase can have an impact on pricing, terms, and overall investment strategies.
Understanding TWEEN through an example
Let’s say a company is issuing new shares of stock, and the underwriters are in the process of finalizing the price. The company might announce that the price is TWEEN, meaning the price is yet to be determined. In this case, investors would know that the offering is coming soon, but the exact price remains uncertain.
In another example, a corporation is negotiating terms for a new bond issue. The terms of the bond are TWEEN, meaning the interest rate and maturity date have not yet been fixed. Investors will have to wait for the final announcement before they can make investment decisions.
An example of a TWEEN clause
Here’s how a clause like this might appear in a contract:
“The specific terms of the bond offering, including the interest rate and final pricing, are TWEEN and will be announced in accordance with the schedule provided by the issuer.”
Conclusion
TWEEN refers to a state of uncertainty or a "pending" phase in financial transactions, where certain details of the deal have not yet been finalized. It is used to alert parties involved in the deal that specific terms, such as price or terms of a financial product, are still under negotiation. For businesses and investors, understanding when something is in a TWEEN state helps manage expectations and plan for when full details will be available.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.