WHAT WE DO:
Portage works with Issuers that have chilled securities in an advisory capacity to assemble the strongest possible case for the DTC to lift the chill. In addition to our significant experience with the DTC, Portage’s strategic relationships with securities attorneys, clearing firms, market makers, broker dealers, and transfer agents enable us to actively engage with the relevant stakeholders in order to address the causes of the DTC chill.
BACKGROUND: What is a Chill?
The Depository Trust & Clearing Corporation and its wholly owned subsidiary, the Depository Trust Company, can impose transaction restrictions, generally referred to as “Chills”, when it has cause to be concerned about a specific security currently processed through its system. Chill restrictions are intended to limit the potential for problems within the financial marketplace, and can be placed on a security for various reasons. Occasionally, DTC may need to chill certain transactions such as deposits, withdrawals-by-transfers, or deliver orders, or may need to restrict all these services for operational, risk management or regulatory and compliance reasons.
Since 2010, the number of instances in which the DTC has imposed chills on eligible securities has increased, as has the number of customer queries regarding transaction restrictions. The number of chills imposed is still a relatively small number when compared to the number of eligible securities in DTC’s system. However, for Issuers that have a chill imposed on its securities and the owners of those securities, the chill can quickly become a major challenge. Issuers seeking solutions or a method to get a chill “lifted” will experience frustration in trying to appeal directly to the DTC.