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The Stock Borrowing Agreement is essential for financial institutions operating in Canadian markets that engage in securities lending transactions. This agreement is typically used when one financial institution needs to borrow securities for various purposes, including short selling, covering settlement failures, or supporting trading strategies. The document comprehensively addresses regulatory requirements under Canadian federal and provincial laws, including securities regulations, tax implications, and financial institution oversight. It details the mechanisms for transferring securities, managing collateral, handling corporate actions, and addressing default scenarios. The agreement must comply with requirements set by provincial securities regulators, IIROC, and where applicable, OSFI guidelines for federally regulated institutions.

1. Parties: Identification of the lender and borrower, including full legal names and addresses

2. Background: Context of the agreement and brief description of the parties' intentions

3. Definitions and Interpretation: Definitions of key terms and interpretation rules used throughout the agreement

4. Loans of Securities: Core provisions governing the borrowing and lending of securities, including initiation process and confirmation requirements

5. Transfer of Securities: Mechanics and requirements for the transfer of borrowed securities

6. Collateral Requirements: Specifications for acceptable collateral, valuation methods, and maintenance requirements

7. Margin Maintenance: Procedures for calculating and maintaining required margin levels

8. Income and Corporate Actions: Treatment of dividends, interest, and other corporate actions affecting borrowed securities

9. Fees and Charges: Borrowing fees, payment calculations, and payment procedures

10. Tax Provisions: Tax obligations, withholding requirements, and tax-related representations

11. Events of Default: Definition of default events and consequences

12. Close-out and Set-off: Procedures for terminating loans and settling obligations

13. Representations and Warranties: Standard and specific representations by both parties

14. Covenants: Ongoing obligations of the parties

15. Indemnification: Indemnification obligations and procedures

16. Term and Termination: Duration of agreement and termination rights

17. Notices: Communication requirements and contact details

18. Governing Law and Jurisdiction: Choice of law and jurisdiction for dispute resolution

19. General Provisions: Standard boilerplate provisions including amendments, assignments, and severability