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Equity Loan Agreement
"I need a Swiss-law Equity Loan Agreement between our bank (acting as lender) and a German pension fund (as borrower), with specific provisions for cross-border transactions and automated collateral management through SIX Securities Services, planned to be effective from March 1, 2025."
1. Parties: Identification of the lender and borrower, including their full legal names, registration details, and addresses
2. Background: Context of the agreement and brief description of the parties' intentions regarding the equity loan arrangement
3. Definitions and Interpretation: Definitions of key terms used throughout the agreement and rules of interpretation
4. Loan of Securities: Core terms of the securities loan, including identification of securities, loan period, and transfer mechanisms
5. Delivery and Return: Procedures and timing for the delivery of loaned securities and their eventual return
6. Collateral: Requirements for collateral, including type, value, maintenance, and margin calls
7. Fees and Payments: Loan fees, payment schedules, and calculation methods
8. Corporate Actions: Treatment of dividends, rights issues, and other corporate actions during the loan period
9. Representations and Warranties: Standard representations and warranties from both parties
10. Tax Provisions: Treatment of taxes, including withholding tax and manufactured dividends
11. Events of Default: Definition of default events and consequences
12. Termination: Circumstances and procedures for early termination
13. Governing Law and Jurisdiction: Confirmation of Swiss law governance and jurisdiction for disputes
14. Notices: Communication procedures and contact details
15. General Provisions: Standard boilerplate clauses including severability, amendments, and entire agreement
1. Regulatory Compliance: Specific provisions addressing compliance with Swiss financial regulations, used when parties are regulated entities
2. Multiple Borrowers/Lenders: Additional provisions for agreements involving multiple parties on either side
3. Cross-Border Provisions: Special provisions for international transactions, including conflict of laws
4. Electronic Trading Platform: Provisions for agreements executed through electronic platforms
5. Custody Arrangements: Specific provisions when involving third-party custodians
6. Netting Arrangements: Provisions for netting of obligations, used in more complex lending relationships
7. Agency Provisions: Required when one or more parties act as agents rather than principals
8. Credit Support: Additional credit support arrangements beyond standard collateral requirements
1. Schedule 1 - Loaned Securities: Detailed description of the securities to be loaned, including ISIN numbers and quantities
2. Schedule 2 - Fee Schedule: Detailed breakdown of fees, calculation methods, and payment terms
3. Schedule 3 - Collateral Requirements: Specific collateral parameters, including haircuts and eligible collateral types
4. Schedule 4 - Operating Procedures: Detailed procedures for transfers, corporate actions, and communications
5. Appendix A - Form of Loan Confirmation: Template for confirming individual loan transactions
6. Appendix B - Notice Details: Detailed contact information and notice requirements for both parties
7. Appendix C - Tax Documentation: Required tax forms and declarations
8. Appendix D - Settlement Instructions: Detailed instructions for securities and collateral transfers
Authors
Financial Services
Banking
Investment Management
Securities Trading
Asset Management
Insurance
Financial Technology
Investment Banking
Wealth Management
Capital Markets
Legal
Compliance
Trading Operations
Risk Management
Portfolio Management
Securities Operations
Collateral Management
Trading
Settlement
Financial Control
Securities Finance
Regulatory Reporting
Investment
Treasury
Middle Office
Securities Lending Manager
Legal Counsel
Compliance Officer
Trading Operations Manager
Risk Manager
Portfolio Manager
Securities Operations Specialist
Collateral Manager
Trading Desk Manager
Settlement Officer
Financial Controller
Head of Securities Finance
Regulatory Reporting Officer
Investment Director
Chief Investment Officer
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