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Stock Borrowing Agreement
"I need a Stock Borrowing Agreement for use between our investment bank and multiple hedge fund clients, with specific provisions for automated trading systems and real-time collateral management, compliant with New Zealand regulations."
1. Parties: Identification of the lender and borrower, including registration details and addresses
2. Background: Context of the agreement and relationship between parties
3. Definitions and Interpretation: Key terms used throughout the agreement and rules for interpretation
4. Loans of Securities: Core provisions governing the borrowing and lending of securities
5. Delivery of Securities: Procedures and timing for delivering borrowed securities
6. Collateral Requirements: Terms regarding posting and maintaining collateral
7. Rights and Obligations: Specific rights and obligations of both parties during the lending period
8. Fees and Charges: Borrowing fees, charges, and payment terms
9. Tax and Dividends: Treatment of dividends, corporate actions, and tax implications
10. Events of Default: Definition of default events and consequences
11. Termination: Conditions and procedures for terminating the agreement
12. Representations and Warranties: Standard declarations by both parties
13. Indemnification: Indemnity provisions and allocation of risks
14. Notices: Communication procedures between parties
15. General Provisions: Standard boilerplate clauses including governing law, jurisdiction, etc.
1. Agency Provisions: Required when either party acts as an agent for underlying clients
2. Regulatory Compliance: Specific section for enhanced regulatory requirements when dealing with regulated entities
3. Electronic Trading: Include when parties will use electronic platforms for lending transactions
4. Central Counterparty Provisions: Required when transactions will be cleared through a central counterparty
5. Margin Maintenance: Detailed margin requirements when parties agree to specific margin thresholds
6. Securities Rehypothecation: Include when borrower is permitted to re-use borrowed securities
7. Foreign Securities Provisions: Required when agreement covers international securities
1. Schedule 1 - Eligible Securities: List of securities that may be borrowed under the agreement
2. Schedule 2 - Fee Schedule: Detailed breakdown of fees and charges
3. Schedule 3 - Collateral Requirements: Specific collateral criteria and haircuts
4. Schedule 4 - Operating Procedures: Detailed operational procedures for borrowing and returning securities
5. Schedule 5 - Form of Loan Confirmation: Standard form for confirming individual loan transactions
6. Schedule 6 - Authorized Persons: List of authorized signatories and traders
7. Appendix A - Standard Settlement Instructions: Settlement and payment instructions for both parties
8. Appendix B - Tax Documentation: Required tax forms and declarations
Authors
Financial Services
Banking
Investment Management
Securities Trading
Asset Management
Insurance
Pension Fund Management
Prime Brokerage
Capital Markets
Financial Technology
Legal
Compliance
Risk Management
Trading Operations
Securities Operations
Portfolio Management
Collateral Management
Settlement
Credit Risk
Treasury
Financial Control
Investment Operations
Trading Desk
Client Relations
Securities Lending Manager
Trading Operations Manager
Legal Counsel
Compliance Officer
Risk Manager
Portfolio Manager
Securities Operations Specialist
Collateral Manager
Trading Desk Manager
Settlement Officer
Relationship Manager
Credit Risk Analyst
Financial Controller
Investment Operations Manager
Treasury Manager
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