The Securities Lending Agreement is a crucial document used in UAE financial markets to facilitate the temporary transfer of securities between financial institutions. This agreement is essential for market making, settlement coverage, and enhanced portfolio returns, while ensuring compliance with UAE regulatory requirements, particularly those set by the Securities and Commodities Authority (SCA) and the Central Bank of UAE. The document addresses key aspects including loan terms, collateral requirements, rights and obligations of parties, default procedures, and regulatory compliance. It is particularly relevant for institutions operating in UAE financial markets, including conventional and Islamic financial institutions, and must incorporate specific provisions required by UAE law while aligning with international securities lending practices.

1. Parties: Identification of the lender and borrower, including their regulatory status and capacity

2. Background: Recitals explaining the purpose of the agreement and parties' authority to enter into securities lending transactions

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

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

5. Transfer of Securities and Collateral: Mechanics and requirements for transferring securities and collateral

6. Collateral Requirements: Rules for calculating, delivering, and maintaining collateral, including margin requirements

7. Income and Corporate Actions: Treatment of dividends, rights issues, and other corporate actions affecting loaned securities

8. Rates and Fees: Lending fees, rebate rates, and other economic terms

9. Tax Provisions: Handling of tax matters, including withholding tax and manufactured payments

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

11. Close-out and Set-off: Procedures for terminating transactions and calculating settlement amounts

12. Representations and Warranties: Standard and specific representations regarding capacity, authority, and compliance

13. Covenants: Ongoing obligations of the parties

14. Indemnities: Scope of indemnification obligations

15. Termination: Terms for ending the agreement and individual transactions

16. Notices: Communication procedures and contact details

17. Governing Law and Jurisdiction: UAE law as governing law and jurisdiction provisions