Stock Management Agreement for India

Stock Management Agreement Template for India

A comprehensive legal agreement governed by Indian law that establishes the terms and conditions for professional stock management services. This document outlines the responsibilities of stock managers, investment procedures, compliance requirements under Indian securities laws, reporting obligations, and risk management protocols. It incorporates provisions compliant with SEBI regulations, the Companies Act 2013, and other relevant Indian legislation, while defining the scope of services, fee structures, and operational procedures for effective stock portfolio management.

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What is a Stock Management Agreement?

The Stock Management Agreement serves as a crucial legal framework for entities seeking professional management of their stock portfolios in India. This document is essential when engaging professional stock management services, whether for corporate entities, institutional investors, or high-net-worth individuals. The agreement ensures compliance with Indian regulatory requirements, including SEBI guidelines, Companies Act 2013, and relevant securities laws. It typically covers comprehensive details about investment strategies, risk management, reporting requirements, fee structures, and operational procedures. The Stock Management Agreement is particularly important in the Indian context due to the complex regulatory environment and the need for clear delineation of responsibilities in stock management relationships.

What sections should be included in a Stock Management Agreement?

1. Parties: Identifies and provides details of all parties to the agreement

2. Background: Sets out the context and purpose of the agreement

3. Definitions and Interpretation: Defines key terms and establishes rules for interpreting the agreement

4. Appointment and Scope: Details the appointment of the stock manager and scope of services

5. Rights and Obligations: Specifies the rights and obligations of all parties

6. Operating Procedures: Details the procedures for stock management, including trading, custody, and reporting

7. Fees and Expenses: Specifies all fees, charges, and expense allocation

8. Representations and Warranties: Contains statements of fact and assurances from all parties

9. Compliance and Reporting: Outlines regulatory compliance requirements and reporting obligations

10. Confidentiality: Governs the handling of confidential information

11. Liability and Indemnification: Addresses liability limitations and indemnification obligations

12. Term and Termination: Specifies duration, renewal, and termination provisions

13. Dispute Resolution: Sets out procedures for resolving disputes

14. General Provisions: Contains standard boilerplate clauses

What sections are optional to include in a Stock Management Agreement?

1. Foreign Investment Compliance: Required when foreign investors are involved, detailing FEMA compliance

2. Electronic Trading Provisions: Include when electronic trading platforms will be used

3. Portfolio Valuation: Required for agreements involving portfolio management services

4. Sub-delegation: Include when sub-delegation of management functions is permitted

5. Insurance: Required when specific insurance coverage needs to be maintained

6. Force Majeure: Optional section for dealing with unforeseen circumstances

7. Anti-Money Laundering: Required for agreements with enhanced compliance requirements

8. Performance Benchmarks: Include when specific performance metrics are to be tracked

What schedules should be included in a Stock Management Agreement?

1. Schedule 1 - Services Description: Detailed description of stock management services

2. Schedule 2 - Fee Schedule: Detailed breakdown of all fees and charges

3. Schedule 3 - Operating Procedures: Detailed procedures for day-to-day operations

4. Schedule 4 - Authorized Personnel: List of authorized representatives and signatories

5. Schedule 5 - Reporting Requirements: Details of required reports and their frequency

6. Schedule 6 - Investment Guidelines: Specific guidelines and restrictions for stock management

7. Appendix A - Power of Attorney: Standard form of power of attorney if required

8. Appendix B - Compliance Checklist: Regulatory compliance requirements checklist

9. Appendix C - Account Opening Forms: Standard forms for opening trading and demat accounts

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

India

Publisher

Genie AI

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Financial Services

Investment Management

Banking

Securities Trading

Asset Management

Wealth Management

Corporate Services

Investment Banking

Private Equity

Venture Capital

Relevant Teams

Legal

Compliance

Investment Management

Risk Management

Operations

Finance

Treasury

Portfolio Management

Corporate Affairs

Client Relations

Relevant Roles

Portfolio Manager

Investment Manager

Compliance Officer

Risk Manager

Chief Investment Officer

Legal Counsel

Financial Controller

Investment Analyst

Fund Manager

Operations Manager

Chief Financial Officer

Relationship Manager

Corporate Secretary

Treasury Manager

Investment Director

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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