Share Lending Agreement Template for Philippines

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Key Requirements PROMPT example:

Share Lending Agreement

"I need a Share Lending Agreement for a Philippine bank lending blue-chip shares to a licensed broker-dealer, with collateral requirements set at 102% and including specific provisions for corporate actions during the lending period."

Document background
The Share Lending Agreement is a critical document used in Philippine financial markets to facilitate securities lending transactions between financial institutions. It becomes necessary when one party wishes to temporarily transfer shares to another party, typically for purposes such as short selling, market making, or settlement coverage. The agreement must comply with Philippine regulatory requirements, particularly the Securities Regulation Code (Republic Act No. 8799) and SEC Memorandum Circular No. 7 (Series of 2006). This document establishes the legal framework for the loan, including detailed provisions on collateral requirements, corporate actions, voting rights, fees, and return obligations. It's essential for maintaining market liquidity and supporting sophisticated trading strategies while ensuring proper risk management and regulatory compliance within the Philippine jurisdiction.
Suggested Sections

1. Parties: Identification of the lender and borrower, including their complete legal names, addresses, and registration details

2. Background: Context of the agreement, including the purpose of the share lending arrangement and the parties' authority to enter into it

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

4. Loan of Securities: Core provisions regarding the lending of shares, including the process and conditions for lending

5. Delivery and Return: Procedures and timing for the delivery of loaned shares and their eventual return

6. Collateral: Requirements for collateral, including type, value, maintenance, and margin calls

7. Rights and Obligations: Detailed responsibilities of each party during the loan period

8. Fee Structure: Lending fees, payment terms, and calculation methods

9. Representations and Warranties: Standard and specific representations made by each party

10. Events of Default: Circumstances constituting default and consequences

11. Termination: Conditions and process for terminating the agreement

12. Tax Matters: Treatment of taxes, including withholding taxes and tax indemnities

13. Notices: Communication procedures between parties

14. Governing Law and Jurisdiction: Specification of Philippine law as governing law and jurisdiction for disputes

Optional Sections

1. Corporate Actions: Provisions dealing with dividends, rights issues, and other corporate actions during the loan period - include if shares may be subject to corporate actions

2. Market Disruption: Procedures in case of market disruption events - include for listed securities

3. Voting Rights: Arrangements for exercising voting rights during the loan period - include if voting rights are relevant

4. Securities Intermediary: Provisions regarding any intermediary's role - include if using a custodian or broker

5. Foreign Exchange: Currency conversion provisions - include if cross-border lending is involved

6. Regulatory Compliance: Additional regulatory requirements - include if parties are regulated entities

Suggested Schedules

1. Schedule 1 - Eligible Securities: List of securities eligible for lending under the agreement, including any specific conditions

2. Schedule 2 - Fee Schedule: Detailed breakdown of fees, calculations, and payment terms

3. Schedule 3 - Form of Loan Notice: Standard form for requesting and confirming securities loans

4. Schedule 4 - Collateral Requirements: Detailed specifications for acceptable collateral and haircuts

5. Schedule 5 - Settlement Procedures: Operational details for settlement of loans and returns

6. Appendix A - Contact Details: List of authorized representatives and contact information for both parties

7. Appendix B - Required Documentation: List of documents required for regulatory compliance and due diligence

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

Relevant legal definitions
Clauses
Relevant Industries

Banking

Financial Services

Investment Management

Securities Trading

Asset Management

Brokerage Services

Capital Markets

Wealth Management

Corporate Finance

Investment Banking

Relevant Teams

Legal

Compliance

Trading

Risk Management

Operations

Investment Management

Portfolio Management

Securities Operations

Finance

Regulatory Affairs

Settlement

Custody

Relevant Roles

Legal Counsel

Compliance Officer

Securities Trading Manager

Risk Manager

Operations Director

Investment Manager

Portfolio Manager

Securities Lending Specialist

Trading Desk Manager

Chief Financial Officer

Legal Director

Regulatory Affairs Manager

Settlement Officer

Custody Operations Manager

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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