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| {{gmslaprov|8.1}} {{gmslaprov|Lender’s right to terminate a Loan}} <br> | | {{gmslaprov|8.1}} {{gmslaprov|Lender’s right to terminate a Loan}} <br> |
Revision as of 09:09, 4 May 2018
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GMSLA Anatomy™
In a Nutshell™ Clause 8:
8. Delivery of Equivalent Securities
8.1: Lender’s right to terminate a Loan: Unless it is a term Loan, Lender may terminate a Loan and call for Equivalent Securities by giving notice on any Business Day. Lender must allow the Borrower at least the standard settlement cycle to return Equivalent Securities.
8.2 Borrower’s right to terminate a Loan: The Borrower may terminate a Loan at any time and deliver outstanding Equivalent Securities to Lender per its instructions. The Lender must accept such delivery.
8.3 Delivery of Equivalent Securities on termination of a Loan: On termination of the Loan, Borrower will Deliver Equivalent Securities to Lender in accordance with the terms of the Loan.
8.4 Delivery of Equivalent Collateral on termination of a Loan: At the point where Borrower is obliged to deliver Equivalent Securities to Lender on termination of a Loan, Lender must simultaneously deliver to Borrower Equivalent Collateral orCash Collateral relating to the Loan.
8.5 Delivery of Letters of Credit: Where Collateral takes the form of a Letter of Credit, the Lender can satisfy its obligation to redeliver Equivalent Collateral by delivering the Letter of Credit for cancellation, or consenting to a reduction in its value.
8.6 Delivery obligations to be reciprocal: Neither Party has to pay or deliver anything unless it is satisfied that the other Party will make the corresponding payment or delivery to it. If it is not, as long as it is willing and able to perform its own obligations it may, by notice to the other Party, withhold delivery or payment until the other Party has made sufficient arrangements to assure full delivery or payment.
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2010 GMSLA full text of Clause 8:
8. Delivery of Equivalent Securities
8.1 Lender’s right to terminate a Loan
Subject to paragraph 11 and the terms of the relevant Loan, Lender shall be entitled to terminate a Loan and to call for the delivery of all or any Equivalent Securities at any time by giving notice on any Business Day of not less than the standard settlement time for such Equivalent Securities on the exchange or in the clearing organisation through which the Loaned Securities were originally delivered. Borrower shall deliver such Equivalent Securities not later than the expiry of such notice in accordance with Lender’s instructions.
8.2 Borrower’s right to terminate a Loan
Subject to the terms of the relevant Loan, Borrower shall be entitled at any time to terminate a Loan and to deliver all and any Equivalent Securities due and outstanding to Lender in accordance with Lender’s instructions and Lender shall accept such delivery.
8.3 Delivery of Equivalent Securities on termination of a Loan
Borrower shall procure the Delivery of Equivalent Securities to Lender or deliver Equivalent Securities in accordance with this Agreement and the terms of the relevant Loan on termination of the Loan. For the avoidance of doubt any reference in this Agreement or in any other agreement or communication between the Parties (howsoever expressed) to an obligation to deliver or account for or act in relation to Loaned Securities shall accordingly be construed as a reference to an obligation to deliver or account for or act in relation to Equivalent Securities.
8.4 Delivery of Equivalent Collateral on termination of a Loan
On the date and time that Equivalent Securities are required to be delivered by Borrower on the termination of a Loan, Lender shall simultaneously (subject to paragraph 5.4 if applicable) repay to Borrower any Cash Collateral or, as the case may be, deliver Collateral equivalent to the Collateral provided by Borrower pursuant to paragraph 5 in respect of such Loan. For the avoidance of doubt any reference in this Agreement or in any other agreement or communication between the Parties (however expressed) to an obligation to deliver or account for or act in relation to Collateral shall accordingly be construed as a reference to an obligation to deliver or account for or act in relation to Equivalent Collateral.
8.5 Delivery of Letters of Credit
Where a Letter of Credit is provided by way of Collateral, the obligation to deliver Equivalent Collateral is satisfied by Lender delivering for cancellation the Letter of Credit so provided, or where the Letter of Credit is provided in respect of more than one Loan, by Lender consenting to a reduction in the value of the Letter of Credit.
8.6 Delivery obligations to be reciprocal
Neither Party shall be obliged to make delivery (or make a payment as the case may be) to the other unless it is satisfied that the other Party will make such delivery (or make an appropriate payment as the case may be) to it. If it is not so satisfied (whether because an Event of Default has occurred in respect of the other Party or otherwise) it shall notify the other Party and unless that other Party has made arrangements which are sufficient to assure full delivery (or the appropriate payment as the case may be) to the notifying Party, the notifying Party shall (provided it is itself in a position, and willing, to perform its own obligations) be entitled to withhold delivery (or payment, as the case may be) to the other Party until such arrangements to assure full delivery (or the appropriate payment as the case may be) are made.
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8. Delivery of Equivalent Securities
8.1 Lender’s right to terminate a Loan
8.2 Borrower’s right to terminate a Loan
8.3 Delivery of Equivalent Securities on termination of a Loan
8.4 Delivery of Equivalent Collateral on termination of a Loan
8.5 Delivery of Letters of Credit
8.6 Delivery obligations to be reciprocal