Interest on Outstanding Payments - GMSLA Provision

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2010 Global Master Securities Lending Agreement
A Jolly Contrarian owner’s manual

Clause 15 in a Nutshell
Use at your own risk, campers!

15. Interest: If either Party fails to make payments when due it must pay interest on the outstanding balance between the original due date and the date of actual payment at the default interest rate set out in paragraph 11.7. Interest will compound and accrue daily on an actual/actual basis. No interest is payable on any day where one Party tries to make a payment the other cannot receive it.
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Clause 15 in full

15. Interest on Outstanding Payments
In the event of either Party failing to remit sums in accordance with this Agreement such Party hereby undertakes to pay to the other Party upon demand interest (before as well as after judgment) on the net balance due and outstanding, for the period commencing on and inclusive of the original due date for payment to (but excluding) the date of actual payment, in the same currency as the principal sum and at the rate referred to in paragraph 11.7. Interest will accrue daily on a compound basis and will be calculated according to the actual number of days elapsed. No interest shall be payable under this paragraph in respect of any day on which one Party endeavours to make a payment to the other Party but the other Party is unable to receive it.
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Related agreements and comparisons

Related agreements: Click here for the same clause in the 2018 Pledge GMSLA
Comparison: None required: the clauses are the same.

Resources and navigation

2010 GMSLA: Full wikitext · Nutshell wikitext | GMLSA legal code
Pledge GMSLA: Hard copy (ISLA) · Full wikitext · Nutshell wikitext |
1995 OSLA: Full wikitext · Nutshell wikitext | GMSLA Netting
Let me Google that for you: Guide to equity finance | ISLA’s guide to securities lending for regulators and policy makers
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2018 Pledge GMSLA 1 · 2 · 3 · 4 · 5 · 6 · 7 · 8 · 9 · 10 · 11 · 12 · 13 · 14 · 15 · 16 · 17 · 18 · 19 · 20 · 21 · 22 · 23 · 24 · 25 · 26 · 27 · 28 · Schedule · Agency Annex

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Content and comparisons

Clause 15 of the 2010 GMSLA is identical to Clause 15 of the 2018 Pledge GMSLA. Note the sneaky reference to the default interest rate drafting in Clause 11.7, which falls back to — dramatic look gopher — LIBOR, and means that 11.7 isn’t, after all, restricted only to professional fees. This is absolutely dreadful drafting from ISLA’s crack drafting squad™.
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Summary

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General discussion

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See also

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References