Euroclear Pledge Agreement

Transcription

1 Euroclear Pledge Agreement Pursuant to Chapter IX Part 2 Number Paragraph (2) between as Lender Clearing Member and Eurex Clearing AG, Frankfurt/Main.

2 This Euroclear Pledge Agreement (the "Agreement") is dated 1 and entered into BETWEEN: (1) (legal name) acting through / having its ( registered) office at, as Lender Clearing Member (the "Lender"); and (2) Eurex Clearing Aktiengesellschaft, a stock company (Aktiengesellschaft) incorporated under the laws of the Federal Republic of Germany, registered in the commercial register of the local court (Amtsgericht) in Frankfurt am Main under HRB and having its registered office at Mergenthalerallee 61, Eschborn, Federal Republic of Germany ("Eurex Clearing AG"). The Lender and Eurex Clearing AG are hereinafter also referred to as the "Parties" and each of them as a "Party" WHEREAS: (A) (B) (C) (D) The Parties have entered into a clearing agreement (the "Clearing Agreement") which incorporates Eurex Clearing AG's clearing conditions (the "Clearing Conditions") and which includes a Clearing Licence for the Lender to clear Securities Lending Transactions. With respect to each Relevant Lending Set (as defined below), Eurex Clearing AG is obliged to deliver Non-Cash Principal Collateral to the Lender Clearing Member by way of a pledge, as further set out in the Clearing Conditions. The Lender and Eurex Clearing AG are participants in the Euroclear System (as defined below). This Agreement sets out the terms and conditions for each Pledge granted by Eurex Clearing AG with respect to, as described in the relevant Loan Information, a particular Securities Lending Transaction (hereinafter the "Particular Securities Lending Transaction") or all Securities Lending Transactions of an Exposure Netting Unit (hereinafter the "Particular Exposure Netting Unit") (each Particular Securities Lending Transaction or Particular Exposure Netting Unit constitutes a "Relevant Lending Set"). 1 Date will be provided by Eurex Clearing AG 1

3 NOW THEREFORE, the Parties agree as follows: 1 Interpretation 1.1 Definitions Unless the context requires otherwise, terms used in this Agreement shall have the meaning given to them in the Clearing Conditions and: "Additional Terms" means the additional terms and conditions relating to, among others, the SLSA Terms and Conditions, SLSA Operating Procedures, the SPPA Terms and Conditions and the SPPA Terms and Conditions Acceptance Agreement, entered into by the Lender, Eurex Clearing AG and Euroclear in connection with this Agreement and as amended from time to time. "AutoSelect Processing" has the meaning given to it in the SLSA Terms and Conditions. "Business Days" means the days determined by the Executive Board of Eurex Clearing AG as defined under Chapter I Part 1 Number Paragraph (1) (g) of the Clearing Conditions. "Corporate Events" means the events listed under Chapter 7 (Income, Redemption and Other Entitlements) of the SLSA Operating Procedures. "Enforcement Event" means the non-delivery or non-payment of the Secured Liabilities (when due) after giving notice thereof by the Lender to Eurex Clearing AG and Euroclear and the expiry of a grace period of at least 5 Business Days, except that no grace period shall apply where such notice is given further to an Insolvency Event of Eurex Clearing AG as referred to in Chapter IX Part 2 Number Paragraph (5) of the Clearing Conditions. "Euroclear" means Euroclear Bank NV/SA, a financial institution organised and existing under the laws of Belgium, recognised as a settlement institution (vereffeningsinstelling / organisme de liquidation) for the purpose of Royal Decree No. 62 and having its registered office at 1, boulevard du Roi Albert II, 1210 Brussels, Belgium, as operator of the Euroclear System. "Euroclear System" means the clearance and settlement system for internationally traded securities operated by Euroclear, including all services offered by Euroclear in respect of securities held or recorded in any account as set forth in the terms and conditions governing use of Euroclear or in the operating procedures of the Euroclear System. "Financial Collateral Law" means the Belgian law of 15 December 2004 on financial collateral arrangements. "Financial Supervision Law" means the Belgian law of 2 August 2002 on the supervision on the financial sector and the financial services. "Pledge" means, with respect to a Relevant Lending Set, the first ranking pledge (gage de premier rang/pand in eerste rang) created by or pursuant to this Agreement. "Pledged Accounts" means the Pledged Accounts as defined under the SPPA Terms and Conditions. "Pledged Assets" means, with respect to a Relevant Lending Set, the Non-Cash Principal Collateral credited to the Pledged Securities Account (as defined under the SPPA Terms and Conditions) for the purpose of securing the Secured Liabilities with respect to such 2

4 Relevant Lending Set and any cash credited on the Pledged Cash Account (as defined under the SPPA Terms and Conditions) in relation to the above Non-Cash Principal Collateral not including, for the avoidance of doubt, any other securities or cash credited to other Pledged Securities Accounts or Cash Accounts opened in the name of Eurex Clearing AG for the purpose of securing any other Securities Lending Transaction(s). "Royal Decree No. 62" means the Belgian Royal Decree No. 62 of 10 November 1967 concerning the custody and clearing of fungible financial instruments. "Secured Liabilities" means Eurex Clearing AG s obligation to (i) deliver the Equivalent Loaned Securities on the Maturity Date, (ii) to pay the applicable cash amount in relation to Distributions, Fractions, Compensation Amounts or replacing the obligation to deliver Equivalent Loaned Securities on the Maturity Date or (iii) to repay any loaned cash amount in respect of a Reverse Securities Loan, in each case with regard to the Relevant Lending Set only. For the avoidance of doubt, the Secured Liabilities will not include a Difference Claim of the Lender Clearing Member against Eurex Clearing AG upon the occurrence of a Termination with respect to the Lender Clearing Member or a Difference Claim of the Lender Clearing Member against Eurex Clearing AG in the event of a close-out with respect to Eurex Clearing AG pursuant to Chapter I Part 1 Number 9 of the Clearing Conditions. "SLSA Operating Procedures" means the Securities Lending Service Agreement Operating Procedures, entered into by the Lender, Eurex Clearing AG and Euroclear, as amended by the Additional Terms. "SLSA Terms and Conditions" means the Securities Lending Service Agreement Terms and Conditions, entered into by the Lender, Eurex Clearing AG and Euroclear as amended by the Additional Terms. "SPPA Terms and Conditions" means the Single Pledgor Pledged Account Terms and Conditions, entered into by the Lender, Eurex Clearing AG and Euroclear in connection with this Agreement through the SPPA Terms and Conditions Acceptance Agreement, as amended by the Additional Terms. "SPPA Terms and Conditions Acceptance Agreement" means the agreement to the Single Pledged Accounts Terms and Conditions, in connection with this Agreement entered into by the Lender, Eurex Clearing AG and Euroclear on or about the date of this Agreement, as amended by the Additional Terms. 3

5 1.2 Construction In the event of a conflict between the provisions of this Agreement and those of the Clearing Conditions, the provisions of the Clearing Conditions shall prevail. In the event of a conflict between the provisions of this Agreement and those of the SPPA Terms and Conditions, the provisions of this Agreement shall prevail. In addition, unless a contrary indication appears (and without limiting the generality of the foregoing): (i) (ii) (iii) the terms "Party", "Eurex Clearing AG" and "Lender" include their respective successors ("ad universum") and the transferees or assignees (by way of novation or otherwise) of rights and obligations under this Agreement; a provision of law is a reference to that provision as amended or re-enacted; and Clause headings are for ease of reference only. 2 Pledge 2.1 In order to secure the Secured Liabilities with respect to a Relevant Lending Set, Eurex Clearing AG grants to the Lender a Pledge over the Pledged Assets with respect to such Relevant Lending Set, in accordance with the Financial Collateral Law. 2.2 The Pledge is a first ranking pledge (gage de premier rang/pand in eerste rang) and shall rank ahead of the right of preference of Euroclear as contemplated in Article 31 of the Financial Supervision Law. 2.3 On the Value Date of the Particular Securities Lending Transaction or any Securities Lending Transaction included in the Particular Exposure Netting Unit, the relevant Initial Principal Collateral (as defined and determined pursuant to Chapter IX Part 2 Number of the Clearing Conditions) shall be transferred into the Pledged Securities Account and designated by Euroclear for the Relevant Lending Set based on instructions given by Eurex Clearing AG to Euroclear. As a result of such transfer, the Pledge over the relevant Initial Principal Collateral in the form of securities will be perfected. 2.4 The Parties shall treat the Pledged Accounts for all purposes as special accounts specifically opened for the purpose of holding pledged assets. 3 Marking to market of Principal Collateral during the term of the Relevant Lending Set 3.1 Chapter IX Part 2 Number of the Clearing Conditions provides, with respect to each Relevant Lending Set, that Eurex Clearing AG will ensure that the value of all Non-Cash Principal Collateral will at all times be at least equal to the Required Collateral Value (as defined in Chapter IX Part 2 Number Paragraph (1) of the Clearing Conditions). 3.2 The delivery of additional Non-Cash Principal Collateral or the return of Pledged Assets will be operated by Euroclear based on instructions given by Eurex Clearing AG to Euroclear, whereby Eurex Clearing AG shall only issue instructions under this Section 3.2 to satisfy the requirements of Section 3.1 above. 3.3 The delivery of additional Non-Cash Principal Collateral or the return of Pledged Assets in accordance with Clause 3.2 will not affect the continuity of the Pledge. Any such return 4

6 shall not constitute a release of the Pledge (except in respect of the particular Pledged Assets returned) and all Pledged Assets which are from time to time standing to the credit of the Pledged Accounts shall remain subject to this Pledge. As from the delivery of additional Non-Cash Principal Collateral, all references to Non-Cash Principal Collateral in this Agreement will be deemed to include the new Non-Cash Principal Collateral and, as from the return of Pledged Assets, all references to Pledged Assets in this Agreement will be deemed to exclude the returned Pledged Assets. 4 Substitution 4.1 For each Relevant Lending Set, substitution will be operated by Euroclear using the AutoSelect Processing procedure. 4.2 Any substitution of Non-Cash Principal Collateral in accordance with this Clause 4 (Substitution) will not affect the continuity of the Pledge. The Parties acknowledge that the new Non-Cash Principal Collateral will be deemed to be pledged under the same conditions as the substituted Non-Cash Principal Collateral. As from the substitution in accordance with this Clause 4 (Substitution), all references to Non-Cash Principal Collateral in this Agreement will be deemed to include the new Non-Cash Principal Collateral and to exclude the substituted Non-Cash Principal Collateral. 4.3 Any substitution under this Clause 4 (Substitution) shall not constitute a release of the Pledge (except in respect of the particular securities substituted) and all Non-Cash Principal Collateral which is from time to time standing to the credit of the Pledged Securities Account shall remain subject to this Pledge. 4.4 Eurex Clearing AG and the Lender confirm and agree that the securities shall be treated by each of them and by Euroclear as fungible with all securities of the same issue deposited with Euroclear in accordance with the Royal Decree No Voting rights and distribution For each Relevant Lending Set, Corporate Events will be operated by Euroclear using the AutoSelect Processing procedure. 6 Representations and warranties Eurex Clearing AG makes the representations and warranties set out in this Clause 6 to the Lender. Eurex Clearing AG undertakes to the Lender that these representations and warranties shall at all times remain true and correct until full discharge of the Pledge in accordance with Clause 9 (Release of the pledge). 6.1 The Agreement This Agreement has been duly authorised, executed and delivered by Eurex Clearing AG and constitutes legal, valid and binding obligations of Eurex Clearing AG, enforceable in accordance with its terms, subject to any general principles of law limiting the obligations of Eurex Clearing AG. 5

7 6.2 Pledged Assets The Pledged Assets are subject to the provisions of any law or regulation relevant to the Pledged Assets, freely and fully transferable and capable of being pledged and not subject to any pre-emptive rights or restrictions on transfer. 6.3 Ownership Eurex Clearing AG is the legal owner of the Non-Cash Principal Collateral credited to the Pledged Securities Account under this Agreement, free and clear of any claims, options, security interest, liens, other rights of third parties and other encumbrances or other interest or restriction other than the Pledge created under this Agreement and any lien routinely imposed on all securities in a clearing system in which any such Non-Cash Principal Collateral may be held. 6.4 Corporate power Eurex Clearing AG has the power to grant the Pledge to the Lender. 7 Restrictions and undertakings 7.1 Disposal Eurex Clearing AG shall not (nor shall it agree to) sell, lease, transfer or otherwise dispose of any of the Pledged Assets, except as expressly permitted by this Agreement. 7.2 No adverse action Eurex Clearing AG shall not do or cause anything which may directly or indirectly adversely affect the effectiveness, ranking, validity or enforceability of the Pledge or the rights of the Lender. 7.3 Attachments Eurex Clearing AG shall procure that no executory attachment (uitvoerend beslag/saisie exécutoire) is made on any of the Pledged Assets and shall procure that any conservatory attachment (bewarend beslag/saisie conservatoire) on any of the Pledged Assets is released within thirty (30) days. 8 Enforcement 8.1 Without prejudice to Clause 8.2, at any time when an Enforcement Event has occurred the Lender may, subject to the procedures provided for in Section 4.11 of the Additional Terms, (by providing relevant instructions to Euroclear): (a) (b) (c) enforce the Pledge over the Pledged Assets pursuant to Article 8 1 of the Financial Collateral Law; appropriate the Pledged Assets pursuant to and in accordance with Article 8, 2 of the Financial Collateral Law, in which case the value of the Pledged Assets shall be their Market Value at the time of appropriation; apply the cash to the Secured Liabilities and any cash in a currency other than the base currency shall be converted in accordance with the conversion rules provided for in Chapter IX Part 2 Number of the Clearing Conditions (as amended from time to time); or 6

8 (d) exercise all rights and remedies it possesses, and may act generally in relation to the Pledged Assets in such manner as it shall reasonably determine. 8.2 In respect of a Particular Exposure Netting Unit, the Lender shall not enforce the Pledge over more Pledged Assets, or appropriate more Pledged Assets, or apply more cash, than are necessary in order to discharge the Secured Liabilities in respect of such Securities Lending Transactions which, in accordance with their terms, are due for performance at the time of such enforcement, appropriation or application. 9 Release of the Pledge 9.1 For each Relevant Lending Set, the Pledged Assets with respect to such Relevant Lending Set shall be released from the Pledge in accordance with and subject to Chapter IX Part 2 Number 2.3 and other relevant provisions of Chapter IX Part 2, of the Clearing Conditions. 9.2 Except under Clause 9.1 above (and in the other circumstances expressly set forth in this Agreement), Eurex Clearing AG is not authorised to give any instructions to Euroclear to deliver Pledged Assets to any account or person, whether or not outside the control of Euroclear or any other instructions having as a result that Pledged Assets would be transferred out of the Pledged Accounts. 10 Transferability 10.1 The benefit of the Pledge and of this Agreement shall be automatically transferred to any transferee or assignee (whether by way of novation or otherwise) of (part or all of) the Secured Liabilities In case of termination or amendment by Euroclear or Eurex Clearing AG of the SPPA Terms and Conditions, and/or the SLSA Terms and Conditions and/or the SLSA Operating Procedures, this Agreement shall be amended in order to reflect such termination or amendment as will be decided by Eurex Clearing AG in its sole discretion (acting reasonably and in good faith) and notified to the Lender. For the avoidance of doubt, such amendment may not impact the validity or enforceability of the Pledge or materially increase the cost or difficulty to the Lender of enforcing the Pledge. 11 Partial Invalidity If, at any time, any provision of this Agreement is or becomes illegal, invalid or unenforceable in any respect under any law of any jurisdiction, neither the legality, validity or enforceability of the remaining provisions nor the legality, validity or enforceability of such provision under the law of any other jurisdiction will in any way be affected or impaired. 12 Notices Each communication to be made under or in connection with this Agreement shall be made in accordance with the relevant provisions of the Clearing Agreement. 13 Governing Law This Agreement (and any non-contractual obligation arising out of or in connection with this Agreement) is governed by Belgian law. 7

9 14 Choice of Forum The courts of Brussels, Belgium have exclusive jurisdiction to settle any dispute arising out of or in connection with this Agreement (including a dispute relating to the existence, validity or termination of this Agreement or any non-contractual obligation arising out of or in connection with this Agreement) (a "Dispute"). Documentary duty of EUR 0.15 per original paid by bank transfer from Eurex Clearing AG./Recht op geschriften van 0,15 euro per origineel betaald per overschrijving door Eurex Clearing AG./Droit d écriture de 0,15 euro par original payé par transfert bancaire par Eurex Clearing AG. 8

10 AUTHORISED SIGNATURES to the Euroclear Pledge Agreement (as Lender CLEARING-MEMBER) (Place / Date) Name: Function: Name: Function: Eurex Clearing Aktiengesellschaft (EUREX CLEARING AG) (Place / Date) Name: Function: Name: Function: 9

11 Schedule 1 to Euroclear Pledge Agreement FORM OF NOTICE OF PLEDGE To: Euroclear Bank SA/NV To the attention of Boulevard du Roi Albert II 1210 Brussels Belgium Name of the Pledgee Company Name Address Street No Address 1 Zip Code Country City Re: Notice of pledge Dear Sirs, Date: We would like to inform you hereby that Eurex Clearing AG (the "Pledgor") has pledged in favour of (the "Pledgee") Pledged Assets standing or that will be standing to the credit of the Pledged Securities Account (and associated Pledged Cash Account) numbered and opened in the name of the Pledgor in your books in accordance with a Euroclear pledge agreement dated between the Pledgor and the Pledgee (the" Euroclear Pledge Agreement"). For your information we attach a copy of the Euroclear Pledge Agreement. In addition to this Euroclear Pledge Agreement, Eurex Clearing AG and the Pledgee are entering, with your institution, into the SLSA Terms and Conditions, the SLSA Operating Procedures, the SPPA Terms and Conditions and the SPPA Terms and Conditions Acceptance Agreement (as amended by the Additional Terms), in relation to the Pledged Assets provided under this Euroclear Pledge Agreement. For the management of the Pledged Assets, the SLSA Terms and Conditions and the SLSA Operation Procedures (as amended by the Additional Terms) shall apply. Upon the occurrence of an Enforcement Event which is continuing, the Pledgee will be entitled to enforce the Pledge pursuant to Clause 8 of the Euroclear Pledge Agreement. 10

12 Terms not defined in this notice shall have the meaning ascribed to them in the Euroclear Pledge Agreement. This notice is without prejudice to the SLSA Terms and Conditions, the SLSA Operating Procedures, the SPPA Terms and Conditions and the SPPA Terms and Conditions Acceptance Agreement (as amended by the Additional Terms). Kind regards, Eurex Clearing AG Frankfurt am Main, Date Signature Signature Pledgee Place Date Signature Signature 11

13 Schedule 2 to Euroclear Pledge Agreement NOTICE TO BE GIVEN TO EUROCLEAR BANK SA/NV IN CASE OF AN ENFORCEMENT EVENT To: cc: Euroclear Bank SA/NV To the attention of Boulevard du Roi Albert II 1210 Brussels Belgium Eurex Clearing AG Frankfurt/Main Deutschland Name of the Pledgee Company Name Address Street No Address 1 Zip Code Country City Dear Sirs, Date: Notice of an Enforcement Event We refer to the Pledged Securities Account (and associated Pledged Cash Account) bearing number opened in the name of Eurex Clearing AG (the "Pledgor") with your institution. We hereby give you notice, for the purpose of Clause 8 of the Euroclear Pledge Agreement dated between the Pledgor and our institution as Pledgee, that an Enforcement Event (as defined in the Euroclear Pledge Agreement) [due to an Insolvency Event with respect to Eurex Clearing AG] [Please include, if appropriate] has occurred. [We have attached a copy from [ similar] to this notice as evidence for the filing by the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht) of a petition for the opening of insolvency proceedings over the assets of Eurex Clearing AG] [Please include, if Enforcement Event is triggered due to an Insolvency Event with respect to Eurex Clearing AG]. [Instructions in relation to the appropriation or sale of the Pledged Assets and to the payment of any cash proceeds to be added as decided by the Pledgee]. 12

14 Yours sincerely, Pledgee Place Date Signature Signature 13