Security Lending Agreement Template for Denmark

The Security Lending Agreement is a crucial document used in the Danish financial markets to facilitate the temporary transfer of securities from one party (lender) to another (borrower) in exchange for collateral. This agreement is essential for market participants operating under Danish jurisdiction who engage in securities lending activities, whether for coverage of short positions, generation of additional revenue, or enhanced portfolio management. The document must comply with Danish financial regulations, including the Danish Capital Markets Act and relevant EU regulations such as SFTR. It contains detailed provisions on operational procedures, risk management, default handling, and regulatory reporting requirements specific to the Danish market context. The agreement is particularly important given Denmark's position in the Nordic financial markets and its relationship with EU financial regulations while maintaining its own distinct legal framework.

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

2. Background: Context of the agreement and brief description of the parties' intentions regarding securities lending

3. Definitions and Interpretation: Comprehensive list of defined terms used throughout the agreement and rules of interpretation

4. Loans of Securities: Core provisions governing the lending of securities, including initiation process and confirmation requirements

5. Delivery of Securities: Procedures and requirements for the delivery of securities between parties

6. Collateral Requirements: Details of required collateral, including type, quality, and maintenance of margin requirements

7. Mark to Market: Procedures for daily valuation of loaned securities and collateral, including timing and methodology

8. Income and Corporate Actions: Treatment of dividends, interest, and other corporate actions affecting loaned securities

9. Fees and Charges: Lending fees, rebate rates, and other applicable charges

10. Tax: Treatment of tax implications, withholding requirements, and tax-related representations

11. Representations and Warranties: Standard and specific representations and warranties from both parties

12. Events of Default: Definition of events of default and their consequences

13. Termination: Provisions for termination of individual loans and the agreement as a whole

14. Set-off Rights: Rights of set-off and netting arrangements

15. Governing Law and Jurisdiction: Confirmation of Danish law as governing law and jurisdiction for disputes