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The Margin Agreement serves as the foundational document for margin trading relationships in the Philippine securities market. This agreement is essential when clients wish to trade securities using borrowed funds from their broker-dealer, allowing them to leverage their investment positions. The document must comply with Philippine regulatory requirements, particularly those set forth by the Securities and Exchange Commission and the Bangko Sentral ng Pilipinas. The Margin Agreement includes crucial provisions regarding margin maintenance requirements, collateral arrangements, risk disclosures, and default procedures, while also incorporating specific local market practices and regulatory safeguards. It is typically used by broker-dealers, investment houses, and financial institutions offering margin trading services to both retail and institutional clients in the Philippines.

1. Parties: Identification of the broker-dealer and the client

2. Background: Context of the agreement and purpose of the margin facility

3. Definitions: Definitions of key terms including margin, collateral, margin call, maintenance margin, etc.

4. Margin Facility Terms: Core terms of the margin facility including credit limits and margin ratios

5. Margin Requirements: Initial and maintenance margin requirements, calculation methods

6. Collateral Arrangements: Provisions regarding acceptable collateral, valuation, and custody

7. Margin Calls and Maintenance: Procedures for margin calls, timing, and consequences of non-compliance

8. Interest and Fees: Interest calculations, rates, fees, and charges applicable to the margin facility

9. Rights and Obligations: Detailed responsibilities of both parties

10. Default Events: Definition of events of default and consequences

11. Liquidation Rights: Broker's rights to liquidate positions in default scenarios

12. Risk Disclosure: Mandatory risk warnings and disclosures

13. Representations and Warranties: Standard declarations by both parties

14. Term and Termination: Duration of agreement and termination provisions

15. Governing Law and Jurisdiction: Application of Philippine law and jurisdiction