5320. Installment receipts

Or jump to a Series:

    1. A Dealer Member must calculate Dealer Member inventory margin and client account margin for installment receipt long positions according to the following:

      Account where position is held

      Minimum margin required

      Held in Dealer Member inventory account

      100% of margin required for underlying security plus any excess of the future installment payments over the market value of the underlying security

      Held in client account

      The lesser of 100% of margin required for underlying security and the market value of the installment receipt

    2. A Dealer Member may purchase and hold an installment receipt for its own account as beneficial owner.

    3. A Dealer Member may hold an installment receipt for a client registered in the Dealer Member’s or its nominee name.

    4. A Dealer Member must not purchase or hold an installment receipt that requires it or its nominee to make payment under the installment receipt.

    5. Subsection 5320(4) does not apply:

      1. to a Dealer Member’s payments for its own account as beneficial owner of the installment receipt, or

      2. if the agreement creating and issuing the installment receipts releases the Dealer Member or its nominee from the requirement to make the payments in subsection 5320(4) either by:

        1. transferring the installment receipt to another person if an installment is not paid in full when due, or

        2. another mechanism approved by IIROC.

      3. The transfer in sub-clause 5320(5)(ii)(a) must be able to occur at any time before:

        1. the close of business (Toronto time) on the second business day after default in payment of an installment, and

        2. the issuer’s or selling security holder’s rights arising from non-payment of the installment can be enforced.

    6. If an installment on an installment receipt held for a client in subsection 5320(4) has not been paid in full when due, the Dealer Member must promptly take steps necessary to be released from any requirements to pay the installment or any future payments. The Dealer Member must take steps within the time permitted by the agreement creating and issuing the installment receipts. If appropriate or necessary, the Dealer Member must transfer the installment receipt to another person.

    5321. - 5329.  Reserved.

    There is no history log for this rule.

    There is no history log for this rule.