5. Obligations of the Client
(a) The Client acknowledges and agrees that:
(i) All transactions in the Accounts shall comply with the Criteria;
(ii) If any transaction occurs in the Accounts that does not comply with the Criteria, the Client will be deemed to be in default under the Security
Agreement, and the Secured Party will be entitled to exercise all of their rights under the Security Agreement and this Agreement;
(iii) The Criteria may be changed only with the written consent of the Secured Party;
(iv) To the extent that any conflict or potential conflict exists or may exist between the terms of this Agreement and the terms of any other
agreement(s) the Client has entered into with the Company, the terms of this Agreement will prevail; and
(v) The Client will not enter into any other agreement or arrangement, which is to similar effect as this Agreement, with any other firm, person or
(vi) The Client agrees that all certificated or uncertificated securities or instruments or any other financial asset credited to the Account will be
registered or recorded in the name of or payable to the order of the Company or the Secured Party only or endorsed to the Company, the
Secured Party or in blank and in no case will any security or instrument credited to the Account be registered or recorded in the name of the
Client, payable to the order of the Client or specially endorsed to the Client.
6. Agreements of Client and Company
(a) The Client and the Company agree with each other and the Secured Party that each item of Account Property is a “financial asset” as defined in
the Securities Transfer Act (Ontario) or similar legislation in any other relevant jurisdiction.
(b) The Client and the Company agree that, regardless of any provision in any other agreement relating to the Accounts, the Company’s jurisdiction is
Ontario for purposes of the Securities Transfer Act (Ontario) or similar legislation in any other relevant jurisdiction.
(c) The Company will not be liable to the Client for complying with a Notice of Exclusive Control.
7. Rights of Secured Party
(a) Except as otherwise provided in the Agreement and until such time as the Company receives a notice in writing stating that the Secured Party is
exercising a right of exclusive control over the Accounts (“Notice of Exclusive Control”), the Company will continue to act in accordance with orders
originated by the Client.
(b) In the event that the Secured Party gives a Notice of Exclusive Control to the Company, the Company will after receiving the Notice of Exclusive
Control act only on an order or instruction directing transfer or redemption or other activity (an “Entitlement Order”) it receives from the Secured
Party in connection with the Account and the Account Property, notwithstanding the provisions of any agreement it may have with the Client. The
Company will not act on an Entitlement Order relating to the Accounts or the Account Property given by any other person, including the Client.
(c) The Client, by execution of this Agreement, irrevocably consents to the Company acting on Entitlement Orders of the Secured Party even if they
are in conflict with the rights afforded to the Client (e.g. termination) under any other agreement(s) the Client has entered into with the Company.
The Company will have no obligation or right to (i) determine whether or not an event of default exists under the Security Agreement or any other
agreement between the Secured Party and the Client, or (ii) investigate the circumstances under which the Secured Party are entitled to give
any Entitlement Orders or Notice of Exclusive Control. If an Entitlement Order given by the Client conflicts with an Entitlement Order given by the
Secured Party the Company will comply with the Entitlement Order given by the Secured Party.
(d) The Secured Party may revoke any Notice of Exclusive Control by delivering a written notice to the Company that they have ceased to require
exclusive control over the Accounts and the Account Property (a “Notice of Cessation of Control”) pursuant to the Notice of Exclusive Control. Upon
the Company receiving a Notice of Cessation of Control, the Client will have those rights with respect to the Accounts and the Account Property
as it had prior to the delivery of the relevant Notice of Exclusive Control and, after it has had a reasonable opportunity to comply, and until such
time as it receives another Notice of Exclusive Control, the Company will act on instructions from the Client with respect to the Accounts and the
Account Property as though it had not received a Notice of Exclusive Control.
(e) The Company will be entitled to rely upon any Entitlement Order, Notice of Exclusive Control or Notice of Cessation of Control that it reasonably
believes to be from the Secured Party.
8. Termination of Agreement
(a) This Agreement may be terminated at any time by the Secured Party or the Company on thirty days’ notice in writing to the other parties to this
Agreement. In the event of termination by the Company, the Company will not transfer any Account Property without the written agreement of the
Secured Party but may continue to hold the Accounts and any Account Property pursuant to the terms of this Agreement. Notwithstanding any
termination rights afforded to the Client in any other agreement with the Company, the Client may terminate this Agreement only with the written
agreement of the Secured Party, in which case the Company may deal with the Accounts and the Account Property as directed by the Client.
(b) The Client acknowledges that until the Secured Party consent in writing to the termination of this Agreement upon the Client’s request, the
Company will continue to hold the Accounts and the Account Property pursuant to the terms of this Agreement.
9. Limit on the Company’s Obligations
(a) The Secured Party acknowledges that:
(i) the Company is not a guarantor of the Client;
(ii) the Company is only bound to cause the Account Property to be held in the Accounts, and to hold the Accounts and the Account Property
pursuant to the terms of its Agreement with the Client and its obligations under this Agreement, and to otherwise comply with its obligations
under this Agreement and its agreement with the Client;
(iii) the Company does not make any guarantee, representation or warranty about the value of or the performance of any Account Property;
(iv) the value of the Account Property may decrease;
(v) the Company has no responsibility to determine whether any transaction in the Account complies with the Criteria; and,
(vi) subject as provided herein, the Company may be obliged to comply with claims made by third parties.
(a) The Client agrees to pay all fees, costs and outlays claimed or incurred by the Company and the Secured Party with respect of this Agreement and
the arrangements created by it.
(a) The Secured Party agrees to indemnify and hold harmless the Company from any loss, cost, damage or expense which it may suffer or incur as a
result of complying with any instructions or directions given to it by the Secured Party under the terms of this Agreement.
12. Addresses of Parties
(a) Statements and notices required or permitted to be given hereunder shall be delivered by personal delivery or by first class prepaid mail to the
Client at the Client’s address then current in the records of the Secured Party, and to the other parties at the following addresses:
For the Secured Party:
199 Bay Street, Suite 600
PO Box 279 STN Commerce Court
Toronto, Ontario M5L 0A2
Attention: Vice-President, Operations
For (any) of the Company:
B2B Bank Dealer Services
199 Bay Street, Suite 610
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