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Equity Linked Agreement Template for Hong Kong

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Key Requirements PROMPT example:

Equity Linked Agreement

"I need an Equity Linked Agreement for a structured product linked to Hong Kong-listed tech stocks, to be issued by our investment bank to professional investors, with knock-out features and physical settlement options."

Document background
The Equity Linked Agreement serves as the primary contractual framework for structured equity investment products in Hong Kong's financial markets. It is typically used when financial institutions offer equity-linked notes, certificates, or similar structured products to professional and institutional investors. The document must comply with Hong Kong's Securities and Futures Ordinance, the Code on Unlisted Structured Investment Products, and other relevant regulations. It includes detailed provisions on product mechanics, market disruption events, early termination rights, and mandatory risk disclosures. The agreement is essential for financial institutions operating in Hong Kong's structured products market and requires careful consideration of both regulatory requirements and commercial terms.
Suggested Sections

1. Parties: Identification of the issuer/dealer and the investor, including registration details and addresses

2. Background: Context of the agreement and brief description of the equity-linked product being offered

3. Definitions and Interpretation: Definitions of technical terms, market events, calculation methods, and interpretation rules

4. Investment Terms: Core terms including notional amount, underlying securities, strike price, and investment period

5. Subscription and Settlement: Process for subscribing to the product and settlement mechanics

6. Calculations and Valuations: Details of how calculations are made, including pricing, adjustments, and market disruption provisions

7. Payments: Payment obligations, currency provisions, and payment mechanics

8. Market Disruption Events: Provisions dealing with market disruptions and their consequences

9. Representations and Warranties: Standard representations and warranties from both parties

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

11. Termination: Provisions for early termination and its consequences

12. Notices: Communication requirements and methods between parties

13. Governing Law and Jurisdiction: Hong Kong law as governing law and jurisdiction provisions

Optional Sections

1. Additional Product Features: Used when the product includes special features like knock-in/knock-out provisions or autocallable features

2. Hedging Provisions: Include when the issuer needs specific hedging rights and protections

3. Tax Provisions: Detailed tax provisions when product has specific tax implications or cross-border elements

4. Transfer Restrictions: Include when transfer of the product needs to be restricted

5. Additional Risk Disclosures: Used for products with unique or complex risk profiles requiring specific disclosures

6. Force Majeure: Extended force majeure provisions for complex products or volatile markets

7. Intermediary Provisions: Include when the product is sold through intermediaries

8. Custody Arrangements: Used when specific custody arrangements are required for the underlying securities

Suggested Schedules

1. Schedule 1 - Product Terms: Detailed terms of the specific equity-linked product including all economic terms

2. Schedule 2 - Calculation Methods: Detailed calculation methodologies for all relevant pricing and adjustment calculations

3. Schedule 3 - Form of Notice: Standard forms for various notices required under the agreement

4. Schedule 4 - Risk Disclosure Statement: Detailed risk disclosures required by Hong Kong regulations

5. Schedule 5 - Subscription Form: Form for investor subscription to the product

6. Schedule 6 - Term Sheet: Summary of key commercial terms and features

7. Appendix A - KYC Requirements: Required know-your-client documentation and forms

8. Appendix B - Professional Investor Declaration: Forms and requirements for professional investor status verification

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok³ÉÈ˰æ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions


















































Clauses








































Relevant Industries

Financial Services

Investment Banking

Wealth Management

Asset Management

Securities Trading

Professional Services

Legal Services

Banking

Corporate Finance

Relevant Teams

Legal

Compliance

Risk Management

Structured Products

Trading

Operations

Sales

Investment Advisory

Documentation

Settlement

Product Development

Financial Engineering

Client Relations

Middle Office

Relevant Roles

Chief Investment Officer

Head of Structured Products

Legal Counsel

Compliance Officer

Risk Manager

Product Manager

Investment Advisor

Trading Manager

Operations Manager

Portfolio Manager

Relationship Manager

Documentation Specialist

Financial Engineer

Sales Director

Settlement Officer

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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