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Stock Management Agreement for Australia

Stock Management Agreement Template for Australia

A comprehensive legal agreement governed by Australian law that establishes the terms and conditions under which a professional stock management service provider will manage and administer a company's stock/share registry, including maintaining shareholder records, processing transfers, managing corporate actions, and ensuring compliance with relevant Australian regulations including the Corporations Act 2001 and ASX requirements where applicable. The agreement details the responsibilities, procedures, reporting requirements, and service standards for effective stock management while protecting both parties' interests.

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What is a Stock Management Agreement?

The Stock Management Agreement is a crucial document for companies seeking to outsource or formalize their stock management operations within the Australian legal framework. This agreement becomes necessary when a company requires professional assistance in managing its share registry, processing stock transfers, handling corporate actions, and maintaining accurate shareholder records. The document is particularly relevant for both listed and unlisted companies in Australia that need to ensure compliance with the Corporations Act 2001, ASX requirements (if applicable), and other relevant regulations. The agreement typically includes detailed provisions for service levels, fees, reporting requirements, confidentiality, and risk allocation between the company and the stock manager. It's especially important for companies experiencing growth, planning to list, or seeking to improve their corporate governance structures.

What sections should be included in a Stock Management Agreement?

1. Parties: Identifies and defines the parties to the agreement, typically including the company, stock manager, and any other relevant parties

2. Background: Sets out the context and purpose of the agreement, including the company's desire to engage the stock manager

3. Definitions and Interpretation: Defines key terms used throughout the agreement and establishes rules of interpretation

4. Appointment and Authority: Details the formal appointment of the stock manager and scope of their authority

5. Term and Termination: Specifies the duration of the agreement and circumstances for termination

6. Stock Manager's Obligations: Comprehensive list of duties and responsibilities of the stock manager

7. Company's Obligations: Outlines the company's responsibilities and commitments

8. Stock Management Procedures: Details the procedures for managing, issuing, transferring, and canceling stock

9. Fees and Expenses: Specifies the compensation structure and reimbursable expenses

10. Reporting Requirements: Defines the regular reports and information to be provided to the company

11. Confidentiality: Provisions protecting confidential information

12. Liability and Indemnification: Outlines the limits of liability and indemnification obligations

13. General Provisions: Standard legal provisions including notices, governing law, and dispute resolution

What sections are optional to include in a Stock Management Agreement?

1. Electronic Trading Platform: Include when the stock management involves use of specific trading platforms or software

2. International Transfers: Required when the agreement covers cross-border stock transactions

3. Employee Stock Options: Include when the agreement covers management of employee stock option plans

4. Dividend Processing: Add when the stock manager will handle dividend distributions

5. Custodial Services: Include when physical stock certificates need to be held in custody

6. Corporate Actions: Add when the stock manager will handle corporate actions like splits, consolidations, or rights issues

7. Audit Rights: Include when specific audit provisions beyond standard reporting are required

8. Business Continuity: Add when specific disaster recovery and business continuity requirements are needed

What schedules should be included in a Stock Management Agreement?

1. Schedule 1 - Fee Schedule: Detailed breakdown of all fees, charges, and payment terms

2. Schedule 2 - Service Level Agreement: Specific performance metrics and service standards

3. Schedule 3 - Authorized Representatives: List of authorized personnel who can give instructions

4. Schedule 4 - Report Ƶ: Ƶ for required regular reports and notifications

5. Schedule 5 - Stock Transfer Procedures: Detailed procedures for processing stock transfers

6. Schedule 6 - Security Protocols: Security requirements and procedures for protecting data and assets

7. Appendix A - Required Forms: Standard forms used in stock management operations

8. Appendix B - System Specifications: Technical requirements for any electronic systems used

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

Australia

Publisher

Ƶ

Sector

Cost

Free to use

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