SECURITY DELIVERIES, LOANS, AND TRANSFERS 371
The New Loan Agreement.—The borrower first makes
out in his office a new loan agreement, which in several respects
resembles the return loan agreement already described. The
new loan agreement form (Figure 40) is in quadruplicate and
contains the borrower’s clearing number at its head, as well
as a formal agreement stating that the lender has agreed to
loan to the borrower in accordance with and subject to the
By-laws and Rules of the Stock Clearing Corporation a stated
sum of money at a stated interest rate, upon the collateral of
an appended itemized list of securities. This itemized list states
the name, number, price, and value of the securities to be
pledged for the loan. After filling out the four forms of this
new loan agreement, the borrower signs them at the bottom,
and his representative takes the agreement to the office of the
lender
Here, the lender passes on the desirability of the security
collateral itemized on the face of the agreement. If the col-
lateral is acceptable to him, he detaches two of the four forms
of the agreement for his own use, and, after signing the other
two forms in the space provided for that purpose at the bottom,
returns these to the borrower’s representative. But in case the
collateral for the proposed loan is not acceptable to the lender,
the latter rejects the agreement and requests the borrower to
pledge other securities than those on the list as collateral. In
such cases the borrower proceeds to make up a new list of
securities and a new agreement which will be acceptable to the
lender, and sends it back to the latter for his approval and
signature in the manner above described. These new loan
agreements for new loans to be “put through” the Stock Clear-
ing Corporation are accepted by lenders up to 2:45 P.M. In
case a borrower sends his agreement to the lender after that
time, the lender can insist that the loan be made “ex,” in which
case, of course, the Stock Clearing Corporation does not figure
further in the matter
