SUBORDINATED LOANS USER GUIDE
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Below is a List of the Required Documents to be submitted into the Firm Gateway for a New Loan, Amendment,
Pre-payment, or Drawdown.
New Loan
- Lender’s Attestation – this document can be found on the Firm Gateway once you click on Subordinated Loans
on the right hand side under the heading ‘Related Links. Complete form for lender’s review & signature;
- Investor’s Disclosure Document - This form is Attachment A of Notice to Members 02-32. Please file the entire
Notice to Members with the executed Attachment A. Must be signed by proposed lender:
http://www.finra.org/Industry/Regulation/Notices/2002/P003647
or also available under ‘Related Links’ once
you are in the Firm Gateway and have clicked on Subordinated Loans;
- Resolution from the Lender (unless the lender is a Bank or Individual) that the loan is authorized and the person
signing the agreement is empowered to do so and directed to execute the agreement on behalf of the
organization. If a Bank, only the authorization of signature is required;
- Corporate Minutes from the Broker/Dealer that the loan is authorized and the person signing the agreement is
empowered to do so and directed to execute the agreement on behalf of the organization;
- Source of Funding – broker/dealer will need to submit the source of the funding (e.g. bank statements, account
records);
- Proof of Funding – on the effective date of the loan, the firm will need to submit proof of the funding of the loan
(e.g. copies of checks, wire confirmations, bank statements, deposit receipts, or otherwise);
- Proforma Net Capital Computation for the proposed subordination, including a calculation of the firm’s debt-
equity ratio, in accordance with Paragraph (d) of SEA 15c3-1;
- Name of the Broker/Dealer’s Bank and the last 4 digits of the account number the funding will be
wired/transferred into.
If a Secured Demand Note, in addition to the above:
- Proof of Ownership - Copies of supporting records or bank and/or clearing firm statements to reflect the
ownership of the SDN collateral;
- Collateral in Street Name - Evidence that the collateral has been transferred to the account of the
broker/dealer;
- Collateral Pricing - Pricing information to support market value of the SDN collateral and the firm’s computation
to determine collateral value, as defined in SEA Rule 15c3.1, Appendix D(a)(iii);
- Collateral Account – Collateral will be deposited into the broker/dealer SDN account for benefit of the Lender.
If a Temporary Loan, in addition to the above:
- Open Contractual Commitment Charge calculation based on the number of shares underwritten;
- Firm Commitment - Confirmation the underwriting is a Firm Commitment Offering with no right of return;
- Prospectus/Red Herring – Provide a copy of the prospectus/red herring;
- Invitation Wire – If available.
NOTE: The system generates the loan agreement for you once you click on the Submit button. This is the agreement
that is required to be executed and uploaded once the loan is in ‘Draft Documents Received’ status. To access the
agreement, click on the paper clip icon in the Actions column of the filing cabinet.