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The Wholesale Broker Agreement is a crucial document used when establishing a formal relationship between a wholesale broker (typically a larger financial institution) and an introducing broker in the Canadian securities market. This agreement is essential when an introducing broker wishes to leverage the infrastructure, clearing capabilities, and services of a wholesale broker while maintaining their own client relationships. The document comprehensively covers regulatory requirements under Canadian securities laws, IIROC rules, and provincial regulations, detailing everything from operational procedures to compliance obligations. The agreement is particularly important in ensuring clear delineation of responsibilities, risk management procedures, and service levels while maintaining compliance with Canadian regulatory requirements. It typically includes detailed provisions for trading services, clearing arrangements, technology access, reporting requirements, and financial terms.

1. Parties: Identification of the wholesale broker and the introducing broker, including full legal names and addresses

2. Background: Context of the agreement, including the purpose of the wholesale brokerage relationship and relevant regulatory authorizations

3. Definitions: Detailed definitions of terms used throughout the agreement, including regulatory and industry-specific terminology

4. Scope of Services: Detailed description of the wholesale brokerage services to be provided

5. Regulatory Compliance: Obligations of both parties to comply with relevant securities regulations and IIROC requirements

6. Registration and Licensing: Requirements for maintaining necessary registrations and licenses

7. Client Accounts: Procedures for account opening, maintenance, and documentation

8. Trading and Settlement: Processes for trade execution, clearing, and settlement

9. Fees and Compensation: Structure of fees, commissions, and payment terms

10. Compliance and Supervision: Supervision responsibilities and compliance monitoring procedures

11. Books and Records: Requirements for maintaining records and documentation

12. Confidentiality: Provisions for protecting confidential information and client data

13. Risk Management: Procedures for managing trading and operational risks

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

15. Indemnification: Mutual indemnification provisions and liability allocation

16. Term and Termination: Duration of agreement and termination provisions

17. General Provisions: Standard legal provisions including governing law, notices, and amendments