Subordinated Loan Agreements ("SLA")

CFTC Regulation 1.17 defines assets and liabilities that effect a firm's net capital position. When computing net capital, an FCM or IB may exclude a liability that is subordinated to the claims of all general creditors pursuant to a satisfactory subordination agreement. A subordinated loan agreement must be filed with NFA at least ten days prior to the proposed effective date of the agreement and cannot be considered "satisfactory" until NFA finds the agreement acceptable. In order to facilitate the approval process for subordinated loan agreements ("SLA"), NFA recommends that the FCM or IB use the following templates as a guide when drafting an SLA:

• Sample cash SLA
• Sample Revolving SLA
• Sample Secured Demand Note SLA
• Sample Revolving SLA (Equity)