8.5.1

Past version: Effective up to 21 Apr 2013

The obligation of the selling customer to make delivery of securities to CDP pursuant to a New Sale Contract shall be discharged by CDP debiting such securities from the "Free" balance of the Securities Account or sub-account of the selling customer and crediting CDP's suspense account before 12 midnight on the Settlement Day. Title and right to such securities shall not at any time pass to the Defaulting Clearing Member. In the event that there are insufficient or no securities in the "Free" Balance of such Securities Account or sub-account, the selling customer shall be responsible to CDP for such shortfall.

In addition, the selling customer shall ensure that the securities are available in the balance of his Securities Account or sub-account by 12.00 noon on Settlement Day, or such time as determined by CDP.

Where the selling customer who:

(1) has not made available in the balance of his Securities Account or sub-account the securities or sufficient securities by 12.00 noon on Settlement Day or such time as determined by CDP; or
(2) has failed to deliver the securities or sufficient securities at any time after the Settlement Day,

such securities will be acquired in the manner prescribed by CDP.

The securities acquired shall thereafter be debited from the selling customer's Securities Account or sub-account. Notwithstanding that the Clearing Fund may have been drawn upon, CDP may at any time thereafter claim the difference and all losses and expenses consequent upon such acquiring of securities, and all damages which CDP may sustain in this connection (regardless of whether such losses, expenses and damages have been insured against) shall be recoverable by CDP from:—

(1) the selling customer and, failing him;
(2) the Defaulting Clearing Member.

Amended on 3 April 20083 April 2008 and 20 November 200920 November 2009.