WMC-13 (O) (9-2010)
(e)
Master Conditions (Securities, Deposit
Products, Options and Investment Funds)
CMB WING LUNG BANK LIMITED of
You agree that:
(a) Part 1 of these
Master Conditions applies to all cash accounts ("Securities Accounts")
(if any) with us for the trading of and investments in bonds, notes, debentures
and other securities other than unit trusts, mutual funds and collective
investment schemes ("securities") on your
behalf.
(b) Part 2 applies to all
accounts for the custody of securities ("Custody Accounts") (if any) in your
name with us. (If applicable) The signing arrangements of the Settlement
Account referred to in paragraph (d)
below will apply to your Custody
Accounts.
(c) Part 3, together with the relevant Confirmation,
governs each equity-linked deposit, currency-linked deposit, share option or
currency option made with us which is expressed to be subject to these
Conditions. In the event of
inconsistency between the terms of a Confirmation and the provisions of these
Conditions, the terms of the Confirmation shall prevail;
and
(d) Part 4 applies to the
services provided by us for your investments in unit trusts, mutual funds and
collective investment schemes. For
the purpose of Condition 1.3 of Part 4, you specify your account(s)
maintained with us selected in Step 1 of the online wealth management account
opening procedures as your Settlement
Account.
(e) Part 5 applies to
all transactions subject to these Conditions. Part 5 is subject to Parts 1 to
4.
Part 6 contains certain risk disclosure
statements. Please read these Conditions carefully, particularly
Condition 4 (Limit of liability, indemnity and interest) of Part 5, and the risk
disclosure statements.
PART 1 -
SECURITIES
1.
SECURITIES ACCOUNT
1.1
You confirm that the information provided to us for the purpose of
opening the Securities Account is complete and accurate. You shall promptly inform us of any
material changes to that information.
We are authorised to conduct credit and other enquiries to verify the
information provided.
1.2
We shall inform you of any material changes to our name, address,
registration status, CE number, the nature of the services to be provided by us
under these Conditions, or to our commissions, fees or
charges.
1.3
If you are not the ultimate beneficiary or the person ultimately
responsible for originating an instruction in relation to securities listed on
the
(a) you
agree to provide full details (including the identity, address and contact
details) of the ultimate beneficiary and of the person ultimately responsible
for originating the relevant instructions directly to the Hong Kong stock
exchange and the Securities and Futures Commission ("SFC") within 2
business days of a request by the Hong Kong stock exchange or the
SFC;
(b) your
agreement in paragraph (a) above to provide information will survive termination
of these Conditions; and
(c) if a
beneficiary or a person originating an instruction is located in a foreign
country or place, you confirm that these provisions are binding under the
relevant foreign law.
2.
LAWS AND RULES
All transactions in securities effected on your behalf will be subject to
all laws, rules and regulatory directions applying to us, including the rules,
codes and guidelines of the Hong Kong Monetary Authority, the SFC, the relevant
exchanges and clearing houses. We
may do or refrain from doing anything in order to comply with such laws, rules
and directions. All such actions and omissions bind you.
3.
TRANSACTIONS
3.1
We will act as your agent in effecting transactions in securities unless
we indicate that we are acting as principal.
3.2
You confirm, unless you notify us otherwise in relation to any
transaction, that all your sell orders in respect of securities at or through
the
3.3
On all transactions in securities, you will pay our commissions, fees and
charges, in the amounts and within the times as notified to you, as well as fees
of the relevant exchange, clearing house and registrar, levies of any regulatory
authority, all applicable stamp duties and expenses. We may deduct such commissions, fees,
charges, levies, duties and expenses from the Securities Account or your other
accounts with us.
3.4
Unless otherwise agreed, in respect of each transaction in securities,
unless we are already holding cash or securities on your behalf to settle the
transaction, you will:
(a) pay
us cleared funds or deliver to us securities in deliverable form;
or
(b)
otherwise ensure that we have received such funds or
securities,
by such time as we have notified you in
relation to that transaction. If
you fail to do so, we may:
(i)
in the case of a purchase transaction, sell the purchased securities;
and
(ii) in
the case of a sale transaction, borrow and/or purchase securities in order to
settle the transaction.
3.5
We may instruct brokers and other agents on your behalf relating to the
purchase and sale of securities.
The terms of business of such brokers and agents will apply to your
transactions in securities.
3.6
If an order in relation to securities cannot be executed or be wholly
executed, we are under no obligation to notify you immediately. An instruction to buy or sell securities
may be partially executed if the instruction cannot be fully executed. An order to sell or purchase securities
will, to the extent not executed, lapse at the close of trading hours on the
business day on which the order was given.
3.7
You agree that we may accept from any brokers and dealers engaged in your
transactions any rebate or reallowance or soft commission as may be authorised
from time to time by any regulatory authority or the rules of any applicable
exchanges or clearing houses.
3.8
Whenever we purchase or sell securities on your behalf, you will be bound
by all our applicable current rules and regulations governing or affecting such
contract.
4.
SAFEKEEPING OF SECURITIES
4.1
All securities in the Securities Account are subject to a general lien
for the discharge of all your liabilities to us. If you do not perform any of
your obligations, we may sell your securities or part thereof (whether held by
us for safe custody or otherwise) at such price, on such terms and by such
method as we may determine. We may
apply the net proceeds to reduce all or any of your liabilities to us on any
account.
4.2
If we are holding your Hong Kong listed securities in safe custody in
Hong Kong, we will arrange for them to be registered or held in safe custody in
accordance with
4.3
Where securities are not registered in your name, any payments arising in
respect of such securities will, when received by us, be credited to the
Securities Account or paid to you, as agreed with you. Where the securities form part of a
larger holding of identical securities held for our clients, you will be
entitled to the same share of the payments arising on the holding as your share
of the total holding.
5.
STATEMENTS OF ACCOUNT
5.1
We will provide you with monthly statements of your securities and other
investment accounts, unless a statement is not required under applicable
regulation. Please notify us if you do not receive a
statement.
5.2
You will examine each statement of account carefully. If you do not object to a statement
within 90 days, you will be regarded to have accepted all matters recorded in
that statement. You will not however be liable for unauthorised transactions
arising from forgery or fraud (a) by any third party in relation to which we
have failed to exercise reasonable care and skill, or (b) by our employee or
agent, or other unauthorised transactions arising from our default or
negligence.
6.
MATERIAL INTEREST
When effecting transactions for you, we or
our associates may have a material interest in relation to the transaction or
securities concerned. In
particular, we or our associates may:
(a)
effect transactions with you as principal;
(b) effect
transactions where we or an associate has a position in the securities or is
involved as underwriter, sponsor or otherwise; or
(c) match
your order with those of other customers.
If we have an actual or potential conflict of
interest in relation to a transaction, we will not advise or deal in relation to
the transaction unless we have disclosed that conflict to you and have taken all
reasonable steps to treat you fairly.
7.
EQUITY-LINKED PRODUCTS
Condition 7 applies to equity-linked
products, however called, issued by other parties and distributed by us. Such
products include ELI Products issued by Macquarie Structured Products Asia
Limited.
7.1
All offer documents, including any information memorandum, financial
statements, product booklets and term sheets, are issued by the issuer of the
relevant equity-linked product. We
expressly disclaim all liabilities in respect of all offer documents. We do not in any way guarantee or give
any assurance in respect of the obligations of any issuer.
7.2
We act only as a distributor of equity-linked products and not as agent
for the issuer. We have no
authority to accept or refuse applications for equity-linked products on behalf
of the issuer. Our nominee and we will act as your agent in relation to
equity-linked products. You authorise us to take all actions, give all
confirmations and representations, and to do all things that we consider
necessary or desirable in connection with carrying out your instructions
relating to any equity-linked product.
7.3
You agree to be bound by the terms and conditions of the relevant offer
documents in addition to these Conditions, and to pay in
full for and accept the
equity-linked products you applied
for or any lesser amount allotted to you. If full payment is not received from
you when due, your equity-linked product may be closed out and you will be
responsible for all losses and expenses. We may aggregate your application with
applications made by our other clients and make a single application in the name
of our nominee. In the event of the application being partly successful, we may
allocate the equity-linked product among yourself and our other
clients
7.4
The purchase price and any fees payable by you will be as set out in our
confirmation sent to you. Our nominee and we may accept and retain commissions
and fees from the issuer in connection with any equity-linked product, without
liability to account or disclose to you.
7.5
You confirm that you will have read and understood the contents of the
relevant offer documents in your preferred language (including the risk
disclosures and terms and conditions, as supplemented or modified from time to
time) and agree to give all required confirmations. By giving an instruction to
purchase an equity-linked product, you are deemed to have accepted the relevant
offer documents. You will conduct your own assessment whether the equity-linked
product is suitable for you in the
light of your financial position and investment objective, before giving
any instruction to purchase an equity-linked product. You will determine that
you have sufficient income and net worth to be able to assume the risks and bear
the potential losses associated with each equity-linked product you wish to
purchase. You
understand that no certificate of title will be available for equity-linked
products.
7.6
You warrant that you will purchase each equity-linked product for your
own account and not for any other person, and that you will purchase each
equity-linked product for investment purpose and not with a view to, or for
resale in connection with, any distribution or disposition thereof. Your
interest in an equity-linked
product may
not be transferable without the prior written consent of the issuer.
7.7
You acknowledge that an equity-linked product may have ownership or
trading prohibitions or restrictions (which may or may not be set out in the
offer documents). By giving an instruction to purchase an equity-linked product,
you will warrant that you are not subject to any such prohibitions or
restrictions, and that your purchase of the equity-linked product complies with
all applicable laws and regulations.
7.8
You understand that some of the equity-linked products are not intended
for offer or sale to the public and no prospectus has been issued in relation to
them. No offer documents shall be
considered as a prospectus and any offer or information relating to
equity-linked products is communicated to you on a strictly private and
confidential basis for your personal use only. You will not pass on any such
information to third parties.
7.9
You will not rely on any communication (whether written or oral) from us
(including our directors, officers, employees, agents or nominees) as investment
advice or as recommendation to purchase any equity-linked product. You acknowledge that we will not provide
you with tax, legal or financial advice in relation to any equity-linked
product. You will not rely on the issuer or its affiliates in assessing the
merits, risks and suitability of purchasing any equity-linked product. You
understand that information and explanations in the relevant offer documents
should not be considered as investment advice or a recommendation to purchase
the equity-linked product.
7.10
You acknowledge that you may not have any direct contractual relationship
with the issuer. In the event of
default by the issuer or any guarantor, any legal action against them may only
be taken by us, at your written request and after you have provided us with full
indemnity and security satisfactory to us in respect of all costs and expenses
that might be incurred (in the amount estimated by us in good faith).
7.11
We need not commence or continue with any action if we consider that it
is not appropriate. We will have absolute control over any legal action
(including to settle or discontinue it).
If we act in good faith and on legal advice, we will not in any circumstances
incur any liability to you if we decide against commencing or continuing with
any action, or in respect of any actions taken or not taken in connection with
any legal action.
7.12
Equity-linked products will
be registered in the name of our nominee. You will have to rely on us to credit
your account with us with payments and securities received by our nominee on
your behalf from the issuer, to distribute notices our nominee receives from the
issuer, and to relay your notices to the issuer.
7.13
If
your application for an equity-linked product is not successful in whole or
part, the purchase money will be returned to you without interest by the issuer
through our nominee.
7.14
The market value of equity-linked products shown on your monthly
statement may only represent their nominal value. The proceeds which you may obtain on
selling back (if permitted) an equity-linked product prior to its maturity, and
the proceeds or value of any shares which you may obtain at maturity, may be
less than the face value of the equity-linked product (possibly significantly,
depending on market conditions). In the absence of manifest error, the register
maintained by the issuer is definitive as to holdings of the relevant
equity-linked product.
7.15
You agree that we may provide your personal information to the issuer and
its agents and affiliates for the purposes of equity-linked products, and to
regulatory or government authorities (in or outside
PART 2
-
CUSTODY OF
SECURITIES
1.
CUSTODY OF
SECURITIES
1.1
All your securities delivered to and accepted by us for the Custody
Account will be held under the terms and conditions of this
Part.
1.2
If we are holding your Hong Kong listed securities in safe custody in
Hong Kong, we will arrange for them to be registered or held in safe custody in
accordance with
1.3
Where securities for the Custody Account are not registered in your name,
any dividends or other benefits arising in respect of such securities shall,
when received by us and in the absence of your specific instructions, be
credited to the Custody Account or, in the case of cash, to your other account
with us. Where the securities form
part of a larger holding of identical securities held for our clients, you shall
be entitled to the same share of the benefits arising on the holding as your
share of the total holding.
1.4
All securities in the Custody Account are subject to a general lien for
the discharge of all your liabilities to us. If you do not perform any of your
obligations, we may sell your securities or part thereof (whether held by us for
safe custody or otherwise) at such price, on such terms and by such method as we
may determine. We may apply the net
proceeds to reduce all or any of your liabilities to us on any
account.
1.5
We shall where applicable notify you of rights issues, take-over offers,
capitalisation issues, exercise of conversion or redemption or subscription
rights, voting and other rights attaching to your securities. Subject to receiving your instructions
in time for us to act and, if payment is required, to receipt of cleared funds,
we shall arrange for action to be taken.
If action is required but you cannot be contacted or fail to give us
punctual or adequate instructions, we may (but are not obliged to) act as we
think fit in our discretion.
1.6
You authorise us to take all necessary actions to comply with applicable
laws, and the rules, regulations and codes issued by the Hong Kong Monetary
Authority and the SFC, and the rules of exchanges and clearing houses, including
withholding or making payment of tax or duties in respect of cash or securities
in the Custody Account.
1.7
You understand that your securities will be held by us uninsured unless
otherwise specifically agreed in writing with us.
1.8
The authorised representative from time to time of your account with us
as specified by you have full authority to give all kinds of instructions to us
in relation to the Custody Account for and on your behalf.
1.10
We may appoint and pay any sub-custodians or nominees to hold all or any
assets or to perform any services under this Part. We will not be responsible in any manner
whatsoever to you for any act or omission of any nominee or
custodian selected by us.
2.
FEES
2.1
You will pay our fees, commissions and charges, and all out-of-pocket
expenses including the expenses of our sub-custodians and nominees, in each case
in the amounts and within the times as notified to you, as well as applicable
fees of the relevant exchange, clearing house and registrar, levies of any
regulatory authority, and all applicable stamp duties, taxes and expenses. We may deduct such fees, commissions,
charges, expenses, levies, duties, taxes and expenses from the Custody Account
or your other accounts with us.
2.2
If any securities require special or unusual safe custody, you shall pay
all expenses reasonably incurred by us in providing such safe
custody.
3.
TERMINATION
3.1
Either party may terminate the custodial service under this Part at any
time by 30 day's notice to the other party.
3.2
Subject to our rights and completion of transfer of any securities to us
or to you, your securities and any relevant documents of title in our possession
shall be collected by you from us within 7 days of the termination of this
Part. Any delivery to you by us
(acting reasonably) shall be at your own sole risk and
expense.
3.3
If within 7 days or such longer period as we may agree following the
termination of the custodial service under this Part, you have not collected
your securities from us, we shall continue to hold such securities but without
the obligations imposed on us under this Part.
4.
GENERAL
4.1
We have no duty to verify the validity of ownership or title to any
assets accepted for the Custody Account or the validity or genuineness of any
documents received in connection with any assets in the Custody
Account.
4.2
You authorise us and any person appointed by us to execute documents and
otherwise act on your behalf for all purposes connected with our custodial
services.
4.3
Payments to be made or received in a currency other than
4.4
You will be responsible for filing tax and other returns and reports on
transactions which we handle for the Custody Account.
4.5
You may not assign, mortgage or charge the Custody Account without our
prior written consent.
4.6
We will provide you with monthly statements of your securities and other
investment accounts, unless a statement is not required under applicable
regulation. Please notify us if you do not receive a statement. Unless you
notify us of your disagreement with a statement within 90 days, you will be
deemed to have accepted it. You
will not however be liable for unauthorised transactions arising from forgery or
fraud (a) by any third party in relation to which we have failed to exercise
reasonable care and skill, or (b) by our employee or agent, or other
unauthorised transactions arising from our default or negligence.
PART 3 - DEPOSIT PRODUCTS AND
OPTIONS
Each equity-linked deposit, currency-linked deposit,
share option or currency option made with us is referred to as a
"Transaction".
1.
SINGLE
AGREEMENT
The parties have
entered into and will enter into each Transaction in reliance upon the fact that
all Transactions constitute a single contractual relationship
("Agreement"). Accordingly, each of the parties agrees (a) to perform all
of its obligations in respect of each Transaction, and that a default in the
performance of any such obligations shall constitute a default by it in respect
of all Transactions, (b) that each of them shall be entitled to set off claims
against it and apply property held by it in respect of any Transaction against
obligations owing to it in respect of any other
Transaction.
(a) A "Market Disruption Event" means any suspension or limitation
of trading in the underlying shares on The Stock Exchange of Hong Kong Limited
or in any options contracts or futures contracts relating to the underlying
shares on any relevant exchange as determined by us, or any other event which,
in our opinion, has a material effect on the market for the underlying shares,
which occurs at any time on the date for determining the price of the underlying
shares.
(b) If, in our
sole discretion, we determine that on a Fixing Date, a Market Disruption Event
has occurred and is continuing, then the Fixing Date will be the next Trading
Day on which there is no Market Disruption Event, and the Closing Price will be
calculated by us accordingly. If a Market Disruption Event continues for 5
Trading Days after the original Fixing Date, the Closing Price will be the price
per share of the underlying shares estimated by us in good faith on the 5th
Trading Day as the price which could be obtained for the underlying share. The
Maturity Date will automatically be postponed by the same number of
days.
(c) The
occurrence of a Market Disruption Event on any date during the period commencing
from the date a Transaction is agreed and ending on a Deposit Date (both dates
inclusive) will not affect the Transaction or the Deposit Date.
(d) A
"Trading Day" means a trading day on The Stock Exchange of Hong Kong
Limited, other than a day on which trading is scheduled to close before its
regular weekday closing time, and which is a day on which banks are open in Hong
Kong for business.
(a)
An "Adjustment Event" occurs if there is a dividend,
distribution, split, extraordinary dividend (as determined by us in our sole
opinion), consolidation, rights offering, repurchase, reorganization,
recapitalization, reclassification, alteration or any other event in respect of
the underlying shares having, in our opinion, a diluting or concentrative effect
on the market value of the underlying shares, or a merger, consolidation,
amalgamation, takeover, dissolution, insolvency, liquidation, nationalization or
expropriation of the issuer of the underlying shares or its assets or the
underlying shares, or the underlying shares cease to be actively traded on or
are de-listed from The Stock Exchange of Hong Kong Limited or cease to be
publicly traded, or any event of a type for which adjustments are customarily
made in respect of traded options or futures on shares in Hong
Kong.
(b)
Adjustments may be made by us to any of the conditions and terms of the
affected Transactions including without limitation to the Conversion Price
and/or the identity of the underlying shares following the occurrence of any
Adjustment Event. Such adjustments will be made as will, in our sole discretion,
preserve the economic equivalent of your obligations under the Transaction. In
the event of a liquidation or dissolution of the issuer of the underlying shares
on or before the Fixing Date, the underlying shares will be deemed to have no
value.
(a)
If on the Fixing Date or any date thereafter prior to the delivery of the
underlying shares to you, the register of members of the issuer of the
underlying shares is closed, or there is a suspension in trading in the
underlying shares, or there exists any event beyond our control by reason of
which, as determined by us in our sole discretion, we are unable to deliver the
underlying shares to you, delivery of underlying shares will be postponed until
such register of members is open, trading is resumed or we are able to deliver
the underlying shares.
(b)
We are not obliged to account to you for any entitlement received or
receivable in respect of the underlying shares if the date on which the
underlying shares are first traded on The Stock Exchange of Hong Kong Limited ex
such entitlement, as determined by us in our sole discretion, is on or prior to
the Maturity Date.
(c)
We are not obliged to deliver to you any fraction of an underlying share.
If the amount of the underlying shares to be delivered to you exceeds the amount
of the board lot for such shares or a whole multiple thereof, we are not obliged
to deliver such excess to you, and may pay a cash amount in lieu of delivery of
such excess equal to the Closing Price multiplied by the number of such
excess.
(d)
After delivery of the underlying shares to you and until you are entered
in the register of members of the relevant company as the registered holder of
the underlying shares, we are not obliged to deliver to you any certificate,
notice, circular, dividend or any other document or payment received by us or
our agent or nominee in our or its capacity as the registered holder of the
underlying shares, or to exercise any rights attaching to the underlying shares,
or be under any liability in respect of any loss or damage suffered by you as a
direct or indirect result of our or our agent or nominee being registered as
such holder. We are not obliged to register or procure the registration of
yourself or any other person as the registered holder of the underlying shares
in the register of members of the relevant company.
2.4
Further provisions
(a) If
the agreed Deposit Date falls on a non-banking day, it will be postponed to the
next banking day. The Maturity Date
will remain unchanged. Interest
will be calculated on the deposit for the entire, original period, subject to a
deduction at a daily rate equal to our 24-hour call deposit rate in respect of
the period of postponement of the Deposit Date.
(b) If the
Maturity Date falls on a non-banking day (in which case it will be postponed to
the next banking day) or has been postponed by reason of a Market Disruption
Event, interest will be calculated on the deposit, if the deposit is to be
settled by repayment of principal and interest, for the period of postponement
only at a daily rate equal to our 24-hour call deposit
rate.
(c)
Deposits can only be made
in the currency, amount and terms which we accept.
(d) Deposits
will be repaid to the credit of an account with us as specified by you or, if
necessary, as selected by us.
(e) The
amount (including interest, where applicable) and the currency in which the
deposit will be repaid to you on maturity are as specified in the relevant
Confirmation.
(f)
Deposits may not be withdrawn before maturity without our consent. We may refuse early withdrawal. If we permit early withdrawal, we may
deduct from the deposit amounts determined by us to compensate for losses and
expenses including breakage, hedging and funding costs. The amount repaid to you may be less
than the principal amount of the deposit.
(g) Deposits
will not be automatically renewed.
3.
SHARE OPTIONS
3.1
An "American Option" is an option which is exercisable between
3.2
Premium
(a)
Unless otherwise agreed in writing by the parties, the Buyer shall pay
the Premium related to an Option no later than its Premium payment date.
(b) If any
Premium is not received by us on or before the Premium payment date, we may
elect: (i) to accept a late payment of such Premium; (ii) to give written notice
of such non-payment and, if such payment is not received within 2 banking days
of such notice, treat the related Option as void; or (iii) to give written
notice of such non-payment and, if such payment is not received within 2 banking
days of such notice, treat such non-payment as an Event of Default. If we elect
to act under either (i) or (ii), you shall pay to us all out-of-pocket costs and
actual damages incurred in connection with such unpaid or late Premium or void
Option, including without limitation interest on such Premium from and including
the Premium payment date to but excluding the date of actual payment at the
prime rate quoted by us and any other losses, costs or expenses incurred by us
in connection with such terminated Option, for the loss of our bargain, our cost
of funding, and the loss incurred as a result of terminating, liquidating,
obtaining or re-establishing hedge or related trading positions with respect to
such Option.
3.3
Automatic exercise
Unless the Seller of an Option is otherwise
instructed in writing by the Buyer prior to such time, if automatic exercise is
specified to be applicable in the Confirmation for the Option, such Option shall
be deemed to be automatically exercised at the Expiration Time on the Expiration
Date:
(a) if
cash settlement is applicable; or
(b) where
physical settlement is applicable, if at such time the Option is In-the-money,
unless the Reference Price cannot be determined at such time. A call option is
"In-the-money" if the Reference Price is greater than the Strike Price. A put
option is "In-the-money" if the Reference Price is less than the Strike
Price.
3.4
Cash settlement
If cash settlement is applicable for an
Option, the Seller shall pay to the Buyer an amount, as calculated by us, equal
to the number of options exercised or deemed exercised multiplied by the Option
Entitlement multiplied by an amount equal to the greater of (a) the excess of
(i) in the case of a Call, the Reference Price over the Strike Price or (ii) in
the case of a Put, the Strike Price over the Reference Price, and (b)
zero.
3.5
Market disruption
Condition 2.1(a) and (b) apply to share options, as if references
therein to "Fixing Date", "Closing Price" and "Maturity Date" were references to
"Exercise Date", "Reference Price" and "Settlement Date" respectively. "Exercise Date" means, in respect
of an Option exercised or deemed exercised, the Expiration Date in the case of a
European option; and the Trading Day on which the option is exercised, in the
case of an American option.
3.6
Adjustment
Condition 2.2(a) and (b) apply to share
options, as if the reference therein to "Conversion Price" were a reference to
"Strike Price, the number of options and the Option Entitlement", and except
that the last sentence thereof will not apply.
4.
CURRENCY OPTIONS
4.2
Conditions 3.1 and 3.2 apply to currency options as if the references
therein to "Trading Day" were references to Business Day. "Business Day" means a day other than a
Saturday or a Sunday on which banks effect delivery of the relevant currency in
accordance with the market practice in
4.3
Automatic
exercise
Unless the Seller of an
Option is otherwise instructed in writing by the Buyer prior to such time, if
automatic exercise is specified to be applicable in the Confirmation for the
Option, such Option shall be deemed to be automatically exercised at the
Expiration Time on the Expiration Date, if at such time the Option is
In-the-Money. A call option is
"In-the-Money" if the Spot Rate is greater than the Strike Price. A put option is "In-the-Money" if the
Spot Rate is less than the Strike Price.
4.4
Settlement
An exercised Option shall
settle on its Settlement Date. Subject to Condition 4.5, on the Settlement Date,
the Buyer shall pay the Put Currency to the Seller for value on the Settlement
Date and the Seller shall pay the Call Currency to the Buyer for value on the
Settlement Date.
4.5
Settlement at In-the-Money Amount
An Option shall
be settled at its In-the-Money Amount if so agreed by the parties at the time
such Option is entered into. The In-the-Money Amount means (a) in the case of a
Call, the excess of the Spot Rate over the Strike Price, multiplied by the
amount of the Call Currency to be purchased under the Call, where both prices
are quoted in terms of the amount of the Put Currency to be paid for one unit of
the Call Currency; and (b) in the case of a Put, the excess of the Strike Price
over the Spot Rate, multiplied by the amount of the Put Currency to be sold
under the Put, where both prices are quoted in terms of the amount of the Call
Currency to be paid for one unit of the Put Currency. The sole obligations of the parties with
respect to settlement of such Option shall be to deliver or receive the
In-the-Money Amount of such Option on the Settlement Date.
5.
CURRENCY-LINKED DEPOSITS
Condition 2.4 applies to currency-linked
deposits.
6.
EVENTS OF DEFAULT
6.1
An "Act of Insolvency"
means:
An "Event of Default" means (a) an Act
of Insolvency with respect to you, (b) any representation made by you being
incorrect or untrue in any material respect when made or repeated or deemed to
have been made or repeated, or (c) your failure to perform any of your
obligations pursuant to any Transaction.
6.2
If an Event of Default occurs, we may, at our option (which option shall
be deemed to have been exercised immediately upon the occurrence of an Act of
Insolvency), and without prior notice to you, liquidate and close out one or
more Transactions. Liquidation of
Transactions shall be
effected as follows:
(a) we
shall calculate in good faith with respect to each terminated Transaction, as of
the date on which the Transactions are closed out
("Close-Out Date") or as soon as reasonably practicable thereafter
a settlement amount for each party equal to the aggregate
of:
(i)
with respect to each Option purchased by such party, and which we have
not elected to treat as void pursuant to Condition 3.2(b) for lack of payment of
the Premium, the current market premium for such Option;
(ii) with
respect to each Option sold by such party, and which we have not elected to
treat as void pursuant to Condition 3.2(b) for lack of payment of the Premium,
any unpaid Premium, provided that, if the Close-Out Date occurs before the
Premium payment date, such amount shall be discounted from and including the
Close-Out Date to but excluding the Premium payment date at a rate equal to the
prime rate as quoted by us and, if the Close-Out Date occurs after the Premium
payment date, any unpaid Premium shall carry interest from and including the
Premium payment date to but excluding the Close-Out Date at the prime rate as
quoted by us;
(iii) with
respect to any exercised Option (whether or not the Close-Out Date occurs before
the Settlement Date for such Option) or matured Transaction, any unpaid amount
due to such party in settlement of such Transaction and, if the Close-Out Date
occurs after the Settlement Date for such Option or the Maturity Date for such
Transaction, interest thereon from and including the Settlement Date or Maturity
Date to but excluding the Close-Out Date at the prime rate as quoted by us;
and
(iv) without
duplication, the amount that we determine in good faith, as of the Close-Out
Date or as of the earliest date thereafter that is reasonably practicable, to be
our additional losses, costs and expenses in connection with such terminated
Transaction, for the loss of our bargain, our cost of funding, and the loss
incurred as a result of terminating, liquidating, obtaining or re-establishing
hedge or related trading positions with respect to such
Transaction;
(b) converting
any settlement amount calculated in accordance with paragraph (a) above in a
currency other than Hong Kong dollars into Hong Kong dollars at the spot rate of
exchange quoted by us for the purchase of Hong Kong dollars with such currency
(or, if such spot rate of exchange is not available, conversion shall be
accomplished by us using any commercially reasonable method);
and
(c)
netting such settlement amounts with respect to each party so that all
such amounts are netted to a single liquidated amount payable by one party to
the other party as a settlement payment.
6.3
You shall also be liable to us for:
(a) the
amount of all reasonable legal or other expenses incurred by us in connection
with an Event of Default, any collection or other enforcement proceedings
related to the payments required under the Agreement;
(b) any other
loss or damage directly arising from the occurrence of an Event of Default; and
(c)
interest on any amounts owing by you under the Agreement, from the date
you become liable for such amounts until such amounts are (i) paid in full by
you, or (ii) satisfied in full by the exercise of our rights under the
Agreement. Interest on any sum payable by you to us under Condition 6 shall be
at a rate equal to the prime rate as quoted by us from time to time plus
2% per
annum.
6.4
The parties agree that the amounts recoverable under Condition 6 are a
reasonable pre-estimate of loss, payable for the loss of bargain and the loss of
protection against future risks.
7.
FORCE MAJEURE
A "Waiting Period",
in respect of a Force Majeure Event, means the first three days after such event
occurs which are Business Days (in the case of a currency-linked deposit or a
currency option) or Trading Days (in the case of an equity-linked deposit or
share option) or which, but for such event, would have been Business Days or
Trading Days as the case may be.
7.2
If a Force Majeure Event occurs and is still in effect, we may (subject
to Condition 7.3), by notice to you on any day(s) after the Waiting Period
expires, require the close-out and liquidation of any or all of the affected
Transactions in accordance with the provisions of Condition 6. If we elect to
liquidate less than all affected Transactions, we may liquidate additional
affected Transactions on a later day or days if the relevant Force Majeure Event
is still in effect.
7.3
If the Settlement Date of an affected Transaction falls during a Waiting
Period, then such Settlement Date will be deferred to the first Business Day or
Trading Day as the case may be (or the first day which, but for such event,
would have been a Business Day or Trading Day as the case may be) after the end
of that Waiting Period.
Compensation for this deferral shall be at then current market rates as
determined in a commercially reasonable manner by us.
7.4
If a Force Majeure Event has occurred, an affected party shall promptly
give notice thereof to the other party.
7.5
If an event occurs that would otherwise constitute both a Force Majeure
Event and an Event of Default, that event will be treated as a Force Majeure
Event and not as an Event of Default.
PART 4 -
INVESTMENT FUNDS
1.
FUND SERVICES
(a)
accept payment by credit card or debit the relevant sum from your
designated account and apply to the manager, custodian, trustee or other
relevant person ("Fund Operator") to subscribe or apply for units, shares
or interests ("units") in such unit trusts, mutual funds, collective
investment schemes or other investments as we may agree at our discretion from
time to time ("Funds");
(b) apply to
the Fund Operator to redeem, transfer or (where applicable) convert units held
by us for you.
1.2
Your application to the Fund Operator may be given in our or our
nominee’s name, together with our other clients’ applications. We have no
authority from any Fund Operator to accept any application. The Fund Operator
may subsequently reject your application, although it has been accepted by us.
We have no further obligations following transmission of your application to the
Fund Operator. The number of units to be allocated by us to your account may be
rounded down.
1.3
Your Settlement Account is specified at the beginning of these Conditions
or other account(s) with us notified by you and accepted by us.
1.4
We will credit your Settlement Account with the redemption proceeds and
any income of your units held by us only after the money has been actually
received by us and after deducting relevant expenses. Unless otherwise agreed
with you in writing, we are not required to take any action to collect sums
payable in respect of your units or to inform you if any payment is
overdue.
1.5
Before giving any instruction to acquire or deal with any unit, you will
have read, understood and agreed to be bound by the offering and constitutive
documents and application form and procedure of the relevant Funds. You will
ensure that your instructions conform to the requirements of the Funds. We are
not responsible to check if this is the case, and are authorised at our
discretion to reject any instruction, to transmit it to the Fund Operator
without change, or to make any necessary changes to confirm with the
requirements of the Funds, without reference to you.
1.6
We need not take any action until we have received all necessary funds,
instructions and documents, but may do so. We may on receipt of your instruction
put a "hold" on an amount estimated by us to be required to carry out your
instruction. Whether or not we do so, if you fail to put us in funds to make a
purchase, we may sell the purchased units without notice to you and apply the
proceeds to reimburse ourselves.
You will pay any deficit to us on demand.
1.7
If your instruction cannot be executed in whole or part, we are not
required to notify you immediately.
An instruction may be partially executed if it cannot be fully
executed. We will decide allocation
among you and other clients in a fair manner.
2.
CUSTODY
2.1
You appoint us your nominee to hold all units acquired on your behalf. We
will arrange for registered units to be registered in the books of the Fund
Operator in the name of our nominee, and otherwise for custody of your units and
any certificates in accordance with applicable laws and regulations. We will
record your units held by us in an account in your name ("Fund Account")
maintained by us.
2.2
If minimum holding requirements apply, any holding below the minimum
number of units may be required to be redeemed.
2.3
Where your units form part of a larger holding of identical units held
for our clients, you will be entitled to the same share of the payments arising
on the holding as your share of the total holding.
2.4
We are not required to attend meetings of unit holders, to vote at such
meetings, or to exercise any right of the holder unless otherwise agreed with
you in writing.
2.5
We may appoint sub-custodians or nominees to hold units or to perform any
services. We will use reasonable
care in selecting nominees or custodians.
2.6
Instructions to withdraw or transfer units will be subject to completion
of transfer to you or your transferee according to the rules of the Funds and
payment of relevant fees and expenses.
3.
OUR ROLE
3.1
We act as your agent under this Part, not as trustee or fiduciary. Our responsibilities are limited to
those expressly set out in these Conditions.
3.2
You authorise us and any person appointed by us to execute all documents
and do everything which may be necessary or desirable for all purposes connected
with our services.
3.3
You agree that all transactions will be subject to the laws, regulations
and rules applicable to the Funds or to us, including the rules of the Funds,
and the rules, codes and guidelines of any regulatory authorities, exchanges and
clearing houses. We may do or
refrain from doing anything in order to comply with such laws, regulations and
rules. All such actions or
omissions bind you.
3.4
You agree that we may accept from the Fund Operators and other persons
engaged in your transactions any rebate, reallowance or soft commission as may
be authorised from time to time by regulatory authorities or the rules of
applicable exchanges.
4.
INSTRUCTIONS
4.1
Unless you have otherwise advised us, the authorised representative of
your Settlement Account has full authority to do everything for you in relation
to your units, including to sell or buy units, withdraw money and units, and
give any instructions. All instructions given or purported to be given by you or
your authorised representative are binding on you. We may, at our discretion, decline to
accept any instructions without giving any reason.
4.2
If any action is required in respect of your units, and we have not
received your instructions as to the action to be taken, we may (but are not
obliged to) act at our discretion and without liability to
you.
5.
INFORMATION
5.1
You confirm that all information provided to us for the purpose of this
Part and every transaction under this Part is complete and accurate. You will promptly inform us of any
material change to that information.
We may conduct enquiries to verify your
information.
5.2
We will inform you of any material changes to our name, address,
registration status, CE number, the nature of our services under this Part, or
our fees or charges.
5.3
We will provide you with monthly statements of the Fund Account, unless
a statement is not required under
applicable regulation. Please
notify us if you do not receive a statement. Unless you notify us of your
disagreement with a statement within 90 days, you will be deemed to have
accepted it and will not subsequently dispute it. You will not however be liable for
unauthorised transactions arising from forgery or fraud (a) by any third party
in relation to which we have failed to exercise reasonable care and skill, or
(b) by our employee or agent, or other unauthorised transactions arising from
our default or negligence.
5.4
Reports, accounts and other documents received in respect of Funds will
be held by us for such period as we may decide, and will be available for your
inspection during such period.
Thereafter we will destroy such documents. Unless otherwise agreed in
writing, you do not require us to forward such documents to you or notify you of
their receipt.
5.5
All information relating to Funds provided by us to you is provided by or
based on information received from the Fund Operator. We have not verified the
information and are not responsible for any error or
omission.
6.
FEES
6.1
You acknowledge receipt of a list of our fees and charges. We may change
our fees and charges from time to time after notice to
you.
6.2
You will pay our fees and charges, and all out-of-pocket expenses
including sums payable in respect of your units, overdraft interest arising from
your transactions, the expenses of our sub-custodians and nominees, applicable
fees of any exchange, clearing house, registrar and regulatory authority, and
applicable stamp duties, taxes and expenses. You will pay in the amounts and within
the times notified to you. We may deduct all such amounts from your accounts
with us.
7.
YOUR REPRESENTATION
You represent to us that you are the sole
beneficial owner of all units held by us, free from third party claims or
interests. This representation will survive termination of these
Conditions.
8.
LIMIT OF
LIABILITY
8.1
Any recommendation or information given by us to you are for your
reference only. Reliance on such recommendation or information is at your own
risk. The actual price in respect of Funds are determined by the Fund Operator,
and any quotation provided by us are only indicative. We make no representations
regarding the performance of your investment.
8.2
We have no duty to verify the validity or genuineness of any documents
received in connection with any assets under these
Conditions.
8.3
We have no duty to enquire whether any Fund Operator is performing its
duties.
9.
MATERIAL INTEREST
When effecting transactions for you, our
associates or we may have a material interest in relation to the transaction or
units concerned. In particular, our
associates or we may:
(a)
effect transactions where an associate or we have a position in the units
or are involved as manager, custodian, trustee or otherwise;
or
(b) match
your order with those of other clients.
If we have an actual or potential conflict of
interest in relation to a transaction, we will not act in relation to the
transaction unless we have disclosed that conflict to you and have taken all
reasonable steps to treat you fairly.
We may have existing or future commercial or banking relationships with
the
Fund Operators or their
affiliates, and will pursue actions which we deem appropriate to protect our
interests, without any obligation to disclose or account to you, and regardless
of whether any such action might adversely affect you.
10.
TERMINATION
10.1
Either party may terminate these Conditions by 30 day's notice to the
other party.
10.2
Within 7 days after the termination of these Conditions or such longer
period as we may agree, you will give us instructions for the delivery (at your
sole risk and subject to our rights) of your units, together with payment of all
relevant fees and expenses. If you
have not done so, we will continue to hold such units subject to the protections
conferred on us under these Conditions but without the obligations imposed under
these Conditions.
11.
LIEN
All units in the Fund Account and related certificates and documents are
subject to a general lien for the discharge of all your liabilities to us. If you do not perform any of your
obligations, we may sell your units or part thereof (whether held by us for safe
custody or otherwise) at such price, on such terms and by such method as we may
determine. We may apply the net
proceeds to reduce all or any of your liabilities to us on any
account..
12.
GENERAL
12.1
Payments to be made for the purchase of the Funds in a currency other
than that of the Funds or received in respect of the Funds in a currency other
than that of the Settlement Account may be converted by us into the applicable
currency at the rates and times selected by us.
12.2
You will be responsible for filing tax and other returns and reports on
the transactions we handle for you.
12.3
Payments will be made to
you subject to applicable laws and regulations and any tax deduction or
withholding.
12.4
You may not transfer, assign, mortgage or charge your units or
transactions or the Fund Account or these Conditions without our prior written
consent.
PART 5 -
GENERAL
APPLICATION
1.
REPRESENTATIONS
In connection with each transaction, you
represent and acknowledge to us that:
(a) you
are not relying on any advice, statements or recommendations (whether written or
oral) from us regarding that transaction;
(b) you have
made your own independent decision to enter into the transaction and as to
whether that transaction is appropriate or proper for you based upon your own
judgment and upon advice from such third party advisors as you have deemed
necessary;
(c) you
have not received from us any assurance or guarantee as to the expected results
of that transaction;
(d) we are not
acting as a fiduciary or an advisor for you in respect of that
transaction;
(e) you
understand and accept the terms, conditions and risks of that transaction and
you are willing to accept those terms and conditions and to assume (financially
and otherwise) those risks;
(f) you
are entering into that transaction as principal and not as agent for any
other person, unless you notify us otherwise in
writing;
(g) you are
entering into that transaction for the purpose of managing your borrowings or
investments, hedging your underlying assets or liabilities or in connection with
your business;
(h)
you have all necessary
licenses and approvals, and are duly authorised, to perform your obligations
under that transaction;
(i)
you are not restricted under the terms of your constitution (if
applicable) or in any other manner from performing your obligations under that
transaction; and
(j)
all documents and information you deliver and provide to us for the
purpose of these Conditions are valid, complete and accurate.
The representations contained in this
Condition 1 will survive termination of these Conditions.
2.
INFORMATION
We shall keep your information confidential, but may provide any such
information to any exchange or regulatory authority to comply with their
requirements or requests for information.
Your information may also be disclosed in accordance with our notice from
time to time in relation to the Personal Data (Privacy)
Ordinance.
3.
INSTRUCTIONS
3.1
Unless you have otherwise advised us, your authorised representative has
full authority to do everything for you in relation to your Securities Accounts,
Custody Accounts, Settlement Account, Fund Account and all Transactions
including to give any instructions, withdraw money and securities/ units, enter
into and otherwise deal with any Transactions. All instructions given or
purported to be given by any means by you or your authorised representative to
us are binding on you. We may, in
our discretion, decline to accept any instructions without giving any
reason.
3.2
You will give instructions to us in writing or through a means we have
agreed. We may reject or act on an
instruction not so given. We may
act on an instruction which is inconsistent with an existing arrangement,
without enquiry.
3.3
You may change your authorised representative or signing arrangements by
notice to us and by providing us with required documents. We may reject an instruction dated prior
to the change but subsequently received.
3.4
We may regard your instructions as received by us as being what you
intended to send. We need not
verify the identity or authority of the person giving an instruction or the
authenticity of an instruction. We
may at our discretion require evidence of identity or authority.
3.5
Without prejudice to condition 3.4 above, we
shall be entitled to act upon any trading instructions given or which we
reasonably believe to be given by you verbally via telephone without verifying
your identity by personal identification number. You understand that there are
high risks inherent which have been communicated to you prior to the use of
phone instructions
but
agree that the benefits justify these risks. All instructions given or which we
reasonably believe to be given by you shall be binding on
you.
3.6
An instruction once accepted cannot be altered or cancelled, without our
agreement.
4.
LIMIT OF
LIABILITY, INDEMNITY AND
INTEREST
4.1
We will not be liable for:
(a) any event beyond our control;
(b) any action which we shall take or omit to take under these
Conditions; or
(c) any loss or damage arising from (i) our custody of your assets or any
service under these Conditions or (ii) our acceptance of any instructions given or which we reasonably believe
to be given by
you,
unless due to our gross
negligence or fraud.
4.2
You shall on demand indemnify us against any liabilities, losses or
reasonable expenses resulting from your settlement failures or other default or
the provision of our services under any transaction or these
Conditions.
4.3
You agree to pay interest
on all overdue balances (including interest arising after a judgment is obtained
against you) at such rates and on such other terms as we have notified you from
time to time.
4.4
Interest will be paid to you subject to any applicable fiscal or other
laws and regulations and to any deduction or withholding in respect of tax
required by law.
4.5
We may effect any necessary currency conversions for the purposes of
these Conditions at the spot rate of exchange (as determined by us in our
discretion) prevailing in the relevant foreign exchange market (as selected by
us in our discretion) on the relevant date.
5.
EVIDENCE
5.1
We may tape conversations with you without a warning device. Our tape may be used as evidence of the
contents of the conversation.
5.2
Our accounts and records are conclusive of the matters or facts therein
stated, and you agree not to dispute them in the absence of manifest
error.
5.3
All calculations,
estimates and determinations by us for the purposes of these Conditions and each
transaction are, except to the extent of manifest error, conclusive and binding
on you.
6.
TERMINATION
6.1
These Conditions may be
terminated by either party by notice to the other, but shall remain applicable
to any transaction then outstanding.
The obligations of the parties under these Conditions will survive the
termination of any transaction.
6.2
Upon termination of these Conditions, all amounts owing by you under
these Conditions will become immediately payable. We may close out and liquidate
any or all transactions in accordance with the provisions of Condition 6, Part
3. After deducting amounts owing to you, the cash and securities / units (if
any) in the Securities Account and the Custody Account or the Settlement Account
and the Fund Account (as the case may be) will be delivered to you at your sole
risk and expense. Acting reasonably, we will have no liability for any loss or
damage arising from such delivery.
7.
COMMUNICATIONS
Without affecting other methods of
communication, communications to you are deemed to be received by you on posting
for 3 banking days in one or more of our banking halls in Hong Kong, 3 days
after publication as an advertisement in a Hong Kong newspaper, when
communicated including by leaving a voice message, if by telephone or other oral
communication, when left at your latest address on our record, or 48 hours after
posting to such address or 7 days if the address is overseas, or when sent by
email or facsimile to your latest email address or facsimile number on our
record, notwithstanding their return through the post, and notwithstanding your
death or incapacity.
8.
GENERAL
8.1
We may change these Conditions by notice to you. Where practicable, 90 days' prior notice
will be given. Notwithstanding the
foregoing, prior notice of any change to the provisions of the equity‑linked
deposits will be given in any event.
8.2
Time is of the essence in respect of anything to be done by you under
each transaction.
8.4
If you are 2 or more persons, your obligations are joint and several, and
your powers are joint. We may notify you by notifying any one of you. We may
accept instructions from, give receipts to and for all purposes deal with any
one of you unless we have received written instructions to the contrary. Our payment or delivery of securities /
units to any one of you discharges our obligations to all of you. Without
affecting our rights against any of you, we may compound or vary the obligations
of or grant time or other indulgence to any of you.
8.5
In these Conditions, the singular includes the plural and vice versa
unless the context otherwise requires.
8.6
These Conditions and each Confirmation constitute the entire agreement of
the parties with respect to its subject matter and supersede all oral
communication and prior writings with respect thereto. The provisions of any other written
agreements made between you and us shall apply in addition to these
Conditions.
8.7
If any term or condition or part thereof is invalid, all other terms and
conditions remain in full force and effect.
8.9
These Conditions and each transaction are governed by the laws of the
Hong Kong Special Administrative Region. The parties submit to the non-exclusive
jurisdiction of the
PART 6 -
RISK DISCLOSURE
STATEMENTS
RISK OF INVESTMENT
Investment involves risk, and the offering
document should be read for further details.
(Where past performance is quoted) the past
performance figures shown are not indicative of future
performance.
EQUITY-LINKED
DEPOSITS
The risk of loss in a deposit may be substantial in
certain circumstances. The interest which may become payable on a deposit is
generally higher than the interest on an ordinary time deposit. However, this
carries with it equity risk. You accept a legal obligation to take the
underlying shares at the pre-agreed Conversion Price instead of receiving the
principal of the deposit, if the price of the underlying shares falls below the
Conversion Price. You will therefore receive shares that have fallen in value.
You will lose the entire deposit if the underlying shares become worthless such
as in the case of a liquidation or dissolution. The amount of gain is limited to
the pre-determined Interest Rate no matter how high the price of the underlying
shares has increased when compared to the pre-agreed Conversion Price. Equity Linked
Deposits are not the same as, and should not be treated as a substitute for,
normal fixed time deposits.
CURRENCY-LINKED DEPOSITS
The net return on a deposit will depend on the market
conditions at the fixing time and at maturity. You must be prepared to risk any loss as
a result of depreciation in the value of the currency which may be paid to you.
You may suffer a loss instead of making a gain.
RISK OF SECURITIES TRADING
The prices of securities fluctuate,
sometimes dramatically. The price of a security may move up or
down, and may become valueless. It
is as likely that losses will be incurred rather than profit made as a
result of buying and selling securities.
RISK OF TRADING OPTIONS
The risk of loss in trading options is substantial. In
some circumstances, you may sustain losses in excess of your initial margin
funds. Where applicable, placing
contingent orders, such as "stop-loss" or "stop-limit" orders, will not
necessarily avoid loss. Market conditions may make it impossible to
execute such orders. You may be called upon at short notice to deposit
additional margin funds. If the required funds are not provided within the
prescribed time, your position may be liquidated. You will remain liable for any
resulting deficit in your account. You should therefore study and understand
options before you trade and carefully consider whether such trading is suitable
in the light of your own financial position and investment
objectives. If you trade options you should inform yourself of
exercise and expiration procedures and your rights and obligations upon exercise
or expiry.
RISK OF LEVERAGED FOREIGN EXCHANGE
TRADING
The risk of loss in leveraged foreign exchange trading
can be substantial. You may sustain losses in excess of your initial margin
funds. Where applicable placing contingent orders, such as "stop-loss" or
"stop-limit" orders, will not necessarily limit losses to the intended amounts.
Market conditions may make it impossible to execute such orders. You may be
called upon at short notice to deposit additional margin funds. If the required
funds are not provided within the prescribed time, your position may be
liquidated. You will remain liable for any resulting deficit in your account.
You should therefore carefully consider whether such trading is suitable in
light of your own financial position and investment
objectives.
RISK OF TRADING GROWTH
Growth Enterprise Market (GEM) stocks involve
a high investment risk. In particular, companies may list on GEM with neither a
track record of profitability nor any obligation to forecast future
profitability. GEM stocks may be
very volatile and illiquid.
You should make the decision to invest only
after due and careful consideration. The greater risk profile and other
characteristics of GEM mean that it is a market more suited to professional and
other sophisticated investors.
Current information on GEM stocks may only be
found on the internet website operated by The Stock Exchange of Hong Kong
Limited. GEM Companies are usually not required to issue paid announcements in
gazetted newspapers.
You should seek independent professional
advice if you are uncertain of or have not understood any aspect of this risk
disclosure statement or the nature and risks involved in trading of GEM
stocks.
RISK OF FUNDS AND UNIT
TRUSTS
Investment in funds or unit
trusts is different to placing moneys on deposit with a bank. The funds or unit trusts are not
deposits or other obligations of, or guaranteed by, our affiliates or us. The fund company or unit trust manager
is under no obligation to redeem shares in any fund or unit trust at the price
at which they were issued. Although
we may not charge a fee for providing services relating to funds or unit trusts,
we will normally be paid a commission or rebate by the fund or unit trust
manager for arranging transactions involving funds or unit
trusts.
Since some markets in which
some of the funds or unit trusts invest may be subject to a higher than usual
risk of political or economic instability, the assets of and income from such
funds or unit trusts may be affected unfavorably by fluctuations in currency
rates, exchange control and fiscal regulations and as a result, the shares of
these funds and unit trusts may be subject to substantial price volatility. Some markets may not be subject to
accounting, auditing and financial reporting standards and practices comparable
to those applicable in more advanced countries, and there may be less government
supervision, legal regulation and less well defined tax laws and procedures than
in countries with more advanced securities markets.
Certain funds or unit
trusts may invest in higher yielding securities rated lower than investment
grade. Below investment grade
securities such as, for example, high yield debt securities, may be considered
speculative and can include securities that are unrated or in default. As a result, investment in these funds
or unit trusts are accompanied by a higher degree of credit risk than is present
in investment in higher rated, lower yielding securities.
You should carefully
consider prior to investing in funds or unit trusts, (a) the possible tax
consequences, (b) the legal requirements and (c) any foreign exchange control
requirements which you might encounter under the laws of the countries of your
incorporation, citizenship, residence or domicile and which might be relevant to
the purchase, sale, subscription, holding, conversion or disposal of the shares
in funds or unit trusts.
The market for technology
or technology-related funds or unit trusts can be highly volatile and in many
cases their prices may reflect market speculation rather than the underlying
economic value of such funds or unit trusts.
Certain
capital guaranteed/capital preserved funds or unit trusts generally carry some
terms and conditions, and redemption of shares in the funds or unit trusts prior
to fulfilling all the terms and conditions specified in the offering documents
or prospectus will be subject to market fluctuations or a redemption fee. Capital guaranteed/capital preserved
funds or unit trusts are not guaranteed by us or our
affiliates.
RISK OF PROVIDING AN AUTHORITY TO REPLEDGE YOUR
SECURITIES COLLATERAL ETC.
There is risk if you provide us with an authority that
allows us to apply your securities or securities collateral pursuant to a
securities borrowing and lending agreement, repledge your securities collateral
for financial accommodation or deposit your securities collateral as collateral
for the discharge and satisfaction of our settlement obligations and
liabilities.
If your securities or securities collateral are received
or held by us in Hong Kong, the above arrangement is allowed only if you consent
in writing. Moreover, unless you
are a professional investor, your authority must specify the person for which it
is current and be limited to not more than 12 months. If you are a professional investor,
these restrictions do not apply.
Additionally, your authority may be deemed to be renewed
(i.e. without your written consent) if we issue you a reminder at least 14 days
prior to the expiry of the authority, and you do not object to such deemed
renewal before the expiry date of your then existing
authority.
You are not required by any law to sign these
authorities. But an authority may
be required by us, for example, to allow your securities or securities
collateral to be lent to or deposited as collateral with third parties. We should explain to you the purposes
for which one of these authorities is to be used.
If you sign one of these authorities and your securities
or securities collateral are lent to or deposited with third parties, those
third parties will have a lien or charge on your securities or securities
collateral. Although we are
responsible to you for securities or securities collateral lent or deposited
under your authority, a default by us could result in the loss of your
securities or securities collateral.
A cash account not involving securities borrowing and
lending is available from us. If
you do not require margin facilities or do not wish your securities or
securities collateral to be lent or pledged, do not sign the above authorities
and ask to open this type of cash account.
RISK OF YOUR ASSETS RECEIVED OR HELD OUTSIDE
Your assets received or held by us or our nominee
outside Hong Kong are subject to the applicable laws and regulations of the
relevant overseas jurisdiction which may be different from the Securities and
Futures Ordinance (Cap 571) and the rules made thereunder. Consequently, your
asset may not enjoy the same protection as that conferred on customer asset
received or held in
RISK OF PROVIDING AN AUTHORITY TO HOLD MAIL OR TO DIRECT MAIL TO
THIRD PARTIES
You
understand that if you provide
us with an authority to hold mail or to direct mail to third parties,
it is important for you to promptly collect in person all contract notes and
statements of your account and review them in detail to ensure that any
anomalies or mistakes can be detected in a timely fashion.
RISK OF TRADING NASDAQ-AMEX SECURITIES AT THE STOCK
EXCHANGE OF HONG KONG LIMITED
The securities under the Nasdaq-Amex Pilot Program (PP)
are aimed at sophisticated investors.
You should consult us and become familiarised with the PP before trading
in the PP securities. You should be
aware that the PP securities are not regulated as a primary or secondary listing
on the Main Board or the Growth Enterprise Market of The Stock Exchange of Hong
Kong Limited.
RISK OF CUSTODY
There may be risks in leaving securities / units in our
safekeeping. For example, if we are
holding your securities/ units and we become insolvent, you may experience
significant delay in recovering the securities/ units.
GENERAL
Transactions are "non transferable" and it may be
impossible for you to close out or liquidate them.
Any recommendation or information given by us to you are
for your reference only. Reliance on such recommendation or information is at
your own risk. We make no representations regarding the performance of your
investment.
You confirm to us that you have sufficient knowledge and
experience to be able to evaluate the merits and risks of entering into each
transaction, are acting in reliance solely upon your own judgment or upon
professional advice obtained independently of us as to those merits and risks
(including, where relevant, the tax and accounting treatment of each
transaction) and are not relying upon our views or advice.
We may have existing or future commercial or banking
relationships with the issuer of the underlying shares or its affiliates, and
will pursue actions which we deem appropriate to protect our interests, without
any obligation to disclose or account to you, and regardless of whether any such
action might adversely affect you.
You should not deal in a transaction unless you
understand the nature of the transaction you are entering into and the extent of
your exposure to risk. You should carefully consider whether the transaction is
suitable for you in the light of your circumstances and financial position. If you have any concerns about any
transaction you should consult your professional advisers.
[If there
is any discrepancy between the English and Chinese versions, the English version
shall prevail.]
Conditions
for Investment Fund Savings Plan
The following terms and conditions apply to CMB Wing Lung
Bank Ltd Investment Fund Savings Plan (Plan). Please read them carefully, particularly
Conditions 9, 13, 14 and 15 and risk disclosure statement at the
end.
In these Conditions, “we”, “us” and “our” refer to CMB Wing Lung Bank Ltd. “You” and “your” refer to the Applicant. The singular includes the plural and
vice versa unless the context otherwise requires. Terms used bear the meaning ascribed to
them in the Application Form.
To the extent applicable, the terms and conditions of
the Client Agreement (Funds) or (as the case may be) the Master Conditions
(Securities, Deposit Products, Options and Investment Funds) shall also apply to
the Plan as if all references to “this Agreement” in the Client Agreement
(Funds) or (as the case may be) “these Conditions” in the Master Conditions
(Securities, Deposit Products, Options and Investment Funds) referred to these
Conditions. In case of
inconsistency, these Conditions shall prevail.
1.
If you wish to establish
a monthly investment fund savings, plan, please apply in the form (Application Form) provided by us. You will, with our agreement, select the
unit trusts, mutual funds, collective investment schemes or other investments
(Funds) you wish to buy, and specify
the Monthly Contribution Amount you will pay for each Fund. Only those Funds notified by us from
time to time are available for your selection.
2.
Following our acceptance
of your application, you will pay the agreed Total Monthly Contribution Amount
to us on the agreed date in each calendar month (or, if it is not a business
day, on the next business day) (Contribution Date). The first payment will be due on the
first Contribution Date falling at least 2 business days (which is a day, except
Saturdays, on which banks in Hong Kong are generally open for business) after
the date of your application.
3.
We will use each Monthly
Contribution Amount actually received from you (after deducting all relevant
fees and expenses) towards buying on your behalf, the maximum number (rounded
downwards to the number of decimal places as prescribed by the relevant fund
manager from time to time) of units, shares or interests (units) of the agreed Fund (a) on the
1st business day after the Contribution Date or as soon as practicable
thereafter if your Settlement Account is maintained with us, or (b) on the 3rd
business day after the Contribution Date or as soon as practicable thereafter if
your Settlement Account is not maintained with us (Subscription Date). If we cannot buy units in any of the
agreed Funds after 3 consecutive business days for whatever reason, we will
cease to buy units in the relevant Fund(s) on your behalf, notify you and credit
any unused Monthly Contribution Amount(s) (without interest) to your Settlement
Account.
4.
In determining the price
payable by you, we may use the weighted average price of purchases of units in
the Funds under similar orders of all our customers.
5.
If any purchased units
are less than the total requirements of similar orders of all our customers, we
may allocate them in a fair manner.
6.
Units purchased on
behalf of all our customers will be held in the account of our nominee, Wing
Lung Bank (Nominees) Ltd., and units purchased on your behalf will be recorded
in your Fund Account.
7.
If the amount actually
received from you on the Contribution Date is less than the Total Monthly
Contribution Amount, unless otherwise agreed with you before the Subscription
Date, we may make no purchase and refund the moneys (without interest) to your
Settlement Account.
8.
Payments to be made for
the purchase of units in a currency other than that of the agreed Funds may be
converted by us into the applicable currency at the rates and times selected by
us. We may refuse to accept any
payment in a currency other than that of the agreed Funds at any time. Payments to be received by us on your
behalf in respect of the Funds from time to time in a currency other than that
of your Settlement Account may be converted by us into the applicable currency
at the rates and times selected by us.
We may deduct all fees and expenses for the conversion from each such
payment.
9.
You acknowledge receipt
of a list of our fees and charges.
We may change our fees and charges from time to time after notice to
you. You will pay our fees and
charges, and all out-of-pocket expenses including sums payable in respect of
your units, overdraft interest arising from your transactions, the expenses of
our sub-custodians and nominees, applicable fees of any exchange, clearing
house, registrar and regulatory authority, and applicable stamp duties, taxes
and expenses. You will pay in the
amounts and within the times notified to you. We may deduct all such amounts from your
accounts with us.
10.
Your plan is subject to
change by us, and may be changed by you with our agreement. If you wish to change any details of your
plan, please apply in the form provided by us. An agreed change of your Settlement
Account to an account maintained with a third party bank will become effective
as from the first Contribution Date falling at least 2 months later. Any other agreed change will become
effective as from the first Contribution Date falling at least 2 business days
later.
11.
You may terminate your
plan at any time after notice to us and, if we require, paying us a
surcharge. If you wish to terminate
your plan, please apply in the form provided by us. We may terminate your plan by 7 days’
prior notice to you. However, if
you fail to pay the Total Monthly Contribution Amount in full on 2 consecutive
Contribution Dates, we may terminate your plan without notice and a surcharge
may be levied by us.
12.
You may not transfer,
assign, mortgage or charge your units or transactions or your Fund Account or
these Conditions without our prior written consent. Subject to the foregoing, these
Conditions will bind and inure to the benefit of the parties and their
respective estates, heirs, successors and assigns.
13.
We will not be liable
for any event beyond our control, or unless due to our gross negligence or fraud
for any act or omission under these Conditions.
14.
Any recommendation or
information given by us to you are for your reference only. Reliance on such recommendation or
information is at your own risk.
The actual price of a particular Fund is determined by the relevant fund
manager, and any quotations provided by us are only indicative. We make no representations regarding the
performance of your investment.
15.
You will indemnify us
against any liabilities, losses or expenses arising out of our service or any
breach of your obligations.
16.
If you are 2 or more
persons, your obligations are joint and several, and your powers are joint. We may notify you by notifying any one
of you. We may accept instructions
from, give receipts to and for all purposes deal with any one of you unless we
have received written instructions to the contrary. Our payment or delivery of units to any
one of you discharges our obligations to all of you. Without affecting our rights against any
of you, we may compound or vary the obligations of or grant time or other
indulgence to any of you.
17.
If any provision or part
thereof is invalid, all other provisions remain in full force and
effect.
18.
These Conditions are
governed by the laws of the Hong Kong Special Administrative Region. The parties submit to the non-exclusive
jurisdiction of the
Risk Disclosure Statement
Investment involves risk, and the offering document
should be read for further details.
(Where past performance is quoted) the past performance figures shown are
not indicative of future performance.
[If there
is any discrepancy between the English and Chinese versions, the English version
shall prevail.]