SCHEDULE to the March 1, 2007 Master Agreement dated as of [trade date of first transaction / signature date if no transaction] between
Exhibit
10.10
SCHEDULE
to
the
March 1,
2007 Master Agreement
dated
as of [trade date of first transaction / signature date if no
transaction]
between
|
UBS
AG
|
and
|
UBS
Managed Futures (Aspect) LLC
|
|
(“Party
A”)
|
(“Party
B”)
|
Part 1
Termination
Provisions
(a) “Specified
Entity” means:
(i) for
Party A for the purpose of:
Section 5(a)(v)
of this
Agreement, UBS
Securities LLC and UBS Limited,
Section 5(a)(vi)
of this
Agreement, none,
Section 5(a)(vii)
of this
Agreement, none,
Section 5(b)(iv)
of this
Agreement none;
and
(ii) for
Party B for the purpose of:
Section 5(a)(v)
of this
Agreement, the
Investment Adviser of Party B,
Section 5(a)(vi)
of this
Agreement, the
Investment Adviser of Party B,
Section 5(a)(vii)
of this
Agreement, the
Investment Adviser of Party B,
Section 5(b)(iv)
of this
Agreement none.
|
(b)
|
“Specified
Transaction” has the meaning specified in
Section 14 of this Agreement and also means repurchase agreements,
reverse repurchase agreements, securities lending agreements, forward
contracts, precious metals transactions, letters of credit reimbursement
obligations, indebtedness for borrowed money (whether or not evidenced by
a note or similar instrument) and any amounts payable under exchange
traded derivative agreements between one party to this Agreement (or any
Credit Support Provider or applicable Specified Entity of that party) and
the other party to this Agreement (or any Credit Support Provider or
applicable Specified Entity of that other
party).
|
|
(c)
|
The
“Cross
Default”
provisions of Section 5(a)(vi) of this Agreement apply to
Party A and to Party B with the addition of the following at the
end:
|
“however,
an Event of Default does not occur under either (1) or (2) above if such
party demonstrates to the reasonable satisfaction of the other that (a) the
event or condition referred to in (1) or the failure to pay referred to in
(2) is, or is due to, a failure to pay caused by an error or omission of an
administrative or operational nature; (b) funds were available to such
party to enable it to make the relevant payment when due; and (c) the
relevant payment is made within three Local Business Days following receipt of
written notice from an interested party of the failure to pay.”
“Specified
Indebtedness” means any obligation (whether present or future, contingent
or otherwise as principal or surety or otherwise) for the payment or repayment
of any money.
19
“Threshold
Amount” means:
|
(i)
|
for
Party A: an amount equal to 2% of shareholders’ equity (however
described) of Party A as shown on the most recent annual audited financial
statements of Party A; and
|
|
(ii)
|
for
Party B, or any Credit Support Provider or Specified Entity of Party
B: the lesser of USD 10,000,000 (or the equivalent in other
currencies) and an amount equal to 2% of Net Asset Value (as defined in
Part 5 below) of Party B.
|
|
(d)
|
The
“Credit
Event Upon Merger” provisions of Section 5(b)(iv) of this
Agreement will apply to Party A and Party
B.
|
|
(e)
|
The
“Automatic
Early Termination” provision of Section 6(a) of this Agreement
applies to Party A and does/does not apply to Party
B.
|
|
(f)
|
Payments on
Early Termination for the purpose of Section 6(e) of this
Agreement: (i) Loss applies; and (ii) the Second
Method applies.
|
|
(g)
|
“Termination
Currency” means a currency
in which payments are required to be made under a Confirmation for a
Terminated Transaction, that is selected by the Non-defaulting Party or
non-Affected Party, or, if there are two Affected Parties, as agreed
between the parties or, failing agreement or if the currency selected is
not freely available, the Termination Currency is U.S.
Dollars.
|
|
(h)
|
Additional
Termination Event. The following are Additional
Termination Events for which Party B is the Affected
Parry:
|
|
(A)
|
Decline in
Net Asset Value. Party B’s Net Asset Value (as at the
last day of any calendar month (such date, “X”)) declines by (i) 15%
or greater within one calendar month of X, or (ii) 30% or greater
within 3 calendar months of X or (iii) 40% or greater within 12
calendar months of X;
|
|
(B)
|
Minimum Partnership
Capital/Net Asset Value. The Partnership
Capital/Net Asset Value of Party B is equal to or less than (i) 50%
of Party B’s Partnership Capital/Net Asset Value as of the signing of this
agreement or (ii) 50% of Party B’s Partnership Capital/Net Asset
Value as of the 31st
December of the previous calendar
year;
|
|
(C)
|
Change of
Adviser. Aspect Capital Limited
(the “Investment Adviser”) ceases to be the investment adviser to
Party B;
|
|
(D)
|
Change in
Management. Either ▇▇▇▇▇▇▇ ▇▇▇▇ or ▇▇▇▇▇▇▇ ▇▇▇▇ ceases
to be actively involved in and responsible for the management of the
assets of Party B (as reasonably determined by
Party A);
|
|
(E)
|
Failure to
Deliver Net Asset Value Statement. Party B fails to
deliver a statement of its Net Asset Value or its monthly investment
report on or before the third Local Business Day of Party A notifying
Party B (whether in writing or orally) of Party B’s failure to provide the
report on the required delivery date specified in Part 3 of this
Schedule; and
|
|
(F)
|
Change in Regulatory Status. The Investment
Adviser ceases to be regulated by a recognized regulatory body in a FATF
(Financial Action Task Force)
country.
|
20
Part 2
Tax Representations
|
(a)
|
Payer Tax
Representations. For the purpose of Section 3(e) of
this Agreement, Party A and Party B each make the following
representation:
|
It is not
required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, of any Relevant Jurisdiction to make any
deduction or withholding for or on account of any Tax from any payment (other
than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to be
made by it to the other party under this Agreement. In making this
representation, it may rely on (i) the accuracy of any representations made
by the other party pursuant to Section 3(f) of this Agreement,
(ii) the satisfaction of the agreement contained in Section 4(a)(i) or
4(a)(iii) of this Agreement and the accuracy and effectiveness of any document
provided by the other party pursuant to Section 4(a)(i) or 4(a)(iii) of
this Agreement and (iii) the satisfaction of the agreement of the other
party contained in Section 4(d) of this Agreement, PROVIDED THAT it is not a
breach of this representation where reliance is placed on sub-clause (ii)
above and the other party does not deliver a form or document under
Section 4(a)(iii) by reason of material prejudice to its legal or
commercial position.
|
(b)
|
Payee Tax
Representations. For the purpose of Section 3(f) of
this Agreement, Party A and Party B make no
representations.
|
21
Part 3
Agreement
to Deliver Documents
For the
purposes of Sections 3(d), 4(a)(i) and (ii) of this Agreement, each
party agrees to supply the following documents:
|
PARTY
REQUIRED
|
FORM/DOCUMENT/
|
DATE
BY WHICH
|
COVERED
BY SECTION
|
|
TO
DELIVER DOCUMENT:
|
CERTIFICATE:
|
TO
BE DELIVERED:
|
3(d)
REPRESENTATION:
|
|
Party
A and Party B
|
Evidence
of the authority
|
On
or before execution of
|
Yes
|
|
and
true signatures of each
|
this
Agreement and each
|
||
|
official
or representative
|
Confirmation
forming a part
|
||
|
signing
this Agreement or
|
of
this Agreement.
|
||
|
Confirmation
on its behalf.
|
|||
|
Party
B
|
Opinion
of Party B’s legal
|
On
or before execution of
|
Yes
|
|
counsel
in a form
|
this
Agreement.
|
||
|
satisfactory
to Party A
|
|||
|
regarding
(inter alia) the
|
|||
|
power
and authority of Party
|
|||
|
B
to enter into this
|
|||
|
Agreement
and
|
|||
|
Transactions
hereunder.
|
|||
|
Party
B
|
Evidence
reasonably
|
On
or before execution of
|
Yes
|
|
satisfactory
to Party A
|
this
Agreement.
|
||
|
authorising
Party B’s
|
|||
|
execution
of this Agreement
|
|||
|
and
each Confirmation and
|
|||
|
performance
of Party B’s
|
|||
|
obligations.
|
|||
|
Party
B
|
Annual
Audited
|
As
soon as practicable but
|
Yes
|
|
Financial
Statements
|
in
any event within 90
|
||
|
days
of the end of each
|
|||
|
financial
year
|
|||
|
Party
B
|
Copy
of the monthly
|
Within
15 days of the last
|
Yes
|
|
investment
report
|
Local
Business Day in
|
||
|
prepared
by the
|
each
calendar month
|
||
|
investment
adviser and
|
|||
|
sent
to investors, to
|
|||
|
include
NAV information,
|
|||
|
performance
|
|||
|
commentary/attribution,
|
|||
|
and
summary portfolio
|
|||
|
information
|
|||
|
Party
B
|
Confirmation
of the NAV
|
Within
15 days of the last
|
Yes
|
|
and
NAV per share of Party
|
Local
Business Day in
|
22
|
B
to be provided directly
|
each
calendar month
|
||
|
from
Party B’s Administrator
|
|||
|
Party
B
|
Any
other information which
|
Upon
request of Party A
|
Yes
|
|
Party
A may reasonably
|
|||
|
request
from Party B from
|
|||
|
time
to time
|
|||
|
Party
B
|
Letter
of Process Agent of
|
On
or before execution of
|
Yes
|
|
Party
B confirming
|
this
Agreement.
|
||
|
acceptance
of appointment.
|
|||
|
Party
B
|
Certified
copy of the
|
On
or before execution of
|
Yes
|
|
resolution
of Party B’s
|
this
Agreement.
|
||
|
Board
of Directors (or
|
|||
|
equivalent
authorising
|
|||
|
documentation)
authorising
|
|||
|
the
execution and delivery
|
|||
|
of
this Agreement and each
|
|||
|
Confirmation
and
|
|||
|
performance
of its
|
|||
|
obligations
hereunder.
|
23
Part 4
Miscellaneous
|
(a)
|
Address for
Notices. For the purpose of Section 12(a) of this
Agreement:
|
Address for notices or communications
to Party A:
For a
particular Transaction, the address, telex number or facsimile number specified
in the Confirmation and for any other notice the address specified
below:
Address: ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Attention: Credit
Risk Management - Documentation Unit / Legal Department
Facsimile
no: ▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇ / ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇
Telephone
no: ▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇
Address
for notices or communications to Party B:
Address: PLEASE
ADVISE
Attention:
Telex: Answerback:
Facsimile: Telephone:
Electronic Messaging Details:
Attention:
Telex: Answerback:
Facsimile: Telephone:
Electronic Messaging Details:
|
(b)
|
Process
Agent. For the purpose of Section 13(c) of this
Agreement: For Party A: not
applicable. For Party B: [please state the name and
permanent address (in England and Wales) of the process agent that you
have appointed to receive court papers as your agent in the event of legal
proceedings in England.]
|
|
(c)
|
Offices. The provisions of
Section 10(a) of this Agreement apply to Party A and Party
B.
|
|
(d)
|
Multibranch
Party. For the purpose of
Section 10(c) of this
Agreement:
|
Party A
is a Multibranch Party and may act through its branches in any of the following
territories or countries: England and Wales, Australia, Hong Kong,
United States of America, Singapore, and Switzerland. Party B is not
a Multibranch Party.
|
(e)
|
Calculation Agent. The Calculation Agent is
Party A, unless otherwise specified in the Confirmation for the relevant
Transaction.
|
|
(f)
|
Credit
Support Document. Details of any Credit
Support Document for Party A and Party B: not
applicable.
|
|
(g)
|
Credit
Support Provider. Credit Support Provider
means for Party A and Party B, not
applicable.
|
|
(h)
|
Governing
Law. This
Agreement is governed by and must be construed in accordance with English
law.
|
|
(i)
|
Netting of
Payments. Subparagraph (ii) of
Section 2(c) of this Agreement applies except for FX and Currency
Option Transactions and energy commodity transactions where subparagraph
(ii) of Section 2(c) does not apply. Payments in FX
and Currency Option Transactions are netted with payments in other FX and
Currency Option Transactions in the same currency but not with
Transactions other than FX and Currency Option
Transactions. Payments in energy commodity transactions are
netted with other payments in energy commodity transactions in the same
currency but not with Transactions other than energy commodity
transactions.
|
24
|
(j)
|
“Affiliate” has
the meaning specified in Section 14 of this
Agreement.
|
25
Part 5
Other
Provisions
|
(a)
|
Set-off. Without
affecting the provisions of the Agreement requiring the calculation of
certain net payment amounts, all payments under this Agreement will be
made without set-off or counterclaim; provided, however, that upon the
designation of an Early Termination Date following an Event of Default, or
a Termination Event under Section 5(b)(iv) or Section 5(b)(v),
in addition to and not in limitation of any other right or remedy
(including any right to set off, counterclaim, or otherwise withhold
payment or any recourse to any Credit Support Document) under applicable
law the Non-defaulting Party or non-Affected Party (in either case, “X”)
may without prior notice to any person set off any sum or obligation
(whether or not arising under this Agreement and whether matured or
unmatured, whether or not contingent and irrespective of the currency,
place of payment or booking office of the sum or obligation) owed by the
Defaulting Party or Affected Party (in either case, “Y”) to X or any
Affiliate of X against any sum or obligation (whether or not arising
under this Agreement, whether matured or unmatured, whether or not
contingent and irrespective of the currency, place of payment or booking
office of the sum or obligation) owed by X or any Affiliate of X
to Y and, for this purpose, may convert one currency into another at a
market rate determined by X. If any sum or obligation is
unascertained, X may in good faith estimate that sum or obligation
and set-off in respect of that estimate, subject to X or Y, as the
case may be, accounting to the other party when such sum or obligation is
ascertained. Nothing in this Agreement shall create or be
deemed to create any charge under English
law.
|
|
(b)
|
Representations. Section 3(a)
of this Agreement is hereby amended by the deletion of “and” at the end of
Section 3(a)(iv); the substitution of the word “; and” for the full
stop at the end of Section 3(a)(v) and the addition of
Section 3(a)(vi) as follows:
|
|
|
“(vi)
|
No
Agency. It is entering into this Agreement and each
Transaction as principal (and not as agent
or in any other capacity, fiduciary or
otherwise).”
|
|
(c)
|
Waiver
Of Jury Trial. Each
party waives, to the fullest extent permitted by law, any right it may
have to a trial by jury in respect of any suit, action or proceeding
relating to this agreement or any credit support document or any
transaction. Each party (i) certifies that no
representative, agent or attorney of the other party or any credit support
provider has represented, expressly or otherwise, that the other party
would not seek to enforce this waiver in the event of any such suit,
action or proceeding and (ii) acknowledges that it and the other
party have entered into this agreement and any credit support document, as
applicable, in reliance on, among other things, the mutual waivers and
certifications in this section.
|
|
(d)
|
Consent to
Recording. Each Party (i) consents to the recording
of all telephone conversations between trading, operations and marketing
personnel of the parties and their Affiliates in connection with this
Agreement or any potential Transaction; (ii) agrees to give notice to
such personnel of it and its Affiliates that their calls will be recorded;
and (iii) agrees that in any Proceedings, it will not object to the
introduction of such recordings in evidence on the ground that consent was
not properly given.
|
|
(e)
|
Scope of
Agreement. Upon the effectiveness of this Agreement and
unless the parties to this Agreement otherwise agree in writing, by
specific reference to this Agreement, that this provision does not apply,
all Derivative Transactions (as defined below) then outstanding, or which
may be entered into thereafter, between the parties, including
Transactions entered into by the parties through Offices, if any, listed
in Part 4(d), are deemed to be Transactions governed by this
Agreement and any confirmation or other confirming evidence of the
Transaction is deemed to be a
Confirmation.
|
‘Derivative
Transaction’ means any transaction (including an agreement with respect thereto)
which is a rate swap transaction, swap option, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap,
equity or equity index option, bond option, interest rate option, foreign
exchange transaction,
26
cap
transaction, floor transaction, collar transaction, currency swap transaction,
cross-currency rate swap transaction, currency option, credit protection
transaction, credit swap, credit default swap, credit default option, total
return swap, credit spread transaction, weather index transaction,
bullion/precious metal transaction, base meta’ transaction, or forward purchase
or sale of a security, commodity or other financial instrument or interest, or
any other similar transaction (including any option with respect to any of these
transactions) and any combination of these transactions.
ISDA Definitions. (i) The provisions of the 1998 FX
and Currency Option Definitions (as published by the International Swaps and
Derivatives Association, Inc., the Emerging Markets Traders Association and the
Foreign Exchange Committee) (the “1998 FX Definitions”) are hereby incorporated
in their entirety and shall apply to any FX Transaction or Currency Option
Transaction as defined in Section 1.12 and Section 1.5, respectively,
of Article 1 of the 1998 FX Definitions (each an “FX Transaction” or
“Currency Option Transaction”, respectively) entered into by the parties hereto
(unless, in relation to a particular FX Transaction or Currency Option
Transaction, as otherwise specified in the relevant Confirmation) ;
and
(ii) The
provisions of the 2005 ISDA Commodity Definitions (as published by the
International Swaps and Derivatives Association, Inc.) (the “Commodity
Definitions”) are hereby incorporated in their entirety and shall apply to any
Transaction as defined in Section 1.1 of Article 1 of the Commodity
Definitions (each a “Commodity Transaction”) entered into by the parties hereto
(unless, in relation to a particular Commodity Transaction, as otherwise
specified in the relevant Confirmation) .
(f) Relationship
between the Parties. This Agreement is amended by the addition
of Section 15 as follows:
“15. Relationship between the
Parties.
Each
party is deemed to represent to the other party on the date on which it enters
into a Transaction (absent a written agreement between the parties that
expressly imposes affirmative obligations to the contrary for that
Transaction):
|
(a)
|
Non
Reliance. It is acting for its own account, and it has
made its own independent decisions to enter into that transaction and as
to whether that Transaction is appropriate or proper for it based upon its
own judgement and upon advice from such advisers as it has deemed
necessary. It is not relying on any communication (written or
oral) of the other party as investment advice or as a recommendation to
enter into that Transaction; it being understood that information and
explanations related to the terms and conditions of a Transaction shall
not be considered investment advice or a recommendation to enter into that
Transaction. No communication (written or oral) received from
the other party shall be deemed to be an assurance or guarantee as to the
expected results of that
Transaction.
|
|
(b)
|
Assessment
and Understanding. It is capable of assessing the merits
of and understanding (on its own behalf or through independent
professional advice), and understands and accepts, the terms, conditions
and risks of that Transaction. It is also capable of assuming,
and assumes, the risks of that
Transaction.
|
|
(c)
|
Status of
Parties. The other party is not acting as a fiduciary
for or an adviser to it in respect of that
Transaction.”
|
References
in this clause to a “party”, for UBS AG and where the context allows,
includes any Affiliate of UBS AG.
|
(g)
|
Prior
Agreements. This
Agreement supersedes all Agreements between the parties entered into prior
to the execution of this Agreement governing any Specified Transaction
between the parties and all confirmations
for
|
27
those
Specified Transactions supplement, form part of, and are subject to this
Agreement, such confirmations are Confirmations and such Specified Transactions
are Transactions. For the purposes of this provision the definition
of Specified Transaction is as defined in Section 14 of the Master
Agreement, amended by the deletion of the words “, subject to the schedule,”
from the first line and “this Agreement or” from the final line.
(h) Agreements. Section 4
of this Agreement is amended by the addition of Section 4(f) as
follows:
|
"(f)
|
Physical
Delivery. In respect of any physically settled
Transactions, it will, at the time of delivery, be the legal and
beneficial owner, free of liens and other encumbrances, of any securities
or commodities it delivers to the other party; and, in addition, with
respect to any breach of this Section 4(f), Section 5(a)(ii) of
this Agreement is amended by the insertion of a full stop after
“Agreement” on the fifth line and the deletion of the remainder of the
Section.”
|
(i) Failure to Pay or
Deliver. For Party B only, Section 5(a)(i) is deleted in
its entirety and replaced by:
|
(i)
|
Failure to Pay or
Deliver. Failure by Party B to make, when due, any
payment under this Agreement or any delivery under Section 2(a)(i) or
2(e) required to be made by
it.”
|
|
(j)
|
Further Representation of
Party B. In
addition to its representations under Section 3, Party B represents
to Party A (which representations are deemed to be repeated by Party B on
each date on which any Transaction exists)
that:
|
|
(i)
|
It
has appointed the Investment Adviser to act as its agent for all purposes
under this Agreement (including, without limitation, for the purpose of
entering into Transactions on its behalf) (each such Transaction an
“Agency Transaction”); and
|
|
(ii)
|
Any
person (including, without limitation, the Investment Adviser and any
person representing or purporting to represent the Investment Adviser)
signing the Agreement or any Confirmation, and any such person entering
into any Transaction, is authorised to do so on behalf of Party
B.
|
|
(k)
|
Further
Agreements of Party B. In addition
to its agreements under Section 4, Party B agrees with Party A that,
so long as either party has or may have any obligations under this
Agreement:
|
|
(i)
|
Any
amounts payable by Party A under this Agreement are deemed satisfied when
paid to an account as instructed by the Investment
Adviser.
|
|
(ii)
|
Party
B is bound as principal of any Agency Transaction entered into by the
Investment Adviser or any other person representing or purporting to
represent the Investment Adviser, despite any lack of power or authority
on the part of the Investment Adviser or such other
person.
|
|
(l)
|
Reliance on
Notices. Except as otherwise stated herein, each
party may rely upon any oral or written notices and instructions
reasonably believed to be originated from the other party or its duly
authorised agent (including, for Party B, the Investment Adviser) and does
not incur any liability to the other party in acting in accordance with
those notices and instructions.
|
|
(m)
|
Termination
Notice. Section 6(b)(i) of this Agreement is
modified by the addition of the words “and in any
event within one Local Business Day,” after the words “promptly upon
becoming aware of it,” in the first and second lines
thereof.
|
|
(n)
|
Definitions. Section 14
is amended to include the following definition in its appropriate
alphabetical position:
|
28
‘Net Asset Value’ or
‘NAV’
means the result in U.S. Dollars of subtracting the total value of all
liabilities (including but not limited to the aggregate ▇▇▇▇-to-market value of
all trading positions constituting liabilities) from the total value of all
assets (including but not limited to cash, deposit accounts and instruments,
securities, and the aggregate ▇▇▇▇-to-market value of all trading positions
constituting assets). For purposes of this computation, amounts
denominated in a currency other than U.S. Dollars are converted to U.S. Dollars
at the then-prevailing spot rate.
|
(o)
|
Break clause for
Transactions. Party A may, by giving 3 Local
Business Days’ notice to Party B, designate an Early Termination Date for
any Transaction on each anniversary of the trade date of that Transaction,
in which case the Transaction is Cash-Settled under Section 17 of the
ISDA 2000 Definitions, using Cash Price Settlement Method and Quotation
Rate of Mid.
|
(p) Indian
transactions
For any
Transaction that references a share listed on a stock exchange in India, Party A
and Party B:
|
(1)
|
consent
to the other party providing any Indian government or regulatory authority
with any information regarding it and the Transaction as required under
Indian regulations or as requested by any Indian government or regulatory
authority;
|
|
(2)
|
agree
to provide to the other party any additional information that the other
party considers necessary or appropriate in order for that other party to
comply with any such regulations or
requests;
|
|
(3)
|
represent
to the other that the Transaction is not being entered into for the
benefit or account of, or pursuant to or in connection with any
back-to-back transaction with: (i) a Person Resident in
India as the term is used in the Foreign Exchange Management Act, 1999
(the “Act”), or , (ii) a “Non-Resident Indian”, a “Person of Indian
Origin” or an “Overseas Corporate Body”, as those terms are used in the
Foreign Exchange Management (Deposit) Regulations 2000 as notified by the
Reserve Bank of India or (iii) any entity or person that is not
regulated (as that term is used in the Securities and Exchange Board of
India (Foreign Institutional Investors Amendment) Regulations, 2004)
(each, a “Restricted Entity”);
|
|
(4)
|
represent
to the other that it is not a Restricted Entity;
and
|
|
(5)
|
agree
not to, directly or indirectly, sell, transfer, assign, novate or
otherwise dispose of the Transaction to or for the benefit or account of
any Restricted Entity.
|
(q) Taiwanese
transactions
For any
Transaction that references a share listed on a stock exchange in Taiwan, Party
A and Party B each represent to the other that:
|
(1)
|
it
is not entering into the Transaction for the benefit or account of, or
pursuant to or in connection with any back-to back transaction with
(A) any residents of the People’s Republic of China (“PRC”),
corporations in the PRC, or corporations outside the PRC that are
beneficially owned by residents of the PRC or (B) any residents of
the Republic of China (“Taiwan”), corporations in Taiwan, or corporations
outside Taiwan that are beneficially owned by residents of
Taiwan.
|
|
(2)
|
it
will not, directly or indirectly, sell, transfer, assign, novate or
otherwise dispose of the Transaction to or for the benefit or account
(i) any residents of the PRC, corporations
in
|
29
the PRC,
or corporations outside the PRC that are beneficially owned by residents of the
PRC or (ii) any residents of Taiwan, corporations in Taiwan, or
corporations outside Taiwan that are beneficially owned by residents of
Taiwan.
|
(3)
|
details
of the Transaction (including the identity of the parties) may,
(1) upon request or order by any competent authority, regulatory or
enforcement organisation, governmental or otherwise, including the stock
exchange on which the underlying shares are listed, (2) as required
by applicable law, rules, regulations, codes or guidelines (whether having
the force of law or otherwise), be disclosed in accordance with such
request, order, law, rules, regulations, codes or guidelines (whether such
disclosure is to be made to third parties or otherwise). By
entering into the Transaction, each party agrees to such disclosure and
releases the other (and its subsidiaries and affiliates) from any duty of
confidentiality owed to it in relation to such
information.
|
(r) Chinese
transactions
For any
Transaction that references a share listed on a stock exchange in People’s
Republic of China (“PRC”), Party A and Party B each represent to the other
that:
|
(1)
|
it
is not entering into the Transaction for the benefit or account of, or
pursuant to or in connection with any back-to back transaction with any
Domestic Investor or any person for the account of any Domestic
Investor.
|
|
(2)
|
it
will not, directly or indirectly, sell, transfer, assign, novate or
otherwise dispose of the Transaction, directly or indirectly, to any
Domestic Investor or any person for the account of any Domestic
Investor.
|
|
(3)
|
details
of the Transaction (including identity of the parties) may (a) upon
request or order by any competent authority, regulatory or enforcement
organisation, governmental or otherwise, including without limitation, the
Securities and Futures Bureau of the Financial Supervisory Commission of
the Republic of China, and including the stock exchange on which the
underlying shares are listed, (b) as required by applicable law,
rules, regulations, codes or guidelines (whether having the force of law
or otherwise), be disclosed in accordance with such request, order, law,
rules, regulations, codes or guidelines (whether such disclosure is to be
made to third parties or otherwise). By entering into the
Transaction, each party agrees to such disclosure and releases the other
(and its subsidiaries and affiliates) from any duty of confidentiality
regarding such disclosure.
|
“Domestic Investor” is defined in the
Administrative Rules of Securities Accounts of China Securities Depository and
Clearing Corporation Limited and includes the following:
|
(i)
|
PRC
citizens resident in the PRC (excluding Hong Kong, Macau and
Taiwan);
|
|
(ii)
|
PRC
citizens resident outside the PRC who are not permanent residents of
another country or permanent residents of Hong Kong, Macau or
Taiwan;
|
|
(iii)
|
Legal
persons registered in the PRC (excluding Hong Kong, Macau and
Taiwan).
|
“PRC
citizens” used in the rules do not include persons who are
permanent residents of Hong Kong, Macau or Taiwan.
“Legal persons
registered in the PRC” excludes foreign entities incorporated or
organised in other jurisdictions even though they may have an office (i.e. a
branch) in the PRC.
30
31
Paragraph
11. Elections and
Variables
(a) Base Currency and Eligible
Currency.
(i) “Base
Currency” means United States Dollars.
(ii) “Eligible
Currency” means the Base Currency,
(b)
Credit
Support Obligations.
(i)
Delivery Amount, Return Amount
and Credit Support Amount.
(A) “Delivery Amount” has the meaning
specified in Paragraph 2(a).
(B) “Return Amount”
has the meaning specified in paragraph 2(b).
(C) “Credit Support
Amount” has the meaning specified in Paragraph 10
|
(ii)
|
Eligible
Credit Support.
|
The
following items will qualify as “Eligible
Credit Support”
for the party
specified:
|
|
Party
A
|
Party
B
|
Valuation
Percentage
|
|
|
(A)
cash in an Eligible Currency
|
N/A
|
YES
|
100%
|
|
(B)
negotiable debt obligations having a residual maturity of not more than
one year issued by any of the following governments:
- United States of America (US Treasury Department issues only) - Germany - France |
N/A
|
YES
|
98%
|
|
(C)
negotiable debt obligations having a residual maturity of more than one
year but less than or equal to 5 years issued by any of the following
governments:
- United States of America (US Treasury Department issues only) - Germany - France |
N/A
|
YES
|
96%
|
|
(D)
negotiable debt obligations having a residual maturity of more than 5
years but less than or equal to 10 years issued by any of the following
governments:
- United States of America (US Treasury Department issues only) |
N/A
|
YES
|
94%
|
11
|
-
Germany - France
|
|
|
|
In the
case of (B) to (D) only is so far as they are denominated in the
domestic currency of the country or Euro in the case of Euro member
countries,
(iii) Thresholds.
|
(A)
|
“Independent
Amount” means with respect to Party A: Zero
“Independent
Amount” means with respect to Party B: an amount agreed
between the parties at the time of
trading.
|
|
(B)
|
“Threshold” means with
respect to Party A: Infinity
“Threshold”
means with respect to Party
B: zero
|
provided
however that if an Event of Default has occurred and is continuing with respect
to such party, such party’s Threshold shall be zero.
|
(C)
|
“Minimum
Transfer
Amount” means with respect to Party A: USD
500,000
“Minimum
Transfer Amount” means with respect to Party B: USD
50,000.
|
provided
however that if an Event of Default has occurred and is continuing with respect
to such party, such party’s Minimum Transfer Amount shall be zero.
|
(D)
|
Rounding. The
Delivery Amount and the Return Amount will be rounded up and down
respectively to the nearest integral multiple of USD
50,000.
|
(c) Valuation and Timing.
|
|
(i)
|
“Valuation
Agent” means, Party A, acting in good faith and a commercially
reasonable manner.
|
|
|
(ii)
|
“Valuation
Date” means any
Local Business Day.
|
|
|
(iii)
|
“Valuation
Time” means the close of business in the Relevant Market on the
Local Business Day first preceding the Valuation Date or date of
calculation, as applicable.
|
For the
purposes of this provision, “Relevant Market” means
|
(a)
|
with
respect to the calculation of Value, the principal market in which the
relevant Eligible Credit Support is traded;
and
|
|
(b)
|
with
respect to the calculation of Exposure, the location most closely
associated with the relevant
Transaction;
|
12
each as
determined by the Valuation Agent , or as otherwise agreed between the
parties.
(iv) “Notification
Time” means 1:00 p.m., London time, on the Local Business
Day.
(d) Exchange
Date. “Exchange Date” has the meaning specified in Paragraph
3(c)(ii).
(e) Dispute Resolution.
|
(i)
|
“Resolution
Time” means 1:00 p.m., London time, on the Local Business Day
following the date on which the notice is given that gives rise to a
dispute under Paragraph 4.
|
|
(ii)
|
Value. For
the purpose of Paragraphs 4(a)(4)(i)(C) and 4(a)(4)(ii), the Value of
the outstanding Credit Support Balance or of any transfer of Eligible
Credit Support or Equivalent Credit Support, as the case may be, will be
calculated as follows: disputes over value will be resolved by
the Valuation Agent seeking three bid quotes as of the relevant Valuation
Date or date of Transfer from parties that regularly act as dealers in the
securities or other property in question. The Value will be the
mean of the Base Currency Equivalent of the arithmetic mean of the bid
prices obtained by the Valuation Agent multiplied by the nominal amount of
such security, plus any income which, as of such date, has accrued but not
yet been paid in respect of the security to the extent not included in
such price as of such date, multiplied by the applicable Valuation
Percentage.
|
|
(iii)
|
Alternative. The
provisions of Paragraph 4 will
apply.
|
(f) Distributions and Interest
Amount.
|
(i)
|
Interest
Rate. The
“Interest Rate” in relation to each Eligible Currency specified below will
be:
|
Eligible
Currency Interest
Rate
|
|
US
DOLLARS
|
Fed
Funds as quoted on Telerate
page 118
|
|
(ii)
|
Transfer of
Interest Amount. The transfer of the Interest Amount
will be made on or within 5 Local Business Days after the last Local
Business Day of each calendar month and on any other Local Business Day as
agreed between the parties
thereafter.
|
|
(iii)
|
Alternative to Interest
Amount. The provisions of Paragraph 5(c)(ii) will
apply.
|
(g) Addresses
for Transfers.
13
Party
A: UBS
AG
▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Tel: ▇▇
▇▇ ▇▇▇▇ ▇▇▇▇
Fax; ▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇
Fax; ▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇
For the
attention of the Collateral Manager
Party
B: PLEASE ADVISE
(h) Other
Provisions.
(i) The
definition of “Value” in Paragraph 10 of the Annex shall be amended as
follows:
(a) by
deleting the words under (B) and replacing with:
“a
security, the Base Currency Equivalent of the bid price obtained by the
Valuation Agent multiplied by the nominal amount of such security, plus any
income which, as of such date, has accrued but not yet been paid in respect of
the security to the extent not included in such price as of such date,
multiplied by the applicable Valuation Percentage, if any; and”
(b) by adding
at the end of sub-paragraph (i) thereof;
“Provided
that for a Valuation Date which is an Early Termination Date designated or
deemed to have occurred as a result of an Event of Default or an Additional
Termination Event, the Valuation Percentage shall be deemed to be
100%.”
(ii) The
final paragraph of Paragraph 3(a) is replaced by:
“If a
demand for transfer of Eligible Credit Support or Equivalent Credit Support is
received by the Notification Time, then the relevant transfer must be made not
later than the close of business on that Local Business Day, and if the demand
is received after the Notification Time, then the relevant transfer must be made
not later than the close of business on the next following Local Business
Day.”
(iii)
This Annex, including the act of transfer (disposition) itself, will be governed
and construed in accordance with English law.
14
15