Initial ____________
`
`Matchbook FX Holdings Inc.
`TRADING POLICIES
`As Amended 5/1/99
`
`These Matchbook FX Trading Policies supplement and constitute a vital part of your Customer Agreement. It is your
`1.0.
`responsibility as Customer to carefully read these Matchbook FX Trading Policies, and to inform Matchbook FX of any questions
`or objections which you may have regarding them before entering each and every trade order. In entering your trading orders with
`Matchbook FX, you affirm and warrant your thorough understanding and acceptance of these Policies, as they are set forth here
`and as may be amended from time to time by Matchbook FX. Before any trade orders may be entered, you must sign, date, tear off and
`return the Acknowledgment (last page).
`
`2.0.
`
`COMMON TRADING TERMS
`
`Balance
`2.1.
`The actual amount of U.S. Dollars in a Customer account, plus the theoretical marked-to-
`market value of any Open Positions in the account.
`
`Business Day
`2.2.
`Any day which commercial banks are open for business in the principal financial center of
`the country in whose currency a position is taken.
`
`Closed Positions
`2.3.
`Exposures in Foreign Currencies which have been extinguished by expiration, settlement
`or offset (e.g. Long Positions which have been fully offset by a corresponding Short Position in the same Foreign Currency and for
`the same Value Date).
`
`Daily Cut-off
`2.4.
`The point in time selected each Business Day by Matchbook FX which shall signify the end
`of that Business Day. The Trade Date of any Contract entered into after the Daily Cut-off shall be considered the next Business
`Day. The Daily Cut-off will occur at a time selected solely by Matchbook FX and may vary from day to day.
`
`Day-Only Order
`2.5.
`previously Filled or canceled.
`
`An Order which cancels automatically at or before the close of the Business Day, unless
`
`Fill
`2.6.
`A deal executed on behalf of a Customer’s account pursuant to an Order. Once filled, and
`Order cannot be canceled, amended or waived by the Customer.
`
`Foreign Currency
`2.7.
`Generally, the relationship between two national currencies which are freely and legally
`tradable on international (interbank ) markets and which Matchbook FX, in it’s sole discretion, may agree from time to time to buy
`from, or sell to its Customers, but EXCLUDING any exchange listed or off-exchange regulated commodity futures contract or
`option. Tradable “U.S. Dollar-based Currency Pairs” include USD/EUR (U.S. Dollar against European Euro), USD/JPY (U.S.
`Dollar against Japanese Yen), Sterling/USD (Pound Sterling against U.S. Dollar), and USD/CHF (U.S. Dollar against Swiss
`Francs). Popular “Cross-Currency Pairs” include EUR/JPY, EUR/CHF and EUR/GBP.
`
`An Order “Good Till Canceled” – i.e., permanently valid unless and until filled or canceled.
`GTC Order
`2.8.
`GTC orders do not automatically cancel at the end of the Business Day.
`
`OANDA – EXHIBIT 2003
`
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`Initial ____________
`
`Limit Entry Order
`2.9.
`An Order to establish an Open Position by selling or buying at a specified Spot Rate level.
`Although a Spot Rate level is specified upon entry of Limit Entry Orders, market conditions may often prevent the execution of an
`individual Customer’s Limit Entry Order despite other dealing activity at that price level, and/or may require such Orders to be Filled
`at a substantially different Spot Rate, and customer agrees to accept the best rate which Matchbook FX, in its discretion, may
`assign to the Fill. The Customer acknowledges that Matchbook FX shall accept such Orders only on a best-efforts basis.
`Matchbook FX shall have no liability for failure to fill such Orders, and makes no guarantee of their priority over the Orders of other
`Matchbook FX customers, principals or associates, or Matchbook FX.
`
`Margin
`.10.
`The minimum account Balance necessary, at the sole discretion of Matchbook FX, to
`establish a new Open Position (“Opening Margin”) or maintain an existing Open Position (“Maintenance Margin”).
`
`.2
`
`Margin Call
`2.11.
`The demand by Matchbook FX for the immediate remittance of additional money from the
`Customer to restore the account Balance to a level equal to or greater than the Opening Margin level.
`
`Market Order
`2.12.
`An order to sell or buy Foreign Currency (or Options) “at market” – i.e. immediately and at
`the next Spot Rate available for Customer dealing. No Spot Rate is specified when entering a Market Order, and the Customer
`agrees to accept the best price which Matchbook FX, in its discretion, may assign to the Fill.
`
`Marking to Market The process of recalculating the theoretical value of Open Positions in a Foreign Currency trading
`2.13.
`account assuming all Open Positions were liquidated at current market rates. Customer accounts must be marked to market at a
`specified time and Spot Rate in order to estimate and report the Balance in U.S. Dollars.
`
`Open Positions
`2.14.
`Exposures in Foreign Currencies (and/or Options) which have not been extinguished by
`expiration, settlement or offset, resulting normally either from a purchase (“Long Position”) or a sale (“Short Position”).
`
`Order
`2.15.
`Generally, an instruction by the Customer (or Customer’s authorized agent) to Matchbook
`FX to attempt to execute a trade for the Customer’s account.
`
`P/L (Profit / Loss)
`2.16.
`The actual gain or loss in U.S. Dollars resulting from trading activities on Closed Positions,
`plus the theoretical gain or loss on Open Positions that have been marked to market.
`
`Point (“Pip”)
`2.17.
`The smallest unit of price for any Foreign Currency (eg. for USD/CHF one point (or pip)
`equals .0001 Swiss Francs. For USD/JPY one point (or pip) equals .01 Japanese Yen.)
`
`The rate of exchange between two (2) Foreign Currencies for “Spot” value (normally
`Spot Rate
`2.18.
`settlement in two Business days), generally quoted either in “U.S. Terms” (price of one unit of Foreign Currency expressed in
`U.S. Dollars and Cents) or in “European Terms” (price of one U.S. Dollar expressed in units and decimals of the Foreign
`Currency). Spot Rates change rapidly. Published rates represent rates for deals between large commercial bank participants in
`the interbank market, and will normally differ from Spot Rates available for dealing to Matchbook FX customers.
`
`Stop Loss Order
`2.19.
`An Order to sell or buy a currency pair at a specified Spot Rate for the purpose of
`liquidating an Open Position during market conditions in which the Open Position has declined in value. Although a Spot Rate is
`specified upon entry of Stop Loss Orders, market conditions may often require such Orders to be Filled at a substantially different
`Spot Rate, and customer agrees to accept the best rate which Matchbook FX, in its discretion, may assign to the Fill.
`
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`Initial ____________
`
`Take-Profit Order
`2.20.
`An Order to sell or buy a currency pair at a specified Spot Rate for the purpose of
`liquidating an Open Position during market conditions in which the Open Position has increased in value. Although a Spot Rate is
`specified upon entry of Take Profit Orders, market conditions may often prevent the execution of an individual Customer’s Take-
`Profit or Limit Entry Order despite other dealing activity at that price level. The Customer acknowledges that Matchbook FX shall
`accept such Orders only on a best-efforts basis. Matchbook FX shall have no liability for failure to fill such Orders, and makes no
`guarantee of their priority over the Orders of other Matchbook FX customers, principals, associates, associated companies, or
`Matchbook FX.
`
`3.0
`
`CUSTOMER ACCOUNTS
`
`3.1.
`
`3.2.
`
`3.3.
`
`3.4.
`
`3.5.
`
`Currency.
`All initial deposits to customer accounts will be accepted in only U.S. Dollars,
`and, unless settlement and delivery of a foreign currency have taken place, all Balances shall be computed and reported
`only in U.S. Dollars.
`
`Minimum Initial Deposit.
`check or wire transfer is required.
`
`To open a Matchbook FX trading account, a minimum deposit of $15,000 by
`
`Recognition of Deposits.
`No deposit shall be recognized until the wire or check has been fully cleared and
`collected by Matchbook FX’s bank or depository institution.
`
`Withdrawals.
`Payments from a customer account require a Notice of Withdrawal signed by all
`required parties, and require a minimum of Four (4) Business Days from receipt of the Notice of Withdrawal for issuance
`of a check or wire transfer.
`
`Fees.
`All banking fees shall be charged to the Customer’s account at Matchbook FX’s
`discretion, including a $25.00 Matchbook FX fee, over and above any bank fees, for each returned check.
`
`4.0
`
`MARGIN REQUIREMENTS
`
`4.1.
`
`Opening Margin.
`
`Current Opening Margin requirements are as follows, and are subject to change:
`
`Daylight Margin(EST)
`
`Overnight Margin(EST)
`
`U.S. Dollar-Based Pairs
`
`4.0% of Open Position value
`
`5.0% of Open Position value
`
`Cross-Currency Pairs
`
`4.0% of open Position value
`
`5.0% of Open Position value
`
`4.2.
`
`Maintenance Margin.
`For most accounts under standard market conditions, and subject to all rights of
`Matchbook FX to vary such requirements at its discretion pursuant to the Customer Agreement, the Maintenance Margin
`level shall be set at Seventy-five Percent (75%) of the Opening Margin level.
`
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`Initial ____________
`
`4.3.
`
`4.4.
`
`4.5.
`
`Margin Calls.
`In the event that, in the opinion of Matchbook FX, and in accordance with Matchbook FX’s
`reasonable best estimate of then prevailing obtainable market spot dealing rates, the account Balance should fall below
`the Maintenance Margin level for an individual Open Position, or for a group of netted Open Positions, or for the
`Customer’s account in aggregate, Matchbook FX shall, at its discretion, make one attempt to contact the Customer by
`telephone at a maximum of one (1) designated telephone number, which may, at the Customer’s option, be a pager or
`an automated answering or voice recording system. In the course of such attempt, Matchbook FX shall indicate, to the
`extent reasonably possible, that a Margin Call is being issued on the subject account. Following completion of the
`attempt, the Customer shall have Three (3) hours to remit, by wire transfer to the coordinates shown on the Matchbook
`FX Wire Transfer Instructions Sheet, sufficient money in U.S. Dollars to raise his/her Balance to the Opening Margin
`levels. In the event the Customer fails to remit the required Margin within the specified time, Matchbook FX shall, at its
`discretion, have the right, but not the obligation, to liquidate any or all Open Positions in the Customer’s account, and the
`Customer shall remain liable for any resulting deficit balances. Once issued, the Customer must comply in full with the
`Margin demand regardless of subsequent price action and irrespective of any recovery in market value of the subject
`Open Positions. Customer trading is prohibited while any Margin Call remains unsatisfied.
`
`Subject to all additional rights of Matchbook FX under the Customer Agreement, in the
`Lockout Level.
`event that, in the opinion of Matchbook FX and in accordance with Matchbook FX’s reasonable best estimate of then
`prevailing obtainable market spot dealing rates, and regardless of whether or not prior Margin Calls have been issued or
`met, the account Balance should at any time fall below Fifty Percent (50%) of the Opening Margin level for an individual
`Open Position, or for a group of netted Open Positions, or for the Customer’s account in aggregate, Matchbook FX shall
`have the right, but not the obligation, to liquidate any or all Open Positions in the Customer’s account, and the Customer
`shall remain liable for any resulting deficit balances.
`
`Confirmation and Re-entry Opportunity. Should Matchbook FX decide pursuant to this Paragraph 4 to liquidate any
`Open Position in the Customer’s account, or otherwise in accordance with its rights under the Customer Agreement,
`Matchbook FX shall make one attempt to contact the Customer by telephone at each of a maximum of One (1)
`designated telephone number which may, at the Customer’s option, be a pager or an automated answering or voice
`recording system, for the purpose of attempting to confirm such liquidation and, at the discretion of Matchbook FX,
`offering the customer the opportunity to post sufficient Margin and reestablish any of the liquidated positions at then
`prevailing and obtainable market dealing rates. Matchbook FX shall have no liability to the Customer whatsoever for any
`decision Matchbook FX may make to liquidate, or not to liquidate, any Open Position, nor for any failure of customer to
`receive Margin Calls or confirmations.
`
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`Initial ____________
`
`5.0.
`
`TRADING HOURS
`
`5.1.
`
`5.2.
`
`5.3.
`
`General. All references to Matchbook FX hours of trading are in EST (U.S. Eastern Standard Time) using 24-hour
`format. Matchbook FX normally provides access to O.T.C. Foreign Exchange quotes from 19:00 on Sunday to 15:45 on
`Friday, but Matchbook FX reserves the right to suspend or modify its trading hours at any time. O.T.C. Foreign Currency
`markets operate 24 hours a day. It is the sole responsibility of the Customer to remain available for Margin Calls, Order
`and Fill confirmations, and other communications regarding the Customer’s Matchbook FX account at any time.
`
`Daylight Trading Hours.
`
`Daylight Trading Hours are 08:00 - 15:00 U.S. EST on any given Business day.
`
`Overnight Trading Hours. Overnight Trading Hours are 15:00 – 08:00 on the following business day , U.S. EST, and
`represent the period between the close of the New York (interbank) market and the re-opening of the (interbank) market
`in New York on the following business day. Due to sharply reduced liquidity and commensurately higher risk of holding
`Open Positions during this period, Overnight Margin rates are normally higher than Daylight rates. Matchbook FX
`reserves the right to close out any Open Position carried by a customer into Overnight Trading Hours without an
`associated Stop/Loss Order, or to set a Stop/Loss Order on such positions at Matchbook FX’s discretion.
`
`6.0. TRADE ORDERS
`
`6.1.
`
`6.2.
`
`Order Entry / “Execution Only”.
`All orders shall be placed through the Matchbook FX Online Order Entry System
`or by telephone through the Matchbook FX Order Desk in New York. While Matchbook FX, as the principal counter party
`to its Customers, enjoys distinct market advantages and works diligently to fill all its Customers’ orders quickly and at the
`best rate possible, all Orders shall be accepted on a strict “Execution Only” basis – i.e. regardless of market levels or
`Spot Rates quoted, reported price action, or erroneous oral confirmations, no trade Order shall be deemed Filled, and
`Matchbook FX shall have no liability whatsoever for any Order accepted, until and unless such Order is (1) actually
`executed, covered and offset with another Matchbook FX customer or one or more of Matchbook FX’s clearing
`counterparties; or (2) accepted by and offset against Positions of Matchbook FX, its associated principals, officers,
`directors, affiliates, associates, employees, banks, bank employees, dealers or Matchbook FX affiliated institutions, and
`confirmed in writing by Matchbook FX.
`
`Order Recording / Confirmation.
`Any and all conversations with Matchbook FX principals, agents or associates,
`including the Matchbook FX Order and Operations Desks may, at the option of Matchbook FX, be tape recorded to
`enhance the quality of service, ensure fairness to all parties, and resolve potential disputes. Orders entered with a
`Matchbook FX Associate or the Matchbook FX Order-Desk may, at Matchbook FX’s option, be confirmed via telephone
`by the Matchbook FX Operations Desk. In the event that Matchbook FX is unable, for any reason, to reach the
`Customer and confirm an Order, Matchbook FX shall have the option to cancel such order without liability. Unless
`otherwise specified, any Order entered with Matchbook FX shall be accepted on a Good Till Canceled basis.
`
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`Initial ____________
`
`6.3.
`
`6.4.
`
`Terms of Acceptance for Orders.
`It is the Customer’s sole responsibility to clearly indicate the terms of an Order
`when entered, whether Market, Take Profit, Limit Entry, Stop/Loss, Day-Only, or GTC and including the Order’s value
`date and specified Spot Rate limits, where applicable. Although a Spot Rate is specified upon entry of Stop-Loss, Take-
`Profit and Limit Entry Orders, market conditions may often prevent the execution of an individual Customer’s Take-Profit
`or Limit Entry Order despite other dealing activity at that price level, or may often require Stop-Loss or Limit Entry Orders
`to be Filled at a substantially different Spot Rate, and customer agrees to accept the best rate which Matchbook FX, in its
`discretion, may assign to the Fill. The Customer acknowledges that Matchbook FX shall accept all Orders only on
`a best-efforts basis. Matchbook FX shall have no liability for failure to fill Orders, and makes no guarantee of an
`Order’s priority over the Orders of Matchbook FX, its other customers, associated principals, officers, directors,
`affiliates, associates, employees, banks, bank employees or dealers. No Stop/Loss or Limit Entry Order will be
`accepted unless the specified Spot Rate limits on such orders are at least Twenty (20) Points away at the time of Order
`entry. Matchbook FX shall have the right, but not the obligation, to reject any Order before or after confirmation,
`or to cancel and rescind any Fill, where the Customer’s account contains insufficient Margin at the time of Order
`entry, or where, in the opinion and sole discretion of Matchbook FX, the execution of such Order may place the
`Customer’s account in an insufficient Margin condition, or where such Order or Fill is illegal or otherwise
`improper.
`
`Confirmation of Fills. After a Customer Order is Filled, and as soon as reasonably possible given market conditions,
`Matchbook FX shall attempt to notify the customer of the fill by one of the following means: Electronically (on screen), via
`e-mail, fax, by telephone or by other means at the sole discretion of Matchbook FX. In the event of an attempt to contact
`the customer by telephone, Matchbook FX shall contact the Customer at a maximum of One (1) designated telephone
`number, which may, at the Customer’s option, be a pager or automated answering or voice recording system, for the
`purpose of attempting to confirm such Fill. Any failure of Matchbook FX to confirm a Fill by telephone or any other
`means, or any failure of customer, for any reason, to receive such confirmation, shall not invalidate the Fill, and shall
`under no circumstances give rise to liability on the part of Matchbook FX, or its own or its affiliated organization’s
`associated principals, officers, directors, affiliates, associates, or employees. Confirmations of Fills, and statements of
`accounts for Customer shall be deemed correct and shall be conclusive and binding upon Customer if not
`objected to immediately upon telephone confirmation, and such objection is confirmed in writing within three(3)
`days after transmittal to Customer by mail or otherwise.
`
`7.0 MATCHBOOK FX CLEARLY ERRONEOUS TRADE POLICY
`
`Clearly Erroneous Trades Executed on the Matchbook FX Network (MBFX)
`
`If an MBFX customer receives an execution on an order that was either entered, or executed in obvious error, the customer may contact the
`MBFX Help Desk (24 hours/day Sunday 19:00 EST through Friday 16:00 EST) and request that MBFX review the trade to determine if it is,
`in fact, a Clearly Erroneous trade.
`
`A ‘Clearly Erroneous Trade’ shall be defined for purposes of this notice as a transaction resulting from an order that was, at the time of
`execution, so far outside of the traded range for a given currency pair for a given trading day, or, as applicable, outside the traded range for a
`given currency pair for a particular period of time (as determined in the interbank market), as to manifest no basis in good faith other than
`mistake.
`
`The customer understands that it is possible for orders to be executed on the Matchbook FX network outside or at a different rate from the
`interbank best Bid / Offer or any other Foreign Exchange Bid/Offer market. Such variant executions are not necessarily Clearly Erroneous
`
`

`

`Initial ____________
`
`Trades. In the event, however, that the MBFX staff determines a transaction is Clearly Erroneous as defined above, MBFX may, at its sole
`option and in its sole discretion, break, cancel, nullify, amend or modify the transaction. In no event however shall MBFX have any liability
`whatever to any party for the exercise of such discretion, or for its actions or inaction in regard to Clearly Erroneous Trade complaints.
`
`All trades executed on the MatchbookFX system shall remain fully binding, and nothing contained in this notice, nor any action or inaction in
`connection herewith, shall in any event be construed to alter or modify any of the terms of the Customer Agreement, Trading Policies, or any
`other agreements between MBFX and the Customer. No action or inaction by MBFX in connection with this Clearly Erroneous Trade policy
`shall be construed as a waiver or course of dealing upon which any party may rely for any purpose, nor shall same create any obligation
`whatsoever on the part of MBFX with respect to future dealings.
`MBFX requires that customers submit requests to review transactions that are alleged to be Clearly Erroneous via telephone, within 15
`minutes from the time the disputed or questioned trade was executed. MBFX may, at its sole option and in its sole discretion, consider
`requests received after such time period, depending on the facts and circumstances surrounding such request. The complainant will receive
`a written determination from MBFX.
`
`It is the responsibility of institutional customers of Matchbook FX to notify its own personnel, who may be in multiple branch offices, as to the
`terms of this policy
`
` Matchbook FX, and your Account Executive have explained to you that Matchbook FX and/or its
`General Disclosures.
`8..0.
`affiliated organizations make markets in, and act as principal counter party in Foreign Currency transactions for Matchbook FX Customer
`accounts. While such an arrangement gives Matchbook FX many distinct advantages in servicing its Customers in O.T.C. Foreign
`Currencies, the Customer should remain aware that the O.T.C. Foreign Currency market is unregulated, and that Matchbook FX may at
`times be working to fill several Customer Orders at similar Spot Rate levels simultaneously, along with its own proprietary Orders, or those of
`its own or its affiliated organization’s associated principals, officers, directors, affiliates, associates, or employees. While Matchbook FX also
`enjoys the advantage of unique and rapid access to real time (interbank) price information, all Spot Rate quotes given to Customers are
`informational levels only, and Matchbook FX shall not be held to such quotes for Customer dealing purposes. The Fill rate on Market Orders
`can and will vary from initial Spot Rate quotes.
`
`

`

`Initial ____________
`
`ACKNOWLEDGEMENT
`
`To be read, signed, dated, torn off and returned before entering any trade orders
`
`I acknowledge having received and carefully read my copy of the Matchbook FX Trading Regulations as amended
`9/1/99. I have obtained satisfactory answers from Matchbook FX as to any questions I may have had regarding these current
`Trading Regulations. I understand that these current Trading Regulations supplement and constitute a part of my Customer
`Agreement.
`
`-------------------------------------------------
`Customer Signature
`
`-----------------------------------------------------------------------
`Date
`
`Customer Name (Print)
`
`