MARGIN FOREIGN EXCHANGE AND FOREIGN EXCHANGE OPTIONS

CLIENT SERVICE AGREEMENT Halifax New Zealand Limited Client Service Agreement Product Disclosure Statement for MARGIN FOREIGN EXCHANGE AND FOREIGN EXCHANGE OPTIONS Halifax New Zealand Limited Financial Services Provider No. 146605 Date 26th May 2015 HALIFAX Client Service Agreement 1

This document provides important information about Margin FX and FX Options to help you decide whether you want to enter into any of these derivatives. There is other useful information about this offer at www.business.govt.nz/disclose. Many derivatives are complex and high-risk financial products that are not suitable for most retail investors. If you do not fully understand a derivative described in this document and the risks associated with it, you should not enter into it. You can also seek advice from a financial adviser to help you make your decision. You should ask if that adviser has experience with these types of derivatives. Halifax New Zealand Limited has prepared this document in accordance with the Financial Markets Conduct Act 2013. i HALIFAX NZ

1. Key Information Summary 1.1 What is this? This is a product disclosure statement (PDS) for Margin FX and FX Options provided by Halifax New Zealand Limited (Halifax, we, our, us). Margin FX and FX Options are derivatives, which are contracts between you and Halifax that may require you (client) or Halifax to make payments or deliver a currency or other asset (as the case may be). The amounts that must be paid or received, or both will depend on the amounts that must be paid or received, or both of the underlying currency or other asset (as the case may be). The contract specifies the terms on which those payments or deliveries must be made. 1.2 Warning 1.2.1 Risk that you may owe money under the derivative If the price or value (as the case may be) of the underlying currency or other asset changes, you may suffer losses. In particular, unlike most other kinds of financial products, you may end up owing significant amounts of money. You should carefully read section 2.8 of this PDS on how payments are calculated. 1.2.2 Your liability to make margin payments Halifax may require you to make additional margin payments to contribute towards your future obligations under the Margin FX and FX Options. These payments may be required at short notice and can be substantial. You should carefully read section 2.8 of this PDS about your obligations. 1.2.3 Risks arising from issuer s creditworthiness When you enter into derivatives with Halifax, you are exposed to a risk that Halifax or its Platform Counterparties cannot make payments or deliver a currency or other asset (as the case may be) as required. You should carefully read section 3 of this PDS (risks of these derivatives) and consider the creditworthiness of Halifax and its Platform Counterparties. If Halifax or a Platform Counterparty runs into financial difficulty, the margins you provide may be lost. 1.3 About Halifax New Zealand Limited Halifax is a New Zealand company which issues derivatives on contracts for difference, exchange traded options, Margin FX and FX Options. In addition Halifax offers broking services in exchange traded futures and exchange traded futures options contracts. For more information about Halifax see section 6 of this PDS. 1.4 Which derivatives are covered by the PDS? The derivatives covered by this PDS are Margin FX and FX Options. Margin FX and FX Options are over-thecounter (OTC) derivative contracts. This means that they are created and traded off-market between you and Halifax rather than on an exchange, such as a stock exchange or futures exchange. 1.4.1 What are Margin FX and FX Options? A Margin FX is a derivative contract entered into between you and Halifax. Under the contract we agree to pay each other the difference arising from movements in the value of an Underlying Instrument such as changes in the Exchange Rate for two currencies or changes to the price of certain precious metals. An FX Option is an option contract for a Margin FX Contract that you enter into with Halifax. Under an FX Option, the buyer pays an amount (Premium) in exchange for the rights, but not the obligation, to enter into a Margin FX Contract with the seller at a pre-agreed rate. The seller has no rights other than a right to receive the Premium. You can be either the buyer or the seller under an FX Option. HALIFAX NZ ii

1.4.2 What are the key benefits and uses of Margin FX and FX Options Margin FX and FX Options are generally used for one of two purposes hedging or speculating: a. Hedging: They can provide investors or traders with a facility for managing risks associated with changing prices of investments or commodities. b. Speculation: They can be traded by speculators, who trade in them hoping to profit from the changing prices in the Underlying Instrument. For more information about Margin FX and FX Options see section 2 of this PDS. Margin FX and FX Options allow you to utilise margins to leverage your positions to take a much greater exposure to the price of an Underlying Instrument than if you were to buy and sell the Underlying Instrument directly. This has the capacity to significantly increase the potential losses or returns. See section 2.8 of this PDS for further information regarding the use of margins when trading Margin FX and FX Options. iii HALIFAX NZ

Contents 1. Key Information Summary ii 2. Key features of the derivatives 1 3. Risks of these derivatives 12 4. Fees 14 5. How Halifax treats funds and property received from you 18 6. About Halifax New Zealand Limited 19 7. How to complain 19 8. Where you can find more information 20 9. How to enter into Client Service Agreement 20 Glossary 21 HALIFAX NZ iv

2. Key features of the derivatives 2.1 What is Margin FX? Margin FX is an agreement between you and Halifax to pay the other the difference arising from movements in the value of an Underlying Instrument, without either party having to actually own the Underlying Instrument. A Margin FX is an OTC derivative product. This means that Margin FX Contracts are created and traded offmarket between you and Halifax rather than being traded on an exchange, such as a stock exchange or futures exchange. The Underlying Instrument for a Margin FX Transaction is the Exchange Rate. The Exchange Rate can be either the price of one currency expressed in the terms of another currency (FX Transactions) or the price of a precious metal expressed in a specified currency or precious metal (Metal Transactions). FX Transactions and Metal Transactions are discussed in further detail in section 2.4.1 of this PDS. All Margin FX Transactions remain open until they are Closed Out. This occurs where the client enters into an equal and opposite Transaction and the two positions are offset against each other. See section 2.4 of this PDS for further information on the key features of Margin FX products. 2.2 What are FX Options Option Contracts traded over Margin FX Contracts are referred to as FX Option Contracts. The buyer of an FX Option Contract pays a Premium in exchange for the right, but not the obligation, to enter into a Margin FX Transaction with the seller at a predetermined Exchange Rate (called the Exercise Rate) on the Expiry Date. The seller under a FX Option Contract has no right other than a right to the Premium. The seller will be under an obligation to enter into a Margin FX Transaction at the Exercise Rate of the FX Option Contract if the FX Option Contract is validly exercised by the buyer. If the FX Option Contract is exercised at the Expiry Date, this will result either in a Cash Settlement or the establishment of a Margin FX Transaction between the buyer and the seller. You can terminate your exposure under an FX Option Contract before the Expiry Date by: a. where you are the buyer of the FX Option, selling to Halifax a corresponding FX Option; or b. where you are the seller of the FX Option, buying from Halifax a corresponding FX Option. See section 2.5 of this PDS for further information on the key features of FX Options. 2.3 Trading Margin FX and FX Option Contracts When you enter into a Margin FX or FX Option Contract with us, you do so through an online interface (referred to as a Trading Platform). The Trading Platforms that can be used to trade Margin FX or FX Option Contracts are Halifaxonline, MetaTrader4 and Trader Work Station. Set out below is a summary of the types of orders that you can place with Halifax and on the Trading Platforms (refer to section 2.9 of this PDS for further information about entering into Margin FX and FX Option Contracts on the Trading Platform). 1 HALIFAX NZ

Order type Market Stop Loss Stop Entry Market If Touched Limit One Cancels The Other Description An order filled immediately at the best price available. An order that becomes a market order only when the price offered by Halifax on the relevant Trading Platform trades at a specified price. An order placed to open a new position or increase an existing open position at a price which is inferior to the current price offered by Halifax. A price order that becomes a market order when the price offered by Halifax on the relevant Trading Platform trades at a specified price at least once. An order that can be filled only at a specified price or better. An order that includes two orders, one of which cancels the other when filled. Also referred to as one-cancels-other. If Done Good Til Cancelled Orders Standing Order 2.4 Key features of Margin FX An order that includes two orders, where the second of the two orders only becoming active should the first order be executed. An order which remains in the relevant Trading Platform until it is either executed according to the terms of that order or cancelled by you. A standing order means an instruction to execute an order for a specified volume on a recurring basis if triggered, unless otherwise cancelled. 2.4.1. Differences between FX Transactions and Metal Transactions Margin FX Transactions can either be FX Transactions or Metal Transactions. FX Transactions The key features of FX Transactions are as follows: a. FX Transactions are available in most widely traded currencies. b. In order to enter into an FX Transaction, you must select two currencies. c. The Underlying Instrument for an FX Transaction is the Exchange Rate. The Exchange Rate is the price of one currency in terms of another currency (called a Currency Pair). For example, the Exchange Rate might be the price of the New Zealand dollar (NZD) in terms of the United States dollar (USD). If the current Exchange Rate for the NZD against the USD (NZD/USD) is 0.7000, this means that one NZD equates to, or can be exchanged for, USD 0.7000 or 70 US cents. This example is included for illustrative purposes only, and is not indicative of actual exchange rates or values. d. All FX quotations are made up of two currencies; the Base Currency and the Terms Currency. The Base Currency can be identified as being the first currency in the Currency Pair. The second currency in your Currency Pair is referred to as your Terms Currency. So, for an FX Transaction where the Underlying Exchange Rate is NZD/USD, NZD will be the Base Currency and USD will be the Terms Currency. e. Unlike contracts traded on an exchange, OTC products are not standardised. The terms of an FX Transaction are individually tailored to the particular requirements of the parties involved in the contract i.e. Halifax and the client. f. The terms involved in the negotiation of FX Transactions are: i. the Currency Pair; ii. iii. iv. the amount of the Base Currency to which the Transaction relates (called the Notional Value); the Exchange Rate at which such currencies are to be exchanged; and the Value Date for the Transaction (see section 2.4.5 of this PDS). HALIFAX NZ 2

g. FX Transactions are negotiated and agreed with Halifax acting as counterparty (and principal) in its dealings with you. These are transactions between you and us and can only be entered into with us and Closed Out with us. It is not possible to Close Out the FX Transactions with any other party. h. FX Transactions are subject to Margin Requirements and marked to market on at least a daily basis (for more information refer to section 2.8.3 of this PDS). Metal Transactions Metal Transactions are the same as FX Transactions except in the following instances: a. Under Metal Transactions you make a profit or incur a loss if the value of a precious metal (limited to gold or silver) appreciates or depreciates (depending on the direction of the trade) when compared against a currency or precious metal (called a Metal Pair). For example, the Exchange Rate might be the price of Spot Gold (XAU) in terms of USD. If the current Exchange Rate for Spot Gold against the USD (XAU/USD) is 1300.00, this means that 1 ounce of Spot Gold equates to, or can be exchanged for, USD 1,300.00. This example is included for illustrative purposes only, and is not indicative of actual exchange rates or values. b. The Base Currency for Metal Transactions will always be either gold or silver. Most widely traded currencies are available to make up the Terms Currency of the Metal Pair along with either metal or gold. Margin FX transactions are a speculative investment and involve a high degree of risk. It Is not suitable for all investors. You should not transact in Margin FX unless you are experienced in derivatives, leveraged products and foreign exchange contracts, and you understand the risks of transacting in Margin FX. You are responsible for the selection of the Currency Pair or Metal Pair for each Transaction. The performance of a Margin FX Transaction will depend on movements in the Underlying Instrument for the Currency Pair or Metal Pair you select and on your trading strategy. The value of an investment in Margin FX can change rapidly and by significant amounts at any time 2.4.2. You can take both long and short positions Of the two currencies that make up the Currency Pair (for FX Transactions) or the precious metal(s) and/ or the currency that make up the Metal Pair (for Metal Transactions), you must select the currency or precious metal that you think will appreciate relative to the other (this is always referred to as the Long Currency) and the currency or metal you think will depreciate relative to the other (this is always referred to as the Short Currency). If the value of the Long Currency appreciates relative to the value of the Short Currency then the value of that Transaction will increase and you may profit. If the value of the Short Currency appreciates relative to the value of the Long Currency then the value of the Transaction will decrease and you will make a loss. 2.4.3. Calculating profits and/or losses The gross profits or losses on a Margin FX Transaction will be equal to the difference between the value of the Base Currency multiplied by Exchange Rate at which the Transaction was entered into (this gives you the Terms Currency) and the value of the Base Currency multiplied by Exchange Rate at which the Transaction is Closed Out (this gives you the Terms Currency). The difference between the two amounts will either be the gross profit (if your Long Currency appreciates relative to your Short Currency) or loss (if your Long Currency depreciates relative to your Short Currency) on the trade. If the Underlying Exchange Rate moves in your favour (i.e. your Long Currency appreciates relative to your Short Currency) the amount determined by this formula will be greater than zero and Halifax will credit this amount (less any fees, charges, commission and spreads as explained in section 4 of this PDS) to your Trading Account. By contrast, if the Underlying Exchange Rate moves against you (i.e. your Short Currency appreciated relative to your Long Currency) the amount determined by this formula will be less than zero and Halifax will debit that amount (as well as any fees, charges, commission and spreads as explained in section 4 of this PDS) from your Trading Account. 3 HALIFAX NZ

For example: Assume your Trading Account Currency is NZD. You enter into a Margin FX Transaction by purchasing 100,000 NZD/USD (i.e. you enter into a long FX Transaction, where NZD is your Long Currency and USD is your Short Currency) and the Exchange Rate at which you enter into the FX Transaction is 0.7200. Later that day you Close Out the Margin FX Transaction by selling (or entering into a short FX Transaction, i.e. where NZD is your Short Currency) at a higher exchange rate of 0.7250. The resulting gross profit on the Transaction would be US$500 being sale price (0.7250) less buy price (0.7200) x 100,000. The net profit is determined after deducting commission (where applicable), Rollover charges, transaction costs and any other charges and is converted back to your Trading Account Currency (for more information on costs and charges refer to section 4 of this PDS. The example above is for illustrative purposes only. It provides an example of one situation only and does not reflect the specific circumstances or the obligations that may arise under a derivative you enter in to. For additional trade examples please refer to Halifax NZ s FX Trading Examples Booklet found on Halifax NZ s website at http://www.halifaxonline.co.nz/support/disclosure-documents. 2.4.4. Realised and unrealised profits and losses Profits and losses are realised if both the buy and the sell side of the Transaction have been completed and have been matched against each other or Closed Out. Profits and losses are unrealised if only one side of the Transaction has been completed (i.e. it remains an open position) and will only be realised when the other side of the Transaction has reached completion. For a worked example of how an open position is Closed Out we refer you to the trading examples on our website at http://www.halifaxonline.co.nz/support/disclosure-documents. 2.4.5. Value Dates The Value Date for a FX Transaction is the date on which the parties (i.e. you and Halifax) agree to settle their respective obligations. The Value Date can affect the Exchange Rate at which a FX Transaction is entered into. When you enter into a Margin FX Transaction with Halifax, by default the Transaction will be a Spot Contract however, you have the option to select that the Transaction be a FX Forward. Spot Contracts The Value Date for Spot Contracts is standardised and non-negotiable. For most spot foreign exchange contracts, the Value Date will be two business days from the trade date (T+2). FX Forwards The Value Date for a FX Forward Contract is not standardised and is negotiable. It is typically somewhere between three business days and two years. The Exchange Rate for FX Forward contracts (and, by extension, the Exchange Rate Halifax will offer on an FX Forward contract) is adjusted by adding or subtracting Forward Points to the Exchange Rate. For example, if Halifax offers 92.00/92.03 for an NZD/USD Spot Transaction, it might offer 91.25/91.31 for an FX Forward with a Value Date that is one year after the date the transaction is entered into. This example is included for illustrative purposes only, and is not indicative of actual exchange rates that will be offered or Forward Points adjustments. The primary factor that affects the Forward Points adjustment on a FX Forward Contract is the difference between the interest rates applicable to the relevant Currency Pair (referred to as the interest rate differential). Generally, a. If the interest rate for the Terms Currency is lower than the interest rate for the Base Currency, the Forward Points adjustment will result in the Exchange Rate being lower than the Exchange Rate that would be offered for a corresponding FX Spot contract. This is otherwise known as a points discount. b. If the interest rate for the Terms Currency is higher than the interest rate for the Base Currency, the Forward Points adjustment will result in the Exchange Rate being higher than the Exchange Rate that would be offered for a corresponding FX Spot contract. This is otherwise known as a points premium. HALIFAX NZ 4

2.5 Key Features of FX Options FX Option Contracts are a speculative investment and involve a high degree of risk. They are not suitable for all investors. You should not transact in FX Option Contracts unless you are experienced in derivatives, leveraged products and foreign exchange contracts, and you understand the risks of transacting in FX Option Contracts. You are responsible for the selection of the Currency Pair or Metal Pair for each Transaction. The performance of any particular Transaction will depend on movements in the Exchange Rate of the Currency Pair or Metal Pair you select and on your trading strategy. The value of any particular Transaction can change rapidly and by significant amounts at any time. 2.5.1. Style of FX Options Halifax only offers FX Options that are European Options. European Options can only be exercised by the buyer at the Expiry Date. European Options cannot be exercised at any time prior to Expiry Date. 2.5.2. Types of FX Option Contracts There are two types of FX Option Contracts; Call Options and Put Options. Buyer s perspective From the buyer s perspective, an FX Option Contract that is a Call Option gives the buyer the right, but not the obligation, to buy or enter long a Margin FX Transaction at the prescribed Exercise Rate in return for payment of a Premium. An FX Option Contract that is a Put Option gives the buyer the right, but not the obligation, to sell or enter short a Margin FX Transaction at the prescribed Exercise Rate in return for payment of a Premium. Seller s perspective From the seller s perspective, the seller has no right other than a right to the Premium. The seller will be under an obligation to sell or enter short a Margin FX Transaction (in the case of a Call Option) or to buy or enter long a Margin FX Transaction (in the case of a Put Option) at the Exercise Rate of the FX Option Contract if the FX Option Contract is validly exercised by the buyer. 2.5.3. Difference between Call Options and Put Options Call Option For a bought Call Option, the Base Currency will be the Long Currency and the Terms Currency will be the Short Currency. If the Underlying Instrument for a bought Call Option is NZD/USD, then the buyer of the Call Option will be taking a view that the NZD will appreciate against the USD. Put Option For a bought Put Option, the Base Currency will be the Short Currency and the Terms Currency will be the Long Currency. If the Underlying Instrument for a bought Call Option is NZD/USD, then the buyer of the Put Option will be taking a view that the NZD will depreciate against the USD. 2.5.4. Exercise Rate The Exercise Rate is the predetermined Exchange Rate at which the buyer and seller will enter into a Margin FX Transaction. There is potential to make a profit or incur a loss on the exercise of an FX Option Contract because the Exercise Rate at the Expiry Date may be different to the then current market Exchange Rate for the Currency Pair or Metal Pair. The difference between the Exercise Rate and the actual market level of the Underlying Exchange Rate for the Currency Pair or Metal Pair at any particular time will determine whether the FX Option Contract is in the money, out of the money or at the money. In the money An FX Option Contract is in the money if: a. For a Call Option: The Exchange Rate for the Currency Pair or Metal Pair is higher compared to the Exercise Rate. b. For a Put Option: The Exchange Rate for the Currency Pair or Metal Pair is lower compared to the Exercise Rate. 5 HALIFAX NZ

If the FX Option Contract remains in the money at the Expiry Date and it is a Call Option, from the buyer s perspective, then the buyer can exercise the FX Option Contract and receive a long position at Exercise Rate or be Cash Settled (refer to section 2.5.6 of this PDS for further details). If the FX Option Contract remains in the money at the Expiry Date from the seller s perspective, then the seller has an obligation to enter into a short Margin FX Transaction or be Cash Settled. Out of the money Conversely, an FX Option Contract is out of the money if: a. For a Call Option: The Exchange Rate for the Currency Pair or Metal Pair is lower compared to the Exercise Rate. b. For a Put Option: The Exchange Rate for the Currency Pair or Metal Pair is higher compared to the Exercise Rate. If an FX Option Contract is out of the money at a particular point in time, this does not mean it does not have value. That is, it may still have time value i.e. time until the Expiry Date in which the price of the Underlying Instrument may move in your favour. If the FX Option Contract remains out of the money at the Expiry Date, then the FX Option Contract will expire worthless. The buyer will have made a gross loss for the value of the Premium and the seller will have made a gross profit equal to the value of the Premium. At the money An FX Option Contract will be at the money if the Exercise Rate is equal to the current market level of the Exchange Rate for the Currency Pair or Metal Pair at a particular time. You should note that: 1. When you buy an FX Option Contract you may lose the entire Premium paid as an FX Option Contract that is out-of-the-money or at-the-money at expiry will not be exercised and will expire worthless. 2. When you sell an FX Option Contract, although you receive the Premium upfront, you are exposed to potential losses in the future in the event that the price of the Underlying Instrument moves against your position. The maximum amount of this potential loss is unlimited and as such, selling unprotected options comes with a high degree of risk. 3. If you are contemplating purchasing a deep out of the money option (i.e. an FX Option with an Exercise Rate that is significantly below (for a Call Option) or above (for a Put Option) the current market level of the Exchange Rate for the Currency Pair or Metal Pair) you should be aware that the chance of such an FX Option Contract becoming profitable is generally remote. 2.5.5. How is the Premium determined The price to be paid or received in relation to an FX Option Contract is the Premium. It is negotiated between the buyer and seller of the FX Option Contract and is payable by the buyer to the seller at the time the FX Option Contract is entered into (this payment is effected through a debit or credit to your Trading Account). The Premium is the compensation for the seller accepting the risk involved in selling the FX Option Contract. The full amount of the Premium is payable immediately upon executing the FX Option Contract. This means that there must be sufficient Net Free Equity in your Trading Account to cover the Premium before you can buy an FX Option Contract. If you buy an FX Option Contract, then the Premium will represent a fixed transaction cost. Any gross profit that is ultimately realised on the Transaction will need to exceed the value of the Premium (plus any other charges, fees and other amounts) before you make a net profit. 2.5.6. Exercising FX Option Contracts Before entering into an FX Option Contract, you must select an exercise method for the FX Option Contract. There are two exercise options to select from. a. Cash Settlement: If an FX Option Contract is Cash Settled and the FX Option Contract is exercised, an adjustment will be made to your Trading Account to reflect the sum of: (i) the Notional Value for the FX Option Contract multiplied by the Exercise Rate minus (ii) the Notional Value of the FX Option Contract multiplied by the level of the Exchange Rate for the Currency Pair or Metal Pair at which Halifax would offer to enter into a Margin FX Contract with you at the Expiry Date. HALIFAX NZ 6

b. Spot Settlement: If an FX Option Contract is Spot Settled, then on exercise the buyer and the seller will enter into a Margin FX Transaction at the Exercise Rate. The Margin FX Transaction will be on the terms agreed when the buyer and seller entered into the FX Option Contract and will always be a Spot Contract. If a bought FX Option Contract is in the money at Expiry Date, it will be automatically exercised and settled in accordance with your selected exercise method. Example: Assume your Trading Account Currency is NZD. The current Underlying Exchange Rate of NZD/USD is 0.7200. You enter into an FX Option Transaction by purchasing an out of the money Cash Settled Call Option on NZD/ USD at an Exercise Rate of 0.7300 for an underlying Notional Value of 100,000. The bid/ask price of the FX Option at the time is 0.0032/0.0040 so you would purchase the FX Option at an ask price of 0.0040 at a Premium of US$400 (0.004 x 100,000). The FX Option Expiry Date is in exactly one months time. At Expiry Date, the Underlying Exchange Rate is at 0.7500 and the bid/ask price is 0.010/0.016, so you exercise the Call Option. The resulting gross profit on Cash Settlement on the FX Option Transaction would be US$2,000 being the difference between the Underlying Exchange Rate at exercise (0.7500) less Exercise Rate (0.7300) x 100,000 (or $1,600 net of the initial $400 Premium charged). This amount would be credited to your Trading Account. There are no fees for exercising the FX Option. The example above is for illustrative purposes only. It provides an example of one situation only and does not reflect the specific circumstances or the obligations that may arise under a derivative you enter in to. For additional trade examples please refer to Halifax NZ s FX Trading Examples Booklet found on Halifax NZ s website at http://www.halifaxonline.co.nz/support/disclosure-documents. 2.5.7. Closing Out FX Option Contracts prior to the Expiry date An FX Option Contract can be Closed Out prior to the Expiry Date so as to realise any unrealised gains or losses: a. For a bought FX Option Contract: If you have bought an FX Option Contract, you can Close Out your position by selling an equivalent FX Option Contract to Halifax. Your Trading Account will then be credited with the value of the Premium for the sold FX Option Contract at the time of Closing Out. You may make a gross profit on the Transaction if the value of the Premium for the sold FX Option Contract is greater than the value of the Premium that you initially paid to buy the FX Option Contract (subject to any fees, charges and other amounts payable as outlined in section 4 of this PDS). You will incur a loss on the Transaction if the value of the Premium for the sold FX Option Contract is less than the value of the Premium that you initially paid to buy the FX Option Contract. b. For a sold FX Option Contract: If you have sold an FX Option Contract, you can Close Out the position by buying an equivalent FX Option Contract from Halifax. Your Trading Account will be debited with the value of the Premium for the bought FX Option Contract at the time of Closing Out. You may make a gross profit on the Transaction if the value of the Premium for the bought FX Option Contract is less than the value of the Premium that you initially received to sell the FX Option Contract (subject to any fees, charges and other amounts payable as outlined in section 4 of this PDS). You will incur a loss on the Transaction if the value of the Premium for the bought FX Option Contract is greater than the value of the Premium that you initially received to sell the FX Option Contract. Under certain conditions, it may become difficult or impossible for you to Close Out an FX Option Contract. For example, this can happen when there is a significant volatility in the level of the Underlying Instrument. 2.6 Key benefits of FX Products Margin FX and FX Options provide a number of benefits which must be weighed against the risks of using them. The benefits of Margin FX and FX Options are as follows: a. Hedging: You can use Margin FX and FX Options to hedge your exposure to the Underlying Instruments. b. Speculating: You may take a view on a particular Underlying Instrument and invest in our Margin FX and FX Options according to this belief. c. Tailored: OTC contracts (such as the FX Margin and FX Options offered by Halifax) are not standardised and can be personally tailored to suit your requirements. For example, Halifax allows you to enter into FX Margin and FX Option Transactions in small amounts whereas exchange traded products have a minimum transaction size based on a dollar value. 7 HALIFAX NZ

d. Profit potential in both rising and falling markets: Since Exchange Rates are constantly moving, there are always trading opportunities, whether a particular currency or precious metal is increasing or decreasing relative to another currency. There is the potential for profit (and loss) in both rising and falling markets depending on the strategy you employ. e. Leverage: Margin FX and FX Option Transactions involve a high degree of leverage. These products enable a client to outlay a relatively small amount (in the form of the Initial Margin) to secure an exposure to the movements in the value of the Underlying Instrument without having to pay the full price of actually acquiring the Underlying Instrument. 2.7 The capacity in which Halifax acts Margin FX and FX Options are negotiated and entered into between you on one hand and Halifax as principal on the other hand. This is a counterparty relationship, which means that any positions you choose to open with Halifax can only be Closed Out with Halifax. We hedge 100% of our exposure to you under every Transaction. This means that for each Transaction you enter into with us, we will hedge our exposure to you by entering into an equivalent matching transaction with a Platform Counterparty. 2.8 Margin Obligations Margin FX and FX Options are subject to margin obligations i.e. clients must have sufficient Net Free Equity in their Trading Account for security and margining purposes. You are responsible for meeting all margin obligations. 2.8.1 Types of Margin There are two components of the Margin Requirements which you may be required to pay in connection with Margin FX and FX Option Transactions; Initial Margin and the Variation Margin. 2.8.2 Initial Margin In order to enter into a Margin FX Transaction or FX Options Transaction (where applicable) you will be required to pay us the Initial Margin or have an amount of Net Free Equity in your Trading Account that is at least equal to the Initial Margin. The Initial Margin represents collateral for your exposure under the Transaction and covers the risk we take on you. Depending on the particular Margin FX or FX Option Transaction, the market volatility for the Underlying Instrument and the Trading Platform you use, the Initial Margin for a Margin FX Transaction or FX Option (where applicable) will typically be between 1% and 50% of the Notional value of the Margin FX Transaction or sold FX Option. However, it is not uncommon for Initial Margins to be above this range. We may, in our sole discretion and without the need to notify you, change the percentage Margin Requirements for a Trading Platform from time to time. Margin Requirements differ depending on the Trading Platform you choose. In choosing a Trading Platform, you should carefully consider the Margin Requirements of each Trading Platform as Margin Calls could have an adverse impact on your investment. 2.8.3 Variation Margin As the value of your Margin FX or FX Options will constantly change due to changing levels of the Underlying Instrument, the Margin Requirement (being the minimum Net Free Equity you must maintain in order for us not to Close Out some or all of your Margin FX Transactions) required to keep your positions open will also constantly change. This is commonly referred to as Variation Margin. The amount of your Margin Requirements (being the Initial Margin and any adverse Variation Margin) at any one time will be displayed on the open positions report made available through your Trading Platform. Any adverse price movements in the market must be covered by further payments from you (unless you already have sufficient Net Free Equity in your Trading Account). We will also credit the Variation Margin to your Trading Account when a position moves in your favour. HALIFAX NZ 8

We determine the Variation Margin for a Margin FX Transaction and FX Option Contracts by reference to changes in the value of the Underlying Instrument. In other words, each contract is effectively marked to market on at least a daily basis. Marked to market means that an open position is revalued generally in real time or at least on a daily basis to the current market value. The difference between the real time/current day s valuation compared to the previous real time/day s valuation respectively is the amount which is debited (in the case of unrealised losses) or credited (in the case of unrealised profits) to your Trading Account. The valuations are calculated using the closing value (at the close of trading on each day) of the Underlying Instrument as determined by the relevant Pricing Source. Intraday marked to market revaluations will be based on the last available value of the Underlying Instrument as determined by us in our sole discretion. Margin Calls are made on a net Trading Account basis i.e. should you have several open positions with respect to a particular Trading Platform, then Margin Calls are netted across the group of open positions. In other words, the realised and unrealised profits of one Transaction can be used or applied as Initial Margin or Variation Margin for another Transaction. It is your responsibility to monitor your Variation Margin obligations. Any notification of a Margin Call will be via a pop up screen or screen alert which you will only receive notice of if you access your online Trading Account via your Trading Platform s website. There may be instances where we do not provide you with a Margin Call notifying you of an obligation to meet a Variation Margin. This does not waive your obligation to meet that Variation Margin. If you fail to meet a Variation Margin we may in our absolute discretion (but without an obligation to do so) Close Out, without notice, all or some of your open Transactions. 2.8.4 Failing to meet a Margin Call If you do not meet Margin Calls immediately, some or all of your positions may be Closed Out by Halifax without further reference to you. Halifax generally applies risk limits (referred to as Default Liquidation Thresholds) to ensure that the percentage of your Trading Account balance which you are using at any one time to satisfy Margin Requirements (Margin Utilisation) does not exceed certain pre-defined levels. If your Margin Utilisation exceeds the Default Liquidation Threshold for your Trading Platform, a Margin Call will generally be applied to your Trading Account. If you do not meet a Margin Call immediately, we may Close Out some or all of your open Transactions without notice to you. The Default Liquidation Threshold is determined by the Platform Counterparty for your Trading Platform. It is implemented for risk management purposes, and may be varied by the Platform Counterparty at any time. Refer to Schedule 1, Annexure A of the Other Material Information document on the Disclose Register for the Default Liquidation Thresholds of each Trading Platform. If you fail to meet a Margin Call, then we may in our absolute discretion (but without an obligation to do so) Close Out, without notice, all or some of your open Margin FX Transactions and FX Option Contracts and deduct the resulting realised loss from your Trading Account. You may be required to provide additional funds to us if the balance of your Trading Account is insufficient to cover these losses. If a Close Out occurs you will not be able to enter into another Transaction until you transfer additional funds to us. 2.8.5 How Margin Calls are to be met When we make a Margin Call you must immediately transfer the amount of funds that we request into our nominated Client Trust Account. All funds received from clients are held, used and withdrawn in accordance with our Client Services Agreement and applicable New Zealand laws. All interest that may accrue on any positive balance in your Trading Account will be kept by us, unless we otherwise agree with you. 2.8.6 How to deposit money with Halifax You will only be permitted to deal in and maintain open Transactions on the basis of cleared funds being provided to meet your Margin Requirements. It is your responsibility to provide the funds for your margin obligations on time. You should bear in mind accepted New Zealand banking practice in relation to fund transfers or deposits from other financial institutions, which typically require three business days clearance for personal cheques and one business days clearance for direct deposits (depending on the timing of your transfer). Any delay in crediting your Margin Requirements is at your risk. 9 HALIFAX NZ

In practical terms, you also need to know and prepare yourself for the methods of depositing money in response to a Margin Call as this may determine whether some or all of your open positions are Closed Out. Some of the methods for depositing money in response to a Margin Call that can be used by you are as follows: a. Real time gross settlement (RTGS): This is an immediate transfer of cleared funds which may or may not be available at the institution that you bank with. b. Electronic transfer of funds (ETF): This is a transfer of funds that in most instances if lodged with a New Zealand bank, will be placed as cleared funds usually within the next business day with Halifax, but can be delayed through various external factors outside of yours or Halifax s control. c. International electronic transfer of funds (IETF): This is a transfer from an overseas bank that in most instances if lodged with an overseas bank will be placed as cleared funds usually within five business days, but can be delayed through external factors outside of yours or Halifax s control. d. Bank cheque: This is a cheque that is issued by a bank that traditionally requires three business days or more to clear and would be required to be deposited with a special answer to be made available as cleared funds the following business day (if required), but can be delayed through external factors outside of yours or Halifax s control. e. Business cheque and personal cheque: This is a cheque that is issued by a business or person that traditionally requires three business days or more to clear and would be required to be deposited with a special answer to be made available as cleared funds the following business day (if required), but can be delayed through external factors outside of yours or Halifax s control. If Halifax receives confirmation of RTGS and ETF, Halifax will determine this as cleared funds. Unfortunately, as IETF, bank cheques, business cheques and personal cheques can be cancelled or withdrawn, Halifax will need to assess on a case by case basis whether this method of deposit is appropriate or, alternately if cleared funds will still need to be provided by you. Whilst RTGS or ETF facilities may imply an immediate transfer of funds, you should also be aware that these processes can take additional time which could have some impact on your ability to trade and to control your open positions while the funds are waiting to be cleared. We recommend that you clarify with your bank or financial institution what timeframes or delays may be experienced when transferring funds via RTGS or ETF facilities to Halifax. Credit cards may not be used to open or trade on your Trading Account at any time. We also do not accept other financial products as collateral for opening or trading on your Trading Account. You should be aware that timing delays in your ability to transfer funds to us could affect your ability to satisfy a Margin Call in time, which could result in us Closing Out an open a Margin FX Transaction. 2.9 Entering into, altering and terminating FX Products 2.9.1 Opening an account and getting a Trading Account To open a Trading Account, you must firstly contact us either by using the contact details in section 6 of this PDS or by completing an account application and account opening form which can be located on our website at http:// www.halifaxonline.co.nz/getting-started/. You will also need to execute a Client Services Agreement, which forms part of the account application. The Client Services Agreement sets out the general terms of your dealings with us for the financial products covered by this PDS and also for dealings not covered by this PDS (such as trading in other financial products offered by Halifax). Once you have completed the account application and have opened a Trading Account with us, you may deposit funds in your Trading Account by using one of the methods described in section 2.8.6 of this PDS. Once funds have been deposited in your Trading Account and are cleared, you may then place an order (i.e. provide an instruction to either open or Close Out a Margin FX Transaction). 2.9.2 Cooling off arrangements and altering the terms of Margin FX and FX Options There are no cooling-off arrangements for the Margin FX or FX Options offered by Halifax. This is consistent with other product issuers in similar products. This means that when you enter into a Margin FX or FX Option Contract with Halifax, you do not have the right to return the product, or request a refund of the money paid to acquire the product. Should you change your mind after entering into the Transaction with Halifax you should Close Out your position by entering into an opposite transaction (although loss may be incurred in doing so). HALIFAX NZ 10

2.9.3 Opening and Closing Out a Margin FX or FX Option Transaction Orders to open a position can be given through your chosen Trading Platform or by contacting us within business hours. We are not obliged to accept orders from you. For example, we may refuse to accept orders from you if: a. there is insufficient Net Free Equity in your Trading Account to meet your Margin Requirements (for more information about your margin obligations see section 2.8 of this PDS); b. we are unable to quote values in the relevant Underlying Instrument due to the unavailability of information from the relevant exchange or Pricing Source (as applicable) on which the Underlying Instrument is traded; and c. there are problems with systems, the website or Trading Platform (see risks in section 3 of this PDS). Once you have entered an order into one of the Trading Platforms, the system will automatically report the main elements of that order to you in a pop up window or in the trade log. This is a preliminary notification and provides you with a quick reference point for your trade and it will enable you to print a confirmation of the primary data, including the quantity, price, and the date and time the order was transmitted to us. Once your order has been executed you can obtain a comprehensive trade confirmation by accessing the daily statement on your Trading Platform. It is your obligation to review any confirmation immediately to ensure its accuracy and to report any discrepancies within 48 hours. 2.9.4 Adjustments Under the Client Services Agreement, we have the right to decide to make an adjustment in a number of circumstances if we consider an adjustment is appropriate. Our right to make an adjustment to your open position, as well the circumstances in which we may make an adjustment are set out in the Client Services Agreement. 2.9.5 Close Out and Expiry See sections 2.5.4 and 2.5.7 of this PDS for further information regarding the Close Out and the expiry of the Margin FX and FX Option Contracts (respectively). 2.10 How Margin FX and FX Option Contracts are traded 2.10.1Trading Platforms Halifax enables its clients to trade Margin FX and FX Option Contracts using Trading Platforms. Each client must select a Trading Platform as part of the account opening and application process. You should carefully consider which of the Trading Platforms is likely to best meet your needs. Before you enter into a Margin FX and FX Option Contracts you should open a demo account and conduct simulated trading. This enables you to become familiar with the attributes of the various online Trading Platforms. It is important to note that there are significant and fundamental differences between each Trading Platform. These differences include the following: a. The nature of the online interface through which you can transact and monitor your Trading Account. b. The Underlying Instruments over which you can enter into a Transaction. c. The credit risk you take on the Platform Counterparty for your Trading Platform. d. The fees and costs you are charged for the Transaction. You can change Trading Platforms at any time by contacting us. You can also choose to use one of the other Trading Platforms. An open position however cannot be transferred from one Trading Platform to another. The Trading Platforms that we use, and the Platform Counterparties that operate those Trading Platforms, are set out below. We encourage you to review the website of each Trading Platform to an understanding of how they each operate. 11 HALIFAX NZ

Trading Platform Platform Counterparty Web address to access Trading Platform Halifaxonline Saxo Capital Markets (Australia) Pty Ltd http://www.halifaxonline.co.nz/platforms/halifax-online/ or au.saxomarkets.com MetaTrader4 GAIN Capital Holdings, Inc http://www.halifaxonline.co.nz/platforms/trader-workstation/ Trader Work Station Interactive Brokers LLC http://www.halifaxonline.co.nz/platforms/metatrader4/ or www.interactivebrokers.com 2.10.2 Trading Hours Our Trading Platforms operate 24 hours a day with the foreign exchange markets normally opening at 3 a.m. New Zealand time and closing on Friday at 5 p.m. New York time (10 a.m. Saturday morning New Zealand time). This means that you are able to view live prices and place orders through the Trading Platform during these hours. Outside these hours, you may still access the Trading Platforms and view your Trading Account, market information, research and our other services. However, there will not be any live prices or trading. It is at the sole discretion of Halifax to provide services to you outside these trading hours. Any changes to trading hours will be displayed on our website at www.halifaxonline.co.nz. 2.11 Trading Examples When trading Margin FX and FX Options offered by Halifax, you should be aware of the risks and benefits and review examples of how Margin FX and FX Options can be traded. Halifax has prepared various trading examples which can be found on our website at http://www.halifaxonline. co.nz/support/disclosure-documents. 3. Risks of these derivatives 3.1 Product risks 3.1.1 Changes in the price, value or level of the Underlying Instrument Trading in the Margin FX and FX Options involves a high degree of risk. It is important that you carefully consider whether trading our products is appropriate for you in light of your investment objectives, financial situation and needs. If there is an adverse change in the value of the Underlying Instrument, you will be required to transfer additional funds immediately to us in order to maintain your position i.e. to top up your Trading Account balance. Those additional funds may be substantial. If you fail to provide those additional funds immediately, we may Close Out some or all of your open positions. You will also be liable for any shortfall in your Trading Account balance following that closure. This shortfall may, in some instances, be substantial. You should be aware that the risks you face differ depending on which Trading Platform you choose to trade through. In particular, you will take credit exposure not only on us, but also on the Platform Counterparty with which we enter into Hedge Transactions in respect of your Trading Platform. Therefore, you should make your own assessment of both our ability to perform our obligations under the Margin FX or FX Option Transaction and the relevant Platform Counterparty s ability to meet its obligations under the corresponding Hedge Transaction. HALIFAX NZ 12

3.1.2 Other variables that lead to losses for clients The following is a description of some of the other significant risks associated with trading Margin FX and FX Options offered by us. a. Incorrect details are entered: If you incorrectly place your intended order you are responsible for the result of the incorrectly placed order, including all costs to close out the position and any resulting profit or loss on the outcome. b. Exercise of our discretion to Close Out: We have absolute discretion to Close Out a client s open positions at values we determine. The effect of us exercising our discretion is that we may Close Out your open position and you may suffer loss as a result (including actual loss or opportunity loss if the value improves from the value the open position was Closed Out). We are not responsible for any such loss. c. Order acceptance risk: When you place an order (i.e. request to open or Close Out a position), we have an absolute discretion whether or not to accept and execute such request. The effect of our discretion is that an order you give may not be executed and you may suffer loss (whether it be actual loss or an opportunity loss) as a result. We are not responsible for such loss. d. Substantial losses: Stop loss orders are often used to attempt to limit or minimise the amount which can be lost on an open Transaction. Stop loss orders may not always be filled and, in any event, may not limit your losses to the amounts specified in the order. e. Market conditions: Under certain market conditions it could become difficult or impossible to manage the risk of open positions by entering into opposite positions in another contract or to Close Out an existing position. Market conditions may also mean that the price of Margin FX and FX Options may not maintain their usual relationship with the value of the Underlying Instrument. f. Exchange Rate risk: In instances where you trade in a Margin FX or FX Options based on an Underlying Instrument priced in a currency other than your Trading Account Currency, your profit or loss will be determined by movements in the value of the Underlying Instrument and also by the impact of movements in the Exchange Rate. Adverse Exchange Rate movements could cause you to incur significant losses. g. Liquidity: Under certain conditions, it may become difficult or impossible for you to Close Out a position. This can, for example, happen when there is a significant change in the Underlying Instrument over an extremely short period of time. h. Platform Counterparty: You will take on credit exposure not only on us, but also on the Platform Counterparty with which we enter into Hedge Transactions in respect of your Margin FX and FX Option Transactions. This means that our obligations to you are linked to the performance by the Platform Counterparty of its obligations under the Hedged Transaction. If the Platform Counterparty fails to perform its obligations under the Hedged Transaction our obligations to you for your corresponding Margin FX or FX Option Transaction will be reduced accordingly. If the Hedging Counterparty becomes insolvent, you might lose some or all of the balance of your Trading Account (even though we might continue to be solvent). You also might face considerable delays before you are able to access the amount (if any) that is able to be recovered from the Platform Counterparty. Therefore, you should make your own assessment of both our ability to perform our obligations under the Margin FX or FX Option Transaction and the relevant Platform Counterparty s ability to meet its obligations under the corresponding Hedge Transaction (see section 5.2 of this PDS for more information). i. Co-mingling of client monies: Funds paid to Halifax by you are first deposited into a Client Trust Account maintained by Halifax. This means that client funds (and property) deposited with us are held in safe keeping and segregated from our own funds (or property). Client monies are held, used and withdrawn in accordance with this PDS and our Client Services Agreement. This means that those funds are not available to pay general creditors in the event of receivership or liquidation by Halifax. For money deposited in our Client Trust Account, you should be aware that individual client accounts are not separated from each other and all clients funds are co-mingled in the one Client Trust Account. 3.1.3 The consequences of a failure by the investor to make a payment or delivery If the level of the Underlying Instrument moves against your position, you will be required to have sufficient Net Free Equity your Trading Account to meet your Margin Requirement in order to maintain your position. The amount of funds required may be substantial. If you fail to pay us immediately, your position may be Closed Out at a loss and you will be liable for any shortfall. 13 HALIFAX NZ

3.1.4 The consequences of altering the terms of a derivative or terminating a derivative Under the Client Services Agreement, we have the right to decide to make an adjustment in a number of circumstances where we consider an adjustment is appropriate. We have a discretion to determine the extent of the adjustment so as to place the parties substantially in the same economic position they would have been in had the event giving rise to the need for the adjustment not occurred. 3.2 Issuer risks Given you are dealing with us as counterparty to every Margin FX and FX Option Transaction, you will have an exposure to us in relation to each of those Margin FX and FX Option Transactions. You should review our financial accounts (available on request) to assess our ability to meet our financial obligations. As an investor in the derivatives offered under this PDS, you will be exposed to the risk that we become insolvent and are unable to meet our obligations under the derivative. If we become insolvent, then we may be unable to meet our obligations to you in full or at all. Any funds you transfer to us may not be protected. Halifax s creditworthiness has not been assessed by an approved rating agency. This means that Halifax has not received an independent opinion of its capability and willingness to repay its debts from an approved source. 3.3 Risks when entering or settling the derivatives There are a number of significant risks that arise from the processes by which the derivatives are entered into or settled, including risks associated with using internet-based Trading Platforms. Such risks include, but are not limited to: a. risks related to the use of software and/or telecommunications systems such as software errors and bugs; b. delays in telecommunications systems; c. interrupted service; d. data supply errors; and e. faults or inaccuracies and security breaches. A disruption to a Trading Platform could mean you are unable to trade in Margin FX and FX Option Contracts and that you may suffer a financial loss or an opportunity loss as a result. 4. Fees Fees and charges will be charged to your Trading Account at the time the Transaction is entered into and Closed Out and, for open positions, through daily adjustments to your Trading Account. The fees and charges you are required to pay will vary depending on a number of factors, including the following: a. Trading Platform: The Trading Platform that you use. b. Agreed terms: The terms agreed between you and us at the time of entering into the Transaction. 4.1. Spread - Halifaxonline, and MetaTrader4 For Halifaxonline and MetaTrader4 (together, the Spread Platforms) the commission you pay is built into the Spread that we apply on the Exchange Rates that we offer to you to enter into or Close Out of FX Transactions and Metal Transactions. Unless otherwise negotiated, we may charge you a minimum transaction fee of up to US $10 to enter into or Close Out a Margin FX Transaction in addition to the Spread if the minimum trade threshold is not surpassed (see Schedule 1, Annexure B of the Other Material Information document on the Disclose Register for further information on the minimum trade thresholds). The Spread is the difference between the bid price (the price at which you can sell) and the ask price (the price at which you can buy) for the Base Currency as against the Terms Currency as quoted on your Trading Platform. HALIFAX NZ 14

The Spread reflects the total round trip costs for opening and Closing Out a Transaction on a Spread Platform (other than any Rollover charges or conversion costs that might be applied). The Spread we apply to the Exchange Rates that we offer in respect of a Transaction is comprised of the Spread incorporated into the Exchange Rate offered to us by the Platform Counterparty for your Trading Platform and the Platform Counterparty s profit. Schedule 1, Annexure C of the Other Material Information document on the Disclose Register sets out the target Spreads for each Trading Platform under normal market conditions. Where there are unusual market conditions or volatility these Spreads can increase without notice. You can assess the Spread prior to entering into or Closing Out any Margin FX Transaction by comparing the bid and ask Exchange Rates offered through your relevant Trading Platform. 4.2. Commission - Trader Work Station For the Trader Work Station, you will be charged a commission fee for each Margin FX Transaction you enter into calculated as a percentage of the Notional Value for your Transaction (expressed in your Trading Account Currency) with a fixed minimum charge. The commission charge is applied both when you enter into the Transaction and when you Close Out your Transaction. In contrast to the Spread Platforms, no profit or commission will be incorporated into the Spread on the Exchange Rates we offer to you to enter into and Close Out each Margin FX Transaction by either Halifax or the relevant Platform Counterparty. Schedule 1, Annexure C of the Other Material Information document on the Disclose Register sets out our commission rates for each Underlying Exchange Rate. 4.3. Rollover on open Margin FX Transactions If you hold an open Margin FX position overnight, a Rollover amount will be debited or credited to your Trading Account. The Rollover amount will be calculated as at 5:00 p.m. New York time each weekday. It is calculated as the product of the Notional Value of the open Margin FX Transaction multiplied by the difference between the interest rate on the Long Currency and the interest rate on the Short Currency, in each case as determined by Halifax, (converted to your Trading Account Currency). Whether a negative Rollover amount is debited to your Trading Account or a positive Rollover amount is credited to your Trading Account will depend on whether the Long Currency or Short Currency in your Currency Pair or Metal Pair has the higher interest rate. If the interest rate on the Long Currency is higher than the interest rate of the Short Currency, then the Rollover amount will be positive (positive roll) and will be credited to your Trading Account. By contrast, if the interest rate on the Long Currency is lower than the interest rate on the Short Currency, then the Rollover amount will be negative (negative roll) and will be debited from your Trading Account. Halifax uses variable interest rates to calculate Rollover amounts, which vary for each currency. In determining the interest rates on the Long Currency and the Short Currency, Halifax will generally apply the same interest rates as the rates determined by the Platform Counterparty for your Trading Platform in respect of the Hedge Transaction and may charge an additional Spread of up to 175 basis points on top when calculating the Rollover amount. This will reflect the interest rates in each currency at which the Platform Counterparty can borrow and lend plus a Spread (if any) charged by the Platform Counterparty and Halifax at its discretion. If you hold an open position on the last relevant trading day before a day on which the market is not open for trading (i.e. if you hold an open position on a Friday, or the last day before a public holiday in the relevant jurisdiction), your daily Rollover amount will be increased to account for the non-trading days before the relevant market opens. The rollover arrangements vary for each Trading Platform. Schedule 1, Annexure D of the Other Material Information document on the Disclose Register sets out more detailed information concerning the Rollover arrangements that apply to each Trading Platform. You should carefully read and consider this information. 15 HALIFAX NZ