General Information

Please read this Agreement carefully and seek professional advice if necessary. Contracts that we enter into with you under this Agreement are legally binding and enforceable. By signing the Application form or by electronically submitting your application on our website you confirm that you accept the terms of the Agreement. When we open an account for you, you will be bound by the Agreement in your dealings with us.

No Personal Financial Advice

We will not provide any personal or financial product advice to you in relation to the terms and conditions of this Agreement or on the merits of any trade. We deal with you on an execution-only basis and any advice we give you will be general advice only. This means that any advice we do give you has been prepared without taking account of your objectives, financial situation, or needs. In the circumstances, you should seek professional advice as to whether the financial products that we offer are suitable for your purposes having regard to your objectives, financial situation, or needs.

All Trades at Your Risk

We may, but are under no obligation: To satisfy ourselves as to the suitability of any trade for you; To monitor or advise you on the status of any trades; To make margin calls; or except where legislation requires it, close any open position despite the fact that previously we may have given such advice or taken action in relation to that trade or any other.

Reliance on Your Own Judgement

You must understand the risks of dealing in online trading and rely solely upon your own judgement in dealing with us. We are not under any responsibility or owe to you any duty of care to monitor your trades or to prevent you from trading beyond your means or ability or otherwise to protect you.

Our Trading Service

Our trading service is an online service and you specifically consent to the receipt of documents in electronic form via email, website, or other electronic means.

Our Discretions

Various clauses of this Agreement confer discretions on us to act in circumstances that are set out in the relevant provision.

Opening an Account

After we accept your application we will open an account in your name. We may split your account into different sub-accounts denominated in different currencies and references in this Agreement to your account are to be taken to include reference to sub-accounts or the relevant sub-accounts as the case requires. We reserve the right to refuse to open an account for any reason whatsoever.

Account Information

You undertake and warrant to us that any information provided to us is correct and that you will immediately inform us of any material change to that information and including any changes to your contact details or financial status.

Trust Account

All moneys deposited by you to the credit of your account is client money within the meaning of the client money handling obligations and which will be held in an account in accordance with the client money obligations. Client money is held in trust for the clients entitled to it or if the money is invested in accordance with the client money obligations the investment is held in trust for clients entitled to it.

Account Details

Upon opening an account with us you will be given an internet-specific password which must be declared together with your account number when you wish to access your account. You will also be given an account name which must also be declared to access your account in certain circumstances. It is your responsibility to keep your account number and security information confidential and agree that you will not disclose your account number or password to any other

person. You will be deemed to have authorized all trading under your account number irrespective of whether the person using it for the purpose of trading is using it with your authority unless the trade in question is not one that you in fact authorized directly or through a power of attorney; and The person using the account number obtained it from us as a result of our negligence OR We otherwise act negligently in accepting instructions on your account.

Instructions & Dealings

By Telephone: When you trade by telephone your instructions to open or close a trade must be given to our trader during the same telephone conversation in which the quote was given. We have no liability to you if this telephone conversation is interrupted before we receive an instruction from you to trade on that quote; nor are we under any obligation to repeat the quote in a subsequent conversation. We will not accept an order left with other employees on an answering machine or on a voice mail facility.

Account Security Information

You are required to keep all security information relating to the account including but not limited to any user name, account number, user id, and password confidential and we do not have to establish the authority of anyone using these items. If you are aware or suspect that these items are no longer confidential you should contact us as soon as practicable so that they may be changed.

Right Not to Accept Orders

We may but shall not be obliged to accept instructions to enter into a transaction. If we decline to enter into a proposed transaction we shall not be obliged to give a reason but we shall promptly notify you accordingly.

Correct Designatin

It is your responsibility to ensure that money sent to us is correctly designated in all respects including where applicable that the moneys are by way of margin and to which of your accounts they should be applied. We will provide you from time to time with details of such arrangements as may apply to making payments to us which may include permitting payments in different currencies as notified by us to you.

Consent to Recording of Telephone Conversations

You consent to the electronic recording of your telephone discussions with us with or without an automatic tone warning device; and The use of recordings or transcripts from such recordings for any purpose including but not limited to their use as evidence by either party in any dispute between you and us.

Operating Your Account

Charges & Fees You Pay: You agree to pay the charges and fees and receive the benefits set out in this Agreement or as otherwise advised from time to time. You agree that the fees and charges are subject to change and it is your responsibility to ensure that you are familiar with how the fees, charges, commission, and other payments are calculated. You also agree to pay interest in respect of any unpaid amount due under this Agreement at a rate equal to three percent per annum over the cash rate (or of such monetary authority as may replace it). Such interest accrues and is calculated daily from the date payment was due until the date you pay in full and is compounded monthly.

Interest on Account

The company shall not be obliged to pay interest to the customer on any funds which the company holds. The customer waives all rights and entitlements to interest earned on the account.

Commissions

Other than in the limited circumstances as disclosed we do not receive commissions.

Timing of Credits Deductions or Fees which you are to pay from your Account

Any charges will be deducted from your account the day following the day on which the charges were incurred and benefits will be paid the day on which it was derived. If a position is closed at a loss that loss will immediately be deducted from your account and your available trading resources will be adjusted accordingly. If a position is closed at a profit that profit will immediately be credited to your account and your available trading resources will be adjusted accordingly.

Incorrect Crediting of Account

Limitation of liability: except in the case of our fraud we do not accept responsibility for nor are we liable for any loss or damage suffered by you as a result of you trading on moneys deposited in or credited to your account in error by or upon behalf of us. Permitted deductions: we are entitled at any time to deduct without notice or recourse to you any moneys deposited in or credited to your account in error by or on behalf of us.

Opening a Trade

Opening a trade using our Trading Platform: You will be able to open or close a position and execute limit orders and stop-loss orders on a trade opened with us via our trading platform. We will have no liability to you if any internet connection is lost with the result that you are unable to trade at any given price.

We do not warrant that the trading platform will always be available or accessible when the exchanges on which the underlying instruments in respect of which you have traded or wish to trade are open and we reserve the right to remove altogether or reduce the trading platform service at any time for any purpose without thereby incurring any liability to you.

If our computer records are at variance with your own records or recollection of your trading the version of events recorded contemporaneously by our computer will prevail and our obligations to each other (including the obligation to pay any money) will be assessed and calculated on the basis that our contemporaneous computer records are correct and are conclusive evidence of the matters they record.

Profit & Losses

You further understand that a payment will pass between us equal to the difference in value expressed in US dollars between the opening price of all positions and their closing prices. If you make a profit we must pay a sum to you equal to that profit. If you make a loss you must pay to us a sum equal to that loss.

Events of Default

What Constitutes an Event of Default: The following constitute events of default which upon their occurrence give us the right to take action in accordance with Clause 7.2:

• An insolvency event occurs in relation to you;
• You are an individual and you die or become of unsound mind;
• You fail to fulfill any obligations advised by us;
• You are in breach of any warranty or representation made under this Agreement and/or any information provided to us in connection with this Agreement is or has become untrue or misleading;
• Any fee due to us is not paid in accordance with this Agreement;
• Whether or not any sums are currently due to us from you where any cheque or other payment instrument has not been met on first expectation or is subsequently dishonored or you have consistently failed to pay any amount owed to us in time;
• At any time or for any period deemed reasonable by us you are not contactable or you do not respond to any notice or correspondence from us;
• We reasonably consider that there are abnormal trading conditions;
• We reasonably consider it necessary for the protection of our rights under this Agreement;
• We consider that you may be in breach of any applicable

What Actions May We Take?

If an event of default occurs we may take all or any of the following actions:

 

• Immediately require payment of any amount you owe us including margin;
• Terminate this Agreement;
• Close all or any of your open positions;
• Limit the size of your open positions either in monthly terms or a number of margins;
• Refuse orders to establish new positions;
• Convert any ledger balances to the base currency of your account;
• Exercise our rights of set off against (including but not limited to) the funds held on your behalf in the segregated client account;
• Change the margin level at which we may close your account;
• Impose new margin requirements to your trading or account;
• Limit or withdraw the credit on your account;
• Suspend your account and refuse to execute any trades;
• Call on any guarantee in respect of your obligations;
• Combine close or consolidate any of the accounts sustained by you and offset any and/or amounts owed to or by us in such manner as we may in our absolute discretion determine;
• Retain any amount owed by us to you against any contingent liability of yours to us or as long as the contingency subsists; or
• Exercise any power or right that we may have in accordance with this agreement or in law or equity or take any other form of action.

Additional Closing Rights

We may also close your account at our discretion in the circumstances set out below. If we rely on our rights under this clause your account will be suspended during the 14-day notice period and you will not be able to place trades other than those to close existing open positions. If you have

not closed all the open positions within the 14 days’ notice we are entitled to take any action within this Agreement

The relevant circumstances are:

• Any litigation is commenced involving both of us in an adversarial position to each other and in view of the subject matter of or any issues in dispute in relation to that litigation we reasonably decide that we cannot continue to deal with you while the litigation is pending;
• Where you have persistently acted in an abusive manner toward our staff (for example by displaying what we consider to be serious discourtesy or the use of offensive or insulting language);
• Where we believe on reasonable grounds that you are unable to manage the risks that arise from your trades;
• Abuse

Our Rights to Close or Void

Without limiting our right to take action we may also close or void individual open positions and/or cancel any order. We reserve the right to close all or part of the open position in order to minimize the amount in any dispute; and/or there is a material breach of the agreement in relation to the open position.

Our Rights to Suspend Account

Without limiting our right to take action we may in our sole and absolute discretion suspend your account pending investigation for any reason. Whilst your account is suspended you will be able to close your open positions but you will not be entitled to place new trades. Circumstances in which we may choose to exercise this right include but are not limited to the following:

• When we have reasonable grounds for believing that an event of default has occurred or may occur but believe that it is reasonably necessary to investigate circumstances with a view to confirming this;
• When we have reasonable grounds for believing that you do not have a sufficient understanding of the trades which you are placing or the risks involved;
• When we have not received within 10 days of a written request all information which we believe that we require in connection with this Agreement;
• We have reason to believe that there has been a breach in your account share or that there has been a threat to your account share; or
• We have reason to believe that it is necessary for us to comply with any regulatory

Conclude Investigations

If we have suspended your account pending investigation we will use reasonable endeavors to conclude our investigation within five (5) business days. When we conclude our investigation we will inform you whether trading on your account may resume or whether we will seek to take further action pursuant to this Agreement.

Exercise of Rights

We may exercise our rights under this Clause 15 at any time after the relevant event has occurred and where relevant will do so on the basis of the next available price for the affected open position as determined under Clause 12.5.

Netting and Setting Off

At any time following the occurrence of an Event of Default we may by notice to you specify a date (the “Liquidation Date”) for the termination and liquidation of Netting Transactions in accordance with this Clause.

Payments

Your Payments must be of the Full Amount: When you make any payment which is subject to any withholding or deduction under this Agreement you must pay to us an amount that ensures that the amount actually received by us is equal to the full amount we would have received had no withholding or deduction been made.

Payments We Owe You & You Owe To Us Are Offset: If on any day the same amounts are payable under this Agreement in respect of the same account by either you or us to the other in the same currency then on such date each of our obligations to make payment to such amount will be automatically satisfied and discharged. On the other hand, if the aggregate amount that is payable by one of us exceeds the aggregate amount that is payable by the other in the same currency then the one who has to pay the larger amount must pay the excess to the other and the obligations to make payment of each party will be satisfied and discharged.

Payment of Amounts Due to Us

Unless otherwise provided in this Agreement all amounts due to us will at our option:

• Be deducted from any funds held by us for you; or
• Be paid by you in accordance with this

You must pay all commissions, fees, and charges including administration fees, data fees, and rollover and financing charges, and other charges that may be levied by us from time to time in accordance with this Agreement. Goods and services tax will be added to the amount payable where relevant.

Termination

Your Right to Terminate: You may also terminate this Agreement or close your account at any time by giving us written notice. Your account will be closed as soon as reasonably practicable after we have received notice all open positions are closed or orders canceled and all of your obligations are discharged.

Reservation of Rights

If you or we provide notice to close your account or terminate this Agreement under this Clause we reserve the right to refuse to allow you to enter into any further trades or orders which may lead to you holding further open positions.

Survival of Obligations

Termination of this agreement will not release either party from their obligations or liabilities accrued prior to the termination of this agreement.

Legal & Regulatory Requirements

Despite any other provision of this Agreement in providing the services in this Agreement we will be entitled to take any action as we consider necessary in our absolute discretion to ensure compliance with all applicable laws. You hereby indemnify us against all liability including any claim, loss, expense, or cost incurred as a result of our actions under this clause.

You Agree to Comply with the Law: You agree strictly to comply with all applicable laws. If we reasonably consider you have not so complied we may terminate this Agreement immediately without notice.

Limitation of Liability

Reasonably Foreseeable Losses: Other than is described in this Agreement and subject to our limits on our liability in this Agreement we are each only responsible for losses that are reasonably foreseeable consequences of breaches of this Agreement are at the time the Agreement is entered into.

Indirect Losses: We are not responsible for indirect losses which occur as a side effect of the main loss and damage which are not foreseeable by you and us. We are not liable to you for losses which you incur which are foreseeable by us for the reason that you have communicated the possibility of such losses or any special circumstances to us.

Loss of Profit: We are not liable to you for any loss of profit or opportunity.

Application of Limitations: The limitations of liability in this Clause apply whether or not we or any of our employees or agents knew of the possibility of the claim being incurred.

You Agree to Indemnify Us

You agree continuously to indemnify us against all losses (including consequential losses), taxes, expenses, damages, charges, receipts, demands, and expenses of any nature and on any account and liabilities present, future, contingent, or otherwise and including legal fees on a full indemnity basis which may be suffered or incurred or brought against us or in connection with or caused by:

• Your breach of this Agreement;
• Us entering into any margin FX contract, FX option contract, or CFD;
• Us taking any action under Clause 12 of this Agreement;
• Any representation or warranty given by you being incorrect, misleading, or untrue or any error in any order or instruction which is or appears to be from an authorized person unless and to the extent only such is suffered or incurred as a result of our gross negligence or willful default.

Survival of Indemnity

The indemnity clause survives termination of this Agreement and any transaction under this Agreement.

Client Money

Client Money Rules & Authorisations: All money paid to us by you or a person acting on your behalf or which is received by us on behalf of you will be held by us in one or more segregated bank accounts. These moneys do not constitute a loan to us and are held on trust by us. You agree and acknowledge that individual accounts of our clients are not separated from each other within the segregated trust accounts operated by us. The customer agrees that in the event that there has been no movement on the customer’s trading account balance for a period of at least six (6) years (notwithstanding any payments or receipts of charges, interest, or similar items) and the Company is unable to trace the customer despite having taken reasonable steps to do so the Company may release any customer’s money balances from the segregated account.

Warranties, Representations, and Undertakings

Your Warranties: You undertake, warrant, and represent to us with the intention that the following undertakings, warranties, and representations are repeated each time you provide instructions to us:

• Legal disability: you are not under any legal disability and are not subject to any law which prevents you from entering this Agreement;
• Corporate authorization: if you are a company you are empowered by and have obtained all necessary corporate or other authorities under your constitution and at law;
• Consents: you have obtained all necessary consents and have the authority to consent to and enter into this Agreement which may be against us as a counterparty;
• Compliance with laws: you are complying with all laws to which you are subject;
• Able to pay debts: you are able to pay your debts as and when they fall due and are not otherwise insolvent or presumed to be insolvent under any law;
• No liquidator, etc.: no liquidator, provisional liquidator, receiver, receiver and manager, trustee, controller, official manager, administrator, or similar officer has been appointed in relation to your affairs and no application has been made for the appointment of any of these persons;
• Information accurate: at all times the information provided by you to us whether in the application form or otherwise will be complete, accurate, and not misleading in any material respect;
• Transactions: you will not conduct any transactions including trades which contravene laws or regulations in any transactions in relation to insider trading, market manipulation, or market abuse;
• Suitability: you fully understand the high risks associated and the potential for high profits with entering into the Transaction contemplated under this Agreement that you have obtained relevant taxation, legal, and other professional advice in relation to the Transactions;
• Risk Disclosure: you have read and understood the above risk disclosure, any other information, or disclosure statement issued by us in relation to the financial products and transactions relevant to the Account. You have been recommended to obtain appropriate independent financial advice prior to entering this agreement and in any case, you have

considered your own financial situation, objectives, and needs when you enter this agreement;

• Non-infringement: In executing and complying with this agreement you will not infringe any provisions of any other document or agreement you are a party to;
• Our services: you acknowledge and understand that we will not provide legal, tax, accounting, or personal financial advice to you as part of the services we provide you in accordance with this agreement;
• Acting as principal: you acknowledge and understand that we will be acting as principal in our relationship with you. Our directors, employees, and associates may and can deal on their own account in relation to your transactions;
• Extent of authority: We are not required to act in accordance with your instructions if in our opinion to do so would or could constitute a breach by it or its agent or counterparty of the Corporations Act or any other Applicable law.

Notification of Changes

You undertake that throughout the term of this Agreement you will promptly notify us of any change to the details supplied by you in your application form and any material or anticipated change in your financial circumstances which may affect the basis upon which we do business with you.

Dispute Resolution

Informing Us About Disputes: You should inform us immediately in writing of any dispute or difference whatsoever in connection with this Agreement. We will endeavor to investigate and resolve any dispute or difference in accordance with our internal complaints handling system.

How Disputes Are Dealt With: We are obliged to put in place internal procedures for handling complaints fairly and promptly. You may submit a complaint to us for example by letter, telephone, email, or in person. We will send you a written acknowledgment of your complaint promptly following receipt enclosing details of our complaints procedures including when and how you may be able to refer your complaint to an External Dispute Resolution party. Please contact us if you would like further details regarding our complaints procedures.

Governing Law & Courts

Parties agree that the Law of California shall be the governing law & courts & California shall have exclusive jurisdiction.

Authorization to Trade

Subject to the terms and conditions of this Agreement and acceptance of Customer’s application to open an account with the Company, Customer hereby authorizes Company to maintain one or more Accounts in Customer’s name and engage in transactions for Customer’s Account in accordance with oral, written, or electronic instructions by Customer and its officers, partners, principals, employees, or other agents (“Representatives”).

Customer will bear the risk of all unauthorized instructions by its Representatives and will indemnify and hold KCM harmless from all claims, liabilities, losses, damages, fees, costs, and expenses relating to or arising from KCM’s reliance on such instructions including any improper, unauthorized, or fraudulent instructions by the Representatives except in cases of gross negligence or willful misconduct by KCM.

Accounts

Account Approvals and Maintenance: KCM may reject a Customer’s application or close a Customer’s Account for any reason at KCM’s sole and absolute discretion. KCM may require the Customer to provide additional information or documentation for KCM to continue carrying the Customer’s Account. The Customer acknowledges that KCM may at any time in its sole and absolute discretion restrict trading, disbursements, or transfers. KCM may amend, change, revise, add or modify the Agreement at any time. The most current Agreement will be posted to KCM’s Website kanakmarkets.com. The customer understands that this Agreement cannot be modified by any verbal statements or written amendments that Customer seeks to make without written acceptance from the General Counsel of KCM.

Restricted Territory

We restrict and reserve the right to limit future access to all or some parts of the Website and/or Services in respect of certain jurisdictions. You fully understand and agree that we are not liable if the country of your location or residence becomes restricted or blocked. Restricted Territories include but are not limited to individuals residing in: Bahamas, Botswana, Burma (Myanmar), Cambodia, Democratic Republic of Congo, Cuba, Ethiopia, Ghana, Iran, Iraq, Japan, Libya, Malta, North Korea, Panama, Republic of the Congo, Somalia, Sudan, Syria, Trinidad and Tobago, Tunisia, Vietnam, Zimbabwe.

The Customer acknowledges and agrees that Accounts are segregated only in KCM’s books and records. Customer’s funds are not FDIC-insured and are deposited with a liquidity provider selected by KCM in its sole discretion.

Joint Account Owners

If this Account is held by more than one (1) person, all of the joint holders agree to be jointly and severally liable for the obligations assumed in this Agreement. Suppose this Account is held in trust, joint ownership, or partnership. In that case, the undersigned hereby agrees to indemnify, defend, and hold harmless KCM for any losses resulting from a breach of any fiduciary duty of the undersigned to the other holders and beneficiaries of this Account.

Further, any one or more of the joint owners shall have full authority for the Account and risk of the Account owners to buy, sell and trade in transactions of off-exchange products to deposit with and withdraw from KCM currencies, securities, negotiable instruments, and other property including withdrawals to or for the individual use or Account of the party directing the sale or of any other party to receive and acquiesce in the correctness of notices, confirmations, requests, demands, and all other forms of communications and to settle, compromise, adjust and give releases with respect to any and all claims, demands, disputes, and controversies.

Upon death or legal incapacity of any undersigned, KCM is authorized to take such action regarding the Account as KCM may deem it advisable to protect itself against any liability, penalty, or loss.

The Customer agrees to notify KCM immediately upon any joint owner’s death or legal incapacity. KCM may terminate this Agreement by written notice to any joint owners.

Margins and Deposit Requirements

Customer shall provide and maintain margin in such amounts and such forms as KCM may require at its sole discretion.

Customer agrees to deposit by immediate wire transfer such additional margin when and as required by KCM and will immediately meet all Margin Calls in such mode of transmission as KCM shall designate in its sole discretion.

KCM may change margin requirements at any time without prior notice. KCM retains the right to limit the amount and/or the total number of open positions that Customers may acquire or maintain with KCM. KCM reserves the right to close any Customer positions at any time that it deems necessary. KCM shall not be responsible for any loss or damage caused directly or indirectly by any events, actions, or omissions including but not limited to loss or damage resulting directly or indirectly from any delays or inaccuracies in the transmission of orders and/or information due to a breakdown in or failure of any transmission or communication facilities.

For example, in volatile market conditions, a margin call may be delayed resulting in the possibility of a negative usable margin; a margin call may occur even if positions are hedged in the jurisdictions where hedging is permitted by law due to rate volatility or daily interest charges or credits.

Rollovers

KCM may in its sole discretion and without notice to Customer offset Customer’s open positions, roll over Customer’s open positions into the next settlement time period, or make or receive delivery on behalf of Customer upon any terms and by any methods deemed reasonable by KCM in its sole discretion.

Terms and/or methods for delivering offsetting or rolling over Customer’s open positions may differ on a customer-by-customer basis at KCM’s sole discretion.

Any positions held in the Customer’s Account at 5 PM EST may be rolled over to the next settlement date. The Account may be debited or credited for the interest differential for the rollover period.

Settlement Date Offset Instructions

Offset instructions on positions open before settlement arriving at the settlement date must be given to KCM at least one to three business days before the settlement or value day. Alternatively, sufficient funds to take delivery or the necessary delivery documents must be in possession of KCM within the same period described above.

If neither instructions, funds nor documents are received KCM may without notice either offset Customer’s position or roll Customer’s positions into the next settlement time period or make or receive delivery on behalf of Customer upon such terms and by such methods deemed reasonable by KCM in its sole discretion.

Liquidation of Accounts

In the event of:

• Death or judicial declaration of incompetence of Customer or in the case of a legal entity, its dissolution or liquidation;
• Filing of a petition in bankruptcy or a petition for the appointment of a receiver or the institution of any insolvency or similar proceeding by or against Customer;
• Filing of an attachment against any of Customer’s Accounts carried by com;
• Insufficient margin or KCM’s determination that any collateral deposited to protect one or more Accounts of Customer is inadequate regardless of current market quotations to secure the Account;
• Customer’s failure to provide KCM with any information requested pursuant to this Agreement; or

• Any other circumstances or developments that KCM deems appropriate for its protection and in KCM’s sole discretion it may take one or more or any portion of the following actions:
  • Sell any or purchase any or all contracts, securities, or other property held or carried for Customer; and
  • Cancel any or all outstanding orders or contracts or any other commitments made with the Customer.

Any of the above actions may be taken without the demand for margin or additional margin without prior notice of sale or purchase or other notice to Customer, Customer’s personal or appointed representatives, heirs, executors, administrators, trustees, legatees, or assigns, and regardless of whether the ownership interest shall be solely Customer’s or held jointly with others.

Managed Accounts

With regard to managed Accounts, a money manager (“Money Manager”) is a person or entity authorized to make decisions with respect to an Account on behalf of the Account’s beneficial owners including a trustee, custodian, conservator, guardian, executor, administrator, an attorney in fact or investment advisor or another person to whom Customer has granted trading authority over an Account.

Customer understands and agrees that KCM may but is not required to review any action or inaction by a Money Manager with respect to an Account and is not responsible for determining whether a Money Manager’s action or inaction satisfies the standard of care applicable to such Money Manager’s handling of the Account.

The customer further understands and agrees that KCM is not responsible for determining the validity of a person’s or entity’s status or capacity to serve as a Money Manager.

Customer agrees to hold KCM and its officers, directors, employees, agents, and affiliates harmless from any liability, claim, or expense including attorneys’ fees and disbursements as incurred for the actions or non-actions of Customer’s Money Manager.

Customer Representations

General Representatives and Warranties: Customer represents and warrants that:

• Customer is of sound mind, legal age, and legal competence;
• Customer (if not a natural person) is duly organized and validly existing under the applicable laws of the jurisdiction of its organization;

• Execution and delivery of this Agreement and all transactions contemplated hereunder have been duly authorized by Customer and will not violate any statute, rule, regulation, ordinance, charter, by-law, or policy applicable to Customer;
• Each person executing and delivering this Agreement has been duly authorized by Customer to do so;
• No person other than the Customer has or will have an interest in Customer’s Account;
• Regardless of any subsequent determination to the contrary, Customer is suitable to trade over-the-counter products;
• Customer is not now an employee of any exchange, any corporation in which any exchange owns a majority of the capital stock, any member of any exchange, and/or firm registered on any exchange, or any bank, trust, or insurance company that trades the same instruments as those offered by KCM, and in the event that Customer becomes so employed Customer will promptly notify KCM via email of such employment;
• A customer has read and understands the Risk Disclosure Statement, Arbitration Agreement, and Trading Policies contained in this Agreement;
• The customer has conducted simulated trading using the demo trading platform for a period that has allowed the Customer to develop a full understanding of the trading platform;
• All information provided by Customer to KCM including information regarding Customer’s trading experience and investment sophistication is true, correct, and complete and Customer will notify KCM promptly of any changes in such information.

Customer cannot engage in transactions for purposes of arbitrage or exploitation of temporary inaccuracies or technical discrepancies.

Disclosure of Financial Information

Customer represents and warrants that the financial information disclosed to KCM in the Application is an accurate representation of the Customer’s current financial condition.

Customer represents and warrants that in determining Customer’s Net Worth, Gross Income, Total Assets, and Liabilities were carefully calculated.

Customer represents and warrants that in determining the value of Total Assets, the Customer included cash and/or cash equivalents, any Government and Marketable securities, real estate owned (excluding primary residence), the cash value of life insurance, and other valuable Assets.

Customer represents and warrants that in determining the value of Liabilities, Customer included notes payable to banks (secured and unsecured), notes payable to relatives, real estate mortgages payable (excluding primary residence), and other debts.

Customer represents and warrants that Customer has very carefully considered the portion of Customer’s Total Assets Which Customer considers to be Risk Capital. Customer recognizes that Risk Capital is the amount of money Customer is willing to put at risk and if lost would not in any way change Customer’s lifestyle.

Customer agrees to immediately inform KCM if the Customer’s financial condition changes in such a way as to reduce Customer’s Net Worth and/or Risk Capital.

Credit

Customer authorizes KCM or agents acting on behalf of KCM to investigate Customer’s credit standing and in connection therewith to contact such banks, financial institutions, and credit agencies as KCM shall deem appropriate to verify information regarding Customer.

Customer further authorizes KCM to investigate Customer’s current and past investment activity and in connection therewith to contact such futures commission merchants, exchanges, broker/dealers, banks, compliance data centers, and any other financial and investment institution as KCM shall deem appropriate.

Upon reasonable request made in writing by Customer to KCM, Customer shall be allowed to review any records maintained by KCM relating to Customer’s credit standing.

Customer shall also be allowed, at the Customer’s sole cost and expense, to copy such records. The customer acknowledges that the Customer’s credit score may be impacted when KCM accesses the Customer’s credit file.

The customer also acknowledges that KCM may provide information (e.g. negative Account information of unsecured debts) regarding the Customer’s performance under this Agreement to these agencies.

Order Management

Cancellation and Modification Requests: The customer acknowledges that it may not be possible to cancel or modify an order. The customer understands and agrees that if an order cannot be canceled or modified the Customer is bound by any execution of the original order.

KCM is not liable to Customers if KCM is unable to cancel or modify an order. The Customer further acknowledges that attempts to modify or cancel and replace an order can result in an over- execution of the order or the execution of duplicate orders that KCM’s systems do not prevent over-execution on duplicate orders from occurring and that Customer shall be responsible for all such executions.

Customer agrees not to assume that any order has been executed or canceled until the Customer has received confirmation from KCM with regard to order execution.

The customer is responsible for knowing the status of the Customer‘s pending orders before entering additional orders. Customer agrees to contact KCM in the event Customer is unclear on the status of an order.

Customer agrees to regularly review Customer’s online Account Statement to confirm the status of Customer’s orders.

Statements and Confirmation

Reports of the confirmation of orders and statements of Accounts for Customer shall be deemed correct and shall be conclusive and binding upon Customer if not objected to immediately upon receipt and confirmed in writing within one (1) business day after the execution of the Customer’s order.

KCM will provide Customer access to view the Customer’s Account at any time with an online login via the Internet. KCM will not provide trade confirmation via postal mail.

Written objections on the Customer’s part shall be directed to KCM at its address located at: First St. Vincent Bank Ltd James Street Kingstown St. Vincent and the Grenadines and shall be deemed received only if actually sent via email or delivered or mailed by registered mail return receipt requested.

Failure to object shall be deemed ratification of all actions taken by KCM or its agents prior to Customer’s receipt of said reports.

Customer’s failure to receive a trade confirmation shall not relieve Customer of the obligation to object as set out herein.

Charges

Customer shall pay such charges (including without limitation mark-ups and markdowns, statement charges, idle Account charges, order cancellation charges, account transfer charges, introducing broker and Money Manager fees, or other charges) arising out of KCM providing services hereunder. KCM may change its charges without notice.

All such charges shall be paid by Customer as they are incurred or as KCM in its sole and absolute discretion may determine and Customer hereby authorizes KCM to withdraw the amount of any such charges from Customer’s Account(s).

Deposits and Withdrawals

KCM shall neither receive nor disburse Customer’s funds in cash, currency, or cash equivalents.

All transactions between Customer and KCM shall be performed by wire, Automatic Clearing House (“ACH”), or other methods in which the identities of both the sending and receiving parties can be verified by KCM and which KCM in its sole discretion shall deem appropriate.

KCM shall perform deposit/withdrawal transactions only between Customer’s KCM Account and another Account which is held in Customer’s name or of which Customer clearly demonstrates ownership to KCM.

In order to prevent money laundering, fraud, and other unauthorized activity, KCM may limit the Customer’s withdrawal options.

Kanak Capital Markets LLC customers can withdraw their funds and benefits whenever they need to. To request a partial or complete withdrawal of funds from your account click on “Withdrawal request” in your KCM Portal.

Withdrawal Conditions:

• If the client does not have any open positions nor any amount of bonus in their account, the client’s withdrawal will be taken from the amount stated under VALUE
• If the client does not have any open positions but do have a bonus amount in their account, the client’s withdrawal will be taken from the amount stated under BALANCE
• If the client has open positions in their account, they can only withdraw the amount stated under FREE VALUE, to ensure the security of their open positions are sufficiently

Please consider that we take up to 5 business days to process your withdrawal request. Corresponding withdrawals will & may take up to 10 business days to reflect on your debit/credit card or bank account.

Feel free to contact our customer support specialist if you have any questions. According to generally acceptable AML rules and regulations, withdrawals must be performed only through the same bank account or credit/debit card that you used to deposit the funds.

Furthermore, when it comes to withdrawals, the Client may be required to present additional information and documents.

KCM’s Responsibilities

KCM will not be responsible for delays in the transmission of orders due to a breakdown or failure of transmission or communication facilities, electrical power outage, or for any other cause beyond KCM’s control or anticipation.

KCM shall not be liable for losses arising from the default of any agent or any other party used by KCM under this agreement.

Currency Fluctuation Risk

If Customer directs KCM to enter into any transaction:

• Any profit or loss arising as a result of a fluctuation in the rates affecting such a transaction will be entirely for Customer’s Account and risk;
• All initial and subsequent deposits for margin purposes shall be made in USD or another currency which KCM may choose to accept in such amounts as KCM may in its sole discretion require with subsequent deposits being in the same currency as the initial deposit; and
• KCM is authorized to convert funds in Customer’s Account for margin into and from such foreign currency at a rate of exchange determined by KCM in its sole discretion on the basis of then-prevailing money market rates.

Cross-Trade Consent

Customer hereby acknowledges and agrees that KCM may act as the counterparty to Customer for any trade entered for the undersigned’s Account.

The undersigned hereby consents to any such transaction subject to the limitations and conditions if any contained in the Rules or Regulations of any bank, institution, exchange, or board of trade upon which such buy or sell orders are executed and subject to the limitations and conditions if any contained in any applicable regulations of any globally recognized regulatory agency.

Communications

General Communications: Reports, statements, and any other communications shall be transmitted to Customer electronically by posting to Customer’s online account or via email to the email address on Customer’s application or to such other email address as Customer may from time to time designate to KCM.

Email and Electronic Communications: All emails sent to and from KCM are subject to monitoring, review, or disclosure to someone other than the Customer or the Customer’s intended recipient. The customer acknowledges that there may be delays in the email being received by the Customer’s intended recipient.

Customer agrees to hold KCM harmless for any delay in email delivery regardless of whether the delay was caused by KCM or a third party. Email sent to and from a KCM address may be retained by KCM’s corporate email system.

Customer agrees not to use email to transmit orders to purchase or sell over-the-counter products and further agrees that KCM is not liable for any actions taken or any omissions to act as a result of any email message Customer sends to KCM.

Electronic communications with KCM via our Website, wireless device, or touchtone service are also subject to monitoring, review by, or disclosure to someone other than the recipient, and such communications may be retained by KCM.

Third Parties

No Separate Agreements: Customer acknowledges that Customer has no separate agreement with Customer’s broker or any KCM employee or agent regarding the trading in Customer’s Account including any agreement to guarantee profits or limit losses in Customer’s Account.

Customer understands that Customer is under an obligation to notify KCM Compliance Department immediately in writing as to any agreement of this type.

Further, Customer understands that any representations made by anyone concerning Customer’s Account that differ from any statements Customer receives from KCM must be brought to the attention of KCM’s Compliance Department immediately in writing.

Customer understands that Customer must authorize every transaction prior to its execution unless Customer has delegated discretion to another party by signing KCM’s limited power of attorney (“LPOA”).

Any disputed transactions must be brought to the attention of KCM’s Compliance Department pursuant to the notice requirements of this Agreement.

Customer agrees to indemnify and hold KCM harmless from all damages or liability resulting from Customer’s failure to notify KCM’s Compliance Department within one (1) business day of any of the occurrences referred to herein. All notices required under this section shall be sent to KCM at its address.

Revenue Sharing Disclosure

Customer acknowledges that KCM may enter into revenue-sharing arrangements with or retain the services of any other third-party vendors in connection with technology support, back office, and operational support functions relating to Customer’s Accounts.

KCM reserves the right to enter into such compensation or revenue-sharing arrangements with any other third-party vendors based on volume traded, bid/offer pricing, or other outside commission or revenue-sharing models.

Compliance

Anti-Money Laundering Procedures: Customer agrees to and acknowledges that KCM may conduct the following procedures at the time of the opening and throughout the existence of the Account:

Verification Processes: In accordance with anti-money laundering and combating the funding of terrorism standards, KCM may require to identify and verify the person who signs up. When a customer opens an account, KCM is required to collect information such as – but not limited to – name and surname, date of birth, and residential address. The customer agrees that KCM reserves the right to close the account at its sole discretion if we come across any problem with the verification checks.

Email Verification: After the person completed the sign-up form, they will be asked to verify his/her email address via an activation link. If this step is not completed, access to the account will be denied.

Two-Factor Authentication: After the customer completed the sign-up form, in order to access the account they need to enable Two-factor authentication (2FA) on his account. It is an extra layer on your KCM account to protect your account and data from unauthorized access attempts.

Identity Verification Checks: In order to complete the identity verification, KCM may make use of third-party providers to confirm any information that the person registers. KCM may verify the customer’s information by requiring Customer to provide official identification documents and proof of address or additional documents which you will be advised of at the time. Corporate clients will be required to submit additional documentation such as (not limited to) certificates of incorporation and articles of association.

At any given time whilst the customer has an account open with us, we may decide to carry out further verification checks (which may include requests for additional documents or information) to satisfy routine security checks.

If we are not able to verify the person’s registered details if the customer is not able to or deny to provide the requested document/s and/or information, KCM has the right to suspend the account and return any remaining balance up to the amount of the original deposits.

Monitoring

KCM may monitor the trading activity in Accounts to investigate or identify potential money laundering.

Security and Confidentiality

Customer agrees and acknowledges that Customer is the exclusive owner and solely responsible, jointly and severally if applicable, for the confidentiality and protection of Customer’s Account number(s) and password(s) that allow Customer to place online orders and access KCM electronic trading systems.

Customer further agrees that Customer will be fully responsible for all activities including brokerage transactions that arise from the use of Customer’s Account number(s) and password(s).

Customer agrees to indemnify and hold KCM harmless if any other person utilizing Customer’s confidential information provides instructions to KCM that may be contrary to Customer’s instructions.

Customer will immediately notify KCM in writing or by email of any loss, theft, or unauthorized use of Customer’s Account number and/or passwords.

Intellectual Property and Confidentiality

All copyright, trademark, trade secret, and other intellectual property rights in the KCM Trading Platform (“Trading Platform”) shall remain at all times the sole and exclusive property of KCM and/or its third-party service providers, and Customers shall have no right or interest in the Trading Platform except for the right to access and use the Trading Platform as specified herein.

Customer acknowledges that the Trading Platform is confidential and has been developed through the expenditure of substantial skill, time, effort, and money.

Customer will protect the confidentiality of KCM and/or its third-party service providers by allowing access to the Trading Platform only by its employees and agents on a need-to-access basis.

Customer will not publish, distribute, or otherwise make information available to third parties any information derived from or relating to the Trading Platform.

Customer will not copy, modify, decompile, reverse engineer, and make derivative works of the Trading Platform or in the manner in which it operates.

No Advice and No Recommendations

Customer acknowledges that KCM does not and will not give investment, legal, or tax advice or make trading recommendations. Customer acknowledges that KCM makes no representations concerning the tax implications or treatment of contracts.

Customer agrees that Customer is a self-directed investor and all orders entered are unsolicited and based on Customer’s own investment decision or the investment decision of Customer’s duly authorized representative.

Customer agrees that neither KCM nor any of its employees may be Customer’s duly authorized representative and that Customer will neither solicit nor rely upon KCM or any of its employees for any such advice.

Customer understands that Customer is solely responsible for all orders entered including but not limited to trade qualifiers, the number of trades entered, the suitability of any trade(s), investment strategies, and risks associated with each trade and will not hold KCM or any of its employees liable for those investment decisions.

Customer further understands that KCM does not and will not review the appropriateness or suitability of any transactions implemented or investment strategies employed in Customer’s Account.

Customer hereby agrees to hold KCM and its officers, directors, employees, agents, and affiliates harmless from any liability, financial or otherwise, or expense (including attorneys’ fees and disbursements) as incurred as a result of any losses or damages Customer may suffer with respect to any such decisions, instructions, transactions, or strategies employed in Customer’s Account by Customer or Customer’s duly authorized representative or as a result of any breach by Customer of any of the covenants, representations, acknowledgments, or warranties herein.

Trading Recommendations

Customer acknowledges that:

• Any market recommendations and information communicated to Customer by KCM or by any person within the company does not constitute an offer to sell or the solicitation of an offer to buy any contract. Such recommendation and information, although based upon information obtained from sources believed by KCM to be reliable, may be based solely on a broker’s opinion and that such information may be incomplete and may be unverified; and
• KCM makes no representations, warranties, or guarantees as to and shall not be responsible for the accuracy or completeness of any such information or trading recommendation furnished to Customer.

Customer acknowledges that KCM and/or its officers, directors, affiliates, associates, stockholders, or representatives may have a position in or may intend to buy or sell which are the subject of market recommendations furnished to Customer and that the market position of KCM or any such officer, director, affiliate, associate, stockholder, or representative may not be consistent with the recommendations furnished to Customer by kanakmarkets.com.

Risk Acknowledgment

Customer acknowledges that investments in leveraged transactions are speculative, involve a high degree of risk, and are appropriate only for persons who can assume the risk of loss of their margin deposit.

Customer understands that because of the low margin normally required in trading over-the- counter contracts, price changes in contracts may result in the loss of Customer’s margin deposit.

Customer warrants that Customer is willing and able, financially and otherwise, to assume the risk of trading and in consideration of KCM’s carrying his/her Account(s), Customer agrees not to hold KCM responsible for losses incurred through following its trading recommendations or suggestions or those of its employees, agents, or representatives.

Customer recognizes that guarantees of profit or freedom from loss are impossible in trading.

Customer acknowledges that Customer has received no such guarantees from KCM or from any of its representatives or any introducing agent or other entities with whom Customer is conducting his/her KCM Account and has not entered into this agreement in consideration of or in reliance upon any such guarantees or similar representations.

Recordings

Customer agrees and acknowledges that all conversations regarding Customer’s Account(s) between Customer and KCM personnel may be electronically recorded with or without the use of an automatic tone warning device.

Customer further agrees to the use of such recordings and transcripts thereof as evidence by either party in connection with any dispute or proceeding that may arise involving Customer or kanakmarkets.com.

Customer understands that KCM destroys such recordings at regular intervals in accordance with KCM’s established business procedures and Customer hereby consents to such destruction.

Security Agreement

All monies, securities, negotiable instruments, contracts, and/or other property on deposit with KCM or its affiliates in Customer’s Account for any purpose including safekeeping are hereby pledged with KCM and shall be subject to a security interest in KCM’s favor for the discharge of all Customer’s obligations to KCM irrespective of the number of Accounts Customer has with KCM.

Customer also grants KCM the right to use the above-described properties and any Account credit to offset against any of Customer’s obligations to KCM including but not limited to transfers for the purpose of margining or for application to negative balance Accounts not promptly paid as well as delivery costs and charges.

Use of Monies

Customer hereby also grants to KCM the right to pledge, repledge, hypothecate, invest, or loan either separately or with the property of other customers to itself or to others any funds, securities, currencies, and foreign currency or off-exchange transactions of Customer held by KCM as margin or security. KCM shall at no time be required to deliver to Customer the identical property delivered to or purchased by KCM for any Account of Customer.

Technology and Communications Issues

KCM and/or its third-party service providers provide trading technology for Customer’s use in connection with transactions made by Customer with KCM. Such trading technology includes but is not limited to the Trading Platform, web applications, application program interfaces, software, software code, programs, protocols, and displays (collectively “Technology”) for trading, analyzing trades and markets, and constructing automated trading systems.

KCM provides the Technology “as is” without any warranties of merchantability, fitness for a particular purpose, or other express or implied warranties.

KCM will not be responsible for the operation or performance of any automated trading system developed with Technology or for any malfunctions of Technology or for any delays or interruptions in the transmission of orders due to breakdown, excessive call volume, or failure of transmission or communication equipment on the Internet or otherwise including but not limited to communications problems, computer software or hardware breakdowns, malfunctioning errors, any and all problems or glitches associated with computer problems or any other technical cause or causes.

Foreign Accounts

Customers not residing in the United States (“Foreign Accounts”) may be asked to comply with requests for special information by KCM as required by any governmental unit or regulatory agency.

This includes but is not limited to special calls for information. In the event of a special call for information, KCM or its agent shall be required to obtain the information set forth by any governmental unit or regulatory agency requesting information. In addition, failure to respond to a special call may cause transactions to be prohibited (other than offsetting trades) for Customer.

Foreign Accounts must copy and forward an official form of picture identification and must provide a bank reference before Customer is approved for trading.

Miscellaneous

Termination: This Agreement shall continue in effect until termination and may be terminated by Customer at any time when Customer has no open position(s) and no liabilities held by or owed to KCM upon the actual receipt by KCM of written notice of termination via email or at any time whatsoever by KCM upon the transmittal of written notice of termination to Customer; provided that such termination shall not relieve either party of any obligations set out in this Agreement nor shall it relieve Customer of any obligations arising out of prior transactions entered into in connection with this Agreement.

Acceptance: This Agreement shall not be deemed to be accepted by KCM nor become a binding contract between Customer and KCM until Customer’s information is verified and approved by KCM.

Indemnification: Customer agrees to indemnify and hold KCM, its affiliates, employees, agents, successors, and assigns harmless from and against any and all liabilities, losses, damages, costs, and expenses including attorney’s fees incurred by KCM arising out of Customer’s failure to fully and timely perform Customer’s responsibilities herein or should any of the representations and warranties fail to be true and correct.

The customer also agrees to pay promptly to KCM all damages, costs, and expenses including attorney’s fees incurred by KCM in the enforcement of any of the provisions of this Agreement and any other agreements between KCM and Customer.

Force Majeure: KCM shall not be liable to Customer for any claims, losses, damages, costs, or expenses including attorneys’ fees caused directly or indirectly by any events, actions, or omissions including without limitation claims, losses, damages, costs, or expenses including attorneys’ fees resulting from civil unrest, war, insurrection, international intervention, governmental action (including without limitation exchange controls, forfeitures, nationalizations, devaluations), natural disasters, acts of God, market conditions, inability to communicate with any

relevant person or any delay, disruption, failure, or malfunction of any transmission or communication system or computer facility whether belonging to kanakmarkets.com, Customer, any market, or any settlement or clearing system.

Governing Law and Jurisdiction: This Agreement and the rights and obligations of the parties hereto shall be governed by, construed, and enforced in all respects by the laws of the State of California without regard to the choice of law principles.

Use of kanakmarkets.com’s Websites

Websites refer to kanakmarkets.com’s Website (kanakmarkets.com and additional Web sites that kanakmarkets.com may register). The Websites provide Customer with content and information. The content on the Websites is provided as a convenience but may be inaccurate or outdated.

Customer always agrees to rely upon Customer’s transaction confirmations and statements as the official records of Customer’s Account.

Information is not related specifically to an Account. Information is financial or investment information provided by third parties to kanakmarkets.com that kanakmarkets.com provides to Customer which includes market data, news, research, financial analysis, commentary, or tools.

The information on the Websites is provided from sources believed to be reliable but cannot be guaranteed.

The information provided on our Websites is not customized for Customer and Customer understands that the information provided to Customer is not a recommendation to Customer about the suitability of a purchase and/or sale of any trading product.

KCM may without notice to Customer change, revise, modify, add, upgrade, remove, or discontinue any part of KCM’s Websites. The Websites may include hyperlinks to third-party websites.

kanakmarkets.com is not responsible for the information or content provided by such third-party websites.

Market Data News and Other Information

Customer agrees that the market data, news, and other information available to Customer through our Website is for Customer’s personal use and that Customer will not retransmit or republish this information in any form without the written consent of KCM.

No Waiver or Amendment

No provision of this Agreement may be waived or amended unless the waiver or amendment is in writing and signed by both Customer and an authorized officer of KCM.

No waiver or amendment of this Agreement may be implied from any course of trading between the parties or from any failure by KCM or its agents to assert its rights under this Agreement on any occasion or series of occasions.

 

No oral agreements or instructions to the contrary shall be recognized as enforceable.

This instrument and the attachments hereto embody the entire agreement of the parties, superseding any and all prior written and oral agreements, and there are no other terms, conditions, or obligations other than those contained herein.

Severability

This Agreement, any attachments thereto, and the terms and conditions contained in statements and confirmations contain the entire agreement between the parties with respect to the subject matter hereof.

If any provision or condition of this Agreement shall be held to be invalid or unenforceable by any court or regulatory or self-regulating agency or body, such provision shall be deemed modified or, if necessary, rescinded in order to comply with the relevant court or regulatory or self-regulatory agency or body.

The validity of the remaining provisions and conditions shall not be affected thereby and this Agreement shall be carried out as if such invalid or unenforceable provision or condition was not contained herein.

Account Transfer and Assignment

Customer authorizes KCM to transfer and assign Customer’s Account to a futures commission merchant or another legal entity. Customer may not transfer or assign this Agreement without KCM’s prior written consent. Any purported assignment by the Customer in violation of this provision is null, void, and unenforceable.

General

Trading in a margined account involves a high degree of risk including the risk of loss of the Customer’s entire Risk Capital deposited with KCM. Losses in some cases have the potential to extend beyond the Customer’s Account Value.

In consideration of KCM agreeing to enter into contracts with its Customer(s) for this Account, KCM requires all the undersigned Customer(s) to analyze their financial objectives, financial status, investment constraints, and tax situation to determine whether trading is suitable. In addition, we require our Customers to carefully read and acknowledge the KCM Risk Disclosure Statement that outlines without limitation the risks associated with trading a margined account through kanakmarkets.com. By signing this Agreement, the Customer understands and agrees that:

• OTC Margined Trading involves a high amount of risk and is highly speculative. Customer(s) agrees that they are in full understanding and willing to assume the legal, economic, and other risks associated with trading a margined account and are willing and able to assume the loss of their entire Risk Capital defined as those funds that if lost would not change your lifestyle or your family’s lifestyle. As such, they further agree that margined trading is not suitable for Retirement Funds. KCM encourages Customers to closely manage outstanding open positions and to use prudent money management precautions such as but not limited to Stop Loss Orders.
• Excessive leverage available with Margined accounts can lead to quick Customer(s) agrees that using a high degree of leverage defined as the use of a small amount of capital to control a larger amount of an Open Position can result in large losses due to a price change(s) of open contract(s) with KCM.
• KCM provides leverage on most trading products for most customers of 100:1 or more. With 100:1 leverage, the Customer has the potential to control a $1,000,000 position with

$10,000 in an Account. KCM encourages its Customers to use only that portion of leverage that the Customer is most comfortable with and to use money management precautions such as but not limited to Stop Loss Orders for the purpose of limiting risk. KCM reserves at its sole discretion the right to reduce or increase the amount of leverage given on any trading product at any time and without notice.

• Trading experience periods of liquidity risk. Customer acknowledges that Liquidity Risk resulting from decreased liquidity is usually due to unanticipated changes in economic and/or political Customer also acknowledges that Liquidity Risk can affect the general market in that all participants experience the same lack of buyers and/or sellers.
• The Customer also understands that liquidity risk can be KCM specific due to changes in liquidity available to KCM from a KCM Custodian of funds, interbank liquidity providers due to a perception that the risks of the market segment have increased. When liquidity decreases, Customers can expect at the minimum to have wider bid-to-ask spreads as the supply of available bid/ask prices outstrips the demand.
• Decreases in liquidity can also result in “Fast Market” conditions where the price of a trading product moves sharply higher or lower or in a volatile up/down pattern without trading in an ordinary step-like fashion. In some instances, there may exist the possibility that a trading bid and/or ask price for a trading product or products are not available (a situation where there is no liquidity).
• Although there may be instances when the aggregate OTC market enters a “Fast Market” situation or periods where liquidity is in short or no supply, it is important to note that

prices, bid/ask spreads, and liquidity will reflect the prevailing interbank market liquidity for KCM. KCM can Liquidate Positions of the Customer that do not have adequate margin: Because of the leverage available with OTC Margined Trading and the potential for extreme volatility, KCM Custodian of funds reserves the sole discretionary right to liquidate Customer’s Account(s) should the Margin in the Account not be sufficient to cover the potential risk of loss. Should the Customer’s Account value go below the free of programming bugs that can cause trading position keeping or any other required functionality of the Trading Platform and other relevant software applications associated with KCM including but limited to clearing and escrow Account software from becoming inoperable or without errors?

• There is a Communication Risk that the Customer assumes. Although KCM will have qualified representatives available on the telephone during business hours to accept and execute Customer Market Orders, there exists the risk that the Customer will not be able to contact or contact the KCM representative due to but not limited to communication malfunction, an overabundance of telephone orders, or any other malfunction or
• The Customer acknowledges and agrees that they will hold harmless KCM for any loss or missed trading opportunity resulting from any communication problems the Customer may
• KCM does not take responsibility for Money Should a Customer grant a Money Manager trading discretionary trading authority or control over a trading account, the Customer acknowledges that KCM does not review the action or inaction of Money Managers and is not responsible for determining the suitability of trades made by a Money Manager. The Customer agrees to hold KCM harmless for any loss or liability arising from the decisions made by a Money Manager.

Governing Law and Jurisdiction

• This Agreement and the rights and obligations of the parties hereto shall be governed by, construed, and enforced in all respects by the laws of California without regard to the choice of law principles. Both parties hereby submit to the exclusive jurisdiction of the courts of the state of California, USA.