Common use of Structured Products Clause in Contracts

Structured Products. Structured Products are products structured to fulfil a particular trading or market objective. A structured product may combine the features of two or more financial instruments (for example a bond and a derivative). Derivatives often constitute an integral part of a structured product. The product may involve an element of leverage and so a relatively small movement in the value of the relevant underlying asset or index may have a significant effect on the value of the structured product. Structured products are generally not traded on regulated markets and you take the risk on the counterparty issuing the structure. There is typically no recognised market for these investments and it may, therefore, be difficult for you to deal in the investment or to obtain reliable information about its value or the extent of the risks to which you are exposed. Some structured products include an element of capital protection – however, you should bear in mind that this is not a guarantee that the amount invested will be returned in all circumstances. The capital protection offered is typically subject to the investment being held until maturity and to the creditworthiness of the issuer. Structured products are often high risk investments and you could lose some or all of the money that you have invested in them. General risks Structured products are not suitable for all investors due to potential illiquidity, time to redemption, and the payoff profile of the strategy. These products may not be readily realisable investments and are not traded on any regulated market. Please consider carefully before investing. Additional risks associated with investing in structured products include:  Market Risk Capital repayment depends on the performance of the Underlying, the future performance of which cannot be guaranteed.  Credit Risk The holder of the investments will be exposed to the credit risk of the Issuer.  Exit Risk The secondary market price of the investments will depend on many factors, including the value and volatility of the underlying index/ interest rates/ the dividend rate on the stocks that comprise the index/underlying stock, time remaining to maturity and the creditworthiness of the Issuer. Prior to maturity, the price may be less than the amount the holder would have received on maturity of the investment. Where the underlying is a security or a basket of securities We or our affiliates or persons associated with us or such affiliates may maintain a long or short position in securities referred to herein, or in related futures or options, purchase or sell, make a market in, or engage in any other transaction involving such securities, and earn brokerage or other compensation. Where the underlying is an Index Calculations of returns on the instruments is linked to a referenced index. In such cases, the investments may not be suitable for persons unfamiliar with such index or unwilling or unable to bear the risks associated with the transaction}. Where the underlying is an Interest Rate Calculations of returns on the instruments is linked to a referenced interest rate. In such cases, the investments may not be suitable for persons unfamiliar with such interest rate or unwilling or unable to bear the risks associated with the transaction. Where capital protection is less than 100% or Capital at Risk Products The product contains either no capital protection or is less than 100% capital protected. You should only invest in this product if you are prepared to lose some or all of the money initially invested. This notice cannot disclose all the risks associated with this type of product, therefore, before entering into any transaction you should ensure that you fully understand the potential risks and rewards and independently determine that it is suitable for you given your objectives, experience, financial resources and any other relevant circumstances. You should remember that the investment and the income from it could go down as well as up. The return at the end of the investment period is not guaranteed and you may not receive a return of your investment. The Product term sheet specifies limits within which your capital will be repaid. You should consider these limits and only enter into a transaction in the product described if you are prepared to lose some or all of the money initially invested. You should be aware that any maximum benefit described is only available after a set period and the rate of income or growth may depend on specific conditions being met. The initial capital invested may be placed into high-risk investments and it may be geared, therefore a small percentage fall in the underlying may result in a larger reduction in the amount paid out. If you choose to sell before maturity, it may result in a loss to your capital and a poor return.

Structured Products. Structured Products are products structured to fulfil a particular trading or market objective. A structured product may combine the features of two or more financial instruments Financial Instruments (for example a bond and a derivative). Derivatives often constitute an integral part of a structured product. The product may involve an element of leverage and so a relatively small movement in the value of the relevant underlying asset or index may have a significant effect on the value of the structured product. Structured products are generally not traded on regulated markets and you take the risk on the counterparty issuing the structure. There is typically no recognised market for these investments and it may, therefore, be difficult for you to deal in the investment or to obtain reliable information about its value or the extent of the risks to which you are exposed. Some structured products include an element of capital protection – however, you should bear in mind that this is not a guarantee that the amount invested will be returned in all circumstances. The capital protection offered is typically subject to the investment being held until maturity and to the creditworthiness of the issuer. Structured products are often high risk investments and you could lose some or all of the money that you have invested in them. General risks Structured products are not suitable for all investors due to potential illiquidity, time to redemption, and the payoff profile of the strategy. These products may not be readily realisable investments and are not traded on any regulated market. Please consider carefully before investing. Additional risks associated with investing in structured products include:  Market Risk Capital repayment depends on the performance of the Underlying, the future performance of which cannot be guaranteed.  Credit Risk The holder of the investments will be exposed to the credit risk of the Issuer.  Exit Risk The secondary market price of the investments will depend on many factors, including the value and volatility of the underlying index/ interest rates/ the dividend rate on the stocks that comprise the index/underlying stock, time remaining to maturity and the creditworthiness of the Issuer. Prior to maturity, the price may be less than the amount the holder would have received on maturity of the investment.  Liquidity Risk Although the Issuer will use reasonable efforts to quote bid and offer prices (subject to internal policy and applicable laws and regulations), the liquidity of the investments may be limited or non existing.  Income not guaranteed The investment does not generate a guaranteed income and investors will not receive dividends, which they would otherwise receive if they invested in the Underlying directly.  Cap on return The secondary market price of the investments will depend on many factors, including the value and volatility of the underlying index/ interest rates/ the dividend rate on the stocks that comprise the index/underlying stock, time remaining to maturity and the creditworthiness of the Issuer. Prior to maturity, the price may be less than the amount the holder would have received on maturity of the investment. Where the underlying is a security or a basket of securities We or our affiliates or persons associated with us or such affiliates may maintain a long or short position in securities referred to herein, or in related futures or options, purchase or sell, make a market in, or engage in any other transaction involving such securities, and earn brokerage or other compensation. Where the underlying is an Index Calculations of returns on the instruments is linked to a referenced index. In such cases, the investments may not be suitable for persons unfamiliar with such index or unwilling or unable to bear the risks associated with the transaction}. Where the underlying is an Interest Rate Calculations of returns on the instruments is linked to a referenced interest rate. In such cases, the investments may not be suitable for persons unfamiliar with such interest rate or unwilling or unable to bear the risks associated with the transaction. Where capital protection is less than 100% or Capital at Risk Products The product contains either no capital protection or is less than 100% capital protected. You should only invest in this product if you are prepared to lose some or all of the money initially invested. This notice cannot disclose all the risks associated with this type of product, therefore, before entering into any transaction you should ensure that you fully understand the potential risks and rewards and independently determine that it is suitable for you given your objectives, experience, financial resources and any other relevant circumstances. You should remember that the investment and the income from it could go down as well as up. The return at the end of the investment period is not guaranteed and you may not receive a return of your investment. The Product term sheet specifies limits within which your capital will be repaid. You should consider these limits and only enter into a transaction in the product described if you are prepared to lose some or all of the money initially invested. You should be aware that any maximum benefit described is only available after a set period and the rate of income or growth may depend on specific conditions being met. The initial capital invested may be placed into high-risk investments and it may be geared, therefore a small percentage fall in the underlying may result in a larger reduction in the amount paid out. If you choose to sell before maturity, it may result in a loss to your capital and a poor return.

Structured Products. Structured Products are products structured to fulfil a particular trading or market objective. A structured product may combine the features of two or more financial instruments (for example a bond and a derivative). Derivatives often constitute an integral part of a structured product. The product may involve an element of leverage and so a relatively small movement in the value of the relevant underlying asset or index may have a significant effect on the value of the structured product. Structured products are generally not traded on regulated markets and you take the risk on the counterparty issuing the structure. There is typically no recognised market for these investments and it may, therefore, be difficult for you to deal in the investment or to obtain reliable information about its value or the extent of the risks to which you are exposed. Some structured products include an element of capital protection – however, you should bear in mind that this is not a guarantee that the amount invested will be returned in all circumstances. The capital protection offered is typically subject to the investment being held until maturity and to the creditworthiness of the issuer. Structured products are often high risk investments and you could lose some or all of the money that you have invested in them. General risks Structured products are not suitable for all investors due to potential illiquidity, time to redemption, and the payoff profile of the strategy. These products may not be readily realisable investments and are not traded on any regulated market. Please consider carefully before investing. Additional risks associated with investing in structured products include:  − Market Risk Capital repayment depends on the performance of the Underlying, the future performance of which cannot be guaranteed.  − Credit Risk The holder of the investments will be exposed to the credit risk of the Issuer.  − Exit Risk The secondary market price of the investments will depend on many factors, including the value and volatility of the underlying index/ interest rates/ the dividend rate on the stocks that comprise the index/underlying stock, time remaining to maturity and the creditworthiness of the Issuer. Prior to maturity, the price may be less than the amount the holder would have received on maturity of the investment. Where the underlying is a security or a basket of securities We or our affiliates or persons associated with us or such affiliates may maintain a long or short position in securities referred to herein, or in related futures or options, purchase or sell, make a market in, or engage in any other transaction involving such securities, and earn brokerage or other compensation. Where the underlying is an Index Calculations of returns on the instruments is linked to a referenced index. In such cases, the investments may not be suitable for persons unfamiliar with such index or unwilling or unable to bear the risks associated with the transaction}. Where the underlying is an Interest Rate Calculations of returns on the instruments is linked to a referenced interest rate. In such cases, the investments may not be suitable for persons unfamiliar with such interest rate or unwilling or unable to bear the risks associated with the transaction. Where capital protection is less than 100% or Capital at Risk Products The product contains either no capital protection or is less than 100% capital protected. You should only invest in this product if you are prepared to lose some or all of the money initially invested. This notice cannot disclose all the risks associated with this type of product, therefore, before entering into any transaction you should ensure that you fully understand the potential risks and rewards and independently determine that it is suitable for you given your objectives, experience, financial resources and any other relevant circumstances. You should remember that the investment and the income from it could go down as well as up. The return at the end of the investment period is not guaranteed and you may not receive a return of your investment. The Product term sheet specifies limits within which your capital will be repaid. You should consider these limits and only enter into a transaction in the product described if you are prepared to lose some or all of the money initially invested. You should be aware that any maximum benefit described is only available after a set period and the rate of income or growth may depend on specific conditions being met. The initial capital invested may be placed into high-risk investments and it may be geared, therefore a small percentage fall in the underlying may result in a larger reduction in the amount paid out. If you choose to sell before maturity, it may result in a loss to your capital and a poor return.