FXSI Client Operating Guide - BBH & Co.

Transcription

1 147_16 FXSI Client Operating Guide - BBH & Co.

2 FXSI Client Operating Guide - BBH & Co. TABLE OF CONTENTS: 1. Introduction 2. Product Coverage 3. Submitting & Processing FXSI Requests 4. FX Settlement Date and Execution 5. Override Instructions 6. Responsibilities 7. Late Security Transaction Instructions 8. FX Cancellations 9. FXSI Activity Notifications 10. Product Exceptions/Clarifications APPENDICES: A. Foreign Exchange Standing Instructions (FXSI) Request Form for Security Transactions (DVP / RVP) B. Foreign Exchange Standing Instructions (FXSI) Request Form for Corporate Actions C. Corporate Action Events Eligible for FXSI for Corporate Actions D. Repatriation / Funding FXSI Override Request Form E. FXSI Trade Confirmation Request Form F. FXSI Currency Abbreviation Names for Security Transactions Brown Brothers Harriman Page 2

3 FXSI Client Operating Guide - BBH & Co. 1. INTRODUCTION This Foreign Exchange Standing Instructions ( FXSI ) Client Operating Guide (the Guide ) provides the standards pursuant to which Brown Brothers Harriman & Co. ( BBH ) will execute foreign exchange transactions based upon BBH s client s standing instructions in connection with assets held in custody by BBH on behalf of such client. Subject to the standards set forth in this Guide, foreign exchange ( FX ) transactions based upon standing instructions will be executed by BBH to or from a base currency designated by BBH s client or its authorized representative (collectively, the Client ). The FX transactions will correspond with the settlement of security transactions and / or corporate actions in connection with assets held in custody by BBH on behalf of the Client. BBH reserves the right to suspend or eliminate any market / currency from its FXSI product offering. These situations would typically be driven by, among other things, changes with local law, applicable market regulations, market restrictions, and market conditions. BBH will promptly notify Client of any such suspension or elimination and use reasonable efforts to work with Client to find an alternative solution. 2. PRODUCT COVERAGE BBH s FXSI product authorizes BBH to automatically execute FX transactions related to Client s underlying security transactions and/ or corporate action events based on Client-designated criteria delineated in the attached Appendices. BBH offers FXSI to support the following activities: A. Security Transactions: BBH offers FXSI only for Receives vs. Payment ( RVP ) and / or Delivers vs. Payment ( DVP ) security transactions. FXSI cannot be applied to Free Deliver ( DEL ) security transactions and/or Free Receive ( REC ) security transactions. The Client must complete and submit an Appendix A to add, delete, or amend FXSI for security transactions. Appendix A requires the Client to designate the following criteria: (a) Participating account(s); (b) Base currency: The currency to be sold to fund RVPs and purchased with the proceeds from DVPs; (c) Applicable currencies; (d) Transaction type (RVP and/or DVP); (e) Trade Eligibility: The Client can choose between three Trade Eligibility options: i) FX - this applies FXSI to DVP/RVP security transactions for both equity and fixed income securities, as classified in BBH s security master file; ii) EQ - this applies FXSI to DVP/RVP security transactions for equity securities only, as classified in BBH s security master file; iii) NI - BBH supports the ability for clients to instruct FX requests on a transactional basis (and not via an FXSI) subject to correct formatting and data content requirements ( Needs Instruction ). Such requests may be submitted via SWIFT MT541/ MT543 via tag 11A, 22f or 70e, via BBH s proprietary website BBH WorldView ( BBH WorldView ), fax instructions and other agreed upon trade instruction mediums. Clients wishing to instruct on a Needs Instructions basis should contact their Client Service Manager CSM to discuss required protocol and formatting considerations. (f) Execution Method: The Client can choose among three execution methods: i) Individual - FX for each individual transaction; ii) Net - Net FX for RVP and DVP security transactions for the same BBH account, settlement date and currency; or iii) Bulking - Bulk FX for security transactions for the same account, settlement date and currency for both RVP and DVP transactions, respectively, i.e., one FX for RVPs and one FX for DVPs. - When the Client chooses either the Net or Bulking execution method, the BBH FXSI system will net or bulk all relevant underlying transactions to arrive at one FX transaction before releasing the FXSI transactions to the BBH desk for execution. Netting or bulking is applied at a Client s individual custody account level for all eligible transactions with the same currency pair and value date. Netting or bulking is not available in certain markets as delineated in Appendix A based upon requirements of local law, applicable market regulations, and market restrictions. (g) Timing of FX Initiation: For FXSI for security transactions, it is the designated status code on BBH WorldView upon which the BBH FXSI system will initiate the FX for further processing such as netting, bulking, and execution in accordance with the above criteria and corresponding Appendix A. i) RVP transactions: The FX will be initiated Upon Receipt of RVP transactions- i.e., when trade is designated as Pending 1 on BBH WorldView - in order to fund the security purchase on settlement date. ii) DVP transactions: The Client can choose between the following for DVP transactions: - Upon Receipt - The FX will be initiated when the trade is designated as Pending 1 on BBH WorldView. This option is not available in certain markets as delineated in Appendix A based upon requirements of local law, applicable market regulations, market restrictions, and market conditions. - Upon Settlement - The FX will be initiated when the trade is designated as Settled 2 on BBH WorldView with a value date dependent upon the local market guidelines for foreign exchange (usually one to two business days after the trade is Settled). Brown Brothers Harriman Page 3

4 FXSI Client Operating Guide - BBH & Co. 1 Pending status refers to the designation of the trade as Pending on BBH WorldView. T his status excludes trades in Repair status (as defined in note 3, below). For FXSI initiated for trades listed in Pending status, any risk, including market risk, associated with reversing an FX or an erroneous trade will be borne by the Client. In addition, any costs and risks associated with FX executed on transactions in Pending status where the shares are unavailable - e.g., as a result of the shares 1 ) being on loan; 2 ) being out for registration; 3 ) undergoing a corporate action event; or 4 ) being held in restricted status -shall be borne by the Client. 2 Settled status refers to the designation o f the trade as Settled on BBH WorldView. 3 Repair status refers to the designation of a trade on BBH WorldView as needing repair. Issues triggering Repair status include but are not limited to: improperly formatted trades, trades with incomplete instruction, trades undergoing position verification, etc. (h) Effective Date for FXSI for security transactions is the date prior to which the BBH FXSI system will begin or cease to initiate the FX in accordance with the Timing of FX Initiation selected in the corresponding Appendix A and described in Section 2A(g) of this Guide. Unless otherwise agreed, the BBH FXSI system will begin or cease initiation at 5PM Eastern Time ( ET ) on the day prior to the Effective Date based on time differences across global FX markets. The Effective Date is not directly tied to the trade date or settlement date of the underlying security transaction, but is driven by the timing of when the DVP/RVP transaction is in an eligible trade status on BBH WorldView per the Timing of FX Initiation selected in Appendix A. The Effective Date may not be fewer than two full business days from submission of Appendix A to BBH by the Client. Example 1: Client submits an Appendix A to add a new currency for both RVP and DVP transactions with an Effective Date of January 6, 2014 and selects Upon Settlement as the Timing of FX Initiation for DVP transactions. BBH will only initiate the FX for RVP transactions that become designated as Pending and DVP transactions that become designated as Settled on or after 5:00 PM ET on January 5, Example 2: Client submits an Appendix A to add a new currency for both RVP and DVP transactions with an Effective Date of January 6, 2014 and selects Upon Receipt as the Timing of FX Initiation for DVP transactions. BBH will only initiate the FX for RVP and DVP transactions that become designated as Pending on or after 5:00 PM ET on January 5, Example 3: Client submits an Appendix A with an Effective Date of January 6, 2014 to delete a currency for both RVP and DVP transactions with Upon Settlement as the Timing of FX Initiation for DVP transactions. BBH will not initiate the FX for RVP transactions that become designated as Pending and DVP transactions that become designated as Settled on or after 5:00 PM ET on January 5, 2014; even if the trade date of the corresponding security transaction was January 5, 2014 or prior. Example 4: Client submits an Appendix A with an Effective Date of January 6, 2014 to delete a currency for both RVP and DVP transactions with Upon Receipt as the Timing of FX Initiation for DVP transactions. BBH will not initiate the FX for RVP and DVP transactions that become designated as Pending on or after 5:00 PM ET on January 5, 2014; even if the trade date of the corresponding security transaction was January 5, 2014 or prior. B. Income and Reorganization Repatriation and Reorganization Funding (associated with corporate action events): BBH offers FXSI for the corporate action events delineated on Appendix B. Associated SWIFT codes corresponding to action event types are delineated in Appendix C. (a) The Client must complete and submit an Appendix B to add, delete or amend FXSI for corporate action events. The Client must define the following criteria for such FXSI: - Participating account(s) - Base currency - Corporate action events - Applicable currencies - Effective Date (b) Appendix B: provides the currencies and events eligible for Repatriation and Funding (c) Effective Date for FXSI in connection with corporate action events is the date upon which the BBH FXSI system will begin or cease to initiate the FX in accordance with the Timing of FX Initiation selected in the corresponding Appendix B Example 1: Client submits an Appendix B to add a new currency for Income repatriation with an Effective Date of January 6, BBH will facilitate the FX for Income payments received on or after January 6, 2014 for the newly added currency. Payments received for Income events in the currency paid prior to January 6, 2014 are not covered under the new request. Example 2: Client submits an amended Appendix B to add a new currency for Reorganization events with an Effective Date of January 6, BBH will facilitate the FX for Reorganization event payments received on or after January 6, Payments received for Reorganization events in the currency paid prior to January 6, 2014 are not covered under the new request. Brown Brothers Harriman Page 4

5 FXSI Client Operating Guide - BBH & Co. 3. SUBMITTING & PROCESSING FXSI REQUESTS A. Security Transactions (Equity and Fixed Income): New BBH Head Account (New Fund Launch/New Relationship Launch) (a) The Client must deliver a completed Appendix A via to BBH FX Services (FX.Standing.Instructions@BBH.com) two full New York business days before their requested Effective Date. (b) BBH FX Services will review the Appendix A upon receipt: - If the Appendix A is deemed complete for further processing, BBH FX Services will provide an acknowledgement confirmation by stamping, signing and faxing the Appendix A to the fax number provided by the Client. - If the Appendix A is deemed incomplete for further processing, BBH FX Services will call the Client to resolve the discrepancies and instruct the Client to a revised Appendix A back to BBH. - For a re-submitted Appendix A, the Effective Date shall be the updated date indicated by the Client on the resubmitted Appendix A, which in no event shall be fewer than two full New York business days from date of re-submission. B. Income and Reorganization Repatriation and Reorganization Funding: New BBH Head Account (New Fund Launch/New Relationship Launch) (a) The Client must deliver a completed Appendix B via fax to BBH, Attention: Corporate Actions Department, at (617) two full New York business days before their requested Effective Date. (b) BBH Corporate Actions will review the Appendix B upon receipt: - If the Appendix B is deemed complete for further processing, BBH Corporate Actions will provide an acknowledgement confirmation by stamping, signing and faxing the Appendix B to the fax number provided by the Client. - If the Appendix B is deemed incomplete for further processing, BBH Corporate Actions will contact the Client to resolve the discrepancies and instruct the Client to submit a revised Appendix B back to BBH. - For a re-submitted Appendix B, the Effective Date shall be the updated date indicated by the Client on the resubmitted Appendix B, which in no event shall be fewer than two full New York business days from date of re-submission. Existing BBH Head Account (Add, Amend or Delete FXSI) The Client must deliver a completed Appendix B via fax to BBH Corporate Actions at (617) two full New York business days before their requested Effective Date. BBH Corporate Actions will follow the process described in Section 3B(b) noted above upon receiving the Appendix B. Once the Appendix B is reviewed and deemed complete for further processing, BBH will then fax an Accept Confirmation to the Client detailing the FXSIs established for the client, and associated information as provided in Appendix B. For requests that are deemed incomplete for further processing, BBH will contact the Client to resolve the discrepancies and instruct the Client to submit a revised Appendix B back to BBH. The Income and Reorganization Repatriation and Reorganization Funding FXSI shall go into effect two full New York business days after BBH provides the Client with the Accept Confirmation (the Corporate Action Effective Date ). The Client is responsible for reviewing the Accept Confirmation and must notify BBH within 24hrs of Client s receipt of such confirmation with any discrepancies. The Accept Confirmation issued by BBH will be deemed correct and remain in effect until a new Accept Confirmation is generated in accordance with the procedures above. Amendments to existing FXSI submitted by Client to BBH via a revised Appendix B will be captured for a particular corporate action event if the Corporate Action Effective Date for the resubmitted Appendix B is prior to the FX initiation for that event. C. Transmissions: Since transmissions through the Internet, which is an open, freely accessible portal/network, is not a guaranteed method of delivery, it may be susceptible to loss of information, errors, misdelivery or mistransmission, including, inter alia, communications not reaching BBH, delivery delays (including without limitation, those resulting from BBH s systems, networks, processes or procedures), partial or non-receipts, deletions in error (including without limitation, those resulting from BBH s systems, networks, processes or procedures), and unwanted access by third parties in such forms including, but not limited to, viruses, falsification, forgery and misuse of data. Brown Brothers Harriman Page 5

6 FXSI Client Operating Guide - BBH & Co. The Client will use commercially available virus checking software to check communications to BBH for any virus, or other program designed to disable, erase or otherwise harm BBH s hardware, software or data ( Virus or Viruses ) and if any Viruses are found, the Client must not transmit such communications until all Viruses detected have been eliminated. Neither the authenticity nor the integrity of an message can be guaranteed. As such, any communications transmitted by the Client via shall be for the Client s sole account and risk. BBH will not be responsible for verifying and authenticating with any person the communications received via by BBH, and BBH may conclusively rely on all such purportedly sent by the Client. 4. FX SETTLEMENT DATE AND EXECUTION A. Security Transactions: FXSI transactions will be initiated when security instructions from the Client become designated as Pending or Settled status on BBH WorldView with an FX settlement date in accordance with the settlement date of underlying security instruction and the Timing of FX Initiation criteria selected. B. Income and Reorganization Repatriation and Reorganization Funding: Income and Reorganization Repatriation: In accordance with the completed Appendix B: FXSI will be initiated upon receipt of entitlement for spot FX settlement (pay date +2); The local currency will be available upon receipt and the purchased base currency will be available on settlement date of the FX. Reorganization Funding: BBH will initiate an FX for the funding cost with a settlement date equal to that of the funding date in the local market; On value date of the FX, the Client s local currency account will be credited with the necessary proceeds required per the terms of the offer; The local currency will be debited with the value date of the debit/funding date under the terms of the offer once the local market debits the funds from the clients account. FX Execution: In markets where BBH executes FXSI transactions as principal, as indicated in Appendices A and B, BBH generally executes transactions corresponding to items under Sections 4A and 4B based on designated sweep and execution times. Sweep times are typically 30 minutes prior to execution times for freely tradable markets and vary in restricted markets due to numerous factors including, but not limited to, the instruction time limited FX market hours, applicable regulatory or approval processes, and market conditions. Under normal market conditions, eligible FXSI transactions received by BBH s FX desk by the designated sweep times will be executed by BBH s FX desk at the next applicable execution time. Any applicable pre-execution netting or bulking will also take place at the sweep times prior to execution. Netting is not applicable to corporate actions related FXSI activity under Section 4B. As sweep and execution times are subject to change, please contact your BBH client service representative for details on sweep and execution times. In markets where BBH executes FXSI transactions as the Client s agent with the local subcustodian, as indicated in Appendices A and B, sweep and execution times vary due to numerous factors including, but not limited to, the instruction time FX market hours, applicable regulatory or approval processes, and market conditions. Netting is not applicable to FXSI transactions in markets where BBH executes as agent. The initiation of an FXSI transaction does not guarantee that the FX will be executed by BBH as principal or agent or that the value will be obtained on the relevant settlement date. Factors impacting execution include, but are not limited to, market restrictions, currency devaluation, illiquidity or any other economic instability. BBH will not be liable for any inability to execute an FX as principal or agent, or for any other delays in processing or execution of FX related to security transactions beyond BBH s control. In addition, BBH will not accept responsibility for any intra-day fluctuations in exchange rates that may cause a potential gain or loss to the Client from the timing of execution of FX related to a security transaction. 5. OVERRIDE INSTRUCTIONS A. Security Transactions: Due to the complexity of processing FXSI, the Client will not be able to override their FXSI for security transactions. B. Income and Reorganization Repatriation and Reorganization Funding: The Client should use Appendix D to override their Income and Reorganization Repatriation and Reorganization Funding FXSI on an individual transaction basis. All subsequent Income and Reorganization Repatriation and Reorganization Funding events will be executed based upon the FXSI submitted prior to the override instruction. Brown Brothers Harriman Page 6

7 FXSI Client Operating Guide - BBH & Co. (a) Income and Reorganization Repatriation Override: BBH must receive a complete and accurate Appendix D no later than three (3) full New York business days prior to the cash credit date stated in the terms of the event offer. (b) Reorganization Funding Override: - Mandatory Events: BBH must receive a complete and accurate Appendix D no later than eligibility date of the corporate event; - Voluntary and Mandatory Election Events: BBH must receive a complete and accurate Appendix D on the same New York business day that BBH receives the election. BBH will use reasonable efforts to execute late override instructions -i.e., those received after the deadlines for submission of Appendix D indicated in (a) and (b) above, including override instructions re-submitted due to an incomplete or inaccurate original submission, but cannot guarantee that such late instructions will be executed. The Override Acceptance Process is as follows: 1. BBH will send an acknowledgement of receipt to the Client upon receipt of an override instruction to the fax back number indicated on Appendix D. The Client is responsible for ensuring receipt of an acknowledgement confirmation from BBH. The acknowledgement confirmation confirms receipt of, but not action taken on, an override request. 2. BBH will confirm to the Client upon processing an authorized override request by fax by issuing an Accept Confirmation. 3. An incomplete or ineligible (as defined in section 5B (a) and (b)) override instruction will be placed in Repair status and returned to the Client for clarification or amendment. BBH will contact the Client directly on any conflicting or incomplete override instruction. It is the Client s responsibility to resolve any discrepancies on the same business day3. 4 Once the Repair condition has been corrected via an amended override instruction, BBH will then confirm back to the Client upon processing 4. FX will be executed based on existing FXSI for any override instructions which do not meet the criteria in Section 5B. 4 If an amended override instruction is not received within 24 hours of the original incomplete or ineligible override instruction, BBH will not process the original override instruction and any existing FXSI will remain in effect. 6. RESPONSIBILITIES A. Account Maintenance and Reconciliation: Once an FX trade is executed, BBH will debit the Client s base cash or local currency account for the amount sold in the FX transaction on the actual value date of FX. The Client will be responsible for ensuring sufficient funds are available in the base cash or local currency account to cover all executed FX transactions. BBH will not be responsible for any overdraft interest incurred as a result of an FXSI execution. The Client is responsible for monitoring cash in the Client accounts and actively reconciling all activity related to any cash balances in accounts set up for FXSI. The Client may access details relevant to executed FXSI transactions through BBH WorldView. Such details are made available by BBH following execution and shall constitute an acknowledgment/confirmation of the transactions. The Client may also request additional forms of FXSI notifications on a daily or transactional basis. Executed FXSI transactions shall be deemed confirmed unless the Client notifies BBH of any discrepancies within 24 hours from when execution details are made available on BBH WorldView. BBH will use reasonable efforts to work with the Client to resolve any such discrepancies. B. Reconciliation Reporting: Security Transactions: BBH will send an FXSI Security Transaction Account Summary Report ( FXSI Account Summary Report ) to the Client via on an annual basis. The Client is responsible for utilizing the FXSI Account Summary Report to reconcile their FXSI for security transactions. If a discrepancy is noted, or a change required, the Client must complete and an Appendix A to BBH at FX.Standing. Instructions@bbh.com to resolve any discrepancies/submit a change. The existing FXSI will be deemed correct until a new Account Summary Report is generated in accordance with the procedures described in Section 3A. In the absence of instructions to the contrary, existing FXSIs will be deemed to be valid and accurate. Income and Reorganization Repatriation and Reorganization Funding: BBH will send an FXSI Income and Reorganization Repatriation and Reorganization Funding Summary Report ( Corporate Action Summary Report ) to the Client via on an annual basis. The Client should use the Corporate Action Summary Report to reconcile their FXSI for Income and Reorganization Repatriation and Reorganization Funding. The Client must fax an Appendix B to BBH, Attention: Corporate Actions Department, to resolve any discrepancies. The existing FXSI will be deemed correct until a new Accept Confirmation is generated in accordance with the procedures described in Section 3B. In the absence of instructions to the contrary, existing FXSIs will be deemed to be valid and accurate. Brown Brothers Harriman Page 7

8 FXSI Client Operating Guide - BBH & Co. 7. LATE SECURITY TRANSACTION INSTRUCTIONS BBH s process to identify security transactions eligible for FXSI is driven by our ability to capture security transactions listed in Pending status on BBH WorldView. When a client instructs BBH to execute the FX Upon Receipt (as defined in Section 2A of this Guide) of the security transaction instruction, there exists the potential for the status of a security transaction for which BBH receives late instructions 5 from the Client to move from Pending to Settled status instantaneously in BBH WorldView. This instantaneous change in status could prevent BBH from effectively capturing the security transaction in order to execute the foreign exchange. 5 Late instructions on security transactions may include but are not limited to instructions pertaining to security transactions submitted by the Client on or after contractual settlement date or to security transactions that are in Repair 8. FX CANCELLATIONS A. Security Transactions: Please be advised that amendments to security transactions that are not properly coded per International Securities Association for Institutional Trade Communication ISITC standards regarding treatment of FX transactions could lead to possible FX errors. Multiple corrections to the same security transaction increase the chance for an FX to be duplicated or cancelled in error if not properly instructed. It is highly recommended that BBH Clients follow ISITC standards related to MT54x trade cancel messages with regard to FX instructions. If Clients are unable to follow these industry standards, they should promptly notify BBH via an to FX.Standing. Instructions@bbh.com with their intentions toward the FX trade. If BBH is not notified, BBH will make reasonable efforts to reconcile the trade cancellation(s) to the underlying FX transaction. In no event shall BBH be responsible for losses arising from Client s failure to follow the ISITC standards or for Client s failure to notify BBH in a timely manner of Client s intentions toward the FX trade. a) If the Client elects to cancel a security transaction subsequent to the execution of the corresponding FX then the Client must instruct BBH, either via SWIFT MT541/543 tag 22f or telephone (with a subsequent to FX.Standing.Instructions@BBH.com), to either retain the FX or execute a contra, reversal FX. The Client should contact BBH if they have any questions regarding SWIFT standards or formats. b) The Client should provide instruction to BBH as to how to apply the retained FX to another security transaction or to a partial settlement of the original transaction. If the Client doesn t provide instructions then BBH will use reasonable efforts to identify a rebook security transaction or partial settlement to apply the FX proceeds. c) If there is a difference in the amount of the original FX and the new security transaction, and the Client has elected to retain the FX, then BBH will execute an FX at the prevailing market rate for the difference. d) If the settlement date of a new DVP transaction is after the value date of the original FX then BBH will change the value date of the FX to correspond with the settlement date of the DVP transaction to avoid an overdraft in the Client s account. e) If the settlement date of a new RVP transaction is before the value date of the original FX then BBH will change the value date of the FX to correspond with the settlement date of the RVP transaction to avoid an overdraft in the Client s account. f ) In the event the Client cancels a security transaction and does not provide instructions to either retain the FX or execute a contra, reversal FX then BBH shall contact the Client to verify further instructions. If BBH contacts the Client before 12pm ET and does not receive an instruction by 9:00am ET the following New York business day then BBH will execute a contra, reversal FX. If BBH contacts the Client after 12pm ET and does not receive an instruction by 12pm ET the following New York business day then BBH will execute a contra, reversal FX. The Client will be responsible for any gain or loss from the contra, reversal FX transacted in accordance with the above processes as a result of exchange rate fluctuations. g ) In the event that the Client deletes an account or currency from their existing FXSI and subsequently cancels a security transaction for which an FX was executed pursuant to their previous FXSI, BBH will take no action on the executed FX in response to the cancellation and the client is fully responsible for promptly notifying BBH via an to FX.Standing.Instructions@bbh.com with their intentions toward the FX trade. B. Amendments to Income and Reorganization Repatriation and Reorganization Funding: When a reversal of a previously executed FX for an Income and Reorganization Repatriation or Reorganization Funding event is requested due to an amendment to either the income amount or to the funding amount of a particular corporate action event, a contra FX will be initiated for the difference between the correct and incorrect amount of the FX and the Client will be responsible for any gain or loss from the contra FX as a result of exchange rate fluctuations. BBH will apply the FXSI in place at the time of the original FX to the reversal. 9. FXSI ACTIVITY NOTIFICATIONS The Client may access details relevant to executed FXSI transactions through BBH WorldView. Such details are made available by BBH following execution and shall constitute an acknowledgment/confirmation of the transactions. The Client may also request the below additional forms of FXSI notifications on a daily or transactional basis. Executed FXSI transactions shall be deemed confirmed unless the Client notifies BBH of any discrepancies within 24 hours from when execution details are made available on BBH WorldView. BBH will use reasonable efforts to work with the Client to resolve any such discrepancies. Brown Brothers Harriman Page 8

9 FXSI Client Operating Guide - BBH & Co. A. Security Transactions: BBH can send a daily FXSI Trade Activity Report via to the Client (address provided on the Appendix A). As an alternative, the Client may submit an MT300 notification Request Form (Appendix E) if they would like to receive MT300 notifications in addition to, or instead of, the FXSI Trade Activity Report. B. Corporate Actions: Corporate action payment notifications and the associated FX are available on a real time basis at the account level via BBH s proprietary website BBH ActionView. In addition, the Client may submit an MT300 notification Request Form (Appendix E) if they would like to receive MT300 notifications. 10. PRODUCT EXCEPTIONS/CLARIFICATIONS A. FXSI does not cover principal proceeds from maturities and redemptions. The Client will receive principal proceeds from maturities and redemption payments in local currency. B. FXSI for voluntary reorganization events will be processed and executed at the instruction level. BBH will execute an FX for each election that the Client submits. For example, if a Client submits two partial elections on the same account for the same event, two individual FXs will be executed. C. FXSI for Income or Reorganization services will be executed based on the currency designated by the Client in Appendix B regardless of whether the Client has separately elected a particular currency in connection with any specific income or reorganization event. D. Oversubscription: If the over subscription results are unknown on the subscription funding date in the market, BBH will initiate an FX for the entire elected position. Upon market confirmation of the final subscription results, BBH will not reverse the FX in the event of an oversubscription unless instructed by the Client (see Section 8B). The Client will be responsible for any exposure or loss resulting from fluctuations in the FX rate. E. If the funding date or the details of a corporate action event change after the announced funding date, BBH will not reverse the FX unless instructed by the Client (see Section 8B). The Client will be responsible for any exposure or loss resulting from fluctuations in the FX rate. F. If the funding date for a reorganization or the settlement date for an RVP transaction falls on a bank holiday for either the base or local currency, then BBH will book the FX for value one business day prior to the holiday. If the payment date for an income event or the settlement date for a DVP transaction falls on a bank holiday for either the base or local currency, then BBH will book the FX for value on the next available business day. G. BBH reserves the right to decline to act on FXSI in various currencies based upon, among other things, requirements of local law, applicable market regulations, market restrictions, market conditions or terms of a corporate event and will provide reasonable notice to the Client of its determination not to act where practical. The Client acknowledges that certain markets have operational or compliance requirements which may require the submission of documentation to BBH or the relevant subcustodian in order to execute FX. The current list of eligible currencies and any applicable restrictions on FXSI for Security Transactions can be found on Appendix A. The current list of eligible currencies and any applicable restrictions for the FXSI for Corporate Actions can be found on Appendix B. H. Handling of potential duplicate instructions for security transactions A trade is determined a possible duplicate if all of the following criteria is an exact match. In the event BBH identifies a potential duplicate security transaction based on this criteria, BBH will reach out to the Client to confirm if these trades are valid prior to executing the FXs.: Head Account Number; RVP/DVP, security, share amount, net currency amount and value date See below for examples. Example A: BBH will contact Client for clarification PD UM RVP 2,138,600 TABLEROS Y MADERAS DE CAL/CO 04/29/ CO ,404, COP PD UM RVP 2,138,600 TABLEROS Y MADERAS DE CAL/CO 04/29/ CO ,404, COP Brown Brothers Harriman Page 9

10 FXSI Client Operating Guide - BBH & Co. Example B: BBH will initiate the FX for both trades PD MA RVP 32,500 MEDORO RESOURCES LTD /CAD/ 04/27/ CA B15NRZ4 62, CAD PD MA RVP 32,500 MEDORO RESOURCES LTD /CAD/ 04/27/ CA B15NRZ4 62, CAD In the event of a deviation in any of the above fields, both trades will be deemed valid individual trades and processed as per the standing instructions. By submitting Appendix A, B, D or E to BBH, the Client acknowledges their agreement with the terms and conditions of this Guide, as may be amended from time to time. BBH shall provide notice of any material change to this Guide via BBH WorldView at least ten (10) business days prior to it taking effect, unless BBH determines that the circumstances require that a shorter period apply. The Client s participation in BBH s FXSI program, and the FX transactions thereto, shall be governed by the modified Guide on or after the effective date of such changes, as stated in the applicable notice. Brown Brothers Harriman Page 10

11 BBH Foreign Exchange Standing Instructions (FXSI) Client Operating Guide appendix a foreign exchange standing instructions (fxsi) request form for security transactions (dvp/rvp) bbh fx services standing instructions address: fx.standing.instructions@bbh.com bbh fx services standing instructions contact number: By submitting this Appendix A, the Client has reviewed and acknowledged their agreement with the terms and conditions of the Foreign Exchange Standing Instruction (FXSI) Client Operating Guide. All FXSI Requests must be ed to BBH FX Services (FX.Standing.Instructions@BBH.com ) two full New York business days before the requested Effective Date. fxsi effective date: (mm/dd/yy) authorized representative name (primary) authorized representative number (primary) address for confirmation (primary) authorized representative name (secondary) authorized representative number (secondary) address for confirmation (secondary) fax number for confirmation CLICK ON THE BELOW COLUMN HEADER FOR DEFINITION. PLEASE REFER TO THE FXSI GUIDELINES TAB FOR FURTHER CLARIFICATION. BBH ACCOUNT BASE CURRENCY BBH ACCOUNT BASE CURRENCY BBH ACCOUNT BASE CURRENCY PLEASE REFER TO THE FXSI GUIDELINES FOR COMPLETING THE FOREIGN EXCHANGE STANDING INSTRUCTIONS (FXSI) REQUEST FORM FOR SECURITY TRANSACTIONS (DVP / RVP) TAB FOR FURTHER CLARIFICATION. Brown Brothers Harriman Page 1

12 BBH Foreign Exchange Standing Instructions (FXSI) Client Operating Guide When establishing FXSI, BBH and the Client will adhere to all market regulations and/or restrictions. In instances where the Client s request contradicts a specific market practice, the FXSI will be arranged as mandated by that particular market. Additionally BBH reserves the right to suspend or eliminate any market/currency from its FXSI product offering. These situations would typically be driven by, among other things, changes with local law, applicable market regulations, market restrictions, and market conditions- BBH will promptly notify Client of any such suspension or elimination and use reasonable efforts to work with Client to find an alternative solution. Authorized Client Signature: add amend delete *Please note if there is not a drop down option available, then the indicated entry is the mandatory default choice UNRESTRICTED CURRENCIES TRANSACTION TYPE TRADE ELIGIBILITY EXECUTION METHOD TIMING OF FX INITIATION AUD CAD CHF CNH CNH Hong Kong Stock Connect CZK DKK EUR GBP HKD HUF ILS JPY MXN NOK NZD PLN RON SEK SGD TRY USD ZAR DVP & RVP All Trades CNH: BBH only supports CNH security transactions that settle in Hong Kong such as Dim Sum Bonds via the FXSI Program. Due to early and/or unique funding requirements, CNH FXSI s are not available for foreign investments which settle in mainland China including A-Shares under the QFII (Qualified Foreign Institutional Investor), RQFII (Renminbi Qualified Foreign Institutional Investor), or CIBM bond offerings. CNH Hong Kong Stock Connect: BBH supports CNH FX execution via the FXSI program for Stock Connect security transactions that settle in Hong Kong through the Integrated and Enhanced access models. This standing instruction cover both the Shanghai and Shenzen models jointly and does not support them individually unless the client opens separate safekeeping accounts in the market for both Shanghai and Shenzen Stock Connect. Clients must have an open Stock Connect custody account in order to participate in this FXSI. The FXSI will apply to all RVP and DVP trades and tag 11A is not permitted. Please see page 6 of the FXSI COG Appendix A for further details on this standing instruction. Brown Brothers Harriman Page 2

13 BBH Foreign Exchange Standing Instructions (FXSI) Client Operating Guide RESTRICTED CURRENCIES TRANSACTION TYPE TRADE ELIGIBILITY EXECUTION METHOD TIMING OF FX INITIATION Brown Brothers Harriman Page 3 AED Individual Upon Settlement ARS* RVP Only Individual N/A BGN BRL Individual CLP Individual Upon Settlement COP Individual Upon Settlement EGP Individual Upon Settlement HRK Individual Upon Settlement IDR Individual INR* Individual Upon Settlement ISK* RVP Only Individual N/A KES Individual Upon Settlement KRW Individual LKR Individual Upon Settlement MAD MYR Individual Individual PEN* Individual Upon Settlement PHP Individual QAR Individual Upon Settlement RSD Individual Upon Settlement RUB* Individual Upon Settlement THB TWD* Individual UYU Individual Upon Settlement VND* DVP Only Individual Upon Settlement ARS-RVP Only: BBH only supports ARS-RVP via the FXSI Program. ARS-DVP repatriation is not available due to the capital controls in place. Repatriation requests can no longer be processed without central bank approval and extensive documentation must be provided to the local subcustodian verifying the authenticity of the funds. Additionally foreign investors are subject to an additional 30% cash reserve requirement on FX inflows which will be applied through the standing instruction. INR-RVP: Due to the mandatory margin requirement for Indian equities, there is an early funding requirement for security purchases which is satisfied through FXSI by executing the funding FX for value SD-1. ISK-RVP Only: BBH only supports ISK-RVP via the FXSI Program. ISK-DVP repatriation is not available due to extensive documentation required by market regulations. PEN: A tax of.01% will be applied to all FXs related to RVP and DVP transactions processed through the FXSI program. The Financial Transaction Tax (FTT) applies to all debit and credit entries to local cash accounts that result from versus payment security transactions, corporate actions and foreign exchange transactions. RUB: BBH only supports RUB FX execution via the FXSI program for security transactions that settle through international depositories such as Euroclear and Clearstream. Due to the market prefunding requirement, RUB FXSI s are not available for foreign investments which settle in local RUB brokerage accounts. TWD: BBH supports TWD-RVP via the FXSI Program when an agreement has been established with your local broker(s) to waive the pre-verification of funds. Foreign investors are able to establish arrangements with their brokers whereby they can agree to waive the Pre-Verification Check and execute security purchases without performing the check or having TWD in their cash account. Under this arrangement, the corresponding FX can then be carried out after the security trade is executed. Funding must be in place by SD-1 in order to satisfy the early trade affirmation process. Please see the TWD procedures located at the end of this appendix. VND-DVP Only: BBH only supports VND-DVP via the FXSI Program. VND-RVP is not available due to prefunding requirements. Pre-funding of a foreign currency or VND is required for security trade execution in order to comply with market practice where the broker will confirm availability of funds prior to execution of security trades.

14 BBH Foreign Exchange Standing Instructions (FXSI) Client Operating Guide AGENCY CURRENCIES TRANSACTION TYPE TRADE ELIGIBILITY EXECUTION METHOD TIMING OF FX INITIATION BDT* Individual Upon Settlement BHD Individual Upon Settlement BWP Individual Upon Settlement GHS Individual Upon Settlement JOD Individual Upon Settlement KWD Individual Upon Settlement MUR Individual Upon Settlement NAD Individual Upon Settlement NGN Individual Upon Settlement OMR Individual Upon Settlement PKR Individual Upon Settlement RWF Individual Upon Settlement TND Individual Upon Settlement TZS Individual Upon Settlement UGX Individual Upon Settlement XOF* Individual Upon Settlement ZMW Individual Upon Settlement BDT-RVP: Because local banks are not permitted to extend credit facilities to foreign investors, there is a prefunding requirement which is satisfied by executing security related FX purchases for value SD-1. XOF-RVP: Due to the early security share and cash settlement process in the Ivory Coast, there is a prefunding requirement for security purchases which is satisfied through FXSI by executing the FX for value SD-1. Brown Brothers Harriman Page 4

15 BBH Foreign Exchange Standing Instructions (FXSI) Client Operating Guide TWD FXSI PROCEDURES FOR RVP S WHEN PRE-VERIFICATION CHECK HAS BEEN WAIVED: By selecting an FXSI setup for RVP transactions in Taiwan, Client acknowledges they have waived the pre-verification with their brokers and agree with the following operational procedures which BBH will utilize to execute their FX purchases of Taiwanese Dollar ( TWD ) corresponding to their RVP activity. PROCEDURES: Upon receipt of the underlying RVP transaction on TD by 4:00 p.m. EST, BBH will take the following action: 1. Security Purchases (RVPs) without holidays: A. Due to the broker affirmation requirement on T+1, BBH will execute the FX with our subcustodian and Client on TD+1 for same day value. 2. Security Purchases (RVPs) where TWD funding is required on base currency holidays (base currency holiday equal to TD+1): A. Due to the broker affirmation requirement on T+1, BBH will execute the FX with the subcustodian versus a non-holiday cur rency for value TD+1. B. BBH will execute an FX with the Client versus their base currency for value TD due to the base currency holiday on TD Security Purchases (RVPs) on working Saturdays & Christmas in Taiwan (Saturday/Christmas equal to TD+1 of TWD transaction): A. In both scenarios we have established exception procedures with our local subcustodian(s) where BBH will execute the FX with them either before or on SD for value SD. B. In both scenarios, BBH will also execute the FX with the Client for value SD. WATCH LIST SECURITIES: The above procedures will not apply to any RVP related to a security that is considered to be on the Watch List as requirements to facilitate settlement of these transactions require different procedures. A security may be placed on the Watch List due to high trading volumes, price movements, price earnings ratios, price-to-book ratios or a high stock turnover rate. To purchase a security on the Watch List, an investor must provide the broker with at least half of the cash before the security trade order can be executed on Trade Date. 4. Security Purchases (RVPs) for Watch List securities: A. Client should discuss the pre-funding details with their broker and instruct a separate FX instruction in order to have sufficient TWD available on Trade Date prior to the purchase of the Watch List security. B. Once their Watch List security purchase is executed, Client should notify the BBHFX Standing Instructions Team via (fx.standing.instructions@bbh.com) on Trade Date no later than 4:30 PM EST and provide details of the pre-funded FX and corresponding security trade (security, share amount, value date, TWD amount) to ensure the FX is not duplicated based on the underlying RVP instruction that BBH will receive on Trade Date. C. BBH will not be liable for any costs associated with unwinding duplicate FX transactions if the Client fails to provide notification indicating that the FX, or at least a portion of it, has already been executed. WATCH LIST EXCEPTIONS In the event that the Client is not aware they have instructed their broker to purchase a Watch List security, BBH will coordinate closely with our subcustodian and execute an FX (if required) to ensure sufficient pre-funding is in place to purchase the security on Trade Date. If the subcustodian instructs BBH to execute an FX on behalf of Client to fund for a security on the Watch List, BBH will provide the FX details and any available security details to the Client on Trade Date. The BBHFX Standing Instructions Team will exclude the corresponding security trade (security, share amount, value date, TWD amount) from the standing instructions program to ensure the FX is not duplicated based on the underlying RVP instruction that BBH will receive on Trade Date. In the event that additional funding is required to purchase the Watch List security, Client must instruct an FX either via fax or phone call into the BBH FX Trading desk. Brown Brothers Harriman Page 5

16 BBH Foreign Exchange Standing Instructions (FXSI) Client Operating Guide FXSI FOR HONG KONG STOCK CONNECT COVERAGE: 1. The FX Standing Instruction for Hong Kong Stock Connect (Stock Connect) is executed through a joint reconciliation process between BBH and the subcustodian. This standing instruction cover both the Shanghai and Shenzen models jointly and does not support them individually unless the client opens separate safekeeping accounts in the market for Shanghai and Shenzen Stock Connect. Clients must have an open Stock Connect custody account in order to participate in this FXSI. Due to the comprehensive nature of this reconciliation, this standing instruction will apply to all RVP and DVP trades executed through the Stock Connect product and cannot be overridden through tag 11A. 2. The standing instruction will cover Integrated Model (Custody Plus) security instructions that are not cancelled and have a Settlement Date of the current or next day, whereby BBH and HSBC as the local subcustodian have reconciled the security instructions executed by the Client with HSBC the security broker by 5:00 PM HK time. 3. The standing instruction will cover Enhanced Model (SPSA) incoming security instructions that are not cancelled and have a Settlement Date of the current or next day. The security instructions must be received by BBH from the Client for Enhanced Model transactions by 4:00 PM HK time to be executed within the standing instruction. EXECUTION: 1. FXs related to Stock Connect transactions will be executed by BBH Foreign Exchange in the local market at 6:00 PM HK time after the reconciliation is performed by BBH with the local subcustodian. Client FX pricing will be performed by BBH Foreign Exchange based on the 6 PM execution. EXCEPTIONS: 1. Late trade instruction: Any new Integrated Model security instructions sent after 5:00 pm HK time will not be captured by the standing instruction and the FX will not be executed at 6:00 PM HK time. Any new Enhanced Model security instructions sent after 4:00 pm HK time may not be captured by the standing instruction and the FX may not be executed at 6:00 PM HK time. BBH FX will monitor client accounts subscribed to the HK SG Stock Connect standing instruction for late security trade instructions received after the above deadlines. In the event of a late security instruction, BBH FX will execute a FX for the Client at the next available FXSI sweep time. 2. Cancelled trade: Cancellations for Integrated Model security instructions must be received by BBH by 5:00 PM HK time to avoid FX execution. Cancellations for Enhanced Model security instructions must be received by BBH by 4:00 PM HK time to avoid FX execution. In the event the Client cancels a security transaction after the respective deadlines for each model, then BBH shall contact the Client to verify their intentions toward the FX trade. In no event shall BBH be responsible for losses arising from the Client s failure to notify BBH in a timely manner of their intentions toward the FX trade. Brown Brothers Harriman Page 6