IMPORTANT – PLEASE READ CAREFULLY: PEPPERDYNE (“PEPPERDYNE”) believes that its customers should be aware of the risks involved in entering over-the-counter contracts for foreign currency, precious metals, and contracts for difference (CFDs) (collectively, “Pepperdyne Contracts”). The following is a brief, non-exhaustive summary of certain more significant factors and special risks you should take into account when deciding whether to trade Pepperdyne Contracts. In order to open and operate a PEPPERDYNE account, you must indicate that you have read and understood this Risk Disclosure Statement (the “Statement”). Please read this Statement in its entirety and then sign below.

When you enter into a Pepperdyne Contract, you will be entering into a privately negotiated contract with PEPPERDYNE as principal. This means that PEPPERDYNE acts as the seller when you buy and the buyer when you sell. Pepperdyne Contracts are not transferrable to other providers. Both you and PEPPERDYNE are obliged to perform your respective obligations under each transaction in accordance with its terms. The terms of each Pepperdyne Contract are set out in Customer Agreement, which applies to every transaction you enter into with PEPPERDYNE.

PEPPERDYNE establishes the prices at which it offers to trade with you based on prices that are made or quoted to PEPPERDYNE by the banks, financial institutions, exchanges and counterparties with which it does business and which may not be the same as prices available from other sources. These prices depend on fluctuations in the financial markets, which are outside PEPPERDYNE’s control. Financial markets in general and these products in particular are volatile and can move rapidly, particularly in response to news events. In addition the assets underlying CFDs are different from one another and there are specific risks for each item. These assets also differ from currencies (and different currencies also carry different risks). The past performance of an underlying asset, CFD or currency is not an indicator of future performance.

There may be instances where PEPPERDYNE does not receive a price in respect of certain or all-underlying assets due to market disruption or closure. PEPPERDYNE may prohibit opening or closing a position if there is no pricing data available in respect of the underlying asset or currency. These situations involve risk for you, as there may be market changes while you are unable to trade and this could adversely affect any open positions.

In entering into Pepperdyne Contracts you should understand that PEPPERDYNE is acting solely in the capacity of an arm’s length contractual counterparty to you and not in the capacity of your financial advisor or fiduciary. Accordingly, you should not regard any information, proposal, suggested trade or trading strategy or other written materials or oral communications from PEPPERDYNE as investment recommendations or advice or as expressing PEPPERDYNE’s views as to whether a particular transaction is appropriate for you or meets your financial objectives.

Transactions in PEPPERDYNE Contracts carry a high degree of risk. The amount of initial margin is small relative to the value of the Pepperdyne Contracts so that transactions are “leveraged” or “geared”. A small market movement will have a proportionally larger impact on your position and this may work against you as well as for you. The possibility exists that you could sustain a total loss of initial margin funds and any additional deposits made to maintain your position. We recommend that you familiarize yourself with CFD and currency trading with PEPPERDYNE using a Practice account before using a real account.

In view of the risks, you should trade in Pepperdyne Contracts only if you understand the contracts (and contractual relationships) into which you are entering. Trading in PepperdyneContracts is only appropriate for sophisticated individuals and institutional investors and is not appropriate for many members of the public. You should consider whether trading is appropriate for you in light of your experience, objectives, financial resources, risk tolerance and other relevant circumstances. Most importantly, do not invest money that you are not in a position to lose.

Risks include, without limitation, the following: (i) it is possible to incur a loss if, after your acquisition of an investment, exchange rates change to your detriment, even if the price of the underlying currency to which the Trade relates remains unchanged; and (ii) you may sustain a total loss of the Margin Requirement in respect of your account that you deposit with or pay to us to establish or maintain a position and, if the market moves against you, you may be required to pay substantial additional funds at short notice but if you fail to do so within the required time, your investment position may be liquidated at a loss to you and you will be liable for any remaining deficit in your Account. Specifically, if your margin deposit is less than required to maintain the open positions in your account, then a margin closeout will occur without warning and all your open positions will be closed. In instances where the market for an open position is not currently trading, such open position will be automatically closed at the next available market price. You are responsible for monitoring your account to avoid unexpected margin calls. To limit your losses PEPPERDYNE encourages you to employ such risk-reducing strategies as “stop-loss” or “stop-limit” orders, but you should be aware that market conditions may make it impossible to close out your order at the level specified.

There are also risks associated with using an Internet-based trade execution software application including, but not limited to, the failure of hardware and software. PEPPERDYNE does not control signal power, reception, routing via the Internet, network latency, and configuration of your equipment or the reliability of your connection to the Internet. The result of any failure of the foregoing may be that your order is either not executed according to your instructions, is executed at a price that differs from the one shown or is not executed at all.