ace derivatives & commodity exchange limited

------------------------------------------------- ------- Corporate Office------------------------------------------------

Ace Derivatives and Commodity Exchange Limited 4th Floor, Building No. 4, Infinity IT Park,

Gen. A. K. Vaidya Marg, Malad (East), Mumbai 400 097 Tel: 022-66709200, Fax: 022-66709290 Website: www.aceindia.com

Circular No: ACE/C&S-004/2010/025 Date: October 26, 2010

_______________________________________________________________________________ Collateral procedure

_______________________________________________________________________________

In terms of the Bye-laws, Rules and Business Rules of the Exchange, members of the Exchange are

hereby notified regarding the

1. Margin Deposits, their components and other related processes

2. Clearing Front end

For and on behalf of

Ace Derivatives and Commodity Exchange Ltd.

Suresh Pai

Head - Market Operations

_________________________________________________________________________________

For any clarifications or assistance, please contact the Customer Service Group at 022-6670 9201 or

send us an email at services @aceindia.com

mailto:[email protected]




1. Margin Deposit Requirements

1.1. Initial Base Minimum Capital (BMC)

The members of Ace Derivatives & Commodity Exchange Limited (ACE or Exchange), are

required to deposit interest free security deposit as BMC prescribed by the Exchange at the

time of admission.

A Member is required to bring in the applicable BMC as prescribed by the Exchange before

activation as a Member. It shall be mandatory for a Member to ensure that BMC is maintained

with the Exchange at all points of time on a continuous basis till he continues as an active

member of the Exchange

Base Minimum Capital can be deposited by members with ACE in the form of

• Interest Free Cash Security Deposit, and

• Cash equivalents i.e. Bank Guarantee (BG) and Fixed Deposit Receipt (FDR)

Presently the requirement of BMC is as under

( Rs Lakh)

Member Type Cash Cash Equivalent

Trading Cum Clearing member (TCM) 2.00 6.00

Institutional Trading Cum Clearing Member (ITCM) 10.00 40.00

Professional Clearing Member (PCM) 10.00 40.00

1.1.1. Cash Security Deposit

This is payable only by way of demand draft drawn in favor of “Ace Derivatives and Commodity

Exchange Limited”, Mumbai. Alternatively, a member who has already opened settlement

account with the clearing bank of the Exchange and has not paid the BMC may request

Exchange in writing to debit the applicable BMC from his Settlement account.




1.1.2. Cash Equivalents - Cash Equivalent includes Bank Guarantee (BG) and Fixed Deposit

Receipt (FDR)

1.1.2.1 Bank Guarantees

ACE will accept Bank guarantee towards BMC as per the specified format given in

Annexure-1 issued by the ACE, from the approved banks list of which is given in as per

Annexure 2. The minimum term of the bank guarantee should be 12 months. The bank

guarantee may or may not have any claim period. If the bank guarantee does not have

any claim period then the members must submit the renewed bank guarantee at least 15

days prior to the expiry of bank guarantee failing which the benefit of exposure on such

bank guarantee will be withdrawn. However, if the bank guarantee has a claim period

(minimum 15 days) then the benefit will be extended till the date of expiry of bank

guarantee. The members must ensure that the prescribed format is used by the bank

for purpose of the issuance of bank guarantee towards BMC requirements and the Bank

guarantee be issued by the bank on behalf of the member himself / itself.

1.1.2.2 Renewal of Bank Guarantee

The member will be required to renew the bank guarantee submitted by him prior to its

expiry / before the end of the claim period as the case may be. In case of renewal of

bank guarantee, the members shall furnish the renewed Bank guarantee as per the

prescribed format. The renewal of the bank guarantee should be for a minimum period of

12 months with or without claim period. The formats to be used in case of such renewals

are given as Annexure 3.

The renewed bank guarantee / fresh bank guarantee should be submitted to ACE, 15 days

before the day on which the earlier bank guarantee is due to expire. In case the member

wishes not to renew the bank guarantee, member can request for release of Bank

guarantee. The format for release of bank guarantee is given as Annexure 4. However the

Members should ensure that Base Minimum Capital is always maintained at the minimum

prescribed level.




1.1.2.3 Fixed Deposit Receipt

Members may submit Fixed Deposit Receipts (FDRs) issued by ACE approved banks (List as

mentioned in Annexure 2). The FDR should be issued in the favor of “ACE - A/c Member

Name” and should be deposited in the safe custody of ACE. Bank should mark a lien on

the said FDR in favor of Ace Derivatives & Commodity Exchange Limited as evidenced by

the issuance of a letter by the bank. This letter should be submitted along with the fixed

deposit receipt in original along with a request letter from the member. The format of

issuance of letter by the Bank and submission of letter along with FDR by the Member is given in

Annexure 5. The FDR should be issued for a minimum period of 36 months or such other

period as may be approved by Exchange from any of the approved banks

Renewal of Fixed Deposit Receipts

Members shall ensure that Fixed Deposit Receipts are renewed prior to the expiry dates.

The members need to submit a letter from the issuing bank evidencing renewal of the FDR.

The format for the said letter is given in Annexure 6. Renewals of the said FDRs shall be the

sole responsibility of the Member.

In case the member wishes not to renew the FDR, member can request for release of FDR.

The format for release of FDR is given as Annexure 4. Members should ensure that base

minimum capital is always maintained at the minimum prescribed level.

Maintaining Minimum Level of Security Deposit

Members are required to maintain the Base Minimum Capital at prescribed levels at all

points of time. If the BMC falls below the minimum required level ACE may initiate

suitable action including withdrawal of trading facilities. Further, shortfall in the value of

BMC shall attract penalty/interest as stipulated by ACE from time to time.

1.2. Additional Base Capital (ABC)

Members can submit Additional Base Capital (ABC) to ACE for increasing their exposure

limit for trading. ABC can be submitted in the following forms:

• Cash

• Cash equivalent in form of Bank Guarantee and Fixed Deposit Receipt)




• Non Cash in form of Equity shares in Demat form,

• Commodities in Demat form / warehouse receipts of commodities traded on the exchange ( a

separate circular will be issued in this regard shortly)

The ratio of Cash to Cash Equivalent for a clearing members will be 1:3. which means

Cash equivalent up to 3 times of the total cash will be considered for valuation. (25% of the

deposits have to be paid in cash and rest 75% in the form of bank guarantee and / or fixed

deposits issued by the approved banks). However any amount of Cash equivalent will be

considered if a clearing member maintains a cash deposits of at least Rs 15 lakhs with the

exchange

The ratio of Cash to Cash Equivalent for a Professional Clearing Members and Institutional

Clearing member will be 1:4. which means Cash equivalent up to 4 times of the total cash

will be considered for valuation. (20% of the deposits have to be paid in cash and rest 80%

in the form of bank guarantee and / or fixed deposits issued by the approved banks).

The ratio of cash and cash equivalent to Non cash will be 1:2. i.e Non cash collateral up to 2 times

the value of cash and cash equivalent will be considered for valuation.

1.2.1. Cash

ABC in the form of cash can be paid either by money transfer through the clearing bank, or any

other mode as may be specified by the Exchange.

Members will be provided a Clearing front-end for carrying out various activities including

ABC increase Through this front end member can put request for increasing the ABC cash.

After the request is submitted by the member, the member‟s clearing bank will confirm the

request which will then be confirmed by the exchange. Once exchange confirms the

transaction, member limit will be increased by the amount of the cash request.

In exceptional circumstances, Members can also send a written instruction to the Exchange by

fax for the purpose of increasing their ABC and its mode of remitting the fund. The format for the

said request is attached as Annexure 7.




Member can request for release of ABC cash in a prescribed format as per Annexure 8.

Members should ensure that ABC cash release request reaches the C&S department before

7.00 PM each business day All such request will be processed subject to availability of free

cash and credited to members settlement account on next settlement day. Any

payin/shortages of the member will be first adjusted against the ABC cash release and

balance will be credited to the members account.

1.2.2. Cash equivalent - Bank Guarantees

Members may submit Bank guarantee towards ABC, in favor of ACE as per the specified

format given in Annexure 1 from approved banks. The other procedures will be the same as

mentioned in BG for Base Capital.

1.2.3. Fixed Deposit Receipts (FDR)

Members may submit Fixed Deposit Receipts (FDRs) towards ABC issued by approved

banks ( Member and Bank letter formats as per Annexure 5) .The FDR should be issued for a

minimum period of 3 months from any of the approved banks .The other procedures will be

the same as mentioned in FDR for Base Capital.

1.2.4. Non cash collateral

1.2.4.1 Equity shares as collaterals

Members can deposit equity shares of approved companies towards Additional Base Capital in

electronic form ('Demat securities') in the designated depository accounts maintained by the

Custodian(s) approved/appointed by the Exchange in this regard.




Overall Limits

Exchange will accept equity shares subject to following overall limits:

Category Haircut

Shares of one

Company (after

haircut)

Total of Shares of All

Companies (after haircut)

Category A 40% 5 crores 25 crores

Category B 50% 2 crores

The list of eligible stocks along with the haircuts is notified by the Exchange through a separate

circular.

In case of any deletion from the list of approved equity shares, the members should replace such

shares within a period of 3 (three) working days or within such time as may be specified by the

Exchange after which the valuation of such shares will be reduced from the Additional Base Capital .

If the same is not replenished by the member, Exchange will release the shares to members account

on the next working day.

Valuation of Equities

Valuation will be done on the daily basis at the rates prevalent at National Stock Exchange of India

Limited (NSE) or Bombay Stock Exchange Limited (BSE),

In case of excess volatility or for any other reason as may be deemed fit by the Exchange the

valuation of equity shares shall be done at such intervals and in such manner as the Exchange

may deem fit.

Approved Custodian

The details of the empanelled Custodian are as under.




HDFC Bank Limited

Contact Persons:

Mr.Shivayogi Kubasad

Process House , Second floor ,

Kamala Mills Compound , S.B Marg ,

Lower Parel (W) , Mumbai - 400013

Phone – 022-24988484- Ext-3570

Mobile - 9323469244

email id [email protected]

Mr. Samit Mehta,

Trade World, A Wing, Second floor

Kamala Mills Compound, S.B Marg,

Lower Parel (W), Mumbai - 400013

Phone - 24988484 - Ext - 3567

Mobile - 9323851617

email id - [email protected]

Members may contact the Custodian to ascertain the modalities with regard to deposit of securities.

The approved custodian(s) will specify the charges to be levied for the above services and the

manner in which the payments are to be made to them. The Members shall pay the bills raised by

the approved Custodian(s) within such time specified by the custodian directly to the custodian.

Ownership of Equity shares

The securities that may be deposited shall be subject to the beneficial ownership of the Member. In

case of Partnership Firms and Limited Liability Partnerships (LLPs), the securities belonging to any

of the partners, in case of corporate, the securities belonging to any of the directors and in case of

Hindu Undivided Family (HUF), the securities belonging to Karta shall also be accepted provided

they hold the securities as sole/first joint holder and no depositor of securities is minor as on the date

of deposit thereof.




In case of reconstitution/restructuring or any such change in the partners/directors/Karta of the

Member, as applicable, a Member shall be required to replace the securities belonging to such

outgoing partners/ directors/karta held in their name solely or jointly, as the case may be,

immediately and no benefit shall be given by the Exchange for such securities towards Additional

Margin Deposits.

Equity shares not acceptable

The following shares shall not be accepted for the purpose of security deposit:

Shares not as per the approved list;

Partly paid up shares;

Shares subject to any lock in period, buy back scheme, any charge or lien, encumbrance of any

kind or whose title is questioned before a Court or any regulatory body or such other limitations.

Marking of Pledge

Members along with joint holders, if any, may deposit dematerialized securities with the

custodian by marking a pledge of the securities in favour of the Exchange. In addition to

any document as may be required by the approved custodian in this regard, the following

documents are required to be provided to the approved custodian.

Deed of pledge is to be executed in the format prescribed by the Exchange and available

with the approved custodian on a non-judicial stamp paper os Rs.300/-or of such

prescribed amount as may be applicable to an agreement executed in the Place of

Execution or as applicable in the State where document is executed , whichever is higher.

Certified true copy of the relevant Board Resolution in case of a corporate body.

Members and the joint holders, if any shall give the necessary pledge instructions to the

approved custodian for the securities to be pledged in favour of the Exchange.




These securities shall be pledged in favour of “Ace Derivatives & Commodity Exchange

Limited”. The pledge deed for Securities should be submitted to the Custodian as per

Annexure 9

Once the securities are accepted and duly pledged by the approved Custodian , the

approved Custodian shall inform the Exchange the value of the securities after adjusting

the haircut percentages as stipulated by the Exchange and the same shall be considered

as Additional Base Capital.

Release of Equity shares

Members can request for release of Equity shares pledged as collateral by submitting letter as

per Annexure 10. All such release request should reach ACE by 7.00 PM.

Exchange will consider the request for release taking into account the margin deposits and

obligations, outstanding obligations / positions / dues towards the Exchange if any, and that there

is no other liability under the Rules, Bye-Laws and Business Rules of the Exchange, and

Exchange may in accordance with the provisions detailed above, inform the approved

custodian(s) to release such specific securities. The said custodian(s) shall then release the

pledge marked in favor of the Exchange and release such securities to the said Member. the next

day

1.2.4.2 Commodity as collaterals

Commodities as collateral will be accepted as notified by the Exchange from time to time.




2. Clearing Front End

ACE will be providing a clearing front end to its members. Members will have to submit a

written request to membership department to obtain User ID and password for accessing

the front end. The format of request is available on the website of the exchange i.e

www.aceindia.com under the “other membership documents” tab. (Clearing User ID

document).

Through this clearing front end members can carry out activities like submiting requests for

Increase in ABC, confirm MTM payin, assigning collaterals to Trading Members (by

Clearing Member), submit delivery intentions, submit Early Payin request, create and

upload client details, view obligation report.

Members are requested to refer the “Clearing user manual” available on the website

www.aceindia.com for further details on the same

http://www.aceindia.com/

http://www.aceindia.com/




Annexure – 1

Format of the Bank Guarantee for Collaterals as Base Minimum/Additional Base Capital

Instructions:

1. This Bank Guarantee has to be either franked or executed on a Non-Judicial stamp paper of Rs.

300/- or the value prevailing in the state, whichever is higher.

2. Please ensure that each and every blank cell in the Bank Guarantee is duly filled.

3. Please ensure that each and every handwritten detail filled is countersigned by the authorized

signatory (ies).

4. Please ensure that each and every page is signed and rubber stamped.

5. Please ensure that BG number, Issue date, BG amount and maturity date are mentioned on

each and every page of the BG




BG No

Issue Date

Maturity Date

BG Amount

GUARANTEE

This guarantee is issued by ________________________________________ (Bank Name), a body

corporate constituted under the ____________________________ Act 19__, having its Head Office at

___________________________________ (hereinafter referred to as the “Bank” which term shall

wherever the context so permits, includes its successors and assigns) in favour of ACE DERIVATIVES

& COMMODITY EXCHANGE LIMITED, a company established under the Companies Act, 1956 and

having its registered office at Rawat ni Wadi, Nr. Central Bank of India, Gandhi Road, Ahmedabad,

Gujarat, 380001 (hereinafter referred to as “ACE” which expression shall unless it be repugnant to the

context or meaning thereof be deemed to mean and include its successors and assigns)

WHEREAS

1. Mr./Ms. _______________________________________________________ s/o / d/o / w/o

____________________________________,residing at _________________________

_____________________________ and having his/her office at

___________________________________________________________________________

(Complete Address), (hereinafter referred to as the “Member”, which expression shall unless it

be repugnant to the context or meaning thereof be deemed to mean and include his/her

successors and assigns) /*

OR

M/s ______________________________________________, a partnership firm registered

under the Indian Partnership Act, 1932 and having their office at

_____________________________________________________________________________

__ (Complete Address), (hereinafter referred to as the “Member”, which expression shall unless

it be repugnant to the context or meaning thereof be deemed to mean and include their

successors and assigns) /*

OR

M/s __________________________________________________________ Limited,

incorporated under the Companies Act, 1956 and having its registered office at




BG No

Issue Date

Maturity Date

BG Amount

___________________________________________________________________________

(Complete Address), (hereinafter referred to as the “Member”, which expression shall unless it

be repugnant to the context or meaning thereof be deemed to mean and include its successors

and assigns) * is/are a Member of ACE.

2. One of the conditions of Membership of ACE is that the Member maintains with ACE Security

Deposit / Margin Deposit in the form of Cash, Bank Guarantees, FDRs and Government of

India Securities of such value as prescribed by ACE, after applying suitable margins as

prescribed by ACE.

3. At the request of the Member, ACE has agreed to accept a bank guarantee in lieu of Security

Deposit / Margin Deposit from an approved commercial bank for an equivalent amount of

Rs.______________ (Rupees __________________________________ only).

4. The Member has requested the Bank to furnish to ACE a guarantee for Rs.________________

(Rupees ______________________________only).

NOW IN CONSIDERATION OF THE FOREGOING,

1 We, the ______________________________________________________ (Name of Bank)

having a branch at _______________________________

___________________________________________________________________________

(Complete Address of Branch) at the request and desire of the Member do hereby irrevocably

and unconditionally guarantee to pay a sum of Rs.___________, (Rupees __________

_________________________ only) to ACE as a security for due performance and fulfillment by

the Member of his/her/its engagements, commitments, operations, obligations or liabilities as a

Member of ACE including any sums due by the Member to ACE or any other party as decided by

BG No




Issue Date

Maturity Date

BG Amount

2 ACE arising out of or incidental to any contracts made, executed, undertaken, carried on or

entered into or purported so to be, by the Member. The Bank agrees and confirms that the said

guarantee shall be available as a security for meeting, satisfying, discharging or fulfilling all or

any obligation or liability of the Member as directed and decided by ACE, with no reference to

the Member.

3 The Bank hereby agrees that if in the opinion of ACE, the Member has been or may become

unable to meet, satisfy, discharge or fulfill any obligations, liability or commitments or any part

thereof to ACE, or its Clearing and Settlement mechanism /arrangement or to any other party as

decided by ACE, then without prejudice to the rights of ACE under its Bye-laws, Rules, or

Business Rules or otherwise, ACE may at any time thereafter and without giving any notice to

the Member invoke this guarantee to meet the aforesaid obligations, liabilities or commitments of

the Member.

4 The Bank undertakes that it shall, on first demand of ACE, without any demur, protest or

contestation and without any reference to the Member and notwithstanding any contestation by

the Member, pay to ACE such sums not exceeding Rs_____________ (Rupees

______________________________ only) as may be demanded by ACE. The decision of ACE

as to the obligations or liabilities or commitments of the Member and the amount claimed shall

be final and binding on the Bank, and any demand made on the Bank shall be conclusive as

regards the amount due and payable by the Bank under this guarantee.

5 The guarantee shall be a continuing guarantee and remain operative in respect of each of the

obligations, liabilities or commitments of the Member severally and may be enforced as such in

the discretion of ACE, as if each of the obligations, liabilities or commitments had been

separately guaranteed by the Bank. The guarantee shall not be considered as cancelled or in

any way affected on any demand being raised by ACE but shall continue and remain in




BG No

Issue Date

Maturity Date

BG Amount

operation in respect of all subsequent obligations, liabilities or commitments of the Member.

However the maximum aggregate liability of the Bank during the validity of the guarantee shall

be restricted to an aggregate sum of Rs.______________ (Rupees ______________

____________________ only).

a. Notwithstanding the above, the Bank notes that the nature of operations of the Member

is such that the obligations, liabilities or commitments of the Member are of a continuing

nature and as such, Bank agrees that this guarantee can be invoked by ACE even in

respect of the obligations, liabilities or commitments of the Member towards ACE which

might have arisen prior to the execution of this guarantee.

5. This guarantee shall not be prejudiced by the failure of the Member to comply with the Byelaws,

Rules or Business Rules of ACE or any terms and conditions attendant to the Membership of

ACE. ACE shall be at liberty to vary, amend, change or alter any terms or conditions or its Bye

Laws, Rules or Business Rules of Membership to ACE in general or as applicable to the Member

in particular from time to time, without thereby affecting its rights against the Member or the Bank

or any other security belonging to Member now or hereafter held or taken by ACE at any time.

The discretion to make demands under this guarantee shall exclusively be that of ACE and ACE

is entitled to demand hereunder notwithstanding being in possession of any deposits or other

securities of the Member.

6. The validity of this guarantee shall not be affected in any manner whatsoever if ACE takes any

action against the Member including DECLARATION OF A DEFAULTER, SUSPENSION or

EXPULSION or any other disciplinary action.

7. The Bank further agrees that ACE shall have the fullest liberty without our consent and without

affecting in any manner our obligations hereunder to vary any of the terms and conditions of

membership of the Member, Bye Laws, Rules and/or Business Rules or to extend time of

performance of any obligation/s by the said Member from time to time or to postpone for any

time or from time to time any of the powers exercisable by ACE against the said Member and to

forbear or enforce any of the terms and conditions relating to the membership and we shall not




be relieved from our liability by reason of any such variation, or extension being granted to the

said Member or for any forbearance, act or omission on the part of ACE or any indulgence by

ACE to the said Member or by any such matter or thing whatsoever which under the law relating

to sureties would, but for this provision, have effect of so relieving us.

8. This guarantee shall not be affected by any change in the constitution of ACE or the Member or

the Bank and it shall remain in force notwithstanding any forbearance or indulgence that may be

shown by ACE to Member.

9. The Bank undertakes to pay to ACE, the amount hereby guaranteed within 24 hours of being

served with a written notice requiring the payment of the amount either by hand delivery or by

Registered Post or by Speed Post.

10. This guarantee may be invoked by ACE in part(s) without affecting its rights to invoke this

guarantee for any liabilities that may devolve later.

11. The Bank undertakes not to revoke this guarantee during its currency except with the previous

consent of ACE in writing and this guarantee shall be a continuous and irrevocable guarantee

upto a sum of Rs. _____________________________ (Rupees

______________________________________________ only).

12. Notwithstanding anything mentioned herein above, the liability of the Bank under this guarantee

shall not exceed Rs. ______________ (Rupees _________________________ only) and it shall

be valid for a period of _______ months i.e. up to ____________________ (Date of expiry of

Bank Guarantee).

13. The bank is liable to pay the guaranteed amount only if ACE serves upon the Bank a written

claim or demand on or before __________________ (Claim date of the bank guarantee) i.e.

within _____ months after the date of expiry of Bank Guarantee.

14. This Bank Guarantee shall be governed by and construed and interpreted in accordance with the

laws of India and the courts in Mumbai shall have exclusive jurisdiction on all matters arising out

of this Bank Guarantee.

15. The Bank has power to issue this Guarantee under the statute and the undersigned has full

power to sign this Guarantee on behalf of the Bank.

Executed on this _______________day of ______________________ at __________ (place).

FOR ____________________________________ (BANK)

_______________________________________ BRANCH)




AUTHORIZED SIGNATORIES

SEAL OF THE BANK

* Delete whichever is not applicable




Annexure -2

Approved Banks for issuance of BG and FDR

Sr

No Name of Bank

Sr

No Name of Bank

1 State Bank of India (SBI) 29 Dena Bank

2 ICICI Bank Ltd. 30 State Bank of Bikaner & Jaipur

3 Punjab National Bank 31 Punjab & Sind Bank

4 Bank of Baroda 32 State Bank of Mysore

5 Bank of India 33 The Federal Bank Ltd.

6 Canara Bank 34 The Jammu & Kashmir Bank Ltd.

7 HDFC Bank Ltd. 35 State Bank of Indore

8 IDBI Bank Ltd. 36 ABN Amro Bank N.V.

9 Union Bank of India 37 ING Vysya Bank Ltd.

10 Axis Bank Ltd. 38 Kotak Mahindra Bank Ltd.

11 Central Bank of India 39 Indusind Bank Ltd.

12 Syndicate Bank 40 Deutsche Bank AG

13 Indian Overseas Bank 41 YES Bank

14 Oriental Bank of Commerce 42 The Karnataka Bank Ltd.

15 UCO Bank 43 Barclays Bank PLC

16 Citibank N.A. 44 The South Indian Bank Ltd.

17 Allahabad Bank 45 The Bank of Rajasthan Ltd.

18 Standard Chartered Bank 46 The Karur Vysya Bank Ltd.

19

The Hongkong and Shanghai

Banking Corporation Ltd. 47

The Development Bank of Singapore

Ltd.

20 Corporation Bank 48 JPMorgan Chase Bank

21 Indian Bank 49 Bank of America NA

22 State Bank of Hyderabad 50 BNP Paribas

23 State Bank of Patiala 51 The Bank of Nova Scotia

24 Andhra Bank 52 Calyon Bank

25 Vijaya Bank 53 Development Credit Bank Ltd.




Sr

No Name of Bank

Sr

No Name of Bank

26 United Bank of India 54 The Dhanalakshmi Bank Ltd.

27 Bank of Maharashtra 55 Societe Generale

28 State Bank of Travancore




Annexure 3

Format of letter for Renewal of BGs

Instructions

1. This Bank Guarantee has to be either franked or executed on a Non-Judicial stamp paper of Rs. 300/-

or the value prevailing in the state, whichever is higher.

2. Please ensure that each and every blank in the Bank Guarantee is duly filled.


signatory (ies).





To,

Ace Derivatives & Commodity Exchange Limited

4th Floor,

Building Number 4,

Infinity IT Park,

General A.K.Vaidya Marg,

Malad (East),

Mumbai 400 097

We, _______________________________________ (Bank Name) having our registered office at

________________________________________________ and our branch office at

_______________________________________________ refer to the Bank Guarantee number:

____________________ executed by us on the __________ day of ____________ 20__ at

_____________ (hereinafter referred to as “said guarantee”) on account of Mr./Ms./M/s.

____________________________________________________ having his/her/ its/registered office

at________________________________________________________

__________________________________________________________________________(hereinaft

er referred to as a „Member‟) for a sum of Rs ______________ (Rupees

__________________________________________________only) in your favour.

The validity of the said guarantee was up to ____________________________.

With reference to the same we state as hereunder:

At the request of the Member, we extend the period of the validity of the said guarantee up to

__________________.

Notwithstanding anything mentioned herein above,

a) The liability of the Bank under this guarantee shall not exceed Rs. _______________ (Rupees

________________________________________ only)




b) This guarantee shall be valid for a period of ____________months i.e. up to

_______________.

c) The bank is liable to pay the guaranteed amount only if ACE serves upon the Bank a written

claim or demand on or before ________________ (i.e. within ___ months after the date of

expiry of the bank guarantee as mentioned in clause b above).

We hereby affirm and confirm that save and except to the extent as provided for herein above, the

said guarantee together with all other terms and conditions therein shall remain operational and in

full force and effect till _________________________.

Signed for and on behalf of _________________________________ on this ____________ day of

_____________________ at ___________________.

FOR ________________________________ (BANK)

________________________________ (BRANCH)

AUTHORIZED SIGNATORIES

SEAL OF THE BANK




Annexure – 4

Format of Letter for release of BG/ FDR

(On the letter head of the member)

To

Ace Derivatives & Commodity Exchange Limited

4th Floor,

Building Number 4,

Infinity IT Park,


Malad (East),

Mumbai 400 097

Dear Sir/Madam,

Sub: Release of BG / FDR given towards ABC/BMC

You are requested to release the following BG/ FDR submitted earlier towards Base Minimum

Capital/ Additional Base Capital*:

Sr.

No.

BG / FDR No. Issue

Date

Maturity

Date

Amt. in

Rs.

Yours faithfully,

Authorized Signatory

Name:

Designation:

* Strike out whichever is not applicable




Annexure - 5

Format of Letter for Submission of FDR/BG

[On the letter head of the member]

Date To Ace Derivatives & Commodity Exchange Limited 4

th Floor,

Building Number 4, Infinity IT Park, General A.K.Vaidya Marg, Malad (East), Mumbai 400 097

Dear Sir/Madam,

Ref: Member Name - __________________________________

Member Code - ___________

As required by you and in compliance of your norms, we have to furnish you Additional Base

Capital / Base Minimum Deposit*. Accordingly we have furnished the same in the form of FDR

placed with ________________ Bank, issued as ACE DERIVATIVES & COMMODITY

EXCHANGE LIMITED - A/c Member Name for Rs. ____________.

The details of FDR are as under:

FDR

No.

Issue

Date

Amount in

Rs.

Maturity

Date

I / We hereby agree and give consent that you i.e., ACE Derivatives & Commodity Exchange

Limited (ACE), shall have an irrevocable authority to encash the said FDR and to withdraw the

said FDR amount at any time, even prior to maturity without notice to me / us for adjustment of

ACE dues and we have no objection whatsoever to the same.

Yours faithfully,


Name:

Designation:

Contact no:

Strike out whichever is not applicable




Annexure 5-

Format of Letter Confirming the Lien on Fixed Deposit Receipt

[On the letter head of the bank]

Date

To

ACE Derivatives & Commodity Exchange Limited

4th Floor,

Building Number 4,

Infinity IT Park,


Malad (East),

Mumbai 400 097

Dear Sir/Madam,

We refer to the fixed deposit receipt (FDR) bearing no. ______________ issued for

Rs.___________, in the name of ACE DERIVATIVES & COMMODITY EXCHANGE LIMITED - A/c

Member Name.

We hereby confirm that

i) There is no lock in period for encashment of the said FDR.

ii) The amount under the said FDR would be paid to you on demand, on or before the maturity of

the said FDR.

iii) Encashment whether premature or otherwise would not require any clearance from any other

authority / person.

iv) We agree that on encashment of FDR, the interest accrued will also be released to you.

v) We agree that the FDR will be renewed for such periods as may be instructed by the Member /

Custodian / ACE Derivatives And Commodity Exchange Limited

Yours faithfully,


Name:

Stamp of the Bank




Annexure – 6

Format of the Letter to be given by Bank for FDR renewal

[On the letter head of the bank]

Date :

To


4th Floor,

Building Number 4,

Infinity IT Park,


Malad (East),

Mumbai 400 097

Dear Sir/Madam,

We refer to the fixed deposit receipt (FDR) issued, in the name of ACE Derivatives & Commodity

Exchange Limited - A/c Member name. Details are as under.

Old FDR No Issue Date Amount in Rs. Old Maturity Date

The above FDR(s) has/have been renewed for further period of _____months under the auto renewal

facility on the request of the Member. Details are as follows.

New FDR No Renewal Date Amount In Rs. New Maturity Date

We hereby confirm that




i) There is no lock- in period for encashment of the said FDR.

ii) The amount under the said FDR would be paid to you on demand, at any point of time without

any reference to the ________________ (name of Member).

iii) Encashment whether premature or otherwise would not require any clearance from any other

authority / person.

iv) We agree that on encashment of FDR, the interest accrued will also be released to you.

v) We agree that the FDR will be renewed for such periods as may be instructed by the Member

/ Custodian / ACE.

vi) Old Instrument shall become invalid and new instrument with new FDR No._____ is issued

(Only in case when new FDR is issued against the expiring FDR).

Yours faithfully,


__________ Bank Ltd

Stamp of the Bank




Annexure -7

Draft of the Letter to be given by the Member for submitting Additional Base Capital by way of cash

deposit

Date :

To


4th Floor,

Building Number 4,

Infinity IT Park,


Malad (East),

Mumbai 400 097

Dear Sir or Madam:

Sub: ABC Cash Debit

Clearing Member Code : __________

Bank Account No. : __________

Bank Name : __________

You are requested to debit my a/c for “Rs._________ Lacs (in words)” as mentioned above towards

additional base capital.

This is in addition to “Rs. ____________________ Lacs (in words)” already given today.




Total amount including this letter = “Rs.________________________ Lacs (in words)”.

I/We understand that the said amount would be withheld with ACE till further instruction given by us.

Yours faithfully,


Name:

Designation:




Annexure – 8

Format of letter to be given by members for release of Cash

[On the Letter head of the Member]

Date :

To


4th Floor,

Building Number 4,

Infinity IT Park,


Malad (East),

Mumbai 400 097

Dear Sir/Madam,

Sub: ABC/ BMC - Cash Release

Member Code : __________

Bank Account No. : __________

Bank Name : __________

You are requested to release an amount of “Rs.________________ (in words)” to my / our a/c

from Additional base capital/Base minimum Capital*.

This is in addition to “Rs. ____________________ (in words)” already given today.

Total amount including this letter is “Rs.________________________ (in words)”

We have considered the ratio of cash and non cash collaterals as specified by the Exchange and

understand that our margin limits shall be reduced accordingly.

Kindly note that the same is not being used towards margins.

Yours faithfully,


Name:

Designation:

Strike out whichever is not applicable




Annexure 9

Deed Of Pledge to be executed by Members for pledge of Equity shares

1. This Pledge deed has to be either franked or executed on a Non-Judicial stamp paper of Rs.

300/- or the value prevailing in the state, whichever is higher.

2. Please ensure that each and every blank of the pledge deed is duly filled.


signatory (ies).


5. Obtain signature of two witnesses on the last page of undertaking.

6. In case of a corporate entity affix the common seal of the company on the last page.




DEED OF PLEDGE

This Deed of Pledge (hereinafter referred to as “this Deed”) is executed at _______________ on this

___ day of _________ 20___ by _____________________, S/o /d/o / w/o __________________

residing at _____________________ and having his office at ________________________________

*

OR

_____________________________, a partnership firm registered under the Indian Partnership Act,

1932 and having its office at __________________________________*

OR

________________________Limited incorporated as a company under the Companies Act, 1956 and

having its registered office at ___________________________________*

(hereinafter referred to as “Member” which expression shall unless repugnant to the context thereof

include its successors, administrators and assigns) in favour of ACE Derivatives & Commodity

Exchange Limited ,a company established under the Companies Act, 1956 and having its registered

office at Rawat ni Wadi, Nr. Central Bank of India, Gandhi Road, Ahmedabad, Gujarat, 380001

(hereinafter referred to as “ ACE ” which expression shall unless it be repugnant to the context or

meaning thereof, be deemed to mean and include its successors and assigns).

WHEREAS:

a The Member is admitted to the Membership of ACE

b One of the requirement of Membership is that the Member if desirous of availing exposure,

shall maintain with ACE base capital/margin deposits/margin deposits (hereinafter for brevity

case referred to as “margin deposits”) in the form of cash, bank guarantees or securities for the

due performance and fulfillment by him/her/it of his/her/its engagements, commitments,




operations, obligations or liabilities as such Member including any sums due by such member

to ACE or any other party as decided by ACE arising out of or incidental to any contracts made,

executed, undertaken, carried out or entered into by such member.

c Securities to be deposited by the Member for the purpose shall be in dematerialized form and

as approved by ACE from time to time.

d The Members shall deposit the securities with such custodians acting as depository participants

as may be determined by ACE from time to time.




NOW THIS DEED WITNESSETH AS FOLLOWS:

1. In consideration of ACE having agreed to accept approved dematerialized securities as

approved by it towards margin deposits to an extent of Rs._________ /- (Rupees

___________________only), the Member hereby pledges securities (hereinafter referred to as

“Said Securities” and which are described in the Schedule annexed hereto and shall include all

the securities deposited from time to time in addition to, substitution of or replacement thereof)

with ACE as security for due performance and fulfillment by the Member of all his/her/its

engagements, commitments, operations, obligations or liabilities as a Member of ACE including

any sums due by the Member to ACE or any other party as decided by ACE, arising out of or

incidental to any contracts made, executed, undertaken, carried out or entered into by the

member.

2. The Member shall place the Said Securities in the absolute disposition of such

Custodian/Depository Participant as may be appointed by ACE for the purpose, in such manner

as decided by ACE and such disposition shall be indisputable notwithstanding the fact that the

Member may be permitted to have access to the Said Securities in the manner and subject to

such terms and conditions as determined by ACE from time to time. The Member confirms,

affirms and covenants with ACE that he/she/it shall do all such acts and things, sign such

documents and pay and incur such costs, debts and expenses as may be necessary without

prejudice to any other obligations, liabilities, duties which he/she/it owes as a Member.

3. The Member declares and assures that all the Said Securities are in existence, owned by him/

her/it and free from any prior charge, lien or encumbrance and further shall ensure that all the

Said Securities over which pledge may be created in future shall be in existence and owned by

him/ her/it at the time of creation of such pledge and shall be unencumbered, absolute and

exclusive property of the Member.

4. The Member agrees and undertakes that he/she/it shall not without the prior written permission

of ACE create any charge, lien or encumbrance of any kind upon or over the Said Securities

hereby pledged or those which may hereafter be pledged except to ACE, that the Member shall




not suffer any such charge, lien or encumbrance that may affect the Said Securities or any part

thereof, and further undertakes that he/she/it shall not do or allow anything to be done that may

prejudice the Said Securities while he/she/it remains liable to ACE in any manner.

5. The Member agrees, declares and undertakes that he/she/it shall be bound and shall abide by

the terms and conditions of the Scheme for the Deposit of securities in dematerialized form as

formulated and determined by ACE pertaining to margin deposits, or such other requirements

either in their existing form or as modified/changed/altered/amended from time to time pursuant

to requirement/compliance of Membership.

6. The Member agrees and hereby authorizes that if in the opinion of ACE, the Member has failed

to perform and/or fails to fulfill his/her/its engagements, commitments, operations, obligations or

liabilities as a Member of ACE including payment of any sums due by him/ her/it to ACE or to

any other party arising out of or incidental to any contracts made, executed, undertaken, carried

out or entered into by him/ her/it, then the Member agrees that ACE may invoke the pledge and

thereafter on giving one working day notice to the Member shall be empowered/entitled to, sell,

dispose of or otherwise effect any other transfer of the Said Securities in such manner and

subject to such terms and conditions as it may deem fit and that the money if any realized from

such sale/disposal/or other transfer shall be utilized towards dues/may be disbursed by ACE in

such manner and subject to terms and conditions as it may deem fit and further the Member

shall do all such things, deeds, acts and execute all such documents as are necessary to

enable ACE to effect such sale/disposal/or other transfer. The decision of ACE as to the

obligations or liabilities or commitments of the Member and the amount claimed shall be final

and binding on the Member. The Member agrees that one working day notice mentioned above

shall be deemed to be a reasonable notice, as this pledge of securities is being accepted as

margin deposits by ACE in lieu of cash deposits or bank guarantees, which can be invoked

forthwith upon any amount becoming due and appropriated under the Bye-laws, Rules, and

Business Rules of ACE.

7. The Said Securities pledged as security shall be available at the disposal of ACE as a

continuing security and shall remain available for and in respect of all the obligations, liabilities




or commitments of the Member jointly or severally and may be utilized as such at the discretion

of ACE, as if each of the obligations, liabilities or commitments is secured by the Said

Securities. This Deed shall not be considered as cancelled or in any way affected upon the

utilization or realization by ACE of the Said Securities for meeting any specific obligation,

liability or commitment of the Member and shall continue and remain in operation in respect of

all subsequent obligations, liabilities or commitments of the Member.

8. The Member agrees to be bound by the instructions of ACE to its custodian or the Depository

Participant as the case may be, in respect of creation of pledge, invocation of pledge, release

thereof, transfer of securities or sale of securities arising out of any obligations of the Member

as referred hereinabove and the Member further agrees that ACE shall not be bound to notify

the Member incase of invocation of pledge created by the Member by these presents.

9. The Member shall be released from his/her/its obligations, liabilities under this Deed only when

ACE, in writing, expressly provides for the release of the Said Securities.

10. The Member agrees that ACE shall be entitled to sell, negotiate or otherwise transfer the Said

Securities and for the purpose to execute transfer documents and/or any other necessary

documents, wherever applicable or other endorsements and that ACE shall be entitled to

receive from the Member all expenses incurred by ACE/Custodian for the aforesaid purposes.

11. The Member agrees to pay promptly all such fees, charges and/or costs pertaining to pledge of

the Said Securities to the Custodian and/or the Depository Participant and to execute such

further documents whether of a legal nature or otherwise as may be required by ACE for the

purpose of giving effect to the provisions of this Deed and also the Scheme for the Deposit of

Securities in dematerialized form.

12. The Member agrees that the deposit of the Said Securities and the pledge thereof shall not be

affected in any manner whatsoever if ACE takes any action against the Member including

suspension or expulsion or declaration of the Member as a defaulter.




13. The Member agrees that ACE shall not be under any liability whatsoever to the Member or any

other person for any loss, damage, expenses, costs, etc., arising out of the deposit of the Said

Securities under these presents, in any manner, due to any cause, whatsoever, irrespective of

whether the Said Securities are in the possession of ACE at the time of such loss or damage or

the happening of the cause thereof. The Member shall at all times indemnify and keep

indemnified ACE from and against all suits, proceedings, costs, charges, claims and demands

whatsoever that may at any time arise or be brought or made by any person against ACE in

respect of any acts, matters and things lawfully done or caused to be done by ACE in

connection with the Said Securities or in pursuance of the rights and powers of ACE under this

Deed.

14. The Member undertakes that the deposit of the Said Securities and the pledge thereof and any

pledge of securities that may be created shall be binding on the Member as continuing and that

the same shall not be prejudiced by any failure on the part of the Member to comply with the

Bye-laws, Rules or Business Rules of ACE or any other terms and conditions attendant to the

Membership of ACE and that ACE shall be at liberty to enforce its rights hereunder,

notwithstanding its rights against the Member hereunder or under its Byelaws, Rules and

Business Rules including amendments thereof or in relation to the Said Securities or to any

other security now or hereafter held or taken at any time irrespective of any variation,

amendment, change or alteration of any terms or conditions in general or as applicable to the

Member in particular.

15. The executant/s hereby declares that he/she/it has been duly authorized to execute this Deed

by way of Board Resolution of the Member (only in case of corporate members) as per the

copy of Board Resolution annexed hereto.

16. This Deed shall be governed by and construed and interpreted in accordance with the laws of

India and the courts in Mumbai shall have exclusive jurisdiction on all matters arising out of this

Deed.

Executed at _____________ on the day, month and year above mentioned.




Signed, sealed and delivered by the within named Member **

________________________

In the presence of witnesses

1.

2.

* Strike out whichever is not applicable

** To be signed by

a. The individual if the membership is in his/her name.

b. all partners in case of a Partnership firm

c. by any two of the following persons in the case of a Company:

i. Managing Director

ii. Whole-time Director

iii. Directors (authorized by Board Resolution for the purpose)

SCHEDULE

Company

/

Issuer of

Security

Type of

Security

Face

Value

Total no.

of

securities

Remark




Annexure – 10

Format of letter for release of Equity Shares

[On the letter head of the Member ]

Date :

To


4th Floor,

Building Number 4,

Infinity IT Park,


Malad (East),

Mumbai 400 097

Dear Sir/Madam,

Sub: Release of equity shares/WR kept as Additional Base Capital

Clearing Member Code: __________

We wish to withdraw the following equity shares/WR kept as Additional Base Capital

For Equity shares

Sr

no

Symbol ISIN

No.

Security

Name

Qty Custodian

We request you to consider our request for release of the above mentioned securities/warehouse

receipt as per the applicable norms.

Yours faithfully,


Name:

Designation:

ace derivatives & commodity exchange limited

Documents