SECURITIZATION - GUERNSEY

For information & strictly for internal use only!

Dear Fréderic,

Thank you very much for getting back to me.

Please find enclosed our factsheet on the solution and a product questionnaire.

As mentioned, I would rather advise you a product with lower start-up costs instead of creating your own issuer. An issuer plus initial product in the first year will cost you well over CHF 50k. The problem is that if you don't reach the expected size, which I have seen over and over again, you are tied to high fixed costs without escape. If you are convinced that you can raise far more than EUR 20 mio and such costs do not scare you, I would rather set up a fund in your position, which is the Rolls Royce format and allows you to grow further (approx. 6 months to set up). We have a fund solution provider for crypto/tokens in Malta. Unlike the Guernsey tracker, you…

Dear Jean-Marc,

Many thanks for the meeting.

The solution discussed concerns a European AIF underlying that invests into non-US underlyings.

Very important: Investing in U.S. underlying assets would be a game changer and could significantly increase costs.

Please find enclosed our Tracker Factsheet. Such Guernsey solution on a liquid underlying is classified as a structured product / alternative asset and is a contractual product within an existing issuer.

Such a tracker is in fact an AMC with only one asset. The product sponsor (your client) acts as the strategy manager.

Client:

"What we really meant is to arrange a call between us and our legal counsel in the UAE, as to make sure to build the best structure for the strategy manager and an SPV for the retail investors."

Answer:

"As far as the distribution of the AMC is concerned, we cannot offer you any advice in this regard. I recently had a brief call from Alex on this topic and I thought that I was very clear. The AMC format is a private placement and per se approved for professional investors only. Under MIFID law, investors' principal banks would have to refuse to purchase for them if they are classified as retail investors. The banks sometimes only warn their clients and make them sign a waiver so that they have fulfilled their obligations and cannot be held liable for losses. However, it is 100% your responsibility to not distribute such…