UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 29, 2015
MORGAN STANLEY SMITH BARNEY SPECTRUM SELECT L.P.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware | 000-19511 | 13-3619290 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
c/o Ceres Managed Futures LLC
522 Fifth Avenue
New York, New York 10036
(Address and Zip Code of principal executive offices)
Registrants telephone number, including area code: (855) 672-4468
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.01 | Entry into a Material Definitive Agreement. |
On October 29, 2015, Ceres Managed Futures LLC, the general partner of Morgan Stanley Smith Barney Spectrum Select L.P. (the Registrant), acting on behalf of the Registrant, and Morgan Stanley & Co. LLC (MS&Co.), executed a U.S. Treasury Securities Purchase Authorization Agreement (the Authorization Agreement), between MS&Co. and the Registrant, pursuant to which, effective as of June 1, 2015, MS&Co. is authorized and instructed to, among other things, purchase U.S. Treasury securities with available cash from the Registrants account. The Authorization Agreement is in addition to and supplements the Registrants commodity futures customer agreement with MS&Co. (the Existing Customer Agreement).
The Authorization Agreement may be terminated by MS&Co. at any time; however, notwithstanding any such termination, MS&Co. will provide the services until the maturity date of the U.S. Treasuries held in the Registrants account at the time of the notice to terminate.
There have been no changes to the fees paid to MS&Co. pursuant to the Existing Customer Agreement and, in all other respects, the Existing Customer Agreement remains unchanged and of full force and effect in regards to the Registrant.
The Authorization Agreement is filed herewith as Exhibit 10.1.
Item 9.01 | Financial Statements and Exhibits. |
(d) | Exhibits. |
The following exhibit is filed herewith.
Exhibit No. |
Description | |
10.1 | U.S. Treasury Securities Purchase Authorization Agreement, effective as of June 1, 2015, by and among Morgan Stanley & Co. LLC and the Registrant. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
MORGAN STANLEY SMITH BARNEY SPECTRUM SELECT L.P. | ||
By: | Ceres Managed Futures LLC, | |
General Partner | ||
By: | /s/ Patrick T. Egan | |
Patrick T. Egan | ||
President and Director |
Date: November 4, 2015
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Exhibit 10.1
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MORGAN STANLEY & CO. LLC
LISTED DERIVATIVES
U.S. TREASURY SECURITIES PURCHASE AUTHORIZATION AGREEMENT
This Agreement governs the service (Service) made available to each Fund set forth in Annex A hereto (each such Fund, the Customer) by Morgan Stanley & Co. LLC (MS&Co.) and is effective as of June 1, 2015. This Agreement is in addition to and supplements Customers Commodity Futures Customer Agreement (the Futures Agreement). Unless otherwise specified in this Agreement, all capitalized terms used herein shall have the meanings set forth in the Futures Agreement and references herein and in the Futures Agreement to the Agreement shall be construed to mean the Futures Agreement as amended and supplemented by this Agreement. Except as otherwise modified by this Agreement, the terms and conditions of the Futures Agreement remain in full force and effect.
1. The Service. The Service consists of: (i) the purchase of U.S. Treasury securities with Available Cash from Customers Account; and (ii) actions taken from time to time with respect to such U.S. Treasury securities by MS&Co., each as instructed and authorized by Customer in accordance with the terms of this Agreement, as further set forth below. The term Available Cash means the amount of any excess equity in the form of cash in the Account, which would, consistent with Applicable Law, be available on demand for withdrawal or transfer in accordance with Customers instructions.
2. Authorizations. MS&Co. is hereby authorized and instructed to: (a) purchase with Available Cash U.S. Treasury securities in accordance with a written purchase order substantially in the form of Annex B hereto; provided, however, that at no time shall the Available Cash be debited from the Customers Account unless the U.S. Treasuries are simultaneously credited to the Segregated Account (as defined below); (b) transfer proceeds from the sale or disposition (whether at maturity or obtained via automatic redemption, sale or otherwise) of U.S. Treasury securities to the Futures Account to, (i) satisfy debits and margin calls in the Account, (ii) fund settlement of transactions Customer or Advisor or Customers designated and duly authorized Account controller has executed for the Account, in the case of (i) and (ii), only if the Withholding Amount is insufficient and (iii) in the absence of Customer instructions to the contrary, redeem proceeds from the maturity of U.S. Treasury securities and use such proceeds to purchase U.S. Treasury securities in the next available tenor of the same or substantially comparable maturities as the U.S. Treasury securities just redeemed; (c) discharge Customers instructions as set forth in this Agreement without any further authorizations or consents; and (d) present this Agreement to any regulator, governmental authority or self-regulatory authority or in any administrative or judicial proceeding as verification that MS&Co. has authority to take action with respect to such U.S. Treasury securities on behalf of Customer as instructed herein.
3. Relationship to MS&Co. Customer understands and agrees as follows:
(a) | U.S. Treasury securities purchased pursuant to this Agreement will at all times be held by MS&Co. for the benefit of Customer in segregation in an omnibus customer account (each, as applicable, a Segregated Account) in accordance with the provisions of Section 4d(a) of the Commodity Exchange Act (Act) and Regulation 1.20 or Regulation 30.7, as applicable, of the regulations of the Commodity Futures Trading Commission (CFTC) promulgated thereunder, and will at all times be reflected on MS&Co.s books and records as customer segregated assets, in accordance with the applicable requirements of the Act and the CFTCs regulations thereunder. MS&Co. will mark its books and records to indicate the amount of U.S. Treasury securities held for each Fund in the Segregated Account. |
(b) | U.S. Treasury securities purchased pursuant to this Agreement will, so long as they are custodied in a Segregated Account, be eligible to satisfy Customers margin requirements for its Futures Account with MS&Co., subject to the relevant provisions of the Futures Agreement; |
(c) | MS&Co. shall have no duties or responsibilities to Customer in connection with the Service except those duties and responsibilities expressly set forth herein and as may exist under Applicable Law; |
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(d) | MS&Co. is not in any way acting as Customers fiduciary in connection with the Service or the authorizations and instructions set forth herein, and Customer is not relying on any communications or statements (written or oral) of MS&Co. as investment advice or as a recommendation from MS&Co. or its employees to purchase or sell U.S. Treasury securities; |
(e) | U.S. Treasury securities custodied in a Segregated Account will be reflected on MS&Co.s statements of Customers collateral held in segregation pursuant to Section 4d(a)(2) of the Act or as 30.7 customer funds pursuant to CFTC Regulation 30.7, as applicable; |
(f) | Customer bears the sole risk of any decline in the value of the U.S. Treasury securities and understands that any such decline in value may, to the extent that such U.S. Treasury securities are being held as Collateral under the Futures Agreement, give rise to a shortfall in its margin requirement under the Futures Agreement; and |
(g) | This Agreement and the Service is not an offer to buy or sell or a solicitation of an offer to buy or sell U.S. Treasury securities or to participate in any particular trading strategy. |
4. Revocation of Authorizations. The authorizations and instructions set forth herein shall remain in full force and effect until MS&Co. receives a written notice of revocation from Customer and MS&Co. acknowledges such revocation to Customer in writing within two (2) business days of MS&Co.s receipt of such written notice.
5. Termination of the Service. MS&Co. may terminate the Service at any time and for any reason upon notice to Customer. Customer shall remain responsible for all authorized charges that arise prior to such termination. Notwithstanding any such termination, MS&Co shall provide the Service until the maturity date of the U.S. Treasuries held in the Customers Account at the time the notice to terminate was received by the Customer.
6. U.S. Treasury Securities as Collateral. Customer agrees that all U.S. Treasury securities purchased through the Service will be deemed Collateral (as that term is used in the Futures Agreement) held in and for the Account.
7. Liens and Other Secured Interests. Customer hereby (i) assigns, pledges and transfers to MS&Co. all of Customers right, title and interest in the U.S. Treasury securities purchased pursuant to this Agreement and (ii) understands and agrees that MS&Co. may use any U.S. Treasury securities held in a Segregated Account for the purpose of collateralizing Customers obligations under the Futures Agreement (in accordance with the terms thereof). MS&Co. shall, at all times when U.S. Treasury securities are custodied in a Segregated Account, retain a security interest and right of setoff, to the extent set forth in the Futures Agreement with respect to Collateral as defined therein, in and with respect to such U.S. Treasury securities. For the avoidance of doubt, the parties hereto acknowledge and agree that the purchase of U.S. Treasury securities with Available Cash from Customers Futures Account as part of the Service shall not constitute a permitted investment as defined in CFTC Regulation 1.25.
8. Certain Procedures. MS&Co. is hereby authorized and instructed to calculate Available Cash through the following procedures. MS&Co. shall first calculate Customers excess equity in the form of available USD cash balances held on Customers behalf by MS&Co. in the Account subject to and in accordance with the provisions of the Futures Agreement (the Excess Equity). For the avoidance of doubt, Excess Equity may, at the discretion of MS&Co., be determined after taking into account any rights of set-off, netting and any other application of Customers cash balances to its obligations owed to MS&Co. (or, if applicable, its affiliates) to the extent permitted under the Futures Agreement. MS&Co. shall then subtract the Withholding Amount from the Excess Equity. ( The resulting amount is then available for the purchase of U.S. Treasury Securities in connection with MS&Co.s provision of the Service pursuant to the terms of this Agreement.
MS&Co. is hereby authorized and instructed to withhold from inclusion in its computation of Excess Equity a percentage of available cash, as determined by Customer in its discretion (the Withholding Amount), for the purpose of (i) satisfying Customers obligations in respect of the Futures Account for that day; (ii) satisfying Customers margin requirements in respect of the Futures Account for that day and (iii) protecting against the possibility of adverse market moves causing Customer to incur a debit balance in the Futures Account.
9. ERISA. Except as disclosed to MS&Co. in writing, Customer continuously represents that it is not (a) an employee benefit plan (hereinafter an ERISA Plan), as defined in Section 3 (3) of the Employee Retirement Income Security Act of 1974, as amended (ERISA), subject to Title I of ERISA or Section 4975 of the Internal Revenue Code of
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1986, as amended (Code), or subject to any other statute, regulation, procedure or restriction that is materially similar to Section 406 of ERISA or Section 4975 of the Code or which contain any prohibition against entering into any transaction under this Agreement (together with ERISA Plans, Plans), (b) a person acting on behalf of a Plan or (c) a person the assets of whom constitute assets of a Plan. Customer will provide notice to MS&Co. in the event that it is aware that it is in breach of any aspect of this representation or is aware that with the passing of time, giving of notice or expiry of any applicable grace period, it will breach this representation.
10. Miscellaneous Provisions. Those provisions in Customers Futures Agreement with MS&Co. regarding matters not otherwise expressly addressed in this Agreement shall have the same meaning and effect as if the provisions were part of this Agreement.
Customer represents that it is authorized to enter into this Agreement and utilize the Service and has obtained any consents and made any disclosures necessary regarding its investment in U.S. Treasury securities and the fees and expenses associated with such investment.
In witness whereof, Customer has caused this Agreement to be executed by its officer or duly authorized representative as of the date first above written.
CUSTOMER-: Each fund set forth on Annex A (which may be amended from time to time in accordance with the provisions of the Futures Agreement), attached hereto, in their individual capacity.
Signature: /s/ Patrick T. Egan
Title: President and Director Ceres Managed Futures LLC
Date: October 29, 2015
Acknowledged and agreed by:
MORGAN STANLEY & CO. LLC
Signature: /s/ Craig T. Abruzzo
Title: Managing Director
Date: October 29, 2015
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Annex A
List of Funds
Morgan Stanley Smith Barney Spectrum Select L.P.
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ANNEX B
U.S. Treasury Securities Specifications
Characteristic | Specification | |
Type: | ||
Denomination: | ||
Tenor/Maturity Date: |