EFTA00236813.pdf

UBS Alternative Investments AlphaKeys Millennium Funds Access to a hedge fund with a multi-strategy approach to investing Unless otherwise noted, the information in this document is valid only as of the date hereof and is subject to change. This communication is confidential and is intended solely for the information of the person to whom it has been delivered. It may not be copied or distributed to the public. ML281837-MAXWELL September 2014 Private and confidential CONFIDENTIAL UBSTERRAMAR00001167 EFTA00236813  This page is intentionally left blank ML281837-MAXWELL CONFIDENTIAL UBSTERRAMAR00001168 EFTA00236814  AlphaKeys Millennium Funds UBS offers four different funds, each created to invest substantially all of its assets in a multi-strategy hedge fund managed by Millennium Management LLC AlphaKeys Millennium Fund AlphaKeys Millennium Fund invests in: Millennium feeder funds invest in: Millennium Strategic Capital LP AlphaKeys Millennium Fund Ill, LLC (Class B Interests) Delaware LLC formed July 2012 formed July 2011 Millennium USA LP AlphaKeys Millennium Fund II, LLC (Class NN-Ill Interests) Delaware LLC formed April 2011 formed January 1998 Millennium Partners, LP (the "Millennium Master Fund") Millennium USA LP formed 1989 AlphaKeys Millennium Fund, LLC (Class Interests) Delaware LLC formed February 2011 formed January 1998 AlphaKeys Millennium Fund (Offshore), Ltd. Millennium International Ltd. Cayman Islands exempted company with limited (Class FF-Ill Shares) liability formed May 2011 formed January 1998 Investors in the AlphaKeys Millennium Funds are not shareholders of the Millennium feeder funds or Millenniun Partners, LP and will have no voting rights or direct interest in, and will have no standing recourse against Millennium Management, the Millennium Funds, or their respective partners and affiliates. The terms of each fund differ and are described in each fund's fact sheet and confidential offering memorandum. Prospective investors should read those documents carefully and familiarize themselves with the terms of the funds before investing. 1837-MAXWELL (SUBS Private and confidential 1 CONFIDENTIAL UBSTERRAMAR00001169 EFTA00236815  AlphaKeys Millennium Funds' The AlphaKeys Millennium Funds are offered exclusively to UBS clients. • Interests in the AlphaKeys Millennium Funds are sold only to qualified investors who understand, and are able to bear the risks associated with these investments • Investors in the AlphaKeys Millennium Funds will not be limited partners in Millennium Partners LP (the "Millennium Master Fund"), or any of its feeder funds, and may not vote or otherwise participate in any matters related to those funds • Investments in the AlphaKeys Millennium Funds are subject to limited liquidity and for certain funds, lock-up periods • Investments in the AlphaKeys Millennium Funds are illiquid and require a long-term view to investing. When considering an investment in any of the AlphaKeys Millennium Funds, consider the terms of the AlphaKeys Millennium Funds as well as the impact of your overall commitment on your short- term and long-term liquidity needs • The AlphaKeys Millennium Funds will each bear all expenses for its investment activities and operations and indirectly, it will bear its proportionate share of the expenses of the Millennium feeder fund in which it invests. Please see Important information and select risks section on page 29 for a summary of the investment risks associated with an investment in the AlphaKeys Millennium Funds. Please review the Confidential Offering Memorandum of the AlphaKeys Millennium Fund you are considering carefully for a more detailed description of the risks associated with these investments. The information presented relating to Millennium Management LLC and the Millennium Funds was obtained by UBS Financial Services Inc. from the Confidential Offering Memorandum (including the supplements thereto) and certain other materials furnished by Millennium Management to prospective investors in the Millennium Funds. Neither UBS, the AlphaKeys Millennium Funds, or their officers and employees participated in the preparation of, or independently verified, that information. ' AlphaKeys Millennium Funds refers collectively to AlphaKeys Millennium Fund, LL.C., AlphaKeys Millennium Fund II, LL.C., AlphaKeys Millennium Fund (Offshore), Ltd. and AlphaKeys Millennium Fund III, LLC. The terms of each fund differ, and are described in each fund's fact sheet and confidential offering memorandum. Prospective investors should familiarize themselves with the terms of the funds before investing. Millennium Management does not assume any responsibility or liabikty for the information presented about UBS or the AlphaKeys Millennium Funds. --- 1837-MAXWELL (SUBS Private and confidential 2 CONFIDENTIAL UBSTERFtAMAR00001170 EFTA00236816  AlphaKeys Millennium Funds its capital in Millennium Partners,LP(the:Millennium Master Fund").The AlphaKeys Millennium Funds 9.r!'ests its capital in Millennium Partners, LP (the "Millennium Master Fund").The AlphaKeys Millennium Funds are offered exclusively to UBS clients. The Millennium Master Fund's principal investment objective is to achieve above-average capital appreciation by opportunistically trading and investing in a wide variety of asset classes and strategies. • Multi-strategy hedge fund employing a multiple portfolio manager approach • Seeks to achieve attractive risk-adjusted non-market-correlated returns • Allocates capital globally across a diverse set of asset classes and strategies, including: — Relative value fundamental equity — Statistical arbitrage/quantitative strategies — Fixed income — Merger arbitrage/event-driven The accompanying footnotes and disclaimers at the end of the presentation are an integral part of this presentation and should be lead in conjunction herewith. ML281837-MAXWELL *UBS Private and confidential 3 CONFIDENTIAL UBSTERRAMAR00001171 EFTA00236817  Alternative Investments U.S. at UBS A comprehensive platform across hedge funds, managed futures, private equity and real estate UBS Global UBS UBS Wealth Management Americas Asset Investment Management Bank Wealth UBS Alternative Investments U.S Management Research Investor Investment Operational Business Product Sales services & due diligence due diligence development development finance • New York-based team currently totals approximately 50 professionals' • Robust platform with approximately $18.7 billion' in investments in private equity, real estate, hedge funds, and managed futures • Dedicated to offering market leading differentiated products • Open architecture platform provides access to a wide range of alternative investment managers • Unique access to investment opportunities through strong network of relationships with leading financial sponsors, operating partners and senior business executives • Comprehensive investment and operational due diligence, manager selection and ongoing monitoring process • Collaborative partnership within UBS Wealth Management Americas • Collaborative partnership within UBS AG. These services are available from and provided by UBS Global Asset Management U.S. and UBS Securities LLC, respectively ' As of June 30, 2014 1837-MAXWELL (SUBS Private and confidential 4 CONFIDENTIAL UBSTERRAMAR00001172 EFTA00236818  Millennium Management LLC The Millennium Master Fund is managed by Millennium Management LLC ("Millennium Management") Corporate overview • Founded in 1989 by Israel Englander, who has over 35 years of industry experience • Millennium Management LLC is registered as an investment adviser with the U.S. Securities and Exchange Commission • $23.8 billion in AUM' • Approximately 1,600 employees globally, with offices in the U.S., Europe and Asia • Global trading platform where portfolio managers invest independently of each other; trading technology designed to attract and support industry expertise • Bottom up, multi-manager trading platform structured across four core strategies with an aim to deliver repeatable alpha-driven returns with minimal volatility and market correlation • State-of-the-art institutional infrastructure provides capability to trade electronically on numerous exchanges worldwide • Multi-strategy investing approach with focus on non-directional trading • Headquartered in New York, NY • Risk management infrastructure with proprietary systems for monitoring of team limits and exposure The following slides provide more detail on Millennium and the Millennium Fund. Topics covered include: • Alignment of interests • Performance • Competitive edge • Investment strategy and philosophy • Risk Management and due diligence As of August 31, 2014 The accompanying footnotes aid disdaimers at the end of the presentation are an integral part of this presentation and should be read in conjunction herewith. Past performance is not indicative of future results. ML281837-MAXWELL *UBS Private and confidential 5 CONFIDENTIAL UBSTERRAMAR00001173 EFTA00236819  Alignment of interests Millennium Management's principals have invested significant amounts of their own capital in the Millennium feeder funds Investor breakdown' ■ 18% Commingled funds/Funds of funds ■ 12% Internal employee capital' ■ 34% Family offices/High net worth 36% Pensions/Endowments/Foundations/ Insurance/Other institutional As of August 31, 2014 ' Millennium Partners, LP total investor base Includes deferred compensation amounts already awarded to employees. The accompanying footnotes and disclaimers at the end of the presentation are an integral part of this presentation and should be lead in conjunction herewith. ML281837-MAXWELL SUBS Private and confidential 6 CONFIDENTIAL UBSTERRAMAR00001174 EFTA00236820  Historical and illustrative performance—AlphaKeys Millennium Funds Since inception, the Millennium funds have outperformed market indexes' January 1, 1990 — July 31, 2014 (net of 1% AlphaKeys Millennium Fund feet 524,000 AlphaKeys Millennium Funds $21,000 - AlphaKeys Millennium Fund, L.L.C. - AlphaKeys Millennium Fund II, LLC. $18,000 AlphaKeys Millennium Fund III, LL.C. AlphaKeys Millennium Fund (Offshore), LLC. S15,000 512,000 Indexes if RI Fund Weighted Composite Index $9,000 S&P 500 Index BofA ML U.S. 3-Month Treasury Bill Index $6,000 $3,000 ..1••••••• SO lan-90 Jan-92 Jan-94 Jan-96 Jan-98 Jan-00 Jan-02 tan-04 Jan-06 Jan-08 tan-10 Jan-12 Aug-14 ' The use of indexes is for illustrative purposes only. For more information about indexes, see "indexes" section at the end of the presentation. The 2008 return includes a OAAP reserve of up to -2.61% relating to a write-off of the total exposure relating to the Lehman bankruptcy The 2009 return includes a gain of up to 0.67% relating to accrued recoveries in the Lehman bankruptcy that are attributable only to certain investors in the Millennium feeder funds. The computation of returns may vary based on the timing of capital transactions. Performance shown prior to each AlphaKeys Millennium Fund date of formation is that of the respective Millennium feeder fund, net of fees and expenses at the Millennium feeder fund level. For AlphaKeys Millennium Fund only, performance prior to Millennium Strategic Capital date of formation is that of Millennium USA (which, like the Millennium Strategic Capital, invests primarily in Millennium Master Fund). Performance prior to each Millennium feeder fund date of formation is that of the Millennium Master Fund, net of fees and expenses at the Millennium Master Fund level. In each case, performance assumes a 1% administrative fee at the AlphaKeys Millennium Fund level but does not include AlphaKeys Millennium Fund expenses. Results post each AlphaKeys Millennium Fund date of formation include AlphaKeys Millennium Fund level expenses such as the offering and organizational expenses and fund operating expenses, but does not include a 2% placement fee, which would reduce returns. Please see page 1 for information on each fund structure and formation dates. UBS created feeder funds into the Millennium funds, and, therefore, returns for the AlphaKeys Millennium Funds will be lower than returns for a direct investment into a Millennium fund. Depending on invested amount, your AlphaKeys Millennium Fund fees may vary. Past performance is not indicative of future results. The accompanying footnotes and disclaimers at the end of the presentation are an integral part of this presentation and should be read in conjunction herewith. ML281837-MAXWELL *UBS Private and confidential 7 CONFIDENTIAL UBSTERRAMAR00001175 EFTA00236821  Why Millennium? Millennium Management seeks to achieve superior Millennium Management has a 23+ year track risk adjusted returns with low general market record of delivering what it believes is industry Return Quality correlation, beta and volatility, while maintaining leading long-term return quality' maximum liquidity Millennium Management's bottom-up, multiple Millennium Management believes this is an team structure seeks to be diversified across effective structure to extract alpha driven returns Diversification strategies, markets and sectors with centralized risk' with limited concentration of firm-wide risk management oversight exposure Legal/Compliance Oversight Risk Management I. Millennium Management has 40+ professionals dedicated to Compliance, Legal and Internal Audit Millennium Management has a 35+ Risk Management team with advanced proprietary Millennium Management believes it has created a high quality compliance, oversight and reporting discipline and infrastructure Comprehensive team-specific investment guidelines to provide clearly defined risk parameters, exposure technology for position/team level monitoring, tolerances and portfolio management standards evaluation and benchmarking Investment professional sourcing infrastructure Millennium Management draws on the industry's and skill to attract, support and manage expert elite, seeking stability of capital, top quality Trading Expertise trading teams infrastructure and certainty of performance-driven rewards V ' Since inception, the Millennium funds' average annual net return is higher than that of the HEW and the Millennium funds' standard deviation is lower than that of the HFRI. See page 13 for more information. The aocompanying footnotes and disdaimers at the end of the presentation are an integral part of this presentation and should be read in conjunction herewith. Past performance is not indicative of future results. `x,1837-MAXWELL (SUBS Private and confidential 8 CONFIDENTIAL UBSTERRAMAR00001176 EFTA00236822  Millennium Master Fund investment program Investment philosophy • Broadly diversified' strategy of opportunistic investing on a global basis • Invest in a number of types of securities and instruments that potentially offer the optimal opportunity for capital appreciation • Emphasis on consistency of returns, managing drawdowns and limiting losses Bottom-up approach • Source managers who run uncorrelated books in liquid strategies • Due diligence and comprehensive assessment of managers' strategy and risk • Employ specific control processes and set limits for each individual manager Senior management's role • Determine allocations to portfolio managers and strategies • Oversee and monitor portfolio managers • Approve limit exceptions • Manage hedge book to address direction and specific global event risk ' Millennium does not establish fixed guidelines regarding diversification of investments. The accompanying footnotes and disclaimers at the end of the presentation are an integral part of this presentation and should be lead in conjunction herewith. ML281837-MAXWELL SUBS Private and confidential 9 CONFIDENTIAL UBSTERRAMAR00001177 EFTA00236823  Core investment strategies Strategy' Objective of the Millennium Master Fund Relative value fundamental equity Identify changes in company fundamentals and relative mispricings Statistical arbitrage/ Develop algorithms that attempt to identify over/under-valued stocks Quantitative strategies Fixed income Capture inefficiencies in the fixed income market Merger arbitrage/Event driven Identify opportunities related to corporate reorganizations and restructurings ■ 38% Relative value fundamental equity ■ 28% Statistical arbitrage/Quantitative strategies ■ 22% Fixed income 7% Merger arbitrage/Event driven ■ 5% Other As of August 31, 2014 ' See "Core investment strategies glossary" at end of presentation for additional details. The accompanying footnotes and disclaimers at the end of the presentation are an integral part of this presentation and should be read in conjunction herewith. '21837-MAXWELL (SUBS Private and confidential 10 CONFIDENTIAL UBSTERFtAMAR00001178 EFTA00236824  Bottom up management structure Personnel Worldwide: 1600+ Non-Trading Professionals: 600+ Executive Level Firm Management Firm exposure management 20 Member Senior Committee Capital allocation/elimination • Legal/CoinplianceAnternal Audit: 55+ • Operations: 70+ Risk Manager Level Risk Management Risk limit construction/enforcement • Investor Services: 15+ 35+ Business Professionals Performance monitoring • Trading/Other: 60+ • Management/Admin: 70+ Trading Team Level Portfolio construction and Portfolio Management • Technology: 275+ management 945+ Investment Professionals 160+ Trading Teams • Accounting/Tax: 40+ As of August 31, 2014 The accompanying footnotes and disclaimers at the end of the presentation are an integral part of this presentation and should be lead in conjunction herewith. 837-MAXWELL UBS Private and confidential 11 CONFIDENTIAL UBSTERRAMAR00001179 EFTA00236825  Portfolio manager sourcing, selection and onboarding process Millennium Business Criteria: • Trading/position limit • Capital allocation Development (recruiting) • Track record construction • Active limit monitoring • Style & strategy • Pre-trading tests • Compliance oversight • Correlation External recruiters • Risk discipline • Infrastructure + tech • Infrastructure build • Performance monitoring requirements • Resource allocation • Cross-team benchmarking PM referrals Interviews: • Orientation • Business Development • Compliance training • Strategy heads and certification • Senior Management • Risk Management • IT and Infrastructure • HR • Background checks • Compliance review • Prof. references Average time: 2 to 6 Months The accompanying footnotes and disclaimers at the end of the presentation are an integral part of this presentation and should be read in conjunction herewith. n71837-MAXWELL UBS Private and confidential 12 CONFIDENTIAL UBSTERRAMAR00001180 EFTA00236826  Historical volatility—AlphaKeys Millennium Funds Millennium volatility vs. select indexes over a trailing 10-year period ended 7/31/20141 Rolling 12 month annualized standard deviation2 35% AlphaKeys Millennium Fund, L.L.C. — AlphaKeys Millennium Fund II, L.L.C. 30% — AlphaKeys Millennium Fund III, L.L.C. 25% AlphaKeys Millennium Fund (Offshore), Ltd. HFRI 20% — S&P 500 15% — HFRI Macro — HFRI FN 10% HFRI RV Multi/Sliat 5% HFRI Eq. MktlNeut — HFRI Eq. Hedge 0% 0 0 (.4 N en — HFRI ReWal (ci? 3 A A a A 0 a 0 A 0 A — HFRI FoF A ' The use of indexes is for illustrative purposes only. For more information about indexes, see "Indexes" section at the end of the presentation. The 2008 return includes a GAAP reserve of up to -2.61% relating to a write-off of the total exposure relating to the Lehman bankruptcy The 2009 return includes a gain of up to 0.67% relating to accrued recoveries in the Lehman bankruptcy that are attributable only to certain investors in the Millennium feeder funds. The computation of returns may vary based on the timing of capital transactions. Performance shown prior to each AlphaKeys Millennium Fund date of formation is that of the respective Millennium feeder fund, net of fees and expenses at the Millennium feeder fund level. For AlphaKeys Millennium Fund only, performance prior to Millennium Strategic Capital date of formation is that of Millennium USA (which, like the Millennium Strategic Capital, invests primarily in Millennium Master Fund). Performance prior to each Millennium feeder fund date of formation is that of the Millennium Master Fund, net of fees and expenses at the Millennium Master Fund level. In each case, performance assumes a 1% administrative fee at the AlphaKeys Millennium Fund level but does not include AlphaKeys Millennium Fund expenses. Results post each AlphaKeys Millennium Fund date of formation include AlphaKeys Millennium Fund level expenses such as the offering and organizational expenses and fund operating expenses, but does not include a 2% placement fee, which would reduce returns, Please see page 1 for information on each fund structure and formation dates. UBS created feeder funds into the Millennium funds, and, therefore, returns for the AlphaKeys Millennium Funds will be lower than returns for a direct investment into a Millennium fund. Dependng on invested amount, your AlphaKeys Millennium Fund fees may vary. Past performance is not indicative of future results. The accompanying footnotes and disdaimers at the end of the presentation are an integral part of this presentation aid should be read in conjunction herewith. ML281837-MAXWELL SUBS Private and confidential 13 CONFIDENTIAL UBSTERRAMAR00001181 EFTA00236827  Historical and illustrative performance and metrics— AlphaKeys Millennium Funds January 1, 1990 through July 31, 2014 (net of 1% AlphaKeys Millennium Fund fee) Average Annual Cumulative net Annualized Standard Sharpe % of up % of down total return2 net return2 deviation' Ratio months3 months3 AlphaKeys Millennium Funds AlphaKeys Millennium Fund III, LLC 2,193.0% 13.6% 4.5% 2.1 86.9% 13.1% AlphaKeys Millennium Fund II, LLC 2,021.6% 13.2% 4.4% 2.1 85.8% 14.2% AlphaKeys Millennium Fund, LLC 2,012.3% 13.2% 4.4% 2.1 85.8% 14.2% AlphaKeys Millennium Fund (Offshore), Ltd. 1,958.2% 13.1% 4.4% 2.1 85.8% 14.2% Indexes' HFRI 1,135.4% 10.8% 6.8% 1.1 70.8% 29.2% S&P 500 821.7% 9.5% 14.7% 0.5 64.7% 35.3% ' The use of indexes is for illustrative purposes only For more information about indexes, see -indexes" section at the end of the presentation. The 2008 return includes a GAAP reserve of up to -2.61% relating to a wnte-off of the total exposure relating to the Lehman bankruptcy. The 2009 return indudes a pan of up to 0.67% relating to accrued recoveries in the Lehman bankruptcy that are attributable only to certain investors in the Millennium feeder funds. The computation of returns may vary based on the timing of capital transactions. Performance shown prior to each AlphaKeys Millenniurn Fund date of formation is that of the respective Millennium feeder fund, net of fees and expenses at the Millennium feeder fund level. For AlphaKeys Millennium Fund only, performance prior to Millennium Strategic Capital date of formation is that of Millennium USA (which, like the Millennium Strategic Capital, invests primarily in Millennium Master Fund). Performance prior to each Millennium feeder fund date of formation is that of the Milenniurn Master Fund, net of fees and expenses at the Millennium Master Fund level. In each case, performance assumes a 1% administrative fee at the AJphaKeys Millennium Fund level but does not include AlphaKeys Millennium Fund expenses. Results post each AlphaKeys Millennium Fund date of formation indude AlphaKeys Millennium Fund level expenses such as the offering and organizational expenses and fund operating expenses, but does riot include a 2% placement fee, which would reduce returns. Please see page 1 for information on each fund structure and formation dates. UBS created feeder funds into the Millennium funds, and, therefore, returns for the AlphaKeys Millenniun Funds will be lower than returns for a direct investment into a Millennium fund. Depending on invested amount, your AlphaKeys Millennium Fund fees may vary. Past performance is not indicative of future results. The percentage of up and down months is calculated by dividing the number of months of positive (or negative) performance, net of all fees and expenses as described above, over the total number of months since Millennium Fund's inception. The accompanying footnotes and disclaimers at the end of the presentation are an integral part of this presentation and should be read in conjunction herewith. ML281837-MAXWELL *UBS Private and confidential 14 CONFIDENTIAL UBSTERRAMAR00001182 EFTA00236828  AlphaKeys Millennium Funds return quality vs. select indexes Millennium has delivered net returns with the highest sharpe ratio when compared against these indexes over a 10-year period', 2 Millennium net returns and volatility vs. select indexes over a trailing 10-year period ended 7/31/2014 10% AlphaKeys Millennium AlphaKeys Millennium Fund III, L.L.C. Fund, L.L.C. AlphaKeys Millennium Fund II, L.L.C. AlphaKeys Millennium Fund (Offshore), Ltd. 8% S&P 500 w ec O cc HFRI ReVVal • 13 6% c c o Ii H i ER IFA A • HFRI Eq. Hedge HFRI RV Multi/Stmt • 0 u 4% HFRI Macro s • HFRI FoF HFRI Eq. Mkt/Neut 2% 0% 3% 6% 9% 12% 15% Standard Deviation ' The use of indexes is for illustrative purposes only For more information about indexes, see "Indexes" section at the end of the presentation. The 2008 return includes a GAAP reserve of up to -161% relating to a write-off of the total exposure relating to the Lehman bankruptcy The 2009 return includes a gan of up to 0.67% relating to accrued recoveries in the Lehman bankruptcy that are attributable only to certain investors in the Millennium feeder funds. The computation of returns may vary based on the timing of capital transactions. Performance shown prior to each AlphaKeys Millennium Fund date of formation is that of the respective Millennium feeder fund, net of fees and expenses at the Millennium feeder fund level. For AlphaKeys Millennium Fund only, performance prior to Millennium Strategic Capital date of formation is that of Millennium USA (which, like the Millennium Strategic Capital. invests primarily in Millennium Master Fund). Performance prior to each Millennium feeder fund date of formation is that of the Millennium Master Fund, net of fees and expenses at the Millennium Master Fund level. In each case, performance assumes a 1% administrative fee at the AlphaKeys Millenn