Kiwibank Investment Portfolio. Investment Statement for the purposes of the Securities Act 1978

Transcription

1 Kiwibank Investment Portfolio Investment Statement for the purposes of the Securities Act 1978 Prepared as at 18 September 2015

2 AMP Investment Management (N.Z.) Limited is the Issuer and Manager of the Funds offered in this Investment Statement, which Kiwibank Investment Management Limited has selected to form part of the Kiwibank Investment Portfolio. AMP Capital Investors (New Zealand) Limited is a promoter of the Funds. Kiwibank Investment Management Limited is a distributor of the Funds, but not a promoter of the Funds. Kiwibank Investment Management Limited has not prepared this Investment Statement and is not responsible for its contents. Investments made in the Funds do not represent deposits or other liabilities of Kiwibank, Kiwibank Investment Management Limited, KB Custodial Limited, New Zealand Post Limited or any other member of the New Zealand Post Group. They are subject to investment and other risks, including possible delays in payment of withdrawal amounts in some circumstances, and loss of investment value. No person, including AMP Investment Management (N.Z.) Limited, AMP Limited, Kiwibank, Kiwibank Investment Management Limited, KB Custodial Limited, New Zealand Post Limited or any other member of the New Zealand Post Group, the Manager, any member of the AMP Group, the Trustee or the Crown, guarantees the performance of the Funds or the return of capital invested by you. In this Investment Statement, you or your refers to the investor or Unit Holder and we, us, our or Kiwibank Investment Management refers to Kiwibank Investment Management Limited, the distributor of the funds. Important information The information in this section is required under the Securities Act Investment decisions are very important. They often have longterm consequences. Read all documents carefully. Ask questions. Seek advice before committing yourself. Choosing an investment When deciding whether to invest, consider carefully the answers to the following questions that can be found on the pages noted below: Page What sort of investment is this? 12 Who is involved in providing it for me? 13 How much do I pay? 15 What are the charges? 15 What returns will I get? 17 What are my risks? 21 Can the investment be altered? 22 How do I cash in my investment? 23 Who do I contact with inquiries about my investment? 24 Is there anyone to whom I can complain if I have problems with the investment? 24 What other information can I obtain about this investment? 25 In addition to the information in this document, important information can be found in the current registered prospectus for the investment. You are entitled to a copy of that prospectus on request. 1

3 The Financial Markets Authority regulates conduct in financial markets The Financial Markets Authority regulates conduct in New Zealand s financial markets. The Financial Markets Authority s main objective is to promote and facilitate the development of fair, efficient, and transparent financial markets. For more information about investing, go to Financial advisers can help you make investment decisions Using a financial adviser cannot prevent you from losing money, but it should be able to help you make better investment decisions. Financial advisers are regulated by the Financial Markets Authority to varying levels, depending on the type of adviser and the nature of the services they provide. Some financial advisers are only allowed to provide advice on a limited range of products. When seeking or receiving financial advice, you should check: the type of adviser you are dealing with: the services the adviser can provide you with: the products the adviser can advise you on. A financial adviser who provides you with personalised financial adviser services may be required to give you a disclosure statement covering these and other matters. You should ask your adviser about how he or she is paid and any conflicts of interest he or she may have. Financial advisers must have a complaints process in place and they, or the financial services provider they work for, must belong to a dispute resolution scheme if they provide services to retail clients. So if there is a dispute over an investment, you can ask someone independent to resolve it. Most financial advisers, or the financial services provider they work for, must also be registered on the financial service providers register. You can search for information about registered financial service providers at You can also complain to the Financial Markets Authority if you have concerns about the behaviour of a financial adviser. Important notice This is an Investment Statement prepared in accordance with the Securities Act 1978 and the Securities Regulations 2009, relating to an offer of units in certain AMP Capital Investment Funds by AMP Investment Management (N.Z.) Limited. It is prepared as at, and is dated, 18 September We have been advised by AMP Investment Management (N.Z.) Limited that it intends transitioning the Funds to the new financial markets conduct regime introduced under the Financial Markets Conduct Act 2013 (FMCA) in the near future. As part of the transition of the Funds to the new FMCA disclosure regime, this Investment Statement will be replaced by a Product Disclosure Statement with other relevant information about the Funds being available to investors on the register entry that will be maintained in respect of them. In addition, the Trust Deed will be replaced with a new trust deed for the Funds that will comply with the requirements of the FMCA. Investment in the Funds will continue to be available as part of the Kiwibank Investment Portfolio after this transition process is completed. About the Kiwibank Investment Portfolio We are pleased to distribute the Kiwibank Investment Portfolio. You can choose from the Kiwibank Investment Portfolio investment option (or options) to suit your investment profile, taking into account the level of risk you are prepared to accept and the anticipated return you would like. We have selected three Funds from the AMP Capital Investment Funds range to be a part of the Kiwibank Investment Portfolio: Investment option Responsible Investment Leaders Conservative Fund Responsible Investment Leaders Growth Fund Responsible Investment Leaders Balanced Fund About the option Aims to provide you with above-cash returns over time with capital preservation while investing in line with responsible investment parameters. To do this, it uses appropriate diversification across asset types, with a distinct bias to income assets (e.g., bonds). Aims to provide you with high real returns over time but has correspondingly high risk while investing in line with responsible investment parameters. It uses diversification across asset types, with a distinct bias to growth assets (e.g., shares). Aims to provide you with modest real returns over time with medium risk while investing in line with responsible investment parameters. To do this, it uses diversification across asset types, with a mix of income assets (e.g., bonds) and growth assets (e.g., shares). The Manager has updated its model for calculating the benchmark returns for the AMP Capital Investment Funds (including, in respect of the AMP Capital Responsible Investment Leaders Conservative Fund and the AMP Capital Responsible Investment Leaders Growth Fund, by making these calculations using daily, rather than weekly, pricing data). This updated model has been applied retrospectively to the calculation of benchmark returns for past periods. Accordingly, the benchmark returns for the Funds disclosed in this Investment Statement may differ slightly from those disclosed in previous Investment Statements (with the result that the extent to which the actual gross returns are lower or higher than the corresponding benchmark returns may differ from that previously disclosed). When you invest in these Funds through us, your Units in the Funds will be held by KB Custodial as a custodian on your behalf. KB Custodial is one of our wholly owned subsidiaries and holds Units purchased through us on behalf of investors. Although you will be the beneficial owner of the Units, as the registered holder, 2

4 only KB Custodial will be able to exercise any rights, benefits and entitlements in relation to the Units. KB Custodial s Terms and Conditions, which set out the basis on which it holds your Units and exercises those rights, benefits and entitlements, are set out in the application form. In addition to the services detailed in this Investment Statement, Kiwibank provides services to investors, such as internet banking services. Accordingly, you should also refer to, and if you invest in the Funds, you are bound by, Kiwibank s General Terms and Conditions. These terms govern your use of these Kiwibank services. Kiwibank s General Terms and Conditions are available on Kiwibank s website at or at your local Kiwibank. KB Custodial s Terms and Conditions (which govern the basis on which KB Custodial holds Units on your behalf) are set out in the application form attached to this Investment Statement. You are required to obtain a copy of this Investment Statement prior to investing in the Funds. You should ensure that you take the time to read this Investment Statement (including the application form and KB Custodial s Terms and Conditions), Kiwibank s General Terms and Conditions, and any other relevant documentation before making your investment decisions. About Kiwibank Investment Management We are a distributor of the Funds and are not a promoter of the Funds for securities law purposes. This Investment Statement has been prepared by the Manager, rather than us, and we are not responsible for its contents. We are a wholly-owned subsidiary of Kiwibank. About Kiwibank Limited Kiwibank s background Kiwibank is a wholly-owned subsidiary of New Zealand Post Limited, a state-owned enterprise under the State-Owned Enterprises Act New Zealand Post Limited is the main postal services provider in New Zealand. Kiwibank opened for business early in 2002, with the vision of making a difference to the New Zealand banking industry. Kiwibank sought to prove that there was room for a New Zealand-owned bank to profitably provide better service, better products, lower fees and better interest rates to New Zealanders. Kiwibank s strategy drew from the country s past, where historically there had been a bank operating through the Post Office network, and it looked to the future by embracing new technology and a new way of dealing with customers. Kiwibank s strategy is to capture and retain customers through offering high levels of customer service, competitive pricing and continuous innovation in financial products. As at the date of this Investment Statement, Kiwibank employs about 1,200 staff across the country. Kiwibank s registration On 29 November 2001, Kiwibank was registered as a bank under the Reserve Bank of New Zealand Act Kiwibank is required to comply with the conditions of registration as laid down by the Reserve Bank of New Zealand. The conditions of registration include, but are not limited to: governance (including board composition); minimum capital levels; risk measurement processes; and quantitative liquidity risk management requirements. Kiwibank s full conditions of registration can be found in Kiwibank s latest Disclosure Statement and Annual Report at legal-docs.asp. Kiwibank s principal activities Kiwibank offers a range of personal and business transactional banking, savings accounts, term deposits, home loans, credit cards and revolving credit products. Kiwibank intends to continually add to its product suite. About AMP Investment Management (N.Z.) Limited AMP Investment Management (N.Z.) Limited is the Issuer and Manager of the Funds and as such is responsible for the management and administration of the Funds in accordance with the terms of the Trust Deed. About AMP Capital Investors (New Zealand) Limited AMP Capital is the investment manager and a Promoter of the Funds. AMP Capital is a leading specialist investment manager managing around $19 billion* for New Zealand investors. As a majority owned subsidiary of AMP Limited, AMP Capital operates independently with a pure investment focus, but benefits from the resources of its parent. With over 200 in-house investment professionals throughout Australasia and a carefully selected global network of investment partners, the AMP Group offers significant depth and breadth of investment expertise. Increasingly, delivering superior returns to clients involves looking beyond traditional techniques to a new generation of investment portfolios. These require the blending of any number of inputs such as securities, asset classes, countries, styles and even managers to obtain the optimal risk and return outcome. To do this well requires real depth of in-house investment expertise, a business philosophy open to partnering, and specialist capabilities designed to integrate and maximise the two. At AMP Capital, there are specialist investment teams across a diverse range of disciplines. Each team focuses on searching out and creating the best investment outcomes for clients. * As at 31 August

5 AMP Capital also collaborates with like-minded investment specialists around the world, leveraging our joint expertise to create new investment opportunities. This investment approach capitalises on the strength and breadth of AMP Capital s investment expertise and is characterised by three distinctive capabilities: Multiple perspectives: research drives every investment decision. Specialist investment teams interact, sharing knowledge and insights to gain multiple perspectives. This diversity of thought allows AMP Capital to see things differently, often producing unique insights that create new ways to add value to clients portfolios. Access to rare investment opportunities: scale, brand and relationships give AMP Capital a competitive edge in deal sourcing and origination. This access to rare assets opens up new and different investment opportunities for clients. Progressive portfolio construction: the new generation of investment portfolios demand increasingly complex portfolio construction decisions. With this in mind, AMP Capital has developed proprietary skills and processes that allow it to select and blend a wide range of investment inputs, from individual securities to the right investment partner. AMP Capital uses these skills to meet the diverse risk return objectives of AMP Capital s clients. Underpinning these capabilities are AMP Capital s people. AMP Capital seeks to attract the best people, invest in their ongoing professional development, and ensure that their interests are clearly aligned with those of AMP Capital s clients. The combination of scale, breadth and capability provides access to superior investment opportunities. Reliably, consistently, repeatedly. 4

6 Kiwibank Investment Portfolio Responsible Investment Leaders Conservative Fund Investment strategy The Responsible Investment Leaders Conservative Fund aims to provide you with above-cash returns over time with capital preservation whilst investing in line with responsible investment parameters (see the Approach to responsible investing section on page 12 for more detail). To do this, it uses diversification across asset types, with a distinct bias to income assets (e.g., bonds). Key features A diverse range of predominantly income assets including fixed interest securities and cash, plus some growth assets including shares, property and commodities, across New Zealand and global markets. One of the most experienced investment management teams for New Zealand investments. Active management of asset allocations to suit changing investment environments and conditions. This Fund will invest primarily in other funds, including funds managed by the Manager or associates of the Manager, but may invest in directly held assets. See pages 92 to 94 of the Prospectus for a table showing the funds managed by the Manager or an associated person of the Manager in which more than 10% of the value of the Fund has been invested. Investment guidelines The benchmark asset mix noted below is the expected average asset mix of the Responsible Investment Leaders Conservative Fund over the long-term. In the short-term and medium-term, AMP Capital will actively manage the Fund within the given ranges: Benchmark (%) New Zealand Cash 25 New Zealand Fixed Interest 25 Global Fixed Interest 25 Range (%) Total Cash and Fixed Interest Australasian Shares 5 Global Shares 10 Commodities 3 Property 1 7 Total Growth Assets Total Includes both New Zealand and Global Property. Currency management AMP Capital targets a position of the Fund s exposure to foreign currency (excluding Australian dollar) shares being 50% hedged to the New Zealand dollar (on a net after tax basis, based on the current maximum PIR). For Australian dollar shares, AMP Capital targets a position of the Fund s exposure being 50% gross hedged to the New Zealand dollar. For all other asset classes, AMP Capital targets 100% currency hedging of foreign currency exposure to the New Zealand dollar. AMP Capital has the discretion to alter these target positions should this be deemed appropriate. Use of derivatives The Fund may use derivatives to manage risk and facilitate rebalancing and asset allocation. Performance objective To outperform, over the medium term, the weighted average return of the market indices used to measure performance of the underlying funds/assets in which the fund invests. Annual Returns to 31 March The return received by you if you invest in this Fund will be less than the Gross Return outlined above once Management Fees, performance fees (if any), expenses and taxes are deducted % 4.49% 6.10% 6.13% 6.08% 6.85% 8.21% 8.90% 9.01% 8.83% 0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% Gross Return Benchmark The performance information set out above shows the performance of the Fund before it commenced investing in accordance with responsible investment parameters on 16 April

7 Responsible Investment Leaders Growth Fund Investment strategy The Responsible Investment Leaders Growth Fund aims to provide you with high real returns over time but has correspondingly high risk whilst investing in line with responsible investment parameters (see the Approach to responsible investing section on page 12 for more detail). It uses diversification across asset types, with a distinct bias to growth assets (e.g., shares). Key Features A diverse range of predominantly growth assets including shares, property and commodities, plus some income assets including fixed interest securities and cash, across New Zealand and global markets. One of the most experienced investment management teams for New Zealand investments. Active management of asset allocations to suit changing investment environments and conditions. This Fund will invest primarily in other funds, including funds managed by the Manager or associates of the Manager, but may invest in directly held assets. See page 92 to 94 of the Prospectus for a table showing the funds managed by the Manager or an associated person of the Manager in which more than 10% of the value of the Fund has been invested. Investment guidelines The benchmark asset mix noted below is the expected average asset mix of the Responsible Investment Leaders Growth Fund over the long-term. In the short-term and medium-term, AMP Capital will actively manage the Fund within the given ranges: New Zealand Cash 5 New Zealand Fixed Interest 2.5 Global Fixed Interest 2.5 Benchmark [%] Range [%] Total Cash and Fixed Interest Australasian Shares 22.5 Global Shares 52.5 Commodities 5 Property 5 10 Total Growth Assets Total Includes both New Zealand and Global Property. Currency management AMP Capital targets a position of the Fund s exposure to foreign currency (excluding Australian dollar) shares being 50% hedged to the New Zealand dollar (on a net after tax basis, based on the current maximum PIR). For Australian dollar shares, AMP Capital targets a position of the Fund s exposure being 50% gross hedged to the New Zealand dollar. For all other asset classes, AMP Capital targets 100% currency hedging of foreign currency exposure to the New Zealand dollar. AMP Capital has the discretion to alter these target positions should this be deemed appropriate. Use of derivatives The Fund may use derivatives to manage risk and facilitate rebalancing and asset allocation. Performance objective To outperform, over the medium term, the weighted average return of the market indices used to measure performance of the underlying funds/assets in which the Fund invests. Annual Returns to 31 March % 0.81% 10.31% 8.93% 10.74% 9.48% 13.15% 14.57% 15.54% 16.27% Gross Return Benchmark The performance information set out above shows the performance of the Fund before it commenced investing in accordance with responsible investment parameters. The return received by you if you invest in this Fund will be less than the Gross Return outlined above once Management Fees, performance fees (if any), expenses and taxes are deducted. Responsible Investment Leaders Balanced Fund Investment strategy The Responsible Investment Leaders Balanced Fund aims to provide you with modest real returns over time with medium risk whilst investing in line with responsible investment parameters (see the Approach to responsible investing section on page 12 for more detail). To do this it uses diversification across asset types, with a mix of income assets (e.g., bonds) and growth assets (e.g., shares). Key features A diverse range of growth and income assets including shares, property, commodities, fixed interest securities and cash, across New Zealand and global markets. 6

8 One of the most experienced investment management teams for New Zealand investments. Annual Returns to 31 March Active management of asset allocations to suit changing investment environments and conditions. This Fund will invest primarily in other funds, including funds managed by the Manager or associates of the Manager, but may invest in directly held assets. See pages 92 to 94 of the Prospectus for a table showing the funds managed by the Manager or an associated person of the Manager in which more than 10% of the value of the Fund has been invested A robust investment process that combines a sustainability focus with stringent financial analysis. Investment guidelines The benchmark asset mix noted below is the expected average asset mix of the Fund over the long-term. In the short-term and medium-term, AMP Capital will actively manage the Fund with a view to establishing and maintaining the Fund s asset mix within the given ranges. There may be times when an asset class is not represented (or is not within the specified range) due to compliance with the responsible investment charter for the Fund % 4.88% 8.78% 7.82% 8.25% 10.95% 13.06% 13.34% 12.92% 14.96% Gross Return Benchmark New Zealand Cash 10 New Zealand Fixed Interest 15 Global Fixed Interest 15 Benchmark [%] Range [%] Total Cash and Fixed Interest Australasian Shares 15 Global Shares 31 Commodities 4 Property 10 Total Growth Assets Total 100 Currency management AMP Capital targets a position of the Fund s exposure to foreign currency (excluding Australian dollar) shares being 50% hedged to the New Zealand dollar (on a net after tax basis, based on the current maximum PIR). For Australian dollar shares, AMP Capital targets a position of the Fund s exposure being 50% gross hedged to the New Zealand dollar. For all other asset classes, AMP Capital targets 100% currency hedging of foreign currency exposure to the New Zealand dollar. AMP Capital has the discretion to alter these target positions should this be deemed appropriate. Use of derivatives The Fund may use derivatives to manage risk and facilitate rebalancing and asset allocation. Performance objective To outperform, over the medium term, the weighted average return of the market indices used to measure performance of the underlying funds/assets in which the fund invests. The return received by you if you invest in this Fund will be less than the Gross Return outlined above once Management Fees, performance fees (if any), expenses and taxes are deducted. Approach to responsible investing AMP Capital has established a Responsible Investment Committee which is responsible for assessing the investments of the Responsible Investment Leaders Balanced Fund, the Responsible Investment Leaders Conservative Fund and the Responsible Investment Leaders Growth Fund, from a socially responsible, financial and environmental perspective, and which monitors adherence to the Responsible Investment Charter that has been established for the Funds. Where one of the relevant Funds invests in global share funds, the Responsible Investment Committee will seek out funds or fund managers which are identified leaders across the industries in a range of areas including: Environmental considerations including energy and resource use and product stewardship (for example, where a company takes into account the life cycle of the product, from manufacture to the extent to which the product can be recycled). Social considerations including indigenous relations and community involvement. Ethical considerations including meeting fundamental human rights, and articulating and implementing a code of conduct. Labour standards including occupational health and safety, International Labour Organisation standards, working conditions and the exclusion of child labour. Governance considerations including meeting corporate governance guidelines on board structures and remuneration. 7

9 Additionally, fund managers and funds will also be well regarded if they actively participate in corporate engagement and governance initiatives. Where a Fund invests directly in shares, these share investments will also be measured against the above considerations. The Fund will (at a minimum) avoid investment in any company which has a substantial exposure to sectors identified as having a high negative social impact. This means the Fund will avoid exposure, either directly or indirectly through underlying managers and funds, to companies with material exposure to the production or manufacture of alcohol, armaments, gambling, pornography, tobacco and nuclear power (including uranium). Material exposure is considered to be where a company derives more than 10% of its total revenue from these industries. In addition, with the combustion of fossil fuels being the main source of global greenhouse gas emissions, each of the Funds seeks to limit exposure to companies which have a material exposure to the most carbon intensive fossil fuels by excluding any company that has more than a 20% exposure (as measured by percentage of market capitalisation, or other appropriate financial metric) to one, or a combination of, the following: Mining thermal coal. Exploration and development of oil sands. Brown-coal (or lignite) coal-fired power generation. Transportation of oil from oil sands. Conversion of coal to liquid fuels/feedstock. Retention and realisation policy If an investment falls below these responsible investment standards, it is the policy of the Responsible Investment Committee to seek to exit that investment within six months after becoming aware of this unless remedial action is taken to bring the investment back within the responsible investment parameters. An investment may also be realised at any time for financial reasons. Further information Further information about the responsible investment processes can be obtained online at What sort of investment is this? The securities offered are Units in the following AMP Capital Investment Funds: Responsible Investment Leaders Conservative Fund Responsible Investment Leaders Growth Fund Responsible Investment Leaders Balanced Fund The Funds are Unit Trusts established under the Unit Trusts Act 1960 and the Trust Deed. The Trust Deed was amended and restated on 2 April Each Unit in a Fund is of equal value and confers an equal interest in that Fund. A Unit gives you a beneficial interest in the Fund s Assets. The benefit is undivided. This means you do not have an interest in any particular part of a Fund or in a particular Asset of a Fund. The Assets of one Fund cannot be used to cover the Liabilities of another Fund. The Investment Policy and investment guidelines reflect the Manager s current intention in relation to each of the Funds. The Manager sets the initial Investment Policy and investment guidelines for each Fund and obtains the Trustee s approval to any changes. Before putting into effect any material changes to the Investment Policy for a Fund, the Manager will give notice of the changes to Unit Holders of the relevant Fund in accordance with the terms of the Trust Deed. You should note that while markets have generally improved since the global financial crisis they do remain volatile and you may experience fluctuations in returns. The Investment Policy and investment guidelines for a Fund set out the investment objectives, strategy and philosophy for the Fund and may include directions on: the level of borrowing and the circumstances in which a Fund may borrow; the use of derivatives; currency management; exposure limits for certain securities; and the duration of securities held by a Fund. Who is involved in providing it for me? The names of the unit trusts established under the Unit Trusts Act 1960 and the Trust Deed and offered in this Investment Statement are: AMP Capital Responsible Investment Leaders Conservative Fund AMP Capital Responsible Investment Leaders Growth Fund AMP Capital Responsible Investment Leaders Balanced Fund Listed below are the details of the organisations involved in providing these Funds for you as part of the Kiwibank Investment Portfolio: The Manager AMP Investment Management (N.Z.) Limited Ground Floor, PWC Tower The Terrace PO Box 3764 Wellington 6140 Telephone: (04) Fax: (04) ampcapital@ampcapital.co.nz 8

10 Directors of the Manager: Grant David Hassell BCA Wellington, New Zealand George William Carter BA (Hons), FNZSA, FIA Auckland, New Zealand Keith John Poore BCA (Hons), BSC (Hons), SA Fin Wellington, New Zealand Bevan Trevor Graham B.Soc.Sci (Economics) Wellington, New Zealand Directors of the Manager can be contacted at the Manager s address. The Promoters AMP Capital Investors (New Zealand) Limited Ground Floor, PWC Tower The Terrace PO Box 3764 Wellington 6140 The following directors of AMP Capital Investors (New Zealand) Limited who are not also directors of the Manager are also Promoters: Stephen James Peter Dunne (Chairman) BBus, MBA, CFA, F Fin Sydney, Australia Sharon Beverley Davis BA, Gr Dip Bus (Law), Gr Dip Mgt, Member of the Australian Institute of Company Directors, Fellow of FINSIA Sydney, Australia Christopher James Judd AssocDip in Valuations, AdvCert in Real Estate, Cert in Financial Markets Sydney, Australia Peter Raymond Verhaart BSc, PGDip FinMath, Dip Bus Stud Paraparaumu, New Zealand. Directors of AMP Capital can be contacted at AMP Capital s address. The Trustee The New Zealand Guardian Trust Company Limited Level 2, Dimension Data House Customhouse Quay PO Box 913 Wellington 6140 Telephone: (04) Fax: (04) Administration Manager AMP Capital Investors (New Zealand) Limited Ground Floor, PWC Tower The Terrace PO Box 3764 Wellington 6140 AMP Capital can, and does, contract out some or all of its administration tasks from time to time. Distributor Kiwibank Investment Management Limited Level 12, New Zealand Post House 7 Waterloo Quay Private Bag Wellington 5045 Telephone: Fax: (04) wealthadmin@kiwibank.co.nz Custodian KB Custodial Services Limited Level12, New Zealand Post House 7 Waterloo Quay Private Bag Wellington 5045 Telephone: Fax: (04) wealthadmin@kiwibank.co.nz The Issuer The Issuer for each of the Funds is AMP Investment Management (N.Z.) Limited. The principal activity for AMP Investment Management (N.Z.) Limited is the management and administrative control of investment funds. AMP Investment Management (N.Z.) Limited was incorporated as a company on 26 August 1987 and has been carrying on those activities since incorporation. AMP Investment Management (N.Z.) Limited is a wholly-owned subsidiary of AMP Capital and its ultimate holding company is AMP Limited (a company incorporated in New South Wales, Australia) through a majority shareholding in one of AMP Investment Management (N.Z.) Limited s holding companies. Any sale or disposal of Assets to AMP Investment Management (N.Z.) Limited or any of its Related Persons (which includes any investment fund managed by AMP Investment Management (N.Z.) Limited or its Related Persons) or the purchase or acquisition of any Assets from AMP Investment Management (N.Z.) Limited must be approved by the Trustee. You should be aware that the names of directors and addresses stated above may change from time to time without notice. Current names and addresses may be obtained by contacting the Manager at its address stated above. 9

11 How much do I pay? When you invest through us, the minimum initial lump sum investment for each Fund is $5,000. Thereafter, the minimum additional investment is $500 per Fund. The Manager may accept applications for lesser amounts in its absolute discretion. The Issue Price for Units in a Fund is the net asset value per Unit calculated by the Manager as at the date the application is accepted, unless the Trustee gives prior approval for the Issue Price to be the latest net asset value per Unit calculated as at a date before the application is accepted. You must complete the application form attached to this Investment Statement. The completed form, along with any additional information requested on the application form, can be provided to us at any Kiwibank branch or sent to: KB Custodial Services Ltd c/- Kiwibank Investment Management Limited Level 12, New Zealand Post House 7 Waterloo Quay Private Bag Wellington 5045 Payments by cheque are to be made payable to: KB Custodial Services Applications Account. Applications may be refused for any reason. Regular contributions can be made by automatic payment. If you are already a Kiwibank customer, you can set up an automatic payment from your Kiwibank account for your regular contributions by completing section 6 of the application form attached to this Investment Statement. If you are not a Kiwibank customer, please contact us on for assistance. Following the initial lump sum investment, the minimum regular contribution when you invest through us is $50 per fortnight per Fund. If a payment is dishonoured or reversed, no Units will be issued in respect of that payment or any Units issued based on that payment will be cancelled. Any funds paid to KB Custodial do not form part of the relevant Fund and neither the Manager nor the Trustee has any obligations towards those funds until KB Custodial pays those funds to the Manager or Trustee (or a nominated person of either of them) in return for the issue of Units. What are the charges? The fees set out in the table below are the fees that you will pay as a result of investing in each Fund. Fee type Amount p.a. (excluding GST unless stated otherwise) About the fee Investment Management Fees: Responsible Investment Leaders Conservative Fund 1.00% Responsible Investment Leaders Growth Fund 1.20% Responsible Investment Leaders Balanced Fund 1.10% This is the annual management fee. See note 1 below. Trustee Fee: Up to 0.1% Paid to the Trustee for services out of each of the Funds. See note 2 below. Entry / Exit fees: Entry Exit The Manager charges these fees on the purchase, Responsible Investment Leaders 0.08% 0.08% redemption or repurchase of Units. The fees stated in Conservative Fund this table are the entry and exit fees payable at the date of this Investment Statement. The Manager may vary Responsible Investment Leaders 0.25% 0.25% the entry and exit fees at any time. The entry and exit Growth Fund fees are inclusive GST. See note 3 below. Responsible Investment Leaders Balanced Fund 0.17% 0.17% In addition, the Funds may pay fees as a result of investing in other funds (including other funds managed by the Manager, AMP Capital or a related company) see notes 4 and 5 below. 10

12 Important notes 1. The Manager is entitled to deduct a management fee to each Fund of up to 2% per annum of the Value of the Assets of the Fund. The management fees (which are expressed as a percentage of the Value of the Assets of each Fund) as at the date of this Investment Statement are set out in the table above and are payable by quarterly instalments from the Fund. The Manager may vary the management fee for any Fund. GST is charged at 15% on10% of the management fee in accordance with the non-binding Inland Revenue agreement with the Financial Services Council of New Zealand Incorporated on behalf of the funds management industry. The Inland Revenue is reviewing the portion of management fees subject to GST and this percentage may change in the future. Upon the termination of a Fund, the Manager is entitled to be paid out of the Fund a reasonable fee of such amount as is approved by the Trustee, based on time spent by the Manager on matters relating to the termination of the Fund. There is no limit on the amount of this fee, apart from the requirement that it be reasonable in the circumstances and be approved by the Trustee. While the Manager has no current intention to do so, the Trust Deed allows the Manager to charge an initial service fee as determined by the Manager on the issue of any Unit. Any initial service fee, if it were to be charged, would be in addition to any entry fee. 2. The Trustee is entitled to be paid, by way of remuneration for its services, a fee out of each of the Funds. The Trustee s fee is determined on the basis of a scale agreed from time to time between the Trustee and the Manager. Currently, the Trustee s fee for each Fund is not to exceed 0.1% per annum of the average daily Value of the Assets of that Fund. There are no other limits on the amount of this fee in respect of each Fund. In addition, the Trustee is entitled to receive a fee of such amount as is from time to time agreed between the Manager and the Trustee for convening and attending meetings of Unit Holders. There is no limit on the amount of this fee. The Trustee is also entitled to be reimbursed for various expenses in accordance with the Trust Deed. On termination of a Fund, the Trustee is entitled to be paid from the Fund a reasonable fee of such amount as is approved by the Manager and based on the time spent by the Trustee on matters relating to the termination of the Fund. There are no limits on the amount of this fee in respect of each Fund, apart from the requirements that it must be reasonable in the circumstances and be approved by the Manager. 3. Entry and exit fees are expressed as a percentage of the relevant aggregate Issue Price or Repayment Price of the number of Units being purchased, redeemed or repurchased, and are paid into the relevant Fund. The entry and exit fees for each Fund are set by the Manager. The entry fee is a fee providing for the likely cost of purchasing or developing Assets for the Fund, and the exit fee is a fee providing for the likely cost of selling or disposing of Assets of the Fund. The Manager is entitled under the Trust Deed, and reserves the right to determine the entry and exit fees to be a higher or lower percentage than that stated in the table above (including zero). You will be advised of the applicable entry fee when you make a subscription and the applicable exit fee when you make a redemption request or your Units are repurchased. 4. Except as set out in note 5 below, no fees are currently charged in respect of investments made by any of the Funds in any other funds managed by the Manager, AMP Capital or a related company. 5. A performance fee may be payable to the Manager, AMP Capital, AMP Capital Investors Limited in Australia or any of the underlying managers used within the Funds. As at the date of this Investment Statement no performance fees are payable in respect of the Funds or other funds into which the Funds invest. Switching Units If you wish to switch your investment in one Fund to another Fund you should make a request through us. The Manager may refuse a switch request in its absolute discretion. To effect a switch, Units in the relevant Fund will be sold at the applicable Repayment Price (see the How do I cash in my investment? section on page 23 for information on calculation of the Repayment Price) and Units in the other Fund will be bought at the applicable Issue Price (see the How much do I pay? section on page 15 for information on calculation of the Issue Price). The entry and exit fees described above will generally apply. The provisions in the Trust Deeds applying to redemption or repurchase of Units and issue of Units will apply to switches. Other charges and expenses The Funds will incur brokerage and (where applicable) taxation and global custodial charges. Some of these charges may be paid to AMP Capital for performing investment administration tasks, or to other entities to which AMP Capital contracts investment administration tasks. All expenses incurred in the operation of the Funds will also be met fully by the Funds. The amount of the expenses and charges will be shown in the Financial Statements for each Fund. AMP Capital may, in its discretion, choose to cap the amount of any expenses and charges required to be met by any of the Funds. These charges may be varied from time to time in accordance with the Trust Deed for the relevant Fund. For further information on charges please contact us. 11

13 What returns will I get? The return on your investment reflects: the increase or decrease in the Unit price; and income distributions (for those Funds that make distributions, if any). The Unit price of a Fund reflects the value of the underlying assets of that Fund. The value of your investment at any time will therefore depend on the value of the underlying assets at that time. The value of Units may vary and, at times may even be less than you paid. Key factors that determine the Unit price and income distributions include market fluctuations in the value of Fund investments and the income received on them, tax and fees. You should note that while markets have generally improved since the global financial crisis they do remain volatile and you may experience fluctuations in returns. Unit prices may also be affected by currency movements where Assets are invested outside of New Zealand. Where considered appropriate, AMP Capital is empowered to use suitable Hedging* techniques to protect the value of investments in New Zealand dollar terms. No amount of returns, quantifiable as at the date of this Investment Statement and enforceable by you, is promised. No guarantees of capital or earnings are given, and past performance is not necessarily indicative of future returns. None of the Trustee or its nominee companies, the Manager, AMP Limited, AMP Capital or any member of the AMP Group or their respective directors or officers, Kiwibank, Kiwibank Investment Management, KB Custodial, New Zealand Post Limited or any other member of the New Zealand Post Group or any other person guarantees the value of the Units, repayment of any income on the Units or performance of the Funds. * See the glossary for an explanation of the term Hedging. Taxation Taxation is likely to affect returns from the Funds. The Funds are PIEs. KB Custodial will hold your Units in the Funds as a proxy for you. Accordingly, the Fund pays tax on the taxable income (referred to below simply as income ) attributed to KB Custodial on your behalf at 0%, and KB Custodial (as a proxy for you) will pay tax on that income at your selected PIR. What is a Prescribed Investor Rate (PIR)? Tax is paid by the relevant Fund on the income attributed to you at your PIR. A PIR is based on your taxable income (e.g., income from salary, wages and any additional sources of income that you would include in your income tax return) and the income attributed to you from any PIEs in which you invest, whether directly or through a proxy, including the Funds. The following PIRs apply: 10.5% for investors who are: New Zealand resident individuals who have provided their IRD number and who derived in either of the last two income years* preceding the current tax year $14,000 or less in taxable income (excluding PIE income) and $48,000 or less in taxable income and PIE income combined; or a New Zealand resident trustee of certain testamentary trusts that elects to have a 10.5% PIR; 17.5% for investors who are: New Zealand resident individuals who do not qualify for the 10.5% PIR but who have provided their IRD number and who derived in either of the last two income years* preceding the current tax year $48,000 or less of taxable income (excluding PIE income) and $70,000 or less in taxable income and PIE income combined; or a New Zealand resident trustee of a trust (except unit trusts and charitable trusts but including superannuation funds) that elects to have a 17.5% PIR; 28% for non-residents, New Zealand resident individuals who are not eligible for either the 10.5% PIR or 17.5% PIR and trusts (except unit trusts and charitable trusts but including superannuation funds) that elect to have a 28% PIR; 0% for the following entities (if resident in New Zealand): charities, PIEs, companies (including deemed companies such as unit trusts), proxies; and superannuation funds and trusts that have not elected to have a higher PIR. * Income year has the meaning given in section YA 1 of the Income Tax Act 2007 and for most investors means the year ending on 31 March Your actual rate will depend on your personal circumstances, including your taxable and PIE income in the two years preceding the current tax year and your tax residency. If you have recently become a New Zealand tax resident, you must include the total amount of your foreign sourced income in your assessable income when determining your PIR. However, you may choose not to determine your PIR on this basis in either or both of your first two years as a New Zealand tax resident, if you expect that your taxable income in either of these years to be significantly lower than your total income in the income year prior to becoming a New Zealand resident. The description of the PIRs above reflects the Manager and KB Custodial s understanding of tax laws as at the date of this Investment Statement. You should check that you have provided the correct PIR. If you do not notify us of your PIR, then the default rate of 28% will apply. In the case of joint investors the higher PIR of the joint investors is used. The Commissioner of Inland Revenue can require the Manager or KB Custodial to disregard the PIR notified to the Manager by you and apply a PIR notified by the Commissioner. For more information about PIR and to determine your correct PIR rate please refer to the IRD website or contact your professional tax adviser. Tax treatment if you are eligible for and notify us of a 0% PIR If you elect a 0% PIR, then KB Custodial (as proxy) will not have any tax liability in respect of income attributed to you. You must instead include the attributed income and claim any attributed losses as deductions in your own tax return. You will be responsible for payment of tax on the income attributed to you. 12

14 Tax credits for foreign withholding tax and other types of credits such as imputation credits are attributed to you to be credited against tax payable in your own tax returns. Tax treatment if you are eligible for and notify us of a PIR greater than 0% If you are eligible for and notify a PIR which is greater than 0%, the following will apply to you: KB Custodial (as proxy) will be liable to pay tax on income attributed to you at your PIR. If there are excess tax credits for a period or the relevant Fund has a loss rather than net income for a period, KB Custodial (as proxy) may in certain circumstances receive a tax refund and may be able to pass on the benefit of that refund to you. The tax paid on income attributed to you will be a final tax and you will not be required to file a tax return which includes that income, except if you are a trustee that elects the 10.5% or 17.5% PIR or if you have recently become a New Zealand tax resident and have chosen to disregard foreign income derived before becoming a New Zealand resident in determining your PIR. Such new residents and trustees that elect the 10.5% or 17.5% PIR will be required to file a tax return including its attributed income, with a credit allowed for any tax paid by KB Custodial (as proxy) on that income. If you have elected a PIR which is too low, or failed to advise the Manager that your PIR has increased, you will be liable to include your attributed income in a tax return and to pay tax on that income at your relevant marginal tax rate (with a credit allowed for tax paid on that income). You may also be liable for any penalties or interest which may apply. If you advise a PIR that is higher than your applicable rate, then you will not be able to claim back the excess tax paid. If the tax liability on income attributed to you exceeds your investment, some or all of your Units could be redeemed and the proceeds of the redemption paid to the IRD. To the extent this tax liability is not paid by the Fund, you may need to pay the tax directly to the IRD. The advantage of PIEs PIE funds provide some investors with a significant benefit over holding assets (or investments) directly. In particular, PIEs or proxies that invest in PIEs on behalf of others, pay tax on income attributed to investors at their relevant PIR which is capped at 28%. Investors in a PIE with a marginal tax rate of 33% who elect the 28% PIR will therefore obtain a tax advantage. Impact of PIE taxation for certain taxpayers In some circumstances your personal marginal tax rate could be lower than your PIR. In this event investing through a PIE may not be appropriate. In addition, investing in the Funds through KB Custodial (as proxy) may not be appropriate if you are a non-resident in New Zealand for tax purposes. This is because New Zealand tax will be imposed on income attributed by the Funds to you at 28%, which may be higher than the New Zealand tax rate that applies to income that you may get from other comparable New Zealand investments. (Note that these Funds are not foreign investment PIEs, the income from which that is attributed to notified foreign investors can be taxed at different rates.) Given that there are a number of circumstances where you may pay more tax in a PIE, rather than other forms of investment, it is important to consult your professional tax advisor to determine whether a PIE is best for you. Why do I need a PIR? The rules relating to the taxation of investment income enable funds that become PIEs to calculate their tax using PIRs elected by investors, which can be 28%, 17.5%, 10.5% or 0%, subject to satisfying various conditions. In order for KB Custodial to pay tax on your attributed income from the Funds at the appropriate rate (as a proxy), you need to ensure that you have supplied the correct PIR and IRD number at all times. When do I need to provide my PIR? You should provide your PIR when you invest in a Fund, along with your IRD number. Each year, you will be asked to reconfirm your PIR. You should review your rate each year to ensure it is correct and notify KB Custodial of any changes. It is important that you provide your PIR when requested. If you fail to provide your PIR or your IRD number then your investment will be taxed at the default rate of 28%. This rate could be higher than your PIR. If you provide a PIR that is lower than your correct PIR, you will be liable to pay tax on the attributed income at your relevant tax rate after allowing a credit for tax paid on that income by KB Custodial (as proxy) or the Fund (plus any applicable interest and penalties) and to file a tax return. If you advise a PIR that is higher than the applicable rate, you will not be able to claim back the excess tax paid. KB Custodial s responsibilities In relation to your investment in a Fund or Funds through us, KB Custodial (rather than the Manager) will be responsible for: calculating and organising payment of the tax liability on income attributed to you, using your PIR; making adjustments to the Units held on your behalf (by redeeming Units) or the distributions (if any) made to you or requiring you to make a payment to reflect the tax liability on income attributed to you; organising the provision of returns and other information to the IRD; and providing the Manager any information concerning you that may be relevant to whether the Fund continues to meet the eligibility requirements for a PIE (such as the Maximum Investor Interests requirement and the Minimum Number Of Investors requirement). This is because KB Custodial holds your Units on your behalf, as a custodian and proxy for you. 13

15 Proxies If you are investing through us as a proxy you will be required to carry out the responsibilities set out above for the underlying investors you are responsible for and may be required to enter into contractual arrangements with us and KB Custodial regarding your compliance with the requirements of tax legislation. You will be liable to pay KB Custodial an amount equal to any losses liabilities, costs or expenses incurred by KB Custodial, the Manager and the Trustee as a result of any breach (in relation to underlying investors that you are responsible for) of the Maximum Investor Interests requirement or the Minimum Number of Investors requirement under the Income Tax Act 2007 including the losses, liabilities costs or expenses arising from any Fund losing PIE status. Other Tax legislation and rates of tax are subject to change. The impact of taxation may vary depending on your individual circumstances. It is important to seek professional taxation advice before you invest or deal with your investment in any way as the taxation treatment of your investment will be specific to your circumstances and to the nature of your investment. None of the Trustee or its nominee companies, the Manager, the Promoters, the Investment Manager, Kiwibank, Kiwibank Investment Management, KB Custodial, New Zealand Post Limited or any other member of the New Zealand Post Group, any of their respective related companies or directors, or any other person takes responsibility for your taxation liability. If you receive a request from us or KB Custodial to provide information to enable the Manager to determine whether any Fund continues to meet the PIE eligibility requirements you must supply that information within 30 days of the request. The Manager has a wide range of discretions to operate each Fund as a PIE including: discretions relating to the calculation of tax; adjusting distributions to you or redeeming your Units to meet your liability for tax; and taking all steps necessary to ensure that the Fund meets the PIE eligibility requirements including: rejecting applications for Units and transfers of Units to ensure the Maximum Investor Interests requirement under the Income Tax Act 2007 is not exceeded; or if your unit holding exceeds the Maximum Investor Interests requirement, selling, redeeming or repurchasing Units. You will be given notice and an opportunity to remedy a breach of the Maximum Investor Interests requirement (provided that there is time to remedy the breach under the relevant tax legislation). The proceeds from any sale, redemption or repurchase carried out by the Manager to remedy such a breach (less any costs and expenses incurred by the Manager in respect of the same) will be paid to you, and neither the Manager nor the Trustee shall be liable for any loss you may incur under or in connection with any such sale, redemption or repurchase. A Fund that holds foreign shares (that is, shares in any company not resident in New Zealand) are subject to the foreign investment fund rules and the FDR (fair dividend rate) method is used in respect of such shares, except for shares in certain Australian resident companies listed on an approved ASX index (taxed under ordinary New Zealand tax rules) and certain non ordinary shares (which are instead subject to the CV (Comparative Value) method). Under the FDR method, a Fund that holds foreign shares is deemed to derive taxable income equal to 5% of the market value of the shares, calculated on a daily basis and weighted over the income year. Dividends and gains received on such shares are not taxable and losses incurred on the disposal of such shares are not deductible when the FDR method is applied. Where the CV method is applied (see above) changes in the value of an investment over the income year (including those due to foreign exchange movements) are included in the Fund s income, together with amounts received during the income year from holding or disposing of the investment. The FDR foreign currency hedges tax calculation method has been introduced for foreign currency hedges relating to shares which are taxed under the FDR method or are listed on the ASX. The application of this calculation method is optional. Under this calculation a form of the FDR method is applied to the foreign currency hedges instead of the financial arrangement rules. The adoption of the foreign currency hedges tax calculation method is currently being considered and may or may not be implemented in the future on a Fund by Fund basis, as appropriate. The current treatment of foreign currency hedges will continue where FDR foreign currency hedges method cannot be applied or is not adopted. Switches and redemptions If you switch from one Fund to another Fund or redeem Units, the tax liability at your PIR on income attributed to you up to the switch or redemption will need to be satisfied, either by cancellation of Units or deductions from distributions, if any. If you hold your Units through KB Custodial on capital account (i.e., if you would not be taxed on a transfer of the Units), then the entire amount of any Unit redemption proceeds will not be taxable for you. If you hold your Units through KB Custodial on revenue account (i.e., if you would be taxed on a transfer of the Units), then you should obtain professional taxation advice as to whether redemption proceeds will be taxable for you. Transfers As the Funds are PIEs, applications for the transfer of Units may be treated as a cancellation of the transferor s Units and the issue of new Units to the transferee (in which case the entry and exit fees set out on page 16 may be payable). Also, tax at the transferor s PIR may be payable on income attributed to the transferor for the period up to the date of cancellation of the Units. If a transfer of Units does occur there may be tax consequences for the transferor, depending on the transferor s tax position. 14

16 Distributions of dividend income It is the current policy of the Manager not to distribute dividend income received. Accordingly, income will be reflected in the Unit price. Should a distribution be made, you will be given the choice of having your distributions reinvested in Units in the same Fund, or direct credited to a nominated bank account. The re-investment option contains all the terms required by the Securities Act (Dividend Reinvestment) Exemption Notice 1998 (and following the expiry of that notice, the terms required by the FMCA and the Financial Markets Conduct Regulations 2014). Retentions If the Manager does choose to distribute, it may retain net income of a Fund for the half-year rather than distributing all income therefore affecting the distribution payable to you. Redemptions and repurchases For each Fund in normal circumstances repurchase or redemption of your Units will be made within 10 business days of the Manager receiving the Repayment Request you provide to us. The Manager may in certain circumstances, suspend the obligation to repurchase, or cause the redemption of, Units by issuing a Repayment Suspension Notice (for instance, where the Manager believes, in good faith, that it is not practicable or would be prejudicial to the interests of Unit Holders for the Trustee to realise Assets or borrow to permit redemptions this could be because of market or Asset conditions or other circumstances). Any such suspension shall continue until cancelled by the Manager. As the registered holder of your Units KB Custodial will vote or abstain from voting in such manner as it considers appropriate in its discretion on any such resolution. AMP Investment Management (N.Z.) Limited is the person legally liable to pay you your returns (subject to the terms of the Trust Deed). Any amount payable to you on repurchase or redemption will be credited (after any permitted deductions) to your Nominated Account. What are my risks? The principal risks of the money paid by subscribers for Units not being recovered in full, and of subscribers not receiving the returns described under the heading What returns will I get? on page 17. The performance of the Funds can be influenced by many general factors impacting on markets in which they invest, including inflation, interest and growth rates, changes in government policy changes in tax and other laws, political events, changes in investor sentiment, performance of the underlying businesses or assets and currency fluctuation. The Assets of the Funds are market linked, and therefore are susceptible to general market fluctuations and individual security price fluctuations. The Funds each have a different level and variety of risks, due to the different features and objectives of each Fund. See the description of each Fund and its objectives contained on pages 6 to 11 of this Investment Statement. As asset values can fluctuate, a Fund s unit price may not reflect changes that have occurred in Asset values since the most recent valuation. Due to the market linked nature of the Funds it is possible that you will not recover the amount paid or the returns described above. It is also reasonably foreseeable (particularly where an investment is terminated in the short term) that on termination it is possible that you will receive less than the amount paid for the Units. This could occur if the Unit value decreases between the time of subscription and the time of redemption or if the returns on the investment are insufficient to meet fees payable in relation to the investment. You should not be required to pay any further money in respect of an investment, other than as disclosed in this Investment Statement. For example, you are liable to meet any tax liability attributable to you which exceeds the value of your investment in the Fund, as described under the heading Personal liability and consequences of insolvency below. Liquidity risk The Funds allow redemption of Units subject to certain procedural requirements including the right under the Trust Deed to delay and/or suspend redemptions. During normal operational circumstances redemptions can be met out of cash held by the relevant Fund. However if the value of redemptions significantly outweighs the value of subscriptions the Fund may not be able to meet Repayment Requests out of cash reserves and will be reliant on selling or redeeming (whichever is relevant) some of the Fund s Assets. These Fund Assets may not be immediately realisable. For example if a Fund s Assets consist of units in a property holding unit trust the Fund s ability to redeem those units will be reliant on the time it takes the fund it is investing in to action the redemption and potentially sell assets to generate cash to meet the redemption request. Similarly a Fund which invests in another managed fund may not be able to realise its investment in that fund immediately if the fund has been closed or is being wound up. In volatile market conditions a Fund s Assets may not necessarily be as easily realisable as they may have been at a previous point in time, or may only be able to be realised at a lower value than might be expected in normal market conditions. This could have a negative effect on the value of a Fund s Assets and its performance and in turn may affect the value of your investment and the returns you receive from the Fund. Derivative and counterparty risk Financial instruments known as derivatives may be used for the purposes of managing risks (particularly market and currency risk) and for investment purposes. A derivative is a contract with a return that depends on, or derives from, one or more underlying assets or reference items. The most common underlying assets or reference items include shares, bonds, currencies, cash, interest rates, events, entities and market indices. Using derivatives involves risks including: the potential for large gains or losses exaggerating the effect of any increase or decrease in the value of the underlying assets or reference items; and the other party to the derivatives contract not meeting its obligations, or there being a delay in those obligations being met (such failures or delays could occur for a number of reasons, including the counterparty being in financial difficulty or subject to some insolvency event (e.g., receivership, liquidation, etc). 15

17 Some derivatives are traded on an exchange and settled through a central counterparty settlement system. The Fund would be exposed to risks as those set out above in respect of the operator of the settlement system. Operational risk The Funds may be exposed to operational risks that result from external events or failure of internal processes, people and systems. These risks include technology risk (including business systems failure), human error or failure, fraud, non-compliance with legal and regulatory obligations, counterparty performance under outsourcing arrangements, legal risk, data integrity risk, security risk and external events (including pandemics). Currency risk Currency risk may affect Funds which invest in offshore assets and which are not hedged or only partially hedged. Currency risk is the risk of exchange rate fluctuations between the New Zealand dollar (the currency in which the Funds are valued) and foreign currencies. As some of the Assets of the Funds are invested offshore returns can be affected by movements between the New Zealand dollar and other currencies. Regulatory risk Like any managed funds investment, investments made through the Funds are exposed to the risk of future changes to tax or other legislation which could affect the operation of the Funds, or the returns available from them. Risk of loss of PIE status The eligibility requirements to maintain PIE status pose a risk. Although the Manager has mechanisms available to manage compliance with the PIE eligibility requirements, there remains a risk that the Funds could lose PIE status if there is a breach of those requirements and the Manager does not become aware of the breach in time to correct it. This risk, if manifested, may have an adverse effect on the tax position of the relevant Fund and/or you. In particular, distributions made by the Fund to you would be taxable for you (subject to exceptions for returns of subscription amounts) if the Fund lost PIE status. Wrong PIR risk If an investor or underlying investor has provided a PIR that is lower than the correct PIR that investor will be liable for any tax shortfall (and any interest and penalties) and must file a tax return. Investors or underlying investors who provide a PIR that is higher than the correct PIR, or who do not provide a PIR and are therefore subject to the default rate of 28%, will not be able to claim back the excess tax paid. Personal liability and consequences of insolvency You are not liable for any further payment as a result of a Fund or the Manager becoming insolvent. You are liable to meet any tax liability attributable to you which exceeds the value of your investment in a Fund (in which case you indemnify the Trustee for the difference between the value of your Units and that tax liability). If you are investing through us as a proxy you will be liable to pay KB Custodial an amount equal to any losses, liabilities, costs or expenses incurred by KB Custodial, the Manager, the Trustee and any Fund as a result of any breach in relation to your investment of the Maximum Investor Interests requirement or the Minimum Number of Investors requirement under the Income Tax Act 2007, including the losses, liabilities, costs or expenses arising from the Fund losing PIE status. Creditors of each Fund (including the Manager, Promoter and Trustee for their fees and expenses) will rank ahead of your claim in the event of the Fund being wound up. Your claim against a particular Fund will rank equally among the claims of all investors in the Fund in proportion to the number of Units held. If any of these risks eventuate the relevant Fund could suffer loss as a result. Anti-money laundering, countering financing of terrorism and sanctions Kiwibank Investment Management Limited, the Manager and the other parties involved in providing this product to you are subject to anti-money laundering, countering financing of terrorism and sanctions laws ( AML Laws ) in New Zealand and elsewhere. The AML Laws require a number of things including: verification of your identity and address before Units in the Funds are issued to you (and at certain times after that); monitoring of your transactions; reporting of any suspicious transactions to the Police; and the keeping of identity, address and transaction records about you. The AML Laws also prohibit a number of things, including issuing Units in the Funds to you until your identity and address have been verified. The AML Laws may also mean transactions you have requested are refused or delayed or the operation of your investment account is suspended. To assist in compliance with AML Laws, you are required to make a number of declarations when completing the application form to purchase Units in the Funds. Can the investment be altered? You are able to change the amount of your investment at any time, subject to the minimum additional lump sum investment required of $500 per Fund. You can also elect to make a regular contribution when you invest through us, or a minimum $50 per fortnight per Fund. You should contact us if you wish to switch your investment in one Fund to another Fund(s). The Manager may refuse a request to switch investments at its absolute discretion. The minimum number of Units which may be switched between Funds is 500 but you must retain a minimum holding of 500 Units in the Fund from which the switch is made. To effect a switch, Units in the existing Fund will be sold at the applicable Repayment Price (see the How do I cash in my investment? section below for information on calculation of the Repayment Price) and Units in the other Fund will be bought at the applicable Issue Price (see the How much do I pay? section on page 15 for information on calculation of the Issue price). Entry and 16

18 exit fees are payable when selling Units in one Fund and buying Units in another (see the What are the charges? section on page 16). The provisions in the Trust Deed applying to redemption or repurchase of Units will apply to switches. The terms and conditions of your investment may be altered by amendment to the current registered prospectus for each of the Funds, this Investment Statement, Kiwibank s General Terms and Conditions, or KB Custodial s Terms and Conditions. The terms and conditions of the Trust Deed itself may only be altered with the approval of the Trustee and the Manager and in accordance with the Trust Deed. A summary of all Trust Deed amendments made since the date of the last annual report will be sent to you with (or as part of) the annual report for the Funds. We may direct KB Custodial to transfer the investments in any or all of the Funds to any other investment. You will receive at least 60 days written notice of any such transfer and have the opportunity to withdraw all of your investment in the relevant Fund(s) within that notice period. The Manager has the power to suspend redemptions and repurchases from time to time. See the How do I cash in my investment section below. If that occurs, the investment shall not be transferred or withdrawn until the Manager recommences redemptions and repurchases. How do I cash in my investment? Withdrawals You may at any time request the repayment or redemption of some or all of your Units. To make a repayment or redemption contact us at the number below or send in a completed repayment or redemption form to the address listed below. Withdrawal forms can also be downloaded from the Kiwibank website at withdrawing-funds-form.pdf Kiwibank Investment Management Limited Level 12, New Zealand Post House 7 Waterloo Quay Private Bag Wellington 5045 Telephone: In normal circumstances payment will be made within 10 business days of when we receive a Repayment Request. Under the Trust Deed, payment is required to be made within 60 days of the date on which your Repayment Request is received by us. The Manager may satisfy Repayment Requests in respect of the Funds by the transfer or in specie distribution* of Assets (rather than cash) if the Manager obtains the agreement of KB Custodial. You may choose either repurchase or redemption of your Units, and in normal circumstances the Manager will give effect to your choice, however the Manager is not bound to do so. The Manager may refuse to repurchase, or cause the Trustee to refuse to redeem, your Units, if the Repayment Request is in respect of less than 500 Units unless all your Units are to be redeemed or repurchased. The Manager may also require you to redeem or repurchase all of your remaining Units in the relevant fund if the total number of Units held by you after the redemption or repurchase would be less than 500. Units are redeemed or repurchased at the then current Repayment Price. The Repayment Price will be calculated by the Manager as at the date the Manager receives your repurchase or redemption request through us, unless the Trustee gives prior approval for the Repayment Price to be the last price calculated as at a date before the Manager receives your repurchase or redemption request. An exit fee is payable (see page 16). If an investment would threaten or will cause a Fund to be ineligible as a PIE, the Manager has the discretion to redeem or repurchase the number of Units giving rise to the breach. If the Maximum Investor Interests requirement is exceeded, the number of Units giving rise to the breach may be sold, redeemed or repurchased. If the breach relates to your investment you will be given notice and an opportunity to remedy the breach (provided that there is time to remedy the breach under the relevant tax legislation). The proceeds from such sale, redemption or repurchase carried out to remedy such a breach will be paid to you, less any costs and expenses incurred by us and tax payable in respect of the same and none of the Manager, the Investment Manager, Kiwibank, Kiwibank Investment Management, KB Custodial, New Zealand Post Limited or any other member of the New Zealand Post Group or the Trustee or any of its nominee companies shall be liable for any loss that you may incur under or in connection with any such sale, redemption or repurchase. If an asset is distributed in specie it will be distributed in its actual form, rather than first being transferred into cash or another form (for example, a share distributed in specie would be transferred to a Unit holder rather than sold and the cash proceeds paid to the Unit holder). Any distributions paid or bonus units credited to the Unit Holder will be deducted from this price also to the extent necessary to ensure you get no benefit from the Fund. For further details, please see the current registered prospectus or the Trust Deed. Suspending withdrawals The Manager may in certain circumstances, suspend the obligation to repurchase, or cause the redemption of, Units by issuing a Repayment Suspension Notice. Please refer to page 21 for more information. Transfers Subject to the Manager s and KB Custodial s discretion, you are entitled to sell your interest in a Fund to another person (subject to the Manager s pre-emptive right to purchase those Units as set out in the Trust Deed). However, the Manager does not believe that there is an established market for such sales. KB Custodial is not required to comply with any request to transfer your Units to any person and may instead request the Manager to redeem or repurchase the Units, and pay the proceeds of redemption or repurchase (after any permitted deductions) to your Nominated Account as soon as practicable after receiving them. In addition, if you apply to transfer your Units the Manager may treat the transfer as a cancellation of your Units and the issue of new Units to the transferee (in which case the entry and exit fees set out on page 16 will be payable). 17

19 The transfer of a Unit may be refused if certain administrative requirements imposed by the Trust Deed and specified in the current registered prospectus for the relevant Fund are not complied with or the transfer would result in the transferor or transferee holding less than 500 Units in the Fund. Tax on redemptions and repurchases Where Units are redeemed or repurchased, the tax liability (if any) on income attributed to you up to the redemption or repurchase date will need to be satisfied either by KB Custodial making adjustments to the Units held on your behalf (by requesting the Manager to repurchase or redeem Units) or the distributions (if any) made to you and using the proceeds to meet your tax liability or requiring you to make a payment to reflect the tax liability on income attributed to you. Generally this will occur by KB Custodial making adjustments to the Units held on your behalf by repurchasing or redeeming Units. Who do I contact with inquiries about my investment? Inquiries should be directed to: Kiwibank Investment Management Limited Level 12, New Zealand Post House 7 Waterloo Quay Private Bag Wellington 5045 Telephone: Fax: (04) wealthadmin@kiwibank.co.nz or AMP Capital Investors (New Zealand) Limited Ground Floor, PWC Tower The Terrace PO Box 3764 Wellington 6140 Telephone: Fax: (04) ampcapital@ampcapital.co.nz Is there anyone to whom I can complain if I have problems with the investment? Any complaints or problems with the investment should in the first instance be directed to: Attention: Kiwibank Customer Complaints Kiwibank Investment Management Limited Level 12, New Zealand Post House 7 Waterloo Quay Private Bag Wellington 5045 Telephone: Fax: (04) or wealthadmin@kiwibank.co.nz AMP Capital Investors (New Zealand) Limited Ground Floor, PWC Tower The Terrace PO Box 3764 Wellington 6140 Telephone: Fax: (04) ampcapital@ampcapital.co.nz or If you are not satisfied with the outcome of your complaint, you can contact: The Manager, Corporate Trusts The New Zealand Guardian Trust Company Limited Level 2, Dimension Data House Customhouse Quay PO Box 913 Wellington 6140 New Zealand Telephone: If you are still not satisfied with the outcome, you may make a complaint to the Banking Ombudsman at the following address (if your complaint is about Kiwibank, Kiwibank Investment Management or KB Custodial): Office of the Banking Ombudsman Level 5, Huddart Parker Building 1, Post Office Square Wellington 6011 Telephone: or +64 (4) In addition, the Promoter and Manager are members of Financial Services Complaints Limited, a dispute resolution scheme approved under the Financial Service Providers (Registration and Dispute Resolution) Act Under that scheme, if you have any complaints or problems with the Promoter or the Manager, you should first try to resolve these with the Promoter or the Manager (as applicable). The contact for complaints for both the Promoter and Manager is AMP Capital s Executive Legal Counsel, who can be contacted at AMP Capital s address above. If your complaint about the Manager or the Promoter cannot be resolved with AMP Capital, you may direct your complaint to: Financial Services Complaints Limited 4th Floor 101 Lambton Quay PO Box 5967 Wellington Telephone: or (04) Fax: (04)

20 What other information can I obtain about this investment? Further information about the Funds is contained in the current registered prospectus relating to the Funds, the Financial Statements of each Fund and also the Trust Deed and amendments to the Trust Deed. A copy of the current registered prospectus, Financial Statements and Trust Deed for the Funds can be obtained upon request free of charge from Kiwibank Investment Management, Level 12, New Zealand Post House, 7 Waterloo Quay, Private Bag 39888, Wellington A copy of the prospectus and Financial Statements and other documents relating to the Issuer are also filed on the public register at the Companies Office of the Ministry of Business, Innovation and Employment and are available for public inspection either on the Manager s file on the Companies Office s website at companies or (on payment of the relevant fee) by telephoning the Companies Office during normal business hours on The following information in relation to any Fund in which you invest may also be requested in writing, free of charge, from us: An annual statement for taxation purposes. Further copies of the Investment Statement. A written statement of your unit holding as detailed in the Unit Holder Register. A copy of the AMP Capital Investment Funds annual report, which will include audited financial statements for the Funds. A copy of the Trust Deed or prospectus and any amendment to it. You can also obtain a copy of the Unit Holder Register from the Manager subject to payment of a fee. Within 15 business days of the end of each quarter, we will provide you with a Quarterly Statement of Account detailing the value of your investment, and any of your transactions that have occurred during the quarter. Once every six months you will receive either: > a statement of your unitholding; or > a notice stating that you have the right to receive from us, without payment of any fee, a written confirmation of your Unit holding if you request one. The notice will also provide you with details on how you may obtain the written confirmation by electronic means. This Investment Statement and Kiwibank s General Terms and Conditions can be viewed on Kiwibank s website at www. kiwibank.co.nz/about-us/legal-docs. KB Custodial s Terms and Conditions (which govern the basis on which KB Custodial holds Units on your behalf) are set out in the application form attached to this Investment Statement. None of the Manager, AMP Capital, The New Zealand Guardian Trust Company Limited, the Trustee s nominee company, Kiwibank, Kiwibank Investment Management, KB Custodial, New Zealand Post Limited and other members of the AMP Group or other members of the New Zealand Post Group, their directors, officers, agents, or nominees, nor any other person guarantees the value of the Units, the repayment of the Units, the payment of income or the performance of the Funds. How will your information be held and used? We will comply with all privacy laws and codes of practice, including the Privacy Act 1993 (which governs the rights of individuals in relation to personal information). When you invest in a Fund, and during the period of your investment, your personal information may be kept on file by the Manager, AMP Capital, the Trustee, Kiwibank, Kiwibank Investment Management, KB Custodial, New Zealand Post Limited and other members of the New Zealand Post Group and the person or organisation that arranged this investment for you. This information may be used and disclosed for the purposes of administering your investment in the Fund(s), including to enable Kiwibank Investment Management, KB Custodial and Kiwibank to perform their respective functions, provide or offer services to you, and for any other purpose permitted by Kiwibank s General Terms and Conditions. Your personal information may be disclosed to AMP Capital, other members of the AMP Group or other members of the New Zealand Post Group. The Manager and Kiwibank Investment Management may disclose information from time to time relating to your investments to: agents involved in the provision of administration or custodial services to the Funds(s), Kiwibank Investment Management or KB Custodial (which agents may themselves use such information in the performance of their functions) or for regulatory purposes; any other person involved in arranging any other investment to which your investment in the Fund(s) may be transferred as described above in the section entitled Can the investment be altered on page 22; and any other person permitted by Kiwibank s General Terms and Conditions. During normal working hours you are entitled, free of charge, to see any personal information the Manager, AMP Capital, the Trustee, Kiwibank Investment Management, KB Custodial or Kiwibank hold about you. If you believe that any of the details are incorrect, you may ask for a correction to be made. If for any reason we are unable to make the correction requested, details of your request will be permanently attached to your personal information. 19