GLOBAL PARTNERS. Société d'investissement à capital variable Open-ended investment company under Luxembourg law UCITS.

Transcription

1 VISA 2015/ PC L'apposition du visa ne peut en aucun cas servir d'argument de publicité Luxembourg, le Commission de Surveillance du Secteur Financier P R O S P E C T U S GLOBAL PARTNERS Société d'investissement à capital variable Open-ended investment company under Luxembourg law UCITS Issue Prospectus 11 September 2015 Subscription is permitted solely on the basis of the prospectus, accompanied by the application form, the latest annual report and the latest interim report if the latter is of more recent date than the annual report. In the event of discrepancies between the English version and the other language versions of the prospectus, the English version will prevail. 1

2 CONTENT IMPORTANT INFORMATION GENERAL INFORMATION Board of Directors Registered Office Management Company Central Administration Custodian and Paying Agent Auditor Financial Services providers Capital of the Sicav: THE SICAV MANAGEMENT COMPANY : KBC ASSET MANAGEMENT S.A Board of Directors of the Management Company Dirigeants of the Management Company Registered Office of the Management Company Date of Incorporation of the Management Company Subscribed and paid in capital of the Management Company List of the funds and the sicav for which the management company has been appointed Appointment of the Management Company by the Sicav Identity of the auditor of the management company or name of the recognised firm of auditors Subscribed capital of the management company stating the paid-up element: CUSTODIAN, PAYING AGENT AND FINANCIAL SERVICES PROVIDERS CENTRAL ADMINISTRATION INVESTMENT OBJECTIVES OF THE SUB-FUNDS

3 6.1. Investment policy of the capital-protected sub-funds Investment objective of the sub-funds without capital protection INVESTMENT RESTRICTIONS Eligible instruments Techniques and instruments used Spreading of risks Limits on participating interest Exceptions to the investment policy Prohibitions Characteristics of the bonds and debt instruments RISK CONTROL SHARES ISSUE, REDEMPTIONS AND EXCHANGE OF SHARES General provisions Issue of shares Redemption of shares Switch of shares VALUATION OF THE NET ASSET VALUE OF SHARES Assets of the Sicav Liabilities of the Sicav Valuation of the net asset value TEMPORARY SUSPENSION OF THE CALCULATION OF THE NET ASSET VALUE OF SHARES INFORMATION FOR SHAREHOLDERS DISTRIBUTION POLICY

4 15. TAXATION OF THE SICAV AND ITS SHAREHOLDERS Taxation of the Sicav Taxation of the shareholders FEES, CHARGES AND EXPENSES Distribution expenses Other expenses Ongoing charges LIQUIDATION OF THE SICAV OR ONE OF ITS SUB-FUNDS Liquidation of the Sicav Liquidation of sub-funds GENERAL MEETINGS OF THE SHAREHOLDERS FEE-SHARING AGREEMENTS AND REBATES DOCUMENTS AVAILABLE TO THE PUBLIC LIST OF THE SUB-FUNDS MARKETED BY THE SICAV Sub-funds of the Sicav that have been launched PL21.2. Sub-funds of the Sicav that have not been launched APPENDIX 1 DETAILED DESCRIPTION OF THE SUB-FUND I. Best of Maximum capitalization sub-funds II. Best of Cap Cliquet sub-funds III. Best of variable Participation sub-funds IV. Tree sub-funds V. Fix upside coupon sub-funds VI. Fix upside click sub-funds VII. Jumpstart sub-funds VIII. Best Timing sub-funds 306 4

5 IX. Digital Reverse Cliquet Structure sub-funds X " Asian Himalja " sub-funds 309 XI. Index Jumper sub-funds XII " Coupnator " sub-funds..334 XIII. Fix Upside Memory Click sub-funds XIV. Coupon Driver sub-funds XV. Escalator sub-funds XVI. Airbag sub-funds XVII CPPI sub-funds XVIII. Point Capped sub-funds XIX. Duo Coupon sub-funds XX. Participation Up- Participation Down sub-funds No person is authorised to give any information that is not contained in the present prospectus or in the documents referred to herein that are available for inspection by the public. 5

6 Important information This prospectus is published in connection with a share offering of the société d investissement à capital variable GLOBAL PARTNERS, referred to hereinafter as the Sicav. The Fund will publish in addition to this Prospectus a Key Investor Information Document (a KIID ) for each Share Class of each Sub-Fund which contains the information required by the Luxembourg Law. GLOBAL PARTNERS is an open-ended investment company under Luxembourg law subject to Part I of the Law of 17 December 2010 on undertakings for collective investment (referred to hereinafter as the Law ). The Sicav s shares are divided up into different categories, each corresponding to a separate pool of assets (the subfunds). The Sicav may issue shares in capital-protected sub-funds, as well as in sub-funds that adhere to an investment policy that does not afford capital protection. In general, the prospectus may not be used for the purposes of an offer or the solicitation of sales in any jurisdiction or under any circumstances where such offer or solicitation is not permitted. Prospective investors who receive a copy of the prospectus or the application form in any jurisdiction other than the Grand Duchy of Luxembourg may not regard these documents as an invitation to buy or subscribe to shares unless such invitations may legally be made in the jurisdiction concerned without registration or other formalities having to be fulfilled, or unless this person complies with the legislation in force in the jurisdiction concerned, obtains all government or other authorisation required and, in the event, fulfils all the requisite formalities there. None of the Shares have been, nor will be, registered under the United States Securities Act of 1933 ( the 1933Act ) and, none of the shares may be directly or indirectly offered or sold, transferred, delivered in the United States of America, or any of its territories or possessions or areas subject to its juridiction, or to or for ther benefit of a US Person. Neither the Company nor any sub-fund will be registered unde rthe United States Investment Company Act of None of the Shares may be directly or indirectly offered or sold, transferred, delivered to or for the benefit of a person if such transaction will establish for the Company a US Reportable Account as this term is defined in the US legislation known as FATCA (Foreign Account Tax Compliance Act). The Board of Directors of the Sicav has taken every precaution that is reasonably necessary or expedient to ensure that, on the date of the prospectus, its contents are accurate and precise with regard to all important points it covers. The directors all accept responsibility accordingly. Prospective investors should gather information themselves and consult their bank, broker and legal, accounting and tax advisers in order to be fully aware of any legal or fiscal consequences or consequences of currency restrictions or exchange controls that might ensue on subscription to, or the holding, redemption or transfer of shares under the laws in force in their countries of residence, domicile or establishment. No person is authorised to give any information that is not contained in the present prospectus or in the documents referred to herein that are available for inspection by the public. Neither the delivery of the present prospectus, nor the offering, issue or sale of shares in the Sicav constitute a representation that the information contained in the present prospectus will be accurate at any time subsequent to the date of the prospectus. Information contained in the prospectus is deemed to be correct to the date of publication: it may be updated when necessary to take account of major changes that take place after its publication. Prospective investors are therefore advised to ask the Sicav whether it has published another prospectus subsequently. In Luxembourg, copies of the prospectus may be obtained under the conditions set out above from: KREDIETRUST Luxembourg 11 rue Aldringen, L-1118 Luxembourg. 6

7 1.General Information 1.1 Board of Directors President: Mr Wouter VANDEN EYNDE Managing Director, KBC Asset Management NV Havenlaan 2, B-1080 Brussels Directors: Mr. Lazlo BELGRADO Head of Specialized Investment Management, KBC Asset Management SA 5, Place de la Gare, L 1616 Luxembourg Mr Karel DE CUYPER Mr. Jos LENAERTS Dirigeant of KBC Asset Management S.A., 5, Place de la Gare, L-1616 Luxembourg Senior Legal Advisor, 5, place de la Gare, L-1616 Luxembourg 1.2 Registered Office 11 rue Aldringen, L-1118 Luxembourg 1.3 Management Company KBC Asset Management S.A., 5, Place de la Gare, L-1616 Luxembourg 1.4 Central Administration Kredietrust Luxembourg S.A., 11 rue Aldringen, L-2960 Luxembourg 1.5 Custodian and Paying Agent KBL European Private Bankers S.A., 43 boulevard Royal, L Luxembourg 1.6 Auditor Deloitte Audit S.a.r.l., 560, rue de Neudorf, L-2220 Luxembourg 1.7 Financial Services providers In Luxembourg: KBL European Private Bankers S.A., 43 boulevard Royal, L-2955 Luxembourg 1.8 Capital of the Sicav: The share capital is at all times equal to the net asset value. The share capital may not be less than EUR

8 2. The Sicav The Sicav is an open-ended investment company (Sicav) under Luxembourg law and was established on 13 July 2007 for an unlimited period. Global Partners is a Sicav with various sub-funds that has opted for investments complying with the conditions of Directive 2009/65/CE and which, as far as its operations and investments are concerned, is governed by the Law of 17 December 2010 relating to undertakings for collective investment Its registered office is located in Luxembourg at 11 rue Aldringen. The Sicav is entered in the Luxembourg Registre de Commerce et des Sociétés (trade register) under number B The Sicav s central administration is based in Luxembourg. The date of incorporration is 13 July The articles of incorporation were published in the Mémorial, Recueil Spécial des Sociétés et Associations (the Mémorial ), the official gazette of the Grand Duchy of Luxembourg, on 6 August 2007 and filed with the Chancery of the District Court of and in Luxembourg together with the legal notice concerning the issue and the sale of its shares. These documents are available for inspection at the Chancery of the District Court of and in Luxembourg, where copies may be obtained. The initial capital of the Sicav comes to EUR. The minimum capital of the Sicav comes to EUR, and must be achieved within six months of the establishment of the Sicav. The Sicav is an open-ended investment company that issues and redeems its shares at regular intervals in accordance with the terms and conditions set out in the section of the present prospectus entitled Issue, Redemption and Exchange of Shares. Variations in capital occur ipso jure and are not subject to the requirements of publication and registration in the company register prescribed for capital increases or decreases of sociétés anonymes (type of limited company). By way of derogation from the provisions of the amended Law of 10 August 1915 on Commercial Companies, the reimbursement of shareholders consequent on a reduction in the Sicav s share capital is not subject to any restrictions. Under the articles of incorporation, shares may be issued, as the Board of Directors sees fit, in the various sub-funds into which the company s assets are divided. A separate pool of assets is established for each sub-fund and invested according to the investment objective of the sub-fund in question. The Sicav is consequently designed to be an umbrella company, allowing investors to choose between several investment objectives and to invest accordingly in one or more sub-funds into which the company s assets are divided. Each of the sub-funds constitutes a separate entity, in particular for the purpose of spreading risk. The Board of Directors may decide at any time to have the Sicav issue shares in other sub-funds with investment objectives that are identical to or different from those of the existing sub-funds. The Sicav s share capital will at any time equal the aggregated net asset value of all the sub-funds combined. The Sicav s reference currency is the EUR. Each of the sub-funds shares may be issued as either a capitalisation (i.e. accumulation) share or a distribution share, depending on the shareholder s preference, unless the Board of Directors decides otherwise for certain subfunds, in which case this will be specified in the present prospectus. The rights attaching to the distribution and the capitalisation shares are set out below under 14. Shareholders may request that the shares they hold in one sub-fund be exchanged for shares in another, according to the terms and conditions set out below under Shareholders may request the Sicav to redeem their shares according to the terms and conditions set out below under In dealings amongst shareholders and in dealings between shareholders and third parties, each sub-fund is treated as a separate entity, with its own assets, revenues, capital gains and losses, and is to be deemed solely liable for its own commitments. The Board of Directors is responsible for the administration and management of the Sicav, the controlling of its transactions as well as the determination and implementation of the investment policy. In accordance with the Law, the Board of Directors may appoint a management company. 8

9 In accordance with Chapter 15 of the Law, KBC Asset Management SA, 5, place de la Gare, L-1616 Luxembourg has been appointed by the Sicav, as management company of the Sicav. 3. Management Company : KBC Asset Management S.A Board of Directors of the Management Company Chairman Mr Dirk MAMPAEY Chairman of the Executive Committee, KBC Asset Management NV., Havenlaan 2, B-1080 Brussels Directors: Mr. Jürgen VERSCHAEVE Managing Directore, KBC Asset Management N.V., Havenlaan 2, B-1080 Brussels Mr Ivo BAUWENS General Manager, KBC GROUP RE S.A. 5, Place de la Gare, L-1616 Luxembourg 3.2.Conducting Officers of the Management Company Mr Lazlo BELGRADO Head of Specialized Investment Management, KBC Asset Management SA., 5 place de la Gare, L-1616 Luxembourg Mr Karel DE CUYPER Head of KBC Asset Management S.A., 5, place de la Gare, L-1616 Luxembourg 3.3. Registered Office of the Management Company 5, Place de la Gare, L-1616 Luxembourg 3.4. Date of Incorporation of the Management Company The Management Company has been incorporated under the name of KBC Institutionals Gestion SA on December 1, The name of the Management Company has been changed to KBC Asset Management S.A. on February 10, The Management Company has been granted authorisation in accordance with Chapter 15 of the Law of December 17, Subscribed and paid in capital of the Management Company The subscribed and paid in capital of the Management Company amounts to EUR List of the funds and the sicav for which the management company has been appointed Sicav: KBC Bonds, KBC Renta, Access Fund, KBC Interest Fund, KBC Institutional Interest Fund, Global Partners, KBC Select Investors, KBC Flexible, Contribute Partners and Managed Investors Mutual Fund (Fonds commun de placement): KBC Institutionals, KBC Life Invest Fund, KBC Life Privileged Portfolio Fund, KBC Life Institutional Fund 9

10 3.7. Appointment of the Management Company by the Sicav Appointment of the Management Company The Sicav has appointed KBC Asset Management S.A. as management company in accordance with Chapter 15 of the Law on the basis of an agreement entered into force on May 1, Management Activities General The objective of the Management Company is to manage undertakings for collective investment in accordance with the Law. Its management activity covers the management, administration and marketing of undertakings of collective investment such as the Sicav Functions performed for the Sicav - Management of the Portfolio - Central Administration. The Management Company delegates the central administration to Kredietrust Luxembourg (voir 5 Central Administration) - Distribution 3.8. Identity of the auditor of the management company or name of the recognised firm of auditors Ernst & Young, 7 rue Gabriel Lippman, Parc d Activité Syrdall 2, L-5365 Munsbach, Luxembourg 3.9. Subscribed capital of the management company stating the paid-up element: The issued share capital amounts to EUR The share capital is fully paid up. 4. Custodian, Paying Agent and Financial Services Providers KBL European Private Bankers is the custodian of the assets of the Sicav. In general and not subject to any restriction whatsoever, the custodian performs the usual tasks with regard to deposits of cash and the safe custody of securities. It performs all financial operations and bank services whatsoever on the instructions of the Sicav. By Law, the custodian must also: - ensure that the sale, issue, redemption and cancellation of shares effected by or on behalf of the Sicav are carried out in accordance with the law or the articles of incorporation of the Sicav, - ensure that, in transactions involving the assets of the Sicav, the consideration for the transactions is remitted to it within the usual time limits, - ensure that the income of the Sicav is appropriated in accordance with the articles of incorporation. The custodian may, on its own responsibility, entrust the physical custody of the securities, particularly those traded abroad or listed on a foreign stock exchange or accepted by clearing institutions for their transactions, to such institutions or to one or more correspondent banks. In consideration of its services as custodian, the bank will charge the usual banking fees for the deposit of assets and the safe custody of securities. It acts as custodian under the terms of an agreement that may be terminated by either 10

11 party subject to three months notice, on the understanding that the custodian will be required to perform its services until another custodian bank has been appointed and all the assets of the Sicav have been transferred to it. KBL European Private Bankers is a société anonyme under Luxembourg law. It was incorporated in Luxembourg on 23 May Its registered office is located at 43 boulevard Royal in Luxembourg,. The company s share capital came to ,00 EUR on 31 December The names of the financial services providers in countries other than Luxembourg where the shares are marketed are given in the Appendix concerning the marketing of the Sicav in the country in question. 5. Central Administration The Management Company has appointed KREDIETRUST LUXEMBOURG S.A. as Domiciliary Agent, Administrative Agent and Registrar and Transfer Agent of the Company on the basis of agreements entered into force on May 1, KREDIETRUST LUXEMBOURG S.A. was established on 16 February 1973 as a société anonyme under Luxembourg law. Its registered office is located at 11 rue Aldringen, L Luxembourg. KREDIETRUST LUXEMBOURG S.A. is a subsidiary of KBL European Private Bankers. For all or part of the tasks attributed to it and on its own responsibility, KREDIETRUST LUXEMBOURG, as Administrative Agent and Registrar and Transfer Agent, may call on the services of European Fund Administration ( E.F.A. ), a société anonyme, with registered office in Luxembourg. KREDIETRUST LUXEMBOURG S.A. will be paid by the Management Company. Personal data of the subscriber and/or the distributor are administered by KBL European Private Bankers., KREDIETRUST Luxembourg S.A. and by EUROPEAN FUND ADMINISTRATION S.A. ( EFA ) in order to assure the administration and commercialisation of the Sicav, the treatment of the operations in accordance with the provisions of the prospectus and service provider agreements, the accurate assignment of any received payments, the accurate payment of agreed commissions; the holding of shareholder meetings as well as the issuance of share certificates, if applicable. The subscriber or the distributor have a right of access to their personal data for modifcation, correction or updating. 6. Investment objectives of the sub-funds In order to know if a sub-fund has a capital protection or not, please refer to chapter Investment policy of the capital-protected sub-funds The objective of the investment policy of the capital protected sub-funds is to repay the initial subscription price in total or partially and to provide a possible return at Maturity through investments in swaps. The financial mechanism intented to provide capital protection at Maturity entails investing all amounts subscribed in bonds, structured bonds and other debt instruments, money market instruments, units or shares in undertakings for collective investment, deposits, financial derivatives and/or liquidities (including money deposited in term deposits or cash accounts). These investments may have different durations and coupon payment dates geared to the due dates of the sub-fund s liabilities through swaps as described in point b permitted swaps transactions On these due dates, the investments are re-balanced in order to absorb the projected volume of redemptions in the sub-sequent period. No formal guarantee of redemption of the initial subscription price is given either to the sub-fund or the shareholders except otherwise specified in the detailed description of the sub-fund. In order to achieve a possible return the sub-fund concludes swaps with one or more prime counterparties. It is the reason why the sub-fund transfers part of the future income from its investments intended to provide the capital protection during the life of the sub-fund to the counterparty( counterparties). In return, the counterparty (counterparties) undertake(s) to provide a possible return as described in the Selected Strategy of the sub-fund. 11

12 The counterparty of the swaps don t assume any discretion over the composition or management of the UCITS investment portfolio or over the underlying of the financial derivative instruments, and the approval of the counterparty is not required in relation to any UCITS investment portfolio transaction. I) Permitted swap transactions Derivatives may be used either for hedging purposes or to achieve investment aims. Changes are made to investments at regular intervals in keeping with the sub-fund's investment strategy. In addition, listed and unlisted derivatives are used to achieve the objectives: these may be forward contracts, options or swaps on securities, indexes, currencies or interest rates or other transactions involving derivatives. Unlisted derivatives transactions will only be concluded with prime financial institutions specialised in such transactions. Such derivatives may also be used to hedge the assets against exchange-rate fluctuations. Subject to the applicable laws and regulations and the articles of association, the sub-fund always seeks to conclude the most effective transactions. The swaps described below are entered into with one or more prime counterparties within the limits set by law. (1) In order to achieve a possible return, the sub-fund concludes swaps. Under these swaps, the sub-funds undertakes to transfer part of the future income from its investments intended to provide the capital protection during the life of the sub-fund to the counterparty or counterparties. In return, the counterparty or counterparties undertake(s) to provide a possible return as referred to in Selected Strategy. The swaps referred to under (1) are essential for achieving the sub-fund's investment objectives, since the object of achieving a possible return may be fulfilled by means of this technique. The sub-fund s risk profile is not affected by the use of this swaps. (2) If necessary, the sub-fund concludes swaps so that the durations of the sub-fund's liabilities coincide with the cash flows generated by deposits, bonds and other debt instruments. These swaps are essential for achieving the sub-funds investment objectives, since it is not possible to find sufficient bonds and other debt instruments in the market for which the coupons and the maturity dates coincide exactly with the due dates of the sub-fund s liabilities. The sub-fund s risk profile is not affected by the use of this swaps. (3) The sub-fund may also conclude swaps to hedge the credit risk on issuers of bonds and other debt instruments. By means of these swaps, one or more counterparties assume, in exchange for a premium payable by the sub-fund, the risk of an issuer of a bond or other debt instrument included in the sub-fund's portfolio defaulting. The swaps referred to under (3) serve as coverage of the credit risk. The portfolio of the sub-funds is not subject directly to a Total Return Swap. II) Management of collateral 1. General principles The risk exposure to a counterparty arising from OTC financial derivative transactions and efficient portfolio management techniques should be combined when calculating the counterparty risk limits of point In case of OTC derivatives, collateral is provided to make sure that the counterparty risk is below 10% of the funds net asset value. The level of collateral is minimum 100% of ( OTC exposure as percentage of fund NAV-x), where x is lower than 10%. In determing the required collateral, minimum operational threshold levels and the haircut levels mentioned below are taken into account. Where a sub-fund enters into OTC financial derivative transactions and efficient portfolio management technique, all collateral used to reduce counterparty risk exposure shall comply with the following criteria at all times : (A) Any collateral received other than cash shall be highly liquid and traded on a regulated market or multilateral trading facility with transparent pricing in order that it can be sold quickly at a price that is close to pre-sale valuation. Collateral received shall also comply with the provisions of

13 (B) For assets received a daily independent valuation is available. Assets that exhibit high price volatility shall not be accepted as collateral unless suitably conservative haircuts are in place. (C) Collateral received shall be of high quality. (D) The collateral received shall be issued by an entity that is independent from the counterparty and is expected not to display a high correlation with the performance of the counterparty. (E) Collateral shall be sufficiently diversified in terms of country, markets and issuers. The criterion of sufficient diversification with respect to issuer concentration is considered to be respected if the Fund receives from a counterparty of efficient portfolio management and over-the-counter financial derivative transactions a basket of collateral with a maximum exposure to a given issuer of 20% of its Net Asset Value. When a fund is exposed to different counterparties, the different baskets of collateral shall be aggregated to calculate the 20% limit of exposure to a single issuer. (F) Where there is a title transfer, the collateral received shall be held by the Custodian. For other types of collateral, arrangement, the collateral can be held by a third party custodian which is subject to prudential supervision, and which is unrelated to the provider of the collateral. (G) Collateral received shall be capable of being fully enforced by the Fund at any time without reference to or approval from the counterparty. (H) Non cash collateral received shall not be sold, re-invested or pledged. (I) Cash collateral should only be : - placed on deposit with entities prescribed under point invested in high-quality government bonds - used for the purpose of repurchase transactions provide the transactions are with credit institutions subject to prudential supervision and the Fund is able to recall at any time the full amount of cash on accrued basis - invested in short-term money market funds as defined in the Guidelines on a Common Definition of European Money Market Funds Re-invested cash collateral shall be diversified in accordance with the diversification requirements applicable to noncash collateral. 2. Collateral policy of the Fund Collateral received by the Fund shall predominatly be limited to cash and investment grade bonds : sovereign and covered bonds). Actually the Fund only receives investment grade bonds as collateral and no cash. As the Fund don t receive cash as collateral there is no re-investment policy and no risks arising from the reinvestment policy. In case of use of cash collateral the prospectus will be updated accordingly. 3. Haircut policy The following haircuts for collateral OTC transactions are applied by the Management Company ( the Management Company reserves the right to vary this policy at any time in which case the prospectus will be updated accordingly. For the moment the sub-fund doesn t use cash collateral. Assets denominated in currency of the compartment Assets not denominated in currency of the compartment Credit Residual maturity Liquidity Categories Liquidity Categories Quality* (yrs) Cash Sovereign Covered Cash Sovereign Covered AAA % 0.5% 5.5% 5.0% 5.5% 10.5% 13

14 % 1.5% 6.5% 5.0% 6.5% 11.5% % 2.5% 7.5% 5.0% 7.5% 12.5% % 3.0% 8.0% 5.0% 8.0% 13.0% % 4.0% 9.0% 5.0% 9.0% 14.0% > % 5.5% 10.5% 5.0% 10.5% 15.0% AA+ to AA % 0.5% 15.0% 5.0% 5.5% 15.0% % 1.5% 15.0% 5.0% 6.5% 15.0% % 2.5% 15.0% 5.0% 7.5% 15.0% % 3.0% 15.0% 5.0% 8.0% 15.0% % 4.0% 15.0% 5.0% 9.0% 15.0% > % 5.5% 15.0% 5.0% 10.5% 15.0% below A % 0.5% n.a. 5.0% 5.5% n.a % 1.5% n.a. 5.0% 6.5% n.a % 2.5% n.a. 5.0% 7.5% n.a % 3.0% n.a. 5.0% 8.0% n.a % 4.0% n.a. 5.0% 9.0% n.a. > % 5.5% n.a. 5.0% 10.5% n.a. * Split rating by S&P, Moody's, Fitch 6.2. Investment objective of the sub-funds without capital protection a) Introduction No formal guarantee is given to either the sub-fund or its shareholders. The sub-fund does not offer a guaranteed return nor does it afford capital protection, either before or at Maturity. The main objective of this sub-fund is to generate the highest possible return for the shareholders by investing in transferable securities and liquid assets, the income from which will be used to conclude swaps, within the limits imposed by law, with one or more prime counterparties. The use of derivatives by this sub-fund may, besides resulting in the use of investment income, also lead to the (full) loss of the capital invested at the outset. The counterparty of the swaps don t assume any discretion over the composition or management of the UCITS investment portfolio or over the underlying of the financial derivative instruments, and the approval of the counterparty is not required in relation to any UCITS investment portfolio transactions. b) Permitted swap transactions Derivatives may be used either for hedging purposes or to achieve investment aims. Changes are made to investments at regular intervals in keeping with the sub-fund's investment strategy. In addition, listed and unlisted derivatives are used to achieve the objectives: these may be forward contracts, options or swaps on securities, indexes, currencies or interest rates or other transactions involving derivatives. Unlisted derivatives transactions will only be concluded with prime financial institutions specialised in such transactions. Such derivatives may also be used to hedge the assets against exchange-rate fluctuations. Subject to the applicable laws and regulations and the articles of association, the sub-fund always seeks to conclude the most effective transactions. The swaps described below are entered into with one or more prime counterparties within the limits set by law. (1) In order to achieve a possible return, the sub-fund concludes swaps. Under these swaps, the sub-funds undertakes to transfer part of the future income from its investments intended to provide the capital protection during the life of the sub-fund to the counterparty or counterparties. In return, the counterparty or counterparties undertake(s) to provide a possible return as referred to in Selected Strategy. The swaps referred to under (1) are essential for achieving the sub-fund's investment objectives, since the object of achieving a possible return may be fulfilled by means of this technique. 14

15 The sub-fund s risk profile is not afected by the use of this swaps. (2) If necessary, the sub-fund concludes swaps so that the durations of the sub-fund's liabilities coincide with the cash flows generated by deposits, bonds and other debt instruments. These swaps are essential for achieving the sub-funds investment objectives, since it is not possible to find sufficient bonds and other debt instruments in the market for which the coupons and the maturity dates coincide exactly with the due dates of the sub-fund s liabilities. The sub-fund s risk profile is not afected by the use of this swaps. (3) The sub-fund may also conclude swaps to hedge the credit risk on issuers of bonds and other debt instruments. By means of these swaps, one or more counterparties assume, in exchange for a premium payable by the sub-fund, the risk of an issuer of a bond or other debt instrument included in the sub-fund's portfolio defaulting. The swaps referred to under (3) serve as coverage of the credit risk. The sub-fund s risk profile is not afected by the use of this swaps. The portfolio of the sub-funds is not subject directly to a Total Return Swap. c) Management of collateral 1. General principles The risk exposure to a counterparty arising from OTC financial derivative transactions and efficient portfolio management techniques should be combined when calculating the counterparty risk limits of point In case of OTC derivatives, collateral is provided to make sure that the counterparty risk is below 10% of the funds net asset value. The level of collateral is minimum 100% of ( OTC exposure as percentage of fund NAV-x), where x is lower than 10%. In determing the required collateral, minimum operational threshold levels and the haircut levels mentioned below are taken into account. Where a sub-fund enters into OTC financial derivative transactions and efficient portfolio management technique, all collateral used to reduce counterparty risk exposure shall comply with the following criteria at all times : (A) Any collateral received other than cash shall be highly liquid and traded on a regulated market or multilateral trading facility with transparent pricing in order that it can be sold quickly at a price that is close to pre-sale valuation. Collateral received shall also comply with the provisions of (B) For assets received a daily independent valuation is available. Assets that exhibit high price volatility shall not be accepted as collateral unless suitably conservative haircuts are in place. (C) Collateral received shall be of high quality. (D) The collateral received shall be issued by an entity that is independent from the counterparty and is expected not to display a high correlation with the performance of the counterparty. (E) Collateral shall be sufficiently diversified in terms of country, markets and issuers. The criterion of sufficient diversification with respect to issuer concentration is considered to be respected if the Fund receives from a counterparty of efficient portfolio management and over-the-counter financial derivative transactions a basket of collateral with a maximum exposure to a given issuer of 20% of its Net Asset Value. When a fund is exposed to different counterparties, the different baskets of collateral shall be aggregated to calculate the 20% limit of exposure to a single issuer. (F) Where there is a title transfer, the collateral received shall be held by the Custodian. For other types of collateral, arrangement, the collateral can be held by a third party custodian which is subject to prudential supervision, and which is unrelated to the provider of the collateral. (G) Collateral received shall be capable of being fully enforced by the Fund at any time without reference to or approval from the counterparty. 15

16 (H) Non cash collateral received shall not be sold, re-invested or pledged. (I) Cash collateral should only be : - placed on deposit with entities prescribed under point invested in high-quality government bonds - used for the purpose of repurchase transactions provide the transactions are with credit institutions subject to prudential supervision and the Fund is able to recall at any time the full amount of cash on accrued basis - invested in short-term money market funds as defined in the Guidelines on a Common Definition of European Money Market Funds Re-invested cash collateral shall be diversified in accordance with the diversification requirements applicable to noncash collateral. 2. Collateral policy of the Fund Collateral received by the Fund shall predominatly be limited to cash and investment grade bonds : sovereign and covered bonds). Actually the Fund only receives investment grade bonds as collateral and no cash. As the Fund don t receive cash as collateral there is no re-investment policy and no risks arising from the reinvestment policy. In case of use of cash collateral the prospectus will be updated accordingly. 3. Haircut policy The following haircuts for collateral OTC transactions are applied by the Management Company ( the Management Company reserves the right to vary this policy at any time in which case the prospectus will be updated accordingly. For the moment the sub-fund doesn t use cash collateral. Assets denominated in currency of the compartment Assets not denominated in currency of the compartment Credit Residual maturity Liquidity Categories Liquidity Categories Quality* (yrs) Cash Sovereign Covered Cash Sovereign Covered AAA % 0.5% 5.5% 5.0% 5.5% 10.5% % 1.5% 6.5% 5.0% 6.5% 11.5% % 2.5% 7.5% 5.0% 7.5% 12.5% % 3.0% 8.0% 5.0% 8.0% 13.0% % 4.0% 9.0% 5.0% 9.0% 14.0% > % 5.5% 10.5% 5.0% 10.5% 15.0% AA+ to AA % 0.5% 15.0% 5.0% 5.5% 15.0% % 1.5% 15.0% 5.0% 6.5% 15.0% % 2.5% 15.0% 5.0% 7.5% 15.0% % 3.0% 15.0% 5.0% 8.0% 15.0% % 4.0% 15.0% 5.0% 9.0% 15.0% > % 5.5% 15.0% 5.0% 10.5% 15.0% below A % 0.5% n.a. 5.0% 5.5% n.a % 1.5% n.a. 5.0% 6.5% n.a % 2.5% n.a. 5.0% 7.5% n.a % 3.0% n.a. 5.0% 8.0% n.a % 4.0% n.a. 5.0% 9.0% n.a. 16

17 > % 5.5% n.a. 5.0% 10.5% n.a. * Split rating by S&P, Moody's, Fitch 7. Investment restrictions Under the articles of incorporation and within the limits laid down therein, the Board of Directors is authorised to determine the investment policy of each sub-fund into which the company s assets are divided. Save with regard to what is set out under 7.4 and unless otherwise indicated, the limits apply per sub-fund Eligible instruments Quoted securities and money market instruments transferable securities and money market instruments admitted to or dealt in on a regulated market within the meaning of Directive 2004/39/EC of the European Parliament and the Council of 21 April 2004 on markets in financial instruments; transferable securities and money market instruments dealt in on another market in a Member State which is regulated, operates regularly and is recognised and open to the public; transferable securities and money market instruments admitted to offical listing on a stock exchange in a non-member State of the European Union or dealt in on another market in a non-member State of the European Union which is regulated, operates regularly and is recognised and open to the public provided that the the choice of the stock exchnage or market has been provided for in the constitutional documents of the SICAV recently issued transferable securities and money market instruments, provided that: the terms of issue include an undertaking that application will be made for admission to official listing on a stock exchange or on another regulated market which operates regularly and is recognised and open to the public, provided that the choice of the stock exchange or the market has been provided for in the present prospectus; the admission is secured within one year of issue Shares/units in UCIs shares/units of UCITS authorised according to Directive 2009/65/EC and/or other UCIs within the meaning of Article 1, paragraph 2,,, points a) and b), of Directive 2009/65/EC, whether or not established in a Member State provided that: such other UCIs are authorised under laws which provide that they are subject to supervision considered by the Luxembourg financial services authority, the CSSF, to be equivalent to that laid down in Community law, and that cooperation between the authorities is sufficiently ensured; the level of protection for unitholders in the other UCIs is equivalent to that provided for unitholders in a UCITS, and in particular that the rules on assets segregation, borrowing, lending and uncovered sales of transferable securities and money market instruments are equivalent to the requirements of Directive 2009/65/EC; the business of the other UCIs is reported in half-yearly and annual reports to enable an assessment of the assets and liabilities, income and operations for the reporting period; no more than 10% of the assets of the UCITS or the other UCIs whose acquisition is contemplated, can, according to their instruments of incorporation, be invested in aggregate in units of other UCITS or other UCIs. 17

18 Deposits deposits with a credit institution, which are repayable on demand or have the right to be withdrawn, and maturing in no more than 12 months, provided that the credit institution has its registered office in a Member State or, if the registered office of the credit institution is situated in a third country, provided that it is subject to prudential rules considered by the CSSF to be equivalent to those laid down in Community law Derivatives instruments financial derivative instruments, including equivalent cash-settled instruments dealt in on a regulated market referred to in points , and above; and/or financial derivative instruments dealt in over-the-counter ( OTC derivatives ), provided that : the underlying consists of instruments mentioned under point,7.1 financial indices, interest rates, foreign exchange rates or currencies in which the SICAV may invest pursuant to this prospectus, the counterparties to OTC derivative transactions are institutions subject to prudential supervision and belonging to the categories approved by the CSSF, and the OTC derivatives are subject to reliable and verifiable valuation on a daily basis and can be sold, liquidated or closed by an offsetting transaction at any time and at their fair value at the SICAV initiative. These derivative instruments may be used both for hedging purposes as well as with a view to achieving the investment objectives Unlisted monetary instruments money market instruments other than those dealt in on a regulated market and which fall under Article 1 of the Law of 17 December 2010, if the issue or the issuer of such instruments is itself regulated for the purpose of protecting investors and savings and provided that these instruments are: issued or guaranteed by a central, regional or local authority or by a central bank of a Member State, the European Central Bank, the European Union or the European Investment Bank, a non-member State or, in case of a federal State, by one of the members making up the federation, or by a public international body to which one or more Member States belong, or issued by an undertaking any securities of which are dealt in on regulated markets referred to in points , or above, or issued or guaranteed by an establishment subject to prudential supervision, in accordance with criteria defined by Community law, or by an institution which is subject to and complies with prudential rules considered by the CSSF to be at least as stringent as those laid down by Community law, or issued by other bodies belonging to the categories approved by the CSSF, provided that investments in such instruments are subject to investor protection equivalent to that laid down in the first, the second and the third indent and provided that the issuer is a company whose capital and reserves amount to at least ten million euro ( EUR) and which presents and publishes its annual accounts in accordance with the fourth Directive 78/660/EEC, is an entity which, within a group of companies which includes one or several listed companies, is dedicated to the financing of the group, or is an entity which is dedicated to the financing securitisation vehicles benefit from a banking liquidity line Liquid Assets The SICAVmay hold ancillary liquid assets Other The SICAV may invest no more than 10% of its assets in transferable securities or money market instruments other than those referred to above; The SICAV may acquire movable and immovable property which is essential for the direct pursuit of its business; The SICAV may not acquire either precious metals or certificates representing them. 18

19 7.2. Techniques and instruments used A management company having its registered office in Luxembourg shall employ a risk-management process which enables it to monitor and measure at any time the risk of the positions and their contribution to the overall risk profile of the portfolio; it shall employ a process for accurate and independent assessment of the value of OTC derivatives. It shall communicate to the CSSF regurlarly, in accordance with the detailed rules the latter shall define, in regard to the types of derivatives instruments, the underlying risks, the quantitative limits and the methods which are chosen in order to estimate the risks associated with transaction in derivative instruments regarding each managed UCITS. An investment company having its registered office in Luxembourg is subject to the same obligation The SICAV may employ techniques and instruments relating to transferable securities and money market instruments under the conditions and within the limits laid down by the CSSF Circular 11/512, provided that such techniques and instruments are used for the purpose of efficient portfolio management. When these operations concern the use of derivative instruments, these conditions and limits shall conform to the provisions of the Law. Under no circumstances shall these operations cause the SICAV to diverge from its investment objectives as set out in this prospectus. The Fund is not engaged for the moment in securities lending transactions. In case of use of securities lending transactions in the future the prospectus will be amended accordingly. The Fund is not engaged in reverse purchase agreements and repurchase agreements The SICAV shall ensure that its global exposure relating to derivative instruments does not exceed the total net value of its portfolio. The exposure is calculated taking account the current value of the underlying assets, the counterparty risk, future market movements and the time available to liquidate the positions. This shall also apply to the following paragraphs. The SICAV may invest, as a part of its investment policy and within the limits laid down onder point in financial derivative instruments, provided that the exposure to the underlying assets does not exceed in aggregate the investment limits established under point When the SICAV invests in index-based financial derivative instruments, those investments are not required to be combined for the purpose of the limits laid down in point When a transferable security or a money market instrument embed in a derivative instrument, the derivative instrument shall be taken into account when complying with the requirements of this Article Spreading of risks General rules The SICAV may not invest more than 10% of its assets in transferable securities or money market instruments issued by the same body. The SICAV may not invest more than 20% of its assets in deposits made with the same body. The risk exposure to a counterparty of the SICAV in an OTC derivative transaction may not exceed 10% of its assets when the counterparty is a credit institution referred to under point , or 5% of its assets in other cases The total value of the transferable securities and money market instruments held by the SICAV in the issuing bodies in each of which it invests more than 5% of its assets shall not exceed 40% of the value of its assets. This limitation does not apply to deposits and OTC derivative transactions madewith financial institutions subject to prudential supervision. Notwithstanding the individual limits set under point , the SICAV shall not combine, where this would lead to investment of more than 20% of its assets in a single body, any of the following: investments in transferable securities or money market instruments issued by that body, 19

20 deposits with that body or, exposures arising from OTC derivative transactions undertaken with that body, The limit laid down in the first sentence of may be of a maximum of 35% if the transferable securities or money market instruments are issued or guaranteed by a Member State, by its local authorities, by a Non-Member State or by public international bodies of which one or more Member States belong The limit laid down in the first sentence of may be of a maximum of 25% for certain bonds where they are issued by a credit institution which has its registered office in a Member State and is subject by law, to special public supervision designed to protect the bondholders. In particular, sums deriving from the issue of these bonds must be invested, in accordance with the law, in assets which, during the whole period of validity of the bonds, are capable of covering claims attaching to the bonds and which, in case of the bankruptcy of the issuer, would be used on a priority basis for the reimbursement of the principal and payment of the accrued interest. If the SICAV invests more than 5% of its assets in the bonds mentioned in the first subparagraph which are issued by a single issuer, the total value of such investments may not exceed 80% of the value of the assets of the SICAV The transferable securities and money market instruments referred to in paragraphs and shall not be taken into account for the purposes of applying the limit of 40% mentioned in paragraph The limits set out in points , , and shall not be combined; thus investments in transferable securities or money market instruments issued by the same body, or in deposits or derivative instruments made with this same body carried out in accordance with points , , and , shall not exceed 35 of the assets of the SICAV. Companies grouped together for the purposes of consolidated accounts, as defined in accordance with Directive 83/349/EEC or in accordance with recognised international accounting rules, are considered as a single body for the purpose of calculating the limits contained in this article. A SICAV may cumulatively invest up to a limit of 20% of its assets in transferable securities and money market instruments within the same group Replication of the index Without prejudice to the limits provided for under point 7.4, the limits specified under are raised to a maximum 20% for investments in shares and/or debt securities issued by the same body when, according to the management regulations or instruments of incorporation of the SICAV, the aim of the SICAV investment policy is to replicate the composition of a certain stock or debt securities index which is recognised by the CSSFon the following basis: the composition of the index is sufficiently diversified; the index represents an adequate benchmark for the market to which it refers; it is published in an appropriate manner The limit laid down under point is raised to 35% where that proves to be justified by exceptional market conditions in particular in regulated markets where certain transferable securities or money market instruments are highly dominant. The investment up to this limit is only permitted for a single issuer Exceptions with regard to the spreading of risk By way of derogation from 7.3.1, the sicav, may invest, in accordance with the principle of riskspreading, up to 100% of its assets in different transferable securities and money market instruments issued or guaranteed by a Member State, one or more of its local authorities, an OCDE Member state, Singapore, Brazil, Russia, Indonesia, South Africaor public international body to which one or more Member States of the European Union belong. The sicav shall hold securities from at least six different issues but securities from any single issue shall not exceed 30% of its total assets Funds of funds The Sicav may acquire the shares/units of UCITS and/or other UCIs referred to under 7.1.2, provided that no more than 20% of its assets are invested in the units of a single UCITS or other UCI. 20