Zenith Investment Fund p.l.c. (an umbrella type open-ended investment company with variable capital)

Transcription

1 Zenith Investment Fund p.l.c. (an umbrella type open-ended investment company with variable capital) A company incorporated with limited liability as an investment company with variable capital under the laws of Ireland with registered number PROSPECTUS This Prospectus is dated the 29 th day of June, The Directors of Zenith Investment Fund p.l.c. whose names appear on pages 9 to 11 accept responsibility for the information contained in this Prospectus. To the best of the knowledge and belief of the Directors (who have taken all reasonable care to ensure such is the case) the information contained in this document is in accordance with the facts and does not omit anything likely to affect the import of such information. This Prospectus should be read in conjunction with the supplement dealing with the relevant portfolio. #6567(8)(v7)(v6)(v5)(v4)(v3)(v2)(v1) (MRB\Import\MBPP M)

2 Zenith Investment Fund p.l.c. The authorisation of Zenith Investment Fund p.l.c. (the "Company") by the Central Bank of Ireland (the Central Bank ) shall not constitute a warranty as to the performance of the Company and the Bank shall not be liable for the performance or default of the Company. The value of and income from participating shares (the "Shares") in the Company may go up or down and you may not get back the amount you have invested in the Company. Shares constituting each portfolio offered by the Company (each a "Portfolio") are described in Supplements to this Prospectus for each such Portfolio, each of which is an integral part of this Prospectus and is incorporated herein by reference with respect to the relevant Portfolio. Before investing in the Company, you should consider the risks involved in such investment. Please see "Risk Factors" applicable to each Portfolio in the Supplement for each Portfolio. If you are in any doubt about the contents of this Prospectus you should consult your Stockbroker, Bank Manager, Solicitor, Accountant or other financial adviser. Distribution of this Prospectus is not authorised in any jurisdiction after publication of the annual report and audited accounts of the Company for the period up to 31 st December, 2000 unless accompanied by a copy of the said report and audited accounts of the Company and, if published after such report, a copy of the then latest semi-annual report and unaudited accounts. Such reports and this Prospectus together form the prospectus for the issue of Shares in the Company. The Company is an investment company with variable capital incorporated on 22 nd March, 2000 and is authorised in Ireland as an undertaking for collective investment in transferable securities pursuant to the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations, 1989 (S.I. No. 78 of 1989) as amended. Such authorisation is not an endorsement or guarantee of the Company or any Portfolio by the Central Bank, nor is the Central Bank responsible for the contents of this Prospectus. Application may be made to the Irish Stock Exchange for the Shares of any Portfolio to be admitted to the official list of the Irish Stock Exchange. This Prospectus and the relevant Supplement constitute the listing particulars for any such application for listing. No application has been made for the Shares of the Company to be listed on any other stock exchange. The Directors do not anticipate that an active secondary market will develop in the 2

3 Shares of any Portfolio. Neither the admission of Shares of any Portfolio to the official list nor the approval of the Prospectus and any Supplement shall constitute a warranty or representation by the Irish Stock Exchange as to the competence of service providers to or any other party connected with such Portfolios, the adequacy of information contained in the Prospectus and the relevant Supplement or the suitability of such Portfolios for investment purposes. This Prospectus may not be used for the purpose of an offer or solicitation in any jurisdiction or in any circumstances in which such offer or solicitation is unlawful or not authorised. In particular: the Shares have not been registered under the United States Securities Act of 1933 (as amended) and may not, except in a transaction which does not violate US securities laws, be directly or indirectly offered or sold in the United States (as defined on page 50) or to any United States Person (as defined on page 50). The Company will not be registered under the United States Investment Company Act of It is currently the Company's policy not to permit Shares to be purchased or held by or for an Irish Person (as defined on pages 47 and 48) until after 31 st December, The Directors have the discretion, in consultation with the Administrator, to change this policy. This Prospectus is issued in the United Kingdom ( UK ) by Laing & Cruickshank Investment Management Limited, which is regulated in the conduct of its investment business by the Financial Services Authority. Notice to investors in the United Kingdom: The Company is a collective investment scheme pursuant to the provisions of the UK Financial Services Act 1986 ( FSA ) but is not a recognised fund for the purposes of the FSA, and Shares may only be promoted in the UK by persons authorised to carry on investment business in the UK ( Authorised Persons ) to other Authorised Persons, persons whose ordinary business involve the acquisition or disposal of property of the same kind as the property or a substantial part of the property to which the Company relates, and to those persons to whom unregulated collective investment schemes can be marketed pursuant to the UK Financial Services (Promotion of Unregulated Schemes) Regulations It should be appreciated that the value of the Shares, and any income from them, is not guaranteed and may go down as well as up. Investors in the Company may not receive, on redemption of the Shares, the amount that they invested. Fluctuations in the rate of exchange between the currency in which the Shares are denominated and the currency of investment may have the effect of causing the value of an investment in the Shares to diminish or increase. The right to redeem Shares may be suspended in certain circumstances. The investment objective and policies relating to each Portfolio are set out in the relevant Supplement to this Prospectus. An investor in the Company will not be protected by the regulations made under the FSA including being protected by the UK Investors 3

4 Compensation Scheme. If the Supplements of this Prospectus so provide, certain contingent liability transactions may be undertaken by the Company in contracts traded either over-thecounter or on a recognised or designated investment exchange, and the Company may invest in warrants. Warrants involve a high degree of gearing so that a relatively small movement in the price of the security to which the warrant relates may result in a disproportionately large movement, unfavourable as well as favourable, in the price of the warrant. The tax rules or their interpretation in relation to an investor s status as a Shareholder may change during the life of the Company. UK Shareholders will not have the right (provided under the United Kingdom Financial Services (Non-Life Cancellation) Rules, 1997) to cancel the investment agreement constituted by the acceptance by or on behalf of the Company of an application for Shares. The Articles of Association of the Company give powers to the Directors to impose restrictions on the holding of Shares by (and consequently to repurchase Shares held by), or the transfer of Shares to, any United States Persons or by any person who appears to be in breach of the laws or requirements of any country or government authority or by any person or persons in circumstances (whether directly or indirectly affecting such person or persons, and whether taken alone or in conjunction with any other persons, connected or not, or any other circumstances appearing to the Directors to be relevant) which, in the opinion of the Directors, might result in the Company incurring any liability to taxation or suffering any other pecuniary, regulatory legal or material administrative disadvantage which the Company might not otherwise have incurred or suffered. The Articles of Association also permit the Directors where necessary to repurchase and cancel Shares (including fractions thereof) held by a person who is an Irish Person on the occurrence of a chargeable event for Irish taxation purposes. Potential subscribers and purchasers of Shares should inform themselves as to (a) the possible tax consequences, (b) the legal requirements, (c) any foreign exchange restrictions or exchange control requirements and (d) any other requisite governmental or other consents or formalities which they might encounter under the laws of the countries of their incorporation, citizenship, residence or domicile and which might be relevant to the subscription, purchase, holding or disposal of Shares. Any information given, or representations made, by any dealer, salesman or other person not contained in this Prospectus, any Supplement to this Prospectus or in any reports and accounts of the Company forming part hereof must be regarded as unauthorised and accordingly must not be relied upon. Neither the delivery of this Prospectus nor the offer, issue or sale of Shares shall under any circumstances constitute a representation that the information contained in this Prospectus is correct as of any time subsequent to the date of this Prospectus. To reflect material changes, this Prospectus may from time to time be updated and intending subscribers should enquire of the Administrator or the Investment Manager as to the issue of any later Prospectus or as to the issue of any reports and accounts 4

5 of the Company. 5

6 Zenith Investment Fund p.l.c. TABLE OF CONTENTS Section Page Number Directory Introduction Directors of the Company Investment Manager Custodian Administrator Investment Objective and Policies Investment Restrictions Efficient Portfolio Management Borrowing and Lending Powers Risk Factors Dividend Policy Applications for Shares Repurchases of Shares Exchange of Shares Issue and Repurchase Prices/Calculation of Net Asset Value/Valuation of Assets Suspension of Calculation of Net Asset Value Charges and Expenses Soft Commissions Portfolio Transactions and Conflicts of Interest Taxation General Ireland United Kingdom Reports and Accounts Form of Shares, Share Certificates and Transfer of Shares Notification of Prices General Information Incorporation and Share Capital Memorandum and Articles of Association Litigation and Arbitration

7 Directors' Interests Material Contracts Miscellaneous Documents for Inspection Definitions Appendix

8 DIRECTORY Zenith Investment Fund p.l.c., 25/28 North Wall Quay, Dublin 1, Ireland. INVESTMENT MANAGER Laing & Cruickshank Investment Management Limited, Broadwalk House, 5 Appold Street, London EC2A 2DA, England. CUSTODIAN Bermuda Trust (Dublin) Limited, Europa House, Harcourt Centre, Harcourt Street, Dublin 2, Ireland. ADMINISTRATOR Management International (Dublin) Limited, Europa House, Harcourt Centre, Harcourt Street, Dublin 2, Ireland. AUDITORS PricewaterhouseCoopers, P.O. Box 1283 George' s Quay, Dublin 2, Ireland. IRISH LEGAL ADVISERS TO THE COMPANY A & L Goodbody, International Financial Services Centre, 8

9 North Wall Quay, Dublin 1, Ireland. SPONSORING BROKER Goodbody Stockbrokers, Ballsbridge Park, Ballsbridge, Dublin 4. SECRETARY Goodbody Secretarial Limited, International Financial Services Centre, North Wall Quay, Dublin 1, Ireland. 9

10 INTRODUCTION Zenith Investment Fund p.l.c. (the Company ) is structured as an umbrella fund, in that different Portfolios may be established from time to time by the Directors with the prior approval of the Central Bank. Shares of more than one class may be issued in relation to a Portfolio. On the introduction of any new class of Shares, the Company will prepare and the Directors will issue documentation setting out the relevant details of each such class of Shares. Each class of Shares will relate to a particular portfolio of assets (a Portfolio or Portfolios ) which will be invested in accordance with the investment objective applicable to such Portfolio. Particulars relating to individual Portfolios, and the classes of Shares available therein, are given in a Supplement to this Prospectus issued with respect to each such Portfolio. Laing & Cruickshank Investment Management Limited (the "Investment Manager") serves as investment manager of the Company and as a distributor of the Shares. The Company may decline any application for Shares in whole or in part without assigning any reason therefor and will not accept an initial subscription for Shares of any amount (exclusive of the Preliminary Charge, if any) which is less than the Minimum Initial Subscription as set forth in the Supplement for the relevant Portfolio, unless the Minimum Initial Subscription is waived by the Company. After the initial issue, Shares will be issued and repurchased at the Net Asset Value per Share plus or minus duties and charges (as the case may be) including any preliminary or repurchase charge specified in the relevant Supplement. The Net Asset Value of the Shares of each class and the issue and repurchase prices will be calculated in accordance with the provisions summarised under the heading "Issue and Repurchase Prices/Calculation of Net Asset Value/Valuation of Assets" on pages 22 to 24 hereof. Details of Dealing Days in respect of each Portfolio appear in the relevant Supplement. All holders of Shares will be entitled to the benefit of, will be bound by and deemed to have notice of the provisions of the Memorandum and Articles of Association of the Company summarised under the heading "General Information" on page 35, copies of which are available as detailed on page 44. Directors of the Company The Directors of the Company are described below: Nigel Triptree Nigel D. Triptree, a British national. Mr. Triptree has been an investment director with Laing & Cruickshank 10

11 Investment Management Limited since May He was Director of the Asset Management division of Brewin Dolphin & Co. from 1990 to In 1996 he was appointed to the Main Board of Brewin Dolphin & Co. from which he resigned in May 1999 in order to join Laing & Cruickshank Investment Management Limited. In the past he has held investment directorships with an issuing house and Private Capital Financial Services Limited, a subsidiary of the Scandinavian Banking Group, which was subsequently taken over by Brewin Dolphin. Besides his directorship at Laing & Cruickshank Investment Management he is a director of Hill Samuel U.K. Emerging Companies Investment Trust and Forsyth Partners. In 1991 Mr. Triptree won the Micropal 10 year Life Fund Award. James Scott-Gatty Gerald Brady Paul R. Dobbyn James A. Scott-Gatty, a British national. Mr. Scott- Gatty has been with the Credit Lyonnais Capital Markets Group since In November 1989 he was appointed Finance and Operations Director of Laing & Cruickshank Investment Management Limited. He qualified with B.A. (Honours) in Economic and Statistics from Exeter University and is also a chartered accountant. Gerald J.P. Brady, an Irish national. Mr. Brady has been the Managing Director of Management International (Dublin) Limited (a wholly owned subsidiary of The Bank of Bermuda Limited) since January He has worked for the Bank of Bermuda since He served as Head of Internal Audit in Bermuda and Managing Director of the Cayman operations from 1990 before returning to Dublin in Prior to joining Bank of Bermuda, Mr. Brady served in various capacities in KPMG Dublin. Mr. Brady is a member of the Association for Investment Management and Research, the International Tax Planning Association and the Institute of Directors. He also serves as director of numerous client companies of Bank of Bermuda, many of which are listed on international stock exchanges. Paul R. Dobbyn, an Irish national. Mr. Dobbyn is a 11

12 solicitor and senior partner in the Banking and Financial Services Group in A & L Goodbody Solicitors which is one of Ireland' s largest law firms Denis J. Murphy Denis J. Murphy, an Irish national. Mr. Murphy has been a director of Allied Irish Banks plc since 1977 and is a director of several other prominent Irish companies. For the purposes of this Prospectus, the address of all the Directors is the registered office of the Company. The Company has delegated the day to day management and running of the Company in accordance with policies approved by the Directors to the Custodian, the Administrator and the Investment Manager. Consequently, all Directors of the Company are non-executive. None of the Directors has any unspent convictions, has been declared bankrupt, or has been the subject of an individual voluntary arrangement or a receivership of any assets held by such person. None of the Directors was a director of any company at the time of or within the 12 months preceding its bankruptcy, receivership administration, liquidation administration, company voluntary arrangement or composition or arrangement with its creditors generally. There have been no public criticisms of any of the Directors by any statutory or regulatory authority and no Director has ever been disqualified by a court from acting as a director of a company or from acting in the management or conduct of the affairs of any company. No Director was a partner of any partnership at the time or within 12 months preceding its compulsory liquidation, administration or partnership voluntary arrangement. No Director has had a receiver appointed over any of his assets or of any of the assets of a partnership of which he was a partner or within 12 months after he ceased to be a partner of that partnership. Investment Manager Pursuant to an agreement (summarised under the heading "General Information" below) Laing & Cruickshank Investment Management Limited serves as Investment Manager of the Company. The Investment Manager also serves as the sponsor and promoter of the Company, and provides or arranges for distribution of Portfolios offered by the Company. The Investment Manager is a private limited company incorporated under the laws of England. It is a member of the London Stock Exchange and is regulated by the Financial Services Authority in the United Kingdom. The Investment Manager manages and advises on the investment of managed funds and as at 31 st March, 2000 approximately Stg 5.8 billion in funds under management. The Investment Manager is a subsidiary of Credit Lyonnais Capital Markets PLC. 12

13 Custodian The Company has appointed Bermuda Trust (Dublin) Limited as custodian (the "Custodian") of all of its assets pursuant to a Custodian Agreement (summarised under the heading "General Information" below). The Custodian is a company incorporated as a private limited company in Ireland and which is ultimately a wholly owned subsidiary of The Bank of Bermuda Limited. The Bank of Bermuda Limited was incorporated in Through its main office in Bermuda and through subsidiaries in the Isle of Man, Guernsey, Jersey, Luxembourg, the Cayman Islands, Hong Kong, London, New York, Singapore, New Zealand, Dublin, Mauritius, Bahrain and the Cook Islands, the Bank of Bermuda is engaged in a wide range of international banking and trust services. It has been involved in the servicing of offshore investment vehicles for over 30 years with total client assets under administration in excess of US$65 billion. As at 31 st December, 1999 The Bank of Bermuda Limited had total assets in excess of US$10.2 billion. The main activity of the Custodian is to act as custodian of the assets of collective investment schemes. The Custodian is responsible for the safe-keeping of all of the assets of the Company. The Custodian may appoint any person or persons to be the sub-custodian of the assets of the Company, however the liability of the Custodian shall not be affected by the fact that it has entrusted to a third party some or all of the assets in its safekeeping. The Company and the Custodian acknowledge that the Central Bank considers that in order to discharge its responsibility under the Regulations the Custodian must exercise care and diligence in choosing and appointing a third party as a safe-keeping agent so as to ensure that the third party has, and maintains, the expertise, competence and standing appropriate to discharge its responsibilities. In this regard, the Custodian must maintain an appropriate level of supervision over the safe-keeping agent and make enquiries from time to time to confirm that the obligations of the agent continue to be competently discharged. This does not purport to be a legal interpretation by the Central Bank of the Regulations and the corresponding provisions of the UCITS Directive. Administrator The Company has appointed Management International (Dublin) Limited (the Administrator ), as administrator and registrar of the Company pursuant to an Administration Agreement (summarised under the heading "General Information" below). The Administrator is a private limited liability company incorporated in Ireland on 29 th November, 1991 and which is ultimately a wholly owned subsidiary of The Bank of Bermuda 13

14 Limited. The duties and functions of the Administrator will include, inter alia, the calculation of the Net Asset Value and Net Asset Value per Share of each Portfolio, the provision of facilities for the certification and registration of Shares, the keeping of all relevant records and accounts of the Company as may be required with respect to the obligations assumed by it pursuant to the Administration Agreement, assisting the auditor in relation to the audit of the financial statements of the Company and preparing such other reports, policies, accounts and documents as the Company or the Investment Manager may from time to time reasonably request. Investment Objective and Policies The Articles provide that the investment objective and policies for each Portfolio will be formulated by the Directors at the time of the creation of the Portfolio. Details of the investment objective and policies for each Portfolio of the Company appear in the Supplement for the relevant Portfolio. In the absence of unforeseen circumstances, the principal investment objective and policies for any Portfolio will be adhered to for at least three years following the admission of the Shares of the relevant Portfolio to the Official List of the Irish Stock Exchange. Any change in the investment objective of a Portfolio may only be made with the approval of an ordinary resolution of the Shareholders of the relevant Portfolio. Subject to giving reasonable prior notice to Shareholders to enable them to request the repurchase of their Shares prior to the implementation of any change, the Directors have the power to change the investment objective and policies of a Portfolio. Investment Restrictions The particular investment restrictions for each Portfolio will be formulated by the Directors at the time of the creation of the Portfolio and will appear in the Supplement for the relevant Portfolio. Details of the investment restrictions laid down in accordance with the Regulations in respect of each Portfolio are set out below: 1. A Portfolio may not invest more than 10% of its net assets in transferable securities other than: (i) (ii) transferable securities listed on a stock exchange or dealt in on a regulated, recognised market which operates regularly and is open to the public and which in each case is listed in Appendix II. (The Central Bank does not issue a list of approved exchanges/markets); or recently issued transferable securities when (a) the terms of issue 14

15 include an undertaking that application will be made for admission to official listing on a stock exchange or to another regulated, recognised market which operates regularly and is open to the public provided that the stock exchange or market is provided for in Appendix II of this Prospectus and (b) such admission is secured within one year of issue. This restriction will not apply in relation to investments by a UCITS in certain US securities known as Rule 144A securities provided that: (a) (b) the securities are issued with an undertaking to register with the US Securities and Exchanges Commission within one year of issue; and the securities are not illiquid securities i.e. they may be realised by the Portfolio within seven days at the price, or approximately at the price, at which they are valued by the Portfolio; Rule 144A Securities which do not meet with the conditions listed at (a) and (b) are subject to the above mentioned 10% restriction. 2. A Portfolio may not invest more than 10% of its net assets in transferable securities issued by the same body nor more than 40% of its net assets in transferable securities of issuing bodies in each of which the relevant Portfolio invests more than 5% of its net assets; 3. (i) Notwithstanding 2 above, a Portfolio may invest up to 35% of its net assets in transferable securities issued or guaranteed by a Member State, a non-member State, the local authority of a Member State, or by a public international body of which one or more Member States are members. (ii) (iii) Securities acquired in reliance upon 3(i) above shall not be taken into account for the purpose of applying the 40% limit in 2; however, the limits provided in 2 and 3(i) above cannot be combined and, in addition, no more than 35% of a Portfolio' s net assets may be invested in the securities of one issuer; Furthermore, up to 100% of the net assets of any Portfolio may be invested in transferable securities issued or guaranteed by any Member State, local authority of a Member State or by Japan, Canada, Hong Kong, New Zealand, Australia, Norway, United States of America, Switzerland, European Union, European Investment Bank, European Coal and Steel Community, Euratom, Asian Development Bank, Inter- America Development Bank, European Bank of Reconstruction and Development, International Bank for Reconstruction and Development (the "World Bank"), International Finance Corporation, International Monetary Fund, Federal National Mortgage Association ("Fannie Mae"), the Federal Home Loan Mortgage Corporation ("Freddie Mac") 15

16 and the Government National Mortgage Association ("Ginnie Mae") provided further that the relevant Portfolio holds securities from at least six different issues and that securities from any one issue may not account for more than 30% of its net assets; 4. A Portfolio may not invest more than 5% of its net assets in other collective investment schemes of the open-ended type. A Portfolio shall notify and seek prior authorisation from the Central Bank if it intends to invest in a collective investment scheme managed by the Investment Manager or by any other company to which the Investment Manager is linked by common management or control, or by a substantial direct or indirect holding, and only if that other scheme specialises in investment in a specific geographical area or economic sector; in addition, the Investment Manager may not charge any management fees or costs in relation to interests held by a Portfolio in any such linked scheme; 5. A Portfolio may not acquire shares carrying voting rights which would enable it to exercise a significant influence over the management of an issuing body; 6. A Portfolio may not acquire more than: (i) (ii) (iii) 10% of the non-voting shares of any single issuing body; 10% of the debt securities of any single issuing body; or 10% of the units of any single collective investment scheme of the open-ended type; 7. A Portfolio may not acquire either precious metals or certificates representing them; 8. A Portfolio may not (except as permitted by the Regulations) act as guarantor on behalf of third parties provided that for the purpose of this restriction the acquisition of bonds, debentures, short-term commercial paper, certificates of deposit, bankers' acceptances, money market instruments or other debt securities or obligations permitted by the Regulations, or the acquisition of transferable securities which are not fully paid, shall not be deemed to be the making of a loan; 9. A Portfolio may hold ancillary liquid assets. Where such ancillary liquid assets consist of deposits issued by or securities guaranteed by any one institution, they are subject to a limit of no more than 10% of the net assets of each Portfolio. This limit is increased to 30% for: (i) (ii) An EU credit institution; A bank authorised in a member state of the EEA (Norway, Iceland, Liechtenstein); 16

17 (iii) (iv) A bank authorised by a signatory state, other than a Member State, or a member state of the EEA, to the Basle Capital Convergence Agreement of July 1988 (Switzerland, Canada, Japan, United States); or The Custodian. Related Companies or institutions are regarded as a single issuer for the purposes of this paragraph (9). 10. A Portfolio may not invest more than 5% of its net assets in warrants. The Company need not comply with the above investment limits (2) through (6) when exercising subscription rights attaching to transferable securities which form part of the assets of a Portfolio. If the investment limit percentages referred to in paragraphs (2) through (6) are exceeded for reasons beyond the control of the Company or as a result of the exercise of subscription rights, the Company will adopt as a priority objective for the Company' s sale transactions the remedying of that situation, taking due account of the interests of Shareholders. It is intended that the Company should have the power to avail of any change in the law, regulations or guidelines which would permit investment in assets and securities on a wider basis. The Company will not amend such investment restrictions except in accordance with the requirements of the Central Bank and of the Irish Stock Exchange for as long as the Shares are listed on the Irish Stock Exchange. Efficient Portfolio Management Subject to the specific investment policies and restrictions for a Portfolio set out in the relevant Supplement, the Company may employ techniques and instruments relating to transferable securities under the conditions and within the limits laid down by the Central Bank provided that such techniques and instruments are used for efficient portfolio management. Such techniques may involve the lending of portfolio securities by a Portfolio, but such lending must be secured by adequate collateral. The Company may also employ techniques and instruments intended to provide protection against exchange risks in the context of the management of the assets and liabilities of the Company within the limits prescribed by the Central Bank from time to time (the limits and conditions are set out in Appendix I). The techniques and instruments to be used for each Portfolio, if any, will be set forth in the relevant Supplement. Borrowing and Lending Powers 17

18 The Company may borrow up to 10% of a Portfolio s net assets at any time for the account of any Portfolio and may charge or mortgage the assets of such Portfolio as security for any such borrowing, provided that such borrowing is only for temporary purposes. Any particular borrowing restrictions for a Portfolio will appear in the Supplement for the relevant Portfolio. Without prejudice to the powers of the Company to invest in transferable securities, the Company may not lend to, or act as guarantor on behalf of, third parties. A Portfolio may acquire debt securities and securities which are not fully paid. Risk Factors The investments of the Company in securities are subject to normal market fluctuations and other risks inherent in investing in securities. The value of investments and the income from them, and therefore the value of, and income from, Shares relating to each Portfolio can go down as well as up and an investor may not get back the amount he invests. The difference at any one time between the issue and repurchases prices of Shares means that an investment in Shares should be viewed as medium to long term. Although each Portfolio of the Company will be treated by the Company as bearing its own liabilities, the Company as a whole will remain liable to third parties for all of the liabilities of the Company. Therefore the assets of any Portfolio may be exposed to the liabilities of the other Portfolios within the Company. At the date of this Prospectus, the Directors are not aware of any such existing or contingent liability relating to a Portfolio or the Company which could not be discharged out of the assets of that Portfolio. The Company and the Investment Manager will not have control over the activities of any company or collective investment scheme invested in by a Portfolio. Managers of collective investment schemes and companies in which a Portfolio may invest may take undesirable tax positions, employ excessive leverage, or otherwise manage the collective investment schemes or be managed in a manner not anticipated by the Investment Manager. Additional risk factors (if any) in respect of each Portfolio are set out in the relevant Supplement. Dividend Policy The dividend arrangements relating to each Portfolio will be decided by the Directors at the time of the creation of the relevant Portfolio and details are set out where applicable in the relevant Supplement. Under the Articles, the Directors are entitled to pay such dividends at such times as they think appropriate and as appear to be justified out of the profits, being interest and dividends earned by the relevant Portfolio less expenses of the Portfolio and/or realised profits less realised losses on the disposal of investments of the relevant Portfolio and unrealised profits less unrealised losses on the valuation of investments of the Portfolio, 18

19 provided in each case that dividends may only be paid out of funds available for the purpose which may be lawfully distributed. The Company will be obliged and entitled to deduct an amount in respect of Irish tax from any dividend payable to any investor who is or is deemed to be an Irish Person and to pay such amount to the Revenue Commissioners in Ireland. Certification as a distributing fund under the United Kingdom Income and Corporation Taxes Act, 1988 is intended to be sought for the purposes of UK taxation for the Company which will require all of the Portfolios to follow a full distribution policy. Accordingly, it is the intention of the Directors to distribute in each accounting period not less than 85% of the surplus net income of each Portfolio to Shareholders in each Portfolio. Applications for Shares Under the Articles, the Directors are given authority to effect the issue of Shares of any class and to create new classes of Shares, and have absolute discretion to accept or reject in whole or in part any application for Shares. All Shares of each class will rank pari passu unless otherwise provided when the Shares are first offered for sale. It is intended that issues of Shares will normally be made with effect from a Dealing Day in respect of applications received and payment made on or prior to the relevant Dealing Deadline. Dealing Days and Dealing Deadlines relating to each Portfolio are specified in the Supplement for the relevant Portfolio. Applications for the issue of Shares should be completed by the applicants for Shares and submitted to the Administrator and if an application or related payment is received after the relevant Dealing Deadline for the relevant Dealing Day, the application and/or payment, as the case may be, shall (unless otherwise determined by the Directors and provided they are received before the relevant Valuation Point) be deemed to have been received by the following relevant Dealing Deadline. Applications may be sent to the Administrator by facsimile, however, the original application form must be promptly sent by courier or air mail to the Administrator. The Directors may in their absolute discretion, provided that they are satisfied that no material prejudice would result to any existing Shareholders and subject to the provisions of the Companies Acts 1963 to 1999, allot Shares of any class of a Portfolio against the vesting in the Company of investments which would form part of the assets of the relevant Portfolio. The number of Shares of a Portfolio to be issued in this way shall be the number which would on the day the investments are vested in the relevant Portfolio of the Company have been issued for cash against the payment of a sum equal to the value of the investments. The value of the investments to be vested shall be calculated on such basis as the Directors may decide, but such value cannot exceed the highest amount at which they would be valued by applying the valuation methods described under the heading Issue and Repurchase Prices/Calculation of Net Asset Value/Valuation of Assets below. 19

20 The Minimum Initial Subscription for Shares of a Portfolio that may be subscribed for by each Shareholder on initial application is set out in the relevant Supplement. Thereafter, existing Shareholders may make additional subscriptions for Shares of that Portfolio in an amount as set out in the relevant Supplement. Applications for Shares must be made for specified amounts in value. Fractional Shares will not be issued. Subscription monies representing less than a whole Share will not, unless otherwise determined by the Directors, be returned to the applicant but will be retained as part of the assets of the relevant Portfolio. The Application Form contains certain conditions regarding the application procedure for Shares in the Company and certain indemnities in favour of the Company, the Investment Manager, the Administrator, the Custodian and the other Shareholders for any loss suffered by them as a result of such applicant or applicants acquiring or holding Shares in the Company. Shares may not be issued or sold by the Company during any period when the calculation of the Net Asset Value of the relevant Portfolio is suspended in the manner described under the heading "Suspension of Calculation of Net Asset Value" below. Applicants for Shares will be notified of such suspension and, unless withdrawn, their applications will be considered as at the next Dealing Day following the ending of such suspension. Measures provided for in the Criminal Justice Act, 1994 which are aimed towards the prevention of money laundering may require detailed verification of each applicant' s identity; for example an individual may be required to produce a duly certified copy of his passport or identification card together with evidence of his address such as a utility bill or bank statement and his date of birth. In the case of corporate applicants this may require production of a certified copy of the certificate of incorporation (and any change of name), memorandum and articles of association (or equivalent), the names, occupations, dates of birth and residential and business address of the directors of the company. Depending on the circumstances of each application, a detailed verification may not be required where; (a) the investor makes payment from an account held in the applicant' s name at a recognised financial institution, or (b) the application is made through a recognised intermediary, or (c) investment is made by a recognised intermediary or financial institution. These exceptions will only apply if the financial institution or intermediary referred to above is located in a country which has equivalent anti money laundering legislation to that in place in Ireland. Applicants may contact the Administrator or the Investment Manager in order to determine whether they meet the above exceptions. The Administrator and the Investment Manager reserve the right to request such information as is necessary to verify the identity of an applicant. In the event of delay or 20

21 failure by the applicant to produce any information required for verification purposes, the Administrator may refuse to accept the application and subscription monies. If payment in full in cleared funds in respect of an application has not been received by the relevant Settlement Date (as specified in the Supplement for the relevant Portfolio) or in the event of non-clearance, any provisional allotment of Shares made in respect of such application may be cancelled. In such event and notwithstanding cancellation of the allotment, the Directors may charge the applicant for any expense incurred by it or the Company for any loss to the Company arising out of such non-receipt or non-clearance. Subscription monies in respect of each Portfolio are payable in the relevant Base Currency by telegraphic transfer to the account set out on the Application Form. However, the Company may accept payment in such other currencies as the Company may agree at the exchange rate prevailing on the date of receipt of the subscription monies. Repurchases of Shares Requests for the repurchase of Shares should be made to the Administrator in writing (requests by facsimile will be treated as definite orders) and requests received on or prior to the Dealing Deadline will normally be dealt with on the relevant Dealing Day. If sent by facsimile, the original signed repurchase request must be promptly sent by courier or air mail to the Administrator. Repurchase requests received after the Dealing Deadline shall (unless otherwise determined by the Directors and provided they are received before the relevant Valuation Point) be treated as having been received by the following Dealing Deadline. A repurchase request will not be capable of withdrawal after submission to the Administrator, unless such withdrawal is approved by the Company, acting in its absolute discretion. If requested, the Company may, in its absolute discretion and subject to the prior approval of the Custodian, agree to designate additional Dealing Days and Valuation Points for the repurchase of Shares relating to any Portfolio. The Company may decline to effect a repurchase request which would have the effect of reducing the value of any holding of Shares by any Shareholder relating to any Portfolio below the Minimum Holding (if any) for that Portfolio. Any repurchase request having such an effect may be treated by the Company as a request to purchase the Shareholder' s entire holding. If Shares are held in certificated form, the duly endorsed Share certificate together with the repurchase request form should be sent to the Administrator. Payment of repurchase proceeds will be made to the registered Shareholder or in favour of the joint registered Shareholders as appropriate unless the Administrator is otherwise instructed in writing by the registered Shareholder or joint registered Shareholders. If payment is to be made to a third party, verification of the third party' s identity may be required to satisfy measures aimed at the 21

22 prevention of money laundering. When a repurchase request has been submitted by an investor who is or is deemed to be an Irish Person, the Company shall deduct from the repurchase proceeds an amount which is equal to the tax payable to the Revenue Commissioners in Ireland in respect of the relevant transaction. The amount due on repurchase of Shares will usually be paid by wire transfer at the Shareholder s expense or by negotiable instrument in the Base Currency of the relevant Portfolio (or in such other currency as may be approved by the Company from time to time) within 5 Business Days of processing of a repurchase order, unless a longer period is set forth in the relevant Supplement with respect to a particular Portfolio. The proceeds of the repurchase of the Shares will only be paid on receipt by the Administrator of the original duly renounced Share certificate, if any, issued in respect of the Shares to be repurchased together with the original repurchase request and any other documentation required by the Administrator. The Company is entitled to limit the number of Shares of any Portfolio repurchased on any Dealing Day to 10% of the total number of Shares of that Portfolio in issue. In this event, the limitation will apply pro rata so that all Shareholders wishing to have Shares of that Portfolio repurchased on that Dealing Day realise the same proportion of their Shares. Shares not repurchased, but which would otherwise have been repurchased, will be carried forward for repurchase on the next Dealing Day and will be dealt with in priority (on a pro rata basis) to repurchase requests received subsequently. If requests for repurchase are so carried forward, the Administrator will inform the Shareholders affected. The Articles contain special provisions with respect to a repurchase request received from a Shareholder which would result in Shares representing more than 5% of the Net Asset Value of any Portfolio being repurchased by the Company on any Dealing Day. In such a case, the Company may satisfy the repurchase request in whole or in part by a distribution of investments of the relevant Portfolio in specie, provided that such a distribution would not be prejudicial to the interests of the remaining Shareholders of that Portfolio. Where a Shareholder requesting such repurchase receives notice of the Company' s intention to elect to satisfy the repurchase request by such a distribution of assets, the Shareholder may require that the Company, instead of transferring those assets, arrange for their sale and the payment of the net proceeds of sale to that Shareholder. The Company may repurchase all the Shares of any Portfolio if, at any time after the initial issue of such Shares, the Net Asset Value of the relevant Portfolio is less than such amount as the Directors determine, in their sole discretion, is adequate to maintain a Portfolio of sufficient size to serve the best interests of its Shareholders. 22

23 Exchange of Shares Shareholders will be able to apply to exchange on any Dealing Day all or part of their holding of Shares of any class (the Ori ginal Class ) for Shares of another class which are being offered at that time (the New Class ) by giving notice to the Administrator on behalf of the Company on or prior to the Dealing Deadline for the relevant Dealing Day. The general provisions and procedures relating to repurchases will apply equally to exchanges. All exchanges will be treated as a repurchase of the Shares of the Original Class and application of the net proceeds to the purchase of Shares of the New Class, based upon the then current issue and repurchase prices of Shares in each Portfolio. The Articles allow for an exchange fee of up to 1% of the total issue price of the Shares of the New Class purchased to be charged, and the Directors reserve the right to impose such a fee. Details of such fees in respect of each Portfolio are set out in the Supplement for the relevant Portfolio. Issue and Repurchase Prices / Calculation of Net Asset Value / Valuation of Assets The initial issue price for Shares of each Portfolio shall be the amount(s) set out in the relevant Supplement. The issue price at which Shares of any Portfolio will be issued on a Dealing Day, after the initial issue, is calculated by ascertaining the Net Asset Value of the relevant Portfolio as at the Valuation Point for that Portfolio for the relevant Dealing Day. The Net Asset Value per Share of the relevant Portfolio is calculated by dividing the Net Asset Value of the relevant Portfolio, by the total number of Shares in issue in the Portfolio at the relevant Valuation Point and rounding the result to two decimal places. Where applicable, the Net Asset Value per Share of each class in a Portfolio is calculated by determining that portion of the Net Asset Value of the Portfolio which is attributable to the relevant class and by dividing this sum by the total number of Shares of the relevant class in issue at the relevant Valuation Point and rounding the resulting amount to two decimal places. If a Portfolio has more than one class of Share, additional fees may be charged against certain classes, and details of such fees will be set forth in the Supplement for the relevant Portfolio. This may result in the Net Asset Value per Share of each class being different. The Valuation Point for each Portfolio is set out in the relevant Supplement. The price at which Shares will be issued on a Dealing Day is subject as hereinafter provided the Net Asset Value per Share of the relevant class which is calculated in the manner described above. The Company may, in calculating the issue price, include in the issue price in respect of each Portfolio, for its own account, a charge sufficient to cover stamp duties and taxation (if any) in respect of the issue of Shares or certificates and delivery and insurance costs in respect of certificates. The Company may also add a charge in respect of fiscal and purchase charges on investments. Applicants may also be charged a preliminary charge as specified in the relevant Supplement. 23