Insinger de Beaufort Equity Income Fund ("Fund D") (Share series Fund D) Supplementary prospectus June 2011

Transcription

1 Insinger de Beaufort Equity Income Fund ("Fund D") (Share series Fund D) Supplementary prospectus June 2011 This is an English translation of the official Dutch prospectus. Should there be any inconsistencies between this translated version and the Dutch version, then the terms of the Dutch version will prevail.

2 Contents page I. Important information 3 A. Introduction 3 B. General 3 C. Investment policy and objects 3 II. Capital 4 III. Investment risks 4 A. General 4 B. Market risk 4 C. Portfolio risk 4 D. Currency risk 5 E. Liquidity risk 5 F. Counterparty risk 5 G. Settlement risk 5 H. Custody risk 5 I. Concentration risk 5 J. Inflation risk 5 K. Inflexibility risk 6 L. Risk of amended legislation 6 M. Ring-fenced equity 6 IV. Fees 6 A. Management fee 6 B. Performance fee 6 V. Charges 6 A. General 6 B. Custodian bank and Custodian bank charges 7 C. TMF FundAdministrators B.V. charges 8 D. Company charges 8 E. Fund D charges 8 F. Transaction fees 8 G. Securities Lending fees 9 H. Total charges 9 I. Charges for issuing and repurchasing Fund D shares 9 J. Charges related to the average net asset value 9 VI. Returns and Balance Sheet total for Fund D and rebate commissions 10 A. Returns 10 B. Balance Sheet Total 11 C. Rebate commissions 11

3 03 03 I. Important information A. Introduction This Supplementary Prospectus should be read in conjunction with the Base Prospectus of Insinger de Beaufort Umbrella Fund N.V. (hereinafter referred to as the Company ). The Base prospectus and its appendices, this Supplementary Prospectus and the other Supplementary Prospectuses together form the Company s overall prospectus. Unless expressly stated to the contrary, the terms used in this Supplementary Prospectus have the same meaning as assigned to them in the Base Prospectus. B.. General Following the takeover of GIM Algemeen Vermogensbeheer B.V. by the Insinger de Beaufort group in 1999, the name GIM Umbrella Fund N.V. was changed to Insinger de Beaufort Umbrella Fund N.V. by an amendment to the articles of association on 21 March On 31 July 1997, the private investment funds GIM Global Real Estate Fund and GIM Capital Growth Fund, which had been independent until that time, were absorbed by the then GIM Umbrella Fund N.V., and the Fund C and Fund D series of shares were issued. Fund C corresponds to the former GIM Real Estate Equity Fund, now called Insinger de Beaufort Real Estate Equity Fund, while Fund D corresponds to the former GIM World Equity Fund, now called Insinger de Beaufort Equity Income Fund. On 30 December, 2005, Insinger de Beaufort Multi-Manager European Equity N.V. ( IdB European Equity ) merged into the Fund. In the context of this merger, the management designated the original shares in IdB European Equity as Fund D shares. Following the merger, the original shareholders of IdB European Equity became entitled to an equal number of series of shares in Fund D as specified in the exchange ratio set for that purpose. C. Investment policy and objects Fund D invests its capital in securities of listed companies worldwide, with the emphasis on European companies. Fund D may also invest in fixed-income securities and liquid assets if it can be expected that these investment instruments will perform better than shares. The mixed international character of investments of Fund D minimizes the investment risks without this having an adverse effect on the Fund s potential return. Derived investment instruments such as options and futures can serve to limit exchange rate risks and lead to extra returns. Aside from capital growth, Fund D s objective is to generate significant revenue. Fund D s capital will be invested with due observance of the policy set out below: investments are made in securities and options officially listed on generally recognised stock exchanges, as well as fixed-income securities and convertibles issued by companies whose shares are listed on those stock exchanges or by governments; investments may also be made in index options and futures;

4 the value of Fund D s investments in securities issued by one company may, at the time of purchase, not exceed 5% of the outstanding share capital of the issuing company and may not exceed 10% of the capital of Fund D; As stated above, Fund D can maintain unlimited liquid assets, but only for short periods. Fund D is not normally permitted to take out loans. The Fund is however, permitted to take out a temporary overdraft for the purchase and sale of shares in Fund D, where delays can occur between receipt and payment owing to certain settlement periods. Fund D does not invest directly or indirectly in other investment funds. II. Capital The Fund s issued capital comprises 5,000,000 ordinary shares (with a nominal value of 12,500,000) in Fund D of a total of 12,900,000 ordinary shares. III. Investment risks A. General The value of the investments can either increase or decrease. It is possible that the returns to holders of shares in Fund D will be less than the amount invested. No guarantee is given that the amount invested in Fund D or paid for shares in Fund D will be recouped. The investment risks described below can affect the price and the value of the investments and cause the net asset value (in Euros) of a share in Fund D to decrease. Specific risks that could influence investments in shares in Fund D are described in detail below. B. Market risk Fund D is subject to fluctuations in financial markets and the price of shares in Fund D can fluctuate accordingly. The share prices can fall worldwide or on stock exchanges in Europe. A careful selection and spread of the investments is no guarantee for positive or relatively good results. To hedge market risks, the Fund can use derivatives, such as buying put options and put warrants on the index, buying put options on individual securities and selling index forward contracts. However, no guarantee can be given that these techniques will always be used to the best possible effect. C. Portfolio risk The price levels of shares in one or more enterprises and other securities issued by individual companies, such as bonds, may decline as a result of circumstances specific to those companies. To hedge the risks from individual prices, the Fund can use derivatives, such as buying put options on individual securities. It is also permitted to take a short position on individual shares for risk management purposes related to Fund D. It is not however, possible to guarantee that these strategies will be optimally applied.

5 D. Currency risk The value of an investment can be affected by fluctuations in the foreign exchange rate. The price level of the Euro can rise relative to other currencies in which the price of an investment is expressed. Currency risks can be hedged by using currency forward transactions and currency options. However, no guarantee can be given that these techniques will always be used to the best possible effect. E. Liquidity risk It is possible that a position taken for the benefit of Fund D cannot be liquidated in time at a reasonable price due to a lack of cash in the market, in the context of supply and demand. F. Counterparty risk An issuing institution or a counterparty can remain in default. For acquisitions and disposals, only current receivables will generally arise so that the risk is low, because transfers take place against (virtually) simultaneous receipt of the consideration. G. Settlement risk Settlement via a payment system cannot take place as expected because the payment or transfer of the financial instruments by a counterparty does not take place at all or not in time or not as expected. H. Custody risk The loss of assets given in custody can arise as a result of insolvency, negligence or fraudulent activities by the custodian or by a sub-custodian. I. Concentration risk By investing primarily in securities of listed companies, but with an emphasis on European companies, investors run the risk that is associated with a large concentration of investments of that type and in that market. J. Inflation risk Fund D s investments are not intended to provide protection against inflation.

6 K. Inflexibility risk As Fund D is an open-ended investment company, it can in theory suddenly be confronted with a large number of redemptions, necessitating the urgent sale of investments in order to meet the repayment obligation to the redeeming shareholders. This can have an adverse effect on Fund D s results. L. Risk of amended legislation Financial and fiscal legislation is subject to amendment. Financial and fiscal advantages that existed when the investment was made can be amended to the detriment of a shareholder. M. Ring-fenced equity The equity in Fund D is not partitioned in legal terms from the equity in the Company's other sub-funds. Negative equity in another sub-fund can be apportioned over the equity of Fund D. IV. Fees A. Management fee The Manager receives an annual fee of 1% for managing Fund D s capital. The management fee is calculated daily (every Dutch trading day) as a percentage of the net asset value of Fund D at month-end and is charged monthly in arrears. B. Performance fee In addition to the management fee, Fund D also pays the fund manager a performance fee of 15% on the absolute positive return achieved by Fund D (based on the net asset value per share including dividend). The performance fee is calculated daily and included in the calculation of Fund D s net asset value. If a performance fee is payable on the last day of a calendar month, then it is paid out monthly. Once the performance fee has been paid, the performance fee will be reset to zero. This is not the case if a performance fee is not paid. Once paid, performance fees cannot be claimed back in the event of any negative returns in the future. On 1 July 2003, the basis for the calculation of the performance fee was set to zero. The reason for this was a change in the pursued investment strategy that was implemented at the same time as the modifications to the prospectus of 1 January Past negative results thus lapsed for the calculation of the performance fee. V. Charges A. General After being corrected for inflation and notwithstanding exceptional circumstances, all of the charges specified below for 2010 include VAT and are expected to remain more or less the same in the financial years to follow.

7 07 07 This does not include the performance fee, with respect to which a reference is made to the information provided in this regard above. This does not however constitute a guarantee that the costs in 2011 or subsequent financial years will not be (substantially) higher as they are beyond the control of the Fund and the Manager, and where they are within the control of the Fund or the Manager, they can take decisions in the interest of the Fund and Fund D s shareholders that can cause the costs to increase. The charges stipulated in this section will be increased by the payable turnover tax unless a statement is made to the contrary. The costs actually incurred will be shown in the Company s financial statements and semi-annual reports. B. Custodian bank and Custodian bank charges The custodian bank for Fund D is Bank Insinger de Beaufort N.V. (the "Custodian bank"). The custodian bank s address is Herengracht 537, 1017 BV Amsterdam. There is no separate contract between the Custodian bank and Fund D. The General Banking Terms are applicable to the legal relationship between Fund D and the Custodian bank. The Custodian Bank charges the following rates for its services, calculated on the total portfolio on 31 December of each previous year: up to EUR 45, %* over the additional amount up to EUR 225, %* on additional sums up to EUR 2,275, %* exceeding EUR 2,275, %* Line tariff for each type of fund EUR 1.59** * 30% surcharge is payable for securities kept in custody abroad. **A line tariff for each fund type of EUR 3.18 instead of EUR 1.59 is charged for securities kept in custody abroad. These charges do not include VAT or other commissions for services such as collecting dividends and settling transactions. No custody fee is charged for investments of Fund D in other funds managed by the Investment Manager. Other than the charges specified above, Fund D is not charged for giving the assets of Fund D into custody.

8 C. Charges of TMF FundAdministrators B.V. (the "Administrator") The Administrator charges a fixed fee for its services. This fee can fluctuate annually in response to inflation and additional working hours. In 2010 the amount paid Fund D for these services was: EUR 52,100 (by way of comparison: in 2009 these charges were EUR 52,000). D. Company charges Charges and expenses the Company incurs that are not specifically attributable to a Fund are passed on to all Funds with outstanding shares in proportion to the net asset value of the Funds on the last trading day of the month when the charges and expenses were incurred. Charges and expenses of the Company that are not specifically attributable to a Fund include the charges set out below, stating the most significant amounts for 2010: external supervision fees : zero (by way of comparison: in 2009 these charges were EUR 3,109); external legal consultants fees: EUR 3,609 (by way of comparison: in 2009 these charges were EUR 2,471); publications, notices convening meetings, notifications fees: see marketing costs per Fund; general meetings of the Company s shareholders fees: zero. E. Fund D charges The charges specified below are charged directly to Fund D s capital; the amounts below are the amounts for the most significant costs for 2010: management fees (including the performance fee). EUR 806,004 (by way of comparison: in 2009 these charges were EUR 889,620); external auditor and tax consultants fees: EUR 36,233 (by way of comparison: in 2009 these charges were EUR 13,320); marketing fees Fund D: EUR 8,583 (by way of comparison: in 2009 these charges were EUR 12,700); charges of the Custodian bank for its services: EUR 62,332 (by way of comparison: in 2009 these charges were EUR 74,829); Exchange listing fees: EUR 2,500 (by way of comparison: in 2009 these charges were EUR 4,700). F. Transaction costs Charges relating to the purchase and sale of assets (transaction costs) can include taxes, brokerage fees, spreads between bid and offer prices and the change to the market price precipitated by the transaction. The transaction charges cannot always be estimated with sufficient accuracy. The transaction costs for some securities are included in the (gross) price. Furthermore, changes to the market price caused by a transaction are difficult to ascertain. The basic standard applied to transaction charges is that they must be marketcompliant. The purchase charges form part of the acquisition price of the securities and, if valued at market value, they are included in the unrealised share prices. Sales costs are accounted for in the realised share prices.

9 G. Securities Lending fees Fund D does not lend any securities and therefore does not incur any Securities Lending fees (this also applies to 2009). H. Total charges The total amount of all of the costs listed above that are payable by Fund D amount to EUR 971,361 (by way of comparison: this amount was EUR 1,052,749 in 2009). It should be noted that these are the most significant charges borne by Fund D, but are not all of them. All of the charges payable by Fund D will be stated in the Company s notes to the balance sheet and profit and loss account. I. Charges for issuing and repurchasing Fund D shares The issue price and repurchase price for the issue and repurchase of shares in Fund D s own capital will be equal to the net asset value of the shares on the date of issue/repurchase, plus a maximum surcharge if Fund D must issue shares on that day, or a deduction if Fund D must repurchase shares on that day, both surcharges are determined by the Investment Manager (transaction price). The Investment Manager bases the calculation of the surcharge or deduction on the average costs incurred for the repurchase or issue. This surcharge or deduction covers the average long-term transaction costs incurred by Fund D for the repurchase or issue of transaction costs in the long term for the purchase or issue of its own shares. The amount is based on the actual purchase and sale charges relating to the securities in which Fund D invests, and can vary between 0% and 0.40% of the net asset value. The Investment Manager publishes the current surcharge or deduction on its website. The Investment Manager can adjust this percentage if this longterm average changes as a result of market conditions. The result of this surcharge or deduction is fully credited to or debited from Fund D so that the purchase and selling charges of the underlying securities can be met. This protects current investors against the costs incurred by Fund D for issuing or redeeming its own shares. If equity is contributed to Fund D via the Insinger Investment Account, the conditions of the Insinger Investment Account are applicable (see section XI under E of the Base Prospectus). Apart from the surcharge or deduction calculated by the Investment Manager, the Insinger Investment Account can charge shareholders for the purchase of shares in Fund D that are payable to the Investment Manager. For the sake of completeness, it should be noted that this contribution is not charged upon admission via Euronext. Fund D will repurchase or issue shares in its own capital at a price equal to the transaction price. J. Charges related to the average net asset value Shown below are the charges (Total Expense Ratio) of Fund D per financial year which are related to its average net asset value in that financial year.

10 10 10 Excluding performance fee Including performance fee % 1.20% % 1.18% 2008: 1.17% 1.17% 2007: 1.34% 2.38% 2006: 1.13% 3.58% 5% 3,58% 2,38% 1,13% 1,34% 1,17% 1,17% 1,18% 1,18% 1,20% 1,20% 0% Totale Expense Ratio TER excluding performance fees TER including performance fees VI. Fund D returns and rebate commissions A. Returns Fund D s returns since 2006 are as follows: % % 2008: -/ % 2007: -/- 2.22% 2006: 13.99% 30% 20% 10% 13,99% 18,12% 5,05% 0% -10% -2,22% -20% -30% -40% -30,11% Performance (per year)

11 11 11 B. Balance Sheet Total Since 2006, Fund D s balance sheet total (x EUR 1 million) has been the following: : : : ,2 167,3 180,0 160,0 140,0 103,5 95,0 74,0 120,0 100,0 80,0 EUR mln 60,0 40,0 20, Balance Sheet Total (year-end) 0,0 A comparison of how Fund D s capital and its revenues and expenses have developed over the past three years is shown in the financial statements for the past three financial years, including the reports relating to those three financial statements and the most recent semi-annual figures. Those documents are available to the public, free of charge, at the Company s office address and are also published on the Company s website. These documents have been attached to the Base Prospectus as Appendix E. Each new semi-annual report will supersede the previous semi-annual report in Appendix E to the Base Prospectus. Furthermore, each new financial statement for the Company with the accompanying auditor s report will supersede the financial statements of the Company with the accompanying auditor s report for the previous four financial years. A fully updated Appendix E will remain available at all times at the Company s offices (see section VI ( Notifications ) above) for investors who do not yet have a copy. C. Rebate commissions As at the date of this Supplementary Prospectus, no agreements have been made with the Investment Manager or the Company concerning rebate commissions or goods that are received by the Manager or the directors of the Manager or the Company or are offered to them for the performance of assignments for the Manager or the Company. Any rebate commissions which arise will be payable in full to the Investment Manager.