HSBC Corporate Money Funds Limited. Prospectus

Transcription

1 HSBC Corporate Money Funds Limited Prospectus

2 This document is important: If you are in any doubt about the contents of this document you should consult your stockbroker, bank manager, lawyer, accountant or other professional adviser. The distribution of this document and the offering of Shares in certain jurisdictions may be restricted and accordingly persons into whose possession this document comes are required by HSBC Corporate Money Funds Limited (the Company ) to inform themselves about, and to observe, such restrictions. This document does not constitute an offer or solicitation to anyone in any jurisdiction in which such offer is not authorised or to any person to whom it is unlawful to make such offer or solicitation. The Shares are offered on the basis of the information and representations contained in this document and any further information given or representations made by any person may not be relied upon as having been authorised by the Company or its Directors. Neither the delivery of this document nor the allotment or issue of Shares shall under any circumstances create any implication that the information given in this document is correct as of any time subsequent to the date of this document. The Company has been authorised as a Bermuda Standard Fund. As such, the Company is subject to regulation and supervision as provided for in the Investment Funds Act However, the Company should be viewed as an investment suitable only for investors who can fully evaluate and bear the risks involved. Permission under the Exchange Control Act, 1972 (and Regulations made thereunder) has been obtained from the Bermuda Monetary Authority for the issue of up to 19,999,880,000 common shares of US$0.10 par value each. Approvals or permissions received from the Bermuda Monetary Authority do not constitute a guarantee by the Authority as to the performance of the scheme or creditworthiness of the Company. Furthermore, in giving such approvals or permission, the Authority shall not be liable for the performance or default of the Company or for the correctness of any opinions or statements expressed. In addition, a copy of this document has been delivered to the Registrar of Companies in Bermuda for filing pursuant to The Companies Act, 1981 of Bermuda. In accepting this document for filing, the Registrar of Companies in Bermuda accepts no responsibility for the financial soundness of any proposal or for the correctness of any of the statements made or opinions expressed with regard to them. The Shares of the Company, issued or to be issued, have been listed on The Bermuda Stock Exchange. It is not anticipated, at the time, that the Shares will be listed on any other stock exchange. This document includes particulars given in compliance with the Listing Regulations of The Bermuda Stock Exchange for the purpose of giving information with regard to the Company. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this document and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief there are no other facts the omission of which would make any statement herein misleading. The Bermuda Stock Exchange takes no responsibility for the contents of this document, makes no representations as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon any part of the contents of this document. The Shares have not been registered under any United States securities laws and, except in a transaction which does not violate the United States securities laws, may not be directly or indirectly offered or sold in the United States of America, or any of its territories or possessions or areas subject to its jurisdiction, or to or for the benefit of a US Person. For the purposes of this restriction, the term US Person shall have the meaning as set out in the definition of US Person. RESTRICTIONS ON OFFERS AND SALES TO CANADIAN RESIDENTS The Shares described in this prospectus may only be distributed in Canada through HSBC Global Asset Management (Canada) Limited, and this prospectus may not be used to solicit, and will not constitute a solicitation of, an offer to buy Shares in Canada unless such solicitation is made by HSBC Global Asset management (Canada) Limited. A distribution or solicitation is made to a person (including an individual, corporation, trust, partnership or other entity, or other legal person) resident or otherwise located in Canada HSBC Corporate Money Funds Limited - 2 -

3 at the applicable time. For these purposes a Canadian resident is as set out in the definition of Canadian Resident. The Company is not a recognised collective investment scheme under any United Kingdom financial services laws and, as such, Shares of the Company may not be offered or sold in the United Kingdom by means of this document except to persons authorised to carry on investment business under such laws, persons whose ordinary business involves the acquisition or disposal of investments similar to those of the Company and otherwise persons permitted to receive this document under such laws. 28 February 2014 HSBC Corporate Money Funds Limited - 3 -

4 Contents 1.0 Directory Directors & Officers Secretary & Registered Office Manager Custodian Banker Administrator Auditors Legal Advisers Bermuda Stock Exchange Listing Sponsor Summary Offers Investment Objective Issue of Shares Transfer of Shares Redemption of Shares Compulsory Redemption Special Redemption Dividend Policy Definitions Introduction Investment Objectives & Policies Investment Restrictions The Sweep Facility Risk Factors Dividend Policy Management & Administration Directors Manager Custodian Administrator Issue of Shares Anti-Money Laundering Transfer of Shares Redemption of Shares Compulsory Redemption Special Redemption Charges & Expenses Manager, Custodian & Administrator Directors Other Expenses Taxation Foreign Account Tax Compliance Act Bermuda Other Jurisdictions HSBC Corporate Money Funds Limited - 4 -

5 8.0 General Information Calculation of Net Asset Value... & Subscription & Redemption Prices Allocation of Assets & Liabilities Between Funds Suspension of Valuations & Dealings Change of Capital Variation of Class Rights Voting Rights Directors Restrictions on Shareholders Indemnities Dividends Contracts Miscellaneous Inspection of Documents Procedure for Application Distribution of this document is not authorised unless it is accompanied by a copy of the latest audited financial statements of the Company, if any, which form part of the Prospectus. The Funds are managed by HSBC Global Asset Management (Bermuda) Limited (AMBM) of 6 Front Street, Hamilton, Bermuda, a wholly owned subsidiary of HSBC Bank Bermuda Limited (the Bank). Both AMBM and the Bank are licensed to conduct investment business by the Bermuda Monetary Authority. The Funds are offered by Prospectus only in those jurisdictions where they are permitted by law. Persons are required to inform themselves about and observe any relevant restrictions. Past performance may not be indicative of future results. Investors should note that the use of derivatives and investments involving a currency other than their own will create foreign exchange exposure, which involves special risks. It is the aim of the Company to preserve capital and, where applicable, to maintain a stable net asset value per share; these aims are not guaranteed. Additionally, investors should consider whether or not they can assume these risks and should undertake their own appropriate professional advice. HSBC Corporate Money Funds Limited - 5 -

6 1.0 Directory 1.1 Directors & Officers L Anthony Joaquin (President) Retired Managing Partner Ernst & Young Flamingo Cliff, 8 St Patrick s Road Smiths FL 05, Bermuda Faith A. Outerbridge (Vice President) Head of Global Asset Management Bermuda HSBC Bank Bermuda Limited 6 Front Street Hamilton HM 11, Bermuda Wayne P. Chapman Head of Private Banking Bermuda HSBC Bank Bermuda Limited 6 Front Street Hamilton HM 11, Bermuda Julie E. McLean Director Conyers Dill & Pearman Limited Clarendon House 2 Church Street Hamilton HM 11, Bermuda 1.2 Secretary & Registered Office HSBC Securities Services (Bermuda) Limited 6 Front Street Hamilton HM 11, Bermuda 1.3 Manager HSBC Global Asset Management (Bermuda) Limited 6 Front Street Hamilton HM 11, Bermuda Telephone: Facsimile: asset.management@hsbc.bm 1.4 Custodian HSBC Institutional Trust Services (Bermuda) Limited 6 Front Street Hamilton HM 11, Bermuda 1.5 Banker HSBC Bank Bermuda Limited 6 Front Street Hamilton HM 11, Bermuda HSBC Corporate Money Funds Limited - 6 -

7 1.6 Administrator HSBC Securities Services (Bermuda) Limited 6 Front Street Hamilton HM 11, Bermuda Telephone: Facsimile: ifs.investor.services@us.hsbc.com 1.7 Auditors KPMG Audit Limited Crown House, 4 Par-la-Ville Road Hamilton HM 08, Bermuda 1.8 Legal Advisers Conyers Dill & Pearman Limited Clarendon House 2 Church Street Hamilton HM 11, Bermuda 1.9 Bermuda Stock Exchange Listing Sponsor Bermuda International Securities Limited 6 Front Street Hamilton HM 11, Bermuda HSBC Corporate Money Funds Limited - 7 -

8 2.0 Summary 2.1 Offers 19,999,880,000 common shares of various classes with a par value of US$0.10 each (the Shares ) at prices based upon the Net Asset Value per Share. HSBC Corporate Money Funds Limited (the Company ), formerly All Points Corporate Money Funds Limited, has been incorporated in Bermuda as an exempted mutual fund company to carry on the business of a mutual fund company and, as such, has the power to issue and redeem its Shares at their net asset value as calculated in the manner described herein. The Shares of the Company are divided into several Classes, one or more of which relates to a Fund within the Company. The current Classes of Shares are US Dollar Fund - A Shares ( Class A - USD ), US Dollar Fund - B Shares ( Class B - USD ), US Dollar Fund - C Shares ("Class C - USD"), US Dollar Fund - I Shares ("Class I - USD") and US Dollar Fund - R Shares ("Class R - USD"), all of which relate to the same Fund, namely the US Dollar Fund; Sterling Fund - A Shares ( Class A - GBP ), Sterling Fund - B Shares ( Class B - GBP ), Sterling Fund - I Shares ( Class I - GBP ) and Sterling Fund - R Shares ( Class R - GBP ) all of which relate to the same Fund, namely the Sterling Fund; Euro Fund - A Shares ( Class A - EUR ), Euro Fund - B Shares ( Class B - EUR ), Euro Fund - I Shares ( Class I - EUR ) and Euro Fund - R Shares ( Class R - EUR ) all of which relate to the same Fund, namely the Euro Fund; Canadian Dollar Fund-A Shares ( Class A- CAD ), Canadian Dollar Fund- B Shares ( Class B- CAD ), Canadian Dollar Fund- I Shares ( Class I- CAD ) and Canadian Dollar Fund- R Shares ("Class R - CAD") all of which relate to a Fund, namely the Canadian Dollar Fund; and US Treasury Fund A Shares ( Class A UST ), US Treasury Fund B Shares ( Class B UST ), US Treasury Fund C Shares ( Class C UST ) and US Treasury Fund I Shares ( Class I UST ), all of which relate to the same Fund, namely the US Treasury Fund. The Base Currency of the US Dollar Fund has been designated as US dollars and, as such, will be valued, the Shares related thereto priced and dividends paid in US dollars; the Base Currency of the Sterling Fund has been designated as sterling and, as such, will be valued, the Shares related thereto priced and dividends paid in sterling; the Base Currency of the Euro Fund has been designated as euro and, as such, will be valued, the Shares related thereto priced and dividends paid in euro; the Base Currency of the Canadian Dollar Fund has been designated as Canadian dollars and, as such, will be valued, the Shares related thereto priced and dividends paid in Canadian dollars and the Base Currency of the US Treasury Fund has been designated as US Dollars and, as such, will be valued, the Shares related thereto priced and dividends paid in US Dollars. 2.2 Investment Objective The principal objective of the Company is to achieve as high a level of current income as is consistent with the preservation of capital and the maintenance of liquidity by investing in a diversified portfolio of money market instruments. 2.3 Issue of Shares Investors must meet the Company s suitability and eligibility criteria as may be determined by the Manager from time to time and all subscriptions are subject to rejection or acceptance in whole or in part by the Manager, in its sole discretion, even if such person meets such suitability or eligibility requirements. The Shares of the US Dollar Fund, Sterling Fund, Euro Fund, Canadian Dollar Fund and US Treasury Fund are available for subscription pursuant to this Prospectus on each Dealing Day. A placing fee of up to 0.10% of the aggregate subscription amount may be payable to the Manager or designated distribution agent by applicants on the issue of US Dollar Fund - C Shares and US Treasury Fund- C Shares. Shares are issued at a Subscription Price based upon the Net Asset Value per Share of the relevant Class. Although the Company cannot guarantee these results, the Company will seek to maintain a constant Net Asset Value per Share of: HSBC Corporate Money Funds Limited - 8 -

9 US$1.00 for Shares in Classes A, B, C and I of the US Dollar Fund; US$1.00 for Shares in Classes A, B, C and I of the US Treasury Fund; 1.00 for Shares in Classes A, B and I of the Sterling Fund; 1.00 for Shares in Classes A, B and I of the Euro Fund; and CA$1.00 for Shares in Classes A, B and I of the Canadian Dollar Fund The Subscription Price is payable in cleared funds, in full, on the Dealing Day for Shares of the US Dollar Fund and US Treasury Fund and on the Business Day immediately following the Dealing Day for Shares of the Sterling Fund, Euro Fund and Canadian Dollar Fund. Subject to the Manager s sole and absolute discretion in any particular case or generally, the minimum initial subscription and the minimum amount for subsequent transactions for Shares are as follows: Class Initial Subsequent Class A US$/ / /CA$1,000,000 US$/ / /CA$25,000 Class B US$/ / /CA$25,000 US$/ / /CA$10,000 Class C US$100,000,000 US$10,000,000 Class I US$/ / /CA$50,000,000 US$/ / /CA$1,000,000 Class R US$/ / /CA$10,000 US$/ / /CA$1,000 e.g. Initial investment in Class R of the Sterling Fund is 10,000 and subsequent investment is 1,000. The minimum initial subscription amount for each Class of Shares in each Fund is hereinafter referred to as the Minimum Holding. The minimum amount for subsequent transactions for each Class of Shares is hereinafter referred to as the "Minimum Transaction Amount". The Manager is entitled in its absolute discretion from time to time to accept or reject any application for any Shares. 2.4 Transfer of Shares Shares in the Company are transferable by instrument in writing signed by the transferor provided that it would not result in either the transferor or the transferee being registered as the holder of Shares of any Class having a value of less than the Minimum Holding, subject to the Manager s sole and absolute discretion, in any particular case or generally, of the relevant Class of Shares. 2.5 Redemption of Shares Shares are redeemable at the option of the holder on any Dealing Day at a Redemption Price based upon the Net Asset Value per Share of the relevant Class. Redemption of part of a holding of Shares is also permitted provided it would not be for less than the Minimum Transaction Amount and would not result in a shareholder remaining registered as a holder of Shares having a value of less than the Minimum Holding, subject to the Manager s sole and absolute discretion in any particular case or generally, of the relevant Class of Shares. A Redemption Fee of up to 3% of the Net Asset Value per Share may, at the discretion of the Directors, be deducted from the redemption proceeds on any Dealing Day in exceptional circumstances, for further details please refer to the Redemption of Shares section. 2.6 Compulsory Redemption Shares are subject to compulsory redemption at any time for any reason, in the sole and absolute discretion of the Directors and upon not less than 30 days written notice to shareholders. 2.7 Special Redemption Shares of each of the Distributing Share Classes are subject to compulsory redemption automatically as at any Dealing Day, from time to time in the sole and absolute discretion of the Directors, where the applicable Distributing Share Class has suffered a Negative Yield (as defined below). Shares of a Distributing Share Class affected by a Negative Yield event will be redeemed pro-rata across all HSBC Corporate Money Funds Limited - 9 -

10 shareholders in the applicable Class. The proceeds of such Special Redemption will be retained by the Company and will be applied to discharge the applicable shareholder s pro-rata share of such Negative Yield. Shareholders subject to a Special Redemption will have no right to receive the proceeds of such Special Redemption and will cease to have any rights with respect to the Shares so redeemed after the close of business on the relevant Dealing Day as of which the Special Redemption is effected 2.8 Dividend Policy It is the intention of the Directors to declare dividends for each Class of Shares of each Fund, except the Class R Shares, on each Dealing Day which will be paid monthly and will be automatically reinvested in the form of additional Shares of the same Class unless the shareholder elects for payment in cash. Shareholders shall be entitled to dividends from the Dealing Day on which Shares are issued until the day preceding the Dealing Day on which Shares are redeemed. Dividends declared in relation to Class A Shares, Class B Shares, Class C Shares and Class I Shares in each Fund will vary to the extent that the management fees applicable to each Class differ. Additionally, dividends may be declared at a different rate for each Fund. With respect to the Class R Shares, shareholders do not receive dividends since their share of income or profits are accumulated and reflected in the daily Net Asset Value per Share. The details on pages 8 to 10 are in summary form only and must be read in conjunction with the detailed information in this Prospectus. 3.0 Definitions "Accumulating Share Class" means any Class of Shares which does not receive dividends and whose share of income or profits are accumulated and reflected in the daily Net Asset Value per Share." Administrator means HSBC Securities Services (Bermuda) Limited. Bank means HSBC Bank Bermuda Limited Base Currency means, with respect to each Fund, the currency in which the assets of the relevant Fund shall be valued and in which the Net Asset Value per Share, the Subscription Price and the Redemption Price is determined and dividends paid and, unless the Directors specify to the contrary, the Base Currency shall be US dollars for the US Dollar Fund and US Treasury Fund, sterling for the Sterling Fund, euro for the Euro Fund and Canadian dollars for the Canadian Dollar Fund. Business Day means a day on which the banks in Bermuda and the Federal Reserve banks in the United States and, where applicable, banks in the jurisdiction of the Base Currency of the relevant Fund are open for business and/or any other day or days which the Manager may determine from time to time. Bye-laws means the Bye-laws of the Company. Canadian Resident means: 1. An individual, if i. the individual s primary principal residence is located in Canada; or ii. the individual is physically located in Canada at the time of the offer, sale or other relevant activity. 2. A corporation, if i. the corporation s head office or principal office is located in Canada; or HSBC Corporate Money Funds Limited

11 ii. iii. securities of the corporation that entitle the holder to elect a majority of the directors are held by Canadian Resident individuals (as described above) or by legal persons resident or otherwise located in Canada; or the individuals that make investment decisions or provide instructions on behalf of the corporation are Canadian Resident individuals (as described above). 3. A trust, if i. the principal office of the trust (if any) is located in Canada; or ii. iii. the trustee (or in the case of multiple trustees, the majority of trustees) are Canadian Resident individuals (as described above) or are legal persons resident or otherwise located in Canada; or the individuals that make investment decisions or provide instructions on behalf of the trust are Canadian Resident individuals (as described above). 4. A partnership, if i. the partnership s head office or principal office (if any) is located in Canada; or ii. iii. iv. the holders of the majority of the interests of or in the partnership are held by Canadian Residents (as described above); or the general partner (if any) is a Canadian Resident (as described above); or the individuals that make investment decisions or provide instructions on behalf of the partnership are Canadian Resident individuals (as described above). Class means a sub-division of the share capital of the Company into classes of Shares, one or more of which may participate in a separate portfolio of assets. Custodian means HSBC Institutional Trust Services (Bermuda) Limited. Dealing Day means the day on which issues and redemptions of Shares take place, being each day which is a Business Day and/or such other day or days as may from time to time be determined by the Manager. Director means a Director of the Company. Distributing Share Class means any Class of Shares which may receive dividends from time to time, and whose share of income and profits may be distributed in accordance with the Company s Bye-laws and this Prospectus. Fund means a fund established and maintained by the Company in connection with one or more Class(es) of Shares created for issue and within which all assets and liabilities attributable to the relevant Class or Classes of Shares shall be held. Manager means HSBC Global Asset Management (Bermuda) Limited. Minimum Holding means the minimum initial subscription amount for each Class of Shares in the capital of the Company in each Fund as specified on page 22 or such other minimum initial subscription amount as the Manager may determine from time to time in any particular case or generally. HSBC Corporate Money Funds Limited

12 "Minimum Transaction Amount" means the minimum amount for subsequent transactions for each Class of Shares in the capital of the Company in each Fund as specified on page 22 or such other minimum subsequent transaction amount as the Manager may determine from time to time in any particular case or generally. Negative Net Yield means the Yield which is negative following the deduction of the charges and expenses payable in respect of the Shares of the relevant Distributing Share Class as at the Valuation Point for the relevant Dealing Day in respect of such Shares. Negative Gross Yield means in respect of Shares of a Distributing Share Class, the Yield which is negative before the deduction of the charges and expenses payable in respect of the Distributing Share Class as at the Valuation Point for the relevant Dealing Day in respect of such Share; Negative Yield means the Negative Net Yield or the Negative Gross Yield as applicable; Net Asset Value means the net asset value of the Company, the net asset value of a Fund, the net asset value of any Class of Shares within a Fund or the Net Asset Value per Share, as appropriate, calculated as described herein. Redemption Fee means a charge which may be deducted from the redemption proceeds of Shares, further details of which is set out in the Redemption of Shares section. Redemption Price means the Net Asset Value of the relevant Class within a Fund as at the Valuation Point on the relevant Dealing Day divided by the number of Shares of the relevant Class within that Fund in issue and rounded to the nearest integral unit of the Base Currency of the relevant Fund. Shares means common shares of any Class of a par value of US$0.10 each. Special Redemption means in the case of a Distributing Share Class, an automatic, pro-rata, compulsory redemption of Shares of any Class of a Distributing Share Class affected by the Company on any Dealing Day where such Class suffers a Negative Yield, as more particularly provided for in this Prospectus. Subscription Price means the Net Asset Value of the relevant Class within a Fund as at the Valuation Point on the relevant Dealing Day divided by the number of Shares of the relevant Class within that Fund in issue and rounded to the nearest integral unit of the Base Currency of the relevant Fund. US Person Shares of the Company may not be offered or sold to any U.S. Person (a USP ). For the purposes of this restriction, the term USP shall mean the following: 1. An individual who is deemed a resident of the U.S. under any U.S. law or regulation; 2. An entity: i. that is a corporation, partnership, limited liability company or other business entity: a. that was created or organised under U.S. federal or state law including any non- U.S. agency or branch of such entity; or b. where regardless of place of formation or organisation, was organised principally for passive investment (such as an investment company or fund or similar entity other than an employee benefit plan or employee pension scheme for the employees, officers, or principals of a non-u.s. entity having its principal place of business outside the United States); and owned directly or indirectly by one or more USPs, with respect to which such USPs (unless defined as a Qualified Eligible Person under CFTC Regulation 4.7(a)) directly or indirectly hold in the aggregate 10% or greater beneficial interest; or HSBC Corporate Money Funds Limited

13 where a USP is the general partner, managing member, managing director or other position with authority for directing the entity's activities; or was formed by or for a USP principally for the purpose of investing in securities not registered with the SEC; or where more than 50% of its voting ownership interests or non-voting ownership interests are directly or indirectly owned by USPs; or c. that is any agency or branch of a non-u.s. entity located in the U.S.; or d. has its principal place of business in the U.S.; or ii. that is a trust created or organised under U.S. federal or state law or regardless of the place of creation or organisation; a. where one or more USPs has the authority to control all substantial decisions of the trust; or b. where the administration of the trust or its formation documents are subject to the supervision of one or more U.S. courts: or c. where any settlor, founder, trustee, or other person responsible for decisions related to the trust is a USP; or iii. that is an estate of a deceased person regardless of where the person resided while alive where an executor or administrator is a USP. 3. An employee benefit plan established and administered in accordance with the laws of the U.S. 4. A discretionary or non-discretionary investment account or similar account (other than an estate or trust) held by a non-u.s. or U.S. dealer or other fiduciary for the benefit or account of a USP (as defined above). For the purpose of this definition, the United States and U.S. means the United States of America (including the States and the District of Columbia), its territories, possessions and other areas of subject to its jurisdiction. If, subsequent to a shareholder s investment in the Company, the shareholder becomes a USP, such shareholder (i) will be restricted from making any additional investments in the Company and (ii) as soon as practicable have its Shares compulsorily redeemed by the Company (subject to the requirements of applicable law). The Company may, from time to time, waive or modify the above restrictions. Valuation Point means 4:30 p.m. in New York on the Business Day immediately preceding a Dealing Day for Shares of the US Dollar Fund, 2:00 p.m. in New York on the Business Day immediately preceding a Dealing Day for Shares of the US Treasury Fund, 1:00 p.m. in Dublin on the Business Day immediately preceding a Dealing Day for Shares of the Sterling Fund, 1:30 p.m. in Dublin on the Business Day immediately preceding a Dealing Day for Shares of the Euro Fund and 1:00 p.m. in Dublin on the Business Day immediately preceding a Dealing Day for Shares of the Canadian Dollar or such other time or times as may be determined by the Directors. Yield means in respect of Shares of a Distributing Share Class, the percentage amount representing the net income and gains attributable to the applicable the Shares divided by the Net Asset Value of such Shares as at the Valuation Point for the relevant Dealing Day in respect of such Shares. HSBC Corporate Money Funds Limited

14 In this Prospectus, unless otherwise specified, all references to US dollars, US$ or USD are to the currency of the United States of America, all references to sterling, GBP and are to the currency of the United Kingdom, all references to euro, EUR and are to the currency introduced at the start of the third stage of the economic and monetary union pursuant to the Treaty of Rome dated 25th March, 1957 (as amended) establishing the European Community and all references to "Canadian dollars", "CA$" or "CAD" are to the currency of Canada 4.0 Introduction HSBC Corporate Money Funds Limited, formerly All Points Corporate Money Funds Limited, is a mutual fund company incorporated with limited liability and with unlimited duration in Bermuda on 4 December 1997 in accordance with The Companies Act The name of the Company was changed to HSBC Corporate Money Funds Limited on 31 December The Company was amalgamated with the HSBC Global Cash Funds Limited and continued as one under the name HSBC Corporate Money Funds Limited on 1 February The Company is open-ended in that it can issue and redeem its Shares at prices based upon their Net Asset Value per Share. The Company is managed by HSBC Global Asset Management (Bermuda) Limited, a wholly-owned subsidiary of HSBC Bank Bermuda Limited. The present authorised share capital of the Company is US$2,000,000,000 consisting of 12,000 founders shares of US$1.00 par value each and 19,999,880,000 common shares of US$0.10 par value each. The founders shares have been issued nil paid to, and are owned by, the Manager. The founders shares are not entitled to vote unless there are no other Shares in issue, are not entitled to any dividends and, in the event of a winding-up or of dissolution of the Company, whether voluntary or involuntary or for the purposes of a reorganisation or otherwise or upon distribution of capital, shall be entitled, pari passu with the holders of Shares, only to the amount paid up in respect of each founders share. The common shares have the rights and are issued and redeemed at prices described in this Prospectus. The Directors have the power at their discretion to create such number of Classes of Shares as they may determine. On the creation of a new Class or Classes of Shares, the Directors may either determine that such new Class or Classes shall relate to an existing Fund or Funds or may establish and maintain a Fund or Funds attributable to one or more such new Class or Classes of Shares and shall specify the Base Currency of such Fund or Funds. The assets of each separate segregated Fund are held exclusively for the benefit of the holders of Shares of the relevant Class(es). At present, the Company has available for issue Shares in the Classes described in this Prospectus, with the exception of Shares in the US Treasury Fund that, as of the date of this Prospectus, has not yet been launched. The Directors may, from time to time, determine when a Class is open or closed for subscription. The Company has the power to issue and redeem its Shares at prices based upon the value of the net assets attributable to the relevant Class of the underlying Fund. Details concerning issues and redemptions and the calculation of the applicable Subscription and Redemption Prices are set out on pages 20, 23, 25 and 28. The proceeds of issue of Shares of any Class or Classes are paid to the relevant Fund. Investments acquired are held by and all income and capital gains earned on the investments shall accrue to the relevant Class within the relevant Fund and all expenses and liabilities related to a particular Fund are charged to and any dividends or redemptions of Shares of any Class are paid out of the assets of the relevant Class within the relevant Fund. Thus, the trading results of any one Fund will have no effect on the value of any other Fund and the holders of any Class of Shares will not have any interest in the assets of the Company other than the HSBC Corporate Money Funds Limited

15 Fund attributable to the Class of Shares held by them. The assets of each Fund will, however, be subject to the rights of the general creditors of the Company. Shares of each Class are available for issue, subject as hereinafter provided, at the applicable Subscription Price per Share which will be payable by the applicants to the Company. Potential subscribers of Shares in the Company and any Class should inform themselves as to: 1) the possible tax consequences; 2) the legal requirements; and 3) any foreign exchange restrictions or exchange control requirements which they might encounter under the laws of the countries of their citizenship, residence or domicile and which might be relevant to the subscription, holding and disposal of Shares in the Company. 4.1 Investment Objectives & Policies The Company provides a vehicle for investment in cash and cash equivalents with the objective of providing as high a level of current income as is consistent with the preservation of capital and the maintenance of liquidity. The Company has obtained, and will endeavour to maintain, a "Triple A" rating from one of the two most recognised rating agencies, in respect of all of the Funds. The Directors will ensure that each of the Funds will invest in securities which are consistent with maintaining this rating. Money market funds rated "Triple A" are judged to be of an investment quality similar to "Triple A" rated fixed income obligations, that is, they are judged to be of the best quality. The rating is not intended to evaluate the performance of a Fund with respect to appreciation, volatility of net asset value or yield. The following credit portfolio requirements shall be maintained: All securities in a Fund will have a minimum short term rating of P-1 or A-1or higher, or a minimum long term rating of A2 or A or higher. For the securities with only a short term rating, a comparable long term rating will be applied, for the purposes of these limits: Long Term Rating Category Range Triple A 100% Double A 70% Single A 25% Maximum Operational Limits In assigning a long term rating, guarantees and full and partial support will be taken into consideration. Where ratings from the two largest rating agencies conflict, the lowest of the two ratings issued will apply. Downgrading of investments in the portfolio may result in a security's rating falling below the permitted minimum. Any security outside of these guidelines shall be approved by the Manager for holding. The US Dollar Fund will normally consist of cash and money market instruments denominated in US dollars. The Sterling Fund will normally consist of cash and money market instruments denominated in sterling. The Euro Fund will normally consist of cash and money market instruments denominated in euro. The Canadian Dollar Fund will normally consist of cash and money market instruments denominated in Canadian dollars. However, the Company may also invest in loans, interest rate swaps, adjustable rate securities, repurchase agreements, short-dated bonds, government securities and other short-term instruments which the Manager believes to be of appropriate credit quality and which are consistent with the investment objectives of the relevant Fund. HSBC Corporate Money Funds Limited

16 The US Treasury Fund will normally consist of obligations issued by the US Treasury and agencies and repurchase agreements denominated in US Dollars. The Manager will establish (and may vary from time to time): 1) guidelines regarding financial institutions with whom the Manager may place deposits for the Company or whose certificates of deposit may be purchased for the Company; 2) guidelines establishing the criteria to be applied with regard to issuers or debtors when considering the purchase of loans, money market instruments (including money market funds), shortdated bonds and government securities; 3) the proportion of assets comprising any one Fund that may be deposited with any one financial institution or invested in instruments of any one issuer or debtor; and 4) guidelines as to the use of options, futures, currency swaps and structured notes. The Directors intend that these instruments will only be used for the purpose of efficient portfolio management. The Company aims to achieve its objective by investing in HSBC Global Liquidity Funds plc, an investment company domiciled in Ireland, whose investment objectives and policies are similar to the Company. A copy of the prospectus is available upon request. There can be no assurance that the investments of the Company, the US Dollar Fund, the US Treasury Fund, the Sterling Fund, the Euro Fund or the Canadian Dollar Fund will be successful or that the objectives of the Company will be attained. 4.2 Investment Restrictions The Bye-laws of the Company contain no restrictions on the investments or borrowing powers of the Directors in respect of any Fund. However, the Directors intend that the Company shall not for the account of any Fund: 1) acquire securities or instruments with an unexpired maturity or interest rate refixing date of more than 13 months; 2) make loans (except to the extent that the acquisition of an investment might constitute a loan) or guarantee the repayment of loans other than the making of deposits with the Bank or any bank or deposit-taking institution approved by the Manager; 3) invest in real property, commodities or commodity contracts; 4) acquire any asset or investment which would involve the assumption of unlimited liability unless a corresponding hedge transaction is entered into in respect to that asset or investment; 5) make investments which will result in the Company exercising legal or management control of any underlying investments; 6) invest more than 10% of the value of the net assets of a Fund in securities issued by any one body corporate or group of companies (expect for securities issued by the government of an OECD country, supra-national entities and securities issued by agencies backed by such governments or supra-national entities and for Triple A rated money market funds); and 7) sell securities short, buy securities on margin or buy, sell or deal in options in securities or warrants except for the purposes of hedging. The Manager shall not in any case be obliged to reduce any holding if any such limit were exceeded owing to the appreciation or depreciation of investments, the receipt of profits, bonuses or benefits in the nature of capital, any scheme of arrangement or amalgamation, reconstruction, conversion or exchange, any redemption of shares or fluctuations in exchange rates. However, if these limits are exceeded, the Company may not add further to such investments. The limits and restrictions in section 2 above and in Borrowing Limits below are exclusive of and therefore do not apply to the sweep facility activities described below. 4.3 The Sweep Facility A sweep facility is provided by the Bank to certain approved Bank corporate customers to enable an automatic transfer of funds at the end of each Business Day from or to their current account to or from the HSBC Corporate Money Funds Limited

17 relevant Fund. The resulting overnight balances are shown as cash or an overdraft of the relevant Fund and are settled through trading of securities on the next business day. Interest is earned or paid on these balances at a rate equal to the daily yield of the relevant Fund so as not to affect the position of the shareholders of the relevant Fund who do not utilise the sweep facility. The sweep facility does not disadvantage any shareholders who are unable to participate in the sweep facility and does not affect the calculation of the daily yield. 4.4 Risk Factors Foreign Exchange Investors should be aware that investments in a Fund with a Base Currency other than their own will create a foreign exchange exposure and the value of the investment in terms of their own currency may be depleted significantly as a result. Options, Futures & Swaps The use of options, futures, currency swaps and interest rate swaps involve special risks including dependence on the ability to predict movements in interest or currency rates and imperfect correlation between the hedging instruments and the securities being hedged. Insolvency Investors should also be aware that the value of Shares of a Fund could be adversely affected by the insolvency or similar financial difficulties affecting any institution, including the Bank, with which the cash of the relevant Fund has been deposited, or any issuer whose securities are held by the relevant Fund. Repurchase Agreements In the event of a bankruptcy or other default of a seller of a repurchase agreement, the Company could experience both delays in liquidating the underlying securities and losses, including a possible decline in the value of the underlying securities during the period when the Company seeks to enforce its rights thereto, reduced levels of income and lack of access to income during this period and the expenses of enforcing its rights. Negative Yield Market conditions, including but not limited to a reduction in interest rates, may have a material impact on the Yield payable on Shares of a Class. Either the Yield will be so low that following the deduction of the charges and expenses applicable to the Class it will be a negative number (Negative Net Yield) or the Yield will already be a negative number before the charges and expenses have been deducted (Negative Gross Yield). Such market conditions, together with any actions taken by financial institutions in response thereto (such as, for example, by way of reducing interest rates and therefore income payable on investments of a Fund), are outside the control of the Directors. A Negative Net Yield and/or Negative Gross Yield environment creates potential issues for the Distributing Share Classes which seek to maintain their respective Shares at a constant Net Asset Value per Share. In such an environment, the Yield of a Distributing Share Class may not be sufficient to pay a distribution or cover charges or expenses or other liabilities attributable to such Class, such as the fees of the Manager or other operating costs. As a result of the above, each Shareholder in a Distributing Share Class is deemed, as a result of investing in the Company and/or continuing its investment in the Company, to have acknowledged and agreed that the Company may automatically redeem such number of Shares held by the Shareholder, which represent the Shareholder s pro-rata share of any Negative Yield in respect of the applicable Distributing Share Class (each a Special Redemption ). Accordingly, the Company may automatically redeem such Shares where a Negative Yield applies to such Share and, following such Special Redemption, the Company will retain the applicable redemption proceeds and will apply them to discharge the Shareholder s pro-rata share of such Negative Yield. For the sake of clarity, redemption proceeds resulting from a Special Redemption HSBC Corporate Money Funds Limited

18 will not be paid to the Shareholders who were subject to the Special Redemption but instead will be retained by the Company and applied toward the Negative Yield of that Class (in order to discharge any liability, operating cost or fee attributable to the Class). Any redemption of shares pursuant to a Special Redemption shall be made on the last Business Day of each calendar month, save that if a shareholder redeems all shares during a calendar month, all redemptions applicable to such shareholder shall be made prior to payment of the redemption proceeds. Accordingly, the last Business Day of each calendar month or the date of redemption of a shareholder's entire holding has been designated by the Manager as the Dealing Day for Special Redemptions. For the sake of clarity the Manager may in its sole discretion determine to effect Special Redemptions on days other than the last Business Day of each calendar month from time to time. While Special Redemptions in these circumstances may enable the Company to maintain the relevant Distributing Share Class at a constant Net Asset Value per Share, the number of Shares in issue in such Distributing Share Class and therefore the number of Shares held by a Shareholder in such Class, will be decreased proportionately to the decrease in the value of the assets of the applicable Class caused by the Negative Yield. As a result, a Shareholder holding Shares in a Distributing Share Class may not realise the full amount of his original investment in such Class. Investors should also note that although the Directors will seek to stabilise the Net Asset Value per Share in each Distributing Share Class, there can be no assurance that the Company will be able to attain this objective. 4.5 Dividend Policy It is the intention of the Directors of the Company to declare dividends on each Dealing Day in respect of each Class of Shares of each Fund, except for Accumulating Share Classes (e.g. Class R Shares). Subject to the statutory test, dividends may be paid out of net income or net realised investment gains at the sole discretion of the Directors. The test is that the Company shall not declare or pay a dividend, if there are reasonable grounds for believing that the Company is, or would after the payment, be unable to meet its liabilities as they become due. Shares of each Fund, except Accumulating Share Classes (e.g. Class R Shares), begin earning income and shall be entitled to dividends on the day the Shares are issued until the day preceding the day on which the Shares are redeemed. Dividends will be payable on the last Business Day of each calendar month and are automatically reinvested in additional Shares of the same Class (or fractions thereof) as determined by reference to the relevant Net Asset Value per Share on such day. Shareholders may also elect to have their dividends paid to the account indicated on the initial Application Form. Shares subscribed for before the deadline on a Dealing Day shall begin earning income and their dividend entitlement on that day. No interest will be paid on accrued but unpaid dividends. If a shareholder redeems all Shares during a calendar month, all dividends to which such shareholder is entitled will be paid along with the redemption proceeds. It is the policy of the Directors to maintain a stable Net Asset Value per Share in each Fund, except for Accumulating Share Classes; however, the Company cannot guarantee this result. To the extent necessary to maintain a stable Net Asset Value per Share, the Company may effect Special Redemptions or temporarily reduce or suspend the declaration of daily dividends or take any action deemed appropriate for this purpose. Dividends declared in relation to Class A Shares, Class B Shares, Class C Shares and Class I Shares in each Fund will vary to the extent that the management fees applicable to each Class of the relevant Fund differ. Additionally, dividends may be declared at a different rate for each Fund. With respect to the Class R Shares, shareholders do not receive dividends since their share of income and profits are accumulated and reflected in the daily Net Asset Value per Share. HSBC Corporate Money Funds Limited

19 5.0 Management & Administration 5.1 Directors L Anthony Joaquin, Bermudian, a Fellow of the Institute of Chartered Accountants, is retired Managing Partner of the Bermuda office of Ernst & Young. Mr. Joaquin has served as the Deputy Chairman of the Bermuda Government Insurance Advisory Committee (the main policy making body for insurance regulation in Bermuda) and as Chairman of the Insurance Regulatory Sub-Committee. He has also served as a member of the International Business Forum, the Bermuda Government Tax Advisory Committee and the Price Control Commission. He is currently a director of the Bermuda Monetary Authority, SAL Limited, BELCO Holdings Limited and BF&M Limited. Faith A. Outerbridge, Bermudian, is the Head of HSBC Global Asset Management Bermuda. She originally joined the Bank of Bermuda in 1993 as a Fund Manager, bringing the previously outsourced money market fund management in-house. She then progressed to the role of Senior Fund manager in 2000 with oversight of all in house managed money market funds, including the sterling and euro funds. In 2003, she became the Director of Investment Management, an expanded role including oversight of all other nonliquidity in-house managed funds, most notably the fund of funds business. Ms Outerbridge was promoted to the Regional CIO for Liquidity in 2006 and had oversight for the management of all Liquidity funds managed in the Americas. She was promoted to her current role in April Prior to joining the bank, she worked at ACE Ltd and the Bank of Butterfield. She obtained her BA in Administrative and Commercial Studies from the University of Western Ontario in 1989, her MBA from Dalhousie University in 1991 and her CFA designation in Wayne P. Chapman, British, is Head of Private Banking Bermuda, HBSC Bank Bermuda Limited. Mr. Chapman joined the Bank of Bermuda in 1980 as a Fund Accounting Supervisor and held several management positions within Corporate Trust, Bermuda, until his 1994 secondment to the Bank s Luxembourg office as Head of Corporate Trust Services, Europe. In 1996, he was appointed Managing Director of the Luxembourg office. Mr. Chapman returned to Bermuda in July 1997 and assumed the position of Senior Vice President of Investment Services. In 2001, he became the Global Business Head of Private Clients. Mr. Chapman holds degrees in Business and Financial Services. Julie E. McLean, British, is a Director in the Corporate Department of Conyers Dill & Pearman Limited in Bermuda, which she joined in Ms. McLean also spent two years in the Hong Kong office of Conyers Dill & Pearman specialising in the initial public offerings of Bermuda companies listed on the Hong Kong Stock Exchange. Ms. McLean has an LLB from the University of British Columbia and a BA from the University of Western Ontario. The Directors of the Company are responsible for the overall investment policy and administration of the Company and each of the Funds. 5.2 Manager The Company has appointed HSBC Global Asset Management (Bermuda) Limited, formerly HSBC Investments (Bermuda) Limited, as its Manager, under an agreement between the Company and the Manager (the Management Agreement ), with responsibility for the management of the Company and the supervision of the administration of the Company. The Manager is a wholly owned subsidiary of HSBC Bank Bermuda Limited. The Manager is a company incorporated on 1 September 1966, with limited liability in and under the laws of Bermuda. The name of the Manager was changed to its present name on 2 June, The Manager presently conducts investment management for other HSBC Bank Bermuda mutual funds and institutional clients. The current Directors of the Manager are Mr. Wayne P. Chapman, Ms. Faith A. Outerbridge, (also Directors of the Company), Ms. Deborah A. Hazell, Mr Blake Hellam and Ms. Renee M. Lewis. HSBC Corporate Money Funds Limited