Launch Date 19 April Manager Pacific Mutual Fund Bhd ( U) a company incorporated in Malaysia under the Companies Act 1965

Transcription

1 Launch Date 19 April 2017 Manager Pacific Mutual Fund Bhd ( U) a company incorporated in Malaysia under the Companies Act 1965 Trustee MTrustee Berhad ( V) INVESTORS ARE ADVISED TO READ AND UNDERSTAND THE CONTENTS OF THIS INFORMATION MEMORANDUM. IF IN DOUBT, PLEASE CONSULT A PROFESSIONAL ADVISER. FOR INFORMATION CONCERNING CERTAIN RISKS, WHICH SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS, SEE RISKS ON PAGE 10. THIS INFORMATION MEMORANDUM DATED 16 JANUARY 2018 IS ISSUED TO REPLACE THE INFORMATION MEMORANDUM DATED 18 MAY

2 RESPONSIBILITY STATEMENTS This information memorandum has been seen and approved by the directors of Pacific Mutual Fund Bhd ( the Manager ) and they collectively and individually accept full responsibility for the accuracy of all information contained herein and confirm, having made all enquiries which are reasonable in the circumstances, that to the best of their knowledge and belief, there are no other facts omitted which would make any statement herein misleading. STATEMENTS OF DISCLAIMER The Securities Commission Malaysia will not be liable for any non-disclosure on the part of the Manager and takes no responsibility for the contents of the information memorandum, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from, or in reliance upon the whole or any part of the content of this information memorandum. ADDITIONAL STATEMENTS While it is the duty of the Manager to ensure that all comments given to the media is accurate and true at the time the comments were given, misquotation may still occur either by the media or third parties, which are out of the Manager s control. In such situations, the Manager and its employees hold no responsibility for any claims and liabilities due to the misquotations by the media and/or third parties, and are under no obligation to fulfil any expectation or demand in relation to the misquoted statements. The distribution of this information memorandum and offering, purchase, sale or transfer of units of the Fund in certain jurisdictions may be restricted by law. In these jurisdictions, other than Malaysia, the Manager has not applied to allow distribution of this information memorandum or units of the Fund. Therefore, this information memorandum does not constitute an offer or invitation to purchase units of the Fund in any jurisdiction in which such offer or invitation would be unlawful. Investors should be aware that for investments of our fund made via our Institutional Unit Trust Advisers (IUTA), where applicable, any investment transactions are subject to the terms and conditions of the respective IUTA. i

3 TABLE OF CONTENTS Responsibility Statements. i Table Of Contents ii Corporate Directory 1 Definitions. 2 Key Information Of The Fund Risks Risks Associated To The Fund 10 Transaction Information. 11 Pricing Policies 11 Minimum Initial Investment 11 Minimum Additional Investment 11 Purchase Of Unit Procedure 11 Redemption 12 Periodic Reporting To Investors 12 Policies And Procedures To Prevent Money Laundering Activities 12 All About The Manager Pacific Mutual Fund Bhd Our Shareholders 13 Our Core Business 13 Our Key Investment Team Members 13 Conflict Of Interest 14 Trustee Of The Fund, Its Duties And Responsibilities MTrustee Berhad ( V) 15 The Trustee s Responsibilities 15 Trustee s Statement Of Responsibility 15 Taxation Adviser's Letter Pacific Mutual Fund Bhd And Directory Of OCBC Bank (Malaysia) Berhad 20 ii

4 CORPORATE DIRECTORY Manager Pacific Mutual Fund Bhd ( U) Business Office 1001, Level 10, Uptown 1, No. 1 Jalan SS21/58, Damansara Uptown, Petaling Jaya, Selangor Darul Ehsan Tel: Fax: direct-sales-dist@pacificmutual.com.my Website: Registered Office 19 th Floor, Menara OCBC, No. 18 Jalan Tun Perak, Kuala Lumpur Tel: ; Board Of Directors Gerard Lee How Cheng (Chairman) James Tan Thian Peng Dato Ahmad Zahudi bin Haji Salleh Ong Eu Jin* Datuk Lee Say Tshin* Teh Chi-cheun Audit Committee James Tan Thian Peng (Chairman) Ong Eu Jin** Datuk Lee Say Tshin** Investment Committee Gerard Lee How Cheng (Chairman) James Tan Thian Peng Muhammad Azmi bin Mohd Rafai Dato Ahmad Zahudi bin Haji Salleh Ong Eu Jin*** Datuk Lee Say Tshin*** Trustee MTrustee Berhad ( V) Registered Office: B-2-9 (2 nd Floor), Pusat Perdagangan Kuchai, No. 2, Jalan 1/127, Off Jalan Kuchai Lama Kuala Lumpur Business Office: 15 th Floor, Menara AmFIRST, No. 1, Jalan 19/3, Petaling Jaya, Selangor Tel: Fax: * Independent Directors ** Independent Audit Committee members *** Independent Investment Committee members 1 Corporate Directory

5 DEFINITIONS The meaning of some terms in this information memorandum is explained below: Board of Directors / Independent Directors / Directors business day(s) deed eligible market Fund Funds GST information memorandum IUTA NAV NAV per unit OCBC Bank Pacific Mutual / Company / Manager / we SC Guidelines SC / Securities Commission short term / medium term / long term Directors of Pacific Mutual Fund Bhd A day on which the banks in Kuala Lumpur is open for business. The deed and all supplemental deeds entered into between the Manager and the Trustee in relation to the Fund. A market that is regulated by a regulatory authority, operates regularly, is open to the public and has adequate liquidity for the purposes of the Fund. Pacific OCBC Cash Fund For the purpose of this information memorandum, unless the context otherwise requires, Funds mean all funds managed by the Manager. Tax levied on goods and services pursuant to the Goods and Services Tax Act Refers to the information memorandum and supplementary or replacement information memorandum (if any) in relation to the Fund managed by Pacific Mutual. Institutional Unit Trust Advisers IUTA is an institution, body or organisation that is licensed to distribute unit trust funds. IUTA must be registered with the Federation of Investment Managers Malaysia (FiMM). Net asset value (NAV) of the Fund is the total value of the Fund s assets minus its liabilities at a valuation point. In computing the annual management fee and annual trustee fee, the NAV of the Fund should include the management fee and the trustee fee for the relevant day. Net asset value (NAV) per unit of the Fund is the NAV divided by the total number of units in circulation, at a particular valuation point. OCBC Bank (Malaysia) Berhad ( W) and OCBC Al-Amin Bank Berhad ( T) Pacific Mutual Fund Bhd ( U) Guidelines on Unlisted Capital Market Products Under the Lodge and Launch Framework issued by the Securities Commission Malaysia as may be amended from time to time. Securities Commission Malaysia Short term - one year and below; medium term - above one year to three years; long term - above three years. 2 Definitions

6 sophisticated investor Pursuant to the SC Guidelines, this means any person who falls within any of the following categories as set out in Part 1, Schedule 6 and 7 of the Capital Markets and Services Act 2007 (CMSA): Accredited investors 1. a unit trust scheme, prescribed investment scheme or private retirement scheme; 2. a holder of a Capital Markets Services License; 3. an executive director or a chief executive officer of a holder of a Capital Markets Services License; 4. a closed end fund approved by the Securities Commission; 5. a bank licensee or insurance licensee as defined under the Labuan Financial Services and Securities Act 2010; 6. an Islamic bank licensee or takaful licensee as defined under the Labuan Islamic Financial Services And Securities Act 2010; 7. a licensed institution as defined in the Financial Services Act 2013 or an Islamic bank as defined in the Islamic Financial Services Act 2013; 8. an insurance company registered under the Financial Services Act 2013 or a takaful operator registered under the Islamic Financial Services Act 2013; or 9. Bank Negara Malaysia. High-net worth entities 1. a company that is registered as a trust company under the Trust Companies Act 1949 which has assets under management exceeding RM10 million or its equivalent in foreign currencies; 2. a corporation that is a public company under the Companies Act 1965 which is approved by the Securities Commission to be a trustee under the CMSA and has assets under management exceeding RM10 million or its equivalent in foreign currencies; 3. a corporation with total net assets exceeding RM10 million or its equivalent in foreign currencies based on the last audited accounts; 4. a partnership with total net assets exceeding RM10 million or its equivalent in foreign currencies; 5. a statutory body established by an Act of Parliament or an enactment of any State; or 6. a pension fund approved by the Director General of Inland Revenue under the section 150 of Income Tax Act High-net worth individual 1. an individual a. whose total net personal assets, or total net joint assets with his or her spouse, exceeds RM3 million or its equivalent in foreign currencies, excluding the value of the individual s primary residence; b. who has a gross annual income exceeding RM300,000 or its equivalent in foreign currencies per annum in the preceding 12 months; or c. who, jointly with his or her spouse, has a gross annual income exceeding RM400,000 or its equivalent in foreign currencies per annum in the preceding 12 months. Trustee unitholder(s) MTrustee Berhad ( V) The person for the time being who is registered pursuant to the deed as a holder of units, including a jointholder. 3 Definitions

7 KEY INFORMATION OF THE FUND Management Company: PACIFIC MUTUAL FUND BHD ( U) This section contains the salient information about the Fund. Investors should read and understand the whole information memorandum before making any investment decisions. FUND INFORMATION FUND NAME Pacific OCBC Cash Fund FUND PROFILE Fund Category Fund Type Characteristic Money market (wholesale) Income Conservative BASE CURRENCY Ringgit Malaysia (MYR) INITIAL OFFER PRICE RM INITIAL OFFER PERIOD 19 April 2017 (one day) FINANCIAL YEAR END 31 December INVESTMENT OBJECTIVE The Fund aims to provide regular income, liquidity and capital stability by investing in cash deposits. Any material changes to the Fund s objective would require unitholders approval. INVESTMENT STRATEGY The Fund will invest wholly in cash deposits with OCBC Bank to generate continual stream of income that is competitive versus the prevailing saving rates. The Fund focuses on cash deposits with OCBC Bank with maturities of not more than one year. However, in the event that the Manager is not able to place the Fund s assets with OCBC Bank immediately, such assets may be held in cash account(s) with OCBC Bank until a placement can be made. All investments of the Fund are in Malaysian Ringgit. Income is in reference to the Fund s distribution, which will be in the form of cash or units. Please refer to page 9 for further details on income distribution policy and reinvestment policy. 4 Key Information Of The Fund

8 FUND INFORMATION (Continuation) ASSET ALLOCATION Up to 100% in cash deposits with OCBC Bank with maturities of up to one (1) year. PRINCIPAL RISKS ASSOCIATED WITH THE FUND Please refer to page 10. Early termination of cash deposit risk Reinvestment risk Inflation or purchasing power risk Concentration risk Credit risk PERFORMANCE BENCHMARK Maybank Overnight Repo Rate INVESTOR PROFILE The Fund is suitable for sophisticated investors who: seek liquid investment; are conservative; seek cash management solutions; and seek regular income and prefer short to medium-term investment horizon. PERMITTED INVESTMENTS Unless otherwise prohibited by the relevant authorities or any relevant law and provided always that there are no inconsistencies with the objective of the Fund, the Fund is permitted under the deed to invest in cash deposits with OCBC Bank, capable of being converted into cash within such time pursuant to the requirement under the relevant laws. INVESTMENT RESTRICTIONS The Fund s placements in cash deposits with OCBC Bank shall be up to 100% of the Fund s NAV with maturities of up to one (1) year. BASES OF VALUATION OF THE FUND S INVESTMENTS All assets of the Fund should be valued in a fair and accurate manner at all times. The Fund s investments in deposits placed with OCBC Bank are valued daily by reference to their nominal values and accrued interest thereon. Income is in reference to the Fund s distribution, which will be in the form of cash or units. Please refer to page 9 for further details on income distribution policy and reinvestment policy. 5 Key Information Of The Fund

9 FEES AND CHARGES RELATED TO THE FUND The table below describes the fees and charges that you may DIRECTLY incur when you buy or redeem units of the Fund. Please note that normal banking charges are applicable to the investors. MAXIMUM SALES CHARGE There is no sales charge imposed on unitholders of the Fund. REDEMPTION CHARGE There is no redemption charge imposed on unitholders of the Fund. SWITCHING FEE There is no switching fee imposed on unitholders of the Fund. TRANSFER FEE There is no transfer fee imposed on unitholders of the Fund. The table below describes the fees and expenses that you may INDIRECTLY incur when you invest in the Fund. ANNUAL MANAGEMENT FEE The annual management fee is a fee charged for the ongoing portfolio management and administration of the Fund (e.g. to maintain unitholders' register, proper records of the Fund and to administer the investments). The annual management fee for the Fund is up to 0.50% per annum of the NAV of the Fund. The annual management fee is calculated based on the NAV of the Fund, accrued on a daily basis and is paid out of the Fund. The annual management fee is payable on a monthly basis. The annual management fee quoted is subject to any applicable taxes (including but not limited to GST) and/or duties as may be imposed by the government or other authorities from time to time. ANNUAL TRUSTEE FEE The annual trustee fee is a fee paid to the Trustee for the administration of the Fund's assets (e.g. transaction settlement, custody and administration costs). The annual trustee fee for the Fund is up to 0.02% per annum of the NAV of the Fund. The annual trustee fee is calculated based on the NAV of the Fund at the Fund's annual trustee fee rate, calculated and accrued on a daily basis and is paid out of the Fund. The annual trustee fee is payable on a monthly basis. The annual trustee fee quoted is subject to any applicable taxes (including but not limited to GST) and/or duties as may be imposed by the government or other authorities from time to time. 6 Key Information Of The Fund

10 FEES AND CHARGES RELATED TO THE FUND (Continuation) OTHER EXPENSES Expenses directly related to the Fund are management fee, trustee fee and other administrative expenses (e.g. auditor's fee, courier and handling charges, etc). Other expenses, which are directly related and necessary to the business of the Fund, may be charged to the Fund. These will include (but are not limited to) the following: fees and other expenses properly incurred by the auditor and tax agent; taxes, including but not limited to GST, and other duties charged on the Fund by the government and other authorities; printing and postage expenses; and any other legitimate administration expense or relevant professional fees approved by the Trustee. There are fees and charges involved and investors are advised to consider them before investing in the Fund. All fees and charges payable to the Manager and/or the Trustee are subject to any applicable taxes (including but not limited to GST) and/or duties as may be imposed by the government or other authorities from time to time. 7 Key Information Of The Fund

11 TRANSACTION INFORMATION MINIMUM INITIAL AND ADDITIONAL INVESTMENT Cash Plan You may invest by cash on a lump sum basis. The initial and additional investment must be a minimum of RM10,000 and RM5,000 respectively. We have the discretion to accept a lower amount than that disclosed in the information memorandum as we deem fit. MINIMUM REDEMPTION AMOUNT There is no minimum redemption amount. MINIMUM HOLDING AND REDEMPTION OF UNITS Please refer to page 12. You can withdraw or redeem all or part of your units in the Fund, in writing, at any time provided the minimum number of units left in an account after the partial withdrawal is 500 units. If units in your account are less than the minimum holding after the redemption application is made, all units in your account will be redeemed automatically. SWITCHING FACILITY To carry out a switching transaction, all you need to do is to complete the transaction form or send a letter of request to our head office by 2.00 p.m. on any business day. The Fund is allowed to switch into other wholesale funds of Pacific Mutual as permitted by Pacific Mutual. You may contact our client relations personnel or OCBC Bank (Malaysia) Berhad as listed on page 20 for more information on the switching facility. TRANSFER FACILITY Transfer facility is available for the Fund, free of charge. The transferee must be a sophisticated investor and provide the necessary declaration. The transfer form must be completed in the presence of a witness. For partial transfer, the minimum balance to be maintained in your unit trust account must be 500 units. 8 Key Information Of The Fund

12 OTHER INFORMATION INCOME DISTRIBUTION AND REINVESTMENT POLICY Distribution of income, monthly, depending on the availability of realised income and/or realised gains and at our discretion. We have the right to make provisions for reserves in respect of distribution of the Fund. If the income available is too small or insignificant, we may choose not to distribute the income as the distribution may not be beneficial to the unitholders as the total cost to be incurred in such distribution may be higher than the amount available for distribution. We have the discretion to decide on the amount to be distributed to the unitholder. We also have the discretion to make income distribution on an ad-hoc basis, taking into consideration the level of its realised income and/or realised gains, as well as the performance of the Fund. Distribution of income is in the form of cash or units. When there are huge amount of early termination of cash deposit placements due to fund redemptions, this may result in no interest income received and thus no income distributions being possible. Income distributions will be paid directly to your bank account. In the absence of written instructions to the contrary, distributions declared by the Fund will be automatically reinvested into additional units of the Fund based on the NAV per unit of the Fund on the next business day after the declaration of distributions at no cost. Distribution amounting to less than or equal to the amount of RM200 will be automatically reinvested based on the NAV per unit of the Fund on the next business day. Income distributions are not guaranteed and may not be repeated. Distributions of income will only be made from realised gains or realised income derived from the investments of the Fund. DEED(S) OF THE FUND Principal Deed: 5 January 2016 First Supplemental Deed: 29 August 2016 Second Supplemental Deed: 22 March 2017 Third Supplemental Deed: 12 April 2017 Fourth Supplemental Deed: 18 December 2017 AVENUE FOR ADVICE You may contact our client relations personnel or OCBC Bank (Malaysia) Berhad as listed on page 20. For information concerning certain risk factors, which should be considered by prospective investors, see Risks on page 10. Unit prices and distributions payable, if any, may go down as well as up. 9 Key Information Of The Fund

13 RISKS RISKS ASSOCIATED TO THE FUND Early termination of cash deposit risk This is the risk of the Fund having to terminate/withdraw from placements in deposits before the maturity date of the respective placements due to redemptions from the Fund. As a result of the premature termination of placements, there will be a loss of a percentage or even all of the interests accumulated during the period of holding of the deposits, resulting in loss of income to the Fund. To mitigate this risk, the Manager anticipates the potential percentage of the Fund that may experience redemptions and allocates maturities accordingly. For example, the Manager may ensure that there are sufficient tranches of deposits maturing weekly to meet any potential redemption from the Fund. Reinvestment risk This is a risk that future proceeds (interest and/or capital) are reinvested at a lower interest rate. Reinvestment risk is especially evident during periods of falling rates where the interest payments (from existing placements) are reinvested at less than the interest rate at the time of purchase. Inflation or purchasing power risk This risk refers to the effect of inflation or loss of purchasing power on the value of investment returns and the worth of the investment itself. Investors returns from the Fund may not keep pace with inflation and hence reduce their purchasing power. Concentration risk This risk refers to the number of underlying investments/ financial institutions which the fund invests in/ places deposit with. Concentration risk is evident if the Fund invests its assets in a single underlying instrument or with a single financial institution. As the objective of the Fund is to provide regular income, liquidity and capital stability by investing in cash deposits with OCBC Bank, if OCBC Bank defaults, there will be significant impact on the Fund. This risk is mitigated by active monitoring of the creditworthiness of OCBC Bank. Credit risk This risk refers to changes in the financial conditions of OCBC Bank which may affect their credit worthiness. This in turn may lead to default in the repayment/payment of principal and interest. These events can lead to loss of capital and/or delayed or reduced income for a fund resulting in a reduction in a fund's asset value and thus unit price. This risk is mitigated by active monitoring of the creditworthiness of OCBC Bank. 10 Risks

14 TRANSACTION INFORMATION PRICING POLICIES The buying and selling price of units is quoted based on a single price i.e. the NAV per unit of the Fund. All other transactions charges, if any, will be expressed separately from the price of a unit. Valuation Of NAV The valuation of NAV for the Fund will be conducted at the end of each business day. The daily unit price of the Fund will be published on the next business day. Valuation Of Units Valuation of units is based on the NAV of the Fund and is calculated at the end of every business day. The NAV per unit of the Fund is determined by dividing the Fund s assets less its liabilities by the number of units in circulation. After the offer period, the price of a unit of the Fund is calculated based on the NAV per unit of the Fund as at the next valuation point after we receive the original application ("forward pricing"). The NAV per unit may be rounded to four decimal places. An incorrect valuation and/or pricing of the Fund shall be considered of minimal significance if the error involves a discrepancy of less than 0.5% of the NAV per unit of the Fund. Any pricing discrepancy of 0.5% or more of the NAV per unit of the Fund will be rectified as stated in the Fund s deed unless the total impact of the discrepancy on an individual account is less than RM10.00 as the transaction cost may be more than the amount adjusted. If we receive your duly completed and accepted original application form to purchase or redeem the Fund by the cut-off time of 2.00 p.m. on any business day, the NAV per unit will be calculated based on the NAV per unit at the end of that business day. Any application form (original copy) received after this cut-off time will be considered as being transacted on the next business day and will be subjected to the NAV per unit of the Fund on the next business day. MINIMUM INITIAL INVESTMENT To invest, please complete our account application form, investment form and declaration form, and forward them to any Pacific Mutual offices or our authorised representatives, the details of which can be found on page 20. Fund Pacific OCBC Cash Fund Cash Plan Lump Sum Cash RM10,000 minimum initial investment. We have the discretion to accept a lower amount than that disclosed in the information memorandum as we deem fit. MINIMUM ADDITIONAL INVESTMENT If you are already a unitholder of our Fund and wish to purchase additional units, please complete our investment form, indicating your existing unit trust account number. In the event, a new account application form is received by us for the purchase of additional units, we may at our discretion credit the additional units appropriately into your existing account of the Fund. The following are the minimum additional investments for the Fund: Fund Pacific OCBC Cash Fund Cash Plan Lump Sum Cash RM5,000 minimum additional investment. We have the discretion to accept a lower amount than that disclosed in the information memorandum as we deem fit. PURCHASE OF UNIT PROCEDURE Your purchase application for units and payment (subject to funds clearance) must reach our head office or our branches by 2.00 p.m. on any business day. Any duly completed and accepted original application form and payment (subject to funds clearance) received after this cut-off time is considered as being transacted on the next business day. In addition to the submission of the above form, you may be required to forward to us additional documents to authenticate your identification when transacting units of the Fund. We may for any reason at any time, waive existing procedures, and/or prescribe applications for units in any other form or manner whether for all/any particular investor, at our discretion. Investors are advised NOT to make payment in cash when purchasing units of the Fund. 11 Transaction Information

15 REDEMPTION The Price Of A Unit At NAV per unit. Frequency Of Redemption No restrictions. Redemption Of Unit Procedure Upon receipt of the duly completed and accepted original transaction form, which must reach our head office or our branches by 2:00 p.m. on any business day, we will repurchase the units at the Fund s NAV per unit calculated at the end of that business day. Payment will be made to you on the next business day. Any duly completed and accepted original transaction form received after 2:00 p.m. on any business day will be considered as being transacted on the next business day, payment will be made to you within two (2) business days from the date of receipt of the transaction form. We will repurchase the units at the Fund s NAV per unit calculated at the end of the next business day. However, if the total redemption amount for that day exceeds 50% of the Fund s NAV, we reserve the right to pay the redemption proceeds to the unitholders within 10 days from the day the redemption request is received by us. Pacific Mutual will not be held responsible for any loss/delay in the event of: 1) Real Time Electronic Transfer of Funds and Securities (RENTAS) experiencing problems; 2) Inaccurate details e.g. identity card number, account number, etc. furnished by you; and 3) Situations beyond the control of Pacific Mutual or the Trustee. There is no minimum redemption amount for the Fund. For partial redemption, the minimum balance to be maintained in your unit trust account must be 500 units or such sum as may be decided by the Trustee and the Manager from time to time. If units in your account are less than the minimum holding after the redemption application is made, all units in your account will be redeemed automatically. PERIODIC REPORTING TO INVESTORS Unitholders of the Fund will receive monthly statement of account, which will provide the unitholders with the latest update of their investment account. Unitholders will also receive quarterly and annual reports, containing information in relation to the Fund s investment strategies, outlook, performance portfolio holdings, key risk factors and accounts. These reports will be sent to the unitholders within two months from the close of the quarter period and from the financial year end of the Fund respectively. You are advised to keep abreast of the developments of the Fund. POLICIES AND PROCEDURES TO PREVENT MONEY LAUNDERING ACTIVITIES We have policies and procedures in place to comply with the legislation in force in Malaysia to prevent money laundering activities. In order to implement these procedures, investors will be required to provide detailed verification of identity including but not limited to proof of identity, residential or registered address, occupation or business, funds or source of income when buying or redeeming units and to periodically update their records. Until satisfactory evidence has been received, we reserve the right to refuse or accept the application form from investors to buy or redeem units or to pay the proceeds of the redemption of units. We may delay or refuse any application without giving any reason for doing so where this is in accordance with our anti-money laundering obligations. We also reserve the right to request additional information including the identity of any beneficial owners as may be required to support the verification of information and to allow us to carry out due diligence exercise on the investors in compliance with the relevant legislation. Any suspicious transaction will be reported to the relevant authority. 12 Transaction Information

16 ALL ABOUT THE MANAGER PACIFIC MUTUAL FUND BHD OUR SHAREHOLDERS Lion Global Investors Limited (formerly known as Lion Capital Management Limited) owns 70% equity interest in the share capital of Pacific Mutual and Koperasi Angkatan Tentera Malaysia Berhad owns the remaining 30%. Lion Global Investors Limited is a company incorporated in Singapore since 1986, and is a member of the Singapore OCBC Group of Companies. The ultimate holding company of Pacific Mutual is Oversea-Chinese Banking Corporation Limited, a public listed company incorporated in Singapore. OUR CORE BUSINESS The principal activities of Pacific Mutual are the establishment and management of unit trust funds as well as the management of private investment mandates. We obtained our Capital Markets And Services Licence from the Securities Commission since 21 December Pacific Mutual was incorporated on 15 March 1995 under the Companies Act 1965 with an authorised and paid-up capital of RM5 million divided into 5 million ordinary shares of RM1.00 each. Pacific Mutual s registered office is at 19 th Floor, Menara OCBC, 18 Jalan Tun Perak, Kuala Lumpur. OUR KEY INVESTMENT TEAM MEMBERS We take a team approach to the investment process and hold investment meetings on a daily basis. The decision-making process involves input from the entire team, with each team member (inclusive of analysts) contributing their respective expertise and views to yield fully informed conclusions. Our Investment Committee, whose responsibility is to ensure adherence to investment guidelines, both internal and external, as well as to assess strategy and implementation effectiveness, oversees the entire investment function. The following are the key members of the investment team and all of them hold the Capital Markets And Services Representative s Licence issued by the Securities Commission: Name: Position: Experience/Qualifications: Teh Chi-cheun Chief Executive Officer and Executive Director Chi-cheun started his career in the mid-1990s, in corporate finance before moving to the stockbroking industry in both Singapore and Malaysia, and subsequently into investment management. His investment and fund management experience extends globally as he managed developed market funds when he was with the fund management division of a Singapore government owned entity. Additionally, he also managed portfolios while with an investment outfit based in Canada. Upon his return to Malaysia in 2006, he joined Pacific Mutual as the Assistant General Manager of the Investment department, and was promoted to the Head of Equities one-and-a-half years later. He left Pacific Mutual in 2011 to head the entire stockbroking division of an investment bank. A year later, he joined a leading foreign insurance player in Malaysia as the head of investments (director). On 15 July 2015, he rejoined Pacific Mutual and is now its Chief Executive Officer and Executive Director. He oversees the overall management and direction of the Company and its Funds. Bachelor of Science (Honours) in Accounting and Financial Analysis (University of Warwick, England); CFA charterholder (CFA Institute). 13 All About The Manager Pacific Mutual Fund Bhd

17 Name: Position: Experience/Qualifications: Name: Position: Experience/Qualifications: Tan Yee Cheng Head of Equities, Investment She has over 22 years of experience in investment research and fund management. Prior to joining Pacific Mutual in May 2007 as Senior Manager, Investment, she was an investment manager in an Americanbased insurance company. She had earlier worked as a senior analyst and a research manager at two local stockbroking firms and headed the investment research of a local unit trust company. Master of Science in Economics (University of Idaho, USA); CFA charterholder (CFA Institute). Oh Jo Ann Senior Manager, Investment She is responsible for the management of fixed income portfolios and execution of fixed income transactions. She conducts analysis of individual fixed income securities and selection of those securities for inclusion into the portfolios. Her analysis of the domestic macro backdrop forms the basis for the overall fixed income investment strategy. She started her investment career with Pacific Mutual in January 2003 as an equities analyst before moving on to working full time on the fixed income portfolio in She has over 14 years of experience in fixed income investment research and fund management and has handled both Shariah and non-shariahcompliant fixed income portfolios. Bachelor of Management (Honours) in Finance (Universiti Sains Malaysia); CFA charterholder (CFA Institute). She is the designated person responsible for the investment management of the Pacific OCBC Cash Fund. Please refer to Pacific Mutual s website at for the updated profile of our key investment team members. CONFLICT OF INTEREST The Manager will at all times act in the best interests of the Fund and will not conduct ourselves in any manner that will result in a conflict of interest or potential conflict of interest. In the unlikely event that any conflict of interest arises, such conflict shall be resolved such that the Fund is not disadvantaged. In the unlikely event that we face conflicts in respect of our duties as the Manager to the Fund, we are obliged to act in the best interests of our investors and will seek to resolve any conflicts fairly and in accordance with the Deed. The Fund may maintain deposits only with OCBC Bank (Malaysia) Berhad, which is under the same holding company* of the Manager. * Oversea-Chinese Banking Corporation Limited is the immediate holding company of OCBC Bank (Malaysia) Berhad, and the ultimate holding company of Pacific Mutual Fund Bhd. 14 All About The Manager Pacific Mutual Fund Bhd

18 TRUSTEE OF THE FUND, ITS DUTIES AND RESPONSIBILITIES MTRUSTEE BERHAD ( V) Corporate Information MTrustee Berhad was incorporated on 28 July 1987 and registered as a trust company under the Trust Companies Act, 1949 and having its registered office at B-2-9 (2 nd Floor), Pusat Perdagangan Kuchai, No. 2, Jalan 1/127, Off Jalan Kuchai Lama, Kuala Lumpur. MTrustee Berhad is qualified to act as a trustee for collective investment schemes approved under the Capital Markets and Services Act Experience As Trustee To Unit Trust Funds MTrustee Berhad has been involved in unit trust industry as trustee since It acts as Trustee to various unit trust funds and real estate investment trust funds. THE TRUSTEE'S RESPONSIBILITIES The Trustee has agreed willingly to assume all its obligations under the deed and all written laws and SC Guidelines which cover the following: Take into custody the investments of the Fund and hold the investments in trust for the unitholders. Ensure that the Manager operates and administers the Fund in accordance with the provisions of the deed, SC Guidelines and acceptable business practice within the unit trust industry. As soon as practicable notify the Securities Commission of any irregularity or breach of the provisions of the deed, SC Guidelines and any other matters which in the Trustee's opinions may indicate that the interests of Unitholders are not served. Exercise reasonable diligence in carrying out their functions and duties, in actively monitoring the operation and management of the Fund by the Manager to safeguard the interests of unitholders. Maintain, or cause the Manager to maintain, proper accounting records and other records as are necessary to enable a complete and accurate view of the Fund to be formed and to ensure that the Fund is operated and managed in accordance with the deed of the Fund, information memorandum, the SC Guidelines and securities law. Require that the accounts be audited at least annually. TRUSTEE'S STATEMENT OF RESPONSIBILITY MTrustee Berhad is willing to assume the position and all obligations that come with it under the deed, all relevant written laws and rules of laws. 15 Trustee Of The Fund, Its Duties And Responsibilities

19 TAXATION ADVISER'S LETTER IN RESPECT OF THE TAXATION OF THE FUND AND THE UNITHOLDERS (PREPARED FOR INCLUSION IN THIS INFORMATION MEMORANDUM) 8 December 2017 Ernst & Young Tax Consultants Sdn Bhd Level 23A, Menara Milenium Jalan Damanlela Pusat Bandar Damansara Kuala Lumpur The Board of Directors Pacific Mutual Fund Bhd 1001, Level 10, Uptown 1 No. 1 Jalan SS21/58 Damansara Uptown Petaling Jaya Selangor Darul Ehsan Dear Sirs TAXATION OF THE FUND AND UNITHOLDERS This letter has been prepared for inclusion in this information memorandum in connection with the offer of units in the Pacific OCBC Cash Fund (hereinafter referred to as "the Fund"). The purpose of this letter is to provide prospective unitholders with an overview of the impact of taxation on the Fund and the unitholders. TAXATION OF THE FUND The taxation of the Fund is subject to the provisions of the Malaysian Income Tax Act 1967 ( MITA ), particularly Sections 61 and 63B. Subject to certain exemptions, the income of the Fund comprising interest and other investment income derived from or accruing in Malaysia after deducting tax allowable expenses, is subject to Malaysian income tax at the rate of 24% with effect from the year of assessment Tax allowable expenses would comprise expenses falling under Section 33(1) and Section 63B of the MITA. Section 33(1) permits a deduction for expenses that are wholly and exclusively incurred in the production of gross income. In addition, Section 63B allows unit trusts a deduction for a portion of other expenses (referred to as permitted expenses ) not directly related to the production of income, as explained below. Permitted expenses refer to the following expenses incurred by the Fund which are not deductible under Section 33(1) of the MITA: the Manager's remuneration; maintenance of the register of unitholders; share registration expenses; and secretarial, audit and accounting fees, telephone charges, printing and stationery costs and postage. These expenses are given a partial deduction under Section 63B of the MITA, based on the following formula: where A B C A X B 4C is the total of the permitted expenses incurred for that basis period; is gross income consisting of dividend 1, interest and rent chargeable to tax for that basis period; and is the aggregate of the gross income consisting of dividend 1 and interest (whether such dividend or interest is exempt or not) and rent, and gains made from the realisation of investments (whether chargeable to tax or not) for that basis period, provided that the amount of deduction to be made shall not be less than 10% of the total permitted expenses incurred for that basis period. 1 Pursuant to Section 15 of the Finance Act 2011, with effect from the year of assessment 2011, dividend income is deemed to include income distributed by a unit trust which includes distributions from Real Estate Investment Trusts. 16 Taxation Adviser s Letter

20 Exempt Income The following income of the Fund is exempt from income tax: Malaysian Sourced Dividends All Malaysian-sourced dividends should be exempt from income tax. Malaysian Sourced Interest (i) interest from securities or bonds issued or guaranteed by the Government of Malaysia; (ii) interest from debentures or sukuk, other than convertible loan stock, approved or authorized by, or lodged with, the Securities Commission; (iii) interest from Bon Simpanan Malaysia issued by Bank Negara Malaysia; (iv) interest derived from Malaysia and paid or credited by banks licensed under the Financial Services Act 2013 or the Islamic Financial Services Act ; (v) interest derived from Malaysia and paid or credited by any development financial institution prescribed under the Development Financial Institutions Act ; (vi) interest from sukuk originating from Malaysia, other than convertible loan stock, issued in any currency other than Ringgit and approved or authorized by, or lodged with, the Securities Commission or approved by the Labuan Financial Services Authority (LFSA) 3 ; and (vii) interest which is specifically exempted by way of statutory orders or any other specific exemption provided by the Minister. Discount Tax exemption is given on discount paid or credited to any unit trust in respect of investments as specified in items (i), (ii) and (iii) above. Foreign Sourced Income Dividends, interest and other income derived from sources outside Malaysia and received in Malaysia by a resident unit trust is exempt from Malaysian income tax. However, such income may be subject to tax in the country from which it is derived. Gains From The Realisation Of Investments Pursuant to Section 61(1) (b) of the MITA, gains from the realisation of investments will not be treated as income of the Fund and hence, are not subject to income tax. Such gains may be subject to real property gains tax (RPGT) under the Real Property Gains Tax Act 1976 (RPGT Act), if the gains are derived from the sale of chargeable assets, as defined in the RPGT Act. Goods And Services Tax ( GST ) On 1 April 2015, GST was implemented at the standard rate of 6% to replace the previous sales tax and service tax systems. Based on the Goods and Services Tax Act 2014 which was gazetted on 19 June 2014, the Fund, being a collective investment vehicle, will be making exempt supplies. Hence, the Fund is not required to be registered for GST purposes. The Fund will incur expenses such as management fees, trustee fees and other administrative charges which will be subject to 6% GST. The 6% input tax which may be incurred on such expenses will generally not be claimable by the Fund. TAXATION OF UNITHOLDERS For Malaysian income tax purposes, unitholders will be taxed on their share of the distributions received from the Fund. The income of unitholders from their investment in the Fund broadly falls under the following categories: 1. taxable distributions; and 2. non-taxable and exempt distributions. In addition, unitholders may also realise a gain from the sale of units. The tax implications of each of the above categories are explained below: 1. Taxable Distributions Distributions received from the Fund will have to be grossed up to take into account the underlying tax paid by the Fund and the unitholder will be taxed on the grossed up amount. Such distributions carry a tax credit, which will be available for set-off against any Malaysian income tax payable by the unitholder. Should the tax deducted at source exceed the tax liability of the unitholder, the excess is refundable to the unitholder. Please refer to the paragraph below for the income tax rates applicable to the grossed up distributions. 2 Effective from the year of assessment 2017, in the case of a wholesale fund which is a money market fund, the exemption shall only apply to a wholesale fund which complies with the criteria as set out in the relevant guidelines of the Securities Commission Malaysia. 3 Effective from the year of assessment 2017, the exemption shall not apply to interest paid or credited to a company in the same group or interest paid or credited to a bank licensed under the Financial Services Act 2013 or the Islamic Financial Services Act 2013; or a development financial institution prescribed under the Development Financial Institutions Act Taxation Adviser s Letter

21 2. Non-Taxable And Exempt Distributions Tax exempt distributions made out of gains from the realisation of investments and exempt income earned by the Fund will not be subject to Malaysian income tax in the hands of the unitholders. Rates Of Tax The Malaysian income tax chargeable on the unitholders would depend on their tax residence status and whether they are individuals, corporations or trust bodies. The relevant income tax rates are as follows: Unitholders Malaysian tax resident: Individual and non-corporate unitholders (such as associations and societies) Co-operatives 4 Trust bodies Corporate unitholders (i) A company with paid up capital in respect of ordinary shares of not more than RM2.5 million (at the beginning of the basis period for the year of assessment) 5 (ii) Companies other than (i) above Non-Malaysian tax resident (Note 2): Individual and non-corporate unitholders Corporate unitholders and trust bodies Malaysian Income Tax Rates Progressive tax rates ranging from 0% to 28% Progressive tax rates ranging from 0% to 24% 24% (Note 1) First RM500,000 of chargeable 19% 6 Chargeable income in excess of 24% (Note 1) 24% (Note 1) 28% 24% (Note 1) Note 1: The Income Tax (Exemption) (No. 2) Order 2017 [P.U.(A) 117], gazetted on 10 April 2017, exempts a qualifying person 7 from payment of income tax on an ascertained amount of chargeable income derived from the business source in the basis period for a year of assessment. This exemption is only applicable for the years of assessment 2017 and Pursuant to Paragraph 12(1), Schedule 6 of the MITA, the income of any co-operative society (a) in respect of a period of five years commencing from the date of registration of such co-operative society; and (b) thereafter where the members funds [as defined in Paragraph 12(2) of such co-operative society as at the first day of the basis period for the year of assessment is less than seven hundred and fifty thousand ringgit is exempt from tax. 5 A company would not be eligible for the 19% tax rate on the first RM500,000 of chargeable income if: (a) more than 50% of the paid up capital in respect of the ordinary shares of the company is directly or indirectly owned by a related company which has a paid up capital in respect of ordinary shares of more than RM2.5 million at the beginning of a basis period for a year of assessment; (b) the company owns directly or indirectly more than 50% of the paid up capital in respect of the ordinary shares of a related company which has a paid up capital in respect of ordinary shares of more than RM2.5 million at the beginning of a basis period for a year of assessment; (c) more than 50% of the paid up capital in respect of the ordinary shares of the company and a related company which has a paid up capital in respect of ordinary shares of more than RM2.5 million at the beginning of a basis period for a year of assessment is directly or indirectly owned by another company. 6 Effective from the year of assessment 2017, the tax rate is reduced from 19% to 18%. 7 In order to be a qualifying person, such person must be resident in Malaysia and: (a) a company incorporate under the Companies Act 2016; (b) a limited liability partnership registered under the Limited Liability Partnership Act 2012; (c) a trust body; (d) an executor of an estate of a deceased individual who was domiciled outside Malaysia at the time of his death; or (e) a receiver with respect to whom Section 68(4) of the MITA applies. The exemption order only applies to a qualifying person: (a) whose business has been in operation for not less than twenty four months; and (b) who has chargeable income from a source consisting of a business in the basis period for a year of assessment and the year of assessment immediately preceding that year of assessment and has made up its account for a period of twelve months ending on the same date for each of those years of assessment. The exemption order shall not apply to a qualifying person who in the basis period for a year of assessment: (a) has made a claim for reinvestment allowance under Schedule 7A to the MITA or investment allowance for service sector under Schedule 7B to the MITA; (b) has been granted any incentive under the Promotion of Investments Act 1986; (c) has been granted an exemption under section 127 of the MITA; (d) has made a claim for group relief under section 44A of the MITA; (e) is an investment holding company under section 60F or 60FA of the MITA; (f) is a unit trust which is defined under subsection 63C(5) of the MITA; or (g) has a debt that has been released under subsection 30(4) of the MITA. 18 Taxation Adviser s Letter

22 Note 2: Non-resident unitholders may be subject to tax in their respective countries depending on the provisions of the tax legislation in the respective countries and any existing double taxation arrangements with Malaysia. Gains From Sale Of Units Gains arising from the realisation of investments will not be subject to income tax in the hands of unitholders unless they are insurance companies, financial institutions or traders/dealers in securities. Unit Splits And Reinvestment Of Distributions Unitholders may also receive new units as a result of unit splits or may choose to reinvest their distributions. The income tax implications of these are as follows: Unit splits new units issued by the Fund pursuant to a unit split will not be subject to income tax in the hands of the unitholders. Reinvestment of distributions unitholders may choose to reinvest their income distribution in new units by informing the Manager. In this event, the unitholder will be deemed to have received the distribution and reinvested it with the Fund. ************************ We hereby confirm that, as at the date of this letter, the statements made in this letter correctly reflect our understanding of the tax position under the current Malaysian tax legislation and the related interpretation and practice thereof, all of which are subject to change, possibly on a retrospective basis. We have not been retained (unless specifically instructed hereafter), nor are we obligated to monitor or update the statements for future conditions that may affect these statements. The statements made in this letter are not intended to be a complete analysis of the tax consequences relating to an investor in the Fund. As the particular circumstances of each investor may differ, we recommend that investors obtain independent advice on the tax issues associated with an investment in the Fund. Yours faithfully Ernst & Young Tax Consultants Sdn Bhd Bernard Yap Partner Ernst & Young Tax Consultants Sdn Bhd has given its consent to the inclusion of the Taxation Adviser s Letter in the form and context in which it appears in this information memorandum and has not withdrawn such consent before the date of issue of this information memorandum. 19 Taxation Adviser s Letter