AIMS PROPERTY FUND PRODUCT DISCLOSURE STATEMENT. Entitlement Offer. MACARTHURCOOK A Member of AIMS Financial Group

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1 MACARTHURCOOK A Member of AIMS Financial Group AIMS PROPERTY FUND ST. KILDA ROAD (FORMERLY AUSTGROWTH PROPERTY SYNDICATE No.23) ARSN RESPONSIBLE ENTITY MACARTHURCOOK FUND MANAGEMENT LIMITED ACN AFSL No PRODUCT DISCLOSURE STATEMENT 17 OCTOBER 2013 Entitlement Offer A 15 for 10 pro-rata non-renounceable entitlement offer of New Units made to Existing Unitholders with (subject to any Entitlement Offer shortfall) Additional New Units available to Existing Unitholders and New Investors to raise up to $6,787,725 at an Application Price of 24.5 cents per New Unit. THIS IS AN IMPORTANT DOCUMENT THAT SHOULD BE READ IN ITS ENTIRETY. IF YOU DO NOT UNDERSTAND IT PLEASE CONSULT YOUR PROFESSIONAL ADVISERS. Entitlement will lapse for Existing Unitholders on 2 December 2013 Entitlement Offer closes for New Investors on 2 December 2013

2 Responsible Entity MacarthurCook Fund Management Limited ABN AFSL No Level 16, 323 Castlereagh Street Sydney NSW 2000 Tel Fax (02) Important Notice This product disclosure statement (PDS) is dated 17 October 2013 and contains a 15 for 10 pro-rata non-renounceable entitlement offer of New Units in the AIMS Property Fund (St. Kilda Road) (ARSN ) (Fund) made to Existing Unitholders with (subject to any Entitlement Offer shortfall) Additional New Units in the Fund available to Existing Unitholders and New Investors. Statements in this PDS are made only as of the date of this PDS unless otherwise specified. A copy of this PDS has been lodged with ASIC. ASIC takes no responsibility for the content of this PDS. The offer of New Units under this PDS is made by MacarthurCook Fund Management Limited (ABN , AFSL ) (MacarthurCook) as responsible entity of the Fund. Existing Unitholders and New Investors interested in the investment opportunity outlined in this PDS should conduct an independent investigation and analysis as to its merits and risks. MacarthurCook has not taken into consideration the individual objectives, financial situation or needs of any Investor. It is important to read this PDS in its entirety and seek professional advice when necessary in relation to any proposed investment. Nothing in this PDS constitutes financial product advice (nor investment, tax or legal advice) by MacarthurCook or a recommendation to invest in New Units. Neither MacarthurCook, nor its associates or directors, guarantee the performance of the Fund, the repayment of capital or an income return. Any forecast or other forward looking statement contained in this PDS may involve significant elements of subjective judgement and assumptions as to future events which may or may not be correct. There are usually differences between forecast or actual results because events and actual circumstances frequently do not occur as forecast and these differences may be material. Past performance is not indicative of future performance. It is particularly important that, in considering an investment in the Fund, you consider the risk factors that could affect the performance of the Fund (see section 5). You should carefully consider these factors in light of your personal circumstances (including financial and taxation issues) and seek professional advice before deciding whether to invest in the Fund. This PDS supersedes all preliminary information and other previous communications in connection with the Fund. All such preliminary information and previous communications should be disregarded. Any information or representation not contained in this PDS may not be relied on as having been authorised by MacarthurCook in connection with the Fund. MacarthurCook and its related bodies corporate, together with their directors and officers may hold Units in the Fund from time to time. The Entitlement Offer set out in this PDS is only available to those persons receiving this PDS (electronically or otherwise) within Australia. This PDS does not constitute an offer of Units in any jurisdiction in which, or to any person to whom, it would be unlawful to offer the New Units under this PDS. No action has been taken to register the Fund in any jurisdiction outside of Australia. The distribution of this PDS in jurisdictions outside Australia may be restricted by law and any person into whose possession the PDS comes (including nominees, trustees or custodians) should seek advice on and observe those restrictions. It is the responsibility of any overseas applicant to ensure compliance with all laws of any country relevant to their application. The return of a duly completed application form will be taken to constitute a representation and warranty that there has been no breach. This PDS is made available in electronic form on the Macarthurcook website at The electronic form of this PDS is available to persons within Australia. If you wish to apply for New Units you may either use the application form which accompanies this PDS, or print a copy of the application form and PDS from the above internet address. Certain information in this PDS is subject to change from time to time. Paper copies of updates to information which are not materially adverse to Existing Unitholders or New Investors are available free of charge by contacting MacarthurCook on (02) or writing to us at Level 16, 323 Castlereagh Street, Sydney NSW 2000 or from the MacarthurCook website at This information may include details about investment performance. MacarthurCook strongly recommends that Investors review this material before making a decision to acquire New Units in the Fund. In accordance with ASIC Regulatory Guide 198 Unlisted disclosing entities: Continuous disclosure obligations, MacarthurCook advises that it will fulfil its continuous disclosure requirements by way of website disclosure which complies with ASIC s good practice guidance. Existing Unitholders and New Investors may access material information regarding the Fund from MacarthurCook website at MacarthurCook authorises the use of this PDS as disclosure to New Investors who access the Fund through an IDPS or IDPS-like scheme (known commonly as a master trust or wrap account) or a nominee or custody service and those Unitholders may rely on this PDS. People who invest in the Fund through an IDPS do not become direct Unitholders in the Fund. The operator or custodian of the IDPS will be recorded as the Unitholder in the Fund and will be the person who exercises the rights and receives the benefits as a Unitholder. Reports and documentation relating to the Fund will be sent to the IDPS operator. Unitholders using these services should be aware that they may be subject to different conditions from those set out in this PDS, particularly in relation to: arrangements for the application and transfer of Units; fees and expenses; and distribution calculation and timing. Unitholders in IDPS s should contact their adviser or IDPS operator with any queries relating to an investment in the Fund using these services. Defined words and terms used in this PDS are set out in the Glossary in section 12. Photographs and illustrations in this PDS may or may not be photographs or illustrations of the Assets of the Fund. Currency amounts are stated in Australian dollars.

3 CONTENTS About AIMS From the Board Section 1 Key features of the Entitlement Offer and the Fund Section 2 Details of the Entitlement Offer Fund strategy and overview Section 3 Fund strategy and overview Section 4 Financial information Information for Existing Unitholders and New Investors Section 5 Risks Section 6 Fees and other costs Section 7 Taxation Section 8 Independent valuation of the Property Section 9 Responsible entity Section 10 Material agreements Section 11 Additional information Section 12 Glossary Application process Section 13 Instructions for applicants w Application form Key dates 1 Record Date 28 October 2013 Entitlement Offer opens 1 November 2013 Entitlement will lapse for Existing Unitholders 2 December 2013 Entitlement Offer closes to New Investors 2 December 2013 Allotment Date 13 December 2013 Mailing of Unitholder statements 20 December These dates are indicative only and are subject to change. MacarthurCook has the right to close the Entitlement Offer early or to extend or cancel the Entitlement Offer without notice. If the date the Entitlement Offer closes is varied, subsequent dates may also be varied accordingly. Unitholders and New Investors are encouraged to submit their application form as soon as possible after the Entitlement Offer opens. Entitlement Offer PDS 01

4 About AIMS About MacarthurCook MacarthurCook Fund Management Limited (MacarthurCook) is a wholly owned subsidiary of the AIMS Financial Group (AIMS), which specialises in the investment management of direct property, real estate securities and mortgage assets. MacarthurCook and AIMS manage approximately A$1.5 billion on behalf of over 20,000 Investors/borrowers as at 21 December 2012 and are the investment managers for MacarthurCook Office Property Trust, MacarthurCook Mortgage Fund, Advance Mortgage Fund and MacarthurCook Property Securities Fund. AIMS also manages, in a joint-venture arrangement with AMP Capital, the AIMS-AMP Capital Industrial REIT in Singapore. The MacarthurCook Property Securities Fund is listed on the ASX and the Singapore Exchange. The AIMS- AMP Capital Industrial REIT is listed on the Singapore Exchange. About AIMS Financial Group: Established in 1991, AIMS Financial Group (AIMS) is a diversified financial services and investment group with a solid track record and enviable reputation in the mortgage lending, fund management and securitisation markets in Australia, active in the areas of lending, securitisation, investment banking, funds management, property investment, stock exchange ownership and high-tech investment. Since 1999, AIMS has raised approximately A$4 billion in funds from the capital markets. Of this, AIMS has issued approximately A$3 billion residential mortgage-backed securities, with most of them rated AAA by both Standard & Poors and Fitch Ratings, and has originated over A$5 billion of high quality prime home loans since AIMS has actively introduced a number of international investors into the Australian markets and to date. AIMS has also attracted over A$1 billion of investments into Australia from overseas investors. AIMS is also the investment manager for AIMS funds, which amount to approximately A$1.5 billion fund as at 1 November AIMS head office is in Sydney, Australia, and it has businesses across Australia, China, Hong Kong and Singapore. Our highly qualified, professional and experienced cross-cultural teams enable AIMS to bridge the gap between Australia and China across various sectors. 02 AIMS Property Fund (St Kilda Road)

5 AIMS Financial Group Expands During GFC During the global financial crisis, AIMS expanded its business in a time when many other businesses were experiencing immense difficulties. In October 2008, AIMS acquired the Asia Pacific Stock Exchange (APX), which is the only Western Securities Exchange 100% owned by a private company. In April 2009, AIMS became the largest shareholder (15.8%) of the ASX listed fund manager, MacarthurCook Limited (MCK). In August 2009, AIMS holding increase to 54% and by November 2009, AIMS became the 100% owner of MCK which was subsequently delisted from the ASX. MacarthurCook Turnaround Story At the time of acquisition, MacarthurCook s fund management business was severely distressed with each of the 4 listed funds and a number of unlisted funds starved of capital and management expertise. Under AIMS leadership, MacarthurCook s funds have been turned around, stabilised and improved outcome for investors, for example: 1. The MacarthurCook Industrial REIT (MI-REIT) listed on the SGX (now known as AIMS AMP Capital Industrial REITs). At the time of the AIMS acquisition of MacarthurCook, MI-REIT was in distress and within three months, MI-REIT had to refinance S$225million plus S$91million obligation to purchase a property which previous management had entered into in 2007 without finance in place. At the time, MI-REIT s market capitalisation was approximately S$60million and S$544million funds under management. Since that time, AIMS has stabilised MI-REIT which has grown significantly with a market capitalisation S$647million and S$975million funds under management as at September The MacarthurCook Property Securities Fund (MPS) which is listed on the ASX and SGX. Since the takeover of MacarthurCook, through AIMS management, MPS has been able to significantly reduce its debt from A$44.5million with a gearing ratio of 38% to nil as at 31 May MPS is now uniquely positioned to access the capital markets in Australia and Asia through its dual listing on the ASX and SGX. 3. The privatisation of the MacarthurCook Industrial Property Fund (MIF) which was formerly listed on the ASX and was distressed at the time of acquisition. The share price of the fund at the time AIMS took over MacarthurCook was A$0.16. AIMS reduced vacancy in the MIF portfolio and improved the WALE to more than 5 years. In October 2010, unitholders voted in favour of accepting an offer from a US fund at A$0.44 per unit representing a 42% premium to the pre-announcement trading price. Entitlement Offer PDS 03

6 From the Board Dear Investors, MacarthurCook Fund Management Limited (MacarthurCook) in its capacity as responsible entity for the AIMS Property Fund (St. Kilda Road) ARSN (Fund) is pleased to present the AIMS Property Fund (St. Kilda Road) Entitlement Offer (Entitlement Offer). About the Entitlement Offer The Entitlement Offer presents an opportunity for Existing Unitholders and New Investors to subscribe for New Units in the Fund at an Application Price of 24.5 cents per New Unit. MacarthurCook invites applications from each Existing Unitholder for New Units in the Fund through a prorata non-renounceable entitlement offer of 15 New Units for every 10 Units held by an Existing Unitholder on the Record Date. Existing Unitholders may also apply for Additional New Units over and above their Entitlement. MacarthurCook also invites applications from New Investors for Additional New Units not taken up by Existing Unitholders. The Fund is seeking to raise up to $6,787,725 under the Entitlement Offer (Raising Amount). What is the purpose of the Entitlement Offer? The purpose of the Entitlement Offer is to raise funds to repay the Fund s debt to achieve an LVR for the Fund of approximately 50%. If this is achieved, it should enable the Fund to undertake capital expenditure and fund tenancy incentives in order to maximise the value of the Property. New Units will carry a preferential right to annualised distributions at a rate of 8.5% 2 per annum for the period from the date of issue to 31 December After 31 December 2015, New Units will rank equally with Ordinary Units for all distributions of income. 2 Annualised distribution of 8.5% p.a. is based on the Application Price of $0.245 per New Unit. 04 AIMS Property Fund (St Kilda Road)

7 About the AIMS Property Fund (St. Kilda Road) The AIMS Property Fund (St. Kilda Road), formerly named the Austgrowth Property Syndicate No. 23, is a closed ended unlisted property fund established in 2004 by Austgrowth Property Syndicates Limited that acquired a 13 level commercial office building located at 492 St. Kilda Road, Melbourne (Property). At a meeting of Unitholders held on 10 October 2012, resolutions were passed giving effect to the appointment of MacarthurCook as the new responsible entity of the Fund. The key strategy MacarthurCook is implementing in relation to the Fund is to reduce debt and reinstate income distributions, whilst maximising the value of the Property. We believe the Entitlement Offer is a vital part of this strategy. At a meeting of Unitholders held on 26 July 2013, Unitholders approved amendments to the Constitution to facilitate the Entitlement Offer. Further Information This PDS contains detailed information about the Entitlement Offer and you should read it in its entirety. If you are in any doubt as to the course of action you should follow, please consult with your financial adviser or professional service provider. We invite your participation in the Entitlement Offer and thank you for your on-going support of the Fund. Yours sincerely George Wang John Love Richard Nott CEO and Chairman Independent Director Independent Director MacarthurCook Fund Management Limited Entitlement Offer PDS 05

8 Section 1 Key features of the Entitlement Offer and the Fund The key features, benefits and risks set out in this section are a summary only. You should read this entire PDS before completing the application form as this PDS contains important information about an investment in the Fund. You should also consider seeking independent legal, taxation and financial advice before deciding whether or not to invest under the Entitlement Offer. Key features of the Entitlement Offer The Entitlement Offer Entitlement Offer features Further details The Entitlement Offer The offer comprises: a pro-rata non renounceable entitlement offer to Existing Unitholders to acquire 15 New Units for every 10 Ordinary Units held on the Record Date at the Application Price. Existing Unitholders may apply for Additional New Units over and above their Entitlement (subject to a pro rata scale back should there be oversubscriptions); and an offer to New Investors to apply for Additional New Units not taken up by Existing Unitholders (subject to a pro rata scale back should there be oversubscriptions);. Section 2 Key dates Record Date 28 October 2013 Entitlement Offer opens 1 November 2013 Entitlement Offer will lapse for Existing Unitholders 2 December 2013 Entitlement Offer closes to New Investors 2 December 2013 Allotmenet Date 13 December 2013 Mailing of Unitholder statements 20 December 2013 Page 12 Raising Amount The Fund is seeking to raise up to $6,787,725. Section 2 Minimum application amount The minimum application amount is: nil for existing Unitholders; and $10,000 for New Investors. Section 2 Purpose of the Entitlement Offer The purpose of the Entitlement Offer is to: repay debt; and reinstate regular income distributions to Unitholders. Section 2 Application Price 24.5 cents per New Unit. Discount to NTA The Application Price represents: a 26.9% discount to the NTA per Unit as at 30 June 2013; and a 11.6% discount to the pro forma NTA per Unit following the issue of New Units under the Entitlement Offer 3. Section 2 Preferential rights of New Units New Units will carry: a preferential right to annualised distributions at a rate of 8.5% per annum for the period from the date of issue to the 31 December After 31 December 2015, New Units will rank equally with Ordinary Units for all distributions of income; and a preferential right of redemption. Sections 2 and 11.2 Ranking of New Units Other than specified above in relation to preferential distribution and redemption rights, the New Units will rank equally in all respects with Ordinary Units. New Units will have the same right to receive notices, reports and accounts and to attend, be heard and vote at all meetings of Unitholders of the Fund on the same basis as holders of Ordinary Units. Sections 2 and 11.2 Cooling off No cooling off period applies to this Entitlement Offer. Section Fees and costs The Responsible Entity does not intend to charge any fees in relation to this Entitlement Offer. The costs associated with the Entitlement Offer will be paid from the funds raised from the Entitlement Offer. The Responsible Entity is entitled to be paid from the Fund other fees and expenses that relate to the management of the Fund. Section 6 3 This assumes the maximum Raising Amount of $6,787,725 is raised under the Entitlement Offer. 06 AIMS Property Fund (St Kilda Road)

9 The Entitlement Offer Entitlement Offer features Further details Risks There are various risks in relation to the Entitlement Offer, the Fund and the Property. These risks are described in detail in section 5 and you should read that section carefully. Section 5 Key benefits The key benefits associated with an investment in the Fund under the Entitlement Offer include: the opportunity to acquire New Units at a potentially significant discount to the NTA as at 30 June 2013; the net proceeds of the Entitlement Offer will be used to reduce the Fund s debt level; the preferential payment of income distribution in respect to New Units; MacarthurCook expects, but does not guarantee, that distributions in respect to Ordinary Units will recommence following the successful close of the Entitlement Offer with effect from the quarter ending 31 December Section 2 Key features of the Fund The Fund Fund features 4 Further details Investment type The Fund is a single asset closed ended unlisted unit trust which owns a commercial office building located at 492 St. Kilda Road, Melbourne. Section 3 Responsible entity MacarthurCook is the Responsible Entity of the Fund. MacarthurCook is a wholly owned subsidiary of AIMS. AIMS acquired MacarthurCook in Since then, it has managed approximately $1.5 billion in funds. Section 9 Fund commenced October 2004 Number of tenants 32 Section 3 Occupancy rate 83.7% (by area) Section 3 WALE 1.9 years (by gross income) Section 3 Distribution status The Fund has not paid any income distributions since July 2009 as a result of the relatively high LVR. Under the Entitlement Offer, the Fund intends to pay an 8.5% annualised distribution yield in respect of each New Unit for the period from the date of issue to 31 December After 31 December 2015, New Units will rank equally with Ordinary Units for all distributions. In addition, MacarthurCook expects, but does not guarantee, that distributions of income in respect of Ordinary Units will recommence following the successful close of the Entitlement Offer with effect from the quarter ending 31 December However there are a number of factors that may prevent the payment of distributions such as the income the Fund receives and the Fund s financial commitments. Sections 2, 4 and 11.4 Liquidity and Fund term Unitholders should consider their investment in the Fund to be illiquid. At a meeting of Unitholders on 10 October 2012, Unitholders resolved to extend the term of the Fund by a further 3 years to 31 December Sections 2, 3 and All figures are as at 30 June 2013 unless otherwise stated. Entitlement Offer PDS 07

10 Benchmarks and Disclosure Principles Summary The table below sets out ASIC s benchmarks and disclosure principles for unlisted property fund managers under ASIC Regulatory Guide 46 unlisted property schemes: improving disclosure for retail investors (RG46). This information is intended to assist you in understanding the key issues affecting the risks and returns of the Fund and deciding whether the Entitlement Offer and an investment in the Fund is suitable for you. The table below should be read in conjunction with section 5 which details some of the major risks of an investment in the Fund and the further information referred to in the table. The table shows each of ASIC s six benchmarks and includes a summary of the eight key disclosures required under RG46 and a reference to where further information is located in the PDS. Updated information will be made available on MacarthurCook s website at Risk features Benchmark 5 Benchmark met Gearing MacarthurCook maintains and complies Yes with a written policy that governs the level of gearing at an individual credit facility level under which it seeks to maintain a maximum Bank LVR of 75%. Disclosure principle 6 The Fund has a gearing ratio of 72.34%. If the Entitlement Offer is fully subscribed, the gearing ratio of the Fund is anticipated to decrease to approximately 50%. Further information Page 16 Interest cover MacarthurCook maintains and complies with a written policy that governs the level of interest cover at an individual credit facility level under which it seeks to maintain a minimum Bank ICR of 1.5 times. No The Fund has an ICR of 1.2 times Page 17 Interest capitalisation The interest expense of the Fund is not capitalised. Yes No ASIC disclosure principle Page 17 Scheme borrowing No ASIC benchmark The Fund currently has two debt facilities, the loan under the Senior Debt Facility and the Subordinated Loan. Page 34 Portfolio diversification No ASIC benchmark The sole asset of the Fund is the Property. Page 13 Valuation policy MacarthurCook maintains and complies with a written valuation policy that meets ASIC s benchmark Yes No ASIC disclosure principle Page 17 Related party transactions MacarthurCook maintains and complies with a written policy on related party transactions, including the assessment and approval processes for such transactions and arrangements to manage conflicts of interest. Yes The Fund has in place arrangements for dealing with related party transactions. Page 37 Distribution practices The Fund will only pay distributions from its cash from operations (excluding borrowings) available for distribution. Yes Distributions to be paid from cash from operations available for distribution. Pages 17 and 36 Withdrawal arrangements No ASIC benchmark A withdrawal from the Fund is only possible when MacarthurCook makes a withdrawal offer. Page 36 Net tangible assets No ASIC benchmark The NTA per Unit was $0.33 as at 30 June Page 14 5 RG46 requires the gearing policy and interest cover policy to be measured on an individual credit facility level, and accordingly these policies are calculated using the applicable Bank LVR and Bank ICR covenant formulae in the Senior Debt Facility. These formulae are different to the gearing ratio and interest cover ratio formulae referred to in the associated disclosure principles which are calculated at the fund level in accordance with the formulae set out in RG46. 6 The information in this PDS relating to disclosure principles 1 (gearing), 2 (interest cover) and 3 (scheme borrowings) are presented on a pro forma basis based on the audited 30 June 2013 accounts and assuming the maximum amount of funds is raised under the Entitlement Offer. 08 AIMS Property Fund (St Kilda Road)

11 Section 2 Details of the Entitlement Offer About the Entitlement Offer The Entitlement Offer consists of an opportunity for Existing Unitholders and New Investors to subscribe for New Units in the Fund at the Application Price. MacarthurCook will offer million New Units in the Fund through a pro-rata non-renounceable entitlement offer of 15 New Units for every 10 Units held on the Record Date. Existing Unitholders may apply for Additional New Units over and above their Entitlement (subject to a pro rata scale back if there are oversubscriptions). New Investors may apply for Additional New Units which are not taken up by existing Unitholders (Subject to a pro rata scale back if there are oversubscriptions). The Fund is seeking to raise up to $6,787,725 through the Entitlement Offer. The Entitlement Offer is NOT underwritten. Sources and application of funds The table below shows the intended sources and application of funds in relation to the Entitlement Offer. Sources of Funds Funds raised from the Entitlement Offer $6,787,725 Application of Funds Repay Subordinated Loan $389,719 Partially repay loan under Senior Debt Facility $6,248,006 Cost of the Entitlement Offer $150,000 7 Total Application of Funds $6,787,725 MacarthurCook intends to use the net proceeds of the Entitlement Offer to reduce the Fund s debt to achieve an LVR of approximately 50%. If this is achieved, it should enable the Fund to undertake capital expenditure and fund tenancy incentives in order to maximise the value of the Property. Discount to NTA per Unit The Application Price represents a 26.9% discount to the NTA per Unit as at 30 June 2013, and a 11.6% discount to the pro forma NTA per Unit as at 30 June 2013 following the issue of New Units under this Entitlement Offer 8. The NTA of the Fund is the value of the Assets less the Fund s liabilities (including any appropriate provisions). Further information about the calculation of NTA is included in section 4. Entitlement will lapse if not taken up Entitlements which are not taken up before the Entitlement Offer closes will lapse. Please refer to the key dates set out on page 12 for further detail. Allotment policy If not all of the available New Units are taken up by Existing Unitholders in accordance with their Entitlement, those units (Additional New Units) may be issued to Existing Unitholders who have subscribed for more than their Entitlement and a pro rata scale back will apply if there are oversubscriptions. Any Additional New Units not taken up by Existing Unitholders will then be made available to New Investors (subject to a pro rata scale back if there are oversubscriptions). Underwriting The Entitlement Offer is not underwritten. The Fund is seeking to raise a maximum amount of $6,787,725 under the Entitlement Offer. MPS actual and potential Unitholding in the Fund MPS, which is a listed property securities fund managed by MacarthurCook, holds 3,500,000 Units in the Fund (being 18.95% of Units on issue). MPS intends to subscribe for its pro rata entitlement of New Units under the Entitlement Offer and also intends to apply for Additional New Units subject to it not acquiring 50% or more of the Units in the Fund. The holding in the Fund controlled by MPS (Relevant Interest) immediately following the completion of the Entitlement Offer will depend on the subscription for New Units by Existing Unitholders and New Investors however it will at no point acquire 50% or more of the Units in the Fund. The following table illustrates how the Relevant Interest of MPS may increase as a result of the extent by which third parties participate in the Entitlement Offer. 7 This figure is an approximate only and excludes GST. 8 The Application Price represents a 11.6% discount to the pro forma NTA per Unit as at 30 June 2013 following the issue of Entitlement Units under this Entitlement Offer assuming a 100% take up rate. Entitlement Offer PDS 09

12 Non MPS participation in the Entitlement Offer Other Unitholders holding post Entitlement Offer 0% % 49.99% 25% % 49.99% 50% 56.74% 43.26% 75% 68.89% 31.11% 100% 81.05% 18.95% MPS holding post Entitlement Offer The risks associated with an increase in the holding of MPS in the Fund due to the Entitlement Offer are discussed further in section 5. Frequently asked questions What is the purpose of the Entitlement Offer? The purpose of the Entitlement Offer is to raise funds to repay the Fund s debt to achieve an LVR of approximately 50%. If this is achieved, it should enable the Fund to undertake capital expenditure and fund tenancy incentives in order to maximise the value of the Property. Who is entitled to participate in the Entitlement Offer? The Entitlement Offer is open to all Existing Unitholders on the register of the Fund on the Record Date. If Existing Unitholders do not take up their full Entitlement, other Existing Unitholders and New Investors will be able to acquire Additional New Units. What are my Entitlements under the Entitlement Offer? If you are an Existing Unitholder, you are entitled to subscribe for 15 New Units for every 10 Ordinary Units you hold on the Record Date. Can I subscribe for more than my Entitlement? Yes. You are welcome to apply for as many New Units as you would like. If the Entitlement Offer is not fully subscribed and you applied for New Units over and above your Entitlement, then you will be allocated Additional New Units on a pro rata basis. Any New Units not taken up by Existing Unitholders will then be made available to New Investors. Can I transfer my Entitlement to another party? As this is a non-renounceable offer you are not able to transfer your Entitlement to a third party. What are my options? You are not obliged to take up your full Entitlement. The options for Existing Unitholders are as follows: take up your full Entitlement; take up part of your Entitlement; apply for Additional New Units in excess of your Entitlement that may become available; or allow your Entitlement to lapse. 9 The maximum amount of funds raised under the Entitlement Offer will be $2.8 million if MPS subscribes for its pro rata entitlement and applies for Additional New Units such that MPS interest post Entitlement Offer is no more than 50% in the Fund and there is a 0% participation rate from other Unitholders. 10 The maximum amount of funds raised under the Entitlement Offer will be $5.6 million if MPS subscribes for its pro rata entitlement and applies for Additional New Units such that MPS interest post Entitlement Offer is no more than 50% in the Fund and there is a 25% participation rate from other Unitholders. 10 AIMS Property Fund (St Kilda Road)

13 What happens if I do NOT take up my Entitlement or I do NOT take up my full Entitlement? If you do not participate in the Entitlement Offer and the Entitlement Offer is fully subscribed, the value of your interest in the Fund will be diluted by approximately 17.2%. You are able to apply for an amount less than your Entitlement. Any participation by an Existing Unitholder in the Entitlement Offer will reduce the level of dilution in the Fund for that Existing Unitholder. The effect that the issue of New Units could have on the value of an Existing Unitholder s holding in the Fund, assuming the Entitlement Offer is fully subscribed is shown in the following table. Overall non MPS participation in the Entitlement Offer Amount of funds raised under the Entitlement Offer ($ 000) 0% 9 $0 17.2% 25% 10 $ % 50% $ % 75% $ % 100% $ % Value of dilution 11 The table above illustrates the potential for dilution of value of an Existing Unitholder s interest in the Fund assuming the Entitlement Offer is fully subscribed. This is a different measure to the potential decrease in aggregate percentage ownership outlined on page 10. Is the Entitlement Offer underwritten? No, the Entitlement Offer is NOT underwritten. The Fund is seeking to raise up to a maximum amount of $6,787,725 under the Entitlement Offer. Availability of Additional New Units The availability of Additional New Units will depend on the extent to which Existing Unitholders take up their Entitlement. Existing Unitholders can subscribe for Additional New Units by applying for a number of New Units in excess of their Entitlement. Existing Unitholders are not guaranteed to receive any Additional New Units. If applications for Additional New Units exceeds the number of Additional New Units which are available, then MacarthurCook will scale back applications for Additional New Units from Existing Unitholders on a pro-rata basis according to their existing holdings in the Fund on the Record Date. New Units will then be made available to New Investors. New Investors If you are a New Investor who wishes to participate in the Entitlement Offer, then you should complete the New Investor application form in this PDS in accordance with the instructions set out in section 13 and on the form and return it, together with the Application Amount. The minimum investment amount for New Investors is $10,000. MacarthurCook cannot guarantee the availability of any Additional New Units for New Investors. In the event there are oversubscriptions, the applications of New Investors will be scaled back on a pro rata basis. 11 Calculated as the number of Units held multiplied by the NTA per Unit before the issue of New Units compared to the number of Units held multiplied by the NTA per Unit after the issue of New Units following the completion of the Entitlement Offer. Entitlement Offer PDS 11

14 Will New Units be eligible to receive distributions and if so, when? Yes, New Units will carry a preferential right to annualised distributions at a rate of 8.5% 12 per annum or cents per annum for the period from the date of issue to 31 December After 31 December 2015, New Units will rank equally with Ordinary Units for all distributions of income. The table below shows the forecast distribution per Ordinary Unit and New Unit for the period 1 July 2013 to 30 June 2014 at various take up rates for the Entitlement Offer 13. Participation rate of Non- MPS Unitholders Forecast distribution per Ordinary Unit available for distribution for the period 1/07/13 to 30/06/14 Distribution per New Unit for the period 1/07/13 to 30/06/14 0% 1.2 cents cents 25% 1.0 cents cents 50% 0.9 cents cents 75% cents cents 100% cents cents If the New Units under this Entitlement Offer are allotted in November 2013, as currently expected, then the first distribution is expected to be paid in January 2014 for the quarter ending 31 December What are the redemption rights of New Units? New Units will carry a preferential right of redemption such that each New Unit will be redeemed (at a redemption price equal to the prevailing NTA per Unit less transaction costs as at the redemption date) on the earlier to occur of: the later of 31 December 2015 and the date which Unitholders determine as the extended term of the Fund pursuant to the Constitution; the date the Responsible Entity determines the purpose of the Fund has been, or cannot be accomplished; the date immediately following completion of the sale of the Property; the date immediately prior to the date a court orders the winding-up of the Fund; the date a resolution is passed by the requisite majority either by the Responsible Entity or by Unitholders in accordance with the Constitution and all relevant law for the termination of the Fund; and the date on which an administrator, liquidator, receiver or similar entity is appointed to the Fund. What other rights do New Units have? Apart from the preferential income distribution and redemption rights set out above, holders of New Units have the same rights to receive notices, reports and accounts and to attend, be heard and vote at all meetings of Unitholders of the Fund on the same basis as the holders of Ordinary Units. Can I currently withdraw my investment in the Fund? The ability of Unitholders to withdraw an investment from the Fund is limited by the terms of the Constitution. Further details in relation to withdrawal arrangements are set out in section Unitholders are unlikely to have any ability to withdraw prior to the end of the term of the Fund, and therefore an investment in the Fund should be regarded as illiquid. How can I obtain further information about the Entitlement Offer? If after having read this PDS you have further questions in relation to the Entitlement Offer, please contact your financial adviser or MacarthurCook on (02) Key dates 16 Record Date 28 October 2013 Entitlement Offer opens 1 November 2013 Entitlement will lapse for Existing Unitholders 2 December 2013 Entitlement Offer closes to New Investors 2 December 2013 Allotment Date 13 December 2013 Mailing of Unitholder statements 20 December Annualised distribution of 8.5% p.a. is based on the Application Price of $0.245 per New Unit. 13 The forecasts have been prepared on the basis of best estimate assumptions. However factors affect the forecasts that are outside the control of MacarthurCook. As such the MacarthurCook cannot provide assurance that the forecast will be achieved or that the Fund will be able to make the forecasts distributions. Please refer section 4 for more detail regarding the forecasts. 14 Assuming MPS applies for Additional New Units such that its interest in the Fund is no more than 50% of the Units in the Fund. 15 Assuming MPS applies for Additional New Units such that its interest in the Fund is no more than 50% of the Units in the Fund. 16 These dates are indicative only and are subject to change. MacarthurCook has the right to close the Entitlement Offer early or to extend or cancel the Entitlement Offer without notice. If the date the Entitlement Offer closes is varied, subsequent dates may also be varied accordingly. Investors are encouraged to submit their application form as soon as possible after the Entitlement Offer opens. 12 AIMS Property Fund (St Kilda Road)

15 Section 3 Fund strategy and overview Investment strategy The Fund owns a single property asset located at 492 St. Kilda Rd, Melbourne. The Property comprises a 13 level commercial office building constructed around 1971, which has undergone various refurbishments since it was initially built with major internal and external refurbishments being conducted in 1998 and The property current has a total of 32 tenants. Fund s strategy MacarthurCook is focused on implementing an active management strategy for the Fund in order: to improve the capital structure of the Fund; to increase the Property s annual net rental income; to increase the occupancy rate of the Property; to reinstate distributions to Unitholders; and to maximise the sale price of the Property in the future. MacarthurCook believes that the deleveraging of the balance sheet of the Fund which is intended to facilitate the reinstatement of distributions represents an important step in the implementation of the overall strategy for the Fund. MacarthurCook may consider reinvesting capital in to the Property over the next 12 months if it is considered that the reinvestment will enhance the value of the Property. Property summary The Fund is a single asset vehicle. The following table provides a summary of the key features of the Property. Property Ownership NLA (m 2 ) Occupancy rate (%) St. Kilda Rd, Melbourne WALE (years) 18 Capitalisation Rate 19 Independent valuation 100% 8, % % Knight Frank Valuations Valuation date 30/9/13 Property lease expiry profile This graph illustrates the percentage of the Property of the Fund in terms of NLA and gross income which expires in each financial year. 35% 30% 25% 20% 15% 10% 5% 0% FY14 FY15 FY16 FY17 FY18 FY19 NLA (% of income) Gross income (% of income) Lease expiry profile by NLA This table illustrates the percentage of the total NLA which will expire in each upcoming financial year. Expires During FY14 FY15 FY16 FY17 FY18 FY19 (%) Major tenants This table illustrates the tenants that constitute 5% or more of the Fund s NOI. Tenant Percentage of Fund s NOI Percentage NLA Lease expiry date Headstart International Pty Ltd 7.2% 6.4% 31-Oct-15 Peet Limited 9.3% 8.1% 30-Apr-18 Aquasure Pty Ltd 6.4% 5.3% 07-Jan-14 Avaya Australia Pty Ltd 6.6% 5.4% 14-Mar-15 Profectus Australia Pty Ltd 6.6% 5.5% 14-Aug Occupancy rate is the percentage of the total NLA that is currently leased (%). 18 WALE is the average lease term remaining to expiry across the Property weighted by gross income (years). 19 Capitalisation rate is the ratio between NOI and the current market value of the Property. Entitlement Offer PDS 13

16 Section 4 Financial information This section contains details about the Fund s financial position as at 30 June 2013 and the pro forma financial position based on the balance sheet as at 30 September 2013 adjusted for the proceeds of the Entitlement Offer. This section also contains details about the Fund s target distributions, financial risk management policy, valuation policy and borrowings. The following table shows the audited balance sheet of the Fund as at 30 June 2013 and the pro forma balance sheet based on the balance sheet as at 30 September 2013 adjusted for the proceeds of the Entitlement Offer. The 30 June 2013 balance sheet shown below has been extracted from the Financial Reports for the financial year ending 30 June 2013 and has been prepared in accordance with Australian Accounting Standards audited. Balance sheet Pre Entitlement Offer as at 30 June 2013 ($) Position at 30 September 2013 ($) Assets Cash and Receivables 410, , ,262 Other Current Assets 487, , ,693 Property 21 24,419,768 24,433,248 24,433,248 Total Assets 25,317,358 25,309,203 25,309,203 Pro forma Post Entitlement Offer 20 ($) Liabilities Trade and Other Payables 249, , ,234 Provisions 130, , ,756 Subordinated Loan 389, ,719 - Senior Debt Facility 18,139,506 18,162,631 11,914,625 Other liabilities 221, , ,465 Total Liabilities 19,130,442 19,142,804 12,505,079 Net Assets 6,186,916 6,166,399 12,804,124 Units on Issue 18,470,000 18,470,000 46,175,000 NTA per Unit $ $ $ Debt to Total Assets Ratio 73.88% 73.90% 47.68% Debt to Property Ratio 74.82% 74.82% 48.27% Net tangible assets The NTA per Unit calculation provided by ASIC is as follows: NTA per Unit = Net assets intangible assets +/- any other adjustments Number of units in the Fund on issue The NTA does not represent the return a Unitholder will receive on final settlement as it does not consider selling and disposal costs, future performance, or achieved sale price. The NTA should be used as a guide only to help Unitholders understand the value of the Assets upon which the value of their Unit is determined and is calculated using the latest valuation. The NTA of cents per Unit in the table above is based on the audited balance sheet of the Fund as at 30 June The proforma NTA assuming the maximum amount of funds are raised under the Entitlement Offer) is cents per Unit and is the value of the Fund s Assets less the Fund s liabilities. 20 The pro forma balance sheet is based on the Entitlement Offer being fully subscribed. 21 Austgrowth Property Syndicates Limited as responsible entity for the Austgrowth Property Syndicate No. 23 (former name of the Fund) initially acquired the Property for $37,300,000 including fees and costs in relation to the transaction. 14 AIMS Property Fund (St Kilda Road)

17 Fund borrowing Existing Unitholders and New Investors should consider information about the Fund s borrowings, particularly in relation to the Fund s borrowing maturity profile and any breaches of loan covenants. Existing Unitholders and New Investors should be aware that their interest in the Fund will generally rank behind lenders and other creditors. This means, if the Fund was to be wound-up, then the Fund s lenders and other creditors would be repaid first, before any capital or outstanding distributions were paid to Unitholders. Existing Unitholders and New Investors should also refer to the risks detailed in section 5 of this PDS, including in relation to banking obligation risk and interest rate risk. As at 30 June 2013, the Fund had a total debt of $ million (comprising approximately of $ million senior debt and $390,000 subordinated debt). The Fund is seeking to raise $6,787,725 under the Entitlement Offer. The table below shows the Fund s debt position pre and post the Entitlement Offer assuming the maximum amount of funds are raised under the Entitlement Offer. Fund borrowings Outstanding Senior Debt 22 ($ 000) Outstanding Subordinated Loan ($ 000) Total debt ($ 000) As at 30 June , ,875 Post completion of Entitlement Offer 12,067-12,067 Security for the Senior Debt Facility consists of a first ranking mortgage over the Property, plus a general security over the Fund. Security for the Subordinated Loan consists of a second ranking mortgage over the Property. Loan terms and financial covenants Most borrowing facilities contain covenants relating to such items as loan to value ratio (Bank LVR) 23 and debt service coverage (Bank DSC) 24. A breach of a borrowing covenant may result in a lender being able to require immediate repayment of the facility. If this occurs, then the Fund could be forced to arrange alternative financing in a short timeframe. Depending on the prevailing market conditions and other circumstances this could be difficult for the Fund. There is also a risk refinancing will be on less favourable terms or not available at all. As at 30 June 2013, the Fund is not in breach of any financial covenants and MacarthurCook is not currently aware that any financial covenants are likely to be breached. On completion of the Entitlement Offer, depending on the take up rate, the Bank LVR of the Fund based on the value of the Property as at 30 June 2013 is: Participation rate Outstanding Senior Debt 22 ($ 000) Bank LVR 0% 18, % 25% 17, % 50% 15, % 75% 13, % 100% 12, % Under the Senior Debt Facility the Fund is required to have a maximum Bank LVR of 75% and a minimum Bank DSC of at least 1.45 times. Sensitivity to change in valuation The Fund will be in breach of its Bank LVR covenant of 75% if the Property value falls by more than -2.5%, assuming the amount outstanding under the Senior Debt Facility remains at $ million. The following table shows the sensitivity of movements in the Property value and the Bank LVR under the Senior Debt Facility, assuming the Entitlement Offer does not proceed. Valuation movement 25 Resulting Bank LVR +5.0% 69.77% +2.5% 71.49% -2.5% 75.14% -5.0% 77.12% 22 These figures exclude the amortised borrowing costs. 23 The Bank LVR is calculated as the amount outstanding under the Senior Debt Facility divided by the current market value of the Property of $25.0 million. 24 The Bank DSC is calculated as the net operating income for the relevant period divided by the debt service figure for the relevant period. 25 Valuation movement from independent valuation of $25.0 million dated 3 September Entitlement Offer PDS 15

18 Sensitivity to change in operating cashflow The Fund will not be in breach of its Bank DSC covenant of 1.45 times unless the Property s net operating income falls by more than 13%. On completion of the Entitlement Offer, depending on the take up rate, the Bank DSC of the Fund based on the Property s net operating income for the financial year ending 30 June 2013 is: Participation rate Debt service figure ($ 000) Bank DSC 0% 1, times 25% 1, times 50% 1, times 75% times 100% times The following table shows the sensitivity of movement in operating cashflow and the Bank DSC under the Senior Debt Facility, assuming the Entitlement Offer does not proceed. NOI (from 30 June 2013) Resulting Bank DSC +5.0% 1.75 times +2.5% 1.71 times -2.5% 1.62 times -5.0% 1.58 times Gearing Gearing ratio After completion of the Entitlement Offer, assuming the maximum amount of funds are raised under the Entitlement Offer, the gearing ratio of the Fund is expected to be 47.68% based on amount outstanding under the Senior Debt Facility of $ million. The gearing ratio represents the extent to which the assets of a fund are financed by debt. A higher gearing ratio means a higher reliance on external liabilities (primarily borrowings) to fund the assets and exposes the fund to increased costs if interest rates rise. A highly geared fund has a lower asset buffer to rely upon in times of financial stress. Investors can use the gearing ratio to assess the potential risks a fund may face in the event interest rates rise or property values decrease, and to compare the risk associated with the fund s return on investment to other similar products. Under RG46, gearing ratio is calculated as: Gearing ratio = Total interest bearing liabilities Total Assets The liabilities and assets of the Fund used to calculate the gearing ratio are based on the audited balance sheet of the Fund as at 30 June 2013 adjusted for the application of the proceeds from the Entitlement Offer, assuming the maximum amount of funds is raised under the Entitlement Offer. Based on the calculation method above, the gearing ratio of the Fund as at 30 June 2013 is 72.34%. The table below shows the gearing ratio of the Fund based on the take up rate of the Entitlement Offer. Participation rate Outstanding Senior Debt Gearing ratio ($ 000) 0% 18, % 25% 17, % 50% 15, % 75% 13, % 100% 12, % 16 AIMS Property Fund (St Kilda Road)

19 Interest cover Investors can use the ICR 26 to consider whether a fund can meet ongoing interest payments and therefore service debt from its earnings. It is a key measure of the risks associated with a fund s level of borrowings and the sustainability of borrowings. The ICR also provides an indication of the ability of a fund to pay expenses of the fund after the payment of its interest expenses and whether the income of the fund is sufficient to cover these expenses. The lower the interest cover, the higher the risk a fund will not be able to meet its interest payments and other expense payments. A fund with a low interest cover only needs a small reduction in earnings (or a small increase in interest and other expenses) to be unable to meet its interest payments. Interest cover = EBITDA unrealised gains + unrealised losses Interest expense The EBITDA and interest expense figures used to calculate the ICR are based on the audited accounts of the Fund as at 30 June 2013 adjusted for the application of the proceeds from the Entitlement Offer, assuming the maximum amount of funds is raised under the Entitlement Offer. Based on the calculation method above, the ICR of the Fund as at 30 June 2013 is 1.33 times assuming the maximum amount of funds is raised under the Entitlement Offer. This indicates that the Fund has sufficient earnings to satisfy its interest payments. The table below shows the gearing ratio of the Fund based on the take up rate of the Entitlement Offer. Participation rate ICR 0% 1.20 times 25% 1.22 times 50% 1.25 times 75% 1.29 times 100% 1.33 times The interest expense of the Fund is not capitalised. Distribution practices New Units will carry a preferential right to annualised distributions at a rate of 8.5% 27 per annum or cents per annum for the period from the date of issue to the 31 December 2015, being the date the Fund term is expected to expire. After 31 December 2015, New Units will rank equally with Ordinary Units for all distributions of income. The above annualised distributions are estimated based on the following key assumptions: Assumption Commentary Annual rent reviews 3.5% per annum Inflation 3.0% per annum Leasing downtime 6 months Average occupancy rate 93.88% It is the intention of the Responsible Entity to reinstate regular income distribution for Unitholders holding Ordinary Units in the Fund from the quarter ending 31 December Distributions will only be paid to Unitholders from cash from the operations of the Fund (excluding borrowings) available for distribution. Valuation policy MacarthurCook has a written valuation policy with which the Fund complies. Under the valuation policy, property is measured on a fair value basis, being the amount for which the property could be exchanged between willing parties in an arm s length transaction, based on current prices in an active market for similar properties in the same location and condition and subject to similar leases. Changes in fair value of a property are not reflected in the profit and loss as the property is carried at cost less accumulated depreciation and impairment if any in the financial statements. The fair value of the investment property is disclosed separately in the notes to the financial statements. Valuations are performed by independent registered valuers, who are required to be appropriately qualified to undertake the valuation, based on the type and locality of the property being valued. The valuation reports are prepared by valuers in compliance with all relevant industry standards and codes. Properties are valued at intervals of not more than three years, unless requested earlier or more frequently by a lender, and immediately prior to the scheduled end of the term of the Fund. Valuations are also conducted within two months after the Board forms a view that there is likelihood that there has been a material change in the value of a property. Copies of the valuation policy can be obtained free of charge by contacting MacarthurCook on (02) or writing to us at Level 16, 323 Castlereagh Street, Sydney, NSW The ICR is equivalent to the Bank DSC under the Senior Debt Facility. 27 Annualised distribution of 8.5% p.a. is based on the Application Price of $0.245 per New Unit. Entitlement Offer PDS 17

20 Auditor s report 18 AIMS Property Fund (St Kilda Road)

21 Entitlement Offer PDS 19

22 Section 5 Risks Before investing in the Fund under this Entitlement Offer you should consider whether the New Units are suitable given your personal investment objectives. An investment in the Fund should be considered illiquid. If you require further information regarding the appropriateness or potential risks of this investment, you should seek appropriate financial advice. All investments involve risk and there are many factors that can impact on the performance of an investment. This summary details some of the key risks that you should be aware of when investing in the Fund. Existing Unitholders and New Investors should be aware that the list of risks described below is not exhaustive. It is not possible for us to protect the value of your investment from all risks. However, we will maintain investment and property management processes that aim to minimise the investment risks of the Fund. Risks associated with the Entitlement Offer Change in unitholding it is possible that the Relevant Interest of MPS may increase if no Existing Unitholders or New Investors subscribe for New Units. The potential changes in the Relevant Interest of MPS are set out in section 2. Subject to voting restrictions in certain circumstances, MPS may have the ability to control or significantly influence matters which are decided at meetings of Unitholders. Dilution risk a risk of the Entitlement Offer is the potential for a dilution of your interest in the Fund if you do not take up your full Entitlement. See section 2 for the value dilution effects of the Entitlement Offer depending on your take up of your Entitlement. Specific risks associated with an investment in the Fund Banking obligation risk the Senior Debt Facility is subject to various loan covenants, including Bank LVR and Bank DSC, which the Fund must comply with. If the value of the Property falls, then this could result in a breach of loan covenants and the financier could force action to be taken to reduce debt levels, including forcing the Property to be sold. Forced action may lead to the reduction or suspension of distributions, and may impact the value of the Units. The same risks would apply if the Fund refinanced its facility with another bank and the facility contained similar covenants which the Fund may need to comply with. Refer to section 4 in relation to the Fund s sensitivity to decreases in Property value. Interest rate risk an increase in interest rates or margins would lead to increased interest expenses for the Fund, which could reduce returns from the Fund. In extreme circumstances, an increase in interest rates or margins could lead to a failure to meet interest obligations, or could mean refinancing is not possible. If this occurs, the Property may have to be sold at short notice, which may affect the price achieved. Refinancing risk there is a risk that the Fund may not be able to refinance its borrowings when the Senior Debt Facility matures. If this occurs, the Fund may lose value from selling the Property in poor market conditions in order to repay the borrowed amount. Liquidity risk an investment in the Fund is illiquid and Unitholders currently have no right to withdraw from the Fund, other than in accordance with a withdrawal offer from the Responsible Entity. There is a risk you may not be able to sell or redeem your investment promptly or at all, as the Responsible Entity is not compelled to offer withdrawal rights and there is no secondary market for Units. Distribution risk the level of income the Fund receives, and hence the level of distributions that may be paid to Unitholders, depends on a range of factors. Returns are affected by many factors including the strength of the underlying cashflow, the Fund s debt obligations, the Fund s operating expenses, the revaluation of the Property, as well as any capital expenditure requirements. There is no certainty that distributions will recommence in relation to the Fund s Ordinary Units following the completion of the Entitlement. Re-leasing and vacancy risk there is a risk that leases will not be renewed, and that a portion of the tenancies in the Property will be vacant until they are relet. There is also a risk that lease extensions or new leases may not be at equivalent rates to existing leases. This loss of income, combined with the costs associated with reletting tenancies may result in a reduction in distributions from the Fund and a fall in the value of the Property. The ability of the Responsible Entity to manage vacancy risk may also be influenced by any leasing incentives granted to prospective tenants and the supply in the market, which, in turn, may increase the time required to let vacant space. Property risk the Property may be damaged or destroyed by fire or other disaster. Whilst the Responsible Entity insures the Property against such risks, insurance coverage may prove to be insufficient or not available in some circumstances. 20 AIMS Property Fund (St Kilda Road)

23 Litigation risk The Fund and the Responsible Entity may be involved in disputes and litigation with tenants of the Property, members of the public who come onto the Property, other persons who have dealings with the Property, Unitholders, regulators and other third parties. To the extent that such parties have the ability to recover from the Assets of the Fund (including where the Responsible entity is entitled to be indemnified out of the Assets of the Fund) or assert rights against the Fund such matters could affect the value of the Assets or the expected income of the Fund. Environmental risk there is a risk that under various environmental laws, the Fund may be liable for the cost of removal or remediation of hazardous or toxic substances on, under or emanating from the Property. There is a risk that environmental laws become more stringent. Environmental conditions on or near the Property may have a materially adverse effect on their value. Counterparty risk there is a risk that third parties, such as contractors, service providers, insurers and other counterparties may not be willing or able to perform their obligations, or will no longer be willing to enter new contracts or extend existing contracts which will negatively impact the income or Assets of the Fund. Property value risk the value of the Fund s Property is affected by a number of risks (some of which are explained further below), which without limitation, include: changes in rental rates; fluctuating tenancy levels; a downturn in the value of the Property or in the property market in general; pricing or competition policies of any competing properties or tenants; risk of tenants defaulting; increased competition from new and existing properties; and increases in supply or falls in demand for property in the local market. Changes in the property market, especially changes in valuation of properties and in market rents, may adversely affect the Fund. Tenancy risk tenants of the Property may be unable or unwilling to honour their lease obligations. This may result in a reduction of the income level of the Fund, and could result in legal costs associated with the recovery of outstanding amounts, and other costs associated with the reletting of the tenancy. Capital expenditure risk there is a risk that the level of capital expenditure required in respect of the Fund s Property could exceed expectations. This could result in an increase in the Fund expenditure and have an adverse impact on the Fund s distributions. Change in law risk changes in income tax, indirect tax, stamp duty or other relevant legislation or policy may affect the Fund s returns or the distribution made to Unitholders. As changes in revenue law or policy and other legal, regulatory or accounting standards often cannot be foreseen, MacarthurCook will attempt to practically respond to any such changes in the interest of Unitholders. Other risks the above list of risks is not exhaustive and only outlines the significant specific risks which the Fund faces. The risks outlined above and other risks may materially affect an investment in the Fund. Accordingly MacarthurCook gives no assurances or guarantees in respect of future performance, profitability, payment of distributions or return of capital. How do we manage risk? While it is impossible to eliminate risk, it is important to understand where the risks are and to manage them to ensure the returns are commensurate with the risks taken. MacarthurCook seeks to manage the investment risks of the Fund in a number of ways including: managing and monitoring the status of our Senior Debt Facility covenants; closely monitoring the performance of tenants and other parties to which the Fund has a significant financial exposure in order to detect signs of financial distress; taking all the usual measures in relation to property ownership risks such as adequately insuring the Property; ensuring that all borrowings are non-recourse to Unitholders; and ensuring that all personnel are adequately qualified and experienced in dealing with any matter in relation to the Assets of the Fund. The Constitution of the Fund provides that your liability is limited to the amount of your investment in the Fund. However, the question of limited liability for investors in investment vehicles like the Fund has not been tested in the courts. Entitlement Offer PDS 21

24 Section 6 Fees and other costs Consumer advisory warning Did you know? Small differences in both investment performance and fees and costs can have a substantial impact on your long term returns. For example, total annual fees and costs of 2% of your fund balance rather than 1% could reduce your final return by up to 20% over a 30 year period (for example, reduce it from $100,000 to $80,000). You should consider whether features such as superior investment performance or the provision of better member services justify higher fees and costs. You may be able to negotiate to pay lower contribution fees and management costs where applicable. Ask the fund or your financial adviser. To find out more If you would like to find out more, or see the impact of the fees based on your own circumstances, the Australian Securities and Investments Commission (ASIC) website ( has a managed investment fee calculator to help check out different options. Fees and other costs This section shows the fees and other costs that you may be charged in relation to your investment in the Fund. These fees and costs may be deducted from the money you invest, from the returns from your investment or from the Fund s Assets as a whole. The fees and costs are provided are inclusive of GST less a full input tax credit or reduced input tax credit (RITC), as applicable. Taxation information is set out in section 7. You should read all information about fees and costs as it is important to understand their impact on your investment. Fees when your money moves Type of fee or cost Amount How and when paid Establishment fee Nil Not applicable The fee to open your investment Contribution fee The fee on each amount contributed to your investment Nil Not applicable Withdrawal fee The fee on each amount you take out of your investment Termination fee The fee to close your investment Nil Nil Not applicable Not applicable Management costs 28 Type of fee or cost Amount How and when paid The fees and costs for managing your investment Estimated at 0.8% per annum of the GAV 29. This comprises: base management fee of 0.6% per annum of GAV; and fund expenses, estimated to be 0.20% per annum of GAV The base management fee is payable monthly in advance and is deducted directly from the Fund s assets. Expenses are deducted directly from the Fund s assets as they are incurred. Example of annual fees and costs The table below gives an example of how the fees and costs for this Fund can affect your investment over a one year period. You should use this table to compare this product with other managed investment products. Example Fee Balance of $50,000 with contribution of $5,000 during the year 30 Contribution fee The fee to open your investment Nil You will not be charged a contribution fee Plus management costs base management fee administration expenses 0.60% per annum of the GAV; For every $50,000 you have invested in the Fund, you will be charged $300 per annum Equals cost of the Fund If you had an investment of $50,000 at the beginning of the year and you invested an additional $5,000 during that year, you would be charged between $300 and $330 for that year. 28 The components of the management costs are discussed in more details in the Additional explanation of fees and costs section on page 23. Additional fees may apply in any given year including performance fees, acquisition fees and disposal fees. Refer page This equates to an indirect cost ratio of 2.9% per annum of the NAV at the time of this PDS. 30 Additional fees may apply in a given year including performance fees, acquisition fees and disposal fees. Please refer to page 23 for more information. 22 AIMS Property Fund (St Kilda Road)

25 Additional explanation of fees and costs Contribution fee Under the Constitution, the Responsible Entity can deduct a maximum contribution fee of 5.0% from any Application Moneys paid by an Existing Unitholder or New Investor. There is no contribution fee payable in respect of an application made under this Entitlement Offer. Ongoing management costs Base management fee The management fee is for managing the Fund. Under the Constitution, the Responsible Entity is entitled to an ongoing management fee of 0.6% per annum of the GAV. Fund expenses The Responsible Entity is entitled to be reimbursed for all reasonable outgoings and disbursements in connection with the proper performance of its duties and obligations in operating the Fund. Fund expenses recovered may, for example, include those relating to postage, printing, accounting services, auditing services, legal services, valuations, maintaining the Unitholder register and custody services. As it is not possible to determine the quantum of fund expenses which may be incurred, the Responsible Entity has estimated that expenses incurred by it will be 0.2% per annum of the GAV. Performance fee Under the Constitution, the Responsible Entity will be entitled to a performance fee which is calculated as follows: if upon sale of the Property, the net sale price (after deduction of agents commission, legal fees, advertising and auction expenses) (Net Sale Price) is more than $25,125,000 but less than $30,000,000, the Responsible Entity of the Fund is entitled to receive a fee that is equal to an amount that will be calculated as follows: - 10% x (Net Sale Price - $25,125,000); or if upon the sale of the Property, the Net Sale Price is equal to or more than $30,000,000, the Responsible Entity of the Fund is entitled to receive a fee that is equal to an amount that will be calculated as follows: - 20% x (Net Sale Price - $25,125,000). The table below shows the potential performance fee based on the sale of the Property at various prices. Sale Price ($ 000) Debt ($ 000) NTA Performance fee ($ 000) Performance fee per Unit 24,000 11,907 $ ,000 11,907 $ ,000 11,907 $ $ ,000 11,907 $ $ ,000 11,907 $ $ ,000 11,907 $ $ ,000 11,907 $ $ ,000 11,907 $0.41 1,200 $ ,000 11,907 $0.44 1,400 $0.076 Additional information on other fees and costs Disposal fee The Responsible Entity is entitled to a disposal fee of 2.0% of the gross sale price of the Property. The Responsible Entity will pay any selling fees payable to real estate agents engaged by the Responsible Entity in connection with the sale out of the Responsible Entity s disposal fee. For example, if the Property is sold for $30 million, then the Responsible Entity is entitled to a disposal fee of $0.6 million out of which any selling fees payable to real estate agents must be paid. Service fees The Responsible Entity may also seek services for the Fund from service providers, including related parties. The fees for these services will be charged on normal commercial rates to the Fund and are subject to the approval of the Responsible Entity s independent directors. Operational costs These costs are associated with maintaining the Property and are a cost of the Fund. They include land tax, rates, insurance and repairs costs (to the extent they are not recoverable from tenants). GST The Fund may be charged GST on the management and other fees and expenses. Where available, the Fund will claim a proportion of the GST charged as input tax credits or RITC (as the case may be). For additional details on the taxation implication associated with an investment, please refer to section 7. Adviser remuneration MacarthurCook will not pay any commission to financial advisers and other intermediaries in connection with the Entitlement Offer. Differential fees MacarthurCook may negotiate special fee arrangements with New Investors who are wholesale clients pursuant to the Corporations Act under which it reduces or rebates fees to those investors. Such special fee arrangements will not adversely impact upon the fees that are paid by other Unitholders. Entitlement Offer PDS 23

26 Section 7 Taxation Consumer advisory warning The taxation information provided in this PDS is of a general nature and should not be relied upon by Existing Unitholders and New Investors as specific taxation advice. Existing Unitholders and New Existing Unitholders and New Investors should obtain, and only rely upon, their own independent taxation advice having regard to their specific circumstances about the consequences of acquiring or disposing of the New Units and receiving distributions in respect of the New Units. This taxation summary is based on the income tax, GST and stamp duty law as at the date of issue of this PDS. Taxation of the Fund The potential tax risks of the Entitlement Offer for the Fund are set out in section 5 and this section of the PDS. This summary of tax matters set out below is based on current judicial and administrative interpretations of the Income Tax Assessment Act 1997 (Cth), Income Tax Assessment Act 1936 (Cth), Taxation Administration Act 1953 (Cth) (collectively referred to as the Tax Act) and the GST Law. However, Existing Unitholders and New Investors should be aware that the ultimate interpretation of the taxation law rests with the courts, and that the law, and the way that the Australian Taxation Office administers the law, may change over time, including with potential retrospective effect. Tax status of the Fund The Fund is an unlisted unit trust. Generally, for Australian income tax purposes, trusts are treated as tax flow through vehicles. This means that the Fund will not be subject to income tax on any net income that it distributes to its Australian resident Unitholders, provided that the Fund is not classified as a Corporate Unit Trust under Division 6B or a Public Trading Trust under Division 6C of the Income Tax Assessment Act We do not anticipate that the Fund would fall within either of these classifications. On the basis that the Fund invests in property for the purpose of deriving rental income, the Fund should be treated as a tax flow through vehicle. If the Fund does not distribute all its net income to Unitholders, the Fund may be liable to income tax on the undistributed net income. Australian taxation implications for Unitholders These comments are a brief guide to the Australian income tax, stamp duty and GST consequences of subscribing for New Units and investing in the Fund. These comments are necessarily general in nature and do not attempt to address all of the Australian tax consequences relevant to Unitholders. These comments only consider a Unitholder who is an Australian resident for income tax purposes and who will hold the Units on capital account. The tax information below does not apply to a Unitholder who holds their Units as trading stock or as revenue assets or is subject to the rules regarding the Taxation of Financial Arrangements. Further, the information in this section may not apply to taxpayers subject to special tax rules for banks, insurance companies and tax exempt entities. Non-residents are encouraged to seek professional taxation advice specific to their own country of taxation residence, as well as Australian tax consequences. The income tax treatment and consequences of applying for New Units will vary depending on the particular circumstances of each Unitholder. Granting of rights Existing Unitholders Entitlements offered under this PDS are non-renounceable and therefore unable to be traded. The receipt of the Entitlement offered under the Entitlement Offer should not give rise to any assessable income for relevant Existing Unitholders. Acquisition of New Units under the Entitlement Offer If you take up your Entitlement under the Entitlement Offer, you will acquire an additional 15 New Units for every 10 Units you hold as at the Record Date. Unitholders will not be subject to tax on the acquisition of New Units under the Entitlement Offer. The amount paid to acquire New Units will not be deductible, but Unitholders will be deemed to have a cost base in the New Units equal to the Application Price of 24.5 cents per New Unit plus any incidental costs to acquire the new units. 24 AIMS Property Fund (St Kilda Road)

27 Expiration or lapse of Entitlement If an Existing Unitholder allows their Entitlement under the Entitlement Offer to lapse, the Existing Unitholder will not receive any consideration as a result of the expiration or lapse of their Entitlement. On this basis, there should be no tax implications for Existing Unitholders who allow their Entitlement to lapse. Holding and disposing of New Units For capital gains tax purposes, the New Units will be deemed to be acquired when the Entitlement under the Entitlement Offer is exercised. Future taxation of distributions You will be liable to pay tax at your marginal tax rate on your proportionate share of the net income of the Fund in the year in which the Fund derives the income, whether or not the distribution has been received. For example, June quarter distributions must be included as taxable income for the financial year ending that June, even though you generally receive your distribution after June. At times you may receive cash distributions from the Fund that exceed your share of the net income of the Fund. These excess distributions are referred to as tax deferred distributions and may arise due to different accounting and taxation treatments of certain income and expense items of the Fund. If you receive a tax-deferred amount, you are required to reduce the capital gains tax cost base of your Units by that amount. Where the tax-deferred distribution exceeds the capital gains tax cost base of your Units, a capital gain will arise. You may be entitled to claim the capital gains tax discount on such a capital gain. For details, please see the Capital Gains Tax section below. Where a return of capital is made by the Fund, the taxation implications will be similar to the taxation treatment of tax-deferred amounts as outlined above. You should wait until you receive your tax statement for the Fund each year before completing your tax return. The tax statement will provide you with full details of the income paid to you during the year. The tax statement will be sent within four months of the end of the financial year. Quotation of TFN or ABN Under the Pay As You Go system, the Fund may be required to withhold tax from distributions if you do not quote a TFN or claim an exemption from quotation. Where you invest in Units as part of carrying on a business, you may quote your Australian Business Number instead. Capital Gains Tax When the Fund makes a capital gain on the sale of an investment it has held for at least 12 months, a 50% capital gains tax discount should apply when calculating the Fund s taxable capital gain. Where the capital gain is distributed to Unitholders, you will have to gross up the distribution and apply any current or prior year capital losses against the grossed up capital gain to arrive at your net capital gain position. Depending on your personal circumstances, you may be able to apply the discount percentage (namely 50% for individuals or trusts and 331/3% for complying superannuation entities) to your capital gain. Similarly, if you sell or redeem your Units for an amount that is more than their cost base at that time, you may be able to apply the relevant discount percentage to your net capital gain provided you have held the Units for at least 12 months. Unitholders that are companies are not entitled to the capital gains tax discount. GST The issue of New Units is a financial supply for GST purposes and, accordingly, no GST is payable on the acquisition of New Units. Further, there should be no requirement for GST to be imposed on: the distributions paid to Unitholders; or the receipt of interest and dividends; or proceeds from disposals of investments by the Fund. Entitlement Offer PDS 25

28 Section 8 Valuation Report 26 AIMS Property Fund (St Kilda Road)

29 Entitlement Offer PDS 27

30 28 AIMS Property Fund (St Kilda Road)

31 Entitlement Offer PDS 29

32 30 AIMS Property Fund (St Kilda Road)

33 Entitlement Offer PDS 31

34 Section 9 Responsible Entity Responsible Entity MacarthurCook is the responsible entity of the Fund. The Responsible Entity s powers, rights and liabilities in relation to the Fund are governed by the Corporations Act, the Constitution and common law. The Responsible Entity is required to act in the best interests of Unitholders as a whole. Corporate structure of MacarthurCook MacarthurCook is a wholly owned entity of AIMS. AIMS was established in 1991 and has developed in to a diversified financial and property services business with operations in funds management, property management, securitisation, lending and investment banking. In August 2009, AIMS acquired MacarthurCook Limited, an ASX listed property fund management business. Since the take over, AIMS has managed $1.5 billion of direct and indirect real estate assets mainly in the core sectors of office and industrial. AIMS operations are located in Sydney, Melbourne, Singapore, Beijing and Shanghai. AIMS are an active manager that has the expertise to provide a full spectrum of property services including property management, leasing, asset management, development and funds management. Directors of MacarthurCook Mr George Wang Executive Chairman appointed 7 August 2009 George is the founding CEO of AIMS Financial Group and an active participant in both the Australian and Chinese financial services industries. George came to Australia from China some 20 years ago and founded AIMS 2 years later. Since inception, AIMS has evolved into a diversified financial services group, active in the areas of lending, securitisation, investment banking and funds management. In the course of developing AIMS into a significant financial services group, George has developed an extensive business network in both Australia and China. George is an advisor for a number of Chinese Government bodies and agencies. George holds the position of Chairman of Australia-China Financial and Investment Council. In Australia, George is the President of the Australia-China Finance and Investment Council. George is also the Executive Chairman of AIMS Financial Group and MacarthurCook Fund Management Limited, the Deputy Chairman of Asia Pacific Stock Exchange and a Non-Executive Director of the responsible entity of the AIMS AMP Capital Industrial REIT. Mr Richard Nott AM Non-Executive Independent Director Chairman of the Audit Committee and Risk Management Committee appointed 5 August 2010 Richard is a former General Manager and Chief Executive of CGU Lenders Mortgage Insurance Ltd, General Manager Corporate Banking at Standard Chartered Bank Australia Ltd, General Manager Banking and Associate Director at Australian Bank, and also had a 26 year career with National Australia Bank in Australia and England. Richard is also a Director of Prime Insurance Group, a Bermudan based lender s mortgage insurer. Richard has been a Director of First American Title Insurance Company of Australia Ltd since 2002 and a Director of Four Hats Financial Services Pty Ltd. In July 2011, Richard was appointed Managing Director for Mortgage Guarantee Insurance Corporation Australia and in 2012 he was appointed as Non-Executive Director of RHG Limited. In June 2012, Richard was awarded a Member of the Order of Australia (AM) for services to banking, insurance and the community through the Australia-Britain Society in the Queen s Birthday Honours List. Richard s qualifications include a Bachelor of Science (Hons), Master of Business Administration, Master of Commerce and Master of Insurance and Risk Management. He is a Fellow of the Australian and New Zealand Institute of Insurance and Finance, Chartered Insurance Institute (UK) and Chartered Institute of Bankers (UK), plus the Accounting, Chartered Secretaries, HR and Management Institutes. He is also a Senior Fellow and life member of FINSIA. Mr John Love Non-Executive Independent Director John is the Chairman of Mortgage Guarantee Insurance Corporation Australia, and a Non-Executive Director, the Chairman and a Member of the Audit, Governance & Risk Management Committee for The Australian Wine Society Co-operative Limited. John was previously the General Manager of an Australian mezzanine property finance company and Head of Corporate Banking Australia and Head of Credit at Standard Chartered Bank (Australia) Limited. John s qualifications include a Bachelor of Commerce, a Master of Business Administration (AGSM) and a Master of Insurance and Risk Management (Deakin). He is a Fellow of the Australian and New Zealand Institute of Insurance and Finance, a Certified Practicing Accountant, a Fellow of the Tax Institute of Australia, a Fellow of the Chartered Institute of Secretaries, a Fellow of FINSIA, a Fellow of the Australian Institute of Company Directors and a Fellow of the Australian Mutual Institute. 32 AIMS Property Fund (St Kilda Road)

35 Key personnel Michael Goldman Head of Property Funds Michael has 17 years experience in the real estate industry across acquisitions, development, investment banking and funds management. Prior to joining MacarthurCook in January 2011, Michael was a Director of National Australia Bank s Property Equity & Advisory division where he led numerous equity capital raising, mergers and acquisition and advisory transactions for institutional property clients. Michael also worked for the Recreational Tourism Group as General Manager for Acquisitions and Developments, and also at Charter Hall Group in the Property Investment Banking division where he was responsible for the establishment and structuring of a series of Charter Hall Investment Funds. Michael has also had previous funds management experience at Bridges Financial Services, one of Australia s largest financial planning and stockbroking business with over $7.7 billion in client s funds under advice. After graduating with a Bachelor of Economics, Michael commenced his career at Ord Minnett as an analyst where his coverage included property securities. Michael also holds a Graduate Diploma in Applied Finance and Investment Analysis from FINSIA. Trent Watkins Senior Portfolio Manager Trent has 15 years experience in the property industry and is currently Senior Portfolio Manager MacarthurCook, responsible for the management of a diverse range of properties located throughout Australia. Trent s role as an active asset manager of a large portfolio of real estate assets involves all leasing activities, capital expenditure programs, budgeting and the re-positioning of assets through the management of enhancement and refurbishment projects. Trent has gained a wide array of experience through his work at Chesterton International, Fortius Funds Management and State Property Authority. Trent holds a Bachelor of Commerce (Land Economy) and an Associate Diploma in Investment & Finance. He is a licensed real estate agent, an associate of the API and a fellow of the Financial Institute of Australia. Alan Wong Head of Legal and Compliance and Company Secretary Alan has over 7 years experience as a legal practitioner in Australia. Alan is General Counsel for AIMS Financial Group and is responsible for all legal, compliance and risk management matters throughout the whole group of companies. Alan is also the Co-Company Secretary for MacarthurCook and AIMS Investment Management Limited. Prior to his current role, Alan worked at Gadens Lawyers in Sydney where he was responsible for restructuring real estate funds, establishing lending programs, providing compliance and risk management services as well as banking litigation and recoveries. Alan holds a Bachelor of Commerce and a Bachelor of Law from the University of Sydney. Corporate governance The Board is in charge of the overall corporate governance of MacarthurCook, including putting in place the appropriate policies and procedures so that MacarthurCook fulfils its functions effectively and responsibly. The Board recognises the role and importance of corporate governance and ensuring appropriate accountability of the Board and management. The Board more broadly has created a framework for managing entities within AIMS, including putting in place relevant internal controls and a risk management process. Conflicts of interest Various potential conflicts of interest between MacarthurCook and AIMS and its related entities and the investors in the various funds that it manages (including Unitholders in the Fund) exist or may arise in the future. MacarthurCook personnel will also generally be involved in the management and operation of the Fund and other funds operated by MacarthurCook and its related entities. This may give rise to potential conflicts of interest. MacarthurCook has adopted a Conflicts of Interest and Related Party Transactions Policy (which sets out how conflicts are to be managed and dealt with) and, where necessary, obtains external advice on such conflicts. For more details, please refer to sections 11.7 and Risk management MacarthurCook has established procedures for: the oversight of risk management activities through roles of the Board and the Audit, Risk and Compliance Committee; and a Risk Management Framework and Policy for the identification, management and monitoring of material business risks. The Risk Management Framework and Policy form a part of the Responsible Entity s Policy Manual. Entitlement Offer PDS 33

36 Section 10 Material agreements 10.1 Senior Debt Facility The Responsible Entity of the Fund has entered in to a Senior Debt Facility with the Lender. The key terms are: Facilities and commitments The total commitment under the Senior Debt Facility is $18,875,000 comprising of: i. Cash Advance Facility A of $14,700,000; ii. Cash Advance Facility B of $3,675,000; and iii. Capital Improvements Facility of $500,000. Term The term of the Senior Debt Facility ends on 23 May Interest rate The interest rates for each tranche of borrowings under the Senior Debt Facility are as follows: iv. Cash Advance Facility A: BBSY plus 4.0% per annum; v. Cash Advance Facility B: BBSY plus 5.75% per annum; and vi Capital Improvements Facility: BBSY plus 5.75% per annum. Hedging The interest rate is currently not fixed. However, at any time while the interest rate is not fixed, the Lender may require MacarthurCook to hedge its interest rate exposure. Financial covenants The Fund must ensure that: the maximum Bank LVR (being the total outstanding divided by the assessed value of the Property) does not exceed 75%; and the minimum Bank DSC (NOI for the relevant period divided by the Bank DSC for the relevant period) is 1.45 times. Undertakings The Senior Debt Facility contains undertakings and restrictions which MacarthurCook considers to be usual for a loan of this nature. Events of Default The Senior Debt Facility contains various events of defaults, including non-payment, failure by the Fund to comply with its financial covenants, breach of the Fund of other undertakings where that breach is not remedied. Security Security under the Senior Debt Facility consists of first ranking mortgage over the Property, plus a general security over the Fund Property Management Agreement MacarthurCook, in its capacity as responsible entity of the Fund, has appointed Cinon, a related entity to MacarthurCook, to provide the following services in respect of the Property under the Property Management Agreement on arm s length commercial terms: property management services; facility management services; financial and administrative management services; marketing and marketing co-ordination services; and project management services. Fees payable under the Property Management Agreement are set out in the table below. Services Property management services (this is currently outsourced to Knight Frank) Facility management services (these services are currently undertaken by Knight Frank) Financial and administrative management services (these services are currently undertaken by Knight Frank) Marketing and marketing co-ordination services (these services are currently undertaken by Knight Frank and Lemon Baxter) Project management services Proposed Fee 3% p.a of the gross rental income of the Property $50,000 p.a increases 4% annually $20,000 p.a increases 4% annually Up to 3 year lease: 12.5% of annual average gross rental, plus 0.5% for each preceding year beyond a 3 year term; Disposal Fee: 2% of gross sale price 3% of construction costs or a fee mutually agreed between the parties Knight Frank provides monthly reports in respect of the Property and in relation to all material Property matters. 34 AIMS Property Fund (St Kilda Road)

37 Section 11 Additional information 11.1 Fund Constitution The following is a summary of some of the principal rights of Unitholders under the Constitution of the Fund: Unitholders are entitled to receive notice of, and to attend and vote at, a general meeting of the Fund and to receive all notices, accounts and other documents required to be sent to Unitholders pursuant to the Constitution, the Corporations Act or the general law; Each Unitholder present in person or by an attorney, representative or proxy at a general meeting of the Fund has one vote on a show of hands (unless a Unitholder has appointed two proxies) and one vote per dollar value of the total interests they have in the Fund on a poll. Where there are two or more joint holders of a Unit and more than one of them is present at a meeting and tenders a vote in respect of the relevant Unit, only the vote cast by the holder whose name appears first in the Unit register will count; MacarthurCook may, on behalf of the Fund, issue further Units for the issue price specified in the Constitution; Unitholders have no right to withdraw their investment in the Fund other than in accordance with the terms of a withdrawal offer made by MacarthurCook. MacarthurCook is not obliged to make, and does not anticipate making any such withdrawal offer; Units may be transferred by a written document in required form. MacarthurCook may refuse to transfer Units without giving any reason; Unitholders will be entitled to participate in Fund distributions according to their rights and interest. Subject to the rights attaching to New Units (refer section 11.2 below), this means in proportion to their Unit holdings. If the Fund is wound up, Unitholders will be entitled to participate in any surplus assets of the Fund according to their rights and interests. Subject to the rights attaching to New Units (refer section 11.2 below), this means in proportion to their holdings; Subject to the Constitution and the Corporations Act, the Responsible Entity has all the powers in respect of the Fund which it would have if it was the owner of the assets of the Fund. The Constitution provides that the Responsible Entity will be paid out of the income or capital of the Fund and the fees which are detailed in section 6; MacarthurCook has a right of indemnity out of the Fund s Assets unless it has acted negligently, fraudulently or in breach of trust; and MacarthurCook may hold Units and may contract with itself in another capacity, for example as trustee of another fund, and may contract with related entities for the provisions of services to the Fund paid for by the Fund. Unitholders can obtain a copy of the Constitution free of charge by calling us on (02) Terms of New Units New Units have the following terms: (a) receive a distribution of income at the Preferred Rate (defined below) per annum (annualised where applicable) from the period commencing on the date of issue of the New Unit and ending on 31 December 2015, and any such distribution: (i) is cumulative; and (ii) will rank for payment in priority to distributions of income or capital to Ordinary Units. For the purposes of this paragraph, Preferred Rate means a rate of 8.5% per annum made in respect of the New Unit. After 31 December 2015, New Units will rank equally with Ordinary Units for all distributions of income; (b) all outstanding distributions on New Units must be paid in priority to distributions of income or capital to Ordinary Units. The Responsible Entity may pay outstanding distributions out of capital; (c) will participate in capital returns on a pro rata basis with Ordinary Units provided that Ordinary Units may not receive a capital return unless: (i) the Responsible Entity is not in arrears in payment of the preferred distribution referred to in paragraph (a) above; and (ii) the Responsible Entity considers (acting reasonably) that payment of the relevant capital return will not jeopardise the Responsible Entity s ability to make payment of the preferred distribution referred to in paragraph (a) or pay the Redemption Price (defined below); (d) the right to be redeemed in priority to all Ordinary Units such that each New Unit will be redeemed at the Redemption Price (defined below) on the earlier to occur of the following events: (i) the later of 31 December 2015 and the date which Unitholders determine as the extended term of the Fund pursuant to the Constitution; (ii) the date the Responsible Entity determines the purpose of the Fund has been, or cannot be, accomplished; (iii) the date immediately following completion of the sale of the Property; (iv) the date immediately prior to the date a court orders the winding up of the Fund; (v) the date a resolution is validly passed by the requisite majority either by the Responsible Entity or by Unitholders in accordance with the Constitution and all relevant law for the termination of the Fund; and (vi) the date on which an administrator, liquidator, receiver or similar entity is appointed to the Fund. The Redemption Price applicable to the redemption of a New Unit will be an amount equal to the prevailing NTA per Unit less Transaction Costs (defined below) as at the redemption date. For the purposes of this paragraph, Transaction Costs means, at any time, an amount (if any) which the Responsible Entity determines is the total expenses which may be incurred or are expected to be incurred by the Responsible Entity if all assets of the Fund held at that time were to be disposed of at that time. The Redemption Price per New Unit must be paid to the holder of a New Unit within 180 Business Days of the date of redemption of the relevant New Units; and (e) the right to receive notices, reports and accounts and to attend, be heard and vote at all meetings of Unitholders of the Fund on the same basis as the holders of Ordinary Units. Entitlement Offer PDS 35

38 11.3 Returns on your investment as a Unitholder From the date of issue of the Units, your return on investment will come in the form of periodic distributions and changes in the value of your Units. Distributions represent your share of the distributable income of the Fund. Any distributions paid will be paid to you quarterly by direct deposit or, if the Responsible Entity makes a distribution re-investment facility available and you elect to participate, reinvested in Units. Distributions may also include your share of any capital amounts distributed from the Fund. Unit Price growth generally represents your share of the net asset value appreciation (i.e. capital growth) of the Fund, although there are other factors which may lead to a change in the price of Units, as described below. If the Unit Price increases, you receive the benefit of this type of return through increases in your distributions over time, by selling your Units, or by accepting a withdrawal offer. Every year the actual returns vary. We aim to provide a stable level of income distribution and capital growth over the term of your investment. However, all investments involve fluctuations in market conditions and some degree of risk. For details of some of the risks associated with an investment in this Fund, please see section Distribution practices The distributable income of the Fund generally consists of interest and rent received by the Fund less the expenses of the Fund. As a Unitholder, your distribution income (if any) will be paid to you after deducting fees payable to the Responsible Entity pursuant to the Constitution. The Fund will only pay distributions from its cash from operations (excluding borrowings) available for distribution. If a distribution is paid for the December 2013 quarter it will comprise cash from the operations of the Fund. MacarthurCook anticipates that completion of this Entitlement Offer, and the subsequent lowering of the Bank LVR to approximately 50% (assuming the maximum amount of funds are raised under the Entitlement Offer), will allow distributions to recommence for the December 2013 quarter in relation to the Ordinary Units held by Unitholders in the Fund. Any distributions made will be paid by direct deposit. Payments may be made up to 90 days after the end of the relevant period. If you have not provided us with a TFN or exemption category, or if your application shows a country of residence other than Australia, we will deduct the relevant amount of tax from your distributions. Any distributions and distribution statements relating to investments made by an IDPS will be provided to the operator of that service Application Price The Application Price is the amount per New Unit you must pay to acquire a New Unit in the Fund. The Application Price under the Entitlement Offer is cents per New Unit Withdrawal arrangements The Constitution provides for the manner in which Unitholders may withdraw their investment from the Fund. Currently, Unitholders can only withdraw their investment in the Fund when MacarthurCook makes a withdrawal offer to all Unitholders. This is because the Fund does not have sufficient liquid Assets (as defined in the Corporations Act) that could be realised within 90 days (the period specified in the Constitution for satisfying withdrawal requests). Because property investments are by their nature generally illiquid, we do not anticipate that the Fund will be liquid (and therefore capable of satisfying requests for withdrawal) very often, if at all. If the Fund is liquid, meaning that at least 80% of the Fund s Assets could be realised for its market value within 90 days to fulfil the value of the withdrawal request, a Unitholder may make a request for withdrawal for some or all of their Units. If MacarthurCook gives effect to a Unitholder s withdrawal request, it would then be required to make payment within 90 days of receiving the withdrawal request. MacarthurCook need not give effect to certain withdrawal requests which are below the minimum application amount, unless the withdrawal request relates to the remaining balance of the Unitholder s investment in the Fund. If the Fund is illiquid, as it currently is, Unitholders can only withdraw an investment in the Fund when MacarthurCook makes a withdrawal offer to Unitholders. There is no withdrawal offer currently open to Unitholders. MacarthurCook is not obliged at any time to make a withdrawal offer and it may suspend withdrawals if certain conditions are satisfied. If MacarthurCook makes a withdrawal offer, MacarthurCook may determine the terms of the withdrawal offer in its absolute discretion. The withdrawal price will depend on whether withdrawals are funded by cash or the sale of Assets. If withdrawals are satisfied by cash, Units will be redeemed at a withdrawal price which is calculated by taking the NAV of the Assets of the Fund, less accrued income, plus estimated costs of selling the Assets and dividing that by the number of Units on issue. If withdrawals are satisfied by the proceeds of the sale of Assets, Units will be redeemed at a withdrawal price which is calculated by taking the net value of the Assets of the Fund, less accrued income and estimated selling costs of the Asset and dividing that by the number of Units on issue. By their nature, investments in real property are generally illiquid. Therefore, MacarthurCook does not expect the Fund to be liquid and, as such, an investment in the Fund should be considered long term and illiquid. 36 AIMS Property Fund (St Kilda Road)

39 11.7 Related party transactions The Constitution of the Fund provides that the Responsible Entity (and people or entities associated with it) may enter into a transaction with the Fund or with a person dealing with the Fund, or have an interest in any such transaction. Where such related parties transactions occur, the Responsible Entity will ensure that contracts are strictly on arm s length basis. MacarthurCook has a Conflicts of Interest and Related Party Transactions Policy which assists it in identifying and appropriately dealing with potential related party transactions. This policy sets out the procedures and processes to be followed in assessing, monitoring and approving any related party transactions which the Fund enters into. Any potential transactions with related parties will undergo an assessment process and must be approved or entered into unless they are on arm s length, commercial terms (or have been approved by Unitholders). The Board must consider and document its consideration in respect to whether the related party transaction is on arm s length terms. An external valuer or independent expert may be engaged to verify that the transaction is on arm s length terms. The policy also requires the making of appropriate disclosures to Unitholders in relation to related party transactions. Related party transactions are monitored by MacarthurCook s compliance officer and the Board. The compliance officer will update the policy in response to changes in internal structure, legislation and regulations and market developments where necessary. MacarthurCook currently complies with its policies and procedures in relation to entering into any related party transactions. MacarthurCook therefore meets this ASIC benchmark. For further information, please contact MacarthurCook on (02) Details of related party transactions There can be risks associated with related party transactions due to the perceived conflicts of interest which can arise. MacarthurCook has complied with its conflicts of interest and related party transaction policies in relation to the following related party transactions. A summary of the related party transactions relevant to a decision to invest in the Fund are set out below. These transactions that the Responsible Entity has entered into following the appointment of MacarthurCook were entered into on arm s length terms and therefore, Unitholder approval was not required: Cinon has been appointed as Property Manager. Refer section 10.2 for further details Reports To keep you informed about your investment, we will endeavour to provide the following reports and statements each year. In addition, we will confirm transactions in writing within the following timeframes. We will advise you if any of these timetables change. Report type Investment confirmations Distribution statements Transfer confirmations Taxation statements Timing Issued within 7 days of the issue of Units. Payments (if any) will usually be made up to 90 days after the end of each quarter. Distribution statements will generally be issued within 3 Business Days of payment. Issued within 4 Business days of registering the transfer of Units. Within 4 months of the end of the financial year. From time to time, we may also provide you with Fund performance updates and news if additional notification is appropriate. By providing your address in the application form, you expressly agree to receive financial services disclosures online from the Responsible Entity Availability of documents A copy of the Constitution and the compliance plan as well as the Financial Risk Management Policy and Conflicts of Interest and Related Party Transactions Policy may be inspected during business hours on Business Days or copies can be obtained by contacting MacarthurCook on (02) or writing to us at level 16, 323 Castlereagh Street, Sydney, NSW The annual and half year reports of the Fund are also available by contacting MacarthurCook or visiting our website at Ongoing disclosure and periodic reports The Fund is classified as a disclosing entity under the Corporations Act, and is subject to regular reporting and continuous disclosure obligations. These requirements include: audited annual financial reports; reviewed half year financial reports; and continuous disclosure of material non-public information about the Fund. MacarthurCook lodges annual and half yearly financial reports for the Fund with ASIC. MacarthurCook places these financial reports, updates of information contained within this PDS and other disclosure notices of material non-public information on our website www. macarthurcook.com.au in accordance with the good practice guidance set out in ASIC Regulatory Guide 198 (Unlisted disclosing entities: Continuous disclosure obligations). You may request hard or soft copies of this information free of charge by contacting us on (02) or writing to us at Level 16, 323 Castlereagh Street, Sydney, NSW In addition, the above documents and copies of all documents lodged with ASIC in relation to the Fund may be obtained from, or inspected at an ASIC office. Entitlement Offer PDS 37

40 11.12 Updated disclosure of benchmark information Section 1 sets out where the information required by RG46 can be found in this PDS. MacarthurCook will update Unitholders for ongoing disclosure against the six benchmarks and eight disclosure principles in RG46 by publishing updated or consolidated disclosure on its website MacarthurCook will generally update this information at least twice per year and also when there are material changes to this information Changing your details We require changes to your contact, payment or banking details to be made in writing and signed by you. If you have invested in joint names, we require all signatures Providing instructions via or fax We offer a fax and service that allows you to send us certain instructions regarding your investment in the Fund. Any instructions which are submitted to us by or fax must have your signature or that of an authorised signatory on your account. By using our service, you are taken to have agreed and understood that neither MacarthurCook nor AIMS accept any responsibility or liability for any payment or action we make based on any instruction (even if not genuine) that we receive by fax or bearing your account number, a signature which is apparently yours, or that of an authorised signatory on your account. You use the service entirely at your own risk. MacarthurCook retains discretion whether to accept or reject any instructions provided by fax or , and generally will not accept fax or instructions in respect of banking details Privacy policy We recognise your privacy is important to you. This policy provides you with information on the collection, storage, use and disclosure of your personal information. We will not collect any personal information about you unless you have knowingly provided information to us or authorised a third party to provide information to us. We will only collect, maintain and use personal information about you if it is necessary for us to provide the services you have requested. For example, as required by the AML/CTF Act. You may elect not to give us any of the personal information requested. However, without this information we may not be able to process your investment. By signing the application form attached to this PDS you authorise us to collect, maintain, use and disclose your personal information as set out in this privacy statement. You may request access to personal information held by us about you and ask us to correct it if you believe it is incorrect or out of date. We will not use or disclose personal information collected by us other than: for the purposes it was provided for or a related purpose where you would reasonably expect us to use or disclose the information; where you have consented to such disclosure; or where required or authorised under law, in circumstances relating to public health and safety, and in connection with certain operations by or on behalf of an enforcement body. For example, in accordance with the AML/CTF Act. Under the Corporations Act, we are obliged to maintain certain transaction records and make those records available for inspection by ASIC. We may also contract external parties to conduct due diligence, compliance or financial audits, which could involve the disclosure of your personal information. If you choose to invest in the Fund, your information may be disclosed to: the Australian Tax Office to advise of your TFN. If you choose not to provide us with your TFN, tax may be deducted from interest or distributions payable to you at the highest marginal tax rate plus levies; AUSTRAC to advise of the details of transactions in accordance with the AML/CTF Act; individuals who have the right to inspect the register of Fund members in accordance with the provisions of the Corporations Act; your financial advisor, either directly or indirectly through other service providers, such as platform software, which we may have arrangements with; reputable service providers who may carry out functions associated with our products and services on our behalf; communicate with you about your investment; deposit interest or distributions into your nominated bank account; or mortgage providers and your bank in accordance with your express authority. We may also provide you with direct marketing material such as articles and other investment opportunities that may be of interest to you. You consent for the purposes of the Spam Act 2003 (Cth) to receive such commercial s from MacarthurCook and its related bodies corporate. Should you not wish to receive such information please contact us via the details below: Post: MacarthurCook, Level 16, 323 Castlereagh Street, Sydney NSW 2000 Telephone: (02) Fax: (02) mail@macarthurcook.com.au Please allow two weeks for your request to be processed. 38 AIMS Property Fund (St Kilda Road)

41 Your personal information may be provided to entities related to MacarthurCook. It is a condition of our agreement with each of our representatives and staff that they adopt and adhere to this privacy policy. If you have any concerns in regard to this, you should contact MacarthurCook on (02) or write to us at Level 16, 323 Castlereagh Street, Sydney NSW If you have any complaints or questions about our privacy of your personal information, please contact our General Counsel by writing to: General Counsel MacarthurCook Fund Management Limited Level Castlereagh Street Sydney NSW 2000 If we do not resolve your compliant to your satisfaction, you may wish to write to the Privacy Commission at: Office of the Federal Privacy Commissioner GPO Box 5218 Sydney NSW Labour standards or environmental, social or ethical considerations While MacarthurCook intends to conduct itself in an ethical and sound manner, our investment criteria do not give additional weight to labour standards or environmental, social or ethical considerations when making or realising an investment of the Fund Complaints If you have a complaint, then please contact us directly. MacarthurCook has a complaints handling and dispute resolution procedure which it follows to acknowledge, investigate, respond to and resolve complaints by Unitholders. We will endeavour to acknowledge both written and verbal complaints immediately and in any event within 5 Business Days following receipt. We will investigate and attempt to resolve your complaint within 45 days after we receive the complaint. If you are not satisfied with our response, you can refer your complaint to the Financial Ombudsman Service (FOS), an external complaints handling body that provides an independent assessment of your complaint. FOS contact details are GPO Box 3, Melbourne, VIC, 3001 Telephone: mailto:info@fos.org.au Website: The Custodian Perpetual Corporate Trust Limited is the custodian of the Fund. Perpetual is one of the leading providers of corporate trustee services to the financial services industry. The Custodian s role is limited to holding the Assets of the Fund. The Custodian can only deal with the Assets as instructed by the Responsible Entity in accordance with the provisions of the Custodian Agreement between the Responsible Entity and the Custodian. The Custodian is an authorised representative of Perpetual Trustee Company Limited under Perpetual Trustee Company Limited s Australian Financial Services License Number (Authorised Representative Number ). The Custodian has no supervisory role in relation to the operation of the Fund and is not responsible for protecting your interests. The Custodian has no liability or responsibility to you for any act done or omission made in accordance with the terms of its agreement with the Responsible Entity. The Custodian is not the issuer of this PDS and has not prepared this PDS. The Custodian makes no representation in and takes no responsibility for the accuracy or truth of any statement in or omission from any part of this PDS. The Custodian and its directors or associates do not guarantee the performance or success of the Fund, the repayment of capital, or any particular rate of return of either capital or income The Registry MacarthurCook has appointed Boardroom (Victoria) Pty Limited ABN to administer the Unit register of the Fund Cooling off Unitholders and New Investors should note that no cooling off period applies to application of New Units under this Entitlement Offer because the Fund is not liquid as defined in the Corporations Act Consents KPMG has given and not withdrawn prior to the date of this PDS their written consent to the inclusion in section 4 of this PDS the reference to their review of the information set out in this section in the form and context in which it is included. KPMG takes no responsibility for any part of this PDS other than any reference to its name. Perpetual has given and has not, before the date of this PDS withdrawn its consent to be named in this PDS in the form and context in which it was named, has not made any statement that is included in this PDS or any statement on which a statement made in the PDS is based and to the maximum extent permitted by law, expressly disclaims and takes no responsibility for any statements in or omissions from this PDS, other than reference to its name in the form and context in which it is named. Knight Frank Valuations has given, and not withdrawn prior to the date of this PDS, their written consent to the inclusion in section 8 of this PDS of the references to their valuation in the form and context in which it is included. Knight Frank Valuations takes no responsibility for any part of this PDS other than any reference to their name and such references. Entitlement Offer PDS 39

42 Section 12 Glossary Report type ABN Timing Australian Business Number Additional New Unit New Units which are not taken up by Existing Unitholders as part of their Entitlement which may be issued to other Existing Unitholders and to New Investors. AEDT Australian Eastern Daylight Time AFSL Australian Financial Services License AIMS AIMS Group Holding Pty Limited ABN and its subsidiaries which make up the AIMS Financial Group. AML/CTF Act The Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth) Allotment Date 13 December 2013 Application Moneys Moneys received by MacarthurCook from Existing Unitholders or New Investors to subscribe for New Units pursuant to the Entitlement Offer. Application Price cents per New Unit ARSN Australian Registered Scheme Number Assets The assets of the Fund, including the Property. ASIC Australian Securities and Investments Commission ASX ASX Limited ABN , or the market operated by it, as the context requires. AUSTRAC Australian Transaction Reports Analysis Centre Bank DSC The debt service cost figure as calculated under the Senior Debt Facility. Bank LVR The loan to value ratio as calculated under the Senior Debt Facility. BBSY The bank bill swap rate. Board The board of the Responsible Entity Business Days A day other than a public holiday in New South Wales, a Saturday or a Sunday. Capitalisation Rate The ratio between net operating income produced by an asset and its capital value. Cinon Cinon Property Group Pty Limited ABN Constitution The trust deed of the Fund dated 15 April 2004 as amended from time to time. Corporations Act The Corporations Act 2001 (Cth) Custodian Perpetual Corporate Trust Limited Directors The directors of the Responsible Entity. EBITDA Earnings before interest, tax, depreciation and amortisation. Entitlement An entitlement of Unitholders to acquire 15 New Units for every 10 Units held by the Unitholder on the Record date pursuant to the Entitlement Offer. Entitlement Offer The offer of New Units (and Additional New Units) under this PDS. Existing Unitholder Any registered holder of Ordinary Units at the Record Date. Fund AIMS Property Fund (St. Kilda Road) (ARSN ) (formerly known as the Austgrowth Property Syndicate No.23) GAV Gross asset value GST Goods and services tax under the GST Law GST Law GST law as defined in section of the A New Tax System (Goods and Services Tax) Act 1999 (Cth) ICR Interest cover ratio IDPS Investor directed portfolio service 40 AIMS Property Fund (St Kilda Road)

43 Report type Timing Knight Frank Knight Frank Australia Pty Ltd ABN Knight Frank Valuations Valuation Services (Vic) Pty Ltd ABN KPMG KPMG ABN Lemon Baxter Lemon Baxter Pty Ltd ABN Lender GE Real Estate Investments Australia Pty Ltd ABN , the lender to the Fund. LVR Loan to value ratio MacarthurCook MacarthurCook Fund Management Limited ABN AFSL in its capacity as responsible entity of the Fund. MPS MacarthurCook Property Securities Fund ARSN NAV Net asset value New Investors Persons who are not Existing Unitholders on the Record Date and who subscribe for New Units pursuant to the Entitlement Offer. New Units Units issued on the basis of, and under of the terms of, the Entitlement Offer. NLA Net lettable area NOI Net operating income NTA Net tangible assets as described in section 4. Ordinary Unit means an ordinary Unit. p.a. Per annum. PDS This product disclosure statement dated 1 November 2013 Perpetual Perpetual Corporate Trust Limited ABN Property The direct property held by the Fund located at 492 St. Kilda Road, Melbourne. Property Management Agreement The property management agreement between MacarthurCook and Cinon dated 5 August 2013 Raising Amount Up to $6,787,725 being raised under the Entitlement Offer. Record Date 28 October 2013, being the date for determining Entitlements. Relevant Interest The holding by MPS of Units in the Fund. Responsible Entity MacarthurCook, the issuer of this PDS RG46 ASIC Regulatory Guide 46 unlisted property schemes RITC Reduced Input Tax Credit as able to be claimed under the GST Law Senior Debt Means the loan provided to the Fund by the Lender pursuant to the Senior Debt Facility. Senior Debt Facility Means the facility agreement between the Lender and MacarthurCook dated 23 May Subordinated Loan The loan of $389,719 provided to the Fund pursuant to the subordinated loan agreement dated 25 October 2012 together with deed of variation dated 9 May TFN Tax File Number Unit A unit in the Fund Unitholder A holder of Units Unit Price The price at which Units are issued to Unitholders, calculated in accordance with the Constitution. WALE Weighted average lease expiry Entitlement Offer PDS 41

44 42 AIMS Property Fund (St Kilda Road)

45 Application Process Section 13 Instructions for applicants Section 14 Application form Entitlement Offer PDS 43

46 Section 13 Instructions for applicants How to participate in the Entitlement Offer To participate in the Entitlement Offer you will need to: 1. Read this PDS in full 2. Talk to your adviser about the benefits of the Entitlement Offer and any risks you should consider 3. Visit our website at for any further information, or call us on Complete the personalised application form we have provided (for existing Unitholders) or the application form at the back of this PDS (for New Investors). For details on which form to use, please see instructions below 5. Mail your application form and a cheque to: Unitholders: Using the reply paid envelope included with your copy of the PDS and personalised application form. New Investors: Boardroom (Victoria) Pty Limited Level 7, 207 Kent Street Sydney NSW 2000 Application form Please refer to the table below to determine which sections of the application form you are required to complete: Applicant type Applicant type If you are an existing Unitholder If you are a New Investor Steps Use your personalised application form accompanying this PDS and follow the instructions provided. Use the application form attached to this PDS and follow the instructions below. New Investors must apply for a minimum of $10,000 of New Units Completing the application form: The following instructions will be relevant for applications from New Investors: A Application Amount The payment to be made on application is determined by the number of New Units you wish to apply. Please provide details of all cheques accompanying your application form. Cheque(s) must be crossed Not Negotiable and made payable to: AIMS Property Fund (St Kilda Rd) Payment must be made in Australian currency. Cheques not properly drawn may be rejected. Cheques will generally be deposited on the day of receipt. Please clip or pin your cheque to the application form do not use staples. We do not accept cash deposits. B Type of investor Please mark one of the boxes with a cross to indicate who is making the investment. 44 AIMS Property Fund (St Kilda Road)

47 C Investor details Please provide you details in correct form. Type of investor Instruction Correct form Examples of incorrect form Individuals Give full name, not initials WILLIAM JOHN SMITH W J Smith Joint Give full name, not initials WILLIAM JOHN SMITH AND W J Smith and J E Smith JANE ELIZABETH SMITH Companies Use company title, not abbreviations PAUL JOHNSON PTY LTD P Johnson Co Paul Johnson P/L Trusts Estate-Executor Partnerships Superannuation Funds D EF G Lodging the application form: The application form should be sent to: Use name(s) of the trustee(s), not the name of the trust Use executor s personal name(s), not the name of the deceased Use personal name of partners, not the name of the partnership Use name(s) of trustee(s) followed by account name, not the name of the fund WILLIAM JOHN SMITH <SMITH FAMILY A/C> WILLIAM JOHN SMITH <Est Peter Smith A/C> SALLY JANE JONES AND DAVID ASHLEY JONES <SALLY JONES & SON A/C> MADELEINE KELLY PTY LTD<KELLY SUPER FUND A/C> William Smith Family Trust Estate of Peter Smith Sally Jones & Son Madeleine Kelly Pty Ltd Superannuation Fund Contact details You must provide a valid mailing address and address (if available) for all future correspondence from us in relation to your investment. Distribution payment details Please provide us with details of the Australian Bank, Credit Union or Building Society account into which you want distribution payments to be made. Declaration and signing Read the declaration section carefully before signing the application form. You must sign the form where indicated. If you are applying in joint names, all applicants must sign. If you are executing the form under a power of attorney, you must attach a certified copy of the power. If you are applying in a company name, you must execute the form in accordance with the company s constitution and the Corporations Act. Adviser details If you are investing through a financial adviser, please complete this section in conjunction with them. Unitholders: Using the reply paid envelope included with your copy of the PDS and personalised application form New Unitholders: Boardroom (Victoria) Pty Limited Level 7, 207 Kent Street Sydney NSW 2000 Incomplete applications There may be instances where we do not receive sufficient information from you. Where this happens, we will contact you to request the necessary information. Any delay in providing the necessary information may mean that we will be unable to process your application. We recommend you carefully read the instructions and complete the application form. If you require assistance with completing the application form, please contact us on Entitlement Offer PDS 45

48 If your application is incomplete and if the additional information is not provided upon request, we may return the application and your Application Moneys to you. Handling of applications Pending the issue of New Units to an Investor, Application Moneys will be held in a trust account that complies with the Corporations Act. No interest will be paid on Application Moneys for the period from receipt until the issue of New Units occurs. Similarly, no interest will be paid to any Investor whose application (or part of an application) is returned by us unfilled. We may, in our absolute discretion, reject in whole or in part any application. We do not need to give any reason for rejection. In exceptional circumstances, where it is considered to be in the best interest of Unitholders, the processing of all applications may be suspended. Contacting us Investment enquiries: In writing: Tel MacarthurCook Fund Management Limited Fax (02) PO Pox K222 mail@macarthurcook.com.au Haymarket NSW 1240 Independent advice You should read this PDS in full prior to completing the application form as it contains important information about this investment opportunity. You should also consider seeking independent financial, taxation and legal advice prior to investing in the Fund. Anti-money laundering Under the AML/CTF Act, certain additional identification information is required of New Investors. We are obliged under legislation to satisfy thorough investor identification and verification requirements prior to accepting your application for Units in the Fund. These requirements are set out below. We may request additional information from you where we reasonably consider it necessary to satisfy our obligations under the AML/ CTF Act. By applying for Units, you agree to the following: You will supply any documentation and other evidence requested by MacarthurCook to enable MacarthurCook to comply with the AML/CTF Act; If MacarthurCook suspects that your investment is in breach of the AML/CTF Act, other similar legislation or any other applicable law, it may take any action it considers appropriate including transferring your Units and refusing or ceasing to provide you with services, in order to comply with its obligations at law or any request of a relevant authority; and MacarthurCook may, with or without notice to you, disclose or otherwise report the details of any transaction, activity or proposed transaction or activity in relation to the Fund (including any personal information) to any reporting body authorised under the AML/ CTF Act or other applicable legislation. 46 AIMS Property Fund (St Kilda Road)

49 AML/CTF Checklist Please provide appropriate identification documents below, in conjunction with your application form. Please note those qualified to certify documents for AML/CTF Act purposes are different from those who are ordinarily qualified (see full list of qualified persons on our website). Individual Please provide the documentation from either A or B: A certified copy of one of the following non-expired documents: an Australian driver s licence containing a photograph of the person, or A an Australian passport which must be current or which has expired within the last 2 years, or an identification card issued by a state or territory that contains the date of birth and a photograph of the card holder, or a national identity card issued by a foreign government containing a photograph of the person in whose name the card is issued, or a foreign driver s licence that contains a photograph of the person*, or a foreign government, United Nations or United Nations agency issued passport or similar travel document containing a photograph and signature of the person*. A certified copy of one of the following documents: a birth certificate, or birth extract issued by a State or territory, or an Australian citizenship certificate, or a pension card issued by Centrelink, or a foreign driver s licence that contains a photograph of the person*, or B a citizenship certificate issued by a foreign government*, or a birth certificate issued by a foreign government, United Nations or United Nations agency*. PLUS one of the following An original notice that contains the name and residential address of the person, and is: issued by the Commonwealth or a state or territory within the preceding 12 months that records the provision of financial benefits, or issued by the Australian Taxation Office within the preceding 12 months; and records a debt payable to or by the person by or to the Commonwealth, or issued by a local government body or utilities provider within the preceding 3 months that records the provision of services to that address or to that person. * Where the document is not in English, it must be accompanied by an English translation prepared by an accredited translator. Individual acting in the capacity of a sole trader Please provide the following: verification documents of individuals (listed above); and a current original or certified copy of a business name search (if any). Partnership Please provide the following: a certified copy or certified extract of the current partnership agreement; or a certified copy or certified extract of minutes of a partnership meeting. Either copy must include: the full name of the partnership; the full business name (if any) of the partnership, as registered undr the business names legislation; the country in which the partnership was established; and the full name and residential address of each partner. Please also provide the documentation required for individuals (listed on the previous page) for one partner. Entitlement Offer PDS 47

50 Company Please provide the following: An original or certified copy of a search of the ASIC database showing: the full name of the company; the ACN; the registered office address of the company; the principal place of business of the company; the names of each director (only provide if a proprietary company); the names and addresses of each beneficial owner of the company (only provide if a proprietary company that is not licensed and is not subject to government regulation). Trusts / Superannuation Funds For all trusts (including self-managed super funds/wrap trusts/master trusts/idps) please provide the original trust deed or a certified copy or certified extract of the trust deed confirming: full name of the trust; type of trust; country where the trust was established; and name of each beneficiary or class of beneficiary. If the trust is a unit trust you will need to provide a certified extract of the trust register to confirm the name of each beneficiary. If the trustee is an individual/s, please also provide documentation required for one of the individuals (listed on the previous page). If the trustee is a company, please also provide documentation required for companies (listed above). 48 AIMS Property Fund (St Kilda Road)

51 Section 14. Application form - New Investors AIMS PROPERTY FUND (ST KILDA ROAD) ARSN MACARTHURCOOK FUND MANAGEMENT LIMITED AFSL No This application form is to be completed by New Investors who wish to apply for New Units as part of the pro rata non-renounceable Entitlement Offer made in the PDS for the AIMS Property Fund (St Kilda Road) dated 17 October You should read the PDS in full before filling in this application form if you want to apply for New Units in the Fund. It contains important information about the Fund and investment in the New Units. This Application Form must be accompanied by the PDS when provided to any person. Application Amount I/We apply for $ A of New Units at a price of $0.245 per Unit and enclose full Application Amount for the total amount payable Please make cheques payable to: AIMS Property Fund (St Kilda Road) and cross Not Negotiable. Any election made in section H will be deducted from your Application Amount. B Type of investor (please X appropriate box) Individual Joint Company Trust Super Fund Partnership Other C Investor details Please complete this section in conjunction with the AML/CTF Checklist on pages 47 and 48. If AML/CTF information requirements are not satisfied, your application will not be accepted. If you are an investor in another MacarthurCook fund please provide the Account Number (i) Individual / Joint / Individual Trustee details Investor 1 Title Given name Surname Date of Birth TFN or reason for exemption Country of residence for tax purposes (if not Australia) Business Name (for Sole Trader) ABN (for sole trader, if issued) Investor 2 Title Given name Surname Date of Birth TFN or reason for exemption Country of residence for tax purposes (if not Australia) (ii) Partnership (One partner must complete all details below) Title Given name Surname Date of Birth TFN or ABN or reason for exemption Partnership Name and Business Name (if applicable) Country where established (iii) Company / Corporate Trustee Full Name of Company / Corporate Trustee TFN or ABN or reason for exemption ACN (iv) Trust / Superannuation Fund (Trustee to complete these details and either (i) or (iii) as relevant) Full Name of Trust TFN or ABN or reason for exemption Country where Trust is established Entitlement Offer Application Form 49

52 AIMS PROPERTY FUND (ST KILDA ROAD) ARSN MACARTHURCOOK FUND MANAGEMENT LIMITED AFSL No Full Business Name (if any) of Trustee ARSN (if registered managed investment scheme) Type of Trust (i.e. Unit Trust) Country where established D Contact details Residential address (if a company or corporate trustee, provide registered office address) Suburb, City or Town State Postcode Country (if not Australia) Home telephone Telephone (Business Hours) Mobile address Postal address (if different to residential address) Suburb, City or Town State Postcode Country (if not Australia) E Distribution payment details Please make deposits to the following account: Financial Institution BSB Number Account Name Account Number 50 AIMS Property Fund (St Kilda Road)

53 AIMS PROPERTY FUND (ST KILDA ROAD) ARSN MACARTHURCOOK FUND MANAGEMENT LIMITED AFSL No F Declaration and signing By completing, signing and lodging this application form, you agree and acknowledge that: You have read and understood the PDS in full to which this application form relates; You will be bound by the Constitution of the Fund and terms of the PDS; You have made an offer for New Units in the Fund and that offer cannot be revoked; We may accept or reject this application in whole or in part; If you are a New Investor, you will only be issued New Units if there are additional Units available for issue after existing Unitholders have received their subscription amount; You have had the opportunity to seek independent professional advice regarding the legal, taxation and financial implications of investing in the Fund; You have not relied on any statements or representations made by anybody (including MacarthurCook and its officers, employees or agents) prior to applying, other than those representations made in this PDS; You acknowledge that an investment in the Fund is subject to investment and other risks, including possible delays in repayments and the loss of income and the loss of capital invested; You acknowledge that MacarthurCook does not guarantee the performance of the Fund or the return or repayment of capital or income; You authorise us to give information relating to your account and investment to your adviser; Moneys invested in the Fund do not represent an investment in or a deposit of or other liability of the Responsible Entity and an investment is subject to investment risk, including possible delays in the payment of distributions and loss of income and capital investment; MacarthurCook will use personal information provided for the purposes of accepting the application and for the purpose set out in the PDS. Unless you mark this box with an X, MacarthurCook may use your personal information to offer you products or services that may be of interest to you; This application form must not be handed out or used unless attached to or accompanied by the PDS. If received through electronic means, you declare you received the application form accompanied by or attached to a print out or paper copy of this PDS. New Units will only be issued on receipt of an application form issued together with the PDS; A complete copy of the paper form of the PDS, this form, and any supplementary documents will be sent to you free of charge upon request; The Entitlement Offer under the PDS is only available to people receiving the PDS within Australia; The information contained in the PDS and the application form is not investment advice or a recommendation that New Units are suitable for you given your investment objectives, financial situation or particular needs; None of the entities mentioned throughout this PDS guarantee the performance of the Fund, payment of interest or any return of capital; You authorise MacarthurCook and the Fund to register you as the holder of the New Units allotted to you; You authorise MacarthurCook and the Fund, and their respective officers or agents, to do anything on your behalf necessary for the New Units to be issued to you, including to act on instructions of the registry upon using the contact details set out in the application form; That if this application is signed under Power of Attorney, the Attorney verifies that no notice of revocation of that power has been received at the date of completing this application; For all accounts types other than individual and joint accounts, that the application is signed in accordance with the governing rules and/or constituent documents of the entity which is the applicant; You represent and warrant that the law of any other jurisdiction does not prohibit you from being given the PDS or making an application pursuant to the application form; Having read and understood the PDS dated 17 October 2013, and where this document has been obtained through electronic means, then you/we declare that you/we received a printout which comprised the whole PDS and the application form before making an application for New Units in the Fund; That you/we have no reason to suspect that the moneys used to fund this application, or any subsequent contributions into the Fund, is or will be derived from or related to any money laundering, terrorism financing and other illegal activities; By providing your address at section D, the Responsibly Entity may use this address to provide you, where permitted by law or regulation, with information via about your investment and the Fund, including to deliver financial services disclosure and to satisfy any continuous disclosure requirements; and You are over 18 years of age and have full legal capacity and power to perform all your rights and obligations under the application form. Entitlement Offer Application Form 51

54 AIMS PROPERTY FUND (ST KILDA ROAD) ARSN MACARTHURCOOK FUND MANAGEMENT LIMITED AFSL No Name of investor 1 Signature Position of investor (if applicable) Sole Director Director Trustee Name of investor 2 (if joint investors, both must sign) Signature Position of investor (if applicable) Secretary (Company investment only) Director Trustee Name of investor 3 (if applicable if joint investors, all must sign) Signature Position of investor (if applicable) Secretary (Company investment only) Director Trustee Company seal (if required) G Adviser details (if applicable) Adviser Name Dealer Group Name Adviser Address Suburb State Postcode Contact Telephone Number Address (must be provided for Investor confirmations) 52 AIMS Property Fund (St Kilda Road)

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57 Corporate Directory Issuer and Responsible Entity MacarthurCook Fund Management Limited ABN AFSL NO Level 16, 323 Castlereagh Street Sydney NSW 2000 Tel: Fax: (02) Board of Directors of MacarthurCook George Wang (Executive Chairman) Richard Nott (Non-Executive Director) John Love (Non-Executive Director) Registry Boardroom (Victoria) Pty Limited Level 7, 207 Kent Street Sydney NSW 2000 MacarthurCook Investor Services Telephone: