Information brochure Crescit Published December 12th 2018

Transcription

1 Information brochure Crescit Published December 12th 2018

2 2 This information brochure has been prepared in accordance with the Alternative Investment Funds Managers Act (2013:561) ( LAIF ) and the Swedish Financial Supervisory Authority's regulations regarding managers of alternative investment funds (2013:10). Manager Crescit Asset Management AB Corporate identity number: Date of company's founding: 5 April 2012 Company's legal form: Limited company Share capital: SEK 1,200,000 Company's registered office and head office: Stockholm Board of Directors Chairman: Christer Franzén Christer Franzén is the Chief Investment Officer of the Ericsson Pension Fund. Board members and deputies: Jonas Granholm Jonas Granholm is the CEO of Crescit Asset Management AB. Lennart Grebelius Lennart Grebelius is a member of the boards of several companies in the textiles and property industries. Gustav Lundeborg Gustav Lundeborg is a fund manager at Crescit Asset Management AB. Carl Nordberg Carl Nordberg is a fund manager at Postens Pensionsstiftelse, where he has been working for more than a decade. Before that Carl was at Länsförsäkringar Bank and Nordea Securities. Reidar Nilsson Reidar has a long experience of working as a controller. Previously, Reidar Nilsson was the CFO at Sätila Holding AB. Senior executives CEO: Jonas Granholm Auditors Öhrlings PriceWaterhouseCoopers AB Peter Nilsson is the auditor in charge. The auditor examines the accounts that form the basis of the annual report for the fund. The manager manages the following funds Crescit Delegation Engagement agreement The manager has entered into an engagement agreement with Wahlstedt & Sageryd Financial Services AB with regard to administration services. The manager has entered into an engagement agreement with RPM, Risk and Portfolio Management AB with regard to risk management services. The manager has entered into an engagement agreement with Skandinaviska Enskilda Banken AB (publ) ( SEB ) with regard to the administration of securities regarding trade in OTC derivatives, risk data services and valuation services. The manager has entered into an engagement agreement with the legal firm Advokatfirman Apriori Advokatbyrå AB regarding rule compliance services. The manager has entered into an engagement agreement with Lûsch & Co Revision AB regarding internal auditing services. The manager has entered into an engagement agreement with Wahstedt & Sageryd Financial Services AB with regard to accounting services. Potential conflicts of interest due to the delegation The manager continuously investigates how conflicts of interest shall be avoided

3 3 and, if conflicts of interest are identified, how they shall be handled. In that SEB provides administration of securities regarding trade in OTC derivatives, risk data services and valuation services, is the fund's depositary and is one of the manager's primary brokers, potential conflicts of interest have been identified. The potential conflicts of interest consist of SEB, in its capacity as depositary, controls services that SEB provides within the scope of the other services. Since the services in question are provided by different, separated departments in SEB and that there is no interaction between these departments with regard to the services (i.e. that the departments are independent in relation to one another), the manager considers the potential conflicts of interest to be handled and prevented in an effective manner. The manager thereby judges that Crescit's unit holders will not be negatively impacted by the engagement relationships with SEB. Fund unit holder register On behalf of the manager, Wahstedt & Sageryd Financial Services AB maintains a register over all unit holders and their holdings. The unit holder's holdings are presented in the form of a semi-annual notice and an annual notice. Primary broker SEB constitutes the primary broker for the fund and the manager has entered into an agreement with SEB regarding the services that SEB will provide in its capacity of primary broker. SEB disposes over some of the fund's assets in that SEB administers securities regarding the fund's trade in OTC derivatives. Conflicts of interest that may arise in relation to SEB are presented more closely above. Depositary The depositary for the fund is SEB. Subscription or redemption of fund units Subscription and redemption Subscription (unit holder's subscription) and redemption (unit holder's redemption) can take place on the last bank day of every month ( Trading Date ). The unit holder shall notify the manager or part designated to act on behalf of the manager that subscription shall be made and in what amount. The subscription notice shall take place on a special form provided by the manager. The unit holder is responsible for ensuring that the notice is duly signed, that the correct bank account number has been provided, that other documents that the manager requires at all times have been sent to the manager or the party the manager indicates and that payment for the fund units has been deposited in the manager's bank account or bank giro account. The minimum amount at the initial deposit to the fund is SEK 10,000,000 as a principal rule, after which deposits are a minimum of SEK 1,000,000 as a principal rule. The request for redemption shall take place on a special form provided by the manager. The unit holder is responsible for ensuring that the notice is duly signed, that the correct bank account number has been provided, that other documents that the manager requires at all times have been sent to the manager or the party the manager indicates. The subscription and redemption notice can not be limited or recalled unless the manager allows it. Upon the redemption of fund units, payment is made as soon as the fund has received payment for any sold units in underlying assets, although no later than within 15 bank days after the Trading Date. If funds for redemption are acquired through the subscription of the fund's financial instruments, such subscription shall take place and redemption carried out as soon as possible. If a subscription could substantially disadvantage the other unit holders, the manager may, following a report to the Swedish Financial

4 4 Supervisory Authority, refrain from the subscription of financial instruments in accordance with that stated in greater detail in Section 10 of the fund provisions. According to Section 10 of the fund provisions, the manager also has the possibility of temporarily postponing the Trading Date upon subscription. Time of subscription and redemption The subscription notice shall have been received by the manager no later than 3:00 p.m. on whole bank days, or 12:00 p.m. half days, five bank days before the Trading Date. Payment for the units shall be available in the fund's bank account or bank giro account no later than three bank days before the Trading Date. Should the request arrive at the manager after 3:00 p.m. on whole bank days, or 12:00 p.m. half days, five bank days before the Trading Date or if payment is not available within the stipulated time, the manager shall carry out the request on the next Trading Date for the fund. The redemption notice shall have been received by the manager no later than 3:00 p.m. on whole bank days, or 12:00 p.m. half days, 15 bank days before the Trading Date. Should the request arrive at the manager after 3:00 p.m. on whole bank days, or 12:00 p.m. half days, 15 bank days before the Trading Date, the manager shall carry out the request on the next Trading Date for the fund. Subscription and redemption price The subscription and redemption price is the fund unit value calculated according to Section 8 of the fund provisions on the Trading Date. The subscription and redemption price is not known when the request for subscription or redemption is submitted to the manager. According to Section 10 of the fund provisions, the manager has the possibility of temporarily postponing the calculation of the subscription and redemption price. Extraordinary circumstances If such extraordinary circumstances have occurred that mean that a valuation of the fund's assets cannot be done in a manner that ensures the fund unit holders' equal rights, such as a consequence of one or more of the markets on which the fund's trading takes place being partially or entirely closed, the manager may, after a report to the Swedish Financial Supervisory Authority, postpone the date of the calculation and publication of the fund unit value, postpone the Trading Date and the calculation of the subscription price and redemption price until trade has resumed. Otherwise, the manager makes the assessment that no liquidity risks exist for the fund. Other The fund unit value is published on the manager's website, but can also be published via other media. Cessation or transfer of the activities If the manager has its permit to conduct operations requiring permits recalled, enters into liquidation, declares bankruptcy or wants to cease the management of a fund, the management of this shall temporarily be assumed by the depositary. The depositary may then transfer the management to another fund management company that has been approved by the Swedish Financial Supervisory Authority. Otherwise, the fund shall be dissolved through the sale of the assets and the net proceeds being distributed to the unit holders. Announcement of this shall be made in the Swedish Official Gazette and kept available at the depositary and the manager unless the Swedish Financial Supervisory Authority grants an an exception in the individual case. Changes to fund provisions Change of the fund provisions may only occur through a decision by the Board of Directors of the manager and shall be submitted to the Swedish Financial Supervisory Authority for approval. Once a change has been approved, the decision shall be available at the manager and depositary and be announced in the manner set forth by the Swedish Financial Supervisory Authority. The changes may affect the fund's characteristics, such as fees and risk profile.

5 5 Tax rules Since 1 January 2012, fund unit holders are annually charged a standard tax for their fund holdings. The standard revenue for private individuals is calculated as 0.4 per cent of the value of the units at the beginning of the calendar year. The standard revenue is taken up in the class of income of capital and taxed at 30 per cent. The standard tax thereby amounts to 0.12 per cent of the fund units' value. A standard revenue that is below SEK 200 is not taxed if there are no other revenues. The annual standard revenue is presented on a statement of earnings to the Swedish Tax Agency, but no tax withholdings are made. Upon dividends from the fund, 30 per cent of the amount paid is withheld as preliminary tax and the dividend amount is presented on a statement of earnings to the Swedish Tax Agency. Upon the redemption of fund units, a capital gain is taxed in an amount of 30 per cent and a loss may be deducted. The capital gain or loss is presented on a statement of earnings or deductions to the Swedish Tax Agency, but no tax withholdings are made. For legal entities and foreign taxpayers, other rules apply. The tax can be affected by individual circumstances and anyone who is uncertain of any tax consequences should seek expert help. Funds to cover liability for damages To cover risks of liability for damages due to faults or negligence in the operations conducted by the manager pursuant to Chapter 3 Section 1 of the Alternative Investment Funds Managers Act, the manager has extra funds in the capital base. Limitation of liability The manager or depositary is not liable for damages due to Swedish or foreign legal enactment, actions by Swedish or foreign authorities, events of war, strike, blockade, boycott, lockout or other similar circumstances. The reservation concerning strike, blockade, boycott and lockout applies even if the manager or depositary is subject to or undertakes such industrial action. Damage that has arisen in other cases shall not be compensated by the manager or the depositary if they have been normally prudent. The manager or depositary are in no way responsible for indirect damage unless the indirect damage is caused by the manager's or depositary's gross negligence. Nor is the manager or depositary liable for damage caused by a unit holder or another party breaking a law, ordinance, regulation or the fund provisions. Hereby, the unit holder is hereby notified that he or she is responsible for documents sent to the manager are accurate and duly signed and that the manager is notified of changes regarding information submitted. The manager or depositary is not liable for damage caused by a - Swedish or foreign - regulated market or another market place, custodian, central securities custodian, clearing organisation, or others that provide corresponding services, or by contractors that the manager or depositary with due care engaged or were referred to the manager. The same applies to damage caused by the aforementioned organisations or contractors having become insolvent. The manager or depositary is not liable for damage that arise for the fund, unit holders in the fund or another party due to a limitation of disposition that may be applied to the manager or depositary regarding financial instruments. If there is an obstruction to the manager or depositary from fully or partially executing measures according to agreement due to a circumstance indicated above, the measure may be postponed until the obstruction has ceased. If the manager or depositary as a result of such a circumstance is prevented from making or receiving payment, the manager or depositary and the unit holder, respectively, shall not be obliged to pay interest on arrears. A corresponding discharge from the obligation to pay interest on arrears also applies if the manager, in application of Section 10 of the fund provisions, temporarily postpones the time of valuation, subscription or redemption of fund units. The fact that unit holders may in some cases nonetheless be entitled to

6 6 damages regardless of that stated above may be pursuant to Chapter 8 Sections and Chapter 9 Section 22 of the Alternative Investment Funds Managers Act. Annual report and fund unit value The fund is recently established and no annual report has been prepared for the fund. The manager will submit an annual report for the fund within four months of the end of the financial year. The report shall be sent to unit holders who request it free of charge and be available at the manager and depositary. The fund unit value is published on the manager's website, but can also be published via other media. Crescit Objective and investment emphasis Crescit is a special fund with an emphasis on the stock market, which means that the fund has expanded possibilities to invest the fund's means in derivative instruments and fund units. The fund's objective is to generate a positive annual return for its unit holders. The fund's return shall be less volatile than the general development on the stock market over time. Crescit has its base in the fixed-income and bond market, but also uses share-index-related derivative strategies and trend following hedge funds. The fund combines these financial derivative instruments on share indexes with bonds and trend following hedge funds, which in the opinion of the manager are the most beneficial at any given time. The fund uses derivative instruments (including OTC derivatives) as a part of the investment emphasis. Using derivative instruments, the fund can establish a so-called leverage effect. The fund uses shorting. The fund's means may be invested in bonds and other promissory notes issued by companies, states, municipalities, national or municipal authorities or an intergovernmental body, with a low to high credit rating. The fund may invest a significant share of the fund capital in other funds. The fund has no comparative index, but rather in its management instead compares itself with a threemonth Swedish treasury bill. The fund's means may be invested in the asset classes of transferable securities, money market instruments, derivative instruments, fund units and accounts at credit institutions. The fund also includes cash and cash equivalents that are necessary for the fund's management. The risk-adjusted return shall be better than a traditional market portfolio. In addition, an investment in Crescit shall be less risky than a traditional investment in the stock market. History of returns The fund is recently established and there is no history of returns to present. Who does the fund suit The fund primarily addresses foundations and other institutions and investors that have good knowledge of the financial markets. Risk assessment method The fund's combined exposures are calculated with an absolute Value at Risk model with a parametric calculation basis. The model is a probability-based statistical measure of the risk in the fund. The measure expresses the loss level the fund is expected to not exceed during a given time horizon with a given degree of statistical certainty. This measure is expressed in a percentage of the fund capital. Fund's risk profile The manager strives for the fund's average risk level, measured as an annual standard deviation over a rolling 12-month period, to amount to 5 to 15 per cent. It should be particularly noted that the average risk level strived for may be higher or lower upon unusual market conditions or extraordinary events. In the fund's risk/return indicator, which can be found in the fund's fact sheet, the fund belongs to risk category 3, which means a medium high risk for changes in the unit value in the fund.

7 7 The fund invests in share index-related derivative instruments, trend-tracking fund units and bonds, which are generally characterised by low risk, but also the possibility of high returns. The indicator primarily reflects increases and decreases in the financial instruments in which the fund has invested. The indicator in the fund's fact sheet reflects the most important risks in the fund, but not the following risks: Counterparty risk: arises if a counterparty does not fulfil its obligations to the fund, such as failure to pay a set amount or not supplying securities as agreed. Liquidity risks: arise if a part of the fund's assets are difficult to sell at a certain time or at a reasonable price. Operational risks: are the risk of loss due to e.g. system crashes, faults caused by the human factor or external events. Derivative risks: the fund has the possibility of using derivative instruments the value of which depends on the value of underlying assets. Small price changes in them can result in large price changes in derivative instruments. Financial leverage The fund may use financial leverage as a part of the investment emphasis to generate returns and enhance the efficiency of the management. Leverage is created through exposures related to derivative instruments and techniques and other instruments. Exposures via derivative instruments and techniques and other instruments increase the total risk level in the fund, but also provide opportunities for better returns. The risks that are primarily affected are the fund's market risk including derivative risks, counterparty risks and liquidity risks (e.g. through higher marginal security requirements that may force the fund to divest positions at a disadvantageous time). Leverage may only be used insofar as the fund does not exceed its investment limits, all risks associated with the use of the leverage can be managed and on condition that the fund's risk level does not deviate from the fund's risk profile. The fund's financial leverage calculated according to the so-called commitment method that was created through exposure to derivative instruments and techniques and other instruments may not exceed 300 per cent of the fund's value. Any pledged assets for the fund's commitments are transferred to the counterparty with Transfer of Title in accordance with terms customary on the market. If the counterparty cannot return the assets, the loss risk is limited by the fund's commitments being netted against the pledged assets, which means that it is only the difference that can be lost. Reporting of risk and liquidity management and financial leverage In the annual report and the semi-annual report, the manager will provide information to unit holders with regard to: Fees - the share of non-liquid assets in the fund, - changes to the fund's liquidity management, - the fund's current risk profile and the risk management system applied, - the total amount for the financial leverage used by the fund, - changes to the highest level of financial leverage the manager may use on behalf of the fund, and - the right to dispose over securities or other guarantees provided according to the arrangement for financial leverage. Maximum fee Information is provided below on the maximum fee the manager may charge according to the fund provisions upon subscription and redemption of fund units and for management, including costs for custody, supervision and auditors. Subscription fee: 0% Redemption fee: 5%

8 8 Management fee: 1% Performance-based fee: 20% Current fees and costs Information is provided below regarding the current fees the manager charges. Subscription fee: 0% Redemption fee: 5%* Management fee: 1% Performance-based fee: 20% * If withdrawal occurs within 12 months from subscription, otherwise 0% Costs are charged to the fund in the form of management fees for the managers of the funds that the fund invests in. Management fees in underlying funds may not exceed 2 per cent in annual fixed management fee and 20 per cent in performance-based fee. If the manager receives return commissions from managers, these go to the fund. In addition to costs in the form of management fees, costs are comprised of transaction costs such as brokerage, taxes, delivery and other costs due to the fund's assets and purchases and sales. The costs vary depending on the management and there is no maximum amount for the fund's costs. Equal treatment and legal consequences of an investment in the fund All unit holders in the fund are treated equal meaning that the units in the fund are equally large and entail equal rights to the property included in the fund. The fund falls under Swedish jurisdiction and is subject to Swedish law. This means that rules regarding recognition and execution of judgements in accordance with Council Regulation (EC) 44/2001 on jurisdiction and the recognition and enforcement of judgements in civil and commercial matters (Brussels I Regulation), the convention on jurisdiction and the enforcement of judgements in civil and commercial matters (Lugano Convention), Council Regulation (EC) 1346/2000 on insolvency proceedings (insolvency regulation), the convention between Denmark, Finland, Iceland, Norway and Sweden regarding bankruptcy (Nordic bankruptcy convention) or the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention) may be applicable.

9 9 Management Regulation Section 1 Fund designation and legal position This alternative investment fund's name is Crescit, hereafter the fund. The fund is a special fund as per the Alternative Investment Funds Managers Act (2013:561) ( LAIF ). The fund capital is jointly owned by the fund unit holders. Every fund unit entails an equal right to the property included in the fund. The fund cannot acquire rights or accept obligations. The manager stated in Section 2 represents the fund unit holders in all matters concerning the fund, decides on the property included in the fund and exercises the rights that originate from the property. The fund is directed at the public. The operations are conducted according to these management regulations, the manager's articles of association, LAIF and other applicable statutes. Section 2 Alternative Investment Fund Manager The fund is managed by Crescit Asset Management AB, corporate identity number , hereafter "the manager". Section 3 Depositary The depositary for the fund's assets is Skandinaviska Enskilda Banken AB (publ), corporate identity number , hereafter "the depositary". The depositary has the task of monitoring the fund's money flows. The depositary shall particularly ensure that all payments from the unit holders have been received and that all cash and cash equivalents in the fund have been booked on cash accounts that have been opened in the fund's name or in the manager's or depositary's name on behalf of the fund. In addition, the depositary shall receive and store the fund's assets. In addition, the depositary shall execute the manager's instructions if they do not conflict with provisions in the law, management regulations, the articles of association or corresponding regulations, and ensure that: - sales, issues, buy-backs, redemption and cancellation of units or shares in the fund are carried out according to law, the management regulations, the articles of association or corresponding regulations, - the value of the fund units is calculated according to the law, the management regulations, the articles of association or corresponding regulations, - compensations for transactions that concern the fund's assets are paid in to the fund without delay, and - the fund's revenues are used according to the law, the management regulations, the articles of association or corresponding regulations. Section 4 Nature of the fund The fund is an absolute return fund, also known as a hedge fund, and thereby differs from traditional unit trusts/mutual funds and bond funds. The fund's primary underlying return drivers are the world's stock markets. The fund's means will primarily be invested in derivative instruments, fund units and bonds. The fund's objective is to achieve a good absolute return at a lower risk than the stock market. In its management, the fund does not compare itself with a stock market index, but rather the Swedish 90-day treasury bills. The fund's investment possibilities are less limited than for mutual funds, primarily in terms of the possibility to invest in derivative instruments and fund units. This provides the fund greater possibilities of utilising desirable risks and reducing such risks that are non-desirable. Section 5 Fund's investment emphasis 5.1 General For the management of the fund's means, Chapter 5 of the Mutual

10 10 Funds Act (2004:46) ( LVF ) shall be applied. The fund's means may be invested in the asset classes of transferable securities, money market instruments, derivative instruments, fund units and accounts at credit institutions. The fund also includes cash and cash equivalents that are necessary for the fund's management. The fund invests in financial instruments without geographical limitation and without restriction to a particular industry. The allocation between the asset classes varies over time. The fund's assets shall be invested in observance of LVF and these management regulations. The fund shall apply the principle of risk distribution at all times. 5.2 Fund's deviations from what applies to mutual funds Transferable securities and money market instruments The fund may invest in transferable securities and money market instruments. In investments in transferable securities and money market instruments, the fund deviates from the following investment limits in LVF: Section 6 Paragraphs 1 and 2 Item 1 of LVF, the fund may invest in bonds and other promissory notes issued or guaranteed by a state, municipality or a national or municipal authority in a country within the EEA or an intergovernmental body of which one or more states within the EEA are members. However, the promissory notes must come from at least six different issues and what comes from a single issue may not exceed 30 per cent of the fund's value. Section 6 Paragraph 3 of LVF, the fund may invest in transferable securities and money market instruments issued by issuers in the same corporate group for a total of 50 per cent of the fund's value. Section 5 of LVF, the fund may invest up to 20 per cent of the fund capital in such transferable securities and money market instruments as stated in Chapter 5 Section 5 of LVF. Fund units The fund may invest in units in mutual funds, special funds, collective investment undertakings and alternative investment funds. In investments in fund units, the fund deviates from the following investment limits in LVF: Section 15 Paragraph 2 of LVF, the fund may invest in units in funds and collective investment undertakings, which according to their management regulations or their articles of association may invest up to 100 per cent of their means in other funds or collective investment undertakings. Section 16 Paragraph 1 of LVF, the fund may invest up to 30 per cent of the fund capital in a single fund or a single collective investment undertaking. Section 16 Paragraph 2 of LVF, the fund may invest up to 40 per cent of the fund capital in such units as stated in Chapter 5 Section 15 Paragraph 3 of LVF. Section 19 Paragraph 1 Item 4 of LVF, the fund may invest up to 50 per cent of the fund capital in units in other funds or collective investment undertakings. Section 15 Paragraph 1 Item 3 of LVF, the fund may invest the fund capital in Swedish and non- Swedish alternative investment funds in accordance with Chapter 4 Sections 2-8 and Chapter 5 Sections 3-7 and Sections of LAIF and which do not meet the criteria in Chapter 5 Section 15 Paragraph 1 Items 3 a and d of LVF.

11 11 Derivative instruments The fund may invest in derivative instruments as a part of the investment emphasis. Underlying assets of the derivative instruments shall be comprised of or relate to any of the asset classes indicated in Chapter 5 Section 12 Paragraph 1 of LVF. In investments in derivative instruments, the fund deviates from the following investment limits in LVF: Section 13 Paragraph 2 of LVF, the fund may have a total exposure related to derivative instruments that exceeds the fund's value. The fund's total exposure related to derivative instruments may, however, as a maximum amount to 300 per cent of the fund's value. Section 14 of LVF, the fund may have an exposure to a single credit institution in transactions with derivative instruments, as per Chapter 5 Section 10 of LVF, that amount to a maximum of 20 per cent of the fund's value and otherwise, the exposure may amount to a maximum of 10 per cent of the fund's value. Other investment limits In deviation from Chapter 5 Sections of LVF, the fund may expose up to 50 per cent of the fund's value to a single company or companies in the same corporate group. Loans against securities Loans against securities may be raised to an equivalent of a maximum of 20 per cent of the fund capital and provided to an equivalent of a maximum of 50 per cent of the fund capital. For this purpose, the fund has obtained an exemption from Chapter 25 Section 21 Paragraph 3 of the Swedish Financial Supervisory Authority's regulations regarding mutual funds (FFFS 2013:9) ( FFFS 2013:9 ). Shorting The fund may sell financial instruments which are at its disposal, but not in its ownership at the time of the transaction (true shorting). The fund may also sell financial instruments which it does not hold at the time of the transaction (naked shorting). For this purpose, the fund has obtained an exemption from Chapter 5 Section 23 Paragraph 1 Item 3 of LVF. 5.3 Risk level and risk measurement The manager strives for the fund's average risk level, measured as an annual standard deviation over a rolling 12-month period, to amount to 5 to 15 per cent. It should be particularly noted that the average risk level strived for may be higher or lower upon unusual market conditions or extraordinary events. 5.4 Value at Risk model The fund's combined exposures are calculated with an absolute Value at Risk (VaR) model with a parametric calculation basis. The risk in the fund may amount to a maximum of 3.16 per cent. In this calculation, a time horizon of one day and a probability of 95 per cent are used. This can be expressed such that the fund's daily results five days out of 100 are expected to entail a loss of 3.16 per cent or more. Should the fund's total exposures exceed 3.16 per cent, the manager shall ensure that the risk level is reduced to below 3.16 per cent as soon as possible. Section 6 Markets The fund's means may be invest in a regulated market or trading platform within the EEA or on an equivalent market or trading platform outside the EEA. Trade may also take place on another market within or outside the EEA that is regulated and open to the public.

12 12 Section 7 Special investment emphasis 7.1 Transferable securities and money market instruments as per Chapter 5 Section 5 of LVF The fund may invest in such transferable securities and money market instruments as referred to in Chapter 5 Section 5 of LVF. 7.2 Derivative instruments The fund may, as is stated in more detail by Section 5 above, invest in derivative instruments (including OTC derivatives in accordance with Chapter 5 Section 12 Paragraph 2 of LVF) as a part of the fund's investment emphasis. In accordance with Chapter 6 Section 2 Paragraph 2 of LVF, the fund may also invest the fund's means in derivative instruments where underlying assets are comprised of or related to commodities on condition that the derivative instruments are subject to trade on a financial market and do not entail an obligation to deliver or receive the underlying asset. 7.3 Fund of funds The fund may invest a significant share of the fund capital in other funds. 7.4 Techniques and other instruments To create leverage in the fund, as presented in greater detail by Section 5 above, the fund may use such techniques and instruments as referred to in Chapter 25 Section 21 of FFFS 2013:9. The highest level for financial leverage (the fund's total exposure related to derivative instruments and techniques and other instruments calculated as per the so-called commitment method) amounts to 300 per cent of the fund's value. Section 8 Valuation 8.1 Valuation of the fund's assets The fund's value is calculated by deducting the liabilities related to the fund from the fund's assets. The fund's assets are comprised of - Financial instruments. - Cash and cash equivalents. - Accrued interest. - Accrued dividends. - Unliquidated sales. - Other assets and receivables related to the fund. The fund's liabilities are comprised of: - Compensation to the manager. - Compensation to the depositary. - Unliquidated purchases. - Tax liabilities. - Other liabilities related to the fund. The fund's assets are valued at the current market value. Market value of listed holdings shall be determined based the last price paid for the holding on the balance sheet date. If the balance sheet date is not a trading day, the corresponding applies for the last trading day before the balance sheet date. Unlisted holdings that are actively traded on an established market that the manager has assessed to be reliable shall be valued in the same way as listed holdings. What should be taken into account is the market place on which the holding is traded and how trade looks in the holding in question. An unlisted holding that is not considered to be priced on an active market can be priced through the use of a valuation technique. Valuation techniques include the use of recently implemented transactions between knowledgeable market parties independent of one another that have an interest in the transaction being carried out and are motivated by customary business conditions. This should primarily take place by deriving a market value by proceeding from similar transactions that took place recently under commercial circumstances. In general, listed and unlisted holdings shall be take up at the value that

13 13 Crescit can establish on objective grounds. This can take place by obtaining market prices from nonapproved regulated markets or socalled market makers or comparing the holding with another holding or index with adjustment for differences, e.g. in risks. If the valuation technique cannot be applied or becomes clearly misleading, the manager shall use a valuation method that is established on the market. For fund units, the valuation shall be based on the most recently established NAV price for the fund. For OTC derivatives as per Chapter 5 Section 12 Paragraph 2 of LVF, market value refers to the last price paid or if such does not exist, the last buying rate. If such prices do not exist, the market value may be established on objective grounds by, for example, the use of generally accepted valuation methods, such as Black & Scholes, Monte Carlo or a lattice model. Transferable securities as per Chapter 5 Section 5 of LVF that are subject to trade on an active market shall be valued in accordance with listed holdings. Transferable securities as per Chapter 5 Section 5 of LVF that are not subject to trade on an active market shall be valued through collection of information on recently performed transactions between knowledgeable market parties that are independent of one another. This can take place by obtaining market prices from unapproved regulated markets/trading places or so-called market makers. The market valuation shall take place on objective grounds. Money market instruments as per Chapter 5 Section 5 of LVF that are subject to trade on an active market shall be valued at the closing price paid. If no such listing exists, an average of the day's latest buying and selling rates shall be used. For money market instruments as per Chapter 5 Section 5 of LVF that are not subject to trade on an active market, the market value shall be based on the quota rates available, based on the latest buying and selling rates for instance. If reliable quotas are not available, the instrument's market value is calculated base on corresponding quotas of instruments with a similar duration, with adjustment for differences in credit risk, liquidity, etc. 8.2 Valuation of fund units The value of a fund unit is the fund's value divided by the number of outstanding fund units. In the calculation of the fund unit value, a rounding to two decimals is done (rounding upwards if the third decimal is five or greater, otherwise downwards). The value of a fund unit shall be calculated on the last bank day of each month ( Trading Date ). For this purpose, the fund has obtained an exemption from Chapter 4 Section 10 Paragraph 4 of LVF. In accordance with Section 10, the manager has the possibility of postponing the time for the calculation and publication of the fund unit value. Section 9 Subscription and redemption of fund units 9.1 Subscription and redemption Subscription (unit holder's subscription) and redemption (unit holder's redemption) can take place every Trading Date (for definition of "Trading Day", see Section 8 above). The unit holder shall notify the manager or the party indicated by the manager that subscription shall be made and in what amount. The subscription notice shall take place on a special form provided by the manager. The unit holder is responsible for ensuring that the notice is duly signed, that the correct bank account number has been provided, that other documents that the manager requires at all times have been sent to the manager or the party the

14 14 manager indicates and that payment for the fund units has been deposited in the manager's bank account or bank giro account. The minimum amount at the initial deposit to the fund is SEK 10,000,000 as a principal rule, after which deposits are a minimum of SEK 1,000,000 as a principal rule. The request for redemption shall take place on a special form provided by the manager. The unit holder is responsible for ensuring that the notice is duly signed, that the correct bank account number has been provided, that other documents that the manager requires at all times have been sent to the manager or the party the manager indicates. The subscription and redemption notice can not be limited or recalled unless the manager allows it. Upon the redemption of fund units, payment is made as soon as the fund has received payment for any sold units in underlying assets, although no later than within 15 bank days after the Trading Date. If funds for redemption are acquired through the subscription of the fund's financial instruments, such subscription shall take place and redemption carried out as soon as possible. If a subscription could substantially disadvantage the other unit holders, the manager may, following a report to the Swedish Financial Supervisory Authority, refrain from the subscription of financial instruments in accordance with that stated in greater detail in Section 10. According to Section 10, the manager also has the possibility of temporarily postponing the Trading Date upon subscription. 9.2 Time of subscription and redemption The subscription notice shall have been received by the manager no later than 3:00 p.m. on whole bank days, or 12:00 p.m. half days, five bank days before the Trading Date. Payment for the units shall be available in the fund's bank account or bank giro account no later than three bank days before the Trading Date. Should the request arrive at the manager after 3:00 p.m. on whole bank days, or 12:00 p.m. half days, five bank days before the Trading Date or if payment is not available within the stipulated time, the manager shall carry out the request on the next Trading Date for the fund. The redemption notice shall have been received by the manager no later than 3:00 p.m. on whole bank days, or 12:00 p.m. half days, 15 bank days before the Trading Date. Should the request arrive at the manager after 3:00 p.m. on whole bank days, or 12:00 p.m. half days, 15 bank days before the Trading Date, the manager shall carry out the request on the next Trading Date for the fund. 9.3 Subscription and redemption price The subscription and redemption price is the fund unit value calculated according to Section 8 on the Trading Date. The subscription and redemption price is not known when the request for subscription or redemption is submitted to the manager. According to Section 10, the manager has the possibility of temporarily postponing the calculation of the subscription and redemption price. 9.4 Other The fund unit value is published on the manager's website, but can also be published via other media. Section 10 Extraordinary circumstances If such extraordinary circumstances have occurred that mean that a valuation of the fund's assets cannot be done in a manner that ensures the fund unit holders' equal rights, such as a consequence of one or more of the markets on which the fund's trading takes place being partially or entirely closed, the manager may, after a report to the

15 15 Swedish Financial Supervisory Authority, postpone the date of the calculation and publication of the fund unit value (Section 8), postpone the Trading Date and the calculation of the subscription price and redemption price until trade has resumed. Section 11 Fees and compensation 11.1 Fee upon subscription and redemption Upon redemption of fund units, the manager is entitled to charge a fee of a maximum of 5 per cent. The fee goes to the manager. The current fee upon redemption is presented by the fund's information brochure Management fee (fixed fee) The management fee amounts to 1 per cent of the fund's value per year. The fee is paid monthly in arrears at 1/12 per cent per month and calculated based on the fund's value on the Trading Date (before subscription and redemption are carried out). The fee covers the manager's management of the fund and costs for custody, supervision and auditors Performance-based fee General In addition to the management fee, a performance-based fee is payable from the fund to the manager. The fee is based on an individual fee model that means that the performance-based fee is paid by the fund, and is charged to the respective unit holder relative to the unit holder's returns. This occurs by the number of the fund unit holder's fund units changing. The number of units for the individual unit holder is derived by proceeding from the unit holder that shall pay the highest performance-based fee per unit. This fund unit holder's net value per unit constitutes the base in the calculation of the new number of units in the fund. Percentage fee, measurement period and return threshold The performance-based fee amounts to 20 per cent of the part of the total return for each individual unit holder that exceeds a return threshold. The return threshold is comprised of the sum of (i) the largest value of (a) the market value of the unit holder's investment (after the management fee to the manager) at the latest time that the fund paid a performance-based fee for the unit holder's investment or (b) the unit holder's acquisition value and (ii) the threshold interest. The threshold interest corresponds to the average Swedish 90-day treasury bill in the previous calendar quarter's last three bank days (threshold interest rate) adjusted to the relevant time period, multiplied by the largest value of (a) and (b). Fee withdrawal and sub-returns The fee is calculated and paid monthly in arrears and calculated based on the fund's value on the Trading Date (before subscription and redemption have been carried out). If a unit holder receives a return amount during any month that is below the threshold interest, and during a later month a positive return arises, no performancebased fee shall be paid by this fund unit holder until the previous period's sub-returns (difference between received return amount and the threshold interest) have been recovered. If a unit holder redeems his or her fund units and at the same time has an accumulated sub-return on the balance as per the compensation model applied, the unit holder cannot utilise the accumulated subreturns after redemption. Rounding The number of fund units is rounded to six decimals. Rounding of the fee's size is done down to the

16 16 nearest whole SEK. The threshold interest rate is rounded to two decimals Other fees Fees concerning underlying funds will be charged to the fund. More detailed information is in the fund's annual report, information brochure and fact sheet. Transaction costs, such as brokerage, taxes, delivery and other costs in conjunction with the fund's assets and purchases and sales thereof, shall be charged to the fund. Section 12 Dividends from the fund The fund provides no dividend as a main rule. The manager can, however, decide on a dividend to the fund unit holders if it, in the manager's opinion, is necessary to safeguard the unit holders' common interests. Dividends are then paid to such an extent and on the date deemed appropriate. For the dividend on a fund unit, the manager shall, after possible deductions for preliminary tax, acquire new fund units on behalf of the unit holder who on a set date is registered for the fund unit. On the request of a fund unit holder, dividends shall - after potential tax withholdings - instead be paid out to the unit holder. Such a request shall be presented no later than the date the manager has set. Section 13 Fund's financial year The fund's financial year is the calendar year. Section 14 Semi-annual report and annual report, change of management regulations The manager shall submit a semiannual report for the first six months of the financial year within two months of the end of the half year and an annual report for the fund within four months of the end of the financial year. The reports shall be sent to unit holders who request it free of charge and be available at the manager and depositary. Change of the management regulations may only occur through a decision by the Board of Directors of the manager and shall be submitted to the Swedish Financial Supervisory Authority for approval. Once a change has been approved, the decision shall be available at the manager and depositary and be announced in the manner set forth by the Swedish Financial Supervisory Authority. Section 15 Pledging and transfer of fund units Pledging of fund units shall be reported to the manager in writing. The report shall indicate: - who the unit holder and pledge holder are, - what units are covered by the pledge, and - any limitations of the scope of the pledge. Unit holders shall be notified in writing that the manager has made a note of the pledge in the register of unit holders. The pledge ends when the pledge holder notifies the manager in writing that the pledge shall end and the manager has removed the note of the pledge from the register of unit holders. Transfer of fund units requires that the manager allows the transfer. A request for transfer shall be submitted to the manager in writing. The request of a fund unit transfer shall be signed by the unit holder and shall indicate: - who the unit holder is and to whom the units shall be transferred, - the unit holder's personal/corporate ID number, - address, - phone numbers, - securities account or custodian and depot number, - bank account, and - the purpose of the transfer.

17 17 The manager has the right to SEK 1,500 in compensation from the unit holder for a pledge and/or transfer of fund units. Section 16 Limitation of liability The manager or depositary is not liable for damages due to Swedish or foreign legal enactment, actions by Swedish or foreign authorities, events of war, strike, blockade, boycott, lockout or other similar circumstances. The reservation concerning strike, blockade, boycott and lockout applies even if the manager or depositary is subject to or undertakes such industrial action. Damage that has arisen in other cases shall not be compensated by the manager or the depositary if they have been normally prudent. The manager or depositary are in no way responsible for indirect damage unless the indirect damage is caused by the manager's or depositary's gross negligence. Nor is the manager or depositary liable for damage caused by a unit holder or another party breaking a law, ordinance, regulation or these management regulations. Hereby, the unit holder is hereby notified that he or she is responsible for documents sent to the manager are accurate and duly signed and that the manager is notified of changes regarding information submitted. The manager or depositary is not liable for damage caused by a - Swedish or foreign - regulated market or another market place, custodian, central securities custodian, clearing organisation, or others that provide corresponding services, or by contractors that the manager or depositary with due care engaged or were referred to the manager. The same applies to damage caused by the aforementioned organisations or contractors having become insolvent. The manager or depositary is not liable for damage that arise for the fund, unit holders in the fund or another party due to a limitation of disposition that may be applied to the manager or depositary regarding financial instruments. If there is an obstruction to the manager or depositary from fully or partially executing measures according to agreement due to a circumstance indicated above, the measure may be postponed until the obstruction has ceased. If the manager or depositary as a result of such a circumstance is prevented from making or receiving payment, the manager or depositary and the unit holder, respectively, shall not be obliged to pay interest on arrears. A corresponding discharge from the obligation to pay interest on arrears also applies if the manager, in application of Section 10, temporarily postpones the time of valuation, subscription or redemption of fund units. The fact that unit holders may in some cases nonetheless be entitled to damages regardless of that stated above may be pursuant to Chapter 8 Sections and Chapter 9 Section 22 of the Alternative Investment Funds Managers Act. Section 17 Permitted investors The circumstance that the fund addresses the public does not mean that it is directed at such investors whose subscription of units in the fun or participation otherwise in the fund is in conflict with provisions in Swedish or foreign law or regulation. Nor does the fund address such investors whose subscription or holding of units in the fund means that the fund or the manager become obliged to undertake registration measures or other action that the fund or manager would not otherwise be obliged to undertake. The manager has the right to refuse subscription to such investors as referred to in this paragraph above. Unit holders are furthermore obliged to, where applicable, notify the manager of potential changes of national residence.