The Trinidad and Tobago Securities and Exchange Commission has not in any way evaluated the merits of the securities offered hereunder and any

Transcription

1 The Trinidad and Tobago Securities and Exchange Commission has not in any way evaluated the merits of the securities offered hereunder and any representation to the contrary is an offence.

2 Certificate of Sponsor This Prospectus has been seen and approved by the Directors of First Citizens Asset Management Limited and they collectively and individually accept full responsibility for the accuracy of the information given and confirm that, after having made all reasonable enquiries, and to the best of their knowledge and belief, there are no false or misleading statements or other facts the omission of which would make any statement herein false or misleading. The Directors of First Citizens Asset Management Limited accept responsibility accordingly. ORIGINAL PROSPECTUS SIGNED BY BOARD OF DIRECTORS FIRST CITIZENS ASSET MANAGEMENT LIMITED Michael Toney Chairman Larry Howai Rita Persaud-Kong (Mrs) Gordon Borde Kenneth Henry

3 Table of Contents Corporate Directory 2 Statement of Affiliation 3 Definitions of Key Terms 3 Prospectus Summary 4 Risk Disclosures 5 The Fund 6 Eligibility Requirements 6 Benefit to Investors 7 Special Risk Considerations 7 Fund Objectives and Investment Guidelines 7 Management Fees and Expenses 8 Net Asset Value 9 Description of Units 10 Price of Unit 10 Subscriptions 10 Redemption of Units 10 Distribution 11 Tax Considerations 11 Pursuant to Section 69 of the Securities Industry Act 1995 (SIA), this Prospectus has been filed with the Trinidad and Tobago Securities and Exchange Commission (SEC) and a receipt therefore has been issued by the Commission for the purpose of giving information to the public with regard to the Paria Fund. This prospectus contains information to help you make an informed investment decision and to help you understand your rights. It contains information about the collective investment scheme. You are encouraged to read this prospectus in its entirety, prior to making any investment decisions. 1

4 Corporate Directory The Trustee/Custodian First Citizens Trustee Services Limited is the Trustee/ Custodian of the Paria Fund. The Trustee/Custodian has a fiduciary responsibility to the unitholders of the Fund. The Trustee/Custodian will act as custodian of the Fund s assets and will ensure that the rights of the unitholders are in no way infringed. The Trustee/Custodian will determine the Net Asset Value (NAV) of the Fund and may also make arrangements for the Fund to borrow under the conditions set out in the Trust Deed on the advice of the Investment Manager. The Investment Manager First Citizens Asset Management Limited is the Investment Manager of the Paria Fund. The major role of the Investment Manager is to provide a continuous investment programme for the Fund s portfolio, making day to day investment decisions and carrying out other related portfolio activities. These will include the purchase and sale of the Fund s assets and the general management of the Fund s investments in accordance with the stated objectives and policies of the Fund. The Fund Administrator First Citizens Asset Management Limited is the Fund Administrator of the Paria Fund. The Fund Administrator performs or arranges for the performance of the administrative services necessary for the daily operation of the Fund. These include maintaining the accounts, books and records of the Fund, providing reports and other required documents, and providing the Fund with administrative office facilities. The Fund Administrator acts as Registrar of the Fund to maintain a record of all unitholders and performs the role of transfer agent and income paying agent. The Sponsor/Distribution Agent First Citizens Asset Management Limited is the Sponsor/Distribution Agent of the Paria Fund. The Sponsor/Distribution Agent shall offer the Fund for sale to the public in accordance with the provisions of the Trust Deed and Rules and shall distribute the Fund throughout the islands of Trinidad and Tobago. The Legal Adviser The firm of Pollonais, Blanc, de La Bastide & Jacelon, Attorneys-at-Law, of Pembroke Street, Port of Spain is the Legal Adviser to the Fund. The Auditor The firm of PricewaterhouseCoopers of Victoria Avenue, Port of Spain is the Auditor of the Fund. 2

5 Statement of Affiliation First Citizens Asset Management Limited is a wholly-owned subsidiary of First Citizens Bank Limited. Definitions Average Net Asset Value For any period the aggregate Net Asset Value (NAV) for each day of such period divided by the number of days in the period for which the Average Net Asset Value is being calculated. Business Day Any day when commercial banks are authorized or required by law to be open for business in Trinidad and Tobago. Distribution A distribution declared by the Trustee/Custodian out of the profits of the Fund. Distribution Date The date in each month on which the Trustee/Custodian declares a distribution in respect of the preceding calendar month. Fund The initial subscription of US$5,000,000 and all other subscriptions to the Fund received by the Trustee/Custodian and the investments and securities or other assets from time to time representing such subscriptions and all interest, accruals and bonuses thereon. Fund Administrator First Citizens Asset Management Limited or any other Fund Administrator from time to time appointed by the Trustee/ Custodian. Investment Manager First Citizens Asset Management Limited or any other Investment Manager of the Fund from time to time appointed by the Trustee/Custodian. Investor The person for the time being registered as the holder of Units in accordance with the Trust Deed and the Rules. Mutual Fund An investment vehicle which makes investments on behalf of individuals and institutions. A mutual fund pools investors contributions and purchases a variety of securities. Net Asset Value The value of the assets of the Fund less liabilities at the close of business every day determined by the Trustee/Custodian in accordance with the Trust Deed and the Rules. 3

6 Definitions - Cont d Open-ended Fund Fund in which the number of units in issue varies from day to day. Register The Register of Investors established and maintained by the Registrar in accordance with the Trust Deed and the Rules. Registrar First Citizens Trustee Services Limited or other Registrar for the time being appointed by the Trustee/Custodian. Sponsor/Distribution Agent First Citizens Asset Management Limited or any other Sponsor/Distribution Agent of the Fund from time to time appointed. Subscriber Any person subscribing for Units in the Fund. Trustee/Custodian First Citizens Trustee Services Limited for the time being appointed. Unit A unit in the Fund collectively representing all capital sums invested therein based on a sum of US$10 (or TT$ equivalent) originally invested by way of subscription in the Fund. Unit Value The value of each Unit on any Valuation Date determined by dividing the Net Asset Value on such date by the number of Units held by Investors. Valuation Date Every day on which the Net Asset Value is determined by the Trustee/Custodian. Summary The following is only a summary of the information contained in the Prospectus and prospective purchasers are advised to read the entire Prospectus prior to deciding whether to invest in the securities being distributed. This Prospectus is issued by First Citizens Trustee Services Limited (the Trustee/Custodian), a corporation licensed under the Financial Institutions Act 1993 to carry on business of a financial nature which includes the unit trust class of business. 4

7 Summary - Cont d This Prospectus concisely sets forth information a prospective investor should know about the Paria Fund (the Fund) before investing and is based on information available as of July 23, It is being furnished to be used solely in connection with your consideration of the purchase of an interest in the Fund and may not be reproduced or redistributed without the consent of the Trustee/Custodian. No person has been authorized to make any statement, give any information or make any representations other than those concerning the Fund or the offering described herein as set forth in this Prospectus and any such statements, information or representations if made or given must not be relied upon. Investors are solely responsible for deciding whether to invest initially or whether to redeem their investments in whole or in part. Neither First Citizens Asset Management Limited nor any of its officers, directors, principals or employees shall have any obligation or liability to investors with regard to any recommendation, advice or decision made in connection with any investment in the Fund or any redemption from the Fund. Risk Disclosures Investment in the Fund is at the sole risk of the investor. Payments of capital and distributions are entirely dependent on the gains and losses derived from the securities and other assets comprising the Fund from time to time. Unlike some bank deposits or other investments which pay a fixed yield for a stated period of time, the yield and total rate of return of the Fund may vary depending upon interest rates, the current market value of the securities held in the Fund s portfolio, changes in currency exchange rates and changes in the Fund s expenses. There is no assurance that the Fund s Investment Objectives will be achieved and investors may not receive the amount originally invested in the Fund. The assets of the Fund will be invested in financial instruments, securities and contracts the portfolios of which will be subject to the risk of fluctuations in capital. While the Trustee/Custodian will seek for the Fund to produce positive total investment returns, in any particular year losses may be suffered. The Prospectus does not purport to give legal, tax or financial advice and does not include information relating to events occurring subsequent to its date except as specifically indicated. The delivery of this Prospectus at any time subsequent to its date does not imply that information herein is correct as of 5

8 Risk Disclosures - Cont d any time subsequent to such date. Investments in the Fund are not deposits and accordingly are not insured by the Deposit Insurance Corporation and are not guaranteed by the Central Bank of Trinidad and Tobago, First Citizens Bank Limited, any of its subsidiaries or affiliates or any person or corporation. This Prospectus is not an offer to sell nor a solicitation of an offer to buy Units in the Fund. A copy of the Trust Deed and Rules evidencing the Fund are available for inspection by investors upon request at the Registered Office of the Trustee situated at No. 45 Abercromby Street, Port of Spain. The Fund The Fund is an open ended monthly fixed income fund denominated in United States Dollars promoted and managed by First Citizens Asset Management Limited and trusteed by First Citizens Trustee Services Limited to enable investors to participate in the acquisition and ownership of debt instruments, asset backed securities, securities, treasuries and certificates of deposits by the purchase of Units. Ownership of Units in the Fund is to be evidenced by the recording thereof on the Register. The Trustee/Custodian provides annualized yield quotations for the Fund which represent the income per Unit paid to the investor from interest and other realized income on the assets of the Fund over a specified period of time expressed as a percentage of the current offering price per Unit. A yield quotation may reflect changes in Net Asset Value. Eligibility Requirements Initial investments in the Fund are available in a minimum amount of US$100 (or TT$ equivalent) with subsequent deposits in multiples of US$20 (or TT$ equivalent) to all persons whether resident in or citizens of Trinidad and Tobago or not subject from time to time to any laws restricting such investment. 6

9 Benefit to Investors The Fund offers investors the opportunity to: 1. Participate in a professionally managed portfolio comprised of high quality debt instruments, treasuries and certificates of deposit and other securities in accordance with the Fund s Investment Objectives designed to provide a continued flow of returns to the investor while endeavouring to maintain the value of capital invested. 2. Achieve a level of investment diversification which may otherwise not be attainable by many individual and institutional investors. 3. Invest in a convenient way without the administrative and record keeping burdens normally associated with the direct ownership of securities. Special Risk Considerations All investments entail risks. No investment is suitable for all investors. The Fund is designed as a monthly fixed income fund for investors with short to medium term investment horizons and who have the financial ability and willingness to accept the risks associated with the investment objectives set for the Fund. Investors should recognize that the value of securities and the income earned on them may fluctuate according to the earnings of the issuers, fluctuations in currency exchange rates and changes in economic and money market conditions. Fund Objectives and Investments Guidelines The Fund s Investment Objective is to seek in the first instance high current income through investment in a range of short to intermediate term high quality debt instruments, treasury bills and notes, certificates of deposit and securities of all kinds including debentures, debenture stock, bonds, commercial paper, and other obligations or evidence of debt and other securities denominated in US Dollars issued or guaranteed by companies including securities of or underwritten by affiliates of the Investment Manager, the Trustee/Custodian or any of them, corporations, governments, states, public bodies and authorities municipal or local or other bodies or authorities both present and future in any company, firm, consortium or entity whether situated in Trinidad and Tobago or elsewhere to preserve capital and to provide growth potential with reduced risks. Interest and principal payments will be invested in similar instruments. There can, of course, 7

10 Fund Objectives and Investments Guidelines - Cont d be no assurance that the Fund s investment objectives will be achieved. Fundamental Investment Objectives of the Fund may not be changed without approval by investors in the Fund. If there is a change in the Investment Objectives of the Fund, investors should consider whether the Fund remains an appropriate investment in light of their current financial position and need. The Investment Manager will determine the portfolio mix having regard to the objectives of the Fund, prudent investment criteria, economic and money market conditions, fiscal and monetary policy, and underlying security values. The Fund may hold diversified investments in US Dollars among various market, industrial and commercial sectors as are available. The total assets of the Fund will be invested in US Dollar denominated securities. Investments may be diversified not only by issuers and industry, but also by type of security. The Investment Manager will be responsible for the day to day management of the Fund s investments. Securities of an issuer shall not be purchased if immediately after the purchase more than ten percent of the net assets of the Fund, taken at market value at the time of the purchase, would be invested in securities of the issuer. This would not apply to a purchase of: (a) evidences of indebtedness that have a remaining term to maturity of not more than 365 days that are issued, or fully and unconditionally guaranteed as to principal and interest, by a financial institution regulated in Trinidad and Tobago or a government entity or (b) bonds, debentures, notes or similar instruments representing indebtedness that have a remaining term to maturity of more than 3 years that are issued secured or unsecured by a financial institution regulated in Trinidad and Tobago or a government entity. Securities of an issuer shall not be purchased if immediately after the purchase the Fund holds securities representing more than ten percent of the votes attaching to the outstanding voting securities of that issuer or the outstanding equity securities of that issuer. Securities shall also not be purchased for the purpose of exercising control or direction over or management of the issuer of the security. Management Fees and Expenses The Trustee/Custodian of the Fund is First Citizens Trustee Services Limited of 45 Abercromby Street, Port of Spain. For services rendered to the Fund on a quarterly basis the Trustee/ 8

11 Management Fees and Expenses - Cont d Custodian will receive a fee of 0.25% per annum of the Average Net Asset Value of the Fund to be paid quarterly in arrears and will be reimbursed all out of pocket expenses incurred in carrying out its functions and duties as Trustee/Custodian. Investment Manager The Investment Manager is First Citizens Asset Management Limited of No. 50 St. Vincent Street, Port of Spain. Pursuant to the Investment Guidelines the Investment Manager will manage the investment of the Fund and provide financial advice, guidelines and directions to the Trustee/Custodian. The Investment Manager will receive a fee for services rendered to the Fund of up to a maximum of 2.5% per annum of the Average Net Asset Value of the Fund to be paid quarterly in arrears. In addition, the Investment Manager will be reimbursed all expenses, commissions, fees, charges and other payments made to third parties for brokerage, subcustodian and other services. Fund Administrator The Fund Administrator is First Citizens Asset Management Limited of 50 St. Vincent Street, Port of Spain. For services rendered to the Fund on a quarterly basis the Fund Administrator will receive a fee of 0.20% per annum of the Average Net Asset Value of the Fund to be paid quarterly in arrears. This fee shall be paid by the Trustee/Custodian out of its own fee. The Fund Administrator will be reimbursed all out of pocket expenses incurred in carrying out its functions and duties. Sponsor/Distribution Agent The Sponsor/Distribution Agent is First Citizens Asset Management Limited of 50 St. Vincent Street, Port of Spain. It is intended that the Fund will be distributed throughout the islands of Trinidad and Tobago. A distribution fee of 0.25% per annum on the Net Asset Value of the Fund will be paid quarterly in arrears to the Sponsor/Distribution Agent. Net Asset Value The determination of Net Asset Value will be based upon the value of the portfolio securities less account fees, commissions and withholding tax (if any) and such other administrative expenses as the Trustee/Custodian may deem appropriate for the Fund. Determination of the Average Net Asset Value will be based on the aggregate Net Asset Value for each day within a particular period divided by the number of days in such period for which the Average Net Asset Value is being calculated. 9

12 Description of Units The Fund is constituted as an open-ended mutual fund and accordingly there is no limit to the number of Units which may be issued. An investor in Units in the Fund will have an interest in an undivided proportion of the assets of the Fund. Each Unit of the same class participates equally in the distribution of net income and participates and ranks equally in respect of the assets of the Fund. Each Unit entitles a holder to one vote at any meeting of holders in which a poll is demanded. A Register of investors will be maintained by the Fund Administrator of the record of ownership of Units. Price of Unit The initial subscription price of each Unit in the Fund is US$10 (or TT$ equivalent) each up to such date as the Trustee/ Custodian and the Investment Manager may determine. Thereafter the subscription price shall be the Net Asset Value per Unit. The Trustee/Custodian determines the Net Asset Value per Unit at the close of business on each day that banks are not required to close by virtue of any law or regulation or by the Central Bank of Trinidad and Tobago. Subscriptions The minimum initial investment in Units in the Fund is US$100 (or TT$ equivalent), thereafter additional subscriptions in multiples of US$20 may be made at any time except in respect of re-investment of distributions in which event subscriptions may be less than US$25 (or TT$ equivalent). All subscriptions shall be made by completing the Application Form available at all branches of First Citizens Bank Limited. All subscriptions are subject to acceptance by the Trustee/Custodian on behalf of the Fund and no subscription shall be honoured unless funds equal to the full subscription have been paid. If a subscription is rejected, all monies received with same will be returned immediately without interest within three business days of receipt of such monies. Redemption of Units A holder may redeem any or all of his Units in the Fund at any time upon written notice to the Trustee/Custodian through any branch specifying the number of the Units to be redeemed. 10

13 Redemption of Units - Cont d The redemption price will be determined based on the Net Asset Value per Unit. Redemption of Units jointly held may be authorized by any one of the joint holders. A redemption request for amounts of not more than US$20,000 will be redeemed on the day of the request during the hours of 9am to 2pm A redemption request for amounts in excess of US$20,000 but less than US$50,000 or 1% of the total net asset value (whichever is lower) will be redeemed within five business days of receipt of such request. The Fund s ability to effect timely redemption for any one investor in excess of US$50,000 or 1% of the total net asset value (whichever is lower) during a 60 day period will be subject to general market conditions. Units in excess of this limit may at the sole discretion of the Trustee/Custodian be redeemed in specie in proportion to the underlying assets. Where Units are redeemed in specie any costs incurred will be for the investor s account. The Trustee/Custodian may without giving reason therefore and without liability at any time in its sole discretion redeem some or all of the Units of an investor. There is no charge to redeem Units in the Fund. Distributions Substantially all of the Fund s net income will be distributed to its holders at the end of each month. An investor on application must elect to receive distributions either by cheque, by way of deposit into an account held by the investor with First Citizens Bank Limited or by re-investment in additional Units purchased at their Net Asset Value on the date of purchase. Tax Considerations Interest income of the Fund will be subject to a deduction of tax in accordance with current law. Distributions paid to the Fund other than interest are currently free from tax in accordance with the current law. Distributions made by the Fund to individuals resident in Trinidad and Tobago are not subject to further taxation. Distributions to investors will be subject to tax (to be deducted by the Trustee/Custodian before distribution) at such rate in accordance with applicable law from time to time. Corporate investors will be paid distributions without tax 11

14 Tax Considerations - Cont d deductions however such distributions should be included in such investors tax returns. While the foregoing is a brief summary of some relevant tax considerations, investors should ascertain the impact of taxes on their investment by consulting their own Tax Advisor. An Application Form for the purchase of Units is attached hereto. No part of this publication may be reproduced or used in any form (graphic, electronic or mechanical including photocopying, recording, taping or information storage and retrieval systems) without permission of First Citizens Asset Management Limited. This Prospectus is dated the 14th day of July,

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