Standard Life Investments Ignis American Growth Fund. Standard Life Investments Ignis Balanced Growth Fund

Transcription

1 Prospectus Omnibus prospectus for the following funds Standard Life Investments Ignis American Growth Fund Standard Life Investments Ignis Balanced Growth Fund Standard Life Investments Ignis European Growth Fund Standard Life Investments Ignis Global Growth Fund Standard Life Investments Ignis High Income Bond Fund Standard Life Investments Ignis Pacific Growth Fund Standard Life Investments Ignis Smaller Companies Fund Standard Life Investments Ignis UK Equity Income Fund

2 STANDARD LIFE INVESTMENTS UNIT TRUSTS STANDARD LIFE INVESTMENTS (MUTUAL FUNDS) LIMITED PROSPECTUS Valid as at (and dated): 13 July 2015 This document comprises the Prospectus of: Standard Life Investments Ignis Balanced Growth Fund Standard Life Investments Ignis Smaller Companies Fund Standard Life Investments Ignis European Growth Fund Standard Life Investments Ignis Pacific Growth Fund Standard Life Investments Ignis UK Equity Income Fund Standard Life Investments Ignis American Growth Fund Standard Life Investments Ignis Global Growth Fund Standard Life Investments Ignis High Income Bond Fund (the "Funds")

3 TABLE OF CONTENTS Clause Heading Page No. 1 GENERAL INFORMATION ON THE FUNDS MANAGEMENT OF THE FUNDS CHARACTERISTICS OF UNITS IN THE FUNDS GROUPING FOR INCOME EQUALISATION UNITHOLDERS RIGHTS SALE AND REDEMPTION OF UNITS (DEALING) MINIMUM AND MAXIMUM HOLDINGS PRICING AND VALUATION PRELIMINARY (INITIAL) CHARGE PAYMENTS OUT OF THE PROPERTY OF THE FUNDS REDEMPTION (EXIT) CHARGES INVESTMENT POWERS AND LIMITS RISK MANAGEMENT ORDER EXECUTION POLICY ELIGIBLE MARKETS COMMISSION SHARING AGREEMENTS WINDING UP PROVISIONS REGULAR SAVERS GENERAL INFORMATION PROFILE OF THE TYPICAL INVESTOR AND RISKS TAXATION PAST PERFORMANCE APPENDIX 1 THE FUNDS APPENDIX 2 GOVERNMENT AND PUBLIC SECURITIES APPENDIX 3 ELIGIBLE MARKETS APPENDIX 4 RESTRICTED INVESTMENT AND BORROWING POWERS FOR FUNDS APPENDIX 5 OTHER AUTHORISED FUNDS OPERATED BY THE MANAGER UK (i) C:\NRPortbl\UK\CTHU\ _4.docx

4 PROSPECTUS FOR STANDARD LIFE INVESTMENTS UNIT TRUSTS Valid as at 13 July 2015 and effective from that date until revised This Prospectus is prepared in accordance with the rules in the Collective Investment Schemes Sourcebook ("COLL") and incorporates details of the authorised unit trust schemes listed in Appendix 1 operated by Standard Life Investments (Mutual Funds) Limited (the "Manager"). The details included in this Prospectus are valid as at 13 July It is the responsibility of anyone relying on this document to ensure that they have the most current version and that no revisions or corrections have been made. 1 GENERAL INFORMATION ON THE FUNDS The Funds are authorised unit trust schemes as defined in the Financial Services and Markets Act 2000 (the "Act") and for the purposes of COLL are UCITS schemes. The dates on which each Fund was authorised by the Financial Services Authority, the predecessor regulator to the Financial Conduct Authority (the "FCA") are detailed in Appendix 1. Unitholders in each Fund are not liable for the debts of the relevant Fund. The base currency of the Funds is pounds sterling ( ) or any currency or currencies which may be the lawful currency of the United Kingdom from time to time. Any change from pounds sterling to any other currency will take place by operation of law and in such circumstances will not require unitholder approval. 1.1 Investment Objective and Policy The investment objective and policy of each Fund is detailed in Appendix 1. The Funds will not take advantage of the wider investment powers available under COLL and will continue to invest in accordance with the more restricted investment parameters set out in Appendix 4. Descriptions of the COLL investment powers and limits, efficient portfolio management powers, borrowing and stock lending powers are set out in paragraphs 12 to 16 respectively of this Prospectus. 1.2 Annual Accounting Period: the annual accounting period for each Fund is detailed in Appendix Accounting Reference Date (Annual Accounting Date): the date on which the annual accounting period of each Fund ends. The accounting reference date of each Fund is detailed in Appendix Half Yearly Accounting Period: the half yearly accounting period for each Fund is detailed in Appendix Interim Accounting Period: each period within a Fund's annual accounting period in respect of which an allocation of income is to be made. The interim accounting period(s) of each Fund is/are detailed in Appendix Annual Income Allocation Date: The date in each year on or before which an allocation of income is to be made in respect of the previous annual accounting period. The annual income allocation date for each Fund is detailed in Appendix 1. If that day is not a business day, being any day that the London Stock Exchange is open other than a weekend day, bank holiday or any other special concessionary holiday or other day that the London Stock Exchange is not operating normal business hours (a "Business Day"), the annual income allocation date shall be the next Business Day thereafter. UK

5 1.7 Annual Distribution Date: The date in each year on or before which a distribution of income is to be made in respect of the previous annual accounting period or if that day is not a Business Day the annual distribution date shall be the next Business Day thereafter. The annual distribution date for each Fund is detailed in Appendix Interim Income Allocation Date(s): The interim income allocation date(s) (if any) for each Fund are detailed in Appendix 1. If any of those days are not a Business Day, the interim income allocation date(s) shall be the next Business Day thereafter. 1.9 Interim Distribution Date(s): The interim distribution date(s) (if any) for each Fund are detailed in Appendix 1. If any of those days are not a Business Day, the interim distribution date(s) shall be the next Business Day thereafter. 2 MANAGEMENT OF THE FUNDS 2.1 Authorised Fund Manager 1 The Manager of each Fund is Standard Life Investments (Mutual Funds) Limited, Registered Office: 1 George Street, Edinburgh, EH2 2LL. The Manager is a private limited liability company, incorporated under the Companies Acts on 27 February 1990 in Scotland (Registered Number SC123322). It has an issued and fully paid up share capital of 10,000,000. The Manager is authorised to carry on investment business in the United Kingdom by virtue of it being authorised and regulated by the Financial Conduct Authority. Correspondence address: Standard Life Investments (Mutual Funds) Limited PO Box Chelmsford CM99 2EE Tel: (or +44 (0) from outwith the UK) Standard Life Investments (Mutual Funds) Limited is a member of the Standard Life Investments Group. The Directors and Secretary of Standard Life Investments (Mutual Funds) Limited (and their significant business activities not connected with the business of the Funds) are: Directors A S Acheson Director, Standard Life Investments Limited S A Fitzgerald, BA (Hons), ACA J Lowe R J McKillop, BA (Hons), MSc, CFA L Scott, BSc (Hons), FFA D E Thomas, BA, CA 1 Standard Life Investments (Mutual Funds) Limited was appointed as the Manager of the Funds on 13 July Before this date the Manager of the Funds was Ignis Fund Managers Limited. UK

6 S Wemyss Company Secretary H. Kidd, ACIS In performing its role of manager of the Funds, the Manager may delegate such of its functions as it may determine from time to time. As at the date of this Prospectus, the Standard Life Investments group of companies (of which the Manager is part) provides a wide range of services in respect of the Funds, including portfolio management, marketing and distribution, management of suppliers, controls of pricing and expenses and compliance. In addition, external suppliers may be retained by the Standard Life Investments group of companies (including the Manager) for the provision of services. As at the date of this Prospectus services which are provided on an on-going basis by external suppliers include fund administration (valuation, pricing and performance measurement), investor record keeping and transfer agency (ie the processing of applications for sales, redemptions, conversions and switches, servicing investor requests and enquiries relating to the Funds). For the avoidance of any doubt, the Trustee, the custodian and the Auditor are not service suppliers to the Manager or its delegates. 2.2 The Trustee The Trustee of each Fund is Citibank International Limited, Registered Office: Citigroup Centre, Canada Square, Canary Wharf, London, E14 5LB. A private limited company, authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority and incorporated in England and Wales on with registered number The principal business activity of the Trustee is banking, including acting as a trustee and depositary. The ultimate holding company of the Trustee is Citigroup Inc., a company which is incorporated in New York, USA. The Trustee is required to carry out the duties specified in COLL, including having responsibility for the safekeeping of all the scheme property of the Funds entrusted to it. Subject to COLL, the Trustee has full power to delegate (and to authorise its delegate to subdelegate) its duties. In particular, the Trustee has power to delegate custody of the scheme property and has, in exercise of those powers, appointed HSBC Bank Plc as global custodian. The Trustee has also delegated its registrar functions to the Manager. Details of the fees paid to the Trustee are set out in paragraph 10.2 of this Prospectus. 2.3 Registrar, Register of Unitholders and Associated charges The Registrar of each Fund is Standard Life Investments (Mutual Funds) Limited (details provided in paragraph 2.1). As at the date of this Prospectus, the Manager has delegated certain of the registrar s operational duties to International Financial Data Services Limited ( IFDS Limited ). The register of unitholders of each Fund may be inspected at the offices of IFDS Limited at IFDS House, St Nicholas Lane, Basildon, Essex, SS15 5FS. Standard Life Investments (Mutual Funds) Limited as the Registrar will be paid a fixed fee of per UK

7 annum per unit holder per product, which is payable separately to the annual management charge. For more detail, please see section In respect of each Fund, the Manager discharges, at its own expense out of the aggregate revenue received by it in respect of that Fund, the fees of IFDS Limited for discharging its registration duties. 2.4 Investment Adviser The Manager has entered into an Investment Management Agreement with Standard Life Investments Limited ( Standard Life Investments ). Standard Life Investments is an Investment Adviser to each Fund. Standard Life Investments was incorporated as a private limited liability company under the Companies Acts on 27 February 1990 in Scotland (Registered Number SC123321). Its Registered Office is at 1 George Street, Edinburgh, EH2 2LL. It has an issued and fully paid up share capital of 34,440,000. Standard Life Investments is the parent company of the Manager, and is a subsidiary of Standard Life plc. Its principal activity is investment management business. It is authorised to carry on investment business in the United Kingdom by virtue of it being authorised and regulated by the Financial Conduct Authority. The Investment Management Agreement reflects the requirements of the COLL Sourcebook relating to termination and otherwise can be terminated on not less than 3 months notice. Standard Life Investments has full authority to make all investment decisions on behalf of the Manager concerning the scheme property of the Funds managed by it. The Investment Management Agreement gives Standard Life Investments the discretion to appoint, at its own cost, specialist asset management companies from within or outwith the Standard Life group as investment managers in order to benefit from their expertise and experience. In respect of each Fund, the Manager discharges, at its own expense out of the aggregate revenue received by it in respect of that Fund, the fees of the Investment Adviser (in respect of acting as investment adviser) for its services. 2.5 Fund Administrator Under an agreement dated 28 May 2012, HSBC Bank Plc acts as Administrator in respect of the Funds which includes Fund valuation, pricing and performance measurement. HSBC Bank Plc, a company incorporated in England and Wales (registered number 14259), registered office 8 Canada Square, London E14 5HQ. 2.6 Transfer Agency The Manager has delegated certain administration functions to International Financial Data Services (UK) Limited ( IFDSUK Limited ) and IFDS Limited (together IFDS ). These functions include processing applications for the sale and redemption of units, the servicing of certain investor requests and enquiries and other administration services relating to each Fund. In respect of each Fund, the Manager discharges, at its own expense out of the aggregate revenue received by it in respect of that Fund, the fees of IFDS. UK

8 2.7 Marketing Services The Manager has delegated the drawing up of marketing literature to Standard Life Investments Limited. The Manager discharges, at its own expense out of the aggregate revenue received by it out of each Fund, the fees of Standard Life Investments Limited. 2.8 Auditor to the Funds The auditor to the Funds is PricewaterhouseCoopers LLP, Atria One, 144 Morrison Street, Edinburgh, EH3 8EX. 2.9 Other Funds Managed by the Manager Details of the other authorised unit trust schemes and open ended investment companies operated by the Manager as manager or authorised corporate director are set out in APPENDIX. 3 CHARACTERISTICS OF UNITS IN THE FUNDS 3.1 Classes of Units Classes of Units within the Funds Different classes of units may be established in respect of each Fund from time to time by the Manager with the approval of the FCA (where necessary) and the agreement of the Trustee. These may include net income units, gross income units, net accumulation units and gross accumulation units. Different classes of units may be denominated in different currencies and/or have different subscription criteria, minimum holdings and charging structures. Net income units and net accumulation units are currently available in Class A for each Fund. Net income units and net accumulation units are currently available in Class I for the Standard Life Investments Ignis UK Equity Income Fund and Standard Life Investments Ignis High Income Bond Fund. Net accumulation units are currently available in Class I for the Standard Life Investments Ignis Global Growth Fund, Standard Life Investments Ignis American Growth Fund, Standard Life Investments Ignis European Growth Fund, Standard Life Investments Ignis Balanced Growth Fund, Standard Life Investments Ignis Pacific Growth Fund and Standard Life Investments Ignis Smaller Companies Fund. The subscription criteria, minimum holdings and charging structure applying to these classes are set out in paragraphs 7, 9 and 10. A net income unit is one where income is distributed periodically to unitholders, in accordance with relevant tax law, net of any income tax deducted or accounted for by the relevant Fund. A gross income unit is one where income is distributed periodically to unitholders but, in accordance with relevant tax law, without any income tax being deducted or accounted for by the relevant Fund. A net accumulation unit is one in respect of which income (net of any income tax deducted or accounted for by the relevant Fund) is credited periodically to capital within the relevant Fund. A gross accumulation unit is one in respect of which income is credited periodically to capital within the relevant Fund but, in accordance with relevant tax law, without any income tax being deducted or accounted for by the relevant Fund. Holders of income units are entitled to be paid the income attributed to such units of the appropriate class on or before the interim and annual income distribution dates applying to the relevant Fund. UK

9 Holders of accumulation units are not entitled to be paid the income attributable to such units, but that income is automatically transferred to (and retained as part of) the capital assets of the relevant Fund on the interim and annual income allocation dates applying to the relevant Fund and is reflected in the price of an accumulation unit. An income unit represents one individual share in the property of the relevant Fund and an accumulation unit represents a potentially increasing number of undivided shares in the property of the relevant Fund. Each undivided share ranks pari passu with the other undivided shares in the relevant Fund. Unitholders may switch between income and accumulation units of the same class at no charge. Income within the relevant Fund, less relevant charges and expenses, will be distributed or accumulated in full net of tax, although there may be some income held back at interim accounting periods for distribution or accumulation at the next period to smooth the flow of income to unitholders. Any income distributions unclaimed after a period of six years will be forfeited and become part of the capital property of the relevant Fund. The Manager and the Trustee have agreed that any distributions to individual unitholders amounting to less than 5 may be considered "de minimis" and the Manager and the Trustee shall have discretion as to whether a distribution of income is made in such circumstances. If distributions are not made due to "de minimis" considerations the undistributed amounts shall become part of the capital property of the relevant Fund. Distributions shall be paid to unitholders by cheque or, where a unitholder has supplied a duly completed BACS mandate, by BACS payment. Units in each Fund are priced in pounds sterling ( ) which is also currently the base currency of each Fund. The trust deed constituting each Fund (the "Trust Deed") permits further classes of units to be made available other than net income units and net accumulation units in Classes A and I. Each such class may vary by factors such as whether it accumulates or pays out income, or attracts different fees and expenses, or sets different subscription criteria, or has a different minimum holding, or is denominated in a currency other than the base currency of the relevant Fund, and as a result of this monies may be deducted from classes in unequal proportions. In these circumstances, the proportionate interests of the classes within a Fund will be adjusted in accordance with the provisions of the Trust Deed of the relevant Fund relating to proportion accounts, details of which are set out in paragraph 3.2 below. The Funds do not currently offer further unit classes but may seek to do so in the future. The creation of additional unit classes will not result in any material prejudice to the interests of unitholders of existing unit classes. Effective yield method of accounting for fixed interest funds. The Standard Life Investments Ignis High Income Bond is required to account for income from debt securities on an effective yield basis. Effective yield is a method of recognising income from debt securities that takes account of any difference (i.e. premium or discount) between the amount paid for the security and the amount that will be received if the security is held until its redemption date. It has the effect of adjusting the income arising from a debt security to a level more closely aligned with the yield over the lifetime of the security by transferring any premium or discount to or from capital. As such it does not affect total return. UK

10 Prior to this change debt security income was generally accounted for and distributed on a coupon basis. The new rules require the accounting treatment to change to the effective yield method; however, it is permissible in certain circumstances to continue to distribute income on the old coupon basis. This approach makes it possible to distribute a higher level of income; however, it carries a higher risk of capital erosion or constrained future growth. Standard Life Investments (Mutual Funds) Limited have determined that the objectives of the fund, are best served by adopting a distribution policy that follows the effective yield basis for recognising income. This could potentially cause a small reduction in the level of distribution, but any reduction will be offset by a corresponding increase in the capital value. 3.2 Proportion Accounts If there is more than one class of units in a Fund in issue, the proportionate interests of each class of units in the assets and liabilities of that Fund shall be ascertained as follows: A notional account shall be maintained for each class of units. Each account shall be referred to as a "Proportion Account". The word "proportion" in the following paragraphs means the proportion which the balance on a Proportion Account at the relevant time bears to the balance on all the Proportion Accounts of the relevant Fund at that time. There shall be credited to a Proportion Account: the subscription money (excluding any initial charges) for the issue of units of the relevant class; that class s proportion of the amount by which the net asset value of the relevant Fund exceeds the total subscription money for all units in the relevant Fund; that class s proportion of the relevant Fund's income received and receivable; and any notional tax benefit under paragraph below. There shall be debited to a Proportion Account: the redemption payment for the cancellation of units of the relevant class of units; that class s proportion of any amount by which the net asset value of the relevant Fund falls short of the total subscription money for all units in the relevant Fund; all distributions of income (including equalisation if any) made to unitholders of that class of units; all costs, charges and expenses incurred solely in respect of that class of units; that class s proportion of the costs, charges and expenses incurred in respect of that class of units and one or more other classes of units, but not in respect of the relevant Fund as a whole; that class s proportion of the costs, charges and expenses incurred in respect of or attributable to the relevant Fund as a whole; and UK

11 any notional tax liability Any tax liability in respect of any Fund and any tax benefit received or receivable in respect of any Fund shall be allocated between unit classes in order to achieve, so far as possible, the same result as would have been achieved if each class of units were itself the relevant Fund so as not materially to prejudice any class of units. The allocation shall be carried out by the Manager after consultation with the auditor to the relevant Fund Where a class of units is denominated in a currency which is not the base currency, the balance on the Proportion Account shall be converted into the base currency in order to ascertain the proportions of all unit classes. Conversions between currencies shall be at a rate of exchange decided by the Manager as being a rate that is not likely to result in any material prejudice to the interests of unitholders or potential unitholders The Proportion Accounts are notional accounts maintained for the purpose of calculating proportions. They do not represent debts from the relevant Fund to unitholders or the other way round Each credit and debit to a Proportion Account shall be allocated to that account on the basis of that class s proportion immediately before the allocation. All such adjustments shall be made as are necessary to ensure that on no occasion on which the proportions are ascertained is any amount counted more than once When units are issued thereafter each such unit shall represent the same proportionate interest in the property of the relevant Fund as each other unit of the same denomination and class of units then in issue and the respective proportion of income allocated to a particular class shall be allocated equally between each unit of the same class Each Fund shall allocate the amount available for income allocated (calculated in accordance with COLL) between the units in issue relating to the Fund according to the respective proportionate interests in the property of the Fund represented by the units in issue at the valuation point in question. 4 GROUPING FOR INCOME EQUALISATION The Trust Deed for each Fund allows grouping for income equalisation i.e. income earned by a Fund since the last distribution period which is included in the issue or sale price of units issued or sold in the following distribution period. In the case of the first distribution received in respect of a unit following issue or sale, the amount representing the equalisation payment included in the issue or sale price of the unit is returned as capital and is not taxable as income in the hands of the unitholder. This amount is, however, deducted from the cost of the units in computing any capital gains. Equalisation applies only to units issued or sold during the relevant distribution period, and the equalisation payment is the average amount of income included in the issue or sale price of all units of the same class issued or sold in the period. The average is calculated by reference to the income earned and units purchased on a daily basis. 5 UNITHOLDERS RIGHTS Title to units in each Fund is evidenced by entries on the register of holders in respect of each Fund, which is maintained by the Registrar and may be inspected at its offices. Certificates evidencing such title will not be issued. Individual unitholdings are registered in the name of the unitholders. UK

12 The right represented by units is that of a beneficial interest under a trust. Title also enables unitholders to vote at meetings of unitholders. A meeting of unitholders duly convened and held may, subject to COLL, by extraordinary or ordinary resolution, require, authorise or approve any act, matter or document. Unitholders will receive at least 14 days notice of any meeting of unitholders and, subject to particular provisions in COLL relating to the Manager and its associates, are entitled to be counted in the quorum and vote at any such meeting either in person or by proxy. At any meeting of holders an extraordinary resolution will only be passed if 75% or more of the votes validly cast for and against it at the meeting are cast in its favour while an ordinary resolution will be passed if a simple majority of the votes validly cast for and against it at the meeting are cast in its favour. Where a resolution (including an extraordinary resolution) is required to conduct business at a meeting of unitholders and every unitholder is prohibited under COLL 4.4.8R (4) from voting, it shall not be necessary to convene such a meeting and a resolution may, with the prior written agreement of the Trustee, instead be passed with the written consent of unitholders representing 50% or more, or for an extraordinary resolution 75% or more of the units in issue. If a resolution is put to the vote of the meeting it shall be decided on a show of hands unless a poll is demanded by the chairman of the meeting, the Trustee or at least two unitholders. On a show of hands every unitholder who is present in person has one vote. On a poll the voting rights for each unit will be the proportion of the voting rights attached to all of the units in issue that the price of the unit bears to the aggregate price or prices of all of the units in issue. A unitholder entitled to more than one vote need not, if he votes, use all his votes or cast all the votes he uses in the same way. In the case of joint holders the vote of the most senior who votes, whether in person or by proxy must be accepted to the exclusion of the votes of the other joint unitholders. For this purpose seniority must be determined by the order in which the names stand in the register. On a poll, votes may be given either personally or by proxy or in any other manner as the chairman of the meeting may direct. In the context of voting "unitholders" means the persons entered on the register of holders on a cut-off date selected by the Manager which is a reasonable time before the notice of the meeting was sent. 6 SALE AND REDEMPTION OF UNITS (Dealing) 6.1 General Dealings are carried out through authorised intermediaries or direct with the Manager. Units are not listed or dealt in on any investment exchange. The Manager will be available to receive requests for the sale and redemption of units at any time between 9 a.m. and 5.30 p.m. on any Business Day. Written requests for the sale and redemption of units will be accepted. However, the Manager will also allow requests for the sale and redemption of units (unit trust schemes only) by telephone on (or +44 (0) from outwith the UK). The Manager does not guarantee to accept written orders for sales that are not accompanied by a cheque in full settlement. At present, transfer of title by electronic communication is not accepted. All transactions in units are legally binding contracts. In relation to sales of units following receipt of an order, and in relation to redemptions of units following an instruction, the Manager will by the end of the next Business Day, issue a contract note confirming details of the transaction. UK

13 The Manager deals on a forward pricing basis i.e. at prices calculated by reference to the value of the property of each Fund at the next valuation point. The Manager normally deals as principal. Transactions will only be processed in accordance with the procedures required under the Money Laundering Regulations 2007, the Proceeds of Crime Act 2002, the Financial Services and Markets Act 2000, COLL, the FCA's Senior Management Arrangements, Systems and Controls Sourcebook and Joint Money Laundering Steering Group Guidance Notes all as amended from time to time. 6.2 Selling Units Each Fund will have daily valuation points for dealing purposes (12 noon on Business Days), and therefore will be valued and priced on every Business Day. The Manager will not accept an application for units to the value of less than the relevant minimum subscription amount as set out in paragraph 7. If a holding falls below the minimum holding for the relevant unit class then the Manager reserves the right to redeem the units on behalf of the unitholder. The Manager reserves the right to reduce or waive the minimum investment levels. The Manager reserves the right to reject, on reasonable grounds, any application for units in whole or in part. The Manager will return any money sent, or the balance, for the purchase of units, at the risk of the applicant. Once units have been purchased, the Manager will enter the name of the investor on the register. Payment for the units is due and payable to the Manager in settlement of the purchase on the relevant Fund s Settlement Date (as detailed below). Until payment has been passed on by the Manager to the Trustee, an investor will not have an irrevocable right of ownership in the units. Where an investor applies to invest in a Fund, the Manager will hold the money received in advance of the Settlement Date on trust for the investor as client money in a segregated client money account with any recognised bank or banks that the Manager may from time to time select until the Settlement Date. No interest will be paid on money held in these client money bank accounts. In the unlikely event that the Manager were to become insolvent between the purchase of units and the Settlement Date, the money received from an investor would be protected by the FCA s client money rules. In this situation, an investor may not receive the units allocated to them pending settlement; the units may be cancelled. On an insolvency of the Manager in these circumstances the investor s right would be to the return of the money, which would be pooled with other client money. Where payment for units is made by telegraphic transfer, the Manager will generally rely on an exemption from putting that money in a client money account. This exemption is known as the Delivery versus Payment or DvP Exemption. When relying on this exemption, the Manager may treat money which is received from an investor by telegraphic transfer as not being client money for a period of 1 Business Day from the time that the Manager receives the money. If the Manager still holds money received by way of telegraphic transfer beyond the Settlement Date, the Manager will, from that point, treat that money as client money as detailed in the preceding paragraph until the relevant Fund s Settlement Date in accordance with the FCA s client money rules. 6.3 Issuing Units in Specie The Manager may, by special arrangement and at its discretion, agree to arrange for the issue of units in exchange for assets other than cash, but only if the Trustee is satisfied that the acquisition of the assets in exchange for the number of units to be created is not likely to result UK

14 in any material prejudice to the interests of unitholders of the relevant Fund. 6.4 Redeeming Units Each Fund will have daily valuation points for dealing purposes (12 noon on Business Days), and therefore will be valued and priced on every Business Day. Investors redeeming units will receive the value of their investment based on the relevant price of the units on the day of redemption. Generally redemptions will be processed the Business Day of receipt of the notification (provided that it is received before the valuation point on that day). If the notification is received after that day's valuation point, the redemption will be processed at the following Business Day's valuation point. The Manager may refuse to redeem a certain number of units if the redemption would mean that the unitholder would be left holding units with a value of less than the minimum holding for the relevant unit class. The Manager reserves the right to reject, on reasonable grounds, any notification for redemption of units in whole or in part. On the redemption of units, the register will be updated and the relevant holdings removed. Redemption cheques will usually be issued no later than the Settlement Date. Where payment is made by cheque the Manager will protect the payment under the FCA s client money rules from the Settlement Date until such time as the cheque is encashed. Where redemption proceeds are paid by BACS or by telegraphic transfer, typically cleared funds will be paid to the unitholder by the Settlement Date. If the Manager still holds redemption proceeds beyond the Settlement Date, the Manager will, from that point, treat the money as client money until it is paid out. Notwithstanding this, the Manager may, for a period of up to 1 Business Day from receipt of the money from the Trustee rely on the Delivery versus Payment exemption irrespective of the payment method used. If it comes to the notice of the Manager that units are owned whether beneficially or otherwise in circumstances which constitute a breach of the law or governmental regulation (or any interpretation thereof by a competent authority) of any country or territory or which would (or would if other units were acquired or held in like circumstances) result in the relevant Fund incurring any liability to taxation or suffering any other adverse consequence, or if it reasonably believes this to be the case, the Manager may give notice to the unitholder(s) of the relevant units requiring the transfer of such units to a person who is qualified or entitled to own them or that a request in writing be given for the redemption or cancellation of such units in accordance with COLL. If any person upon whom such a notice is served does not within 30 days after the date of such notice so transfer the relevant units or establish to the satisfaction of the Manager (whose judgment is final and binding) that he and any person on whose behalf he holds such units are qualified and entitled to own such units, he shall be deemed upon the expiration of that 30 day period to have given a request in writing for the redemption or cancellation (at the Manager s discretion) of such units pursuant to COLL. Subscriptions and redemptions should be made for investment purposes only. The Funds do not permit short term investment strategies, or any other excessive trading practice which may disrupt portfolio management strategies and harm fund performance. To minimise the harm to the Funds and existing unit holders the Authorised Fund Manager has the right to reject any subscription or redemption requests from any investor who is engaging in excessive or short UK

15 term trading. Neither the funds, nor the Authorised Fund manager, nor the Trustee will be held liable for any loss resulting from rejected orders. All monies and any other cash which constitutes client s money under the FCA Rules shall be held in a non-interest bearing Client Money bank account. No interest is paid to clients in respect of these monies. 6.5 Redeeming Units in Specie If a unitholder requests the redemption or cancellation of units the Manager may arrange that in place of payment of the relevant price of the units in cash, the Trustee cancels the units and transfers property of the relevant Fund or, if required by the unitholder, the net proceeds of sale of such property of the relevant Fund, to the unitholder. The Manager has the discretion whether or not to permit in specie redemption or cancellation of units in any particular case. The Manager will allow this only when it considers it to be in the interests of both exiting and continuing unitholders and only if the Trustee is satisfied that the in specie redemption or cancellation of units is not likely to result in any material prejudice to the interests of unitholders of the relevant Fund. 6.6 Settlement Date For each Fund, the Settlement Date is no later than close of business on the fourth Business Day following the transaction date. The length of time to settlement will depend on the asset or unit classes concerned and could potentially range from T+1 to T+4. (This can at times be referred to as T + [number] where T stands for transaction date.) The transaction date is the date on which the Manager implements an instruction to buy or sell. The Settlement Date is the date on which ownership of the units is transferred and when money passes. For the purposes of settlement Business Day shall (notwithstanding any other definition of Business Day within this Prospectus) mean any day that the London Stock Exchange is open other than a weekend day, bank holiday or any other special concessionary holiday or other day that the London Stock Exchange is not operating normal business hours. By way of example, if an investor instructs the Manager in writing to purchase units at on a Monday (and assuming that all the relevant days are Business Days ), the units will be purchased at the following valuation point (in this case 12 noon on Monday). Monday will be the transaction date, as this is counted as a separate day, and Friday, on a T+4 settlement basis, would be the Settlement Date when payment for the units is due and payable. 6.7 Client Money In certain circumstances (including in relation to the selling and redeeming of units (see pages 10 and 11)), money in respect of units will be transferred to a client money bank account with any recognised bank or banks that the Manager may from time to time select until such transactions can be completed. Money transferred to a client money account will be held in accordance with the rules made by the FCA relating to the holding of client money. The purpose of utilising client money accounts is to protect investors should the Manager become insolvent during such a period. No interest will be paid on money held in these client money bank accounts. The Manager will not be responsible for any loss or damages suffered by unitholders because of any error or action taken or not taken by any third parties holding client money in accordance with the FCA s client money rules, unless the loss arises because the Manager has been negligent or acted fraudulently or in bad faith. Should the recognised bank or banks holding the client money bank account become insolvent, the Manager will attempt to recoup the money on behalf of unitholders. However, if the recognised bank or banks cannot repay all the persons to UK

16 whom it owes money, any shortfall may have to be shared proportionally between all its creditors including unitholders. In this situation, unitholders may be eligible to claim under the Financial Services Compensation Scheme ( FSCS ). Further information about compensation arrangements is available from the Manager on request or from the FSCS at: The Financial Services Compensation Scheme 10th Floor Beaufort House 15 St Botolph Street London EC3A 7QU Telephone: or Website: The Manager may, in certain circumstances permitted by the FCA s client money rules (for example if the Manager decides to transfer all or part of its business to a third party), transfer any client money held in respect of the business being transferred in accordance with the FCA s client money rules, to that third party without that investor s prior consent. On request, the third party must return any balance of client money to the investor as soon as possible. Subject to the FCA s client money rules, the sums transferred may be held by the third party in accordance with the FCA s client money rules, otherwise the Manager will exercise all due skill, care and diligence to assess whether the third party has adequate measures in place to protect unitholder money. The Manager will act at all times in accordance with the prevailing FCA s client money rules. In certain circumstances, if the Manager has lost touch with an investor, the Manager will be permitted to pay the investor s client money balance to charity after six years. The Manager will not do so until reasonable efforts have been made to contact the investor. The investor will still be entitled to recover this money from the Manager at a later date irrespective of whether the Manager has paid the money to charity. 6.8 Conversion of Classes of Units within the same Fund If there is more than one class of units in issue, a unitholder may at any time convert all or some of their units of one Class, (the "Original Units") for units of another Class (the "New Units") subject always to any applicable COLL rules. A unitholder wishing to convert units must provide written instructions to the Manager. On receipt of a valid instruction, the Manager will convert the Original Units to the New Units at the next valuation point. The number of New Units will be determined by applying the conversion factor to the number of Original Units being converted. There will be no charge for the conversion. Conversion instructions will be irrevocable and in no circumstances will a unitholder who converts units be given a right by law to withdraw from or cancel the transaction. Written confirmation of the conversion will be dispatched by the close of business on the first Business Day after the valuation point at which the conversion was processed If a conversion would result in the unitholder holding a number of Original Units or New Units of a value which is less than the minimum holding in the Class of units concerned, the Manager may, if it thinks fit, convert the whole of the applicant's holding of Original Units for New Units (and deem the applicant's instructions to be amended accordingly) or refuse to effect any conversion of the Original Units. No conversion will be made during any period when the right of unitholders to require the redemption of their units is suspended. UK

17 Subject to UK tax, conversions between different unit classes within the same Fund should not give rise to a disposal for UK Capital Gains Tax purposes. Unitholders should however seek professional tax advice in respect of this. 6.9 Switching between Standard Life Investments Funds A unitholder may at any time switch all or some of their units of one Class in that Fund, (the "Original Units") for units or shares of another authorised collective investment scheme operated by the Manager (a Standard Life Investments Fund ) (the "New Units"), subject always to any applicable restrictions on the redemption and issue of units and shares under COLL. A unitholder wishing to switch to another Standard Life Investments Fund should apply in the same way as for a redemption of units and in general the procedures relating to a redemption of units will apply equally to a switch to another Standard Life Investments Fund and the switch will be priced at the next valuation point after receipt of a valid instruction, or at such other valuation point as the Manager at the request of the unitholder, may agree. There is no initial charge when switching between Standard Life Investments Funds. Not all Standard Life Investments Funds are valued at the same time each day. Therefore when switching between Standard Life Investments Funds with different valuation points, the monies may be uninvested for a short period of time. Switching instructions will be irrevocable and in no circumstances will a unitholder who switches units be given a right by law to withdraw from or cancel the transaction. Written confirmation of the switch will be dispatched by the close of business on the first Business Day after the valuation point at which the switch was priced. If a switch would result in the unitholder holding a number of Original Units or New Units of a value which is less than the minimum holding in the Class of units concerned, the Manager may, if it thinks fit, switch the whole of the applicant's holding of Original Units for New Units (and deem the applicant's instructions to be amended accordingly) or refuse to effect any switch of the Original Units. No switch will be made during any period when the right of unitholders to require the redemption of their units is suspended. The Manager may adjust the number of New Units to be issued to reflect the imposition of any charges or adjustments in respect of the issue or sale of the New Units or redemptions or cancellation of the Original Units as may be permitted pursuant to COLL. Subject to UK tax, switches between Standard Life Investments Funds will be treated as a disposal for the purposes of Capital Gains Tax Suspension of Dealing The Manager may, with the prior agreement of the Trustee, and must without delay, if so required by the Trustee, temporarily suspend the issue, cancellation, sale and redemption of units in the relevant Fund, where due to exceptional circumstances it is in the interest of all the unitholders of that Fund. The suspension will only be allowed to continue for as long as it is justified in regard to the best interests of the unitholders. Where the Manager has suspended dealing in the Fund it will immediately inform the FCA of the action taken and as soon as practicable give written confirmation of the suspension and the reasons for it. The suspension will be formally reviewed by the Manager and the Trustee at least every 28 days. The Manager will ensure that all unitholders are informed of the suspension as soon as practicable after suspension commences, making clear the exceptional circumstance which UK

18 resulted in the suspension; and will take all practicable steps to ensure that unitholders are appropriately informed about the suspension including, if known, its likely duration. The suspension of dealings in units will cease as soon as practicable after the exceptional circumstances have ceased. The Manager may, however, during the period in which dealings in units are suspended, agree to deal in units at a price calculated by reference to the first valuation point after resumption of dealings in units. Dealings in units will resume at the next unit issue valuation point following the lifting of the suspension. 7 MINIMUM AND MAXIMUM HOLDINGS 7.1 Class A units No unitholder may normally hold less than 250 of Class A units in any Fund or (unless redeeming his entire holding) redeem less than 100 of Class A units in any Fund in any one deal. The minimum single lump sum investment for each investor in respect of Class A units is 500 (at least 100 per Fund invested). The minimum lump sum top up for each investor in respect of Class A units is 250. The minimum regular monthly contribution for each investor is 50. Only accumulation units may be purchased by making regular monthly contributions. An investor may cease to make regular monthly contributions at any time or reduce the regular monthly contribution provided that, if being reduced, the minimum does not fall below Class I units No unitholder may normally hold less than 1,000,000 of Class I units in any Fund or (unless redeeming his entire holding) redeem less than 1,000 of Class I units in any Fund in any one deal. The minimum single lump sum investment for each investor in respect of Class I units is 1,000,000. The minimum lump sum top up thereafter for each investor in respect of Class I units is 1,000 (subject to the investor already having a unit holding greater than 1,000,000). 7.3 At the Manager's discretion, any of the requirements of paragraphs 7.1 and 7.2 may be waived in any particular case or generally. 8 PRICING AND VALUATION 8.1 Pricing of Units The Funds operate on the basis of dual pricing i.e. there are different prices for the sale and redemption of units in each Fund being: the "sale" or "offer" price the price at which units are sold to investors, and the "redemption" or "bid" price the price at which investors may redeem units. The difference between these two prices is called the "bid/offer spread". There are also different prices for the issue (creation) and cancellation of units in each Fund: the "issue" price - the price payable by the Manager to the Trustee for a unit upon its issue; UK