Itaú Funds
Société d’investissement à capital variable
Luxembourg
Prospectus
Dated October 2015
TABLE OF CONTENTS
INTRODUCTION
4
IMPORTANT INFORMATION
5
1.
GLOSSARY OF TERMS
6
2.
ORGANISATION OF THE COMPANY
11
3.
LEGAL FORM AND STRUCTURE OF THE COMPANY
12
4.
SUB-FUNDS
13
5.
MANAGEMENT AND ADMINISTRATION
14
6.
INVESTMENT OBJECTIVES AND POLICIES
16
7.
RISK FACTORS
16
8.
FORM OF SHARES
19
9.
ISSUE OF SHARES
20
10.
CLASSES OF SHARES
20
11.
SUBSCRIPTION FOR SHARES
20
12.
REDEMPTION OF SHARES
23
13.
CONVERSION OF SHARES
25
14.
TEMPORARY SUSPENSION OF SUBSCRIPTIONS, REDEMPTIONS AND CONVERSIONS
27
15.
LATE TRADING AND MARKET TIMING
27
16.
PROCEDURES FOR SUBSCRIPTIONS, REDEMPTIONS AND CONVERSIONS
REPRESENTING 10% OR MORE OF THE NET ASSETS OF ANY SUB-FUND
27
17.
COMMISSIONS AND CHARGES
28
18.
NET ASSET VALUE
30
19.
TAXATION - APPLICABLE LAW
35
20.
GENERAL MEETINGS AND REPORTS
38
21.
RISK MANAGEMENT
38
22.
TERM, LIQUIDATION, MERGER AND DIVISION LIQUIDATION - TERMINATION AND
AMALGAMATION OF SUB-FUNDS
39
23.
INFORMATION AVAILABLE TO THE PUBLIC
42
24.
DIVIDEND POLICY
42
APPENDIX A INVESTMENT POWERS AND RESTRICTIONS
44
APPENDIX B FINANCIAL TECHNIQUES AND INSTRUMENTS
50
APPENDIX C DETAILS OF EACH SUB-FUND
53
ITAÚ FUNDS - LATIN AMERICA EQUITY FUND
54
ITAÚ FUNDS - BRAZIL EQUITY FUND
59
ITAÚ FUNDS - LATIN AMERICA EX-BRAZIL EQUITY FUND
64
ITAÚ FUNDS - CONSERVATIVE FUND
69
ITAÚ FUNDS - MODERATE FUND
73
ITAÚ FUNDS - GROWTH FUND
77
ITAÚ FUNDS – AGGRESSIVE GROWTH FUND
81
ADDITIONAL INFORMATION FOR INVESTORS IN THE FEDERAL REPUBLIC OF GERMANY
85
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Itaú Funds
Société d’investissement à capital variable
Registered Office:
49, avenue J.F. Kennedy, L-1855 Luxembourg, Grand Duchy of Luxembourg
R.C.S. Luxembourg B 80545
INTRODUCTION
ITAÚ FUNDS is an investment company, qualifying as a SICAV with multiple sub-funds under the laws
of the Grand Duchy of Luxembourg, which envisages investing in a diversified range of transferable
securities and/or other liquid financial assets permitted by law, conforming to the investment policy of
each particular sub-fund.
The Company has been incorporated on 9 February 2001 as a UCI pursuant to part II of the Luxembourg
law of 20 December 2002 on undertakings for collective investment, as amended. The Articles of
Incorporation have been restated on 24 July 2009 to convert the Company into a UCITS. The Company is
registered in the Grand Duchy of Luxembourg pursuant to Part I of the 2010 Law and qualifies as a
UCITS for the purpose of the UCITS Directive. However, such registration does not imply a positive
assessment by the Luxembourg supervisory authority of the contents of the Prospectus or of the quality of
the Shares offered to sale. Any representation to the contrary is unauthorised and unlawful.
The Prospectus does not constitute an offer to anyone or solicitation by anyone in any jurisdiction in
which such an offer or solicitation is unlawful or in which the person making such an offer or solicitation
is not qualified to do so.
The distribution of the Prospectus and the offering of the Shares may be restricted in certain jurisdictions.
It is the responsibility of any persons in possession of the Prospectus and any persons wishing to
subscribe for Shares pursuant to the Prospectus to inform themselves of, and to observe, all applicable
laws and regulations of any relevant jurisdictions. Potential subscribers or purchasers of Shares should
inform themselves as to the possible tax consequences, the legal requirements and any foreign exchange
restrictions or exchange control requirements which they might encounter under the laws of the countries
of their citizenship, residence or domicile and which might be relevant to the subscription, purchase,
holding, conversion or sale of Shares.
Any information not mentioned in the Prospectus should be regarded as unauthorized. The information
contained in the Prospectus is considered to be accurate at the date of its publication. To reflect material
changes, the Prospectus may be updated from time to time and potential subscribers should enquire of the
Company as to the issue of any later Prospectus.
The Board of Directors is held responsible for the information contained in the Prospectus and has taken
all reasonable care to ensure that at the date of the Prospectus the information contained herein is accurate
and complete in all material respects. The directors accept responsibility accordingly.
Subscriptions for Shares can be accepted only on the basis of the current Prospectus. The Company will
produce an Annual Report and Semi-Annual Reports. Following the publication of the first of either
report, the current Prospectus at that date will be valid only if accompanied by such Annual Report or
Semi-annual Report.
The Board of Directors reserves the right to apply in the future for listing the Shares on the Luxembourg
Stock Exchange or any other securities exchanges.
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IMPORTANT INFORMATION
If you are in any doubt about the contents of the Prospectus, you should consult your stockbroker,
solicitor, accountant or other financial advisor. No person is authorized to give any information other than
that contained in the Prospectus, or any of the documents referred to herein that are available for public
inspection at the registered office.
This Prospectus contains forward-looking statements, which provide current expectations or forecasts of
future events. Words such as “may”, “expects”, “future” and “intends”, and similar expressions, may
identify forward-looking statements, but the absence of these words does not mean that a statement is not
forward-looking. Forward-looking statements include statements about the Company’s plans, objectives,
expectations and intentions and other statements that are not historical facts. Forward-looking statements
are subject to known and unknown risks and uncertainties and inaccurate assumptions that could cause
actual results to differ materially from those expected or implied by the forward-looking statements.
Prospective investors should not unduly rely on these forward-looking statements, which apply only as of
the date of this Prospectus.
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1.
GLOSSARY OF TERMS
This glossary is intended to help readers who may be unfamiliar with the terms used in this
Prospectus. It is not intended to give definitions for legal purposes.
2005 Law
The Luxembourg law of 21 June 2005 implementing the EU Savings
Directive in national legislation in Luxembourg, as amended.
2010 Law
The Luxembourg law of 17 December 2010 on undertakings for collective
investment, as amended.
ADRs
American depository receipts.
Annual Report
The annual report of the Company containing the audited accounts.
Articles of
Incorporation
The articles of incorporation of the Company.
Board of Directors
The board of directors of the Company.
Business Day
The business day for each Sub-Fund as specified for each Sub-Fund in
Appendix C.
Central
Administration
State Street Bank Luxembourg S.C.A., in its capacity as the central
administration, domiciliary and corporate agent, registrar and transfer
agent and paying agent of the Company.
Central
Administration
Agreement
The administration agency, domiciliary, corporate and paying agency,
registrar and transfer agency agreement entered into between the
Company, the Management Company and the Central Administration.
Central
Administration Fees
The fees of the Central Administration.
CET
Central European Time.
Class
One class of Shares of no par value in a Sub-fund.
Company
Itaú Funds.
Conversion
Commission
The conversion commission in the case of a conversion.
CSSF
The Commission de Surveillance du Secteur Financier, the Luxembourg
Supervisory Authority.
CSSF Circular 08/356
CSSF Circular 08/356 on the rules applicable to undertakings for
collective investment when they employ certain techniques and
instruments relating to transferable securities and money market
instruments, as amended, supplemented or replaced.
CSSF Circular 14/592
Circular CSSF 14/592 on Guidelines of the European Securities and
Markets Authority (ESMA) on ETFs and other UCITS issues.
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Custodian
State Street Bank Luxembourg S.C.A., in its capacity as the custodian of
the Company’s assets.
Custodian Agreement
The custodian agreement entered into between the Company and the
Custodian.
Custody Fees
The fees of the Custodian.
Distributor(s)
Distributor(s)/nominee(s) for the purpose of assisting in the distribution
and/or marketing of the Shares.
ESMA
The European Securities and Markets Authority (formerly, the Committee
of European Securities Regulators).
ESMA 2014/937
ESMA Guidelines 2014/937 dated 1 August 2014 regarding Guidelines on
ETFs and other UCITS issues.
ETF
An exchange-traded fund.
EU Member State
A member state of the European Union. The states that are contracting
parties to the agreement creating the European Economic Area other than
the member states of the European Union, within the limits set forth by
this agreement and related acts, are considered as equivalent to member
states of the European Union.
EU Savings Directive
GDRs
Council Directive 2003/48/EC on the taxation of savings income, as
amended.
Means the Foreign Account Tax Compliance provisions of the U.S. Hiring
Incentives to Restore Employment Act enacted in March 2010.
Global depository receipts.
Global Distribution
Agreement
The global distribution agreement executed between the Management
Company and the Global Distributor.
Global Distribution
Fees
The fees of the Global Distributor.
Global Distributor
Itaú UK Asset Management Limited.
Initial Price
The initial price of a Class as specified for each Sub-fund in Appendix C.
Initial Subscription
Period
The initial subscription day or the initial subscription period of a Class as
specified for each Sub-fund in Appendix C.
Institutional Investor
An institutional investor within the meaning of articles 174, 175 and 176
of the 2010 Law.
Investment
Management
Agreement
The agreement entered into between the Management Company and each
Investment Manager.
Investment Manager
The investment manager of each Sub-fund as specified in Appendix C.
FATCA
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Investment
Management Fee
The fees of each Investment Manager.
Itaú Group
Itaú Unibanco S.A. and/or any affiliated and/or associated company
thereof.
KIID
A Key Investor Information Document.
Management
Company
UBS Third Party Management Company S.A..
Management
Company Services
Agreement
The agreement entered into between the Company and the Management
Company.
Management
Company Fees
The fees of the Management Company.
Mémorial
Mémorial C, Recueil des Sociétés et Associations.
Net Asset Value
The net value of the assets less liabilities attributable to the Company or a
Sub-fund or a Class, as applicable, and calculated in accordance with the
provisions of this Prospectus.
Other Denomination
Currency
A currency other than the Reference Currency.
Prohibited Persons
Any person, firm, partnership or corporate body, if in the sole opinion of
the Company such holding may be detrimental to the interests of the
existing Shareholders or of the Company, if it may result in a breach of
any law or regulation, whether Luxembourg or otherwise, or if as a result
thereof the Company may become exposed to tax disadvantages, fines or
penalties that it would not have otherwise incurred. Such persons, firms,
partnerships or corporate bodies shall be determined by the Board of
Directors. For the avoidance of doubt, US Persons will by default be
considered as Prohibited Persons.
Prospectus
The prospectus of the Company in accordance with the 2010 Law.
Redemption
Commission
The redemption commission of each Class as specified for each Sub-fund
in Appendix C.
Redemption Price
The redemption price of each Class as specified for each Sub-fund in
Appendix C.
Reference Currency
The reference currency of the Company, a Sub-fund or a Class.
Registrar
Registre de Commerce et des Sociétés, Luxembourg.
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Regulated Market
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a regulated market within the meaning of article 4, item 1.14 of
Directive 2004/39/EC of the European Parliament and of the
Council of 21 April 2004 on markets in financial instruments;
a market in an EU Member State which is regulated, operates
regularly and is recognized and open to the public;
a stock exchange or market in a non-EU Member State which is
regulated, operates regularly and is recognized and open to the
public.
Retail Investor
A retail investor in the Company.
Securities Act
the United States Securities Act of 1933, as amended
Semi-annual Report
The semi-annual report of the Company.
Shares
Shares of the Company.
Shareholders
Holders of Shares.
SICAV
A société d’investissement à capital variable.
Sub-fund
A separate sub-fund established and maintained in respect of one or more
Classes to which the assets and liabilities and income and expenditure
attributable or allocated to each such Class or Classes will be applied or
charged.
Sub-fund Conversion
Deadline
The conversion deadline as specified for each Sub-fund in Appendix C.
Sub-fund Redemption The redemption deadline as specified for each Sub-fund in Appendix C.
Deadline
The subscription deadline as specified for each Sub-fund in Appendix C.
Sub-fund
Subscription Deadline
Subscription
Commission
The subscription commission of each Class as specified for each Sub-fund
in Appendix C.
Subscription Form
The subscription form of the Company.
Subscription Price
The subscription price of each Class as specified for each Sub-fund in
Appendix C.
UCI
An undertaking for collective investment which has as its sole object the
collective investment in transferable securities and/or other publicly
offered liquid financial assets of capital raised from the public and which
operates on the principle of risk spreading and the units/shares of which
are at the request of holders repurchased or redeemed directly or indirectly
out of those undertakings’ assets provided that action taken to ensure that
the stock exchange value of such units/shares does not significantly vary
shall be regarded as equivalent to such repurchase or redemption.
UCITS
An undertaking for collective investment in transferable securities
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authorized pursuant to the UCITS Directive.
UCITS Directive
Directive 2009/65/EC of the European Parliament and of the Council of 13
July 2009 on the coordination of laws, regulations and administrative
provisions relating to undertakings for collective investment in
transferable securities, as may be amended from time to time.
US Persons
means any national or person resident in the United States of America, a
partnership, corporation or other entity organised or existing in any state,
territory or possession of the United States, or any other person or entity
that is either (i) a U.S. Person under Rule 902 of Regulation S under the
U.S. Securities Act of 1933 or (ii) not a “Non-United States person” under
U.S. Commodity Futures Trading Commission Regulation 4.7.
Valuation Day
Each day on which the Net Asset Value of each Class of each Sub-fund
shall be determined, which, unless otherwise provided for in for a
particular Sub-fund in Appendix C, shall be each Business Day.
All references herein to “EUR” are to the Euro, the official currency of the euro area or any successor
currency to be defined as hereinafter. All references to “US Dollars” and “USD” are to United States
Dollars, the lawful currency of the United States of America. All references herein to “Real” are to the
Brazilian Real, the lawful currency of Brazil.
In the event of a Euro break-up, or the composition of countries comprising the Euro experiences a
material change, or the currency no longer exists, a successor currency may be determined by the Board
of Directors at its sole discretion.
The descriptions in the main body of the Prospectus are generally applicable to all Sub-funds. However,
where different descriptions or exceptions appear in Appendix C in respect of a given Sub-fund, the
descriptions or exceptions in Appendix C shall prevail. Thus, it is advisable to carefully review the
relevant Appendixes together with the main body of the Prospectus.
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2.
ORGANISATION OF THE COMPANY
BOARD OF DIRECTORS
Mr. Renato Mansur
Itaú Unibanco S.A.
Av. Eng. de Armando Arruda Pereira, 707 - 14th floor
Torre Eudoro Villela - 04344-902 - Jabaquara
São Paulo - SP
Brazil
Mr. Kenneth Casey
Itaú UK Asset Management Limited
Level 20 – The Broadgate Tower
20 Primrose Street
London EC2A 2EW
United Kingdom
Mr. John Alldis
Carne Global Financial Services Luxembourg
6B, route de Trèves
L-2633 Senningerberg
Grand Duchy of Luxembourg
MANAGEMENT COMPANY
UBS Third Party Management Company S.A.
33A, Avenue J.F. Kennedy
L-1855 Luxembourg
Grand Duchy of Luxembourg
CUSTODIAN
State Street Bank Luxembourg S.C.A.
49, avenue J.F. Kennedy
L-1855 Luxembourg
Grand Duchy of Luxembourg
CENTRAL ADMINISTRATION
State Street Bank Luxembourg S.C.A.
49, avenue J.F. Kennedy
L-1855 Luxembourg
Grand Duchy of Luxembourg
GLOBAL DISTRIBUTOR
Itaú UK Asset Management Limited
Level 20 – The Broadgate Tower
20 Primrose Street
London EC2A 2EW
United Kingdom
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AUDITOR
PricewaterhouseCoopers
2, rue Gerhard Mercator
L-2182 Luxembourg
Grand Duchy of Luxembourg
INVESTMENT MANAGER
Itaú USA Asset Management Inc.
767 Fifth Ave - 50th Floor
New York, NY, 10153
United States of America
LEGAL ADVISOR
Dechert (Luxembourg) LLP
1, allée Scheffer
B.P. 709
L-2017 Luxembourg
Grand Duchy of Luxembourg
3.
LEGAL FORM AND STRUCTURE OF THE COMPANY
ITAÚ FUNDS has been incorporated as a UCI on 9 February 2001 under Luxembourg law as a
SICAV pursuant to part II of the Luxembourg law of 20 December 2002 on undertakings for
collective investment, as amended. The Company has been converted into a UCITS as from 1
September 2009 and is registered in the Grand Duchy of Luxembourg pursuant to part I of the
2010 Law.
The minimum capital of the Company is the equivalent in US Dollars of Euro 1.250.000.
The Articles of Incorporation have been deposited with the Registrar and have been published in
the Mémorial for the first time on 16 March 2001. The Company has been registered under
number B 80 545 at the Registrar.
The Articles of Incorporation were amended for the last time on 19 December 2014 and have not
yet been published in the Mémorial.
The Articles of Incorporation may be amended from time to time by a meeting of Shareholders,
subject to the quorum and majority requirements provided by Luxembourg law. Any amendment
thereto shall be published in the Mémorial, in a Luxembourg daily newspaper and, if necessary, in
the official publications specified for the respective countries in which Company Shares are sold.
If all Shareholders are registered Shareholders, in lieu of a publication, such amendment may be
notified to the Shareholders by mail. Such amendments become legally binding on all
Shareholders, following their approval by the general meeting of Shareholders.
The Company draws the investors’ attention to the fact that any investor will only be able to fully
exercise his investor rights directly against the Company, notably the right to participate in general
shareholders’ meetings, if the investor is registered himself and in his own name in the
shareholders’ register of the Company. In cases where an investor invests in the Company through
an intermediary investing into the Company in his own name but on behalf of the investor, it may
not always be possible for the investor to exercise certain shareholder rights directly against the
Company. Investors are advised to take advice on their rights.
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Any amendments affecting the rights of the holders of Shares of any Class vis-à-vis those of any
other Class shall be subject further to the said quorum and majority requirements in respect of each
relevant Class.
The Company is one single entity; however, the right of investors and creditors regarding a
Sub-fund or raised by the constitution, operation or liquidation of a Sub-fund are limited to the
assets of the Sub-fund, and the assets of a Sub-fund will be answerable exclusively for the rights of
the Shareholders relating to the Sub-fund and for those of the creditors whose claim arose in
relation to the constitution, operation or liquidation of the Sub-fund. In the relations between the
Company’s Shareholders, each Sub-fund is treated as a separate entity.
The Board of Directors may decide to create further Sub-funds with different investment
objectives, and in such cases, the Prospectus will be updated accordingly. The Board of Directors
shall maintain for each Sub-fund a separate pool of assets.
FATCA provisions generally impose a reporting to the U.S. Internal Revenue Service of U.S.
Persons’ direct and indirect ownership of non-U.S. accounts and non-U.S. entities. Failure to
provide the requested information will lead to a 30% withholding tax applying to certain U.S.
source income (including dividends and interest) and gross proceeds from the sale or other
disposal of property that can produce U.S. source interest or dividends.
The basic terms of FATCA currently appear to include the Company as a “Financial Institution”,
such that in order to comply, the Company may require all shareholders to provide documentary
evidence of their tax residence and all other information deemed necessary to comply with the
above mentioned legislation.
Despite anything else herein contained and as far as permitted by Luxembourg law, the Company
shall have the right to:
withhold any taxes or similar charges that it is legally required to withhold,
whether by law or otherwise, in respect of any shareholding in the Company;
require any shareholder or beneficial owner of the Shares to promptly furnish
such personal data as may be required by the Company in its discretion in order to
comply with any law and/or to promptly determine the amount of withholding to be
retained;
divulge any such personal information to any tax or regulatory authority, as may
be required by law or such authority;
withhold the payment of any dividend or redemption proceeds to a shareholder
until the Company holds sufficient information to enable it to determine the correct
amount to be withheld.
4.
SUB-FUNDS
This is an offer to subscribe for Shares issued without par value in ITAÚ FUNDS, each Share
being linked to one of the Sub-funds. The details of each Sub-fund are specified in Appendix C.
Different Classes may be issued in each Sub-fund, as determined by the Board of Directors and
outlined in Appendix C. For further information about the rights attaching to the various Shares
and Classes, see Section 8 “Form of Shares” and Section 10 “Classes of Shares”.
On the Initial Subscription Period, Shares in each Sub-fund will be offered at an Initial Price. The
Initial Price will be subject to the commissions detailed under Section 17 “Commissions and
Charges”. The Reference Currency of each Sub-fund is the currency in which the Net Asset Value
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of each Sub-fund is denominated, as specified for each Sub-fund in Appendix C. The Board of
Directors may however decide to calculate the Net Asset Value per Share of one or more
Sub-funds/Class(es) in addition to the Reference Currency in an Other Denomination Currency as
further detailed for the respective Sub-funds/Classes in Appendix C. The NAV calculated in an
Other Denomination Currency is the equivalent of the NAV in the Reference Currency of the
Sub-fund converted at the prevailing exchange rate.
5.
MANAGEMENT AND ADMINISTRATION
5.1
The Board of Directors
The Board of Directors is responsible for the Company’s management, control, administration and
the determination of its overall investment objectives and policies.
There are no existing or proposed service contracts between any of the directors and the Company,
although the directors are entitled to receive remuneration in accordance with usual market
practice.
Directors
The directors of the Company are Renato Mansur, Kenneth Casey and John Alldis. Mr Alldis of
Carne Global Financial Services Luxembourg is the COO of Carne operations in Luxembourg and
acts as an independent director and chairman to a number of fund boards and management
companies. He brings with him a strong management and operations background with over 30
years’ experience in the funds industry. Mr Mansur is the Head of Investment Products of Itaú
Unibanco S.A.. Mr Casey is the Chief Executive Officer of Itaú UK Asset Management Limited.
5.2
The Management Company
UBS Third Party Management Company S.A., a company incorporated as a société anonyme and
duly existing under the laws of the Grand Duchy of Luxembourg, is the management company to
the Company in accordance with the provisions of the 2010 Law.
UBS Third Party Management Company S.A., originally known as Schroeder Muenchmeyer
Hengst Investment Luxembourg SA until it changed name on 27 January 2006, was incorporated
in Luxembourg on 23 December 1993 as a public limited liability company for an indefinite
period and is subject to the provisions of chapter 15 of the 2010 Law. The Management Company
is registered with the Registrar under no. B 45 991. The Management Company is also acting as
management company for other Luxembourg domiciled undertakings for collective investment, a
list of which shall be disclosed in the financial reports of the Company.
The Management Company is, according to Management Company Services Agreement,
appointed to serve as the Company’s designated management company. The Management
Company shall in particular be responsible for the following duties:

Portfolio management of the Sub-funds;

Central administration, including inter alia, the calculation of the Net Asset Value, the
procedure of registration, conversion and redemption of the Shares and the general
administration of the Company;

Distribution of the Shares; in this respect the Management Company may with the
consent of the Company appoint other distributors/nominees as further outlined
here-below under Sub-section 5.6.
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The rights and duties of the Management Company are governed by the 2010 Law and the
Management Company Services Agreement entered into for an unlimited period of time.
In accordance with applicable laws and regulations and with the prior consent of the Board of
Directors, the Management Company is empowered to delegate, under its responsibility, all or part
of its duties and powers to any person or entity, which it may consider appropriate. It being
understood that the Prospectus shall the case being be amended accordingly.
For the time being the duties of portfolio management, central administrative agent, registrar and
transfer agent, domiciliary agent and distribution duties have been delegated as further detailed
here-below under Sub-sections 5.3. to 5.6.
5.3
The Investment Managers
Pursuant to an Investment Management Agreement, the Management Company has expressly
delegated to each Investment Manager the discretion, on a daily basis but subject to the overall
control and responsibility of the Management Company, to purchase and sell securities and
otherwise to manage the portfolios of the Sub-funds for the account and in the name of the
Company.
Each Investment Management Agreement may be terminated as specified in the relevant
agreement.
5.4
Central Administration
Pursuant to the Central Administration Agreement, the Company and the Management Company
have selected the Central Administration to act, in accordance with any applicable Luxembourg
laws, CSSF circulars or regulations, as the Company’s central administration agent, as the
Company’s domiciliary and corporate agent, as the Company’s registrar and transfer agent and as
the Company’s paying agent, to perform in Luxembourg certain administrative, domiciliary and
corporate, registration and transfer agency and paying agency duties in connection with the
business of the Company.
State Street Bank Luxembourg S.C.A. is a bank incorporated under the laws of Luxembourg,
R.C.S. B 32.771, having its registered office at 49, avenue J.F. Kennedy, L-1855 Luxembourg,
Grand Duchy Luxembourg. On 28 February 2014, its paid up share capital amounted to EUR
65,000,975.
State Street Bank Luxembourg S.C.A. is responsible for the procedure of registration, conversion
and redemption of the Shares, the calculation of the net asset value and the general administration
of the Company.
State Street Bank Luxembourg S.C.A. is inter alia responsible for the payment of dividends (if
any) to the Shareholders.
State Street Bank Luxembourg S.C.A. provides administrative and secretarial services to the
Company.
5.5
Global Distributor
Pursuant to the Global Distribution Agreement, Itaú UK Asset Management Limited has been
appointed as the Company’s global distributor.
Itaú UK Asset Management Limited is incorporated under the laws of the United Kingdom and
duly authorised under part 4A of the Financial Services and Markets Act 2000 and other
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applicable legislation to carry on its activities in the United Kingdom and subject to on-going and
effective supervision of the Financial Conduct Authority.
5.6
The Distributors
The Global Distributor may, in accordance with the terms of the Global Distribution Agreement,
decide to appoint Distributors. Certain Distributors may not offer all of the Sub-funds/Classes (if
any) of Shares to their investors.
A list of the Distributors is available at the Company’s registered office and will be updated on a
periodic basis.
5.7
The Custodian
State Street Bank Luxembourg S.C.A. has been appointed to act as Custodian on the basis of the
Custodian Agreement.
The Custodian has been entrusted with the custody of the Company’s assets and it shall fulfil the
obligations and duties provided for by the 2010 Law. In compliance with usual banking practices,
the Custodian may, under its responsibility, entrust part or all of the assets which are placed under
its custody to other banking institutions or financial intermediaries.
The Custodian shall also ensure that: a) the sale, issue, redemption, conversion and cancellation of
Shares, performed by or on behalf of the Company are carried out in accordance with the law and
the Articles of Incorporation; b) in transactions involving the assets of the Company, the
consideration is remitted to it within the usual time limits; c) the income of the Company is
allocated in accordance with the Articles of Incorporation.
6.
INVESTMENT OBJECTIVES AND POLICIES
The main objective of the Company is to seek capital appreciation by investing in a range of
diversified transferable securities and/or other liquid financial assets permitted by law through the
constitution of different professionally managed Sub-funds.
A Sub-fund may only invest in ADRs and/or GDRs the underlying of which complies with the
requirements set out in the section “Investment instruments” specified in Appendix A.
Each Sub-fund is managed in accordance with the investment powers and restrictions specified in
Appendix A and may use financial derivatives in accordance with the restrictions of Appendix A
or use the financial techniques and instruments specified in Appendix B.
The investment objective and policy of each Sub-fund is described in Appendix C.
7.
RISK FACTORS
7.1
General
Despite the possibility for the Company to use option, futures and swap contracts and to enter into
forward foreign exchange transactions with the aim to hedge exchange rate risks, all Sub-funds are
subject to market or currency fluctuations, and to the risks inherent in all investments. Therefore,
no assurance can be given that the invested capital will be preserved, or that capital appreciation
will occur.
- 16 -
7.2
Exchange Rates
The Reference Currency of each Sub-fund is not necessarily the investment currency of the
Sub-fund concerned. Investments are made in those currencies that best benefit the performance of
the Sub-funds in the view of the Investment Manager(s).
Changes in foreign currency exchange rates will affect the value of Shares held in the equity and
bond/ debt Sub-funds.
Shareholders investing in a Sub-fund other than in its Reference Currency should be aware that
exchange rate fluctuations could cause the value of their investment to diminish or increase.
7.3
Interest Rates
The value of fixed income securities held by the Sub-funds generally will vary inversely with
changes in interest rates and such variation may affect Share prices accordingly.
7.4
Equity Securities
The value of a Sub-fund that invests in equity securities will be affected by changes in the stock
markets and changes in the value of individual portfolio securities. At times, stock markets and
individual securities can be volatile and prices can change substantially in short periods of time.
The equity securities of smaller companies are more sensitive to these changes than those of larger
companies. This risk will affect the value of such Sub-funds, which will fluctuate as the value of
the underlying equity securities fluctuates.
7.5
Investments in other UCI and/or UCITS
The performance of a Sub-Fund will depend upon the performance of the investment strategies
pursued by the UCI/UCITS in which the Company invests. No guarantee or representation is made
that investment programs of the UCI/UCITS in which the Company invests will be successful, that
the UCI/UCITS in which the Company invests, the Sub-Funds or the Company will achieve any
targeted returns or that there will be any return on (or of) any amounts invested, and investment
results may vary substantially over time. In addition, investments made by the Sub-Funds in the
underlying funds which may include funds managed by the Portfolio Manager or by its affiliates,
are subject to costs and fees charged by the underlying funds, including but not limited to portfolio
management fees.
The value of an investment represented by a UCI/UCITS in which the Company invests, may be
affected by fluctuations in the currency of the country where such UCI/UCITS invests, or by
foreign exchange rules, the application of the various tax laws of the relevant countries, including
withholding taxes, government changes or variations of the monetary and economic policy of the
relevant countries. Furthermore, it is to be noted that the Net Asset Value per Share will fluctuate
mainly in light of the net asset value of the targeted UCIs/UCITS.
There shall be duplication of management fees and other operating fund related expenses, each
time the Company invests in other UCIs and/or UCITS. The maximum proportion of management
fees charged both to the Company itself and to the UCIs and/or UCITS in which the Company
invests shall be disclosed in the Annual Report.
7.6
Emerging Markets
Potential investors should note that investments in emerging markets carry risks additional to
those inherent in other investments. In particular, potential investors should note that investment
in any emerging market carries a higher risk than investment in a developed market; emerging
markets may afford a lower level of legal protection to investors; some countries may place
- 17 -
controls on foreign ownership; and some countries may apply accounting standards and auditing
practices which do not necessarily conform with internationally accepted accounting principles.
7.7
Options, Futures and Swaps
Each of the Sub-funds may use options, futures and swap contracts and enter into forward foreign
exchange transactions. The ability to use these strategies may be limited by market conditions and
regulatory limits and there can be no assurance that the objective sought to be attained from the use
of these strategies will be achieved. Participation in the options or futures markets, in swap
contracts and in foreign exchange transactions involves investment risks and transaction costs to
which the Sub-funds would not be subject if they did not use these strategies. If the Investment
Managers’ predictions of movements in the direction of the securities, foreign currency and
interest rate markets are inaccurate, the adverse consequences to a Sub-fund may leave the
Sub-fund in a less favourable position than if such strategies were not used.
Risks inherent in the use of options, foreign currency, swaps and futures contracts and options on
futures contracts include, but are not limited to (a) dependence on the Investment Managers’
ability to predict correctly movements in the direction of interest rates, securities prices and
currency markets; (b) imperfect correlation between the price of options and futures contracts and
options thereon and movements in the prices of the securities or currencies being hedged; (c) the
fact that skills needed to use these strategies are different from those needed to select portfolio
securities; (d) the possible absence of a liquid secondary market for any particular instrument at
any time; and (e) the possible inability of a Sub-fund to purchase or sell a portfolio security at a
time that otherwise would be favourable for it to do so, or the possible need for a Sub-fund to sell
a portfolio security at a disadvantageous time.
Where a Sub-fund enters into swap transactions it is exposed to a potential counterparty risk. In
case of insolvency or default of the swap counterparty, such event would affect the assets of the
Sub-fund.
7.8
Warrants
With regard to investment in warrants investors should note that the gearing effect of investment
in warrants and the volatility of warrant prices make the risk attached to the investment in warrants
higher than in the case with investment in equities.
Please see Appendix A of the Prospectus “Investment Powers and Restrictions” and Appendix B
of the Prospectus “Financial Techniques and Instruments” for more information.
7.9
Cross-Class Liability
The Classes within a Sub-fund are not separate legal entities. Thus all of the assets of a Sub-fund
are available to meet all the liabilities of such Sub-fund. In practice, cross-class liability will only
arise where any Class becomes insolvent and is unable to meet all its liabilities. In this case, all of
the assets of a Sub-fund may be applied to cover the liabilities of the insolvent Class.
7.10
Cross-Sub-Fund Liability
For the purpose of the relations between the Shareholders of different Sub-funds, each Sub-fund
will be deemed to be a separate entity with, but not limited to, its own contributions, redemptions,
capital gains, losses, charges and expenses. Thus, liabilities of an individual Sub-fund which
remain undischarged will neither attach to the Company as a whole, nor to other Sub-funds.
However, while Luxembourg law states that, unless otherwise provided for in the constituent
documentation of the Company, there is no cross-liability, there can be no assurance that such
provisions of Luxembourg law will be recognized and effective in other jurisdictions.
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7.11
U.S. Foreign Account Tax Compliance Act (“FATCA”)
Pursuant to FATCA, the Company (or each Sub-fund) will be required to comply (or be deemed
compliant) with extensive new reporting and withholding requirements designed to inform the
U.S. Department of the Treasury of U.S.-owned foreign investment accounts. Failure to comply
(or be deemed compliant) with these requirements will subject the Company (or each Sub-fund) to
U.S. withholding taxes on certain U.S.-sourced income and gains beginning in July 2014. Pursuant
to an intergovernmental agreement between the United States and Luxembourg, the Company (or
each Sub-fund) may be deemed compliant, and therefore not subject to the withholding tax, if it
identifies and reports U.S. taxpayer information directly to the Luxembourg government.
Investors may be requested to provide additional information to the Company to enable the
Company (or each Sub-fund) to satisfy these obligations. Failure to provide requested information
or, if applicable, satisfy its own FATCA obligations may subject an investor to liability for any
resulting U.S. withholding taxes, U.S. tax information reporting and/or mandatory redemption,
transfer or other termination of the investor’s interest in its Shares. Detailed guidance as to the
mechanics and scope of this new reporting and withholding regime is continuing to develop. There
can be no assurance as to the timing or impact of any such guidance on future operations of the
Company or its Sub-funds.
7.12
Fair value pricing
Fair value pricing adjustments may be made to the price of an underlying asset of a Sub-Fund, at
the absolute discretion of the Board of Directors. Fair value pricing adjustments may be necessary
where pricing or valuation information with respect to an asset is unavailable or unreliable due to
market dislocations, loss of pricing coverage or market-making activities by broker-dealers,
mergers and liquidations of broker-dealers or third-party pricing vendors that previously supplied
pricing data, extreme market volatility in certain asset classes, uncertainty surrounding potential or
actual government intervention in the markets for certain assets and other factors that the Board of
Directors determines may diminish the timeliness, accuracy or reliability of the most recent
market price or other pricing information. For example, the Board of Directors may determine that
a market price is unavailable or the last available price is unreliable if, among other reasons, the
price provided varies significantly from a recent trade, the security or asset is thinly traded, the
security does not have a readily available market price, recent asset sales represent distressed sales
prices not reflective of the price a market participant might reasonably expect to receive from the
current sale of that asset in an arm’s-length transaction, or there is a significant material event
subsequent to the most recent market quotation or pricing information. The Board of Director’s
good faith judgment as to whether an event would constitute a “significant material event” or
whether a valuation is unavailable or unreliable may, in hindsight, prove to be incorrect.
Accordingly, there is a risk that the fair value price of a security as determined by the Board of
Directors is not consistent with the subsequent opening or traded price of that security.
8.
FORM OF SHARES
All Shares are issued in uncertificated registered form (the share register is conclusive evidence of
ownership)
The Shares may only be issued in registered form and held in a settlement system represented by a
global note. In this case, the investors in Shares will directly or indirectly have their interests in the
Shares credited by book-entry in the accounts of the settlement system.
The Company treats the registered owner of a Share as the absolute and beneficial owner thereof.
Shares are freely transferable (with the exception that Shares may not be transferred to a
Prohibited Person or a US Person, as defined in Sub-section 11.1 “Subscription Procedure”) and
may be converted at any time for Shares of another Sub-fund within the same Class. For any
conversion of Shares, a conversion commission, as described under Section 17 “Commissions and
- 19 -
Charges”, may be charged. Upon issue, Shares are entitled to participate equally in the profits and
dividends of the Sub-fund attributable to the relevant Class in which the Shares have been issued,
as well as in the liquidation proceeds of such Sub-fund.
Shares do not carry any preferential or pre-emptive rights and each Share, irrespective of the Class
to which it belongs or its Net Asset Value, is entitled to one vote at all general meetings of
Shareholders. Fractions of Shares are not entitled to a vote, but are entitled to participate in the
liquidation proceeds. Shares are issued without par value and must be fully paid for subscription.
Upon the death of a Shareholder, the Board of Directors reserve the right to require the provision
of appropriate legal documentation in order to verify the rights of all and any successors in title to
Shares.
9.
ISSUE OF SHARES
In the absence of any specific instructions, Shares will be issued at the Net Asset Value per Share
of the relevant Class in the Reference Currency. Upon written instructions by the Shareholder,
Shares may also be issued in the Other Denomination Currency, if available.
Fractions of Shares to four decimal places will be issued, the Company being entitled to receive
the adjustment.
No Shares of any Class will be issued by the Company during any period in which the
determination of the Net Asset Value of the Shares of that Sub-fund is suspended by the Company,
as noted under Sub-section 18.3 “Temporary Suspension of Determination of Net Asset Value per
Share”.
The Board of Directors may decide that for a particular Sub-fund no further Shares will be issued
after the Initial Subscription Period as further specified for the respective Sub-fund in Appendix C.
10.
CLASSES OF SHARES
The Company may issue different Classes, as determined by the Board of Directors which may
differ inter alia in their fee structure and distribution policy applying to them. Certain Classes are
available to Retail Investors while other Classes may be available only to Institutional Investors as
such term are interpreted by the supervisory authority and any applicable laws and regulations
from time to time in Luxembourg.
The Classes for each Sub-fund are indicated in Appendix C.
The amounts invested in the various Classes of each Sub-fund are themselves invested in a
common underlying portfolio of investments. The Board of Directors may decide to create further
Classes with different characteristics (such as hedges classes, different charging structures,
different minimum amounts of investment or different currencies of denomination), and in such
cases, the Prospectus will be updated accordingly.
11.
SUBSCRIPTION FOR SHARES
11.1
Subscription Procedure
The Company may restrict or prevent the ownership of Shares by Prohibited Persons.
As the Company is not registered under the Securities Act, nor has the Company been registered
under the United States Investment Company Act of 1940, as amended, its Shares may not be
offered or sold, directly or indirectly, in the United States of America or its territories or
possessions or areas subject to its jurisdiction, or to US Persons. Accordingly, the Company may
- 20 -
require any subscriber to provide it with any information that it may consider necessary for the
purpose of deciding whether or not he is, or will be, a Prohibited Person or a US Person.
The Shares may not be offered, sold or distributed, directly or indirectly, in Canada or to or for the
benefit of any resident of Canada, other than in compliance with applicable securities laws. This
Prospectus will not be distributed or delivered in Canada other than in compliance with applicable
securities laws.
The Company retains the right to offer only one or several Classes for subscription in any
particular jurisdiction in order to conform to local law, custom, business practice or the
Company’s commercial objectives.
Subscription instructions accompany the Prospectus and may also be obtained from the Central
Administration or a Distributor.
An investor’s first subscription for Shares must be made in writing or by fax to the Central
Administration in Luxembourg or to a Distributor (if any) as indicated on the Subscription Form.
Subsequent subscriptions for Shares may be made in writing or by fax to the Central
Administration or a Distributor. The Company reserves the right to reject, in whole or in part, any
subscription without giving any reason therefore.
Joint subscribers must each sign the Subscription Form unless a power of attorney is provided
which is acceptable to the Company.
The minimum initial investment for each Class of each Sub-fund is specified in Appendix C. The
Board of Directors may, at its discretion, waive such minimum limits subject to the respect of the
principle of equal treatment of Shareholders.
Unless otherwise determined in Appendix C for a specific Sub-fund, subscriptions for Shares in
any Sub-fund received by the Central Administration on the Business Day preceding the
Valuation Day before the Sub-fund Subscription Deadline will be processed on that Valuation
Day using the Net Asset Value per Share determined on such Valuation Day based on the latest
available prices in Luxembourg (as described in Section 18 “Net Asset Value”).
Any subscriptions received by the Central Administration after the relevant Sub-fund Subscription
Deadline will be processed on the next Valuation Day on the basis of the Net Asset Value per
Share determined on such Valuation Day.
Different time limits may apply if subscriptions for Shares are made through a Distributor. No
Distributor is permitted to withhold subscription orders to personally benefit from a price change.
Investors should note that they might be unable to purchase or redeem Shares through a
Distributor on days that such Distributor is not open for business.
11.2
Payment Procedure
Unless otherwise determined in Appendix C for a specific Sub-fund, the Subscription Price must
be received by the Custodian no later than three Business Days following the applicable Valuation
Day (except specific payment procedure as detailed in Appendix C).
In the absence of specific instructions, the currency of payment for Shares of each Class will be the
Reference Currency. Upon written instructions by the Shareholder, the currency of payment for
Shares may also be the Other Denomination Currency, if available. In addition, a subscriber may
with the agreement of the Central Administration, effect payment in any other freely convertible
currency. The Central Administration will arrange for any necessary currency transaction to
convert the subscription monies from the currency of subscription into the Reference Currency or
the Other Denomination Currency (if available) of the relevant Sub-fund. Any such currency
- 21 -
transaction will be effected with the Custodian or a Distributor at the subscriber’s cost and risk.
Currency exchange transactions may delay any issue of Shares since the Central Administration
may choose at its option to delay executing any foreign exchange transaction until cleared funds
have been received.
Subscription instructions accompany the Prospectus and may also be obtained from the Central
Administration or a Distributor.
If timely payment for Shares is not made (or a completed Subscription Form is not received for an
initial subscription), the relevant issue of Shares may be cancelled, and a subscriber may be
required to compensate the Company and/or any relevant Distributor for any loss incurred in
relation to such cancellation.
11.3
Notification of Transaction
A confirmation statement will be sent to the subscriber (or his nominated agent if so requested by
the subscriber) by ordinary post as soon as reasonably practicable after the relevant Valuation Day,
providing full details of the transaction. Subscribers should always check this statement to ensure
that the transaction has been accurately recorded.
If any subscription is not accepted in whole or in part, the subscription monies or the balance
outstanding will be returned without delay to the subscriber by post or bank transfer at the
subscriber’s risk without any interest.
11.4
Rejection of Subscriptions
The Company may reject any subscription in whole or in part, in that case, the subscription monies
or the balance outstanding will be returned without delay to the subscriber by post or bank transfer
at the subscriber’s risk without any interest and the Board of Directors may, at any time and from
time to time and in its absolute discretion without liability and without notice, discontinue the
issue and sale of Shares of any Class in any one or more Sub-funds.
11.5
Money Laundering Prevention
Pursuant to the Luxembourg law of 12 November 2004 (as amended) relating to the fight against
money-laundering and the financing of terrorism and the Circulars of the CSSF, obligations have
been imposed inter alia on UCI as well as on professionals of the financial sector to prevent the
use of UCI for money laundering purposes. Within this context a procedure for the identification
of investors has been imposed. Namely, the Subscription Form of an investor must be
accompanied, in the case of individuals, by a certified copy of the subscriber’s passport or
identification card and, in the case of legal entities, by a certified copy of the subscriber’s articles
of incorporation and, where applicable, an extract from the commercial register or a copy of such
other documents as may be accepted as equivalent.
This identification procedure must be complied with by the Central Administration (or the
relevant competent agent of the Central Administration) in the case of direct subscriptions to the
Company, and in the case of subscriptions received by the Company from any intermediary
resident in a country that does not impose on such intermediary an obligation to identify investors
equivalent to that required under Luxembourg laws for the prevention of money laundering.
The Central Administration may request any such additional documents, as it deems necessary to
establish the identity of investors or beneficial owners.
Any information provided to the Company in this context is collected for anti-money laundering
compliance purposes only.
- 22 -
11.6
Data Protection
Shareholders are informed that their personal data or the information given in the subscription
documents or otherwise in connection with an application to subscribe for Shares, as well as
details of their shareholding, will be stored in digital form and processed in compliance with the
provisions of the Luxembourg law of 2 August 2002 on data protection, as amended.
Pursuant to articles 18 and 19 of the Luxembourg law of 2 August 2002 on data protection, as
amended, Shareholders are giving their express consents to the transfer, if applicable, of their data
to a third country, which may or may not ensure an adequate level of protection.
The personal data in relation to Shareholders is required to enable the Company, among others, to
fulfill the services required by Shareholders and to comply with its legal and regulatory
obligations.
Shareholders have a right of access and of rectification of the personal data in cases where such
data is incorrect or incomplete.
The personal data shall not be held for longer than necessary with regard to the purpose of the data
processing. The personal data shall be stored during the time required by law.
Shareholders should be aware that personal information given on the application or otherwise in
connection with an application to subscribe for Shares and details of their holding may be
disclosed to an Investment Manager and any other companies affiliated with the Investment
Manager when necessary, among others, for the purposes of providing services as well as
developing and processing the business relationship with Shareholders.
By investing in the Company, the Shareholders appoint each Investment Manager as its/their
attorney-in-fact to request from the Central Administration all necessary information pertaining to
investments by the Shareholder(s) in the Company, including personal data, among others, for the
purposes of the provision of services by the Investment Managers and instruct(s) the Central
Administration to comply with such requests from the Investment Managers to provide the latter
with this information.
The Shareholders’ personal data may be disclosed (i) to the Central Administration and any other
member of the State Street Group and other parties which intervene in the process of the business
relationship (e.g. external processing centers, dispatch or payment agents), including companies
based in countries where data protection laws might not exist or be of a lower standard than in the
European Union or (ii) when required by law or regulation (Luxembourg or otherwise).
12.
REDEMPTION OF SHARES
12.1
Procedure for Redemption
Shareholders wishing to have all or some of their Shares redeemed by the Company may apply to
do so by fax or by letter to the Central Administration or to a Distributor.
The application for redemption of any Shares must include:

either (i) the monetary amount the Shareholder wishes to redeem after deduction of any
applicable Redemption Commission; or (ii) the number of Shares the Shareholder wishes to
redeem, and

the Class and Sub-funds from which such Shares are to be redeemed.
- 23 -
In addition, the application of redemption should include the following, if applicable:

instructions on whether the Shareholder wishes to redeem its Shares at the Net Asset Value
denominated in the Reference Currency or, if available, in the Other Denomination Currency,
and

the currency in which the Shareholder wishes to receive its redemption proceeds.
In addition, the application for redemption must include the Shareholder’s personal details. Failure
to provide any of the aforementioned information may result in delay of such application for
redemption whilst verification is being sought from the Shareholder.
Applications for redemption must be duly signed by all registered Shareholders, save in the case of
joint registered Shareholders where an acceptable power of attorney has been provided to the
Company.
Unless otherwise determined in Appendix C for a specific Sub-fund, applications for redemption
from any Sub-fund received by the Central Administration on the Business Day preceding the
Valuation Day before the Sub-fund Redemption Deadline will be processed on that Valuation Day
using the Net Asset Value per Share determined on such Valuation Day based on the latest
available prices in Luxembourg (as described in Section 18 “Net Asset Value”). Any applications
for redemption received by the Central Administration after the Sub-fund Redemption Deadline
will be processed on the next Valuation Day on the basis of the Net Asset Value per Share
determined on such Valuation Day.
Different time limits may apply if applications for redemption are made to a Distributor. In such
cases, the Distributor will inform the Shareholder concerned of the redemption procedure relevant
thereto, together with any time limit by which the application for redemption must be received. No
Distributor is permitted to withhold redemption orders received to personally benefit from a price
change. Shareholders should note that they might be unable to redeem Shares through a
Distributor on days that such Distributor is not open for business.
12.2
Payment procedures
Unless otherwise determined in Appendix C for a specific Sub-fund, payment of the Redemption
Price will normally be effected three Business Days following the applicable Valuation Day
(except specific payment procedure as detailed in Appendix C) and will not be later than eight
Business Days after the relevant Valuation Day for all Sub-funds (except specific payment
procedure as detailed in Appendix C), provided that all the documents necessary to the redemption,
if any, have been received by the Company and unless legal constraints, such as foreign exchange
controls or restrictions on capital movements, or other circumstances beyond the control of the
Custodian, make it impossible or impracticable to transfer the redemption amount to the country in
which the application for redemption was submitted.
In the absence of any specific instructions, redemptions will be effected in the Reference Currency
of the relevant Sub-fund/Class. Shareholders may choose, in writing, at the time of giving the
redemption instructions to receive the redemption proceeds in an Other Denomination Currency,
if available, or (with the agreement of the Central Administration) in any other freely convertible
currency (the “Redemption Currency”). In the latter case, the Central Administration will
arrange the currency transaction required for conversion of the redemption monies from the
Reference Currency or Other Denomination Currency of the relevant Sub-fund/Class into the
relevant Redemption Currency. Such currency transaction will be effected with the Custodian or a
Distributor at the relevant Shareholder’s cost.
- 24 -
On payment of the Redemption Price, the corresponding Shares will be cancelled immediately in
the Company’s Share register. Any taxes, commissions and other fees incurred in the respective
countries in which the Shares are sold will be charged to the Shareholders.
12.3
Notification of transaction
A confirmation statement will be sent by ordinary post to the Shareholder detailing the redemption
proceeds due thereto as soon as reasonably practicable after determination of the Redemption
Price of the Shares being redeemed. Shareholders should check this statement to ensure that the
transaction has been accurately recorded. The redemption proceeds will be net of any applicable
Redemption Commission. In calculating the redemption proceeds, the Company will round down
to two decimal places, the Company being entitled to receive the adjustment.
In the event of an excessively large volume of applications for redemption, the Company may, in
accordance with Section 16 of the Prospectus, decide to delay execution of such applications until
the corresponding assets of the Company have been sold without unnecessary delay.
12.4
Compulsory Redemption
If the Company discovers at any time that Shares are owned by (i) a Prohibited Person, either
alone or in conjunction with any other person, whether directly or indirectly, or (ii) an investor
residing in a country in which the Board of Directors has decided not to offer the Shares for
subscription (as detailed in the Subscription Form), the Board of Directors may at its discretion
and without liability, compulsorily redeem the Shares at the Redemption Price in accordance with
article 8 of the Articles of Incorporation, and upon redemption, the Prohibited Person will cease to
be the owner of those Shares. The Company may require any Shareholder to provide it with any
information that it may consider necessary for the purpose of determining whether or not such
owner of Shares is or will be a Prohibited Person.
The Company may further cause Shares to be redeemed if such Shares are held by/or for the
account and/or on behalf of (i) a person that does not provide the necessary information requested
by the Company in order to comply with legal and regulatory rules such as but not limited to the
FATCA provisions or (ii) a person who is deemed to cause potential financial risk for the
Company.
13.
CONVERSION OF SHARES
13.1
Conversion procedure
Shareholders may convert all or part of their Shares of any Class in any Sub-fund (the “Original
Sub-fund”) into Shares of another Class in the same Sub-fund or into Shares of the same Class or
another Class of another existing Sub-fund provided that the Shareholders fulfils the criteria of the
relevant Class and Sub-fund into which conversion is requested. Conversion requests will be sent
in writing or by fax to the Central Administration or to a Distributor, and will state which Shares
are to be converted into which Sub-funds.
The application for conversion must include either the monetary amount the Shareholder wishes to
convert or the number of Shares the Shareholder wishes to convert. In addition, the application for
conversion must include the Shareholder’s personal details.
The application for conversion must be duly signed by the registered Shareholder, save in the case
of joint registered Shareholders where an acceptable power of attorney has been provided to the
Company.
Failure to provide any of this information may result in delay of the application for conversion.
- 25 -
Applications for conversion between any Sub-funds received by the Central Administration on a
Business Day preceding the Valuation Day before the Sub-fund Conversion Deadline, will be
processed on that Valuation Day using the Net Asset Value per Share determined on such
Valuation Day based on the latest available prices in Luxembourg (as described in Section 18 “Net
Asset Value”).
Different time limits may apply if applications for conversion are made to a Distributor. In such
cases, the Distributor will inform the Shareholder of the conversion procedure relevant to that
Shareholder, together with any time limit by which the application must be received. Shareholders
should note that they might be unable to convert Shares through a Distributor on days that such
Distributor is not open for business.
Any applications for conversion received by the Central Administration or a Distributor after the
Sub-fund Conversion Deadline on a Business Day preceding the Valuation Day, or on any day
preceding the Valuation Day that is not a Business Day, will be processed on the next Valuation
Day on the basis of the Net Asset Value per Share determined on such Valuation Day.
The above described conversion procedure for the conversion of Shares of a Sub-fund into Shares
of the same Class of one or more other Sub-funds is applicable mutatis mutandis for the
conversion of Shares of a Class (the “Original Class”) of a Sub-fund (the “Original Sub-fund”)
into Shares of another Class (the “New Class”) of the same or another Sub-fund (the “New
Sub-fund”).
The rate at which all or part of the Shares in respectively an Original Sub-fund or an Original Class
are converted into Shares in a New Sub-fund or in a New Class is determined in accordance with
the following formula:
A = (B x C x D) x (1 - E)
F
where:
13.2
A
is the number of Shares to be allocated respectively in the New Sub-fund or in the New
Class;
B
is the number of Shares of respectively the Original Sub-fund or the Original Class to be
converted;
C
is the Net Asset Value per Share of the Original Class or the relevant Class of respectively
the Original Sub-fund determined on the relevant Valuation Day;
D
is the actual rate of foreign exchange on the day concerned in respect of the Reference
Currency of respectively the Original Sub-fund, or the Original Class and the Reference
Currency of respectively the New Sub-fund or the New Class, and is equal to 1 in relation to
conversions between Sub-funds denominated in the same Reference Currency;
E
is the Conversion Commission percentage payable per Share; and
F
is the Net Asset Value per Share of the relevant Class of the New Sub-fund, or the New Class
determined on the relevant Valuation Day, plus any taxes, commissions or other fees.
Notification of Transaction
Following such conversion of Shares, the Company will inform the Shareholder in question of the
number of Shares of the New Sub-fund or of the New Class obtained by conversion and the price
- 26 -
thereof. Fractions of Shares in the New Sub-fund or in the New Class to four decimal places will
be issued, the Company being entitled to receive the adjustment.
14.
TEMPORARY SUSPENSION
CONVERSIONS
OF
SUBSCRIPTIONS,
REDEMPTIONS
AND
No Shares will be issued by the Company and the right of any Shareholder to require the
redemption or conversion of its Shares will be suspended during any period in which the
determination of the Net Asset Value of the relevant Sub-fund is suspended by the Company
pursuant to the powers contained in the Articles of Incorporation and as discussed in Sub-section
18.3 “Temporary Suspension of Determination of Net Asset Value per Share”.
Notice of suspension will be given to subscribers and to any Shareholder tendering Shares for
redemption or conversion. Withdrawal of a subscription or of an application for redemption or
conversion will only be effective if written notification by letter or by fax is received by the
Central Administration before termination of the period of suspension, failing which subscription,
redemption and conversion applications not withdrawn will be processed on the first Valuation
Day following the end of the suspension period, on the basis of the Net Asset Value per Share
determined on such Valuation Day.
15.
LATE TRADING AND MARKET TIMING
15.1
Late Trading
The Company determines the price of its Shares on a forward basis. This means that it is not
possible to know in advance the Net Asset Value per Share at which Shares will be bought or sold
(exclusive of any Subscription or Redemption Commission as defined hereafter). Subscription
applications have to be received and will be accepted for each Sub-fund only in accordance with
the Sub-fund Subscription Deadline.
15.2
Market Timing
The Company is not designed for investors with short-term investment horizons. Activities which
may adversely affect the interests of the Shareholders (for example that disrupt investment
strategies or impact expenses) such as market timing or the use of the Company as an excessive or
short-term trading vehicle are not permitted.
While recognising that Shareholders may have legitimate needs to adjust their investments from
time to time, the Board of Directors in its discretion may, if it deems such activities adversely
affect the interests of the Company or the Shareholders, take action as appropriate to deter such
activities.
Accordingly if the Board of Directors determines or suspects that a Shareholder has engaged in
such activities, it may suspend, cancel, reject or otherwise deal with that Shareholder’s
subscription or conversion applications and take any action or measures as appropriate or
necessary to protect the Company and the Shareholders.
16.
PROCEDURES FOR SUBSCRIPTIONS, REDEMPTIONS AND CONVERSIONS
REPRESENTING 10% OR MORE OF THE NET ASSETS OF ANY SUB-FUND
If the Board of Directors determines that it would be detrimental to the existing Shareholders to
accept a subscription for Shares of any Sub-fund that represents more than 10% of the net assets of
such Sub-fund, then they may postpone the acceptance of such subscription and, in consultation
with the incoming Shareholder, may require him to stagger his proposed subscription over an
agreed period of time.
- 27 -
If any application for redemption or conversion is received in respect of any one Valuation Day,
which either singly or when aggregated with other such applications so received, represents more
than 10% of the net assets of any one Sub-fund, the Company reserves the right, in its sole and
absolute discretion and without liability (and in the reasonable opinion of the Board of Directors
that to do so is in the best interests of the remaining Shareholders), to scale down pro rata each
application with respect to such Valuation Day so that not more than 10% of the net assets of the
relevant Sub-fund be redeemed or converted on such Valuation Day.
To the extent that any application for redemption or conversion is not given full effect on such
Valuation Day by virtue of the exercise by the Company of its power to pro-rate applications, such
application shall be treated with respect to the unsatisfied balance thereof as if a further request
had been made by the Shareholder in question in respect of the next Valuation Day and, if
necessary, subsequent Valuation Days, until such application shall have been satisfied in full.
With respect to any application for redemption or conversion received in respect of such Valuation
Day, to the extent that subsequent applications shall be received in respect of following Valuation
Days, such later applications shall be postponed in priority to the satisfaction of applications
relating to such first Valuation Day, but subject thereto shall be dealt with as set out above.
17.
COMMISSIONS AND CHARGES
17.1
Subscription commission
The Subscription Price during the Initial Subscription Period will be equal to the Initial Price, plus
any applicable Subscription Commission in favour of any Distributor or any other beneficiary as
set out for the relevant Sub-fund in Appendix C. Thereafter, the Subscription Price of each Class
of each Sub-fund will be equal to the Net Asset Value per Share (as described under Sub-section
11.1 “Subscription Procedure”), plus any applicable Subscription Commission in favour of any
Distributor or any other beneficiary as set out for the relevant Sub-fund in Appendix C. The
balance of the subscription payment, after deduction of the applicable Subscription Commission,
will be applied to the purchase of Shares.
Any taxes, commissions and other fees incurred in the respective countries in which Company
Shares are sold will also be charged, if any, to the Shareholders.
17.2
Redemption commission
Holdings of Shares of any Class may be redeemed in whole or in part on the Business Day
preceding the Valuation Day at the Redemption Price on the basis of the Net Asset Value per
Share determined on such Valuation Day less any applicable Redemption Commission of up to
2% of the Net Asset Value per Share. Such Redemption Commission may be charged in favour of
any Distributor where specifically provided in Appendix C.
In addition and where specifically provided in Appendix C for a specific Sub-fund, a Redemption
Commission may be charged in favour of the relevant Sub-fund. Such Redemption Commission
may, under certain circumstances and subject to the principle of equal treatment between investors,
be waived by the Board of Directors for all Shareholders redeeming their Shares on the same
Valuation Day.
17.3
Conversion commission
For the conversion, a Conversion Commission of up to 2% of the Net Asset Value per Share of the
Class of the Sub-fund in which the conversion shall be made may be charged in favour of any
Distributor where specifically provided in Appendix C. This charge (if any) shall be automatically
deducted when the number of Shares in the New Sub-fund is calculated.
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The above mentioned conversion commission is applicable mutatis mutandis to the conversion of
Shares in the Original Class of a Sub-fund into Shares in the New Class of the same Sub-fund.
17.4
Company Charges
17.4.1
Fees payable to the Management Company
The Management Company is entitled to receive Management Company Fees according
to the rate described below and as fully detailed in the Appendix 2 to the Management
Company Services Agreement which shall be calculated on the net assets of the
Company with a minimum annual fixed fee of EUR 15,000 per Sub-fund. The
Management Company Fee will be reduced to a minimum of EUR 7,500 per annum per
Sub-fund for the first 12 months of the relationship:
EUR 0 - EUR 500mn: 5bps
> EUR 500mn – EUR 1,000mn: 4bps
> EUR 1,000mn – EUR 1,500mn: 3bps
> EUR 1,500mn – EUR 3,000mn: 2.5bps
> EUR 3,000mn: 2bps
Out-of-pocket expenses of the Management Company will be charged at costs in addition
to the foregoing.
17.4.2
Fees payable to the Investment Managers
The Investment Managers are entitled to receive Investment Management Fees, as
detailed in Appendix C out of the assets of the Sub-funds, pursuant to the relevant
Investment Management Agreement.
17.4.3
Fees payable to the Custodian
The Custodian is entitled to receive Custody Fees, as detailed in Appendix C out of the
assets of the Sub-funds, pursuant to the Custodian Agreement and in accordance with
usual market practice. Notwithstanding such fees, the Custodian will receive customary
banking fees for transactions. The fees payable to the Custodian do not include the fees to
be paid to the correspondents of the Custodian and shall be calculated on the net assets of
the Sub-funds.
17.4.4
Fees payable to the Central Administration
The Central Administration is entitled to receive Central Administration Fees, as detailed
in Appendix C out of the assets of the Sub-funds, pursuant to the relevant central
administration agreement in accordance with usual market practice. The Central
Administration Fee shall be calculated on the net assets of the Sub-funds. Further,
additional transaction and maintenance fees for transfer agency services may be levied by
the Central Administration.
17.4.5
Fees payable to the Global Distributor
The Global Distributor is entitled to receive a distribution fee, as detailed in Appendix C
out of the assets of the Sub-funds. The fee of the Global Distributor will be calculated
daily and paid quarterly.
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17.4.6
Other fees
In addition to the above, the following fees and expenses shall be borne by the Company,
respectively the different Sub-funds:
 All taxes levied on the assets and the income of the Company (in particular, but
not limited to, the “taxe d’abonnement” and any stamp duties payable), fees for
legal and auditing services, costs of any proposed listings and of maintaining
such listings, promotion, printing, reporting and publishing expenses (including
reasonable marketing and advertising expenses) of prospectuses, addenda,
explanatory memoranda, registration statements, global note if any, annual
reports and semi-annual reports, all reasonable out-of-pocket expenses of the
directors, all taxes levied on the assets, registration fees and other expenses
payable to governmental and supervisory authorities in any relevant jurisdictions,
insurance costs, costs of extraordinary measures carried out in the interests of
Shareholders (in particular, but not limited to, arranging expert opinions and
dealing with legal proceedings) and all other operating expenses, including fees
payable to trustees, fiduciaries, correspondent banks and local paying agents and
any other agents employed by the Company, the cost of buying and selling assets,
customary transaction fees and commissions charged by custodian banks or their
agents (including free payments and receipts and any reasonable out-of-pocket
expenses, i.e. stamp taxes, registration costs, scrip fees, special transportation
costs, etc.), fees relating to the use of any electronic reporting system, customary
brokerage fees and commissions charged by banks and brokers for securities
transactions and similar transactions, in case of guaranteed or structured
Sub-funds, fees charged by a guarantor or derivative counterparty, interest and
postage, telephone, facsimile and telex charges;
 The remuneration of the paying agents;
 The remuneration of domiciliary agents;
 Fees relating to the calculation of the total expense ratio (if applicable).
17.4.7 Miscellaneous
Unless otherwise provided in Appendix C for a specific Sub-fund, all fees are calculated
and accrued on each Valuation Day and are payable monthly in arrears.
Costs and expenses will be borne by the Sub-fund to which they are attributable. Costs
and expenses that are not attributable to a particular Sub-fund, will be borne by the
Company pro rata to the net assets of each Sub-fund in accordance with the Articles of
Incorporation. For the avoidance of doubt, each new Sub-fund will bear the fees relating
to its launching.
18.
NET ASSET VALUE
18.1
Definition
The Net Asset Value per Share of each Class shall be determined each Valuation Day, (except if
another frequency for the valuation is indicated for a particular Sub-fund in Appendix C). The
Directors may also decide not to consider as Business Day other days on which banks are
otherwise open for business in Luxembourg.
The Net Asset Value per Share of each Class in each Sub-fund will be expressed in the Reference
Currency of the Sub-fund. The Board of Directors may however decide to calculate the Net Asset
- 30 -
Value per Share for certain Sub-funds/Classes in the Other Denomination Currency as further
detailed for the respective Sub-funds/Classes in Appendix C. The NAV calculated in the Other
Denomination Currency is the equivalent of the NAV in the Reference Currency of the Sub-fund
converted at the prevailing exchange rate. The Sub-funds are valued daily and the Net Asset Value
per Share of each Class in each Sub-fund is determined on each Valuation Day in Luxembourg.
The Net Asset Value per Share of each Class in each Sub-fund on any Valuation Day is
determined by dividing the value of the total assets of that Sub-fund properly allocable to such
Class less the liabilities of such Sub-fund properly allocable to such Class by the total number of
Shares of such Class outstanding on such Valuation Day.
The Subscription Price and the Redemption Price of the different Classes will differ within each
Sub-fund as a result of the differing fee structure and/or distribution policy for each Class.
The valuation of the Net Asset Value per Share of each Class in each Sub-fund shall be made in the
following manner:
The assets of the Company shall be deemed to include:
(i)
all cash on hand or on deposit, including any interest accrued thereon;
(ii)
all bills and demand notes payable and accounts receivable (including proceeds of
securities sold but not delivered);
(iii)
all bonds, time notes, certificates of deposit, shares, stock, debentures, debenture stocks,
subscription rights, warrants, options and other securities, financial instruments and
similar assets owned or contracted for by the Company (provided that the Company may
make adjustments in a manner not inconsistent with paragraph (a) below with regards to
fluctuations in the market value of securities caused by trading ex-dividends, ex-rights, or
by similar practices);
(iv)
all stock dividends, cash dividends and cash distributions receivable by the Company to
the extent information thereon is reasonably available to the Company;
(v)
all interest accrued on any interest bearing assets owned by the Company except to the
extent that the same is included or reflected in the principal amount of such asset;
(vi)
the preliminary expenses of the Company, including the cost of issuing and distributing
Shares, insofar as the same have not been written off;
(vii)
the liquidating value of all forward contracts, swaps and all call or put options the
Company has an open position in;
(viii)
all other assets of any kind and nature including expenses paid in advance.
The value of such assets shall be determined as follows:
(i)
the value of any cash on hand or on deposit, bills and demand notes and accounts
receivable, prepaid expenses, cash dividends and interest declared or accrued and not yet
received, is deemed to be the full amount thereof, unless in any case the same is unlikely
to be paid or received in full, in which case the value thereof is arrived at after making
such discount as may be considered appropriate in such case to reflect the true value
thereof;
(ii)
the value of financial assets listed or dealt in on a Regulated Market or on any other
regulated market will be valued at their latest available prices, or, in the event that there
- 31 -
should be several such markets, on the basis of their latest available prices on the main
market for the relevant asset;
(iii)
in the event that the assets are not listed or dealt in on a Regulated Market or on any other
regulated market or if, in the opinion of the Board of Directors, the latest available price
does not truly reflect the fair market value of the relevant asset, the value of such asset
will be defined by the Board of Directors based on the reasonably foreseeable sales
proceeds determined prudently and in good faith by the Board of Directors;
(iv)
the liquidating value of futures, forward or options contracts not dealt in on Regulated
Markets or on other regulated markets shall mean their net liquidating value determined,
pursuant to the policies established by the Board of Directors, on a basis consistently
applied for each different variety of contracts. The liquidating value of futures, forward
or options contracts dealt in on Regulated Markets or on other regulated markets shall be
based upon the last available settlement prices of these contracts on Regulated Markets
and other regulated markets on which the particular futures, forward or options contracts
are dealt in by the Company; provided that if a futures, forward or options contract could
not be liquidated on the day with respect to which net assets are being determined, the
basis for determining the liquidating value of such contract shall be such value as the
Board of Directors may deem fair and reasonable;
(v)
the Net Asset Value per Share of any Sub-fund may be determined by using an amortised
cost method for all investments with a known short term maturity date. This involves
valuing an investment at its cost and thereafter assuming a constant amortisation to
maturity of any discount or premium, regardless of the impact of fluctuating interest rates
on the market value of the investments. While this method provides certainty in
valuation, it may result in periods during which value, as determined by amortisation
cost, is higher or lower than the price such Sub-fund would receive if it sold the
investment. The Board of Directors will continually assess this method of valuation and
recommend changes, where necessary, to ensure that the relevant Sub-fund’s
investments will be valued at their fair value as determined in good faith by the Board of
Directors. If the Board of Directors believes that a deviation from the amortised cost per
share may result in material dilution or other unfair results to Shareholders, the Board of
Directors shall take such corrective action, if any, as they deem appropriate to eliminate
or reduce, to the extent reasonably practicable, the dilution or unfair results. The relevant
Sub-fund shall, in principle, keep in its portfolio the investments determined by the
amortisation cost method until their respective maturity date;
(vi)
interest rate swaps will be valued at their market value established by reference to the
applicable interest rates curve. Index and financial instruments related swaps will be
valued at their market value established by reference to the applicable index or financial
instrument. The valuation of the index or financial instrument related swap agreement
shall be based upon the market value of such swap transaction established in good faith
pursuant to procedures established by the Board of Directors;
(vii)
all other assets will be valued at fair market value as determined in good faith pursuant to
procedures established by the Board of Directors;
(viii)
the Board of Directors, in its discretion, may permit some other method of valuation to be
used if it considers that such valuation better reflects the fair value of any asset of the
Company.
The liabilities of the Company shall be deemed to include:
(i)
all loans, bills and accounts payable;
- 32 -
(ii)
all accrued interest on loans of the Company (including accrued fees for commitment for
such loans);
(iii)
all accrued or payable administrative expenses (including the Investment Management
Fees and any other third party fees);
(iv)
all known liabilities, present and future, including all matured contractual obligations for
payment of money or property, including the amount of any unpaid dividends declared
by the Company;
(v)
an appropriate provision for future taxes based on capital and income to the relevant
Valuation Day, as determined from time to time by the Company, and other reserves, if
any, authorized and approved by the Board of Directors; and
(vi)
all other liabilities of the Company of whatsoever kind and nature except liabilities
represented by Shares. In determining the amount of such liabilities, the Company shall
take into account all expenses payable and all costs incurred by the Company, which
shall comprise the Investment Management Fee, fees payable to its directors (including
all reasonable out-of-pocket expenses), the Management Company, investment advisors
(if any), investment or sub-investment managers, accountants, the custodian bank, the
administrative agent, corporate agents, domiciliary agents, paying agents, registrars,
transfer agents, permanent representatives in places of registration, distributors, trustees,
fiduciaries, correspondent banks and any other agent employed by the Company, fees for
legal and auditing services, costs of any proposed listings and of maintaining such
listings, promotion, printing, reporting and publishing expenses (including reasonable
marketing and advertising expenses and costs of preparing, translating and printing in
different languages) of prospectuses, addenda, explanatory memoranda, registration
statements, annual reports and semi-annual reports, all taxes levied on the assets and the
income of the Company (in particular, the “taxe d’abonnement” and any stamp duties
payable), registration fees and other expenses payable to governmental and supervisory
authorities in any relevant jurisdictions, insurance costs, costs of extraordinary measures
carried out in the interests of Shareholders (in particular, but not limited to, arranging
expert opinions and dealing with legal proceedings) and all other operating expenses,
including the cost of buying and selling assets, customary transaction fees and
commissions charged by custodian banks or their agents (including free payments and
receipts and any reasonable out-of-pocket expenses, i.e. stamp taxes, registration costs,
scrip fees, special transportation costs, etc.), customary brokerage fees and commissions
charged by banks and brokers for securities transactions and similar transactions, interest
and postage, telephone, facsimile and telex charges. The Company may calculate
administrative and other expenses of a regular or recurring nature on an estimated figure
for yearly or other periods in advance, and may accrue the same in equal proportions over
any such period.
The net assets of the Company are at any time equal to the total of the net assets of the
various Sub-funds.
In determining the Net Asset Value per Share, income and expenditure are treated as
accruing daily.
18.2
Swing pricing
Under certain circumstances (for example, large volumes of deals) investment and/or
disinvestment costs may have an adverse effect on the Shareholders’ interests in a Sub-fund. In
order to prevent this effect, called “dilution”, the Board of Directors has the authority to allow for
the Net Asset Value per Share to be adjusted by effective dealing and other costs and fiscal
charges which would be payable on the effective acquisition or disposal of assets in the relevant
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Sub-fund if the net capital activity exceeds, as a consequence of the sum of all subscriptions,
redemptions or conversions in such a Sub-fund, such threshold percentage as may be determined
from time to time by the Board of Directors, of the Sub-fund’s total net assets on a given
Valuation Day.
18.3
Temporary Suspension of Determination of Net Asset Value per Share
The Company may suspend the determination of the Net Asset Value per Share of one or more
Sub-funds and the issue, redemption and conversion of any Classes in the following
circumstances:
(i)
during any period when any of the principal stock exchanges or other markets on which a
substantial portion of the investments of the Company attributable to such Sub-fund from
time to time is quoted or dealt in is closed otherwise than for ordinary holidays, or during
which dealings therein are restricted or suspended, provided that such restriction or
suspension affects the valuation of the investments of the Company attributable to such
Sub-fund quoted thereon;
(ii)
during the existence of any state of affairs which constitutes an emergency in the opinion
of the Board of Directors as a result of which disposal or valuation of assets owned by the
Company attributable to such Sub-fund would be impracticable;
(iii)
during any breakdown in the means of communication or computation normally
employed in determining the price or value of any of the investments of such Sub-fund or
the current price or value on any stock exchange or other market in respect of the assets
attributable to such Sub-fund;
(iv)
during any period when the Company is unable to repatriate funds for the purpose of
making payments on the redemption of Shares of such Sub-fund or during which any
transfer of funds involved in the realization or acquisition of investments or payments
due on redemption of Shares cannot, in the opinion of the Board of Directors, be effected
at normal rates of exchange;
(v)
when for any other reason the prices of any investments owned by the Company
attributable to such Sub-fund cannot promptly or accurately be ascertained; or
(vi)
upon the publication of a notice convening a general meeting of Shareholders for the
purpose of winding-up the Company, any Sub-funds, or merging the Company or any
Sub-funds, or informing the Shareholders of the decision of the Board of Directors to
terminate Sub-funds or to merge Sub-funds.
The suspension of a Sub-fund shall have no effect on the determination of the Net Asset Value per
Share or on the issue, redemption and conversion of Shares of any other Sub-fund that is not
suspended.
Any request for subscription, redemption or conversion shall be irrevocable except in the event of
a suspension of the determination of the Net Asset Value per Share.
Notice of the beginning and of the end of any period of suspension will be published in a
Luxembourg daily newspaper and in any other newspaper(s) selected by the Board of Directors, as
well as in the official publications specified for the respective countries in which Company Shares
are sold. The Luxembourg regulatory authority, and the relevant authorities of any member states
of the European Union in which Shares are marketed, will be informed of any such suspension.
Notice will likewise be given to any subscriber or Shareholder as the case may be applying for
subscription, conversion or redemption of Shares in the Sub-fund(s) concerned.
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19.
TAXATION - APPLICABLE LAW
The following section is a short summary of certain important taxation principles that may be or
become relevant with respect to the Company and its Sub-funds.
This section does not purport to be a complete summary of tax law and practice currently
applicable in Luxembourg and does not contain any statement with respect to the tax treatment of
an investment in the Company or any of its Sub-funds in any other jurisdiction.
Furthermore, this section does not address the taxation of the Company or any of its Sub-funds in
any other jurisdiction or the taxation of any legal entity, partnership or UCI without legal
personality in which the Company or any of its Sub-funds hold an interest.
Prospective investors are advised to consult their own professional tax advisers in respect of the
possible tax consequences of subscribing for, buying, holding, redeeming, converting or selling
Shares under the laws of their country of citizenship, residence, domicile or incorporation.
The following summary is based on laws, regulations and practice currently applicable in the
Grand Duchy of Luxembourg at the date of the Prospectus and is subject to changes therein,
possibly with retroactive effect.
19.1
The Company
Under present Luxembourg law and administrative practice, neither the Company nor any of its
Sub-funds is liable for any Luxembourg corporate income tax, municipal business tax, and net
worth tax. The Company (or each Sub-fund) is however in principle liable in Luxembourg to a
subscription tax of 0.05% per annum computed on its net assets, such tax being payable quarterly
on the basis of the value of the aggregate assets of the Company (or its Sub-funds) at the end of the
relevant calendar quarter.
The rate of the subscription tax is 0.01% per annum of the Net Asset Value for:
(a) Sub-funds whose sole object is the collective investment in money market instruments
and the placing of deposits with credit institutions,
(b) Sub-funds whose sole object is the collective investment in deposits with credit
institutions and
(c) Sub-funds or Classes which are reserved to one or more Institutional Investors.
A Sub-fund that satisfies the following conditions is exempt from the annual subscription tax:
(i) the securities issued by the Sub-fund are reserved to Institutional Investors, and
(ii) the sole object of the Sub-fund is the collective investment in money market instruments
and the placing of deposits with credit institutions, and
(iii) the weighted residual portfolio maturity of the Sub-fund does not exceed 90 days, and
(iv) the Sub-fund has obtained the highest possible rating from a recognised rating agency.
The value of assets represented by units and shares held in other UCIs is however exempt from
subscription tax provided such units or shares have already been subject to this tax. No other stamp
duty or other tax is payable in Luxembourg on the issue of shares by the Company.
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Dividends and interest, if any, received by a the Company or any of its Sub-funds from
investments may be subject to taxes and/or withholding taxes in the countries concerned at varying
rates, such (withholding) taxes usually not being recoverable. The Company and its Sub-funds
may be liable to certain other foreign taxes.
19.2
Shareholders
At the date of the Prospectus, Shareholders are not subject to any taxation on capital gains,
taxation on income, transfer tax or withholding tax in Luxembourg on the holding, sale, purchase
or repurchase of Shares (exceptions may apply mainly to Shareholders who are domiciled,
resident, have a permanent establishment, a permanent representative or a fixed base of business in
Luxembourg).
The information set forth above is based on present law and administrative practice and may be
subject to modification.
Prospective investors should inform themselves of, and where appropriate take advice on, the laws
and regulations (such as those relating to taxation, foreign exchange controls and being prohibited
persons) applicable to the subscription, purchase, holding, and redemption of shares in the country
of their citizenship, residence or domicile, and of the current tax status of the Company in
Luxembourg.
19.3
EU Savings Directive
The Council of the European Union adopted on 3 June 2003 the EU Savings Directive. Under the
EU Savings Directive, EU Member States are required to provide tax authorities of another EU
Member State with details of payments of interest or other similar income paid by a person within
its jurisdiction to an individual resident in that other EU Member State.
The Grand Duchy of Luxembourg has decided to amend the 2005 Law and to end as from 1
January 2015 the transitional period foreseen in the EU Savings Directive where account holders
could opt between the exchange of information and the withholding tax to introduce automatic
exchange of information on interest payments made by a paying agent established in Luxembourg.
According to article 8 of the EU Savings Directive, the paying agent will report to the
Luxembourg tax authorities the following information regarding the beneficial owner of the
payment:
-
Identity and residence of the beneficial owner;
-
Name and address of the paying agent;
-
Account number of the beneficial owner or where there is none, identification of the debt
claim giving rise to the interest;
-
The total amount of interest or similar income or sales price or repurchase price or
repayment price.
The Luxembourg tax authorities will automatically transmit these information to the competent
authority of the EU Member State where the recipient is established. The communication of
information shall be automatic and shall take place at least once a year within six months
following the end of the tax year of the EU Member State of the paying agent, for all interest
payments made during that year. The first exchange of information will take place in 2016
regarding payments made in 2015.
The foregoing is only a summary of the implications of the EU Savings Directive and the
2005 Law, is based on the current interpretation thereof and does not purport to be
- 36 -
complete in all respects. It does not constitute investment or tax advice and investors should
therefore seek advice from their financial or tax adviser on the full implications for
themselves of the EU Savings Directive and the 2005 Law.
19.4
Applicable law
The Luxembourg District Court is the place of performance for all legal disputes between the
Shareholders and the Company. Luxembourg law applies. However, the Company may submit
itself to the jurisdiction of countries in which Shares are offered and sold in the light of claims
lodged by Shareholders from those countries. The English version of the Prospectus is the
authoritative version and shall prevail in the event of any inconsistency with any translation hereof.
However the Company may consider as binding the authorised translation of the prospectus in the
language of the countries where shares are offered and sold.
Statements made in the Prospectus are based on the laws and practice in force at the date of the
Prospectus in the Grand Duchy of Luxembourg, and are subject to changes in those laws and
practice.
19.5
U.S. Foreign Account Tax Compliance Act (“FATCA”)
Pursuant to FATCA, the Company (or each Sub-fund thereof) will be subject to U.S. federal
withholding taxes (at a 30% rate) on payments of certain amounts made to such entity after 30
June 2014 (“withholdable payments”), unless it complies (or is deemed compliant) with extensive
reporting and withholding requirements. Withholdable payments generally will include interest
(including original issue discount), dividends, rents, annuities, and other fixed or determinable
annual or periodical gains, profits or income, if such payments are derived from U.S. sources, as
well as gross proceeds from dispositions of securities that could produce U.S. source interest or
dividends. Income which is effectively connected with the conduct of a U.S. trade or business is
not, however, included in this definition. To avoid the withholding tax, unless deemed compliant,
the Company (or each Sub-fund thereof) will be required to enter into an agreement with the
United States to identify and disclose identifying and financial information about each U.S.
taxpayer (or foreign entity with substantial U.S. ownership or U.S.. controlling persons) which
invests in the Company (or Sub-fund), and to withhold tax (at a 30% rate) on withholdable
payments and related payments made to any investor which fails to furnish information requested
by the Company to satisfy its obligations (or those of its Sub-funds) under the agreement. Pursuant
to an intergovernmental agreement between the United States and Luxembourg, the Company (or
each Sub-fund) may be deemed compliant, and therefore not subject to the withholding tax, if it
identifies and reports U.S. taxpayer information directly to the Luxembourg government. Certain
categories of U.S. investors, generally including, but not limited to, tax-exempt investors, publicly
traded corporations, banks, regulated investment companies, real estate investment trusts,
common trust funds, brokers, dealers and middlemen, and state and federal governmental entities,
will be exempt from such reporting. Detailed guidance as to the mechanics and scope of this new
reporting and withholding regime is continuing to develop. There can be no assurance as to the
timing or impact of any such guidance on future Company (or Sub-fund) operations.
Shareholders will be required to provide certifications as to their U.S. or non-U.S. tax status,
together with such additional tax information as the Company (or a Sub-fund) or its agents may
from time to time request. Failure to furnish requested information or, if applicable, satisfy its own
FATCA obligations may subject a Shareholder to liability for any resulting withholding taxes, U.S.
tax information reporting and mandatory redemption of such Shareholder’s Shares. While the
Company will make all reasonable efforts to seek documentation from Shareholders to comply
with these rules and to allocate any taxes imposed or required to be deducted under these
provisions to Shareholders whose non-compliance caused the imposition or deduction of the tax, it
is unclear at this time whether other complying Shareholders may be affected by the presence of
such non-complying Shareholders.
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All prospective investors and Shareholders should consult with their own tax advisors regarding
the possible implications of FATCA on their investment in the Company.
19.6 Investors’ Reliance on U.S. Federal Tax Advice in this Prospectus
The discussion contained in this Prospectus as to U.S. federal tax considerations is not intended or
written to be used, and cannot be used, for the purpose of avoiding penalties. Such discussion is
written to support the promotion or marketing of the transactions or matters addressed herein.
Each taxpayer should seek U.S. federal tax advice based on the taxpayer’s particular
circumstances from an independent tax advisor.
20.
GENERAL MEETINGS AND REPORTS
20.1
General Meetings
The annual general meeting of Shareholders will be held at the registered office of the Company
on the 20 April each year (unless such date falls on a legal bank holiday in Luxembourg, in which
case on the next bank business day in Luxembourg) at 11:00 a.m. CET. Notices of all general
meetings are sent by mail to all registered Shareholders at their registered address in accordance
with Luxembourg law. Such notice will indicate the time and place of such meeting and the
conditions of admission thereto, will contain the agenda and will refer to the requirements of
Luxembourg law with regard to the necessary quorum and majorities at such meeting. To the
extent required by Luxembourg law, further notices will be published in the Mémorial and in one
Luxembourg newspaper.
20.2
Annual and Semi-annual Reports
Unless otherwise provided for in the convening notice to the annual general meeting of
Shareholders, the audited Annual Reports will be available at the registered office of the Company
(and as may be required by applicable local laws and regulations). Audited Annual Reports and
unaudited Semi-annual Reports will be made available for public inspection at each of the
registered offices of the Company, the Central Administration and any Distributor respectively.
The Company’s financial year ends on 31 December of each year.
The consolidation currency of the Company is USD.
21.
RISK MANAGEMENT
The Company employs a risk-management process which enables it to monitor and measure at any
time the risk of the positions and their contribution to the overall risk profile of the Sub-funds and
it employs a process allowing for accurate and independent assessment of the value of OTC
derivative instruments. The Company must furthermore communicate to the supervisory authority
regularly and in accordance with the rules the supervisory authority shall define, the types of
derivatives instruments, the underlying risks, the quantitative limits and the methods which are
chosen in order to estimate the risks associated with derivative instrument transactions.
In accordance with ESMA Guidelines 10-788 and CSSF Circular 11/512, the Board of Directors
will determine for each Sub-fund, as specified in Appendix C, the global exposure determination
methodology, the expected level of leverage (in case the VaR approach is applied) and/or the
reference portfolio (in case the relative VaR is applied).
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22.
TERM, LIQUIDATION, MERGER AND DIVISION LIQUIDATION - TERMINATION
AND AMALGAMATION OF SUB-FUNDS
22.1
Term
22.1.1 The Company
The Company was established for an unlimited period of time.
22.1.2 The Sub-funds
Unless otherwise provided for in the relevant Appendix, each Sub-fund will be set up for a
continuous and unlimited term of years.
22.2
Liquidation
22.2.1 The Company
The Company may at any time be dissolved by a resolution taken by the general meeting of
Shareholders subject to the quorum and majority requirements as defined in the Articles of
Incorporation.
Whenever the capital falls below two thirds of the minimum capital as provided by the 2010 Law,
the Board of Directors must submit the question of the dissolution of the Company to the general
meeting of Shareholders. The general meeting, for which no quorum shall be required, shall
decide on simple majority of the votes of the Shares present and represented at the meeting.
The question of the dissolution of the Company shall also be referred to the general meeting of
Shareholders whenever the capital falls below one quarter of the minimum capital. In such event,
the general meeting shall be held without quorum requirements, and the dissolution may be
decided by the Shareholders holding one quarter of the votes present and represented at that
meeting.
The meeting must be convened so that it is held within a period of 40 days from when it is
ascertained that the net assets of the Company have fallen below two thirds or one quarter of the
legal minimum as the case may be.
The issue of new Shares by the Company shall cease on the date of publication of the notice of the
general meeting of Shareholders, to which the dissolution and liquidation of the Company shall be
proposed. One or more liquidators shall be appointed by the general meeting of Shareholders to
realize the assets of the Company, subject to the supervision of the relevant supervisory authority
in the best interests of the Shareholders. The proceeds of the liquidation of each Sub-fund, net of
all liquidation expenses, shall be distributed by the liquidators among the holders of Shares in each
Class in accordance with their respective rights.
The completion of the liquidation of the Company must in principle take place within a period of
nine months from the date of the decision relating to the liquidation. Where the liquidation of the
Company cannot be fully completed within a period of nine months, a written request for
exemption shall be submitted to the CSSF detailing the reasons why the liquidation cannot be
completed.
As soon as the closure of the liquidation of the Company has been decided, whether this decision
is taken before the nine-month period has expired or at a later date, any residual funds not claimed
by Shareholders prior to the completion of the liquidation shall be deposited as soon as possible at
the Caisse de Consignation.
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22.2.2 A Sub-fund and/or Class
In the event that for any reason the value of the total net assets in any Sub-fund or Class has
decreased to, or has not reached, an amount determined by the Board of Directors to be the
minimum level for such Sub-fund and/or Class, to be operated in an economically efficient
manner or in case of a substantial modification in the political, economic or monetary situation
relating to such Sub-fund and/or Class which would have potential material adverse consequences
on the investments of the Sub-fund and/or Class or as a matter of economic rationalization, the
Board of Directors may decide to compulsory redeem all the Shares of the relevant Sub-fund
and/or Class at the Net Asset Value per Share (taking into account actual realization prices of
investments and realization expenses) as calculated on the Valuation Day at which such decision
shall take effect.
The Company shall serve a notice to the holders of the relevant Sub-fund and/or Class prior to the
effective date for the compulsory redemption, which will indicate the reasons for, and the
procedure of, the redemption operations: registered holders shall be notified in writing.
Unless it is otherwise decided in the interests of, or to keep equal treatment between, the
Shareholders, the Shareholders of the Sub-fund and/or Class concerned may continue to request
redemption or conversion of their Shares free of charge (but taking into account actual realization
prices of investments and realization expenses) prior to the date effective for the compulsory
redemption.
Any request for subscription shall be suspended as from the moment of the decision by the
competent body of the Company with regard to the termination, the amalgamation or the transfer
of the relevant Sub-fund and/or Class.
In addition, the general meeting of Shareholders of any Sub-fund or Class may, upon proposal
from the Board of Directors, resolve to redeem all the Shares of the relevant Sub-fund and/or Class
and refund to the Shareholders the Net Asset Value of their Shares (taking into account actual
realization prices of investments and realization expenses) calculated on the Valuation Day at
which such decision shall take effect. There shall be no quorum requirements for such general
meeting of Shareholders which shall decide by resolution taken by simple majority of the Shares
present or represented at such meeting.
All redeemed Shares shall be cancelled by the Company.
The completion of the liquidation of a Sub-fund or Class must in principle take place within a
period of nine months from the date of decision of the Board of Directors relating to the
liquidation. Where the liquidation of Sub-fund or Class cannot be fully completed within a period
of nine months, a written request for exemption shall be submitted to the CSSF detailing the
reasons why the liquidation cannot be completed.
As soon as the closure of the liquidation of Sub-fund or a Class has been decided, whether this
decision is taken before the nine-month period has expired or at a later date, any residual funds not
claimed by Shareholders prior to the completion of the liquidation shall be deposited as soon as
possible at the Caisse de Consignation.
22.3
Merger
22.3.1 The Company
The Company may be merged in accordance with the provisions of the Law of 2010. In the event
the Company is involved in a merger as receiving UCITS, solely the Board of Directors will
decide on the merger and the effective date thereof; in the event the Company is involved in a
merger as absorbed UCITS and hence ceases to exist, the general meeting of shareholders of the
- 40 -
Company has to approve and decide on the effective date of such merger by a resolution adopted
with no quorum requirement and at the simple majority of the votes validly cast at such meeting.
Any applicable contingent deferred sales charges are not to be considered as redemption charges
and shall therefore be due.
22.3.2 The Sub-funds
The Board of Directors may resolve to proceed with a merger (within the meaning of the Law of
2010) of any Sub-fund, either as receiving or absorbed Sub-fund, with (i) another existing
Sub-fund within the Company or another sub-fund within another Luxembourg or foreign UCITS;
or (ii) a new Luxembourg or foreign UCITS, and as appropriate, to redesignate the shares of the
Sub-fund concerned as shares of the new Sub-fund or of the new UCITS as applicable. Any
applicable contingent deferred sales charges are not to be considered as redemption charges and
shall therefore be due.
22.3.3 Classes
A Class may merge with one or more other Classes by resolution of the Board of Directors if the
Net Asset Value of a Class is below an amount determined by the Board of Directors to be the
minimum level for such Class, to be operated in an economically efficient manner or in the event
of special circumstances beyond its control, such as political, economic, or military emergencies,
or if the Board of Directors should conclude, in light of prevailing market or other conditions,
including conditions that may adversely affect the ability of a Class to operate in an economically
efficient manner, and with due regard to the best interests of Shareholders, that a Class should be
merged. This decision will be notified to Shareholders as required. Each Shareholder of the
relevant Class will be given the option, within a period to be determined by the Board of Directors
(but not being less than one month, unless otherwise authorised by the regulatory authorities, and
specified in said notice), to request free of any redemption charge either the repurchase of its
Shares or the exchange of its Shares against Shares of any Class not concerned by the merger.
A Class may be contributed to another investment fund by resolution of the Board of Directors in
the event of special circumstances beyond its control, such as political, economic, or military
emergencies, or if the Board of Directors should conclude, in light of prevailing market or other
conditions, including conditions that may adversely affect the ability of a Class to operate in an
economically efficient manner, and with due regard to the best interests of Shareholders, that a
Class should be contributed to another fund. This decision will be notified to Shareholders as
required. Each Shareholder of the relevant Class will be given the option within a period to be
determined by the Board of Directors (but not being less than one month, unless otherwise
authorised by the regulatory authorities, and specified in said notice), to request, free of any
redemption charge, the repurchase of its Shares. Where the holding of units in another undertaking
for collective investment does not confer voting rights, the contribution will be binding only on
Shareholders of the relevant Class who expressly agree to the merger. Any applicable contingent
deferred sales charges are not to be considered as redemption charges and shall therefore be due.
22.4
Division
If the Board of Directors determines that it is in the interests of the Shareholders of the relevant
Sub-fund or Class or that a change in the economic or political situation relating to the Sub-fund or
Class concerned has occurred which would justify it, the reorganisation of one Sub-fund or Class,
by means of a division into two or more Sub-funds or Classes, may take place. This decision will
be notified to Shareholders as required. The notification will also contain information about the
two or more new Sub-funds or Classes. The notification will be made at least one month before the
date on which the reorganization becomes effective in order to enable the Shareholders to request
the sale of their Shares, free of charge, before the operation involving division into two or more
Sub-funds or Classes becomes effective.
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23.
INFORMATION AVAILABLE TO THE PUBLIC
23.1
Documents Available for Inspection
The following documents may be inspected free of charge during usual business hours on any
week day (Saturday and public holidays excepted) at the registered office of the Company:
 the Prospectus;
 the KIIDs;
 the Articles of Incorporation;
 the Management Company Services Agreement;
 the Central Administration Agreement;
 the Custodian Agreement;
 the Global Distribution Agreement; and
 the Investment Management Agreements.
Copies of the Prospectus, of the KIIDs, of the Articles of Incorporation and of the latest published
Annual Report and Semi-annual Report may be obtained without cost at the same address and on
www.ubs.com/third-party-man-co-policies.
23.2
Publication of Net Asset Value per Share
The Net Asset Value per Share of each Class in each Sub-fund is made public at the registered
office of the Company and is available at the offices of the Custodian. The Company will arrange
for the publication of this information in the Reference Currency or an Other Denomination
Currency, if any in leading financial newspapers. The Company cannot accept any responsibility
for any error or delay in publication or for non-publication of prices.
23.3
Historical Performance
If available, past performance information will be included in the KIIDs, which are available from
the registered office of the Company.
24.
DIVIDEND POLICY
Whether accumulation or distribution Classes have been issued in relation to a particular Sub-fund
is indicated in Appendix C.
Each year the general meeting of Shareholders will decide, based on a proposal from the Board of
Directors, for each Sub-fund and for distribution Classes on the use of the Company’s net income.
Over and above the distributions mentioned in the preceding paragraph, the Board of Directors
may decide the payment of interim dividends in the form and under the conditions as provided by
law.
Part or all of the net income and realized and unrealized capital gains may be distributed provided
that after the distribution the net assets of the Company total more than EUR 1,250,000.
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The part of the year’s net income that has been decided to be distributed in relation of the
distribution Classes will be distributed to the holders of the distribution Shares in cash.
The part of the year’s net income corresponding to accumulation Classes will be capitalised in the
relevant Sub-fund for the benefit of the accumulation Class.
Dividends will be declared in the Reference Currency of each Sub-fund but, for the convenience of
Shareholders, payment may be made in a currency chosen by the investor. The exchange rates
used to calculate payments will be determined by the Central Administration by reference to
normal banking rates. Such currency transaction will be effected with the Custodian at the relevant
Shareholder’s cost. In the absence of written instructions, dividends will be paid in the Reference
Currency of the Sub-fund.
Dividends remaining unclaimed for five years after their declaration will be forfeited and revert to
the relevant Sub-fund/Class.
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APPENDIX A
INVESTMENT POWERS AND RESTRICTIONS
In order to achieve the Company’s investment objectives and policies, the Board of Directors has
determined that the following investment powers and restrictions shall apply to all investments by
the Company:
Investment instruments
1)
The Company, in each Sub-fund, may only invest in:
(a)
transferable securities and money market instruments admitted to or dealt in on a regulated
market, as defined in Article 4 point 1 (14) of the Directive 2004/39/EC of the European
Parliament and of the Council of 21 April 2004;
(b)
transferable securities and money market instruments dealt in on another regulated market in
an EU Member State which operates regularly and is recognised and open to the public;
(c)
transferable securities and money market instruments admitted to official listing on a stock
exchange in a non-EU Member State or dealt in on another regulated market in a non-EU
Member State, which operates regularly and is recognised and open to the public located
within any other country of Europe, Asia Oceania, the American continent or Africa;
(d)
recently issued transferable securities and money market instruments, provided that the
terms of issue include an undertaking that application will be made for admission to official
listing on a stock exchange or to another regulated market referred to under paragraphs (a) to
(c) above and that such admission is secured within one year of issue;
(e)
shares or units of UCITS authorised according to the UCITS Directive and/or other UCIs
within the meaning of the first and second indent of Article 1(2) of the UCITS Directive,
should they be situated in a EU member state or not, provided that:
(f)
i.
such other UCI are authorised under laws which provide that they are subject to
supervision considered by the CSSF to be equivalent to that laid down in Community
law, and that cooperation between authorities is sufficiently ensured;
ii.
the level of guaranteed protection for unit-holders in such other UCI is equivalent to
that provided for unit-holders in a UCITS, and in particular that the rules on asset
segregation, borrowing, lending, and uncovered sales of transferable securities and
money market instruments are equivalent to the requirements of the UCITS Directive;
iii.
the business of the other UCI is reported in half-yearly and annual reports to enable an
assessment to be made of the assets and liabilities, income and operations over the
reporting period;
iv.
no more than 10% of the UCITS or the other UCI assets, whose acquisition is
contemplated, can be, according to its fund rules or instruments of incorporation,
invested in aggregate in units of other UCITS or other UCIs;
deposits with credit institutions which are repayable on demand or have the right to be
withdrawn, and maturing in no more than twelve (12) months, provided that the credit
institution has its registered office in a EU Member State or, if the registered office of the
credit institution is situated in a non EU Member State, provided that it is subject to
prudential rules considered by the CSSF as equivalent to those laid down in Community law;
- 44 -
(g)
financial derivative instruments, including equivalent cash-settled instruments, dealt in on a
regulated market referred to in paragraphs (a), (b) and (c); and/or financial derivative
instruments dealt in over-the-counter (“OTC derivatives”), provided that:
i.
the underlying consists of instruments covered by paragraphs (a) to (h), financial
indices, interest rates, foreign exchange rates or currencies, in which the Company
may invest according to the investment objectives of its Sub-funds;
ii.
the counter-parties to OTC derivative transactions are institutions subject to
prudential supervision, and belonging to the categories approved by the CSSF; and
iii.
the OTC derivatives are subject to reliable and verifiable valuation on each Valuation
Day and can be sold, liquidated or closed by an offsetting transaction at any time at
their fair market value at the Company’ s initiative;
(h)
2)
money market instruments other than those dealt in on a regulated market and referred to in
paragraphs (a) to (c) above, if the issue or issuer of such instruments is itself regulated for the
purpose of protecting investors and savings, and provided that they are:
i.
issued or guaranteed by a central, regional or local authority, a central bank of a EU
Member State, the European Central Bank, the European Union or the European
Investment Bank, a non-EU Member State or, in the case of a Federal State, by one of
the members making up the federation, or by a public international body to which one
or more EU Member States belong; or
ii.
issued by an undertaking any securities of which are dealt in on regulated markets
referred to in paragraphs (a), (b) or (c); or
iii.
issued or guaranteed by an establishment subject to prudential supervision, in
accordance with criteria defined by Community law or by an establishment which is
subject to and comply with prudential rules considered by the CSSF to be at least as
stringent as those laid down by Community law; or
iv.
issued by other bodies belonging to the categories approved by the CSSF provided
that investments in such instruments are subject to investor protection equivalent to
that laid down in the first, the second or the third indent of this paragraph (h) and
provided that the issuer is a company whose capital and reserves amount at least to ten
million Euros (EUR 10,000,000.-) and which presents and publishes its annual
accounts in accordance with Fourth Directive 78/660/EEC, is an entity which, within
a group of companies which includes one or several listed companies, is dedicated to
the financing of the group or is an entity which is dedicated to the financing of
securitisation vehicles which benefit from a banking liquidity line.
However, the Company:
(a)
may invest up to 10% of the net assets of a Sub-fund in transferable securities and money
market instruments other than those referred to in section 1) above;
(b)
may acquire movable and immovable property which is essential for the direct pursuit of its
business;
(c)
may not acquire either precious metals or certificates representing them; and
(d)
may hold ancillary liquid assets.
- 45 -
Risk diversification
3)
In accordance with the principle of risk diversification, each Sub-fund will invest no more than
10% of its net assets in transferable securities or money market instruments issued by the same
body. Each Sub-fund may not invest more than 20% of its assets in deposits made with the same
body.
4)
The risk exposure to a counterparty of each Sub-fund in an OTC derivative transaction may not
exceed 10% of its assets when the counterparty is a credit institution referred to in section 1)(f)
above, or 5% of its assets in any other case.
5)
Moreover, the total value of the transferable securities and money market instruments held by the
Sub-fund in the issuing bodies in each of which it invests more than 5% of its assets must not
exceed 40% of the value of its assets. This limitation does not apply to deposits and OTC derivative
transactions made with financial institutions subject to prudential supervision.
6)
Notwithstanding the limits laid down in sections 3) and 4) above, the Sub-fund may not combine:
i.
investments in transferable securities or money market instruments issued by a;
ii.
deposits made with a; and/or
iii.
exposures arising from OTC derivatives transactions undertaken with a
single body in excess of 20% of its assets.
7)
The following exceptions can be made:
(a)
The aforementioned limit of 10% can be raised to a maximum of 25% for certain debt
securities if they are issued by credit institution whose registered office is situated in an EU
Member State and which is subject, by virtue of law, to particular public supervision for the
purpose of protecting the holders of such debt securities. In particular, the amounts resulting
from the issue of such debt securities must be invested, pursuant to the law in assets which
sufficiently cover, during the whole period of validity of such debt securities, the liabilities
arising there from and which are assigned to the preferential repayment of capital and
accrued interest in the case of default by the issue. If the Sub-fund invests more than 5% of
its net assets in such debt securities as referred to above and issued by the same issuer, the
total value of such investments may not exceed 80% of the value of the Sub-fund’s net
assets.
(b)
The aforementioned limit of 10% can be raised to a maximum of 35% for transferable
securities or money market instruments issued or guaranteed by an EU Member State, by its
local authorities, by a non EU Member State or by public international bodies of which one
or more EU Member States are members.
(c)
The transferable securities and money market instruments referred to in exceptions (a) and
(b) are not included in the calculation of the limit of 40% laid down in section 5) above.
(d)
The limits stated under sections 3) to 6) and 7)(a) and (b) above, may not be combined and,
accordingly, investments in transferable securities or money market instruments issued by
the same body or in deposits or derivatives instruments made with this body in accordance
with sections 3) to 6) and 7)(a) and (b) above, may not, in any event, exceed a total of 35% of
the Sub-fund’s net assets.
(e)
Companies which are included in the same group for the purposes of consolidated accounts,
as defined in accordance with Directive 83/349/EEC or in accordance with recognised
international accounting rules are regarded as a single body for the purpose of calculating the
limits contained in sections 3) to 7).
- 46 -
(f)
Each Sub-fund may invest in aggregate up to 20% of its assets in transferable securities and
money market instruments with the same group.
(g)
Without prejudice to the limits laid down in paragraph 12 below, the limit of 10% laid down
in paragraphs 3 to 7 is raised to a maximum of 20% for investment in equity and or debt
securities issued by the same body when the aim of the investment policy of the Company is
to replicate the composition of a certain equity or debt securities index which is recognised
by the CSSF, on the following basis:

the composition of the index is sufficiently diversified,

the index represents an adequate benchmark for the market to which it refers,

it is published in an appropriate manner.
This limit is 35% where that proves to be justified by exceptional market conditions in
particular in regulated markets where certain transferable securities or money market
instruments are highly dominant. The investment up to this limit is only permitted for a
single issuer.
8)
When a transferable security or money market instrument embeds a derivative, the latter must be
taken into account when complying with the requirements of the above-mentioned restrictions.
9)
The Company may further invest up to 100% of the net assets of any Sub-fund, in
accordance with the principle of risk spreading, in transferable securities and money market
instruments issued or guaranteed by an EU Member State, its local authorities, by another
member State of the OECD, or public international bodies of which one or more EU Member
State are members, provided that in such event the Sub-fund must hold securities from at
least six different issues, and that securities from any one issue do not account for more than
30% of the Sub-fund’s net assets.
10)
Each Sub-fund has 6 months from its date of authorization to achieve compliance with sections 3)
to 9) and 10).
(a)
Each Sub-fund may acquire shares or units of UCITS and/or other UCIs referred to under
section 1) (e), provided that no more than 20% of its assets are invested in a single UCITS or
other UCI.
(b)
For the purposes of applying this investment limit, each Sub-fund of a UCI with multiple
sub-funds, within the meaning of Article 181 of the 2010 Law, shall be considered as a
separate entity, provided that the principle of segregation of commitments of the different
Sub-funds is ensured in relation to third parties.
(c)
Investments made in shares or units of UCI other than UCITS may not exceed, in aggregate,
30% of the assets of the relevant Sub-fund.
(d)
When the Sub-fund has acquired shares or units of UCITS and/or other UCIs, the assets of
the respective UCITS or other UCI do not have to be combined in the view of the limits laid
down in sections 3) to 7) (a) to (f).
(e)
When the Sub-fund invests in the shares or units of other UCITS and/or other UCIs that are
managed, directly or by delegation, by the same management company or by any other
company to which the management company is linked by common management or control
or by a substantial direct or indirect holding, that management company or other company
may not charge any management fee nor any subscription or redemption fees on account of
the UCITS’ investment in the units of other UCITS and/or other UCI.
- 47 -
(f)
If a Sub-Fund invests a substantial proportion of its assets in UCITS and other UCIs, the
maximum management fee (excluding any performance fee, if any) charged both to such
Sub-Fund and the UCITS and/or Other UCIs concerned shall be specified for such Sub-fund
in Appendix C. The Fund will indicate in its annual report the maximum proportion of
management fees charged both to the relevant Sub-Fund and to the UCITS and Other UCIs
in which such Sub-Fund has invested during the relevant period.
11)
The Company will not acquire any shares carrying voting rights which would enable it to exercise
significant influence over the management of an issuing body.
12)
The Company may not acquire more than:

10% of non-voting shares of the same issuer;

10% of the debt securities issued by the same issuer;

25% of the units of the same UCITS and/or other UCI; or

10% of the money market instruments of the same issuer.
The limits laid down in the second, third and fourth indents may be disregarded at the time of
acquisition if at that time the gross amount of debt securities or money market instruments, or the
net amount of the securities in issue, cannot be calculated.
13)
14)
The limits of sections 11) and 12) above are waived as to:
(a)
transferable securities and money market instruments issued or guaranteed by an EU
Member State or its local authorities;
(b)
transferable securities and money market instruments issued or guaranteed by a non-EU
Member State;
(c)
transferable securities and money market instruments issued by public international bodies
of which one or more EU Member States are members;
(d)
shares held in the capital of a company incorporated in a non-EU Member State and
investing its assets mainly in securities of issuers having their registered office in that State,
if under the legislation of that State such a holding represents the only way in which the
Sub-fund can invest in the securities of the issuers of that State. This derogation only applies
if the company has an investment policy complying with sections 3) to 7) (a) to (f) as well as
sections 10) to 12) above. If the limits stated in sections 3) to 7) (a) to (f) and 10) above are
exceeded, the provisions laid down in 9) and 17) shall apply mutatis mutandis;
(e)
shares held by the Sub-funds in the capital of one or more subsidiary companies carrying on
only the business of management, advice or marketing in the country/state where the
subsidiary is located, in regard to the repurchase of units at Shareholders’ request
exclusively on its or their behalf.
Any Sub-fund may not borrow more than 10% of its total net assets, and then only from financial
institutions and on a temporary basis. Each Sub-fund may, however, acquire foreign currency by
means of a back to back loan. Each Sub-fund will not purchase securities while borrowings are
outstanding in relation to it, except to fulfil prior commitments and/or exercise subscription rights.
However, each Sub-fund can borrow up to 10% of its net assets to make possible the acquisition of
immovable property essential for the direct pursuit of its business. In this case, these borrowings
and those referred to above (temporary borrowings) may not in any case in total exceed 15% of the
Sub-funds’ net assets.
- 48 -
14)
The Company may not grant credits or act as guarantor for third parties. This limitation does not
prevent the Company to purchase securities that are not fully paid up, nor to lend securities as
further described thereunder. This limitation does not apply to margin payments on option deals
and other similar transactions made in conformity with established market practices.
15)
Each Sub-fund will not purchase any securities on margin (except that the Sub-fund may obtain
such short-term credit as may be necessary for the clearance of purchases and sales of securities) or
make short sales of securities or maintain a short position. Deposits on other accounts in connection
with option, forward or financial futures contracts, are, however, permitted within the limits
provided for here below.
16)
The Board of Directors of the Company is authorised to introduce further investment restrictions at
any time in the interests of the Shareholders provided these are necessary to ensure compliance
with the laws and regulations of those countries in which the Company’s shares are offered and
sold. In this event this Prospectus will be updated.
17)
If any of the above limitations are exceeded for reasons beyond the control of the Company and/or
each Sub-fund or as a result of the exercise of subscription rights attaching to transferable securities
or money market instruments, the Company and/or each Sub-fund must adopt, as a priority
objective, sales transactions for the remedying of that situation, taking due account of the interests
of its Shareholders.
18)
A Sub-fund may, under the conditions set out under article 181 (8) of the Law of 2010, subscribe,
acquire and/or hold shares to be issued or issued by one or more other Sub-funds without the
Company being subject to the requirements of the law of 10 August 1915 on commercial
companies, as amended, with respect to the subscription, acquisition and/or the holding of its own
shares.
- 49 -
APPENDIX B
FINANCIAL TECHNIQUES AND INSTRUMENTS
(A)
General provisions
For the purpose of efficient portfolio management and/or to protect its assets and commitments,
the Company may arrange for each Sub-fund to make use of techniques and instruments relating to
transferable securities and money market instruments.
The techniques and instruments referred to in this paragraph include, among others, the purchase
and sale of call and put options and the purchase and sale of future contracts or the entering into
swaps relating to foreign exchange rates, currencies, securities, indices, interest rates or other
admissible financial instruments. The Sub-funds shall use instruments dealt in on a regulated
market referred to under a), b) and c) of section 1 of Appendix A above or dealt in
over-the-counter (in accordance with the conditions set out in Appendix A). In general, when these
transactions involve the use of derivatives, the conditions and restrictions set out in Appendix A
must be complied with.
In no case whatsoever must recourse to transactions involving derivatives or other financial
techniques and instruments cause the Company to depart from the investment objectives set out in
the Prospectus.
(B)
Efficient portfolio management
The reference to techniques and instruments in this Prospectus which relate to transferable
securities and which are used for the purpose of efficient portfolio management shall be
understood as a reference to techniques and instruments which fulfil the following criteria:
a) they are economically appropriate in that they are realised in a cost-effective way;
b) they are entered into for one or more of the following specific aims:
i)
reduction of risk;
ii) reduction of cost;
iii) generation of additional capital or income for the Company with a level of risk which
is consistent with the risk profile of the Company and the risk diversification rules set
forth under items 3), 4), 5) 6), 7) (a) to (f) under the heading “Risk diversification” of
Appendix A;
c) their risks are adequately captured by the risk management process of the Company.
Techniques and instruments which comply with the criteria set out in the paragraph above and
which relate to money market instruments shall be regarded as techniques and instruments relating
to money market instruments for the purpose of efficient portfolio management.
There will be no direct and indirect operational costs/fees arising from efficient portfolio
management techniques that may be deducted from the revenue delivered to the Company.
It is not expected that conflicts of interest may arise when using techniques and instruments for the
purpose of efficient portfolio management.
(C)
Securities lending and repurchase transactions
In addition to the techniques and instruments referred to under paragraph A above, the Company
may, for each Sub-fund, for the purpose of efficient portfolio management and/or for hedging
purpose, engage in securities lending transactions, sales with a right of repurchase transactions
and/or reverse repurchase transactions/repurchase transactions subject to the provisions set forth
in CSSF Circular 08/356, CSSF Circular 14/592 and ESMA 2014/937.
- 50 -
(D)
Management of Collateral
Where the Company enters into OTC financial derivative transactions and efficient portfolio
management techniques, collateral used to reduce counterparty risk exposure may take the form
of:
(i) liquid assets, which include not only cash and short term bank certificates, but also money
market instruments as defined in Directive 2007/16/EC of 19 March 2007. A letter of credit or a
guarantee at first-demand given by a first class credit institution not affiliated to the counterparty
are considered as equivalent to liquid assets,
(ii) bonds issued or guaranteed by a member state of the OECD or by their local public authorities
or by supranational institutions and undertakings with EU, regional or world-wide scope,
(iii) shares or units issued by money market undertakings for collective investment calculating a
daily net asset value and being assigned a rating of AAA or its equivalent,
(iv) shares or units issued by UCITS investing mainly in bonds/shares mentioned in (v) and (vi)
below,
(v) bonds issued or guaranteed by first class issuers offering an adequate liquidity, or
(vi) shares admitted to or dealt in on a regulated market of an EU Member State or on a stock
exchange of a member state of the OECD, on the condition that these shares are included in a main
index.
Cash collateral received by the Company should only be:
 placed on deposit with entities prescribed in 1) (f) of Appendix A;
 invested in high-quality government bonds;
 used for the purpose of reverse repo transactions provided the transactions are with credit
institutions subject to prudential supervision and the Company is able to recall at any time
the full amount of cash on accrued basis;
 invested in short-term money market funds as defined in the Guidelines on a Common
Definition of European Money Market Funds issued by ESMA.
The principal risk when lending securities is that the borrower might become insolvent or refuse to
honour its obligations to return the securities. In this event, a Sub-fund could experience delays in
recovering its securities and may possibly incur a capital loss. A Sub-fund may also incur a loss in
reinvesting the cash collateral it receives. Such a loss may arise due to a decline in the value of the
investment made with cash collateral received from a securities lending counterparty. A decline in
the value of such investment of the cash collateral would reduce the amount of collateral available
to be returned by the Sub-fund to the securities lending counterparty at the conclusion of the
securities lending contract. The Sub-fund would be required to cover the difference in value
between the collateral originally received and the amount available to be returned to the
counterparty, thereby resulting in a loss to the Sub-fund.
The securities borrowed by the Company may not be disposed of during the time they are held by
the Company, unless they are covered by sufficient financial instruments which enable the
Company to return the borrowed securities at the close of the transaction.
The Company may borrow securities under the following circumstances in connection with the
settlement of a sale transaction: (a) during a period the securities have been sent out for
- 51 -
re-registration; (b) when the securities have been loaned and not returned in time; (c) to avoid a
failed settlement when the Custodian fails to make delivery; and (d) as a technique to meet its
obligation to deliver the securities being the object of a repurchase agreement when the
counterparty to such agreement exercises the right to repurchase these securities, to the extent such
securities have been previously sold by the Company.
The collateral control uses hair cut that depends on issuer, rating, maturity and guarantees to
control and manage collateral. The collateral control is part of the counterparty and credit risk
policy.
Follow a summary of risk policy that applied in Sub-fund with credit or counterparty risk:
1. Counterparty risks:
Risk Identification
Risk Measurement, Management and Monitoring
Risk
Category
Process
Measures/Controls
Approach to Limitation
Frequency of
Measurement
Counterparty
risks
Credit Risk
Control
Control of Positive list of
counterparties and limits per
counterparty
Pre and Pos Trading
Module of Charles River
System
Daily Basis
Broker and
Prime Broker
Selection
Due Diligence process with
Risk Area, Compliance and
Portfolio Manager
Internal approval in
Broker Committee with
appraisal from Risk Area
Two times per
year
2. Credit risks:
Risk Identification
Risk Measurement, Management and Monitoring
Risk
Category
Process
Measures/Controls
Approach to
Limitation
Frequency of
Measurement
Credit risks
Credit Risk
Control
Restriction and limits per
Issuer, Concentration inside
the portfolio, Limits per
internal and external rating
Pre and Pos Trading
Module of Charles River
System
Daily Basis
- 52 -
APPENDIX C
DETAILS OF EACH SUB-FUND
List of Sub-funds:
Itaú Funds - Latin America Equity Fund
Itaú Funds - Brazil Equity Fund
Itaú Funds - Latin America Ex-Brazil Equity Fund
Itaú Funds – Conservative Fund
Itaú Funds – Moderate Fund
Itaú Funds – Growth Fund
Itaú Funds – Aggressive Growth Fund
- 53 -
ITAÚ FUNDS LATIN AMERICA EQUITY FUND
INVESTMENT OBJECTIVES
The objective of the Sub-fund is to obtain a superior return, in the medium and long term, over the MSCI
Latin America 10/40 Index (the “MSCI Latam 10/40”) through investments in Latin American stocks, by
using the fundamentalist criteria (stock-picking).
The investment management method used is to select companies according to their potential growth,
their strategy, their macro-economic environment and the quality of these companies’ managers.
INVESTMENT POLICY
The diversified portfolio of the Sub-fund is mainly invested in shares and other equity securities issued
by Latin American companies and financial institutions listed on the Latin American Stock Exchanges
including investments in ADRs and GDRs. Considering the volatility of the Latin American markets and
in order to maintain a certain level of liquidity, the Sub-fund may also invest in money market
instruments denominated in US Dollars with a residual maturity of less than twelve months.
The Sub-fund may, furthermore and on an ancillary basis, invest in fixed-income bonds and hold cash or
other cash equivalents.
The Sub-fund may invest up to 10% of its net assets in UCITS and other UCIs, including ETFs.
Investments are normally made in securities denominated in US Dollars, Euro and Latin American
currencies and are subject to fluctuations to the respective currency of the Sub-fund.
The currency exposure of the part of the Sub-fund’s assets invested in currencies other than the US
Dollar may be hedged against the Sub-fund’s reference currency. Hence, the US Dollar value of these
assets may vary considerably.
Considering the composition of the MSCI Latam 10/40, the Sub-fund is permitted to invest up to 10% of
its net assets in equities or securities of the same issuer. In addition, the Sub-fund may invest in aggregate
up to 20% of its assets in transferable securities and money market instruments with the same group, as
determined by item 7(f) of section “Risk diversification” of Appendix A. For the avoidance of doubt, the
Sub-fund will not use any other of the exceptions listed under the referred section “Risk diversification”
of Appendix A with respect to investments within the same issuer and with respect to investments in
transferable securities and money market instruments with the same group. Moreover, the total value
invested in equities or securities of issuers that represent - for each issuer - more than 5% of the net assets
of the Sub-fund should not exceed 40% of such net assets.
For the purpose of efficient portfolio management and in order to dynamise/secure the portfolio, the
Sub-fund may employ techniques and instruments relating to transferable securities or techniques and
instruments aimed at hedging or trading within the limits set out in this Prospectus.
Profile of the Typical
Investor
As a result of the volatility of the Latin American market, the Sub-fund
is only suitable for investors seeking to benefit from long-term growth
opportunities in the Latin American equity market and who are
prepared to accept the risk of a Latin American exposure to the local
currencies associated with the currency strategy of the Sub-fund.
Attention of prospective investors is drawn to the fact that the Board of
Directors could decide that investors from certain countries will not be
accepted in the Sub-fund. The excluded countries (if any) are listed in
the Subscription Form.
- 54 -
Risk Factors
Shareholders should be aware that the above Investment Objectives
and Policy permit the Sub-fund to concentrate on a limited number of
investments, which may result in lesser risk diversification.
As a result of the volatility of the Latin American markets, the
Sub-fund is only suitable for experienced investors seeking to benefit
from long-term growth opportunities in the Latin American equity
markets.
Investments in emerging markets such as Latin American markets
carry risks additional to those inherent in other investments. In
particular, potential investors in the Sub-fund should note that
investment in any emerging market carries a higher risk than
investment in a developed market, such as further explained in Section
7.6 of the Prospectus.
In addition to the risk factors described herein, Shareholders should
note that the Latin American stock markets tend to be highly volatile
and relatively illiquid. In particular the Shareholders should be aware
that the cash positions held in Latin American currencies, even when
held through money market funds, might be subject to substantial
changes in the exchange rates versus the Reference Currency of the
Sub-fund and affect the value of the shares held in the Sub-fund.
Shareholders should also be aware that the possibility for the Sub-fund
to enter into options, futures, repurchase agreements and other
derivatives for the purpose of efficient portfolio management might
entail risks of losses for the Sub-fund due to the relative volatility and
the embedded leverage effect of such investments.
There is no guarantee of a secondary market for the investments of the
Sub-fund and thus there is a risk of delay if the Sub-fund receives a
large and unexpected demand for redemption. Investment in the
Sub-fund should be regarded as suitable only for Shareholders that
understand the risks involved. Investment in the Sub-fund should be
regarded as long term in nature. Prospective investors should satisfy
themselves about the risks, taking independent advice, as they deem
appropriate before proceeding.
Investors should be aware that the acquisition of derivative
instruments involves certain risks that could have a negative effect on
the performance of the Sub-fund.
Global Exposure Calculation
Methodology
The global exposure will be calculated by using the commitment
approach.
Reference Currency
USD
Benchmark
MSCI Latin America 10/40 Index
- 55 -
Classes
Class A Shares are available for all investors.
Class I Shares are reserved to Institutional Investors.
Class X Shares are reserved to investors (whether Institutional
Investors or Retail Investors) who have a specific agreement or
partnership with the Investment Manager or any entity of the Itaú
Group authorising investment in Class X Shares.
Class Y Shares are reserved to Institutional Investors who have a
specific agreement or partnership with the Investment Manager or any
entity of the Itaú Group authorising investment in Class Y Shares.
Distribution Policy
Class A: accumulating shares
Class I: accumulating shares
Class X: accumulating shares
Class Y: accumulating shares
Initial Subscription Period
Class X: to be determined by the Board of Directors
Class Y: to be determined by the Board of Directors
Initial Price
Class X: USD 100.Class Y: USD 100.-
Minimum Initial Investment
Class A: USD 5,000.Class I: USD 1,000,000.Class X: none
Class Y: none
Minimum Subsequent
Investment
Class A: USD 1,000.Class I: USD 50,000.Class X: none
Class Y: none
Minimum Holding Amount
Class A: USD 5,000.Class I: USD 1,000,000.Class X: none
Class Y: none
- 56 -
Minimum Redemption
Amount
Class A: USD 1,000.Class I: USD 50,000.Class X: none
Class Y: none
Minimum Conversion
Amount
None
Subscription Commission
Class A: up to 5% of the Net Asset Value per Share
Class I: none
Class X: none
Class Y: none
Redemption Commission
None
Conversion Commission
None
Investment Management Fee
Class A: 1.50% per annum of the Net Asset Value
Class I: 1.00% per annum of the Net Asset Value
Class X: none
Class Y: 0.10% per annum of the Net Asset Value
Custody Fees
Fees are divided into two categories for each market of investment:
Safekeeping fee: annual fee billed and payable monthly based on the
value of the month end assets up to 0.35%.
Transaction fee: a per trade cost up to USD 135.-
Central Administration Fees
Up to 0.05% per annum of the Net Asset Value, provided that a certain
minimum fee may apply.
Global Distribution Fees
Class A: up to 0.25% per annum of the Net Asset Value
Class I: none
Class X: none
Class Y: none
Valuation Day
Every Business Day
- 57 -
Business Day
Any full working business day in Luxembourg, New York and São
Paulo when the banks are open for business. For the avoidance of
doubt, half-closed bank business days in Luxembourg (such as 24
December) are considered as being closed for business.
Sub-fund Subscription
Deadline
5:00 p.m. CET
Sub-fund Conversion
Deadline
5:00 p.m. CET
Sub-fund Redemption
Deadline
5:00 p.m. CET
Investment Manager
Itaú USA Asset Management Inc.
- 58 -
ITAÚ FUNDS BRAZIL EQUITY FUND
INVESTMENT OBJECTIVES
The objective of the Sub-fund is to obtain a superior return, in the medium and long term, over the MSCI
Brazil 10/40 Index (the “MSCI Brazil 10/40”), through investments in Brazilian stocks, by using the
fundamentalist criteria (stock-picking).
The investment management method used is to select companies according to their potential growth,
their strategy, their macro-economic environment and the quality of these companies’ managers.
INVESTMENT POLICY
The diversified portfolio of the Sub-fund is mainly invested in shares and other equity securities issued
by Brazilian companies and financial institutions listed on the Brazilian Stock Exchanges including
investments in ADRs and GDRs. Considering the volatility of the Brazilian markets and in order to
maintain a certain level of liquidity, the Sub-fund may also invest in money market instruments
denominated in US Dollars with a residual maturity of less than twelve months.
The Sub-fund may, furthermore and on an ancillary basis, invest in fixed-income bonds and hold cash or
other cash equivalents.
The Sub-fund may invest up to 10% of its net assets in UCITS and other UCIs, including ETFs.
Investments are normally made in securities denominated in US Dollars, Euro and Real currencies and
are subject to fluctuations to the respective currency of the Sub-fund.
The currency exposure of the part of the Sub-fund’s assets invested in currencies other than the US
Dollar may be hedged against the Sub-fund’s reference currency. Hence, the US Dollar value of these
assets may vary considerably.
Considering the composition of the MSCI Brazil 10/40, the Sub-fund is permitted to invest up to 10% of
its net assets in equities or securities of the same issuer. In addition, the Sub-fund may invest in aggregate
up to 20% of its assets in transferable securities and money market instruments with the same group, as
determined by item 7(f) of section “Risk diversification” of Appendix A. For the avoidance of doubt, the
Sub-fund will not use any other of the exceptions listed under the referred section “Risk diversification”
of Appendix A with respect to investments within the same issuer and with respect to investments in
transferable securities and money market instruments with the same group. Moreover, the total value
invested in equities or securities of issuers that represent - for each issuer - more than 5% of the net assets
of the Sub-fund should not exceed 40% of such net assets.
For the purpose of efficient portfolio management and in order to dynamise/secure the portfolio, the
Sub-fund may employ techniques and instruments relating to transferable securities or techniques and
instruments aimed at hedging or trading within the limits set out in this Prospectus.
Profile of the Typical
Investor
As a result of the volatility of the Brazilian market, the Sub-fund is
only suitable for investors seeking to benefit from long-term growth
opportunities in the Brazilian equity market and who are prepared to
accept the risk of a Brazilian exposure to the Real associated with the
currency strategy of the Sub-fund.
Attention of prospective investors is drawn to the fact that the Board of
Directors could decide that investors from certain countries will not be
accepted in the Sub-fund. The excluded countries (if any) are listed in
the Subscription Form.
- 59 -
Risk Factors
Shareholders should be aware that the above Investment Objectives
and Policy permit the Sub-fund to concentrate on a limited number of
investments, which may result in lesser risk diversification.
As a result of the volatility of the Brazilian market, the Sub-fund is
only suitable for experienced investors seeking to benefit from
long-term growth opportunities in the Brazilian equity market.
Investments in emerging markets such as the Brazilian market carry
risks additional to those inherent in other investments. In particular,
potential investors in the Sub-fund should note that investment in any
emerging market carries a higher risk than investment in a developed
market, such as further explained in Section 7.6 of the Prospectus.
In addition to the risk factors described herein, Shareholders should
note that the Brazilian stock markets tend to be highly volatile and
relatively illiquid. In particular the Shareholders should be aware that
the cash positions held in Brazilian Real, even when held through
money market funds, might be subject to substantial changes in the
exchange rates versus the Reference Currency of the Sub-fund and
affect the value of the shares held in the Sub-fund.
Shareholders should also be aware that the possibility for the Sub-fund
to enter into options, futures, repurchase agreements and other
derivatives for the purpose of efficient portfolio management might
entail risks of losses for the Sub-fund due to the relative volatility and
the embedded leverage effect of such investments.
There is no guarantee of a secondary market for the investments of the
Sub-fund and thus there is a risk of delay if the Sub-fund receives a
large and unexpected demand for redemption. Investment in the
Sub-fund should be regarded as suitable only for Shareholders that
understand the risks involved. Investment in the Sub-fund should be
regarded as long term in nature. Prospective investors should satisfy
themselves about the risks, taking independent advice, as they deem
appropriate before proceeding.
Investors should be aware that the acquisition of derivative
instruments involves certain risks that could have a negative effect on
the performance of the Sub-fund.
Global Exposure Calculation
Methodology
The global exposure will be calculated by using the commitment
approach.
Reference Currency
USD
Benchmark
MSCI Brazil 10/40 Index
- 60 -
Classes
Class A Shares are available for all investors.
Class I Shares are reserved to Institutional Investors.
Class X Shares are reserved to investors (whether Institutional
Investors or Retail Investors) who have a specific agreement or
partnership with the Investment Manager or any entity of the Itaú
Group authorising investment in Class X Shares.
Class Y Shares are reserved to Institutional Investors who have a
specific agreement or partnership with the Investment Manager or any
entity of the Itaú Group authorising investment in Class Y Shares.
Distribution Policy
Class A: accumulating shares
Class I: accumulating shares
Class X: accumulating shares
Class Y: accumulating shares
Initial Subscription Period
Class A: to be determined by the Board of Directors
Class X: to be determined by the Board of Directors
Class Y: to be determined by the Board of Directors
Initial Price
Class A: USD 100.Class X: USD 100.Class Y: USD 100.-
Minimum Initial Investment
Class A: USD 5,000.Class I: USD 1,000,000.Class X: none
Class Y: none
Minimum Subsequent
Investment
Class A: USD 1,000.Class I: USD 50,000.Class X: none
Class Y: none
- 61 -
Minimum Holding Amount
Class A: USD 5,000.Class I: USD 1,000,000.Class X: none
Class Y: none
Minimum Redemption
Amount
Class A: USD 1,000.Class I: USD 50,000.Class X: none
Class Y: none
Minimum Conversion
Amount
None
Subscription Commission
Class A: up to 5% of the Net Asset Value per Share
Class I: none
Class X: none
Class Y: none
Redemption Commission
None
Conversion Commission
None
Investment Management Fee
Class A: 1.50% per annum of the Net Asset Value
Class I: 1.00% per annum of the Net Asset Value
Class X: none
Class Y: 0.10% per annum of the Net Asset Value
Custody Fees
Fees are divided into two categories for each market of investment:
Safekeeping fee: annual fee billed and payable monthly based on the
value of the month end assets up to 0.35%.
Transaction fee: a per trade cost up to USD 135.-
Central Administration Fees
Up to 0.05% per annum of the Net Asset Value, provided that a certain
minimum fee may apply.
- 62 -
Global Distribution Fees
Class A: up to 0.25% per annum of the Net Asset Value
Class I: none
Class X: none
Class Y: none
Valuation Day
Every Business Day
Business Day
Any full working business day in Luxembourg, New York and São
Paulo when the banks are open for business. For the avoidance of
doubt, half-closed bank business days in Luxembourg (such as 24
December) are considered as being closed for business.
Sub-fund Subscription
Deadline
5:00 p.m. CET
Sub-fund Conversion
Deadline
5:00 p.m. CET
Sub-fund Redemption
Deadline
5:00 p.m. CET
Investment Manager
Itaú USA Asset Management Inc.
- 63 -
ITAÚ FUNDS LATIN AMERICA EX-BRAZIL EQUITY FUND
INVESTMENT OBJECTIVES
The objective of the Sub-fund is to obtain a superior return, in the medium and long term, over the MSCI
Latin America Ex Brazil 10/40 Net TR (the “MSCI Latam Ex Brazil 10/40”) through investments in
Latin American stocks excluding Brazil, by using the fundamentalist criteria (stock-picking).
The investment management method used is to select companies according to their potential growth,
their strategy, their macro-economic environment and the quality of these companies’ managers.
INVESTMENT POLICY
The diversified portfolio of the Sub-fund is mainly invested in shares and other equity securities issued
by companies and financial institutions in Latin American countries excluding Brazil and listed on these
countries’ Stock Exchanges including investments in ADRs and GDRs. Considering the volatility of
these markets and in order to maintain a certain level of liquidity, the Sub-fund may also invest in money
market instruments denominated in US Dollars with a residual maturity of less than twelve months.
The Sub-fund may, furthermore and on an ancillary basis, invest in fixed-income bonds and hold cash or
other cash equivalents.
The Sub-fund may invest up to 10% over or under the percentage of REITs in MSCI Latam Ex Brazil
10/40 and up to 10% of its net assets in UCITS and other UCIs, including ETFs.
The Sub-fund will not invest in mortgage-backed or other asset-backed securities.
Investments are normally made in securities denominated in US Dollars, Euro and Latin American
currencies (excluding the Real) and are subject to fluctuations to the respective currency of the Sub-fund.
The currency exposure of the part of the Sub-fund’s assets invested in currencies other than the US
Dollar may be hedged against the Sub-fund’s reference currency. Hence, the US Dollar value of these
assets may vary considerably.
The Sub-fund is permitted to invest up to 10% of its net assets in equities or securities of the same issuer.
In addition, the Sub-fund may invest in aggregate up to 20% of its assets in transferable securities and
money market instruments with the same group, as determined by item 7(f) of section “Risk
diversification” of Appendix A. For the avoidance of doubt, the Sub-fund will not use any other of the
exceptions listed under the referred section “Risk diversification” of Appendix A with respect to
investments within the same issuer and with respect to investments in transferable securities and money
market instruments with the same group. Moreover, the total value invested in equities or securities of
issuers that represent - for each issuer - more than 5% of the net assets of the Sub-fund should not exceed
40% of such net assets.
For the purpose of efficient portfolio management and in order to dynamise/secure the portfolio, the
Sub-fund may employ techniques and instruments relating to transferable securities or techniques and
instruments aimed at hedging or trading within the limits set out in this Prospectus.
Profile of the Typical
Investor
As a result of the volatility of the Latin American market, the Sub-fund
is only suitable for investors seeking to benefit from long-term growth
opportunities in the Latin American equity market and who are
prepared to accept the risk of a Latin American exposure to the local
currencies associated with the currency strategy of the Sub-fund.
Attention of prospective investors is drawn to the fact that the Board of
Directors could decide that investors from certain countries will not be
accepted in the Sub-fund. The excluded countries (if any) are listed in
the Subscription Form.
- 64 -
Risk Factors
Shareholders should be aware that the above Investment Objectives
and Policy permit the Sub-fund to concentrate on a limited number of
investments, which may result in lesser risk diversification.
As a result of the volatility of the Latin American markets, the
Sub-fund is only suitable for experienced investors seeking to benefit
from long-term growth opportunities in the Latin American equity
markets.
Investments in emerging markets such as Latin American markets
carry risks additional to those inherent in other investments. In
particular, potential investors in the Sub-fund should note that
investment in any emerging market carries a higher risk than
investment in a developed market, such as further explained in Section
7.6 of the Prospectus.
In addition to the risk factors described herein, Shareholders should
note that the Latin American stock markets tend to be highly volatile
and relatively illiquid. In particular the Shareholders should be aware
that the cash positions held in Latin American currencies, even when
held through money market funds, might be subject to substantial
changes in the exchange rates versus the Reference Currency of the
Sub-fund and affect the value of the shares held in the Sub-fund.
Shareholders should also be aware that the possibility for the Sub-fund
to enter into options, futures, repurchase agreements and other
derivatives for the purpose of efficient portfolio management might
entail risks of losses for the Sub-fund due to the relative volatility and
the embedded leverage effect of such investments.
There is no guarantee of a secondary market for the investments of the
Sub-fund and thus there is a risk of delay if the Sub-fund receives a
large and unexpected demand for redemption. Investment in the
Sub-fund should be regarded as suitable only for Shareholders that
understand the risks involved. Investment in the Sub-fund should be
regarded as long term in nature. Prospective investors should satisfy
themselves about the risks, taking independent advice, as they deem
appropriate before proceeding.
Investors should be aware that the acquisition of derivative
instruments involves certain risks that could have a negative effect on
the performance of the Sub-fund.
Global Exposure Calculation
Methodology
The global exposure will be calculated by using the commitment
approach.
Reference Currency
USD
Benchmark
MSCI Latin America ex Brazil 10/40 Net TR
- 65 -
Classes
Class A Shares are available for all investors.
Class I Shares are reserved to Institutional Investors.
Class X Shares are reserved to investors (whether Institutional
Investors or Retail Investors) who have a specific agreement or
partnership with the Investment Manager or any entity of the Itaú
Group authorising investment in Class X Shares.
Class Y Shares are reserved to Institutional Investors who have a
specific agreement or partnership with the Investment Manager or any
entity of the Itaú Group authorising investment in Class Y Shares.
Distribution Policy
Class A: accumulating shares
Class I: accumulating shares
Class X: accumulating shares
Class Y: accumulating shares
Initial Subscription Period
Class A: to be determined by the Board of Directors
Class I: to be determined by the Board of Directors
Class X: to be determined by the Board of Directors
Class Y: to be determined by the Board of Directors
Initial Price
Class A: USD 100.Class I: USD 100.Class X: USD 100.Class Y: USD 100.-
Minimum Initial Investment
Class A: USD 5,000.Class I: USD 1,000,000.Class X: none
Class Y: none
Minimum Subsequent
Investment
Class A: USD 1,000.Class I: USD 50,000.Class X: none
Class Y: none
- 66 -
Minimum Holding Amount
Class A: USD 5,000.Class I: USD 1,000,000.Class X: none
Class Y: none
Minimum Redemption
Amount
Class A: USD 1,000.Class I: USD 50,000.Class X: none
Class Y: none
Minimum Conversion
Amount
None
Subscription Commission
Class A: up to 5% of the Net Asset Value per Share
Class I: none
Class X: none
Class Y: none
Redemption Commission
None
Conversion Commission
None
Investment Management Fee
Class A: 1.50% per annum of the Net Asset Value
Class I: 1.00% per annum of the Net Asset Value
Class X: none
Class Y: 0.10% per annum of the Net Asset Value
Custody Fees
Fees are divided into two categories for each market of investment:
Safekeeping fee: annual fee billed and payable monthly based on the
value of the month end assets up to 0.35%.
Transaction fee: a per trade cost up to USD 135.-
Central Administration Fees
Up to 0.05% per annum of the Net Asset Value, provided that a certain
minimum fee may apply.
- 67 -
Global Distribution Fees
Class A: up to 0.25% per annum of the Net Asset Value
Class I: none
Class X: none
Class Y: none
Valuation Day
Every Business Day
Business Day
Any full working business day in Luxembourg and New York when
the banks are open for business. For the avoidance of doubt,
half-closed bank business days in Luxembourg (such as 24 December)
are considered as being closed for business.
Sub-fund Subscription
Deadline
5:00 p.m. CET
Sub-fund Conversion
Deadline
5:00 p.m. CET
Sub-fund Redemption
Deadline
5:00 p.m. CET
Investment Manager
Itaú USA Asset Management Inc.
- 68 -
ITAÚ FUNDS CONSERVATIVE FUND
INVESTMENT OBJECTIVES
The investment objective of the Sub-fund is to achieve capital preservation over a market cycle while
generating income consistent with market conditions through diversified investments primarily in
units/shares of UCITS and other UCIs, including ETFs that provide exposure to a wide spectrum of asset
classes worldwide.
The Sub-fund intends to have a dynamic asset allocation to capture return mainly from equity and fixed
income, provided that the Sub-fund, under normal market conditions, aims to maintain 20% of its
portfolio in investments that provide an exposure to equity (having the “MSCI AC World Daily TR Net
USD - NDUEACWF Index” as an indicative benchmark) and 80% of its portfolio in investments that
provide an exposure to fixed income (having the “JPM Global Aggregate Bond Index - Total Return
Unhedged USD - JGAGGUSD Index” as an indicative benchmark).
INVESTMENT POLICY
The Sub-fund may invest up to 100% of its net assets in units/shares of UCITS, provided that no more
than 20% of the Sub-fund’s net assets be invested in aggregate in units/shares of the same UCITS and no
more than 10% of such UCITS’ net assets be invested in aggregate in units/shares of other UCITS.
Investments made in units/shares of ETFs that are UCIs other than UCITS may not exceed, in aggregate,
30% of the net assets of the Sub-fund.
The Sub-fund is permitted to invest up to 10% of its net assets in units/shares of the same closed ended
ETF that qualifies as a transferable security.
The Sub-fund is permitted to invest up to 10% of its net assets in equities or securities of the same issuer.
In addition, the Sub-fund may invest in aggregate up to 20% of its assets in transferable securities and
money market instruments with the same group, as determined by item 7(f) of section “Risk
diversification” of Appendix A. For the avoidance of doubt, the Sub-fund will not use any other of the
exceptions listed under the referred section “Risk diversification” of Appendix A with respect to
investments within the same issuer and with respect to investments in transferable securities and money
market instruments with the same group. In addition, the total value invested in securities of issuers that
represent - for each issuer - more than 5% of the assets of the Sub-fund should not exceed 40% of such
net assets.
The Sub-fund intends to have a dynamic asset allocation among a range of asset classes in a flexible way
to capture return from equity, fixed income and other sources. Furthermore, the Sub-fund may have
exposure via UCITS and UCIs, including open ended and closed ended ETFs, to commodities and real
estate investments.
There may be occasions of adverse market conditions in which the Investment Manager will wish to hold
significant positions in cash or near cash instruments. Cash may be held at, and cash instruments may
include those issued by affiliates of the Investment Manager.
For the purpose of efficient portfolio management and in order to dynamise/secure the portfolio, the
Sub-fund may employ techniques and instruments relating to transferable securities or techniques and
instruments aimed at hedging.
- 69 -
Profile of the Typical
Investor
As a result of the volatility of the global markets, the Sub-fund is only
suitable for investors seeking to achieve capital preservation.
Attention of prospective investors is drawn to the fact that the Board of
Directors could decide that investors from certain countries will not be
accepted in the Sub-fund. The excluded countries (if any) are listed in
the Subscription Form.
Risk Factors
The Sub-fund may invest in transferable securities denominated in
local currencies, and may hold cash in such currencies. Therefore,
currency fluctuations of such currencies vis-à-vis the USD may
influence the value of the Sub-fund.
Generally, investments in emerging market countries involve greater
risks due to the lack of an appropriate system for the transfer, price
calculation and accounting of the transferable securities and to their
custody and record keeping.
No guarantee or representation is made that the underlying funds’
investment programs will be successful, that the underlying funds or
the Sub-fund will achieve any targeted returns or that there will be any
return on (or of) any amounts invested, and investment results may
vary substantially over time. In addition, investments made by the
Sub-fund in the underlying funds, which may include funds managed
by the Investment Manager or by its affiliates, are subject to costs and
fees charged by the underlying funds, including but not limited to
portfolio management fees.
Although the Sub-fund will attempt to hedge its exposure to specific
positions, it will not always be possible to fully hedge risk from such
positions or any other position. In addition, the Sub-fund may take
positions based on the expected future direction of the markets without
fully hedging the market risks.
There is no guarantee of a secondary market for the investments of the
Sub-fund and thus there is a risk of delay if the Sub-fund receives a
large and unexpected demand for redemption. Investment in the
Sub-fund should be regarded as suitable only for Shareholders that
understand the risks involved. Investment in the Sub-fund should be
regarded as long term in nature. Prospective investors should satisfy
themselves about the risks, taking independent advice, as they deem
appropriate before proceeding.
Global Exposure Calculation
Methodology
The global exposure will be calculated by using the commitment
approach.
Reference Currency
USD
Benchmarks
20% MSCI AC World Daily TR Net USD (NDUEACWF Index) and
80% JPM Global Aggregate Bond Index - Total Return Unhedged
USD (JGAGGUSD Index).
- 70 -
Classes
Class A Shares are available for all investors.
Class Y Shares are reserved to Institutional Investors who have a
specific agreement or partnership with the Investment Manager or any
entity of the Itaú Group authorising investment in Class Y Shares.
Distribution Policy
Class A: accumulating shares
Class Y: accumulating shares
Initial Subscription Period
Class A: to be determined by the Board of Directors
Class Y: to be determined by the Board of Directors
Initial Price
Class A: USD 100.Class Y: USD 100.-
Minimum Initial Investment
None
Minimum Subsequent
Investment
None
Minimum Holding Amount
None
Minimum Redemption
Amount
None
Minimum Conversion
Amount
None
Subscription Commission
Class A: up to 5% of the Net Asset Value per Share
Class Y: None
Redemption Commission
None
Conversion Commission
None
Investment Management Fee
Class A: 1.0% per annum of the Net Asset Value
Class Y: 0.10% per annum of the Net Asset Value
Maximum Level of
Management Fees Charged
both to the Sub-fund and to
the UCITS and Other UCIs
Class A: 2.25%
Class Y: 1.35%
- 71 -
Custody Fees
Fees are divided into two categories for each market of investment:
Safekeeping fee: annual fee billed and payable monthly based on the
value of the month end assets up to 0.35%.
Transaction fee: a per trade cost up to USD 135.-
Central Administration Fees
Up to 0.05% per annum of the Net Asset Value, provided that a certain
minimum fee may apply.
Global Distribution Fees
Class A: up to 0.25% per annum of the Net Asset Value
Class Y: None
Valuation Day
Every Business Day
Business Day
Any full working business day in Luxembourg, Dublin and New York
when the banks are open for business. For the avoidance of doubt,
half-closed bank business days in Luxembourg and Dublin (such as 24
December) are considered as being closed for business.
Sub-fund Subscription
Deadline
5:00 p.m. CET
Sub-fund Conversion
Deadline
5:00 p.m. CET
Sub-fund Redemption
Deadline
5:00 p.m. CET
Investment Manager
Itaú USA Asset Management Inc.
- 72 -
ITAÚ FUNDS MODERATE FUND
INVESTMENT OBJECTIVES
The investment objective of the Sub-fund is to achieve a combination of growth and income through
diversified investments primarily in units/shares of UCITS and other UCIs, including ETFs that provide
exposure to a wide spectrum of asset classes worldwide.
The Sub-fund intends to have a dynamic asset allocation to capture return mainly from equity and fixed
income, provided that the Sub-fund, under normal market conditions, aims to maintain 40% of its
portfolio in investments that provide an exposure to equity (having the “MSCI AC World Daily TR Net
USD - NDUEACWF Index” as an indicative benchmark) and 60% of its portfolio in investments that
provide an exposure to fixed income (having the “JPM Global Aggregate Bond Index - Total Return
Unhedged USD – JGAGGUSD Index” as an indicative benchmark).
INVESTMENT POLICY
The Sub-fund may invest up to 100% of its net assets in units/shares of UCITS, provided that no more
than 20% of the Sub-fund’s net assets be invested in aggregate in units/shares of the same UCITS and no
more than 10% of such UCITS’ net assets be invested in aggregate in units/shares of other UCITS.
Investments made in units/shares of ETFs that are UCIs other than UCITS may not exceed, in aggregate,
30% of the net assets of the Sub-fund.
The Sub-fund is permitted to invest up to 10% of its net assets in units/shares of the same closed ended
ETF that qualifies as a transferable security.
The Sub-fund is permitted to invest up to 10% of its net assets in equities or securities of the same issuer.
In addition, the Sub-fund may invest in aggregate up to 20% of its assets in transferable securities and
money market instruments with the same group, as determined by item 7(f) of section “Risk
diversification” of Appendix A. For the avoidance of doubt, the Sub-fund will not use any other of the
exceptions listed under the referred section “Risk diversification” of Appendix A with respect to
investments within the same issuer and with respect to investments in transferable securities and money
market instruments with the same group. In addition, the total value invested in securities of issuers that
represent - for each issuer - more than 5% of the assets of the Sub-fund should not exceed 40% of such
net assets.
The Sub-fund intends to have a dynamic asset allocation among a range of asset classes in a flexible way
to capture return from equity, fixed income and other sources. Furthermore, the Sub-fund may have
exposure via UCITS and UCIs, including open ended and closed ended ETFs, to commodities and real
estate investments.
There may be occasions of adverse market conditions in which the Investment Manager will wish to hold
significant positions in cash or near cash instruments. Cash may be held at, and cash instruments may
include those issued by affiliates of the Investment Manager.
For the purpose of efficient portfolio management and in order to dynamise/secure the portfolio, the
Sub-fund may employ techniques and instruments relating to transferable securities or techniques and
instruments aimed at hedging.
- 73 -
Profile of the Typical
Investor
As a result of the volatility of the global markets, the Sub-fund is only
suitable for investors seeking to achieve a combination of growth and
income.
Attention of prospective investors is drawn to the fact that the Board of
Directors could decide that investors from certain countries will not be
accepted in the Sub-fund. The excluded countries (if any) are listed in
the Subscription Form.
Risk Factors
The Sub-fund may invest in transferable securities denominated in
local currencies, and may hold cash in such currencies. Therefore,
currency fluctuations of such currencies vis-à-vis the USD may
influence the value of the Sub-fund.
Generally, investments in emerging market countries involve greater
risks due to the lack of an appropriate system for the transfer, price
calculation and accounting of the transferable securities and to their
custody and record keeping.
No guarantee or representation is made that the underlying funds’
investment programs will be successful, that the underlying funds or
the Sub-fund will achieve any targeted returns or that there will be any
return on (or of) any amounts invested, and investment results may
vary substantially over time. In addition, investments made by the
Sub-fund in the underlying funds, which may include funds managed
by the Investment Manager or by its affiliates, are subject to costs and
fees charged by the underlying funds, including but not limited to
portfolio management fees.
Although the Sub-fund will attempt to hedge its exposure to specific
positions, it will not always be possible to fully hedge risk from such
positions or any other position. In addition, the Sub-fund may take
positions based on the expected future direction of the markets without
fully hedging the market risks.
There is no guarantee of a secondary market for the investments of the
Sub-fund and thus there is a risk of delay if the Sub-fund receives a
large and unexpected demand for redemption. Investment in the
Sub-fund should be regarded as suitable only for Shareholders that
understand the risks involved. Investment in the Sub-fund should be
regarded as long term in nature. Prospective investors should satisfy
themselves about the risks, taking independent advice, as they deem
appropriate before proceeding.
Global Exposure Calculation
Methodology
The global exposure will be calculated by using the commitment
approach.
Reference Currency
USD
Benchmarks
40% MSCI AC World Daily TR Net USD (NDUEACWF Index) and
60% JPM Global Aggregate Bond Index - Total Return Unhedged
USD (JGAGGUSD Index)
- 74 -
Classes
Class A Shares are available for all investors.
Class Y Shares are reserved to Institutional Investors who have a
specific agreement or partnership with the Investment Manager or any
entity of the Itaú Group authorising investment in Class Y Shares.
Distribution Policy
Class A: accumulating shares
Class Y: accumulating shares
Initial Subscription Period
Class A: to be determined by the Board of Directors
Class Y: to be determined by the Board of Directors
Initial Price
Class A: USD 100.Class Y: USD 100.-
Minimum Initial Investment
None
Minimum Subsequent
Investment
None
Minimum Holding Amount
None
Minimum Redemption
Amount
None
Minimum Conversion
Amount
None
Subscription Commission
Class A: up to 5% of the Net Asset Value per Share
Class Y: None
Redemption Commission
None
Conversion Commission
None
Investment Management Fee
Class A: 1.2% per annum of the Net Asset Value
Class Y: 0.10% per annum of the Net Asset Value
Maximum Level of
Management Fees Charged
both to the Sub-fund and to
the UCITS and Other UCIs
Class A: 2.45%
Class Y: 1.35%
- 75 -
Custody Fees
Fees are divided into two categories for each market of investment:
Safekeeping fee: annual fee billed and payable monthly based on the
value of the month end assets up to 0.35%.
Transaction fee: a per trade cost up to USD 135.-
Central Administration Fees
Up to 0.05% per annum of the Net Asset Value, provided that a certain
minimum fee may apply.
Global Distribution Fees
Class A: up to 0.25% per annum of the Net Asset Value
Class Y: None
Valuation Day
Every Business Day
Business Day
Any full working business day in Luxembourg, Dublin and New York
when the banks are open for business. For the avoidance of doubt,
half-closed bank business days in Luxembourg and Dublin (such as 24
December) are considered as being closed for business.
Sub-fund Subscription
Deadline
5:00 p.m. CET
Sub-fund Conversion
Deadline
5:00 p.m. CET
Sub-fund Redemption
Deadline
5:00 p.m. CET
Investment Manager
Itaú USA Asset Management Inc.
- 76 -
ITAÚ FUNDS GROWTH FUND
INVESTMENT OBJECTIVES
The investment objective of the Sub-fund is to achieve long-term capital growth of principal and income
through diversified investments primarily in units/shares of UCITS and other UCIs, including ETFs that
provide exposure to a wide spectrum of asset classes worldwide.
The Sub-fund intends to have a dynamic asset allocation to capture return mainly from equity and fixed
income, provided that the Sub-fund, under normal market conditions, aims to maintain 60% of its
portfolio in investments that provide an exposure to equity (having the “MSCI AC World Daily TR Net
USD - NDUEACWF Index” as an indicative benchmark) and 40% of its portfolio in investments that
provide an exposure to fixed income (having the “JPM Global Aggregate Bond Index - Total Return
Unhedged USD – JGAGGUSD Index” as an indicative benchmark).
INVESTMENT POLICY
The Sub-fund may invest up to 100% of its net assets in units/shares of UCITS, provided that no more
than 20% of the Sub-fund’s net assets be invested in aggregate in units/shares of the same UCITS and no
more than 10% of such UCITS’ net assets be invested in aggregate in units/shares of other UCITS.
Investments made in units/shares of ETFs that are UCIs other than UCITS may not exceed, in aggregate,
30% of the net assets of the Sub-fund.
The Sub-fund is permitted to invest up to 10% of its net assets in units/shares of the same closed ended
ETF that qualifies as a transferable security.
The Sub-fund is permitted to invest up to 10% of its net assets in equities or securities of the same issuer.
In addition, the Sub-fund may invest in aggregate up to 20% of its assets in transferable securities and
money market instruments with the same group, as determined by item 7(f) of section “Risk
diversification” of Appendix A. For the avoidance of doubt, the Sub-fund will not use any other of the
exceptions listed under the referred section “Risk diversification” of Appendix A with respect to
investments within the same issuer and with respect to investments in transferable securities and money
market instruments with the same group. In addition, the total value invested in securities of issuers that
represent - for each issuer - more than 5% of the assets of the Sub-fund should not exceed 40% of such
net assets.
The Sub-fund intends to have a dynamic asset allocation among a range of asset classes in a flexible way
to capture return from equity, fixed income and other sources. Furthermore, the Sub-fund may have
exposure via UCITS and UCIs, including open ended and closed ended ETFs, to commodities and real
estate investments.
There may be occasions of adverse market conditions in which the Investment Manager will wish to hold
significant positions in cash or near cash instruments. Cash may be held at, and cash instruments may
include those issued by affiliates of the Investment Manager.
For the purpose of efficient portfolio management and in order to dynamise/secure the portfolio, the
Sub-fund may employ techniques and instruments relating to transferable securities or techniques and
instruments aimed at hedging.
- 77 -
Profile of the Typical
Investor
As a result of the volatility of the global markets, the Sub-fund is only
suitable for investors seeking to achieve long-term capital growth of
principal and income.
Attention of prospective investors is drawn to the fact that the Board of
Directors could decide that investors from certain countries will not be
accepted in the Sub-fund. The excluded countries (if any) are listed in
the Subscription Form.
Risk Factors
The Sub-fund may invest in transferable securities denominated in
local currencies, and may hold cash in such currencies. Therefore,
currency fluctuations of such currencies vis-à-vis the USD may
influence the value of the Sub-fund.
Generally, investments in emerging market countries involve greater
risks due to the lack of an appropriate system for the transfer, price
calculation and accounting of the transferable securities and to their
custody and record keeping.
No guarantee or representation is made that the underlying funds’
investment programs will be successful, that the underlying funds or
the Sub-fund will achieve any targeted returns or that there will be any
return on (or of) any amounts invested, and investment results may
vary substantially over time. In addition, investments made by the
Sub-fund in the underlying funds, which may include funds managed
by the Investment Manager or by its affiliates, are subject to costs and
fees charged by the underlying funds, including but not limited to
portfolio management fees.
Although the Sub-fund will attempt to hedge its exposure to specific
positions, it will not always be possible to fully hedge risk from such
positions or any other position. In addition, the Sub-fund may take
positions based on the expected future direction of the markets without
fully hedging the market risks.
There is no guarantee of a secondary market for the investments of the
Sub-fund and thus there is a risk of delay if the Sub-fund receives a
large and unexpected demand for redemption. Investment in the
Sub-fund should be regarded as suitable only for Shareholders that
understand the risks involved. Investment in the Sub-fund should be
regarded as long term in nature. Prospective investors should satisfy
themselves about the risks, taking independent advice, as they deem
appropriate before proceeding.
Global Exposure Calculation
Methodology
The global exposure will be calculated by using the commitment
approach.
Reference Currency
USD
Benchmarks
60% MSCI AC World Daily TR Net USD (NDUEACWF Index ) and
40%JPM Global Aggregate Bond Index - Total Return Unhedged
USD (JGAGGUSD Index)
- 78 -
Classes
Class A Shares are available for all investors.
Class Y Shares are reserved to Institutional Investors who have a
specific agreement or partnership with the Investment Manager or any
entity of the Itaú Group authorising investment in Class Y Shares.
Distribution Policy
Class A: accumulating shares
Class Y: accumulating shares
Initial Subscription Period
Class A: to be determined by the Board of Directors
Class Y: to be determined by the Board of Directors
Initial Price
Class A: USD 100.Class Y: USD 100.-
Minimum Initial Investment
None
Minimum Subsequent
Investment
None
Minimum Holding Amount
None
Minimum Redemption
Amount
None
Minimum Conversion
Amount
None
Subscription Commission
Class A: up to 5% of the Net Asset Value per Share
Class Y: None
Redemption Commission
None
Conversion Commission
None
Investment Management Fee
Class A: 1.3% per annum of the Net Asset Value
Class Y: 0.10% per annum of the Net Asset Value
Maximum Level of
Management Fees Charged
both to the Sub-fund and to
the UCITS and Other UCIs
Class A: 2.55%
Class Y: 1.35%
- 79 -
Custody Fees
Fees are divided into two categories for each market of investment:
Safekeeping fee: annual fee billed and payable monthly based on the
value of the month end assets up to 0.35%.
Transaction fee: a per trade cost up to USD 135.-
Central Administration Fees
Up to 0.05% per annum of the Net Asset Value, provided that a certain
minimum fee may apply.
Global Distribution Fees
Class A: up to 0.25% per annum of the Net Asset Value
Class Y: None
Valuation Day
Every Business Day
Business Day
Any full working business day in Luxembourg, Dublin and New York
when the banks are open for business. For the avoidance of doubt,
half-closed bank business days in Luxembourg and Dublin (such as 24
December) are considered as being closed for business.
Sub-fund Subscription
Deadline
5:00 p.m. CET
Sub-fund Conversion
Deadline
5:00 p.m. CET
Sub-fund Redemption
Deadline
5:00 p.m. CET
Investment Manager
Itaú USA Asset Management Inc.
- 80 -
ITAÚ FUNDS –
AGGRESSIVE GROWTH FUND
INVESTMENT OBJECTIVES
The investment objective of the Sub-fund is to achieve long-term aggressive capital appreciation through
diversified investments primarily in units/shares of UCITS and other UCIs, including ETFs that provide
exposure to a wide spectrum of asset classes worldwide.
The Sub-fund intends to have a dynamic asset allocation to capture return mainly from equity and fixed
income, provided that the Sub-fund, under normal market conditions, aims to maintain 80% of its
portfolio in investments that provide an exposure to equity (having the “MSCI AC World Daily TR Net
USD - NDUEACWF Index” as an indicative benchmark) and 20% of its portfolio in investments that
provide an exposure to fixed income (having the “JPM Global Aggregate Bond Index - Total Return
Unhedged USD - JGAGGUSD Index” as an indicative benchmark).
INVESTMENT POLICY
The Sub-fund may invest up to 100% of its net assets in units/shares of UCITS, provided that no more
than 20% of the Sub-fund’s net assets be invested in aggregate in units/shares of the same UCITS and no
more than 10% of such UCITS’ net assets be invested in aggregate in units/shares of other UCITS.
Investments made in units/shares of ETFs that are UCIs other than UCITS may not exceed, in aggregate,
30% of the net assets of the Sub-fund.
The Sub-fund is permitted to invest up to 10% of its net assets in units/shares of the same closed ended
ETF that qualifies as a transferable security.
The Sub-fund is permitted to invest up to 10% of its net assets in equities or securities of the same issuer.
In addition, the Sub-fund may invest in aggregate up to 20% of its assets in transferable securities and
money market instruments with the same group, as determined by item 7(f) of section “Risk
diversification” of Appendix A. For the avoidance of doubt, the Sub-fund will not use any other of the
exceptions listed under the referred section “Risk diversification” of Appendix A with respect to
investments within the same issuer and with respect to investments in transferable securities and money
market instruments with the same group. In addition, the total value invested in securities of issuers that
represent - for each issuer - more than 5% of the assets of the Sub-fund should not exceed 40% of such
net assets.
The Sub-fund intends to have a dynamic asset allocation among a range of asset classes in a flexible way
to capture return from equity, fixed income and other sources. Furthermore, the Sub-fund may have
exposure via UCITS and UCIs, including open ended and closed ended ETFs, to commodities and real
estate investments.
There may be occasions of adverse market conditions in which the Investment Manager will wish to hold
significant positions in cash or near cash instruments. Cash may be held at, and cash instruments may
include those issued by affiliates of the Investment Manager.
For the purpose of efficient portfolio management and in order to dynamise/secure the portfolio, the
Sub-fund may employ techniques and instruments relating to transferable securities or techniques and
instruments aimed at hedging.
- 81 -
Profile of the Typical
Investor
As a result of the volatility of the global markets, the Sub-fund is only
suitable for investors seeking to benefit from long-term growth
opportunities.
Attention of prospective investors is drawn to the fact that the Board of
Directors could decide that investors from certain countries will not be
accepted in the Sub-fund. The excluded countries (if any) are listed in
the Subscription Form.
Risk Factors
The Sub-fund may invest in transferable securities denominated in
local currencies, and may hold cash in such currencies. Therefore,
currency fluctuations of such currencies vis-à-vis the USD may
influence the value of the Sub-fund.
Generally, investments in emerging market countries involve greater
risks due to the lack of an appropriate system for the transfer, price
calculation and accounting of the transferable securities and to their
custody and record keeping.
No guarantee or representation is made that the underlying funds’
investment programs will be successful, that the underlying funds or
the Sub-fund will achieve any targeted returns or that there will be any
return on (or of) any amounts invested, and investment results may
vary substantially over time. In addition, investments made by the
Sub-fund in the underlying funds, which may include funds managed
by the Investment Manager or by its affiliates, are subject to costs and
fees charged by the underlying funds, including but not limited to
portfolio management fees.
Although the Sub-fund will attempt to hedge its exposure to specific
positions, it will not always be possible to fully hedge risk from such
positions or any other position. In addition, the Sub-fund may take
positions based on the expected future direction of the markets without
fully hedging the market risks.
There is no guarantee of a secondary market for the investments of the
Sub-fund and thus there is a risk of delay if the Sub-fund receives a
large and unexpected demand for redemption. Investment in the
Sub-fund should be regarded as suitable only for Shareholders that
understand the risks involved. Investment in the Sub-fund should be
regarded as long term in nature. Prospective investors should satisfy
themselves about the risks, taking independent advice, as they deem
appropriate before proceeding.
Global Exposure Calculation
Methodology
The global exposure will be calculated by using the commitment
approach.
Reference Currency
USD
Benchmarks
80% MSCI AC World Daily TR Net USD (NDUEACWF Index ) and
20% JPM Global Aggregate Bond Index - Total Return Unhedged
USD (JGAGGUSD Index)
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Classes
Class A Shares are available for all investors.
Class Y Shares are reserved to Institutional Investors who have a
specific agreement or partnership with the Investment Manager or any
entity of the Itaú Group authorising investment in Class Y Shares.
Distribution Policy
Class A: accumulating shares
Class Y: accumulating shares
Initial Subscription Period
Class A: to be determined by the Board of Directors
Class Y: to be determined by the Board of Directors
Initial Price
Class A: USD 100.Class Y: USD 100.-
Minimum Initial Investment
None
Minimum Subsequent
Investment
None
Minimum Holding Amount
None
Minimum Redemption
Amount
None
Minimum Conversion
Amount
None
Subscription Commission
Class A: up to 5% of the Net Asset Value per Share
Class Y: None
Redemption Commission
None
Conversion Commission
None
Investment Management Fee
Class A: 1.4% per annum of the Net Asset Value
Class Y: 0.10% per annum of the Net Asset Value
Maximum Level of
Management Fees Charged
both to the Sub-fund and to
the UCITS and Other UCIs
Class A: 2.65%
Class Y: 1.35%
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Custody Fees
Fees are divided into two categories for each market of investment:
Safekeeping fee: annual fee billed and payable monthly based on the
value of the month end assets up to 0.35%.
Transaction fee: a per trade cost up to USD 135.-
Central Administration Fees
Up to 0.05% per annum of the Net Asset Value, provided that a certain
minimum fee may apply.
Global Distribution Fees
Class A: up to 0.25% per annum of the Net Asset Value
Class Y: None
Valuation Day
Every Business Day
Business Day
Any full working business day in Luxembourg, Dublin and New York
when the banks are open for business. For the avoidance of doubt,
half-closed bank business days in Luxembourg and Dublin (such as 24
December) are considered as being closed for business.
Sub-fund Subscription
Deadline
5:00 p.m. CET
Sub-fund Conversion
Deadline
5:00 p.m. CET
Sub-fund Redemption
Deadline
5:00 p.m. CET
Investment Manager
Itaú USA Asset Management Inc.
20886219.24.BUSINESS
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ADDITIONAL INFORMATION FOR INVESTORS IN THE FEDERAL REPUBLIC OF
GERMANY
The offering of the shares of Itaú Funds – Latin America Ex-Brazil Equity Fund, Itaú Funds –
Conservative Fund, Itaú Funds – Moderate Fund, Itaú Funds – Growth Fund and Itaú Funds –
Agressive Growth Fund has not been notified to the German Financial Services Supervisory
Authority in accordance with Section 310 of the German Investment Code (KAGB). Shares of
these sub-funds may not be offered to investors in the Federal Republic of Germany.
The distribution of the shares of the remaining sub-funds of the Company made available through the
Prospectus has been notified to the German Financial Supervisory Authority (Bundesanstalt für
Finanzdienstleistungsaufsicht - BaFin) according to Section 310 of the German Investment Code
(KAGB).
1. Information and Paying Agent in the Federal Republic of Germany
BNP Paribas Securities Services S.C.A. – Zweigniederlassung Frankfurt am Main
Europa-Allee 12
60327 Frankfurt
Bundesrepublik Deutschland
has undertaken the role of information and paying agent in the Federal Republic of Germany in
accordance with section 309 of the German Investment Code.
Conversion and redemption requests relating to the shares of the Company that are admitted to be
distributed in Germany can be addressed to the information and paying agent. Investors resident in the
Federal Republic of Germany can request that the redemption proceeds, possible dividends and other
payments due to them are paid through the information and paying agent. In this case the paying agent
will make the payments to an account designated by the investor or will make payments in cash.
The prospectus, the key investor information documents (Wesentliche Anlegerinformationen) relating to
the shares of the Company that are admitted to be distributed in Germany, copies of the Articles of
Incorporation and the annual and the semi-annual reports are available in paper form free of charge at the
offices of the information and paying agent. The documents available for inspection mentioned in the
prospectus under “23.1 Documents Available for Inspection” are available to view free of charge at the
offices of the information and paying agent. The latest subscription conversion and redemption prices as
well as Notices to investors are also available free of charge upon request at the offices of the information
and paying agent.
2. Publications
The subscription and redemption prices will be published on www.fondsweb.de. Notices to shareholders
will be published in the Federal Gazette (“Bundesanzeiger”).
The investors in Germany will be informed through a durable medium in the meaning of section 167 of
the Investment Code about:
1.
2.
3.
the suspension of the redemption of the units;
the termination of the management or liquidation of the Company or a sub fund;
changes to the Articles of Association of the Company that are incompatible with the existing
investment policies, that affect material investor rights or that affect the fees and reimbursement
of expenses that can be paid out of the assets of the fund;
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4.
5.
the merger of funds in the form of the information on the merger that is required to be prepared
according to article 43 of the Directive 2009/65/EC;
the conversion of an investment fund into a feeder fund or changes to a master fund in the form of
the information that are required to be prepared according to article 64 of the Directive
2009/65/EC.
3. Taxation
It is strongly recommended that investors seek professional advice concerning the tax consequences of
the purchase of the sub-funds’ shares prior to making an investment decision.
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