MACQUARIE CO-INVESTMENT FUNDadvisers.macquarie.com.au/retail/acrobat/mcif_prospectus.pdf ·...
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MACQUARIE CO-INVESTMENT FUND ISSUER: MACQUARIE INVESTMENT MANAGEMENT LIMITED ABN 66 002 867 003 AFS LICENCE NUMBER 237492 ARSN 113 983 574 PRODUCT DISCLOSURE STATEMENT Dated 16 May 2005
Transcript of MACQUARIE CO-INVESTMENT FUNDadvisers.macquarie.com.au/retail/acrobat/mcif_prospectus.pdf ·...
MACQUARIE CO-INVESTMENT FUND
ISSUER: MACQUARIE INVESTMENT MANAGEMENT LIMITED ABN 66 002 867 003AFS LICENCE NUMBER 237492
ARSN 113 983 574
PRODUCT DISCLOSURE STATEMENTDated 16 May 2005
SUPPLEMENTARY PRODUCT DISCLOSURE STATEMENT (SPDS) Issuer: Macquarie Investment Management Limited ABN 66 002 867 003 AFS Licence Number 237492 This SPDS, dated 24 June 2005, is supplemental to the Product Disclosure Statement (PDS) for the following Fund issued by Macquarie Investment Management Limited. The PDS and this SPDS should be read together. Fund ARSN PDS dated Macquarie Co-Investment Fund 113 983 574 16 May 2005 EXTENSION OF OFFER PERIOD All references in the PDS to the Offer Period ending on 24 June 2005 shall instead be read as references to the Offer Period ending on 29 July 2005. The information in this SPDS is general information only and does not take into account your individual objectives, financial situation or needs. You should consider whether the Fund is appropriate for you in light of your objectives and circumstances.
Investments in the Macquarie Co-Investment Fund (the Fund) are not deposits with or otherliabilities of Macquarie Bank Limited ABN 46 008 583 542 or of any Macquarie Bank Groupcompany and are subject to investment risk, including possible delays in repayment and loss ofincome and principal invested. Neither Macquarie Bank Limited nor any other member company ofthe Macquarie Bank Group guarantees the performance of the Fund or the repayment of capitalfrom the Fund.
Macquarie Investment Management Limited, as the issuer of this Product Disclosure Statement (PDS),invites you to invest in the the Fund. This offer is only open to persons receiving this PDS as a hard copyor electronically within Australia.
This PDS amounts to general advice only and has been prepared without taking into account anyinvestor's objectives, financial situation or needs. Investors should read the PDS carefully and assesswhether the information is appropriate for them in respect of their objectives, financial situation and needs.We encourage investors to talk to a financial adviser before making an investment decision.
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FUND FEATURES AT A GLANCE 4
MACQUARIE CO-INVESTMENT FUND - INVESTING DIRECTLY IN PRIVATE EQUITY INVESTMENTS 6
MACQUARIE’S INVESTMENT APPROACH FOR CO-INVESTMENTS AND DIRECT SECONDARIES 10
MACQUARIE - A PRIVATE EQUITY SPECIALIST 13
RISKS 15
IMPORTANT INFORMATION ABOUT THE OFFER 17
FEES AND OTHER COSTS 20
ADDITIONAL INFORMATION 26
DEFINED TERMS 32
HOW TO COMPLETE THE APPLICATION FORM 33
APPLICATION FORM 35
CONTACT DETAILS 39
CONTENTS
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This is only a summary. Investors should read the entire PDS before making an investment decision.
TOPIC SUMMARY PAGE NUMBER FORFURTHER DETAILS
Type of Fund Registered managed investment scheme. 27
Responsible Entity and Manager Macquarie Investment Management Limited. 13
Investment objective The Fund aims to provide returns in excess of the S&P/ASX 300 Accumulation Index, after the payment of fees and expenses, primarily through capital growthover the ten year term of investment from exposure to private equity co-investments in Australia and,where available, direct secondary investments primarily in Australia. 10-12
Types of investments The Fund will invest in the Wholesale Fund. The Wholesale Fund will invest in direct private equity investments alongside specialist private equity managers and direct secondaryinvestments. 6
Offer Period 16 May 2005 to 24 June 20051 17
Unit price $1.00 per unit 17-18
Minimum investment $20,000 payable in two instalments. Macquariereserves the right to reduce this minimum. 17-18
Initial instalment 50% of your investment payable on application. 18
Second instalment 50% of your investment. 18
Timing of second instalment First anniversary of the end of the Offer Period. 18
Target minimum andmaximum fund size $10 million2 and $40 million of total committed capital. 17-18
Term of investment 10 years3 18
Entry fee 3.3% of your committed capital, inclusive of GST4
deducted from application monies. 20
Base management fee 1.65%pa of committed capital less return of capital andany written off capital (inclusive of GST), payable quarterly in advance from Fund assets. 20, 22
1 These dates may be varied. We reserve the right to close the offer early or extend the closing date without prior notice.2 We reserve the right to reject applications and return application monies if total committed capital raised by the end of the offer period is less
than $10 million dollars.3 We have the ability to extend the term to up to twelve years to allow for effective realisation of any remaining underlying investments.4 Your adviser may receive an upfront commission paid out of the entry fee of up to 3.3% of your committed capital, inclusive of GST.
FUND FEATURES AT A GLANCE
TOPIC SUMMARY PAGE NUMBER FOR FURTHER DETAILS
Performance fee 20% of total returns once both capital drawn and a preferred internal rate of return of 10%pa on investedfunds have been distributed to investors. 20,22-24
Expense recoveries Expenses reasonably and properly incurred in operatingthe Fund may be recovered from the Fund. 20,22
Distributions Any realised gains and returns of capital from underlying investments will usually be distributed after the quarter in which the realisation occurs. At a minimum, the Fund will distribute any taxable income, including realised capital gains, that it receives for each financial year. Distributions may be uncertain and irregular. 19
Cooling off period If the Fund is not suitable for you, you may request redemption of your units during the fourteen day cooling off period. 28
Liquidity facility After the cooling off period, there is no right of redemption from the Fund. Investments in the Fund should be considered illiquid. 6
Level of risk High. The capital invested may be lost and may not produce income. 15,16
Tax A general description of the tax implications of investing in the Fund is provided in this PDS. We recommend that you obtain independent tax advice in relation to your particular circumstances. 26
Availability The Fund can be accessed directly by investors. It may also be available on wrap and master trust platforms. 17
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ABOUT THE FUNDThe Fund is a unit trust which pools the money ofretail investors and acquires units in the WholesaleFund. It will also hold some cash investments. TheWholesale Fund is a specialist investment vehicleformed for the purpose of making co-investments inAustralian unlisted companies and assets across arange of industries, and making direct secondaryinvestments, primarily in Australia, where available.
The Fund is closed ended. This means theopportunity to subscribe for units is limited to the OfferPeriod and no facility for redemption of your units isavailable during the term of the Fund, excepting thatyou can have your units redeemed during the fourteenday cooling off period. As your investment will beilliquid, you should carefully consider whether aninvestment in the Fund is appropriate for you.
Private equity is an alternative asset class that has thepotential to deliver long term returns that are superiorto those of traditional asset classes such as bonds,property and listed equities. However, private equity isriskier than these traditional asset classes andinvestors should consult their financial adviser beforemaking an allocation to this asset class.
WHAT IS A CO-INVESTMENT?Co-investments are where a private equity investor,such as Macquarie on behalf of the Wholesale Fund,invests directly alongside a specialist private equitymanager in particular private equity transactions. Thisusually occurs when private equity managers do nothave the capacity to finance large transactions ontheir own and approach other investors, with whomthey have a relationship, to take a direct stake. Thisprocess may lower the cost to investors of obtainingprivate equity exposure, when compared to investingindirectly through a fund of funds structure.
WHAT IS A DIRECT SECONDARY INVESTMENT?Direct secondaries are opportunities to acquireinvestments in unlisted companies from investorswishing to sell their stake in the company. Theseinvestments are usually acquired at a discount to theirtrue value, as the interests of the sellers are generallydifferent to those of an investor, such as Macquarie onbehalf of the Wholesale Fund, with an objective oflong term capital gains.
Our aim in making these investments is to deliverreturns to investors by eventually selling the stake ineach company or asset via a public offering or tradesale. If investments are successful, returns are likely tobe delivered by way of distributions of capital gainsrather than income.
MACQUARIE CO-INVESTMENTFUND - PROVIDES ACCESS TODIRECT PRIVATE EQUITYINVESTMENTSThe Fund gives investors the opportunity to access directprivate equity investments made alongside specialist managers.The Fund is managed by Macquarie.
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WHY INVEST IN PRIVATE EQUITY?Private equity is a broad term covering investmentsprimarily in unlisted companies and assets at variousstages of their development. The term is used todescribe investments ranging from start-up capital(also known as venture capital), later stagedevelopment capital as well as management buy-outs. While riskier than traditional listed equityinvesting, it is during these phases - before the assetsare taken to the public markets such as a listing onthe Australian Stock Exchange - that the highestreturns are often found.
The early stage, or venture capital, part of the privateequity landscape is probably the most well knownsector, referring to investments in companies that areat an embryonic stage of developing their business.Private equity investors fund those businesses toenable them to commercialise new technology, ideasor innovation. For example a number of successfultechnology companies including Compaq, Sun andApple in the US and ResMed, SirTex Medical andLooksmart in Australia were funded by venture capitalcompanies in their early years.
However, this is just one part of the wide range ofinvestments that can be considered private equity.Other areas include service and industrial companiesrequiring capital to expand, or when managementbuy-outs are used to revive a mature business.Recent examples in Australia include JB Hi-Fi, JustJeans, Bradken, Repco, Pacific Brands, andWizard Home Loans.
The companies named above are for illustrativepurposes only.
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TYPES OF PRIVATE EQUITYPrivate equity managers tend to specialise in investing at certain stages in a company's growth or in variousindustry segments. The main sectors of the private equity market that the Wholesale Fund will use to make itsinvestments are described in more detail in the table below.
PRIVATE EQUITY SECTOR
Buy-out capital
Expansion capital
Early stage or venture capital
DESCRIPTION OF SECTOR
Specialist buyout managers tendto invest in establishedbusinesses with reliable cashflows, low operational risk and astrong market position.
These managers often use debt tofund their purchases and put inplace new management structuresdesigned to grow the value of thecompanies5.
Expansion capital managers inprivate equity typically provideadditional capital to establishedcompanies that require funds andworking capital to expand theirproduct or service and reach theirpotential.
Expansion capital is provided tofirms at or near profitability to enablethem to take another step on theirexpansion path. Most of theseinvestments will be in industrial andservice companies.
Early stage or venture capitalmanagers, specialise in providingseed capital and have strengthsin assessing and commercialisingnew technologies.
These managers will typically beseeking to invest in a company inthe information technology,biosciences and materials sciencesareas and to use their expertise andnetworks to assist these companiesto grow substantially.
EXAMPLES OF INVESTMENTSIN EACH SECTOR
There have been a number of high profile buy-out transactionsin the Australian market over thelast five years.
These include Just Group a retailerof casual apparel, Pacific Brands amanufacturer of branded consumerstaples, B&D Doors a manufacturerof garage and other doors andframes, Austar a regional pay TVoperator, and Affinity Health,previously the private hospitalsdivision of Mayne Group.
Some examples of expansioncapital type investments in Australiainclude JB Hi-Fi, the now ASX listedretailer of audio visual equipment,Pumpkin Patch, the retailer ofchildren's apparel now listed on theNew Zealand stock exchange, TheReject Shop, a discount retailernow listed on the ASX and Austal, anow ASX listed Western Australiancompany that designs and buildshigh speed ferries and luxury yachts.
Some examples of early stageinvestments by Australian privateequity managers includeLooksmart, a pioneer in internetsearch engine technology,Pharmaxis a specialistpharmaceutical companydeveloping therapies for chronicrespiratory and auto-immunediseases, now listed on the ASX,Seek Limited, an internet jobsearch company now listed on theASX and Kinetic, the technologybehind a wide range of commerciallyavailable shock absorbers.
The companies named above are for illustrative purposes only.5 The Wholesale Fund will not engage in borrowing to fund co-investments.
THE ROLE OF SPECIALIST PRIVATE EQUITYMANAGERSMacquarie intends to source co-investmentopportunities through, and make co-investmentsalongside, specialist private equity managers withwhom we have on-going relationships.
Private equity managers invest by putting capital intoa business to finance the development of newproducts and services, the expansion of establishedproducts or changes to ownership and managementof a business.
Private equity managers generally provide their capital,in the form of equity, debt or a mix of both, inexchange for a sizeable stake in the business.However they also invest their expertise - inmanagement, finance, marketing, strategic directionand business and personal networks. By exercisingsome control through board representation andmanagement agreements, private equity investorsseek to protect and grow their investment6. Thisalignment of interests and the ability to add value tothe business often means that specialist private equitymanagers generate higher returns than those availablefrom traditional 'hands-off' investment in listed shares,although the risks involved are higher (see Risks onpage 15).
If successful in their investments, private equitymanagers typically deliver returns by way of capitalgains when they realise their investments through alisting on a stock exchange or by a sale to a tradebuyer.
The Wholesale Fund will seek to invest alongsidethese private equity managers in private equitytransactions.
6 While the specialist managers with whom we co-invest may seekand exercise such control, it is not Macquarie’s intention to do soon behalf of the Wholesale Fund’s investments.
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MACQUARIE’S INVESTMENTAPPROACH FOR CO-INVESTMENTS AND DIRECTSECONDARY INVESTMENTS
Portfolioconstruction
Dealorigination
Investmentselection
Monitoring andresearch
Establish desired portfolioallocation
Ensure appropriatediversification
Optimise portfolioconstruction
Source attractive dealsthrough relationships
Detailed due diligence toidentify risks
Manage risk/on-goingdue diligence
Maintain strong relationships withquality managers
Actively identify co-investment anddirect secondaries opportunities
Effective due diligence across anumber of broad factors
Identify risk factors and mitigants
Monitor investments
Ongoing market research
Assistance in identifyingappropriate exit options
PORTFOLIO INVESTMENT PROCESSOur investment process can be described as follows.
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The Fund aims to provide returns in excess of theS&P/ASX 300 Accumulation Index, after payment offees and expenses, primarily through capital growthover the 10 year term7 of investment, from exposure toprivate equity co-investments in Australia and, whereavailable, direct secondary investments primarily inAustralia.
In pursuit of this objective, the Fund will pool themoney of retail investors and acquire partly paid unitsin the Wholesale Fund. These units will be paid up to asmall proportion initially. The Fund will invest itsremaining cash in the Macquarie Treasury Fund (MTF).The Wholesale Fund will make further calls on thesepartly paid units as and when necessary to fund itsinvestments. The Fund will pay these calls from thecash held in the cash fund, which will be furthersupplemented when the Fund receives the second50% instalment of committed capital payable byinvestors in the Fund on the first anniversary of the endof the Offer Period.
The Wholesale Fund will originate private equityinvestment opportunities across the broad privateequity market, from buy-outs through expansion capitaland venture capital investments. These investments willbe sourced from over 15 private equity managers withwhom we have ongoing relationships.
7 We have the ability to extend the term to up to twelve years to allow for effective realisation of any remaining underlying investments.
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PORTFOLIO CONSTRUCTIONWe will structure the Wholesale Fund’s portfolio to ensure appropriate diversification across sector, stage andvintage (the year in which a specialist manager makes it investments). The indicative stage guidelines of theWholesale Fund and expected number of investments, once the Wholesale Fund is fully invested, are shown in thefollowing table8.
ALLOCATION GUIDELINES NUMBER OF INVESTMENTS
Buy-out stage 30-50% 3-6
Expansion stage 30-50% 4-8
Venture Capital stage 10-30% 4-108 Due to the illiquid nature of the investments, these indicative ranges are used as a guide to assist in diversification and are not strict limits.
The allocation ranges are based on dollars committed to investments.
ORIGINATIONWe will originate investments in a wide range ofindustries across a broad range of specialist privateequity managers. We maintain on-going relationshipswith over 15 private equity firms, which we expect willprovide the source of co-investment opportunities.
Co-investment opportunities usually occur whenprivate equity managers do not have the capacity tofinance large investments through their own funds andapproach other investors such as Macquarie, onbehalf of the Wholesale Fund, to take a direct stake inan investment.
Our relationships with private equity managers havedeveloped largely through investments made by ourprivate equity fund of funds vehicles in private equityfunds managed by these managers.
It is important to note that Macquarie makesindependent assessments whether to make co-investments. The specialist managers with whomwe may co-invest take no responsibility for ourinvestment decisions. A co-investment does not giverise to any partnership, joint venture or similar legalrelationship between the co-investors. The co-investors will each hold shares in the targetcompany independently of each other but allshareholders will typically be bound by a shareholderagreement.
The Wholesale Fund will have access to all co-investment opportunities generated by our privateequity team.
INITIAL INVESTMENT PERIODDuring the initial period of investment considerationand selection, the Fund will incur costs. As returns arenot yet being generated, the Fund may operate at aloss during this period. This situation would beexpected to reverse as investments are added to theFund.
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INVESTMENT CRITERIA FOR CO-INVESTMENTSWe will focus on a number key investment criteriawhen assessing potential co-investment opportunities:
Strong Management Skills. We believe the mostimportant factor in assessing private equityinvestments is the quality of the target company’smanagement team, particularly the CEO. While theprivate equity firm involved in originating theinvestment will spend considerable time assessingmanagement, we will also review management with aview to identifying the relative strength of themanagement team against peers in the company'sparticular industry and sector.
Recurring Revenue. We will prefer companies withstrong recurring revenue streams, rather than revenuegenerated from one-off sales.
Financial Analysis. We will assess the company'sability to generate future cash flow. We believe thatprimary research, through review and in-depth duediligence, is critical in identifying appropriateinvestment opportunities.
Market Leadership. We will target businesses thatare leaders in their particular market segment or thosewith a high likelihood of achieving leadership or nearleadership in the future.
Market Attractiveness. We will assess any proposedinvestment’s position relative to its suppliers andcustomers, the level of competition, market entry andexit barriers and regulatory risk.
Exit Alternatives. Emphasis will be placed on thequality and quantity of exit opportunities available forthe investment.
Pricing & Terms The pricing and terms of theinvestment will be compared to our assessment of theinvestment opportunity.
Quality of Co-Investor. Of paramount importance isthe quality of the co-investor. We will attempt to investalongside only those firms that are strongly regardedin their particular segment of the private equity market.
DIRECT SECONDARY INVESTMENTSDirect secondaries are opportunities to acquireinvestments in unlisted companies from disengagedor disenfranchised investors. These opportunitiesgenerally arise, owing to:
government and non-government institutionswishing to divest due to short-term cashrequirements;
founders and management that are no longerinvolved in the day-to-day management of thebusiness wishing to sell their stakes;
investors wishing to sell where there has been achange in their investment or corporate strategy,or
investors where regulatory change results in adesire or requirement to sell private equityinvestments (e.g. banks).
These investments are usually acquired at a discountto their true value, as the interests of the sellers aregenerally different to those of an investor, such as theWholesale Fund, with an objective of long-term capitalgains.
The Fund may complete international investmentsarising through acquisition of a portfolio of directsecondary investments. International investments willbe limited to less than 20% of the Fund’s net assets.
REALISATION OF INVESTMENTSWe will seek to exit investments held by theWholesale Fund, in conjunction with the lead privateequity manager when company progress and marketconditions are appropriate. The realisation of theseinvestments may be by way of initial public offering ona stock exchange, trade sale or sale to anotherprivate equity manager. Proceeds from any realisationwill be distributed to the Fund’s investors on aquarterly basis.
ABOUT MACQUARIEThe Fund is managed by Macquarie InvestmentManagement Limited, which is part of MacquarieFunds Management, a division of the Macquarie BankGroup.
Macquarie are a full service fund manager withexpertise in all major asset sectors and over 20 yearsfunds management experience. Our strong clientfocus, disciplined investment processes anddedication to innovation have established ourreputation as one of Australia's leading fundmanagers.
No member of the Macquarie Bank Group guaranteesthe performance of the Fund or the Wholesale Fundor the repayment of capital from the Fund or theWholesale Fund.
Macquarie currently manages or advises on,approximately $1.6 billion in private equity programsfor a wide range of institutional and retail clients.These private equity programs cover an investmentuniverse that spans Australian and international privateequity investments, including secondary investmentsand co-investments.
The Alternative Assets team within Macquarie willmanage the underlying portfolio of investments. Wewill also call upon the expertise of senior members ofthe broader funds management team in themanagement of the Fund, including in-housespecialists in accounting, legal, compliance and tax.
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MACQUARIE - A PRIVATE EQUITYSPECIALIST
Macquarie began managing private equity investments in 1996for the clients of our diversified funds. We currently manageprivate equity investment portfolios for a range of institutionaland retail clients. As at 31 March 2005, we managed, oradvised on, approximately $1.6bn of commitments to privateequity investments.
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TRACK RECORDMacquarie commenced managing private equity investments in 1996, initially for the clients of the diversified fundsestablished by Macquarie, through the Macquarie Select Opportunities Trust (SOT). We first raised institutionalcapital in 1998 with the launch of the Macquarie Alternative Investment Trust (MAIT). Since then, two further privateequity funds have been raised - MAIT II in 2001 and MAIT III in 2004. The track record of Macquarie’s private equityfunds is shown in the following table. Performance is compared to listed Australian equities.
TO 30 APRIL 2005 INCPT. 3 YRS 5 YRS 7YRS SINCE AUSTRALIANDATE % PA %PA %PA INCEPTION EQUITIES* SINCE
%PA INCEPTION %PAMAIT I9 02/98 24.2 13.3 - 15.8 9.6
MAIT II9 07/01 50.2 - - 39.1 8.6
SOT9 10/96 19.4 10.8 14.6 13.2 10.5
The table demonstrates Macquarie’s experience in managing private equity investment funds over a number ofyears. However, note that past performance10 of these funds is no indicator of likely future performance of the Fund.
Macquarie has completed twelve co-investments since 1996, investing approximately $13.5 million. Theseinvestments have generated $24.9 million in realised gains and $1.3 million in unrealised gains. The gross internalrate of return (IRR) on these investments is 42.6% per annum.
CAPITAL REALISED UNREALISED MULTIPLE GROSSTO 30 APRIL 2005 INVESTED PROCEEDS VALUE OF IRR
$M $M $M CAPITAL %PATOTAL CO-INVESTMENTS11 $13.5 $24.9 $1.3 1.9X 42.6%
THE POTENTIAL BENEFITS OF THE FUND INCLUDE:Access to expertise across a broad range of private equity sectors through specialist private equity managers.The Fund allows an investor to invest alongside specialist private equity managers across the broad range ofsectors of the private equity market, including management buy-outs, expansion capital and venture capital(including biotechnology and technology specialisations).
Access to Macquarie’s broad deal origination capability. By investing in the Fund, an investor can accessprivate equity transactions through our strong ongoing relationships with over 15 specialist private equitymanagers.
Ability to adjust strategy. The Fund will have a high degree of flexibility to adapt its investment strategy to thosesectors where we can identify undervalued investment opportunities.
Potentially lower management fees. By investing on a co-investment basis, the Fund may reduce the level ofmanagement fees payable by the investor in private equity when compared to investing indirectly through afund of funds structure.
Provision of management expertise. The Fund will benefit from Macquarie’s private equity expertise - we havebeen an investor in private equity markets since 1996.
9 Performance is reported after fees and expenses, but before tax. The Macquarie Alternative Investment Trusts (MAIT and MAIT II) are twoprivate equity investment funds managed on behalf of a range of institutional investors, mainly large superannuation funds. The performanceof MAIT and MAIT II reflect money weighted (or internal) rates of return based on the amount and timing of cash inflows and outflows of aninvestor in each of these funds, plus the unrealised value of their investments. The performance of the Macquarie Select Opportunities Trust(SOT) reflects time weighted returns including the unrealised value of investments. There can be no assurance that the unrealised investmentswill be realised at or above the value used in the above performance calculations. The performance of MAIT III is not shown as it does not yethave a performance history of at least twelve months. Source Macquarie Investment Management Limited. * S&P/ASX 300 AccumulationIndex. Source Datastream.
10 The performance history relates to funds which may have very different underlying investments to the Fund. In addition, market conditions mayhave changed significantly since the time at which the above funds made investments.
11 Based on the 12 private equity investments made by Macquarie alongside specialist managers since September 1996. This has involved$13.5 million of invested capital. Performance reflects a money weighted (or internal rate) of return incorporating the cash inflows and outflowsand the Manager’s valuation of investments with unrealised capital gains. After fees but before taxes. These co-investments have been madeintermittently over the period since September 1996 and do not represent a portfolio of assets but rather a series of transactions. For thisreason no annualised performance numbers for periods less than the since inception period (when the first co-investment was made) isshown. Source Macquarie Investment Management Limited.
There are risks associated with any investment.Generally, the higher the expected return on aninvestment, the higher the risk and the greater thevariability of returns. Macquarie's risk managementobjective is to deliver risk/return outcomes in line withour clients' expectations, however we cannot provideassurances or guarantees on future profitability andFund returns, distributions and return of capital.
This section provides a summary of some of the mainrisks associated with your investment. However,because of the diversity of the Fund's underlyingprivate equity investments which it will ultimatelyacquire, these risks cannot be exhaustivelycategorised. Investors should obtain independentfinancial and taxation advice before investing in theFund.
Given the nature of the Fund’s underlying investments,investors are advised to regard any investment in theFund as speculative.
Liquidity risk: Your investment is illiquid. Your capitalis committed for the long term. After the cooling offperiod, you cannot redeem your investment during theten year life of the Fund.
Generally, units are non-transferable. In any event, anytransfer of units requires our written consent. NeitherMacquarie or any of the Macquarie Bank Groupcompanies are required to facilitate the sale or transferof your units, although we may, at our discretion,assist with such sale or transfer.
Investment realisation risk: Unlike shares of publiclylisted companies, there is no ready secondary marketin which to sell the shares of private unlistedcompanies. The ability to generate liquidity within theFund depends on a number of factors, in particularthe state of the initial public offer market and the levelof corporate activity.
Early repayment risk: The Fund may sell all its assetsand return the proceeds to investors before the expiryof the investment term of the Fund. In this case thereturn on your investment may be diminished, andyou may not be able to reinvest into a similar yieldinginvestment.
Availability of investments: The success of the Funddepends on the availability of appropriate investmentopportunities, and the ability to identify and invest inunderlying co-investments. Should suitableinvestments not be available, the potential returnopportunity will be lost.
Performance risk: Neither Macquarie nor any of theMacquarie Bank Group companies guarantees youany level of return or repayment of capital from theinvestment. By its nature, private equity is high riskand some investments may fail, resulting in loss ofcapital. Past performance of previous private equityfunds cannot be taken as an indication of futureperformance of this Fund. Given the expectedtimeframe on realisation of investments, the Fund mayoperate at a loss with no distributions to investors inthe initial years of the investment or possibly longer.This may result in a net asset value of less than $1.00per unit.
In order to reduce performance risk, Macquarie’s aimwill be to invest in assets that exhibit a sustainablecompetitive advantage, add value to investmentsthrough active management and return funds toinvestors once investments have been successfullydivested. We also aim to invest across a range ofvintages and private equity types.
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RISKS
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Concentration risk: In certain circumstances, wemay concentrate investments in a small number ofinvestments. This concentration means that a lossarising in a single investment will cause aproportionally greater loss in the Fund than if a largernumber of investments were made.
Manager risk: The risk that Macquarie will notachieve its performance objectives or not producereturns that compare favourably against its peers.The performance of the Fund will depend significantlyupon the ability of the Manager to select profitableinvestments.
Market risk: Market risk relates to the state of listedmarkets vis-à-vis exit strategies for private equityinvestments. If investors are pessimistic about thecondition of the share market, they are less likely to beenthusiastic about taking up an initial public offering ofa private company, which in turn affects price andliquidity for private equity investments. It should benoted that an initial public offering is one of a numberof exit strategies for private equity managers.Management buy-outs and trade sales are othercommon strategies.
Forfeiture risk: If you do not pay the secondinstalment of your committed capital on the firstanniversary of the end of the Offer Period and theamount owed remains unpaid ten days after we havegiven you written notice of your default, you will forfeitall your units in the Fund.
Private equity sector risk: As an increasing numberof investors seek to gain exposure to the privateequity sector, so demand increases, and the price thathas to be paid for investments may also increase.This could potentially adversely affect the Fund'sperformance.
Valuation risk: The price ultimately realised whenexiting an investment may differ from the valueattributed to it prior to the sale. This variation invaluations is due to the nature of private equityinvestments, and may affect the performance of theFund.
Macquarie is reliant on information it receives fromexternal private equity managers regarding the valueof each underlying investment. Macquarie will use thisinformation to determine the net asset value of theFund. If this information is materially incorrect, or therealisable value of these investments is less than theexternal manager’s valuation, there is a risk that thevalue of the Fund could be adversely affected.
Currency risk: is the risk that fluctuations in exchangerates between the Australian dollar and foreigncurrencies may cause the value of the Fund'sinvestments to decline. The Fund will not hedge anyforeign currency exposure, however the Fund's non-Australian dollar denominated investments are limitedto 20% of the Fund's size.
Documentation Risk: is the risk that unlisted orstructured transactions are imperfectly executed orpoorly documented.
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The Fund is a closed-end fund with an objective ofraising between $10 and $40 million. The opportunityto subscribe for units is limited to the Offer Period.
Early applicants will be given preference in theallocation of units.
All units will have an initial value of $1.00 and will bepartly paid. The minimum commitment is A$20,000.We have the absolute discretion to accept or reject allor part of any applications received. If the totalcommitted capital raised by the end of the OfferPeriod is less than $10 million, we reserve the right toreject applications and return all application monies toinvestors without interest.
Investing in this Fund can be done in one of twoways, depending on whether you are an indirect ordirect investor. Investors should keep a copy of thecurrent Product Disclosure Statement and anysupplementary documents for future reference.Product Disclosure Statements are available from ourSydney office free of charge.
INDIRECT INVESTORSIf investing through a master trust or wrap account,you are known as an indirect investor. These are typesof "investor directed portfolio services", or IDPS, aninvestment or reporting service provided by anoperator. Other types of IDPS are some types ofnominee or custody services.
Investors gaining exposure to this Fund through amaster trust or wrap account are indirect investorsand do not themselves become investors in the Fund.Instead it is the operator of the master trust or wrapaccount that invests for you that has the rights of adirect investor, and they may choose to exercise theserights in accordance with their arrangements with you.
Indirect investors will need to complete the applicationform provided by the master trust or wrap accountoperator, and will receive reports and other informationfrom that operator. Any enquiries should be directedto them.
DIRECT INVESTORSTo invest directly, you need to complete theapplication form that accompanies this ProductDisclosure Statement and return it to us with yourinitial instalment. Initial instalments made directly mustbe for a minimum of $10,000 (being 50% of the$20,000 minimum committed capital) with theremaining $10,000 instalment payable on the firstanniversary of the end of the Offer Period.
APPLICATION PRICEThe initial application unit price will be $1.00. Calls ofthe unpaid amount will be made on the firstanniversary of the end of the Offer Period of the Fund.The end of the Offer Period is 24 June 2005 or asotherwise determined by Macquarie. Applications willbe accepted, at the application price, at Macquarie'sSydney office prior to 5pm Sydney time on thatbusiness day. Cheques and application formsreceived after the cut-off time may be accepted atMacquarie’s discretion or will be returned to theinvestor. The Fund will initially invest drawn capital inthe MTF until called by the Wholesale Fund.
Payments can be made by cheque, real time grosssettlement (RTGS), Austraclear and bank transfer.Cheque payments should be made out to MIML - Macquarie Co-Investment Fund for(applicant's name).
ISSUE OF UNITSApplications for units will only be accepted byMacquarie at the end of the Offer Period if the targetminimum fund size of $10 million total committedcapital has been reached. If your application isaccepted in whole or in part, your units will be issuedon the last day of the Offer Period. Pending the issueof units, all application monies will be held in aseparate account.
The number of units issued will be calculated by firstdeducting the applicable entry fee from yourcommitted capital and then dividing the result by the$1.00 application price.
IMPORTANT INFORMATIONABOUT THE OFFERThe Fund is open to subscriptions for a limited period only until24 June 2005, unless extended by Macquarie and may closebefore 24 June 2005 should the Fund be oversubscribed.
UNIT PRICINGThe Fund’s unit price will vary to reflect the value of itsunits held in the Wholesale Fund and MTF. As thevalue of the underlying assets rises and falls, the unitprice of the Fund will also rise and fall correspondingly.If capital is called or returned to you the unit price willalso rise and fall correspondingly. We will report theunit price to you at least quarterly. The unit price isequal to the value of the Fund’s assets, less liabilitiesdivided by the number of units in issue. The Fund’sunit price will reflect the value of the underlyinginvestments and liquid assets held. These will bevalued by Macquarie at their fair value using avaluation method capable of being verifiedindependently by an expert valuer independent ofMacquarie. Notwithstanding the changing unit price,the units you hold in the Fund are illiquid (see Riskson page 15).
The unit prices are also published on our web site atwww.macquarie.com.au/au/corporations/managed_funds/unit_prices.dyn
WHEN ARE INSTALMENTS PAYABLE? The first instalment (being 50% of your committedcapital) is payable when you make your application.The second instalment (being the remaining 50% ofyour committed capital) is payable on the firstanniversary of the end of the Offer Period. We will giveyou at least 21 days written notice of the secondinstalment payment date and the amount of theinstalment. Please see below for information aboutdefaults.
WHAT HAPPENS IF YOU DO NOT PAY THESECOND INSTALMENT?We must receive payment of the entire secondinstalment by the instalment payment date specified inthe notice. If we do not receive your entire secondinstalment at our Sydney office prior to 5pm on thatdate, you will have committed a default in respect ofthat instalment.
If you default we may charge you default interest onthe full amount of the relevant instalment (even if youmade a part payment) at the default rate. The defaultrate is equal to the Bank Bill Rate plus 5% per annum.You will be given written notice of the default and 10days in which to remedy it. You will not be entitled toreceive distributions from the Fund or otherwise beentitled to exercise any rights such as voting rightsattached to your units until your default is remedied infull. Additionally, we may satisfy any amount owing byyou from distributions otherwise payable to you.
If after ten days of receiving notice of default, anyamount owed by you remains unpaid, you will forfeitall your units in the Fund and cease to have allentitlements and rights in respect of those units. Uponforfeiture, we may attempt to sell the units thatrepresent your investment in the Fund. We reserve theright to purchase those units but are not obliged to doso. If we do not, we will ordinarily accept the firstgenuine offer to purchase the forfeited units that wereceive after notifying you of the forfeiture. We will thenpay you the proceeds of sale (less any costs incurredin selling the forfeited units, any expenses incurred inconnection with the forfeiture and any action taken byus to recover unpaid calls, and payments of all calls,including interest).
In any case we will give you written notice of forfeiture.If an amount remains outstanding after forfeiture, youwill still be liable to pay us that amount includinginterest, while the amount remains outstanding, at theBank Bill Rate plus 5% per annum.
WINDING UPThe Fund is a closed-end fund. This means that
the Fund will terminate (wind up) after ten yearsand we will distribute realised capital and income,after fees and expenses, to investors inproportion to their unit holdings;
we reserve the right to extend the life of the Fundby two periods of one year each to allow foreffective realisation of remaining underlyinginvestments;
if an asset cannot be realised before the wind upof the Fund, it will be placed in a separate Fundfor liquidation;
if at the end of the Offer Period we have notreceived capital commitments of at least $10 million we have the right to return funds toyou without interest;
Macquarie, in its sole discretion, may elect at anytime to terminate the Fund on written notice toinvestors.
TRANSFER OF UNITS IN THE FUNDGenerally, units are non-transferable. In any event, anytransfer of units requires our written consent. NeitherMacquarie or any of the Macquarie Bank Groupcompanies are required to facilitate the sale or transferof your units, although we may, at our discretion assistwith such sale or transfer.
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DISTRIBUTIONSThe Fund may make distributions on a quarterly basisat the end of March, June, September and December.The possibility exists that in some years the Fund maynot make any distributions.
Distributions, if any, may comprise return of capital,realised capital gains, and/or income and will generallybe made when we receive distributions from the MTFand/or Wholesale Fund. Earnings from the WholesaleFund will be distributed to investors when privateequity investments either pay income to theWholesale Fund or are sold. Distributions may beuncertain, deferred and irregular. We reserve the rightto distribute at our discretion or retain distributions tomeet your instalment obligations. We will advise you inwriting if we do so. All distributions will be made inproportion to your paid-up capital.
Distributions from the Fund that are subject to tax aretaxable in the hands of unit holders in the year towhich they relate.
Distributions can only be made to an Australian bankaccount or a Macquarie Cash Management Trust(CMT) account and cannot be paid by cheque.
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FEES AND OTHER COSTS
This table shows fees and other costs that you may be charged. These fees and costs may be deducted from thereturns on your investment or from the Fund assets as a whole. Taxes are set out in the Taxation section of thisdocument. You should read all of the information about fees and costs, as it is important to understand theirimpact on your investment.
TYPE OF FEE OR COST AMOUNT HOW AND WHEN PAID
Fees when your money moves in or out of the FundEstablishment fee Nil Not applicable.This is the fee to set up your initial investment.
Contribution fee 3.3% of your Deducted from yourThis is the fee for the initial investment. committed capital, initial instalment and
inclusive of GST12 paid to your adviser (if any).($33 per $1,000 of The amount of this fee can committed capital.) be negotiated. See
Commission.
Withdrawal fee Nil Not applicable. This is the fee for each withdrawal you make.
Termination fee Nil Not applicable.This is the fee when you finally close yourinvestment.
Management costsAdministration costs are the fees Expenses reasonably and Payable as and whenand costs for operating the Fund. They include properly incurred in operating they arise, and are accruedadministration and other fees charged by the the Fund and the Wholesale Fund in the unit price of the fundproduct issuer, distribution costs and other may be recovered from the in which the expenseexpenses incurred in operating the Fund. respective fund’s assets. is incurred at the point we
It is not possible to estimate the become reasonably certainamount of expense recoveries. that the expense will be
incurred.
Investment costs are the fees and costs for Macquarie will be entitled to Accrued daily, reflected ininvesting in the assets. They include fees a base management fee paid unit price and paid charged by the product issuer, fees paid from Fund assets of 1.65%pa quarterly in advance.to external investment managers and other inclusive of GST of committed expenses incurred in investing the asset capital less return of capital and(excluding transaction costs). any written off capital ($16.50pa
per $1,000 of committed capital).
In addition Macquarie will be Paid when incurred fromentitled to receive a performance the proceeds of fee paid from Fund assets of 20% realisation of investments.inclusive of GST of total returns once both capital drawn and an internal rate of return (IRR) of 10%pa on invested funds have been distributed to investors.
The Wholesale Fund may pay from Payable as and when theyits assets to a private equity are invoiced.manager a fee for sourcing a co-investment. This may be in the form of a base management fee or performance fee. This fee is notincluded in Macquarie’s base management fee and performancefee described above.
12 This fee includes an amount payable to an adviser for advice about this product. See Commission.
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TYPE OF FEE OR COST AMOUNT HOW AND WHEN PAIDAdditional service fees13
Switching fee Nil Not applicable.This is the fee for when you switch betweeninvestment options.
Adviser service fee Nil Any amounts that you This is the fee for extra advice from your agree to pay your adviser adviser about your investment. (An adviser may for financial advice arealso be paid other amounts as commission separate to the fees weout of one or more of the fees listed above). charge in respect of your
investment in the Fund. Wemay pay amounts to thedealer group to which youradviser belongs. This is notan additional charge to youand it should be discussedwith your adviser or consultant (see Commission section).
All fees include the net impact of GST. 13 See Additional Services for special request fees.
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ADDITIONAL DISCLOSURE ITEMS
Entry feeThe maximum entry fee the Fund’s constitution allowsus to charge is 5% of your committed capital inclusiveof GST. The actual entry fee described in the fee tablewill not be increased during the term of yourinvestment.
Base management feeThe maximum base management fee the Fund’sconstitution allows us to charge is 5%pa inclusive ofGST of committed capital less return of capital orwritten off capital. The actual base management feedescribed in the fee table will not be increased duringthe term of your investment.
Investors should note that the level of committedcapital on which the 1.65%pa inclusive of GST basefee will be charged will be reduced on a quarterlybasis to reflect the amount of any capital returned toinvestors from previous distributions. As more capitalis returned to investors the level of base fee will dropaccordingly.
Expense recoveryUnder the Fund’s constitution we have the right torecover from the Fund all proper and reasonableexpenses, and are entitled to be indemnified from theFund for liabilities we properly incur in connection withthe Fund. These may include costs associated withconducting due diligence on potential investments aswell as certain extraordinary expenses, such asexpenses in relation to unit holder meetings. There isno limit on the amount of expense recoveries allowedunder the constitution.
Performance feeMacquarie will be entitled to receive a performancefee of 20% inclusive of GST of total realised returns.Macquarie will not start to recover any of thisperformance fee until all drawn down capital and aninternal rate of return (IRR) of 10% per annum oninvested funds has been distributed to investors.Above this level of return distributions will be shared50% to the investor, 50% to Macquarie untilMacquarie has been paid a performance fee equal to20% of total returns from the Fund. Once Macquariehas achieved its 20% share of total returns (i.e. atapproximately 16.6%per annum), any furtherdistributions will be paid 80% to investors and 20% toMacquarie by way of performance fee. The IRR is therate of discount which needs to be applied to makethe net present value of an investment equal to theprice paid. The IRR calculation is a performancecalculation that measures the amount of moneyinvested, the amount of money returned to investorsand the timing of these cashflows.
The performance fee will be paid only fromdistributions from the Fund, and is based on realisedinvestment returns. Performance fees will be payableunder the following mechanism.
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The following table shows a number of examples of the performance fee calculation.
Return 5%pa 10%pa 15%pa 20%pa 25%pa
Distribution Investor Manager Investor Manager Investor Manager Investor Manager Investor Managershare
Step 1 Capital Nil Capital Nil Capital Nil Capital Nil Capital NilCapital return returned returned returned returned returnedto be paidto investor
Step 2 5% Nil 10% Nil 10% Nil 10% Nil 10% NilUp to 10%IRR to be paidto investor
Step 3 n/a n/a n/a n/a 2.5% 2.5% 3.3% 3.3% 3.3% 3.3%From 10% to16.6% IRR(50% catchuppaid to Macquarie)
Step 4 n/a n/a n/a n/a n/a n/a 2.7% 0.7% 6.7% 1.7%Greater than16.6% IRR(20% paid toMacquarie)
Total investor 5% Nil 10% Nil 12.5% 2.5% 16% 4% 20% 5%return andperformance fee paid to Macquarie
The performance fees referred to above are inclusive of GST.
Step 1 Distributions since inception of the Fund equalto paid-in capital are paid entirely to the investor. Noperformance fee is payable to the Manager.
Step 2 Distributions totalling an internal rate of returnof 10% per annum on paid-in capital will be paid toinvestors. No performance fee will be payable to theManager.
Step 3 Distribution returned once all drawn downcapital and the 10% preferred internal rate of returnhas been paid will be shared 50% to the investor,50% to Macquarie until Macquarie has been paid aperformance fee equal to 20% of total returns fromthe Fund. For example, if the Fund were to achieve a15% internal rate of return, 2.5% would be paid inperformance fees to Macquarie and 2.5% will be paidto investors, in addition to the 10% per annumpreviously paid to the investor under Step 2.
Step 4 Once Macquarie has achieved its 20% shareof total returns (i.e. at approximately 16.6%perannum), any further distributions will be paid 80% toinvestors and 20% to Macquarie by way ofperformance fee.
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Payment of base management fee andperformance fee on removal of Responsible EntityIf Macquarie is removed as responsible entity of theFund in circumstances where Macquarie is not indefault of its obligations under the constitution,Macquarie is entitled to a break fee payment from theFund equal to the amount of the base managementfee calculated for the calendar quarter immediatelyproceeding the calendar quarter in which Macquariewas removed, annualised and paid for a one yearperiod commencing on the actual date of removal andending on the first anniversary of that date. The breakfee must be paid from the Fund on the date ofremoval.
If removed in these circumstances, Macquarie is alsoentitled to a performance fee (as described inPerformance fee) calculated by the Fund’s auditor asif the Fund’s assets were disposed of on the date ofremoval of Macquarie as responsible entity anddistributed to unitholders on that date, after deductingthe performance fee.
TOTAL DOLLAR FEE ON $20,000 INVESTMENTFees payable
Contribution fee Up to $660Annual feesBase management fee $330Performance fee (assuming 15%pa IRR) $500Total annual fee $830
This is an illustration only. The base management feeassumes no capital has been returned to investors orbeen written off.
ADDITIONAL SERVICESWe can charge for additional services such as payingwithdrawal proceeds by bank cheque, telegraphictransfer or real time gross settlement (RTGS), dealingwith overseas bank drafts and providing replacementstatements. At the time of this PDS, the followingcharges apply
Service Fee (inclusive of GST, if applicable)
Bank cheque $7.50Telegraphic transfer $35.00 if the account
transfer is domiciled in Australia and $31.82 if domiciled overseas
RTGS $5.00 for transactions up to $500,000 and free for transactions of $500,000 and above
Overseas bank draft $15.00Dishonoured cheques $12.00 (for applications)
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COMMISSIONIf a licensed or appropriately authorised financialadviser or registered broker introduces you to theFund, they may be entitled to receive an upfrontcommission (representing the contribution fee) of upto 3.30% inclusive of GST of your committed capitalin the Fund. Advisers may forgo this fee in whole or inpart by indicating appropriately on the applicationform. If you do not have a financial adviser these feeswill not be rebated to the investor.
We may pay other amounts to the dealer group towhich your adviser belongs. These are not anadditional charge to you and should be discussedwith your adviser or consultant.
We may pay fees to the operators of some mastertrusts and wrap accounts that offer the Fund on theirinvestment menus. We may also provide resources formarketing and product support to the master trust orwrap account. This is not an additional charge to youfor investing in the Fund.
In addition to any commission we may pay to youradviser, we may also provide non-monetary benefitssuch as business and technical support, professionaldevelopment and entertainment. The provision ofsuch benefits is governed by our Soft Dollar Policy,which is available on request from Client Service (seeContact details). Pursuant to that policy, we maintaina register of alternative remuneration, which is alsoavailable on request.
It is not possible to provide an estimate of thesepayments.
OTHER FEE ARRANGEMENTSIn some instances we may negotiate a lower level ofmanagement or performance fees, or the provision ofa rebate, with what the Corporations Act calls‘wholesale’ investors such as master trusts and wrapaccounts. This is generally because they invest verylarge amounts of money in the Fund. Where thisoccurs, neither the Fund nor any other investors areadversely affected. We are not permitted to enter intoindividual fee arrangements with retail investors.
INVESTING FOR THE FUNDIn the execution of transactions, we may deal withprofessional organisations that may include MacquarieBank Limited or its associated companies. We canalso trade the Fund's investments with MacquarieBank Limited or associated companies where webelieve the investments are in the best interest ofinvestors. Macquarie Bank Limited may deal asprincipal or on behalf of the Fund, however alltransactions are conducted at arm's length.
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REPORTING - CONFIRMATION OFTRANSACTIONS AND HOW WE KEEP YOUINFORMEDIt is important the you know exactly what ishappening with your investment. To help keep youinformed we send you:
Indirect investorsThe master trust or wrap account operator providesindirect investors with reports on the progress of theFund.
Direct investorsTransaction confirmations - you will receive confirmation of your initial investment as well as the second instalment.
Quarterly reports - you will receive a quarterlyvaluation statement and a report at the end ofeach quarter giving an update on the Fund andits investments;
Tax Statements - you will receive a tax statement at the end of the financial year; and
Annual report - you will receive an annual reportwhich shows the financial position andperformance of the Fund over the last financialyear.
The Fund may also be subject to regular reportingand disclosure obligations as a disclosing entity underthe Corporations Act. Copies of documents that welodge with ASIC to meet these requirements may beobtained from or inspected at an ASIC office or bycontacting us.
If you would like more information on the Fund pleasespeak to your financial advisor. Alternatively you cancall Macquarie Funds Management Client Service on1800 814 523.
ETHICAL INVESTMENTS POLICYGenerally and in normal circumstances, ourinvestment decisions for the Fund and the WholesaleFund do not take into account labour standards andenvironmental, social or ethical considerations.However these considerations may be taken intoaccount if they have the potential to materially affectthe value of the investment, but no specificmethodology is applied.
TAXATIONThere are tax implications that apply when investing inthe Fund. We recommend that you consult your taxadviser about your tax position. At the Fund's tax yearend we will send to you details of any assessableincome, capital gains and any other relevant tax andaccounting information to include in your tax return.
Under normal circumstances, the Fund does not payincome tax because the net taxable income isdistributed to investors. Income earned in this Fund,whether distributed or reinvested, forms part of yourassessable income in the year of entitlement.
Capital gains taxYour assessable income for each year may includenet capital gains (ie - after offsetting capital losses).
Tax deferred income/ return of capitalSome of the income distributed to investors is treatedas tax deferred income or return of capital, and is nottaxable to investors upon distribution. Tax deferredand return of capital income is not taxed as incomebut may increase the capital gain or reduce the capitalloss upon disposal of your units.
Franked dividendsThe Fund may generate franking credits throughdividend imputation. You will be advised of frankingcredits attached to the distribution along with allrelevant tax and accounting information after theFund's tax year end.
ADDITIONAL INFORMATION
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Non-resident taxationDeductions of Australian withholding tax and non-resident income tax will be made fromdistributions of Australian sourced taxable income forinvestors with an overseas address, or for non-resident investors temporarily residing in Australia.
Foreign tax creditsAustralian residents are required to include in theirassessable income their share of any foreign taxespaid by the Fund. Investors will normally be entitled toa tax credit in respect of the foreign taxes paid by theFund.
Tax file number (TFN) and Australian businessnumber (ABN)It is not compulsory to provide your TFN or ABN andit is not an offence if you decline to provide them.However tax will be deducted from your income at thehighest marginal rate plus Medicare levy if you do notprovide them or an exemption. These numbers canbe provided on the application form when making aninitial investment.
Good and services taxThe Fund has registered for GST. The issue andredemption of units in the Fund and receipt ofdistributions will not be subject to GST, however GSTis payable on our fees and reimbursement ofexpenses. The Fund will generally be able to claiminput tax credits and/or reduced input tax credits of atleast 75%.
MANAGED INVESTMENT SCHEMESThe Fund is a registered managed investmentscheme within the meaning of section 9 of theCorporations Act 2001. As such, the scheme and itsResponsible Entity, Macquarie, must comply with therequirements of Chapter 5C of the Corporations Act.
RESPONSIBLE ENTITYA Responsible Entity must be a public companyholding an Australian Financial Services Licence(AFSL) authorising it to operate a managed investmentscheme. The Responsible Entity for the Fund isMacquarie which holds an AFSL authorising it to actas a Responsible Entity. The role of the ResponsibleEntity includes:
Holding scheme property on trust for theuntiholders;
Managing and investing scheme property; and
Ensuring scheme property is managed and dealtwith in accordance with the scheme'sconstitution and the Corporations Act.
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COOLING OFF PERIODIf you are a direct investor and you decide that yourinvestment in this Fund is not suitable, you canrequest in writing or electronically to have it cancelledwithin the 14 day cooling off period. The cooling offperiod begins when your transaction confirmation isreceived by you or five days after your units areissued, whichever is earlier.
If you request redemption of your units during thecooling off period, your redemption value will equal theamount paid by you on application for your units,including any entry fee paid. This will be paid withinthirty days of receiving your redemption request.
The cooling off right only applies if you are a retailinvestor under the Corporations Act. It does not applyif you are a wholesale investor.
If you are an indirect investor, you should refer to yourIDPS operator for any cooling off rights.
THE CONSTITUTIONWhen you want to know your rights as a unitholder,the first place to look is the constitution of the Fund.
The constitution is affected by the Corporations Act,exemptions and declarations issued by the ASIC andthe general law relating to trusts.
As the Responsible Entity of the Fund, Macquariedecides which investments are bought and sold andholds the Fund's assets (including investments), eitherdirectly or through custodians or registry systems. Theconstitution:
Allows us or unit holders to call meetings of unitholders;
Provides for us to retire or be removed in certaincircumstances;
Gives us the right to terminate the Fund bynotice to unit holders and then to sell the Fundinvestments, pay expenses and pay unit holderstheir share of net proceeds if any;
Allows us to vary the constitution subject to unitholders' approval by special resolution if theamendment may affect unit holders' rightsadversely; and
Subject to law, limits our liability for acts oromissions in performing our duties or functionsas Responsible Entity of the Fund if we actproperly and in good faith.
The constitution does not contain all the matterswhich may affect unit holders, as these are providedfor in the Corporations Act. Some of the mattersaffecting unitholders which are not set out in theconstitution but are contained in the Corporations Actinclude:
Procedures for running meetings of unit holders;
Maintenance of the Fund's register of unitholders;
Specific duties of the Responsible Entity and itsofficers;
Auditing of the Fund; and
The keeping of accounting and other financialrecords of the Fund.
The Wholesale Fund's constitution is in a similar formto the Fund's constitution.
Copies of the constitution of the Fund and theWholesale Fund are available free of charge onrequest. To obtain a copy, please phone us on 1800 814 523.
YOUR LIABILITYSubject to the provisions regarding forfeiture of unitsand unpaid amounts, the constitution for the Fundlimits your liability to the amount subscribed, oragreed to be subscribed, by the investor for units.Recourse of the responsibility entity and Fundcreditors is limited to Fund assets. However, wecannot give you an absolute assurance about yourliability because the issue has not been finallydetermined by the superior courts.
COMPLIANCE PLANWe have prepared and lodged with the ASIC acompliance plan which must be audited annually. Thecompliance plan describes procedures that we applyin operating the Fund to ensure compliance with theCorporations Act and the scheme's constitution. Theminimum procedures which are incorporated in thecompliance plan include;
Ensuring Fund property is clearly identified andheld separately from other assets of thecustodian and Macquarie;
The proper operation of the compliancecommittee;
The valuation of Fund property;
The annual auditing of the compliance plan; and
Keeping adequate records of the operation of theFund.
The Wholesale Fund's compliance plan also dealswith the matters set out above.
Copies of the compliance plan of the Fund and theWholesale Fund are available free of charge onrequest. To obtain a copy please phone us on 1800 814 523
COMPLIANCE COMMITTEEWe have established a compliance committee with amajority of external members.
The Fund has a compliance plan that sets out howwe will ensure compliance with the Corporations Actand the Fund’s constitution.
The compliance committee’s role is to monitorcompliance with the compliance plan. It must alsoregularly assess the adequacy of the compliance planand report any breaches of the Corporations Act orthe Fund’s constitution to us. If we do not takeappropriate action to deal with a breach, thecompliance committee must report the breach toASIC.
THE CUSTODIANWe have appointed Bond Street Custodians Limited(BSCL) a Macquarie Bank Group company, to holdthe assets of the Fund. BSCL meets the requirementsprescribed by ASIC for custodians of managedinvestment scheme property.
We will monitor and review BSCL's procedures andsystems to ensure that custodial functions are carriedout efficiently and properly.
DECLARATIONS OF INTEREST IN THE FUNDThe only interest that Macquarie (including ourdirectors) has in the Fund, is in the fees to be receivedas Responsible Entity. However, it is open to any ofthe directors and Macquarie itself to become unitholders in the Fund.
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FUND PERFORMANCEAs the Fund is new, there is no meaningfulperformance history. In time, as fund performanceinformation becomes available, it can be obtainedfrom
your adviser
www.macquarie.com.au/au/corporations/managed_funds/performance.dyn
our Client Service team on 1800 814 523, 9am to 5pm, Monday to Friday
If investing through a master trust or wrap account,the net performance of your investment in the Fundmay be different from the information we publish dueto cash flows specific to your portfolio and any feescharged by the master trust or wrap account provider.
Past performance is not necessarily an indication offuture performance. Returns and values may bevolatile and may rise and fall significantly and quickly.
ENQUIRIES AND COMPLAINTS
Indirect investorsIf you are investing through a master trust or wrapaccount, contact the operator.
Direct investorsIf you are investing directly, enquiries can be madedirectly by calling 1800 814 523. Complaints can besent to
The Complaints Officer Macquarie Investment Management LimitedPO Box R1723, Royal Exchange NSW 1225
Our procedures ensure that we deal with complaintswithin 45 days of receipt.
We are a member of the Financial Industry ComplaintsService Limited ABN 64 068 901 904 (FICS), anexternal industry complaints resolution scheme. If youare not satisfied with the response from us, you cancontact FICS directly.
WE RESPECT YOUR PERSONAL DETAILS
Indirect investorsWe do not collect or hold your personal information inconnection with your investments in the Fund. Youshould contact your adviser for details on thecollection, storage and use of personal information.
Direct investorsCompleting the application form means that youagree to us collecting, holding and using yourpersonal information. We will use this information for:
providing or marketing products and services toyou;
administration purposes, including monitoring,auditing and evaluating the products andservices;
monitoring and auditing purposes;
determining future product and businessstrategies and to develop services, including themodelling of data and data testing;
ensuring compliance with all applicable regulatoryor legal requirements. This includes therequirements of ASIC, ASX, ATO, AUSTRAC andother regulatory bodies or relevant exchangesincluding the requirements of the superannuationlaw;
communicating with you in relation to yourholding and all transactions relating to theholding.
Your personal information may be disclosed to otherentities in the Macquarie Bank Group in carrying outthe above uses.
ABOUT THIS PRODUCT DISCLOSURESTATEMENTSome of the information in this PDS may change fromtime to time. We will issue a Supplementary PDS or areplacement PDS if there is a materially adversechange to information in this PDS or otherwise giveinvestors notice of the change. For other changes,you can obtain up to date information at any time by
calling Client Service on 1800 814 523, 9am to5pm, Monday to Friday
email at [email protected]
We will also send to you a copy of the updatedinformation free of charge on request.
Investors planning to access the Fund through amaster trust or wrap account, or directly throughMacquarie, may rely on this Product DisclosureStatement. We can provide electronic or paper copiesof this Product Disclosure Statement free on request.
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DEFINED TERMS
ASIC Australian Securities and Investments Commission
ASX Australian Stock Exchange Limited
Bank Bill Rate the three month base at call funding rate on bank loans andoverdrafts as set by Macquarie Bank Limited and adjustedperiodically.
Fund Macquarie Co-Investment Fund, a registered managed investment scheme.
Macquarie, MIML, Manager RE, Macquarie Investment Management LImited, the we, us or our responsible entity of the Fund. MIML is a wholly owned subsidiary
of MBL.
Macquarie Bank Group refers to Macquarie Bank Limited and its related bodies corporate (as that term is defined in the Corporations Act 2001).
MBL refers to Macquarie Bank Limited.
MTF Macquarie Treasury Fund ARSN 091 491 084, a wholesale cash fund or a similar style Macquarie cash fund. MTF is a registered managed investment scheme of which Macquarie is the responsible entity.
Offer Period period between 16 May 2005 and 24 June 2005, which may be extended by MIML, without prior notice, at its discretion.
Wholesale Fund Macquarie Wholesale Co-Investment Fund ARSN 113 983 305 a registered managed investment scheme of which Macquarie is the responsible entity.
You or your refers to an investor in the Fund.
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WHO CAN INVEST IN MACQUARIE CO-INVESTMENT FUND
individuals 18 years old and over;
companies;
incorporated bodies (eg. Strata bodies corporate,trade union); or
trustees of other entities (eg. Superannuationfunds).
For applications with three or more applicants, pleasecomplete and attach a copy of the application formwith the additional applicants’ details.
If you are making an investment on behalf of a child(i.e. acting as a trustee) you are required to quote atax file number or exemption reason to prevent taxbeing deducted from the investment income.
If you are making an investment on behalf of a minoror another entity, we require you to provide supportingdocumentation.
ADDRESSESWe have included a space for you to complete youraddress on the application form. Please note we arealso required to collect a residential address for you.
If your mailing address is care of a third party such asyour adviser, please be aware that all correspondencewill be sent to this address.
WHO SHOULD SIGN?The individual(s) in whose name the investment is heldshould sign. Joint applications will be deemed to beholding units in the Macquarie Co-Investment Fund asjoint tenants.
Company, Incorporated Association or BodyCorporate applications must be signed by:
two officers (e.g. two directors or a director andsecretary) or;
as required by the Constitution or rules of theCompany of Body (e.g. under seal witnessed bytwo officers), or;
signed by one director for a single directorcompany.
Additional documentation may also be required forapplications in the name of a Company, IncorporatedAssociation or Body. Please see page 34 for furtherdetails.
If you are signing under power of attorney pleaseprovide identification and attach a certified copy of thepower of attorney and specimen signature(s) of theattorney(s) if not displayed on the document. Acertified copy is a copy which is certified as being atrue and accurate copy of the original by a Justice ofthe Peace or a professional such as, a lawyer ordoctor.
FINANCIAL ADVISERS’ STAMPSIf a licensed or appropriately authorised financialadviser’s stamp appears on the application form wemay pay them commission (see page 25 for moredetail). We will also supply them with informationabout your investment unless you instruct us not todo so.
WHEN YOU COMPLETE THIS FORM, PLEASE:use a black pen
write in BLOCK LETTERS
answer all sections
sign the back page
Make cheque payable to:
‘MIML - Macquarie Co-Investment Fund A/C<Full account name>’eg ‘MIML - Macquarie Co-Investment Fund A/CJohn Citizen and Sample Citizen ATF CitizenSuper Fund’.
mail your cheque and application form to:
Macquarie Investment Management LimitedPO Box R1723, Royal Exchange, NSW 1225
If you make an error please do not use correctionfluid. Instead cross out your mistakes and initial youramendments.
HOW TO COMPLETE THEAPPLICATION FORM
34
MAKING AN INVESTMENT ON BEHALF OF OTHERSIf you are investing for... Documentation required: Your account must be in Complete
(to accompany the the name of application form application form) sections: (names are used
as examples only)
A superannuation fund Copy of an extract of the The trustees of the Individuals:trust deed identifying the superannuation fund* 1. Mary Citizen andparties to the trust 2. John Sample Citizen
4. Citizen SuperannuationFund
Companies:3. John Citizen Pty Ltd4. Citizen Pty Ltd
Superannuation Fund
A deceased estate A certified* copy of the The executors of the estate 1. Mary Citizengrant of probate or Letters 4. Estate of the late Agnesof Administration Sample
A trust Copy of an extract of the The trustees of the trust# 1. Mary Citizen andtrust deed identifying the 2. John Sample Citizenparties to the trust 4. Citizen Family Trust
A minor Copy of the minor’s The trustees of the trust# 1. Mary Citizen and(less than 18 years old) birth certificate 2. John Sample Citizen
4. Baby Citizen
A partnership Investment operating The principals of the 1. Mary Citizeninstructions which indicate partnership 2. Jesse Samplehow partners are to sign 4. Citizen, Sample &
Associates
An unincorporated Meeting minutes that show Officers on behalf of the 1. John Sample Citizenbody which officers can make unincorporated body 4. Sample Town Under 10
and operate the investment Soccer Club
A business Certificate of Business The proprietor (individuals 1. John Sample CitizenRegistration listing the or a company) trading as 4. Citizen’s Garden proprietors and 100 Point the Business Name EquipmentCheck for each proprietor
A company Copy of the Certificate The name of the company 3. ABC Company Pty Ltdof Registration
An incorporated body Copy of the Certificate of The name of the 3. XYZ Sample Inc.Registration and meeting incorporated bodyminutes that show whichofficers can make andoperate the investment.
* A certified copy which is certified as being a true and accurate copy of the original by a Justice of the Peace, alawyer or doctor.
# Applications in the name of a trust, rather than the trustee, will not be accepted.
35
Macquarie Co-Investment Fund Application
1800 814 523
Tax file number, ABN OR reason for exemption (Refer to page 27)
4. TRUST OR OTHER ENTITY
Name of superannuation fund, trust beneficiaries, deceased estate or unincorporated association
Work phone number Home phone number
Fax number Mobile phone number
Surname
Tax file number OR reason for exemption (Refer to page xx)
Given name(s)
2. JOINT APPLICANTS ONLY - APPLICANT B
D D M M Y Y Y YDate of birth
Title
OtherMsMissMrsMr
Occupation
E-mail address
Work phone number Home phone number
Fax number Mobile phone number
Surname
Tax file number OR reason for exemption (Refer to page 27)
Given name(s)
1. INDIVIDUAL AND JOINT APPLICANTS ONLY – APPLICANT A
D D M M Y Y Y YDate of birth
Title
OtherMsMissMrsMr
E-mail address
Occupation
5. CONTACT DETAILS
Your residential address, leave blank if the same as your mailing address
Suburb
Streetnumberand name
State Postcode
Mailing address (all correspondence will be sent to this address)
Suburb
Street no.& name ORP.O. Box
State Postcode
Do you have any other Macquarie accounts?
Specify a/c no. No Yes
ABN if applicabl e (Refer to page 27)
Tax file number OR reason for exemption (Refer to page 27)
Name of contact person
3. COMPANY, INCORPORATED ASSOCIATION OR BODY
Phone number
Name of company, incorporated association, or incorporated body
Enquiries
Note: Cash is not accepted. Please make cheques payable to:“MIML – Macquarie Co-Investment Fund A/c <Full account name>”
6. INVESTMENT DETAILS
$Total Commitment (A)
$First Installment (50% x A)
Please specify the amount you wish to invest in the Trust. This amount is inclusive of fees.
Complete this form using BLACK INK and print well within the boxes in CAPITAL LETTERS. Mark appropriate answer boxes with a cross (X).Do not use this form unless it is attached to, or accompanies, the Product Disclosure Statement dated 16 May 2005 and issued by Macquarie Investment Management Limited (MIML) ABN 66 002 867 003 and AFSL No 237492.
36
10. ACCOUNT OPERATING INSTRUCTIONS
Joint accounts – If you do not cross a box we will assume “Both to sign”
Either to sign Both to sign together
Commonseal
Any one of us to sign All of us to sign
Other
Will you require tax invoices in order to claim a tax credit? Only relevant to account holders using the trust as part of a business enterprise
No Yes
8. TAX INVOICES
Would you like to receive a paper copy of the trust annual report each year? An electronic copy is available from www.macquarie.com.au/
No Yes
9. ANNUAL REPORT
Name of financial institution
Branch name
7. WHERE WOULD YOU LIKE YOUR DISTRIBUTION PAID
Account name
BSB number
–Account number
Company, Incorporated Association or BodyThese accounts must be signed by two officers (e.g. two Directors or a Director and Secretary), or as required by the Constitution or rules of the company or body (e.g. under seal witnessed by two officers), or signed by one director for a single director company. If you do not cross a box, all future written instructions must be executed in the same way as this application.
Distributions can only be paid to an Australian bank account or to your Macquarie Cash Management Trust. Distributions cannot be paid by cheque.
PLEASE READ THE PRODUCT DISCLOSURE STATEMENT BEFORE SIGNING THIS FORM
Note: Company accounts usually require 2 signatures.(See page 33 for further details)
11. DECLARATION AND SIGNATURE
Authorisation of Applicant A or Company Officer
Name
Other
SIGN HE RE
If a company officer , you must specify your corporate title
Director TrusteeSole Director or Sole Secretary
Authorisation of Applicant B or Company Officer
Name
Other
SIGN HE RE
If a company officer, you must specify your corporate title
Director Secretary Trustee
ADVISER USE ONLY
Adviser stamp
ILAN
ILCN
Adviser name Adviser code
Dealer name Dealer code
Marketing ILGN
Contribution fee to be paid to adviser %.
By stamping this application you are confirming that you hold a current AFS Licence and are authorised to deal in and advise on these managed investment products.
This application accompanies the Macquarie Co-Investment Fund Product Disclosure Statement (PDS) dated 16 May 2005 which contains information about investing in the Trust and which should be read before applying for units in the Trust.I/We acknowledge and declare that:1. I/We agree to be bound by the PDS and the Constitution for the Trust.2. I/We have received and accepted this offer in Australia.3. I/we are not acquiring units in the Fund with the intention of selling or
transferring them.4. All the information in this application form is true and correct.5. MIML can provide information on the status of my/our investment to my/our
nominated financial adviser/broker or any associated Macquarie company.6. I/We agree to MIML and Macquarie collecting, using and disclosing my/our
personal information as set out on page 30 of this PDS.7. The responsible entity of MCIF is required to comply with the anti-money
laundering laws in force in a number of jurisdictions including the Financial Transactions Reports Act 1988 (Cth) and I/we undertake to provide the responsible entity with such additional information or documentation as the responsible entity may request of me, from time to time, to ensure its compliance with such requirements.
8. Should I/we fail to provide the responsible entity with any information or documentation requested of me, my application for Units may be refused and any disposal request by me/us may be delayed or refused and the responsible entity will not be liable for any loss arising thereof.
9. Macquarie Bank Group (other than MIML) has not authorised or caused the issue of the PDS.
10. Macquarie Bank Group (other than MIML) takes no responsibility for any part of the PDS.
11. Macquarie Bank Group (other than MIML) does not endorse or recommend investments under the PDS.
12. I/we understand the risks associated with an investment in the Fund as they are outlined in the PDS.
13. The responsible entity reserves the right to reject any application or to allocate to any applicant a lesser number of units than that applied for.
14. I/we am/are not aware of any liquidation or bankruptcy proceedings that have been commenced or are intended to be commenced by any person against me/us or which are intended or anticipated by me/us.
15. I/we understand that the value of interests in the Fund may rise and fall, from time to time.
16. Investments in the Fund are not deposits with, or other liabilities of, Macquarie Bank Limited ABN 46 008 583 542 or of any Macquarie Bank Group company and are subject to investment risk, including possible delays in repayment and loss of income or principal invested.
17. None of Macquarie Bank Limited, Macquarie Investment Management Limited ABN 66 002 867 003 (the Responsible Entity, we, us, MIML) or any other member company of the Macquarie Bank Group guarantees the performance of the Fund or its underlying investments, the repayment of capital from the Fund or any particular rate of return.
37
Macquarie Co-Investment Fund Application
1800 814 523
Tax file number, ABN OR reason for exemption (Refer to page 27)
4. TRUST OR OTHER ENTITY
Name of superannuation fund, trust beneficiaries, deceased estate or unincorporated association
Work phone number Home phone number
Fax number Mobile phone number
Surname
Tax file number OR reason for exemption (Refer to page xx)
Given name(s)
2. JOINT APPLICANTS ONLY - APPLICANT B
D D M M Y Y Y YDate of birth
Title
OtherMsMissMrsMr
Occupation
E-mail address
Work phone number Home phone number
Fax number Mobile phone number
Surname
Tax file number OR reason for exemption (Refer to page 27)
Given name(s)
1. INDIVIDUAL AND JOINT APPLICANTS ONLY – APPLICANT A
D D M M Y Y Y YDate of birth
Title
OtherMsMissMrsMr
E-mail address
Occupation
5. CONTACT DETAILS
Your residential address, leave blank if the same as your mailing address
Suburb
Streetnumberand name
State Postcode
Mailing address (all correspondence will be sent to this address)
Suburb
Street no.& name ORP.O. Box
State Postcode
Do you have any other Macquarie accounts?
Specify a/c no. No Yes
ABN if applicabl e (Refer to page 27)
Tax file number OR reason for exemption (Refer to page 27)
Name of contact person
3. COMPANY, INCORPORATED ASSOCIATION OR BODY
Phone number
Name of company, incorporated association, or incorporated body
Enquiries
Note: Cash is not accepted. Please make cheques payable to:“MIML – Macquarie Co-Investment Fund A/c <Full account name>”
6. INVESTMENT DETAILS
$Total Commitment (A)
$First Installment (50% x A)
Please specify the amount you wish to invest in the Trust. This amount is inclusive of fees.
Complete this form using BLACK INK and print well within the boxes in CAPITAL LETTERS. Mark appropriate answer boxes with a cross (X).Do not use this form unless it is attached to, or accompanies, the Product Disclosure Statement dated 16 May 2005 and issued by Macquarie Investment Management Limited (MIML) ABN 66 002 867 003 and AFSL No 237492.
38
10. ACCOUNT OPERATING INSTRUCTIONS
Joint accounts – If you do not cross a box we will assume “Both to sign”
Either to sign Both to sign together
Commonseal
Any one of us to sign All of us to sign
Other
Will you require tax invoices in order to claim a tax credit? Only relevant to account holders using the trust as part of a business enterprise
No Yes
8. TAX INVOICES
Would you like to receive a paper copy of the trust annual report each year? An electronic copy is available from www.macquarie.com.au/
No Yes
9. ANNUAL REPORT
Name of financial institution
Branch name
7. WHERE WOULD YOU LIKE YOUR DISTRIBUTION PAID
Account name
BSB number
–Account number
Company, Incorporated Association or BodyThese accounts must be signed by two officers (e.g. two Directors or a Director and Secretary), or as required by the Constitution or rules of the company or body (e.g. under seal witnessed by two officers), or signed by one director for a single director company. If you do not cross a box, all future written instructions must be executed in the same way as this application.
Distributions can only be paid to an Australian bank account or to your Macquarie Cash Management Trust. Distributions cannot be paid by cheque.
PLEASE READ THE PRODUCT DISCLOSURE STATEMENT BEFORE SIGNING THIS FORM
Note: Company accounts usually require 2 signatures.(See page 33 for further details)
11. DECLARATION AND SIGNATURE
Authorisation of Applicant A or Company Officer
Name
Other
SIGN HE RE
If a company officer , you must specify your corporate title
Director TrusteeSole Director or Sole Secretary
Authorisation of Applicant B or Company Officer
Name
Other
SIGN HE RE
If a company officer, you must specify your corporate title
Director Secretary Trustee
ADVISER USE ONLY
Adviser stamp
ILAN
ILCN
Adviser name Adviser code
Dealer name Dealer code
Marketing ILGN
Contribution fee to be paid to adviser %.
By stamping this application you are confirming that you hold a current AFS Licence and are authorised to deal in and advise on these managed investment products.
This application accompanies the Macquarie Co-Investment Fund Product Disclosure Statement (PDS) dated 16 May 2005 which contains information about investing in the Trust and which should be read before applying for units in the Trust.I/We acknowledge and declare that:1. I/We agree to be bound by the PDS and the Constitution for the Trust.2. I/We have received and accepted this offer in Australia.3. I/we are not acquiring units in the Fund with the intention of selling or
transferring them.4. All the information in this application form is true and correct.5. MIML can provide information on the status of my/our investment to my/our
nominated financial adviser/broker or any associated Macquarie company.6. I/We agree to MIML and Macquarie collecting, using and disclosing my/our
personal information as set out on page 30 of this PDS.7. The responsible entity of MCIF is required to comply with the anti-money
laundering laws in force in a number of jurisdictions including the Financial Transactions Reports Act 1988 (Cth) and I/we undertake to provide the responsible entity with such additional information or documentation as the responsible entity may request of me, from time to time, to ensure its compliance with such requirements.
8. Should I/we fail to provide the responsible entity with any information or documentation requested of me, my application for Units may be refused and any disposal request by me/us may be delayed or refused and the responsible entity will not be liable for any loss arising thereof.
9. Macquarie Bank Group (other than MIML) has not authorised or caused the issue of the PDS.
10. Macquarie Bank Group (other than MIML) takes no responsibility for any part of the PDS.
11. Macquarie Bank Group (other than MIML) does not endorse or recommend investments under the PDS.
12. I/we understand the risks associated with an investment in the Fund as they are outlined in the PDS.
13. The responsible entity reserves the right to reject any application or to allocate to any applicant a lesser number of units than that applied for.
14. I/we am/are not aware of any liquidation or bankruptcy proceedings that have been commenced or are intended to be commenced by any person against me/us or which are intended or anticipated by me/us.
15. I/we understand that the value of interests in the Fund may rise and fall, from time to time.
16. Investments in the Fund are not deposits with, or other liabilities of, Macquarie Bank Limited ABN 46 008 583 542 or of any Macquarie Bank Group company and are subject to investment risk, including possible delays in repayment and loss of income or principal invested.
17. None of Macquarie Bank Limited, Macquarie Investment Management Limited ABN 66 002 867 003 (the Responsible Entity, we, us, MIML) or any other member company of the Macquarie Bank Group guarantees the performance of the Fund or its underlying investments, the repayment of capital from the Fund or any particular rate of return.
Macquarie Investment Management LimitedLevel 2220 Bond StreetSYDNEY NSW 2000
PO Box R1723Royal ExchangeNew South Wales 1225
Telephone 61 2 8232 6491Facsimile 61 2 8232 4730Email [email protected] www.macquarie.com.au/mcif
Client Service 1800 814 523
DX 10287 SS
39
CONTACT DETAILS
