fixed income with no stock market exposure - pwc uk · benefits at a glance: > two levels of...

Offer must close on:

16 June 2006

PEP/ISA transfers on:

2 June 2006

Account Manager:

Keydata Investment

Services Limited

Benefit from security:-

– Aims to provide return of capital after 5 or 7 years*

– Plan invests in cash and assets of which 90% are issued by institutions rated ‘A’ or better by Standard & Poor’s or equivalent

* The return of capital is not guaranteed, it is possible for you to get back less than your original investment at the end of the term or if you cash your investment early.

*monthly, quarterly or annual income options available

7.7% 7.5%annual income over 5 years*annual income over 7 years*

OR

68% 43.5% compound growth

compound growth

choice and flexibility:

Fixed Income with NO

Stock Market Exposure

secure income plan - issue 2

A little bit about Keydata...Keydata Investment Services is one of the fastest growing and well regarded Asset Managers in the

UK. We launched our first product in 2001 and since then we have attracted over £1.2 billion of assets

(February 2006).

We provide a wide range of investments through structured products, VCTs and Limited Partnerships.

We began by launching ‘tracker-style’ products that followed leading global financial indices and in 2005

launched our first investments actively managed by fund managers, Keydata AIM VCT and Keydata Income

VCT. All of these investments continue our driving principal of offering investors products with clearly

defined benefits with understandable levels of risk.

We also provide investment administration for some of the leading asset management companies in

the world.

Over 50,000 people have invested in Keydata products and over 8,000 Independent Financial Advisers

have recommended Keydata products to their clients.

secure income plan

Winner Best Structured Products Provider

Winner Best Structured Products Provider

Winner

Investors seeking income are often frustrated because the interest rates offered by banks and building societies

will not produce the level of income they require. At the same time, investments offering higher levels of

income from equities or corporate bonds also come with higher levels of risk. Often investors have to settle

for lower levels of income than they need or accepting a level of risk to capital which is too high.

The Secure Income Plan (‘SIP’) is highly attractive because it offers a higher level of fixed income without

that uncomfortable level of risk from investing in equities or corporate bonds*. The assets it invests in,

cash and insurance contracts, are not linked in any way to the stock market. Over 90% of the insurance

contracts will be issued by institutions rated ‘A’ or better (Source: Standard & Poor’s or equivalent). This

makes it lower risk than many traditional stock market linked income investments (see Generating Income

and Capital Security).

The Secure Income Plan is not the same as bank or building society accounts where capital is guaranteed

and, with instant access accounts, is readily available without penalty.

A lower risk profile and a higher level of income allows you to receive theincome you need without the worry of stock market falls.

Benefits at a glance:> Two levels of income or growth from two investment terms

> Early investment bonus of 3% p.a. interest until 28 June 2006

> Available for ISA and PEP transfers that can boost tax-free income from flagging investments

> Both SIPP and SSAS arrangements can also invest in the Secure Income Plan, providing an alternative tax – efficient means of investing.

> No initial charges - 100% allocation.

* In 2004 Corporate Bonds returned real investment returns of 3.3%, Gilts 3.6%,

Index Linked Funds 4.9% and Cash 1.1% (Source: 2005 Equity Gilt Study, Barclays Capital).

Enjoy fixed income or growth over the next 5 or 7 years

secure income plan

5 Year Term

7.5%

43.5%Annual Income

Compound Growth

1.875%Quarterly Income

0.625%Monthly Income

OR

7 Year Term

7.7%

68%Annual Income

Compound Growth

1.925%Quarterly Income

0.641%Monthly Income

OR

The money in the Secure Income Plan is invested in a combination of cash and a portfolio of US and

Canadian insurance contracts. Income is created through interest on cash and the sale or maturity of the

insurance contracts. The type of insurance contracts in the SIP, corporate protection policies (such as “Key

Man” insurance), are widely recognised to mature at a predictable point in time allowing the flexibility to

sell the contracts at a premium or wait until they mature to generate profits within the SIP. The combination

of the cash and profits from the sale and maturity of insurance contracts allows income payments and aims

to provide full return of capital at maturity. The contracts within the SIP have a fixed maturity value and are

bought at a discount to this, creating the potential for this level of income.

The return of your capital does not depend on the performance of the stock market but at the rate at which

the insurance contracts pay out within the SIP. Because it is possible to ‘model’ how insurance contracts

mature, the risk level of the SIP is reduced because the returns are more predictable than with stock market

investments. The Secure Income Plan uses an actuarial model. This research shows that differences from

the model become unimportant once a large number of contracts are held in the portfolio. In order to

create an immediate spread of contracts the SIP will invest in a new portfolio, creating the diversity

required by the model. One of the risks to your investment is whether the companies issuing the insurance

contracts default on their financial obligations – or put more simply go into liquidation. Please refer to

page 11 where the risk factors are explained in more detail.

You should be reassured that 90% of the insurance contracts within the SIP are issued by financial

institutions with a minimum credit rating of ‘A’ (Source: Standard & Poor’s or equivalent).

The following tables show the fixed payments you would receive for different investment amounts.

Generating Income and Capital Security

secure income plan

annual income option quarterly income option monthly option reinvested income(7.7% per annum) (1.925% per quarter) (0.641% per month) 68% growth option

annual after each after each after growth payment7 years quarter 7 years month 7 years after 7 years

£4,000 (mini isa) £308 £2,156 £77.00 £2,156 £25.64 £2,156 £2,720

£7,000 (maxi isa) £539 £3,773 £134.75 £3,773 £44.87 £3,773 £4,760

£8,000 (double mini isa) £616 £4,312 £154.00 £4,312 £51.28 £4,312 £5,440

£10,000 £770 £5,390 £192.50 £5,390 £64.10 £5,390 £6,800

£14,000 (double maxi isa) £1,078 £7,546 £269.50 £7,546 £89.74 £7,546 £9,520

£20,000 £1,540 £10,780 £385.00 £10,780 £128.20 £10,780 £13,600

£50,000 £3,850 £26,950 £962.50 £26,950 £320.50 £26,950 £34,000

investment amount

7 Year Term

If you decide to take your income monthly you could receive your firstpayment on 31 July 2006.

Reinvest your income for growthThe Secure Income Plan offers you the choice to reinvest your annual income payments and receive themas a final lump sum growth payment at the end of the 7 or 5 year term.

All annual income payments are reinvested meaning that your final growth payment is compoundedcreating a total return of 68% for investors choosing a 7 year term and 43.5% for those choosing a 5 yearteam - an increase of 26% and 16% respectively on money received by income investors over the sametime period, please see the tables below.

secure income plan

annual income option quarterly income option monthly option reinvested income(7.5% per annum) (1.875% per quarter) (0.625% per month) 43.5% growth option

annual after each after each after growth payment5 years quarter 5 years month 5 years after 5 years

£4,000 (mini isa) £300 £1,500 £75.00 £1,500 £25.00 £1,500 £1,740

£7,000 (maxi isa) £525 £2,625 £131.25 £2,625 £43.75 £2,625 £3,045

£8,000 (double mini isa) £600 £3,000 £150.00 £3,000 £50.00 £3,000 £3,480

£10,000 £750 £3,750 £187.50 £3,750 £62.50 £3,750 £4,350

£14,000 (double maxi isa) £1,050 £5,250 £262.50 £5,250 £87.50 £5,250 £6,090

£20,000 £1,500 £7,500 £375.00 £7,500 £125.00 £7,500 £8,700

£50,000 £3,750 £18,750 £937.50 £18,750 £312.50 £18,750 £21,750

investment amount

5 Year Term

£4,000 (mini isa) £2,156 £2,720 26.16%

£7,000 (maxi isa) £3,773 £4,760 26.16%

£8,000 (double mini isa) £4,312 £5,440 26.16%

£10,000 £5,390 £6,800 26.16%

£14,000 (double maxi isa) £7,546 £9,520 26.16%

£20,000 £10,780 £13,600 26.16%

£50,000 £26,950 £34,000 26.16%

monthly, quarterly, annualincome payment after 7 years growth payment after 7 years

% increase over the period bychoosing the growth option

7 Year Term

£4,000 (mini isa) £1,500 £1,740 16%

£7,000 (maxi isa) £2,625 £3,045 16%

£8,000 (double mini isa) £3,000 £3,480 16%

£10,000 £3,750 £4,350 16%

£14,000 (double maxi isa) £5,250 £6,090 16%

£20,000 £7,500 £8,700 16%

£50,000 £18,750 £21,750 16%

monthly, quarterly, annualincome payment after 5 years growth payment after 5 years

% increase over the period bychoosing the growth option

5 Year Term

secure income plan

Parties InvolvedKeydata Investment ServicesKeydata is the promoter of the product, administrator, PEP and ISA manager and the interface betweeninvestors / IFAs. It is also responsible for appointing and monitoring other parties involved in the operation ofyour investment.

A leading Investment Bank (Minimum AA- rated by Standard & Poor’s)Trading of the insurance contracts is overseen by the Bank who ensure at least 90% of the contractspurchased are issued by insurers rated ‘A’or better by Standard & Poor’s or equivalent. Once bought, The Bankholds the contracts as Trustees for the SIP. Furthermore, the Bank is liable for ensuring that contracts adhereto the investment criteria and are serviced, i.e. premiums are paid.

Please see page 10 and the section entitled ‘Your Investment’ for an explanation of the Standard & Poor’scredit rating.

Life SettlementKeydata will arrange for a US based company that will identify and process contracts for purchase accordingto investment criteria under a written origination agreement.

Bond Custodian The custodian of the Bond is also the registrar and payment administrator for the issuer. It also oversees theissuing of the Bond in Luxembourg. The Bond Custodian is 'A' rated by Standard & Poor’s.

Monitoring your moneyTo help you keep track of your investment we will send you an annual statement. This will include the valueof your investment and details of any income payments or the value of reinvested income. You can alsofollow the progress of your investment by visiting our website www.keydata.co.uk where you can find upto date values of the Secure Income Plan and also all of Keydata’s other investments.

What else should I know?It is important that you read the Key Features section before you decide to invest. This contains full details ofthe SIP and how it works. Because of how it works you should only consider the SIP if you are prepared toaccept a degree of risk to your capital and do not require access to your investment during the term. The factthat the return of your original investment is linked to a range of predictable outcomes in respect of how theassets within the SIP perform is an important feature for you to understand.

How can I invest?The Secure Income Plan is available in a number of ways:

Invest in a new ISAYou can invest up to £7000 in your 2006/2007 ISA completely tax-free. Both Mini-ISA and Maxi-ISA Plansare available. Couples can double up to a total investment of £14,000. All your returns are tax-free.

secure income plan

*Note: the levels and basis of taxation and reliefs from taxations can change at any time. The availability

and value of any tax reliefs depends on individual circumstances.

2005/2006 isa £7,000 £539 £134.75 £44.87 £4,760

isa/pep transfer £10,000 £770 £192.50 £64.10 £6,800

direct investment £15,000 £924 £231.00 £76.92 £8,160(basic rate tax payer)

direct investment £15,000 £693 £173.25 £57.69 £6,120(higher rate tax payer)

investmentamount

7.7% annual income

1.925% quarterly income

0.641% monthly income

68% growth

7 Year Term

2005/2006 isa £7,000 £525 £131.25 £43.75 £3,045

isa/pep transfer £10,000 £750 £187.50 £62.50 £4,350

direct investment £15,000 £900 £225.00 £75.00 £5,220(basic rate tax payer)

direct investment £15,000 £675 £168.75 £56.25 £3,915(higher rate tax payer)

investmentamount

7.5% annual income

1.875% quarterly income

0.625% monthly income

43.5% growth

5 Year Term

Transfer an existing ISA or PEPAn advantage of ISA and PEP investments is that you can transfer them to new investments that offer youmore attractive returns. This can be particularly attractive to income investors where the level of incomefrom existing investment has fallen. Because the PEP and ISA transfers maintain their tax free status allincome or growth payments remain tax free. Note: Your previous investment manager may charge you fortransferring your investment and whilst the transfer is underway there is the potential to lose someincome or growth.

Invest directlyIf you have used your ISA allowance or want to invest more than £7,000 you can invest directly into theSecure Income Plan. Direct investments are not automatically tax free so you need to think about whetheror not you will have to pay tax by investing.

Direct Income investmentsIncome received by direct investors is ‘distributed gross’ meaning that it is not taxed. You have to declarethis income on your annual tax return. Income from the SIP will currently be taxed at the rates of 20% forbasic rate taxpayers and 40% for higher rate taxpayers.

Pension PlansIt is possible for SIPP and SSAS Plans to invest in the Secure Income Plan. Any income would be free of taxwithin such pension arrangements.

Direct Growth investmentsGrowth received at maturity is taxed as income by HM Revenue & Customs.

After income tax, where appropriate, this is what you could receive:

secure income plan

Before making the decision to invest you must read the Key Features document including Terms &Conditions and Application Forms.

You should ensure that this product is suitable for you. Please ensure you have read the Risk Factorssection which is on page 11 of this document.

There are four application forms, 2 for the 7 year term and 2 for the 5 year term:

7 year term Application Forms (Green Form):> ISA and Direct Investment;> ISA and PEP transfers.

5 year term Application Forms (Blue Form):> ISA and Direct Investment;> ISA and PEP transfers.

If you are applying for an ISA or Direct Investment please complete sections 1-4 on the relevant form and remember to sign it.

If you are applying for a PEP or ISA transfer, you should complete sections 1-3 on the front of the relevantapplication form and section 4 on the reverse of the form and remember to sign it.

It is only necessary to send one cheque for the total amount that each individual wants to invest (e.g. onecheque for £15,000 can cover an ISA investment of £7,000 and a direct investment in shares of £8,000).Please note, separate applications (e.g. from a husband and wife) require two cheques.

Cheques should be made payable to ‘Keydata - Secure Income Plan Client A/C’. If your cheque is from aBuilding Society, it should reference your name. (For example ‘Keydata - Secure Income Plan Client A/C’Reference ‘A Smith’)

Please Note:Keydata Investment Services Limited does not offer investment advice or make any recommendations in relationto the SIP. This investment is not suitable for everyone. If you have any doubt whether it is suitable for you, youshould obtain expert advice from your Independent Financial Adviser.

Past performance IS NOT an indication of future performance and you may get back less than your original investment.If you sell your investments before maturity you may get back less than the amount you originally invested.

Thank you for choosing to invest with Keydata

Before You Invest

Application checklist1. Have you read the Key Features and Terms & Conditions?

2. Have you filled in the correct application form for either ISA and Direct Investments or PEP/ISA transfers?

3. Have you signed the application form?

4. Have you signed and dated a cheque made payable to Keydata – Secure Income Plan Client A/C?

secure income plan

Is there any risk?With the current low interest rate environment, we think the level of income is attractive. However, you should understand that your capital is not guaranteed and that your investment is not accessiblewithout penalty during the term of the SIP.

Your capital is at risk in the following circumstances:

> If the insurance companies issuing the insurance contracts default on their obligations

> If the issuer of the SIP goes into liquidation

> If factors change which affect the rate at which insurance contracts mature.

> The Secure Income Plan is designed to be held for the full term of either 5 or 7 years. If the investment iswithdrawn/transferred prior to the end of the term your return may not be as much as expected andcould result in a poor return.

Please refer to page 11 and the section entitled ‘Risk Factors’ where the risk factors are explained in more detail.

Secure Income Plan ChargesThe Secure Income Plan is designed to be held for the full term of either 5 or 7 years. Should you subsequentlywithdraw by selling your investment at any time during the investment period, a withdrawal fee of £150.00 + VATadministration charge will be levied. Also, the cash value is not guaranteed and will depend on prevailingmarket conditions including, but not limited to, interest rates and the performance of the underlying portfolioof insurance contracts. As all charges are reflected in the terms offered, the value of your investment is likely tobe less than the amount originally invested in it, particularly during the early years of the Plan.

Is there any benefit in investing early into the Plan?Yes. There are two benefits. Firstly, you will avoid the possibility of missing the offer if it has to close earlier than 16 June 2006 due to over subscription.

Secondly, you will benefit from an early investment bonus of 3% p.a. gross interest (less tax where appropriate)from the date your funds clear until 28 June 2006. This interest, plus your initial investment, will then beinvested into your investment choice as appropriate. You should understand that your capital is notguaranteed and that your investment is not instantly accessible without penalty during the term of the SIP.

Please refer to the Key Features on page 10 under ‘Your Investment’.

Important Datessecure income plan investment timetable 5 year term 7 year term

the last day for isa/direct investments is 16 june 2006 16 june 2006

the last day you can transfer your pep or isa is 2 june 2006 2 june 2006

the plan starts on 30 june 2006 30 june 2006

the plan matures on 30 june 2011 30 june 2013

annual income payments will start on 30 june 2007 and continue until 30 june 2011 30 june 2013

quarterly income payments will start on 30 september 2006 and continue until 30 june 2011 30 june 2013

monthly income payments will start on 31 july 2006 and continue until 30 june 2011 30 june 2013

growth payment date 7 july 2011 7 july 2013

capital repayment date 7 july 2011 7 july 2013

secure income plan

> your choicesYou can invest your money in one or more of the followingways:– Direct Investment;– via a Mini or Maxi-ISA; – transferring an existing PEP &/or ISA;– through SIPP/SSAS pension investments.All of the above options are described in these Key Features.

> its aims– To provide either regular income or capital growth over the

SIP term. Specific information regarding the income andgrowth options are described later in the section “What isthe income option?’ and ‘What is the growth option?’

– To provide a full return of original capital at maturity.

You will choose to receive income or growth payments fromthe Investment Options as outlined on page 12. As soon aspracticable after your investment matures you will have thechoice of closing your SIP(s), transferring to another PlanManager or continuing your investment on new terms thatmay by offered by Keydata Investment Services Limited (theAccount Manager), at that time.

> your investmentYour commitment is to be prepared to hold your investmentfor the full 7 or 5 years, until 30 June 2013 or 30 June 2011respectively. The minimum amount you can invest in theSecure Income Plan is £4,000.If you wish to invest in a Maxi-ISA or a Mini Stocks and Shares ISA, the maximum youcan invest in any one tax year is £7,000 or £4,000 respectively,as specified by HM Revenue & Customs.

If you invest in the Maxi-ISA you cannot subscribe to any otherISA in the same tax year. If you invest in the Mini-ISA youcannot subscribe to any other Stocks and Shares Mini-ISA or a Maxi-ISA in the same tax year.

You may also invest in a SIP via a PEP &/or ISA transfer byrequesting us to contact your existing Account Manager toeffect a cash transfer into the Sip. The minimum aggregatetransfer amount is £4,000 - again, there is no maximum.

You will earn 3% p.a. gross interest (less tax whereappropriate) from the date your funds clear until 28 June2006. This interest, plus your initial investment, will then beinvested into your investment choice as appropriate. Youshould understand that your capital is not guaranteed andthat your investment is not instantly accessible withoutpenalty during the term of the SIP.

Your money will be invested in a Bond listed on the LuxembourgStock Exchange where the assets are a mix of cash and US andCanadian insurance contracts. At least 90% of the contractspurchased are issued from institutions rated a minimum ‘A’ byStandard and Poor’s or equivalent.

The SIP will provide you with income or growth payments andmaturity proceeds at the end of the investment term.

Under the terms of the SIP, some of the insurance contracts willmature during the term creating income and capital and furthercontracts will be sold immediately prior to maturity to ensureSIP returns are met as required. The Standard & Poor's credit rating is a current opinion of an issuer's overall financial capacity (its creditworthiness) to payits financial obligations. This opinion focuses on the issuers’capacity and willingness to meet its financial commitments asthey come due.

The credit rating is not a recommendation to purchase, sell, orhold a financial obligation, as it does not comment on marketprice or suitability for a particular investor.

> Product StructureThe Secure Income Plan is a sterling denominated Bond listedon the Luxembourg Stock Exchange. This makes it eligible fordirect, SIPP, SSAS, PEP and ISA investment.

Copies of the Prospectus are available on request.

> Investment ObjectiveThe investment objective of the SIP is to provide regular fixedincome payments over a 7 or 5 year term and a full return ofcapital at maturity. Alternatively investors may elect to roll upincome distributions into one final payment.

> Parties involvedKeydata Investment ServicesKeydata is the promoter of the product, administrator, PEP andISA manager and the interface between investors / IFAs. It isalso responsible for appointing and monitoring other partiesinvolved in the operation of your investment.

A leading Investment Bank (Minimum AA- rated by Standard & Poor’s)Trading of the insurance contracts is overseen by the Bank whoensure at least 90% of the contracts purchased are issued byinsurers rated ‘A’or better by Standard & Poor’s or equivalent.Once bought, The Bank holds the contracts as Trustees for theSIP. Furthermore, the Bank is liable for ensuring that contractsadhere to the investment criteria and are serviced, i.e.premiums are paid.Please see page 10 and the section entitled ‘Your Investment’for an explanation of the Standard & Poor’s credit rating.

Life SettlementKeydata will arrange for a US based company that will identifyand process contracts for purchase according to investmentcriteria under a written origination agreement.

Bond Custodian The custodian of the Bond is also the registrar and paymentadministrator for the issuer. It also oversees the issuing of theBond in Luxembourg. The Bond Custodian is 'A' rated byStandard & Poor’s.

> Asset allocationYour money will be invested in the SIP where the assets are a mixof cash and insurance contracts. The cash element is used to paypremiums for contracts and income payments to investors. Theasset mix is balanced through maturing contracts.

Key Features

secure income plan

> Contract selectionThe SIP has strict criteria governing the type of insurancecontract that can be held within it. There are clearly definedresponsibilities for verification and lapse risk. One of the typesof contract bought will be commercial key man insurancecontracts held by businesses that would otherwise lapse thecontract on the retirement of the individual insured.

Each contract that is bought undergoes an evaluation fromwhich the expected maturity date can be determined. This isdone twice if there is a decision to buy the contract. The firstoccasion is to assess the compatibility of the contract with theinvestment criteria. If the contract then proceeds to purchasethis is verified by an independent third party.

> Investment TimingIt is envisaged that the SIP will have purchased a sufficientnumber of contracts to achieve its investment aims in theportfolio. The actuarial model allows for six months for theoptimum number of contracts to be purchased. Thisconservative approach has been adopted to create flexibility in the investment process if unforeseen circumstances delaythe planned purchase of assets.

> Income and capital repaymentThe SIP has been structured to produce 7.5% income perannum in the 5 year Plan and 7.7% income per annum in the 7 year Plan and full capital repayment at maturity. Its structuremeans that if there are any residual contracts that have notmatured by the SIP maturity date they will be sold. In additionmechanisms have been put in place to mitigate other risk factors:– Mix of cash and contracts allows payments of income,

early redemptions and premiums to be fundedThe value of a contract increases with time as it nears likelymaturity and there is an established second hand market inthe US that will buy these contracts.

> risk factors– Predicted Maturity rates

The actuarial modeling used to provide the financialmodels for the SIP is based on recognised industrystandards. Whilst these are not subject to rapid changethere is a risk that a significant technological orpharmaceutical development could impact on the accuracyof the models and when contracts are likely to mature.

This is considered to be a small risk due to the size of theportfolio and the spread of expected maturity dates acrossthe contracts. Furthermore, any such advance is highlyunlikely to affect all contracts and would also be difficult togain regulatory approval for, within the five or seven yearterm of the SIP.

– Credit riskThere are two distinct credit risks.1) The issuing companies of the insurance contracts2) The issuer of the Bond

– Issuing company riskThere are 3500 contract issuers in the US and Canada that canbe included in the portfolio. Large reserves are carried bythese companies to protect against default and, were this tohappen the contracts are likely to be assumed by anotherprovider i.e. the book is traded en masse.

– Government legislationThere can be no guarantee that during the life of the SIPnew legislation could alter the market for trading insurancecontracts, both in terms of their availability for purchaseand market for trade. Whilst there has been no indication of any policy to change the current market, this is still apotential risk.

– Valuation of traded insurance contractsThe actuarial models used in the SIP have been stress tested but there can be no guarantee that they will functionas anticipated. This could lead to contracts possibly beingmis-priced relative to their future sale value if contracts arestill current when the SIP matures.It is also assumed that the longer a contract is owned by theSIP the greater its market value since it is closer to possiblematurity. If the dynamics of the market change this mightnot be the case and it would therefore be possible forcontracts to fall in value. If this were to happen capital mightnot be returned in full at the end of the term which involvesthe sale of residual contracts to generate sufficient cash.

– Can I withdraw before the end of the term?The Secure Income Plan is designed to be held for the fullterm of either 5 or 7 years. Should you subsequentlywithdraw by selling your investment at any time during theinvestment period, a withdrawal fee of £150.00 + VATadministration charge will be levied. Also, the cash value isnot guaranteed and will depend on prevailing marketconditions including, but not limited to, interest rates andthe performance of the underlying portfolio of insurancecontracts. As all charges are reflected in the terms offered,the value of your investment is likely to be less than theamount originally invested in it, particularly during theearly years of the Plan.

– You cannot claim full reimbursement if the price at whichyour securities were purchased has fallen, when we sellthem, following you exercising your right to cancel. We willdeduct an exit charge of a £150 + VAT administrative fee.

– If the investment is withdrawn or transferred prior to theend of the term your return may not be as much asexpected and could result in a poor return.

– If you have invested via an ISA and subsequently decide towithdraw, it will not be possible to invest in another ISA forthe relevant tax-year in which you invested.

– The levels and basis of taxation and reliefs from taxationcan change at any time. The value of any tax reliefs dependson individual circumstances.

– Tax assumptions are based on our understanding of currentlegislation and practice at the time of print - these maychange in the future.

– Past performance IS NOT an indication of futureperformance and should not be used to assess the risksassociated with this investment.

secure income plan

> other risk factorsPolitical and EconomicThere can be no assurance that a change in Government oreconomic policy or a decision by the incumbent Governmentto change the legislation affecting the marketplaces withinwhich the investment manager operates, will not occur duringthe investment period. As such, this could have a materialadverse effect on the potential of your investment.

LiquidityThere can be no assurances that there will be any continuousmarket for the eligible assets traded during the investmentperiod. As such, there is a risk that insurance contracts maytake longer to be sold or bought than anticipated, particularlyif there is insufficient demand from the marketplace, resultingin low or non-existent trading volumes.

Eligible AssetsYour investment could be at risk if a number of eligible assetsdo not mature in a way predicted by the Financial Model.However, the Financial Model is reviewed every 6 months toensure that the balance of cash and eligible assets remain ontarget to meet the SIP’s objectives.

Low subscriptionIn the event of low subscription the SIP will not be issued andcapital will be returned to investors.

Your questions answered> what are personal equity plans and individual savings

accounts?

personal equity plansThese have been available since 1987 and have facilitated theachievement of tax-free investment growth and/or tax-freeincome via investing in collective investment schemes, stocks and shares.

PEPs were replaced by Individual Savings Accounts from 6thApril 1999, although all PEPs held as at the 5th April 1999 willcontinue to be held as PEPs with broadly the same taxadvantages as ISAs.

In addition, the value of any PEP holding does not affect theamount that may be subscribed to an ISA.

individual savings accountsThese are tax-efficient savings vehicles and can invest in twodistinct categories or components: cash and stocks and shares(including collective investment schemes).

You are eligible if you are:

– aged 18 or over for the stocks and shares component; or

– aged 16 or over for the cash component; and

– resident and ordinarily resident in the United Kingdom fortax purposes; or

– a crown employee or their spouse currently workingoverseas and treated as resident in the UK.

However, you cannot hold an ISA jointly with anyone else orhold one on behalf of another person.

There is no restriction on the amount that can be invested,other than the annual subscription limits. An ISA can be aMini-ISA, a Maxi-ISA or a TESSA-only ISA. You cannot switchbetween different types of ISAs i.e. Maxi or Mini, nor can youswitch between different components.

a mini-isaThis element comprises only one component: either cash orstocks and shares. If you subscribe to a Mini-ISA, that is theonly ISA to which you can subscribe in the same tax-year,other than to another Mini-ISA consisting of a differentcomponent. For example, if you subscribe to a cash Mini-ISA,you can still subscribe to a Stocks and Shares Mini-ISA but notanother cash Mini-ISA in the same tax-year.

a maxi-isaThis element comprises at least the stocks and sharescomponent, and may also include a cash component. If yousubscribe to a Maxi-ISA you cannot subscribe to another ISA,whether it be a Maxi-ISA or Mini-ISA in the same tax-year.

> what is the income option?

This provides annual, quarterly or monthly income.

In 7 year plan:The annual payment is 7.7% gross commencing 30 June 2007until 30 June 2013 inclusive. Quarterly payments are 1.925 %gross commencing 30 September 2006 until 30 June 2013inclusive. Monthly payments are 0.641% gross commencing 31 July 2006 until 30 June 2013 inclusive.

In 5 year plan:The annual payment is 7.5% gross commencing 30 June 2007until 30 June 2011 inclusive. Quarterly payments are 1.875 %gross commencing 30 September 2006 until 30 June 2011inclusive. Monthly payments are 0.625% gross commencing 31 July 2006 until 30 June 2011 inclusive.

> what is the growth option?This provides capital growth equal to 68% in the 7 year termand 43.5% in the 5 year term gross of the amount invested.You will receive this at the end of the SIP term on 7 July 2013 inthe 7 year term or on 7 July 2011 in the 5 year term. The growthpayment is made without any deduction for tax and isreceived tax-free if invested in an ISA or PEP.

> how are you able to offer high income?The SIP enters into a number of investment transactions in orderto produce the advertised returns using a financial model. Thismodel ensures that an appropriate level of cash and assets aremaintained at any one time and that enough assets reachmaturity to generate the advertised returns.

> what about my final capital repayment?In addition to the income or growth option you have chosen, youshould receive your full original investment (plus any interestearned during the offer period). At the end of the investmentperiod, any insurance contracts that have not matured will besold and added to the cash element in the SIP, after which youroriginal investment will be returned to you in full. It is possiblethat you will not receive your original investment back in full andyou should refer to page 11 and the section entitled ‘Risk Factors’for a wider description.

Geared to deliveroutstanding returns

secure income plan

> who can invest?UK investors aged 18 and over can invest via an ISA or theDirect Investment option. Investments can also be madethrough the Direct Investment option on behalf of a personunder the age of 18.

> can i cancel my investment?

You will have the right to cancel your SIP within 14 days ofreceiving from us a notice of your right to cancel. Withdrawalnotices, which Keydata receives prior to the investment dateon 30 June 2006, will receive a full return of the initialinvestment. No early bonus interest will be paid oncancellation.

However, you should note that for notices received on or after30 June 2006, the date on which securities will be purchased,you cannot reclaim a full refund of your investment if the priceat which assets within the SIP were purchased have fallen atthe time you elect to cancel your investment. In thesecircumstances an amount equivalent to the fall in the price ofthe securities and a cancellation administration fee of £150 +VAT will be deducted. Also, the cash value is not guaranteedand will depend on prevailing market conditions including,but not limited to, interest rates and the performance of theunderlying portfolio of insurance contracts. As all charges arereflected in the terms offered, the value of your investment islikely to be less than the amount originally invested in it,particularly during the early years of the Plan..

If you exercise your right to cancel your SIP following a PEP orISA transfer, the proceeds will be paid direct to you and you willirrevocably lose any favourable tax treatment associated withthat PEP or ISA holding.

> can i withdraw before the end of the term? The Secure Income Plan is designed to be held for the full termof either 5 or 7 years. Should you subsequently withdraw byselling your investment at any time during the investmentperiod, a withdrawal fee of £150.00 + VAT administrationcharge will be levied. Also, the cash value is not guaranteedand will depend on prevailing market conditions including,but not limited to, interest rates and the performance of theunderlying portfolio of insurance contracts. As all charges arereflected in the terms offered, the value of your investment islikely to be less than the amount originally invested in it,particularly during the early years of the Plan.

> if i am considering a pep or isa transfer, is thereanything else i should know?

Your existing investment must be transferred in cash, whichmeans that your existing Account Manager will sell yourinvestment holdings.

Your existing Account Manager may charge you an exit ortransfer fee. There is the potential for loss of income orgrowth, if markets should rise, while your transfer remainspending. Please note that to ensure that the funds are receivedfrom the existing Account Manager in a timely manner, we have an early cut-off date for PEP and ISA transfers of 2 June 2006.

We then ask your existing Account Manager to credit funds tous by 23 June 2006 at the latest. If this date is missed it maynot be possible to reinstate your investment with yourprevious Account Manager.

> what happens if i die?Your investments will be transferred to either your personalrepresentatives or beneficiares, as directed by them afterprobate has been granted and proven. This will incur anadministrative charge of £65 + VAT. The total value of yourinvestments forms part of your estate for inheritance taxpurposes. ISAs and PEPs automatically lose their tax-freestatus on the death of the holder.

> how will charges and expenses affect my investment?The Secure Income Plan is designed to be held for the full termof either 5 or 7 years. Should you subsequently withdraw byselling your investment at any time during the investmentperiod, a withdrawal fee of £150.00 + VAT administrationcharge will be levied. Also, the cash value is not guaranteedand will depend on prevailing market conditions including,but not limited to, interest rates and the performance of theunderlying portfolio of insurance contracts. As all charges arereflected in the terms offered, the value of your investment islikely to be less than the amount originally invested in it,particularly during the early years of the Plan.

For products that have returns linked to a stock market index,including returns from dividends, it is useful for investors to show how charges reduce yield. This is presented in areduction in yield table. The returns from this product are notdependent upon the performance of an index and as such we feelit is not appropriate to include a reduction in yield table.Keydata will receive a fee for administration and distribution.This will not affect the return. There are no other explicit charges.

> what is my tax liability?If you have invested via an ISA and/or PEP, all investmentreturns from your SIP are currently free of income tax andcapital gains tax. If you have invested via the DirectInvestment Option, investment growth is subject to IncomeTax and the amount of tax you pay will depend on yourindividual circumstances.

Prior to 28 June 2006 your investment will be held in cash andwill earn interest. Interest earned on ISAs is credited net of a20% flat rate charge; on PEPs, although the position underapplicable legislation is unclear, HM Revenue & Customscurrently allow this interest to be credited gross; on DirectInvestment where interest is credited, it will be credited lessany tax deducted at source, and higher rate income tax payerswill be liable to pay further tax at 40% on the interest (withcredit given for any tax deducted at source).

These statements are based on our understanding of currentlegislation, regulations and practice, all of which may changeand any change may be applied retrospectively. If you require further information or advice regarding your potentialtax liability, you should contact your Independent Financial Adviser.

secure income plan

> how much will any advice cost?If you receive advice from an Independent Financial Adviser,under normal circumstances we will pay commission of 3%plus an annual trail commission of 0.5%. If you are not takingadvice, commission may still be payable to an IndependentFinancial Adviser. The amount of commission will depend onthe size of your investment. This amount will also be includedin your welcome letter. Commission is already accounted for inthe terms offered and does not affect the return shown.

For an investment of £10,000 a 3% commission of £300 wouldbe paid plus an annual trail commission of 0.5%, £50 would be paid for 7 or 5 years making a total payment for this option of £650 or £550 respectively.

> how can i invest?

If after reading the SIP documentation you wish to invest,please complete and sign the relevant sections of theapplication for the SIP(s) and/or complete the separate PEP/ISAtransfer form. Send the completed form to your IndependentFinancial Adviser or to Keydata Investment Services Limited atFloor 8, Fountain House, 2 Queens Walk, Reading RG1 7QF,along with your cheque. If you are unsure whether thiscontract is suitable for your financial planning needs, youshould seek advice from an Independent Financial Adviserwho may charge a fee for any advice given.

All Direct and ISA applications must be received no later than5pm on 16 June 2006 for Applications to transfer existing PEPsor ISAs must be received by 2 June 2006 at the latest. Allapplications after these dates will not be accepted. Thesubscriptions will be invested in the SIP(s) after receipt of anacceptable application.

> what documentation will i receive?Within 5 working days of receipt of your application we willsend you an acknowledgement. We will also, if applicable,send a notice of your right to withdraw (as describedpreviously). Within 25 business days, following investmentinto the securities which provide the SIP returns, a statementshowing your investment within the SIP will be sent to you.Every year thereafter, you will receive a statement andvaluation of your investment. This will be issued within 25 business days of the SIP’sinvestment anniversary.

All investments will be registered in the name of the nomineecompany ‘Keydata Investment Product Nominees Limited’ orother such nominee approved by the Account Manager,although your holding is recorded and separately identified byus. No certificates will be issued.

> complaintsThe Account Manager has procedures in place in accordancewith the regulations for the effective consideration ofcomplaints. All formal complaints should, in the first instance,be made in writing to the Compliance Officer at KeydataInvestment Services Limited, Floor 8, Fountain House, 2 Queens Walk, Reading RG1 7QF. In addition, and if you are not happy with our response, you have the right to complaindirectly to the Financial Ombudsman Service at the followingaddress: Financial Ombudsman Service, South Quay Plaza, 183 Marsh Wall, London E14 9SR. Telephone: 0845 080 1800.Please note that making a complaint will not prejudice yourright to take legal proceedings.

A statement describing our complaints handling procedure is available on request.

> are there any compensation scheme arrangements?Should Keydata Investment Services Limited becomeinsolvent, compensation may be available from the FinancialServices Compensation Scheme, 7th Floor, Lloyds Chambers,Portsoken Street, London E1 8BN. Telephone: 0207 892 7300.

A statement describing your rights to compensation isavailable on request.

> data protectionThe information you provide on your application form (or subsequently) will be held and processed by us as datacontroller for the purposes of the Data Protection Act 1998. We may hold and process information for the administrationof the service(s) for which you are currently applying or mayapply for in future, for the operation of your investment inshares (including e.g. for registration and distributionpurposes), for the purposes of statistical analysis, and themarketing of goods or services by this company or othercompanies in the Keydata group. We may transfer informationto other companies in the Keydata group and to third partyagents of such companies or of this company for any of theabove purposes. Where an Independent Financial Adviser actson your behalf, we will disclose information concerning yourinvestment to that financial adviser. Save as noted above, wewill not provide to any other third party any informationrelating to you, unless you have given your written consent orunless we are required to do so by law. You are entitled torequest details of information we may hold about you uponpayment of a fee and to require us to correct any inaccuraciesin your personal data.

> money launderingAll transactions relating to products provided by KeydataInvestment Services Limited are covered by the MoneyLaundering Requirements (Criminal Justice Act 1993, theMoney Laundering Regulations 2003, FSA Rules and anyrelevant guidance notes). This means that we are responsiblefor compliance with these Regulations. As a consequence, youmay be required to provide proof of identity when buying orselling your investment.

> lawThe Law governing the contract is English Law.

secure income plan

Terms & Conditions1 Definitions:

In these terms the following words mean:-

“Account Manager” Keydata Investment Services Limited.

“Effective Date” 30 June 2006

“FSA” The Financial Services Authority is a non-governmentalbody given statutory powers by the Financial Services andMarkets Act 2000.

“ISA” Maxi or Mini Individual Savings Account.

“Keydata” Keydata Investment Services Limited.

“PEP” Personal Equity Plan.

“Plan” ISA, PEP or Direct Investment as held under these termsand conditions.

“Regulations” The Individual Savings Account Regulations 1998 and/orthe Personal Equity Plan Regulations 1989, as amended.

“Securities” Bond listed on the Luxembourg Stock Exchange.

“Secure Income Plan” Bond listed on the Luxembourg Stock Exchange.

“SIP” Secure Income Plan

“We”, “us” & “our” Keydata Investment Services Limited, which is authorisedand regulated by the Financial Services Authority.

“You” and “your” An investor who applies to open an ISA (or DirectInvestment) or in the case of a PEP (or ISA) Transfer, aninvestor who applies to transfer their PEP (or ISA) on theseterms and conditions.

2 Your SIP:i. If applicable you may open more than one SIP.

ii. On the receipt of a duly completed application form and cheque the AccountManager may accept it subject to these Terms and Conditions. The AccountManager reserves the right to reject an application for any reason.

iii. The application form you use is part of these terms and conditions and if theterms differ, those contained in our application form will prevail.

iv. In the case of an ISA investment, your SIP will be opened upon receipt by us ofa duly completed application together with your initial cash subscription.Subject to the Regulations we may open a SIP provisionally where theinformation which you have supplied is insufficient. In respect of an ISA,where we open a SIP on a provisional basis you must supply the missinginformation within 30 days, otherwise the SIP must be voided in accordancewith HM Revenue & Customs requirements.

v. In the case of a PEP or ISA transfer, we will manage your SIP upon receipt by usof the proceeds of your previous Plan from your previous Account Manager.

vi. You are classified as a Private Customer within the meaning of the FSAhandbook unless we specify otherwise in correspondence with you.

vii. Your SIP will have the features including the investment returns and risksdescribed elsewhere in this document.

3 Cancellation Rights:You will have the right to cancel your SIP within 14 days of receiving from us anotice of your right to cancel. Withdrawal notices, which Keydata receives prior tothe investment date on 30 June 2006, will receive a full return of the initialinvestment. No early bonus interest will be paid on cancellation.

However, you should note that for notices received on or after 30 June 2006, thedate on which securities will be purchased, you cannot reclaim a full refund ofyour investment if the price at which assets within the SIP were purchased havefallen at the time you elect to cancel your investment. In these circumstances anamount equivalent to the fall in the price of the securities and a cancellationadministration fee of £150 + VAT will be deducted.

If you exercise your right to cancel your SIP following a PEP or ISA transfer, theproceeds will be paid direct to you and you will irrevocably lose any favourable taxtreatment associated with that PEP or ISA holding.

4 Subscriptions:You must subscribe to the SIP with your own cash or by transfer of cash from anexisting ISA. Investment into a PEP SIP may only be made by transfer of cash froman existing PEP. Once the PEP or ISA has been transferred, your PEP or ISA SIP willbe subject to these Terms & Conditions.

5 Permitted Investments:The Securities available under the SIP is a Bond denominated in Sterling andqualifying for the purposes of ISA and PEP investments. The Account Managerconfirms that it will be acting as your agent in arranging for the purchase of theseSecurities and accordingly acknowledge and confirm on behalf of any Issuer, itsaffiliates and directors (together the 'Issuer') that it does not act as agent for theIssuer and that any offer of securities is not authorised by any Issuer and is madewithout the Issuer's knowledge or prior approval.

6 Cash held within your SIP:Cash will be held in a pooled Keydata ISA designated Client Account with a bank(which is not an associate of the Account Manager). Interest earned on cashdeposits will be credited to your SIP net of any tax where applicable in accordancewith client money rules of the FSA. Interest will first be credited until 28 June 2006prior to investment in the Securities and will be rounded down to the nearest wholepound (with transfers interest credited will be such that when added to yourinvestment amount will result in an amount being rounded down to the nearestpound). The Account Manager may benefit from the aggregation of client balancesheld, but the rate of interest you will earn will not be less than the publicly-offereddeposit account rate with a high street bank before any deduction of tax selected bythe Account Manager. Within an ISA or PEP, cash can only be held pending aninvestment and if held in cash over a prolonged period there is a risk that HMRevenue & Customs may void your ISA or PEP.

7 Investment:All cash (and interest earned prior to the effective date) net of any tax whereapplicable received by us for investment in your SIP will be applied to purchaseSecurities in permitted investments. Investment will be made on or after theEffective Date. The Account Manager will be responsible for all purchases and salesof investments for your SIP. The Account Manager may aggregate any transactionfor an investor with one or more transactions for other investors, even though thismay result in a less favourable price than if it had been carried out separately.

The Account Manager will take all reasonable steps to ensure that any aggregatedtransaction is carried out on the best terms generally available in the market atthat time for transactions of a similar type and size. You have a right to inspectcopies of contract notes, vouchers and entries in the Account Manager’s book, orcomputerised records relating to transactions carried out for your account. Theserecords will be kept for at least 5 years.

8 Securities:By ticking the appropriate box on each application form, you have chosen one offour different types of return, which the Securities aim to return to investors.These returns are represented by different security types:

7 YEAR TERM(a) Annual income: payments of 7.7% of the amount you invest, payable annually

in arrears commencing on 30 June 2007.

(b) Quarterly income: payments of 1.925% of the amount you invest, payablequarterly in arrears commencing on 30 September 2006.

(c) Monthly income: payments of 0.641% of the amount you invest, payablemonthly in arrears commencing on 31 July 2006.

(d) A payment of 68% of the amount you invest, payable on 7 July 2013.

5 YEAR TERM(a) Annual income: payments of 7.5% of the amount you invest, payable annually

in arrears commencing on 30 June 2007.

(b) Quarterly income: payments of 1.875% of the amount you invest, payablequarterly in arrears commencing on 30 September 2006.

(c) Monthly income: payments of 0.625% of the amount you invest, payablemonthly in arrears commencing on 31 July 2006.

(d) A payment of 43.5% of the amount you invest, payable on 7 July 2011.

The above payments in respect of the ISA Account or the PEP Account will not besubject to either UK Income Tax or UK Capital Gains Tax and any gains or losses onyour investment will be disregarded for the purposes of UK Capital Gains Tax.

Where Securities are held as a Direct Investment into a SIP, individual investorsmay be subject, dependent on their personal circumstances, to UK income taxarising on disposal. These statements are based on current legislation,regulations and practice, all of which may change and any change could beapplied retrospectively.

9 How Investments are Held:All assets within your SIP will be, and must at all times remain, in your beneficialownership, and must not be used as security for a loan. None of the assets may belent to or deposited by way of collateral with any third party, nor may you createany charge or security over any assets. We may not lend any of your assets to athird party, nor may we borrow against their security. Securities will be registeredin the name of our nominee company, Keydata Investment Product NomineesLtd, or any such nominee approved by us. We accept full responsibility for any lossthat might arise as a result of any default by any nominee company in whichname the assets are held.

10 Documents You Receive:We will acknowledge in writing, where applicable, (i) your application to open anISA; (ii) your request to transfer a PEP or ISA to us or, as the case may be; (iii) yourapplication to open a Direct Investment. You will also receive a yearly statementprepared as at 30 June each year. This will show details of all transactions effectedduring the previous 12 months and include a valuation of your SIP. The statementwill be prepared in accordance with the rules of the FSA and will be issued within25 business days of the valuation date and will not include any measure ofcomparative performance. We may produce a consolidated statement coveringwhere applicable (i) all ISAs that are held with us; (ii) an investment statement

Head Office: Floor 8, Fountain House, 2 Queens Walk, Reading RG1 7QF. Telephone: 0118 956 3232. Registered in England. Registered No: 3714989

Issued by Keydata Investment Services Limited, which is authorised and regulated by the Financial Services Authority.

covering all PEPs held with us; and (iii) an investment statement covering allDirect Investments held with us. On request you will receive any informationissued to holders of the Securities in which you invest. On request you will beinvited to exercise voting rights in respect of Securities held. If you wish to attendinvestor meetings in person we will seek to arrange this. We reserve the right tomake a reasonable charge for providing these additional services. Where acertificate or other document evidencing title to a permitted investment isissued, it will be held by us or as we may direct.

11 Withdrawal:No partial withdrawals are permitted from your SIP.

12 Transfer to Another Manager:Subject to the Regulations, you have the right at any time to transfer your ISA toanother ISA Manager, or as the case may be, your PEP to another PEP Manager. To effect a transfer you must submit to us a written instruction and/or a letter of acceptance from your new ISA (or as the case may be PEP) Manager. You maystipulate when you wish to transfer the proceeds of your SIP but should be awareyour SIP’s proceeds will be realised in accordance with clause 13. We only effectthe transfer in cash following the sale of all securities held for you. In accordancewith the Regulations, if you wish to transfer an ISA for the current year thetransfer must be effected in respect of all the subscriptions made that year. Inrelation to ISAs and PEPs opened in respect of a previous year the transfer must be effected in respect of all holdings held in that year’s ISA or PEP. No partialtransfers will be allowed.

13 Termination:The SIP may be terminated immediately by the Account Manager on giving writtennotice to you if, in its opinion, it is impossible to administer the SIP in accordancewith the Regulations or you are in breach of the Regulations. (The ISA or PEP Planwill terminate automatically if it becomes void under the Regulations withimmediate effect. The Account Manager will notify you in writing if an ISA or PEPPlan becomes void.) The Account Manager may terminate the SIP on one month'snotice if you fail to pay any money due or are in breach of any of these Terms &Conditions. The Account Manager may at any time terminate the SIP by giving you 3 months’ notice to that effect. You may terminate the SIP at any time by givingwritten notice to the Account Manager that you wish to terminate your SIP.Following receipt the Account Manager will then sell your investments at the nextpracticable dealing date, normally at the end of each month. As with transfers youmay stipulate when you wish to realise the proceeds of your SIP but be aware thatdealing usually occurs monthly at the end of the month, and in any case will notexceed 30 days from the date of notification. Written notice of termination must bereceived by Keydata no later than 2 business days prior to the dealing date. Ontermination, the Account Manager will account to you for the proceeds ofinvestments and will be entitled to retain any cash or investments required to settleany transactions already initiated on your behalf and any outstanding fees. You willpay to the Account Manager any fees and transaction charges accrued to the date of termination.

14 Death:Should you die your ISA and/or PEP will cease to be exempt from tax, withinvestments then being held in a Direct Investment. As a Direct Investment, theAccount Manager would then await further instructions from your personalrepresentatives. An administrative charge of £65 + VAT will be levied.

15 Charges:The Secure Income Plan is designed to be held for the full term of either 5 or 7years. Should you subsequently withdraw by selling your investment at any timeduring the investment period, a withdrawal fee of £150.00 + VAT administrationcharge will be levied. Also, the cash value is not guaranteed and will depend onprevailing market conditions including, but not limited to, interest rates and theperformance of the underlying portfolio of insurance contracts. As all charges arereflected in the terms offered, the value of your investment is likely to be lessthan the amount originally invested in it, particularly during the early years of the Plan.

In addition we will benefit from the rounding of interest as per clause 6. Howeverwe reserve the right to introduce an additional charge in the future to cover anyadditional expenses incurred by us as a result of significant regulatory change. Inany event no such charge will be introduced without giving you three months'written notice.

16 Records of Your SIP:We will (a) maintain all such records relating to your SIP, (b) make such returns toHM Revenue & Customs for the purposes of taxation, and (c) provide all taxationdetails to you, as may be required under the Regulations.

17 Delegation of Functions:We may appoint a third party to act in respect of any function relevant toadministration of your SIP, though we must satisfy ourselves that any such thirdparty is competent to carry out those functions or responsibilities. We shall takefull responsibility for the actions and omissions of any such third party.

18 Assignment:We may appoint another company to be the Manager of your SIP under theseTerms & Conditions on giving you one month’s notice. The new Manager must beapproved to act as a PEP and/or ISA Manager (as applicable) by theCommissioners of HM Revenue & Customs.

19 Complaints:19 Complaints:

Any complaint should be addressed to the Compliance Officer, KeydataInvestment Services Limited, Floor 8, Fountain House, 2 Queens Walk, ReadingRG1 7QF in the first instance. If you are not satisfied with the manner in which thematter is addressed you can refer complaints relating to the administration ofyour SIP to The Financial Ombudsman Service at South Quay Plaza, 183 MarshWall, London E14 9SR. Making a complaint will not prejudice your right to takelegal proceedings. A statement describing our complaints handling procedure isavailable on request.

20 Compensation:If we cannot meet our financial obligations to you, you may be entitled tocompensation under the Financial Services Compensation Scheme establishedunder the Financial Services and Markets Act 2000. Details of your rights under thisscheme are available from us on request, and further information is available fromthe Financial Services Authority and the Financial Services Compensation Scheme. A statement describing your rights to compensation is available on request.

21 Commission:If you subscribe to a SIP through an Independent Financial Adviser we will usuallypay commission which will be detailed in correspondence with you. You shouldinform us of any change in your Adviser to enable us to keep our records up to date.

22 Data Protection:The information you provide on your application form (or subsequently) will beheld and processed by us as data controller for the purposes of the DataProtection Act 1998. We may hold and process information for the administrationof the service(s) for which you are currently applying or may apply for in future,for the operation of your investment in shares (including e.g. for registration anddistribution purposes), for the purposes of statistical analysis, and the marketingof goods or services by this company or other companies in the Keydata group.We may transfer information to other companies in the Keydata group and tothird party agents of such companies or of this company for any of the abovepurposes. Where an Independent Financial Adviser acts on your behalf, we willdisclose information concerning your investment to that Independent FinancialAdviser. Save as noted above, we will not provide to any other third party anyinformation relating to you, unless you have given your written consent or unlesswe are required to do so by law. You are entitled to request details of informationwe may hold about you upon payment of a fee and to require us to correct anyinaccuracies in your personal data.

23 Money Laundering:All transactions relating to products provided by Keydata Investment ServicesLimited are covered by The Money Laundering Requirements (Criminal Justice Act1993, The Money Laundering Regulations 2003, FSA Rules and any relevantguidance notes). This means that we are responsible for compliance with theseRegulations. As a consequence, you may be required to provide proof of identitywhen buying or selling your investment.

24 Telephone Recordings:For your security telephone conversations may be recorded.

25 Telephone and/or Internet Dealing:We reserve the right to introduce a facility for telephone and/or Internet dealingin respect of your SIP. In the event that we introduce these facilities, we willreserve the right not to accept any dealing instruction unless we are satisfied that all information which we require at the time of dealing has been accuratelyprovided.

26 Exclusion of Liability:No warranty is given by us as to the performance or profitability of the SIP. Youmust be aware that the price of securities can go down as well as up and thatthere is a degree of risk attached to your capital.

You may not get back the amount invested. You are reminded that pastperformance is no guarantee of future returns. In the event of any failure,interruption or delay in the performance of its obligations resulting from anyevent or circumstance not reasonably within its control, the Account Managershall not be liable or have any responsibility of any kind for any loss or damageyou incur or suffer as a result.

27 Insurance:The Account Manager will maintain insurance cover to indemnify you against, inter alia, misappropriation of funds or securities by any employee of the Account Manager.

28 Amendment:We may from time to time change these Terms & Conditions by giving reasonablewritten notice of any change.

29 Governing Law:These terms and conditions are governed by English law.

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