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Growth Opportunities Portfolio
Service
INFORMATION MEMORANDUM
____________________________________________________
FOR UK INVESTORS ONLY
bamboocapital.co.uk
October 2016
BAMBOO GROWTH OPPORTUNITIES PORTFOLIO SERVICE
bamboocapital.co.uk
October 2016
FOR UK INVESTORS ONLY
Bamboo Growth Opportunities Portfolio Service: a portfolio of early stage UK companies (unquoted and AIM listed) and/or more mature AIM listed companies, each with the potential for higher investment returns over the long-term (more than three years) when compared with portfolios of FTSE 250 companies.
Investors can also take advantage of attractive potential inheritance tax reliefs, as well as capital gains tax advantages (if investing through an ISA). Investors can also invest through their self-invested pension plan (SIPP).
Investors can also separately invest in the Bamboo EIS Portfolio Service to access significant income tax, capital gains tax and inheritance tax benefits.
Contents
Welcome to Bamboo Growth Opportunities ........................................................................... 1
Section 1 ......................................................................................................................... 2
Bamboo Growth Opportunities Portfolio Service .................................................................... 2
Investment Team and Advisory Committee .......................................................................... 3
Investment Approach ........................................................................................................ 5
Investment Process ........................................................................................................... 6
The Bamboo Capital Network .............................................................................................. 7
Section 2 ......................................................................................................................... 9
Potential tax benefits of Bamboo Growth Opportunities Investment ......................................... 9
Section 3 ........................................................................................................................ 10
The Charges .................................................................................................................... 10
Section 4 ........................................................................................................................ 15
The Risk Factors and Conflicts of Interest ............................................................................ 15
Section 5 ........................................................................................................................ 18
Investor Agreement ......................................................................................................... 18
Section 6 ........................................................................................................................ 31
Custodian Agreement ....................................................................................................... 31
Section 7 ........................................................................................................................ 48
Definitions ...................................................................................................................... 48
Section 8 ........................................................................................................................ 50
Frequently Asked Questions .............................................................................................. 50
IMPORTANT INFORMATION
This Information Memorandum, constitutes a financial promotion for the purposes of section 21 of the FSMA and is issued by Bamboo. This Information Memorandum does not constitute a prospectus for the purposes of the Prospectus Rules.
Bamboo Capital Management Limited is a private limited company incorporated under the laws of
England and Wales (company number 10076053) and is authorised and regulated by the FCA (FRN number742299).
This Information Memorandum should be read in conjunction with the Investor Agreement and Application Form. This Information Memorandum may be distributed to persons falling within the
following categories of investor:
(a) existing clients of a financial adviser regulated by the FCA;
(b) persons who meet the criteria for being a professional client;
(c) persons who qualify as certified high net worth individuals in accordance with COBS 4.7.7(a);
(d) persons who qualify as certified sophisticated investors accordance with COBS 4.7.7(b);
(e) persons who qualify as self-certified sophisticated investors in accordance with COBS 4.7.7(c); and
(f) persons who confirm that they will only invest ten per cent (10%) of their net assets in non-readily realisable securities by signing the Restricted Investor Statement set out in COBS 4.7.10.
This document is not available to persons outside the United Kingdom and does not constitute an
offer or invitation to invest in any company to any such persons. By accepting this Information Memorandum, you represent and warrant to Bamboo that you are a person who falls within the above description of persons in respect of whom Bamboo has approved distribution of this Information Memorandum as a financial promotion. This Information Memorandum is not to be disclosed to any other person or used for any other purpose. Any other person who receives this
Information Memorandum should not rely on its contents.
By applying to the Bamboo Growth Opportunities Portfolio Service, you are confirming that you are aware of the risks associated with non-readily realisable investments. It is very important that you read and fully understand the risks involved with this investment so that you can decide whether it is right for you – these risks are outlined in Section 4 of this Information Memorandum. The value of an investment in this product may go down as well as up and you may lose all the money you
invest. Investments into smaller companies are likely to have higher volatility than shares listed on the main London Stock Exchange. Further, investments in unquoted companies may take longer to sell than listed shares, and it is not possible to predict how long it will take to sell specific investments. The Bamboo Growth Opportunities Portfolio Service will not be appropriate for all potential investors. You should seek advice from a financial adviser, authorised and regulated by the FCA, before deciding whether or not to invest.
You will note from this Information Memorandum that investors are required to commit funds to the Bamboo Growth Opportunities Portfolio Service for not less than three years. This is due to the nature of the proposed investments (which customarily require time to realise their growth
potential). If you may require your funds within three years of investment, the Bamboo Growth Opportunities Portfolio Service is not for you.
The Growth Opportunities Portfolio Service is an Alternative Investment Fund for the purposes of the Alternative Investment Fund Managers Directive (2011/61/ EU) (“AIFMD”). The Bamboo Growth Opportunities Portfolio Service is not a collective investment scheme within the meaning of section 235 of the Financial Services and Markets Act 2000, nor a Non-mainstream Pooled Investment by virtue of it being a fund complying within the meaning of Article 2 of the Schedule to the Financial
Services and Markets Act 2000 (Collective Investment Schemes) Order 2001 and, pursuant to clause 15 of the Investor Agreement, Investors are entitled only to the withdrawal rights prescribed by that clause 15. Investors in the Bamboo Growth Opportunities Portfolio Service will make Investments together and their Investments will be managed by Bamboo on a common basis. The Growth Opportunities Portfolio Service will, therefore, constitute a collective investment undertaking within the meaning of the Markets in Financial Instruments Directive (“MiFID”) and, by virtue of the exemption for collective investment undertakings and their operators in Article 2.1(h)
of MiFID, the Bamboo Growth Opportunities Portfolio Service (and the management by Bamboo
thereof) falls outside the remit of MiFID.
Prospective investors are advised that the Portfolio Manager is authorised by the FCA as a small authorised UK Alternative Investment Fund Manager. Prospective investors’ attention is drawn to
the fact that the Bamboo Growth Opportunities Portfolio Manager is exempted from the AIFMD pursuant to Article 3(2)(a) of the AIFMD (the so-called “de minimis exemption”). Therefore, prospective investors shall not benefit from any rights from the AIFMD, nor will the Portfolio Manager comply with any obligation thereunder, except to the extent provided under Article 3(2) of the AIFMD.
All Investors in the Bamboo Growth Opportunities Portfolio Service will, for the purposes of FCA conduct of business rule 18.5 only, be categorised by Bamboo as retail clients unless otherwise agreed by Bamboo and the Investor. For the avoidance of doubt, as the Portfolio Service is an Alternative Investment Fund, the Portfolio Manager will, for regulatory purposes, treat the Portfolio
Service as its client and, other than as set out above, will not owe any client obligations under FCA
Rules to Investors. Please do remember that tax rules and regulations are subject to change. Tax treatment also depends on your individual circumstances and we recommend you seek advice to confirm this product is right for you. Please note that all the figures and information provided within
this document are correct at 26 September 2016. When reading this Information Memorandum, please note that certain words and phrases have the meanings set out in Section 7 (Definitions).
1
WELCOME TO BAMBOO GROWTH OPPORTUNITIES
As an investor with us, you can be assured that we understand that wealth is not easily
earned – we treat your money carefully and invest it as if it were our own.
Bamboo is pleased to introduce the Bamboo Growth Opportunities Portfolio Service. This is a management service specialising in investments into early stage UK companies (unquoted and AIM listed) and/or more mature AIM listed companies.
Bamboo aims to give investors access to institutional IPOs and placings on AIM.
Investors may see the Bamboo Growth Opportunities Portfolio Service as complimentary to the
Bamboo EIS Portfolio Service, which similarly aims to invest in early stage UK companies (and in some circumstances, AIM listed companies), but with the additional aim of securing EIS qualifying investment tax advantages.
Bamboo has brought together a first-rate team of finance, investment and legal professionals which has an enviable contact-base of entrepreneurs, senior professionals, industry leaders, investment
bankers, brokers and other intermediaries. This give us access to exceptional investment opportunities.
Our team has extensive experience in both quoted AIM company investment and private company investment (particularly pre-IPO).
Our aim is to identify and develop well managed businesses which demonstrate the potential for significant growth in their sector or market.
We believe that the Bamboo Growth Opportunities Portfolio Service represents a compelling investment proposition, both in terms of the attractive potential tax benefits (see section 2 of this Information Memorandum) and the potential for significant capital growth. Investors are also able to invest through their SIPP.
The Bamboo Growth Opportunities Portfolio Service is not appropriate for all potential investors – it
is important that you read and fully understand the Risk Factors, so that you can decide whether the
Bamboo Growth Opportunities Portfolio Service is right for you.
We have endeavored to ensure that this Information Memorandum is clear and transparent as to the investment proposition and the Risk Factors.
Nonetheless, we always recommend that you speak with your financial adviser before making an investment.
Simon Woolley
Founder and CEO
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SECTION 1
BAMBOO GROWTH OPPORTUNITIES PORTFOLIO SERVICE
Objective
An investment with the potential to deliver significant returns, as well as a number of
attractive tax benefits.
The Bamboo Growth Opportunities Portfolio Service will invest in UK companies across a range of industry sectors. Each Investee Company will have the potential for significant capital growth. The Portfolio may be either unquoted companies (namely companies whose shares are not publicly listed
on a stock exchange) and/or companies that are already listed on AIM. A particular focus will be institutional IPOs and placings on AIM. The aim of the Portfolio Manager is that all Investee Companies are BPR qualifying.
Investors who could benefit
The Bamboo Growth Opportunities Portfolio Service is suited to investors who are willing to take on a higher level of risk in the pursuit of stronger returns over the longer term. Potential investors may find investing in early-stage, fast growing companies, attractive, but may not know how to (or have the time to) manage a portfolio of such companies, or be able to access a reliable deal flow of investment opportunities. Investors may not have the ability to carry out due diligence and/or
access industry expertise in relation to proposed investments. Investors are also unlikely to have access to institutional IPOs and placings on AIM.
Investments are selected by the investment team on behalf of Bamboo Growth Opportunities Portfolio Service investors. The Bamboo Growth Opportunities Portfolio Service is a discretionary collective portfolio management service, and we believe it is the best way for investors to capture
the growth and diversity of UK smaller companies.
An investment in the Bamboo Growth Opportunities Portfolio Service is designed to be held for the long term in order to achieve the targeted capital growth. The strategy of the Portfolio Manager is to find a range of suitable companies for an Investor’s portfolio and this may take up to twelve
months. Also, the nature of certain of the proposed Investments means that it will take a significant period of time for those companies to realise their growth potential. It may take even longer than this to sell all an Investor’s holdings (particularly in the case of unquoted companies) if they decide to withdraw their money. For this reason, Bamboo Growth Opportunities Portfolio Service investors should be willing to invest their capital for a minimum period of three years.
The tax advantages available through the Bamboo Growth Opportunities Portfolio Service provide you with an additional potential inheritance tax benefit, as well as capital gains tax advantages (if investing through an ISA).
Investors can also separately invest in the Bamboo EIS Portfolio Service to access significant income tax, capital gains tax and inheritance tax benefits.
3
INVESTMENT TEAM AND ADVISORY COMMITTEE
The Bamboo Growth Opportunities Portfolio Service team of experienced finance, investment, legal
and M&A professionals.
The team has significant experience in the whole life cycle of investment – transacting acquisitions and investments, managing growth in dynamic fast moving businesses and consummating exits.
As referred to in the explanation of our Investment Process below (page 6), whilst the Portfolio Manager has the responsibility for investment origination, structuring, execution and portfolio management, the Advisory Committee provides ongoing advice and recommendations, as well as reviewing and challenging the investment policies, strategies, prospective investments and performance of the Bamboo Growth Opportunities Portfolio Service.
The Advisory Committee currently comprises:
Simon Woolley
Simon is the Founder and CEO of Bamboo.
Simon has significant experience as an advisor, manager and business owner.
As a qualified solicitor, Simon started his career in the City of London and then worked for DLA Piper for 16 years (12 years as a Partner) – he was Managing Partner of the DLA Piper, Manchester office (350 staff) from 2006 to 2009 and a main board member of DLA Piper International, governing DLA Piper globally (other than the United States).
More recently, Simon has formed his own start-up advisory businesses (legal, business and strategic) and has first-hand experience of the needs and challenges of growing businesses.
Simon has advised on over 400 deals, ranging from £0.5 million to £1.1 billion (including the £950 million public to private of Arcadia Group; the £715 million purchase of the Daily Telegraph; and the
£70 million flotation of Safestyle).
Simon has an extensive contact base across the institutional and venture fundraising sectors, as well as banks, private equity houses and professional services.
Simon is also a non-executive director of REACT Group plc.
Ross Andrews
Ross has had a successful career in corporate finance spanning over 30 years.
After starting his career working for The London Stock Exchange, Ross gained his experience through working in senior positions for well-regarded corporate finance businesses in London, the Midlands and Manchester.
From 2008 to late 2015, Ross was a main board director of Zeus Capital, during which time the firm grew from a small corporate finance advisory business to an established investment banking operation.
Ross specialised in the AIM market, in terms of IPOs, fundraisings and general advisory services.
Ross was head of PLC Advisory at Zeus Capital – during his tenure, the average market capitilisation of clients was raised from sub-£10 million to in excess of £100 million.
As well as numerous other flotations and fundraisings, Ross advised on the largest IPO to date on AIM (Boohoo) and one of the largest pharmaceutical IPOs (Quantum Pharma).
Ross remains actively involved in the AIM sector.
Ross brings a wealth of experience and contacts to the Advisory Committee, particularly in relation to businesses whose strategy is to float on AIM.
Ross is a member of the Chartered Institute for Securities and Investment.
4
He is an Approved AIM Qualified Executive
Mike Fletcher
Mike is a co-founder and managing partner of Praetura Capital LLP, a business specialising in venture investment and corporate advisory services
Praetura Capital, which was incorporated in 2011, has made a number of venture investments across a variety of market sectors.
Mike sits on the board of a number of Praetura Capital’s investments (including PIB Limited, EC3 Brokers, Praetura Asset Finance Limited, Artorius Holdings Limited and Starcount Pte Limited).
He is also a non-executive director of AIM listed companies Fairpoint Group Plc and Inspired Energy plc.
Mike was previously a managing director of investment bank Altium Capital Limited.
He has over 15 years’ experience in mergers and acquisitions and corporate finance, advising public companies, private equity houses and entrepreneurs.
As well as experience of institutional fundraising and advisory, Mike brings experience of investing in, and working with, early stage entrepreneurial businesses with high growth potential.
Mike is a Chartered Accountant (having qualified with PwC in 1999).
5
INVESTMENT APPROACH
Bamboo Growth Opportunities investments will be made into a combination of AIM quoted
companies and unquoted companies.
Bamboo will act as Portfolio Manager and is responsible for sourcing investment opportunities, as well as structuring, evaluating and executing completion of these investments.
Bamboo will utilise its enviable network of professional contacts, entrepreneurs and other intermediaries to source deals for evaluation.
Bamboo will adhere to strict investment criteria when selecting potential investment opportunities.
Our principal concern with any investment is the management team.
If we are not content with the quality of the management team, we will not invest.
Assuming that this key requirement is met, our other fundamental investment considerations are:
attractive market or sector;
potential for strong growth in that market or sector;
strong underlying business fundamentals;
defensible market position; and
in the case of proposed unquoted investments:
o the potential to improve stakeholder value through financial or operational structural changes;
o realistic expectations of investment entry valuation; and
o realistic exit routes within 3 to 4 years of investment.
6
INVESTMENT PROCESS
Any decision by Bamboo to invest Bamboo Growth
Opportunities Portfolio Service funds involves a detailed and rigorous process.
Once invested, our process also ensures that each investment is closely monitored.
The Bamboo investment process can be summarised as follows:
Initial due diligence and analysis
The Bamboo team will produce a summary paper of the potential investment analysing:
the business (including the management team);
the market;
the potential of the business and threats to it;
the current financial position and requirements;
the likely investment entry price; and
the exit strategy and horizon.
Detailed due diligence
Assuming the investment opportunity has progressed beyond the initial due diligence stage, an investment paper is produced (which may include appropriate due diligence recommendations and findings by the Bamboo
team and/or external due diligence providers - legal, commercial, management, financial and/or market). The deal structure and heads of terms will also be
finalised (if applicable).
The investment paper is then considered by the Advisory Committee, who produce a summary investment paper for the Portfolio Manager containing a recommendation on whether or not to invest.
The final decision whether to invest is taken by the
Portfolio Manager.
Post investment monitoring and management
The Portfolio Manager will regularly update the Advisory Committee in respect of each Investee Company.
In the case of unquoted investments, management information will be reviewed by the Portfolio Manager
and reported on to the Advisory Committee.
Performance of the business against plan (if applicable), as well as against the exit horizon, is carefully monitored and managed.
Follow-on AIM investment
Following the initial investment in an AIM listed company, the Portfolio Manager may increase or reduce
the investment into any such AIM listed Investee Company in line with its investment strategy.
Spending time with the management team
Interrogating the financials and
business plan
Portfolio Manager regularly updates
Advisory Committee
Portfolio Manager monitors each
investment
Deal origination
Decision on investment proposal by
Portfolio Manager
7
THE BAMBOO CAPITAL NETWORK
In relation to investments in unquoted companies, we provide those companies with not
only finance, but also expertise and ongoing guidance, from people who have been there and done it before.
We are also able to tap in the Bamboo Capital network for focused support.
The Bamboo team have a long-established network of entrepreneurs, senior professionals, industry leaders, investment bankers and other intermediaries.
The network is invaluable when carrying out due diligence, in providing ongoing monitoring of
Investee Companies and in considering exit options.
8
HOW TO INVEST
If you have a financial adviser
Please contact them in the first instance and they will help you set up your Bamboo Growth Opportunities Portfolio Service. Your adviser can call us on 0207 769 6842 or visit us at www.bamboocapital.co.uk.
If you are investing directly
Please call our team on 0207 769 6842 and we will talk you through the process. We will also send you any forms you need.
This Information Memorandum contains the form of Investor Agreement and Custodian Agreement (Section 5 and 6) to be entered into by each Investor (see section 5). Please be sure to read these carefully.
As stated in this Information Memorandum, Bamboo does not provide any investment or tax advice
to any potential Investor and recommends that the potential Investor seeks advice from his financial adviser (or consults another financial adviser who is appropriately qualified and authorised to give investment and tax advice).
9
SECTION 2
POTENTIAL TAX BENEFITS OF BAMBOO GROWTH OPPORTUNITIES INVESTMENT
Please note that (as stated in Clause 7 of the Investor Agreement), the Portfolio Manager does not provide any investment or tax advice to any Investor and recommends that the Investor (or potential Investor) seeks advice from his financial adviser (or consults another financial adviser who is appropriately qualified and authorised to give investment and tax advice). The information below is
for information purposes, in respect of which the Investor (or potential Investors) should take advice.
A Bamboo Growth Opportunities Portfolio investment offers the following potential tax benefits:
Inheritance tax relief
BPR can be a valuable relief for individuals who invest in BPR qualifying companies.
BPR, where it is available, provides up to one hundred per cent (100%) exemption from inheritance
tax.
The full one hundred per cent (100%) relief is only available for shareholdings in certain unquoted companies, which (importantly) for these purposes, includes AIM listed shares.
Each relevant shareholding must be held for at least two years prior to death in order to qualify for BPR.
ISA capital gains tax free growth
There is no capital gains tax to pay if your Bamboo Growth Opportunities Portfolio Service investment (if subscribed through an ISA) increases in value and the amount invested and has not been withdrawn.
Pension investment
Investors are able to invest in the Bamboo Capital Growth Opportunities Portfolio Service through
their SIPP.
10
SECTION 3
THE CHARGES
Portfolio Manager charges
The Portfolio Manager has a charging structure which is reasonable, competitive and commercially
aligned to a successful outcome for the Investor – see below.
Initial fee
An initial fee, calculated at the rate of two per cent (2%) of Subscriptions, is payable to the Portfolio Manager.
The costs of establishing the Portfolio Service, legal and taxation advice costs, the costs for preparing and issuing the Information Memorandum and other direct expenses incurred will be borne by the Portfolio Manager out of this fee.
This initial fee will be deducted from Subscriptions.
Annual management fee
The Portfolio Manager will charge an annual management fee, calculated at a rate of two per cent (2%) of the Net Subscription Amount (as defined below).
For these purposes, “Net Subscription Amount” means, in respect of a Subscription, the amount of such Subscription minus the aggregate of:
(a) the initial fee payable to the Portfolio Manager (see Initial fee above);
(b) the aggregate amount of Custodian charges retained in cash from the Subscription (see Payment of Custodian fees below); and
(c) the aggregate amount (if any) of any initial and/or ongoing financial adviser fees (where the
Investor has instructed the Portfolio Manager to facilitate the payment of such fees (see Initial
and ongoing financial adviser fees below);
The annual management fee accrues from the date on which the Custodian accepts the Application Form.
The Portfolio Manager shall deduct the annual management fee from uninvested cash in the Portfolio and/or the proceeds of realisation of Investments.
Performance fees
Annual performance fee
The annual management fee is to cover the operational costs of providing the Bamboo Growth Opportunities Portfolio Service.
The commercial return for the Portfolio Manager comes through a performance fee, which again is
linked to a successful outcome for the Investor.
No Performance fee is payable until all other fees and expenses due and payable have been paid.
The annual performance fee is calculated:
(a) as at each GAV Calculation Date; and
(b) is payable at a rate of twenty per cent (20%) on the increase in GAV above the High Water Mark since the last GAV Calculation Date,
provided that the increase in GAV as at the first GAV Calculation Date shall be calculated by reference to the amount (if any) by which GAV as at such first GAV Calculation Date exceeds the Net Subscription Amount.
11
By using the High Water Mark, this ensures that the Portfolio Manager does not (unlike some others)
receive a performance fee for an increase in performance following under-performance.
Super-performance fee
The super-performance fee is:
(a) calculated as at the date on which the investment of an Investor in an Investee Company is fully realised; and
(b) payable if the realisations of the Investor in respect of such Investee Company exceed two hundred and fifty per cent (250%) of the original amount(s) invested by the Investor in that
Investee Company (the amount of such excess is referred to as the “Super-performance Excess Amount”).
In the event that the super-performance fee becomes payable, the Portfolio Manager will be entitled to a super-performance fee at the rate of fifty per cent (50%) of the Super-performance Excess Amount.
The Portfolio Manager shall deduct performance fees from uninvested cash in the Portfolio and/or the proceeds of realisation of Investments
Other fees and expenses
The Portfolio Manager (or any Associate) may charge Investee Companies arrangement, monitoring or other fees (including fees in respect of any person acting as a director or other officer of any such Investee Company). The Portfolio Manager may also engage external advisers and consultants in
connection with investments in, and realisations of, Investee Companies and fees arising may be deducted by the Portfolio Manager from any proceeds of realisation of Investee Companies.
VAT
All Portfolio Manager fees may be subject to Value Added Tax.
Custodian charges
Custodian annual administration fees
The Custodian charges an annual administration fee of £75 (plus VAT)
Custodian transaction fees
The Custodian charges 0.35% of the value of any shares purchased or sold.
VAT is not payable on Custodian transaction fees.
Payment of Custodian fees
The Custodian, will upon receipt of a Subscription, ensure that there is sufficient uninvested cash
held in the name of the Investor to discharge the following Custodian fees:
(a) the annual administration charge for the first five years - £375 (plus VAT); and
(b) 0.35% of the Net Subscription Amount (as defined above), to cover the purchase of shares into the Portfolio of the Investor.
Financial adviser fees
Initial and ongoing financial adviser fees
An Investor may seek the advice of a financial adviser in relation to an investment in the Bamboo Growth Opportunities Portfolio Service and may agree to pay fees to such financial adviser for any
initial and/or ongoing advice.
12
If the Investor has agreed to pay fees to a financial adviser for initial and/or ongoing advice, the
Investor can authorise Bamboo to facilitate the payment of such fees by completing the authorisation in the Application Form.
In these circumstances, the Custodian will:
(a) deduct an amount equal to the initial fee from the Subscription and pay the initial fee to the financial adviser; and
(b) ensure that an amount equal to four times the agreed ongoing financial adviser fee is held in cash in the name of the Investor, out of which the ongoing financial adviser fees will be paid as and when they become due.
Tax treatment of financial adviser fees
Where Bamboo is facilitating the payment of fees to financial advisers, these fees will not count towards the amount subscribed to the Bamboo Growth Opportunities Portfolio Service (or available for investment in Investee Companies. Please see illustrations below.
13
ILLUSTRATIONS
Subscriptions
Example 1 – Subscription with no financial adviser fees facilitated through the Portfolio Manager
The Investor sends a cheque for £100,000 to the Custodian.
He has not requested Bamboo to facilitate any fees to his financial adviser.
Cheque sent to Custodian £100,000
(2% + VAT of £100,000)
Portfolio Manager initial
fee £2,400 £97,600
Charges deducted from Subscription
(£375 plus VAT, plus 0.35% of
£98,000)
Custodian fees £791.60 £96,808.40
Net amount available for
investment in the Bamboo
Growth Opportunities
Service
£96,808.40
14
Example 2 – worked example of Subscription with initial and ongoing financial adviser
fees facilitated through the Portfolio Manager
The Investor sends a cheque for £100,000 to the Custodian.
He has agreed an initial charge of two per cent (2%) and a charge of one per cent (1%) per annum
with his financial adviser for advice in relation to the Bamboo Growth Opportunities Portfolio Service
and has instructed the Portfolio Manager to facilitate these payments to the Financial Adviser.
Cheque sent to Custodian £100,000
(2% of £100,000)
Initial financial adviser
charge £2,000 £98,000
(2% + VAT of £100,000)
Portfolio Manager initial
fee £2,400 £95,600
(1% of £100,000 for four years)
Cash retained to pay
ongoing financial adviser
charges
£4,000 £91,600
(£375 plus VAT, plus 0.35% of
£91,600)
Custodian fees £770.60 £90,829.40
Net amount available for
investment in the Bamboo
Growth Opportunity
Portfolio Service
£90,829.40*
Charges deducted from Subscription
*Please note that where the Portfolio is instructed to facilitate the payment of initial and/or ongoing fees
to a financial adviser, this will reduce the amount available for investment in the Bamboo Growth
Opportunity Portfolio Service
15
SECTION 4
THE RISK FACTORS AND CONFLICTS OF INTEREST
Everything you do involves risks, which you constantly balance against the possible rewards. Investing is just the same.
The Bamboo Growth Opportunities Portfolio Service is a high-risk product and may not be suitable for all investors. If you are thinking of investing, we recommend that you first seek independent advice. Please note that Bamboo is not able to advise you on whether or not you should invest in this product.
The following is a list of some of the risks that a potential Investor should consider. The list is by no means exhaustive.
Past performance
The past performance of the investment team, or any of the companies in which any of them have
previously invested, is not a reliable guide to how this product will perform in future. There is no guarantee that the Bamboo Growth Opportunities Portfolio Service will achieve its objective. We can make no guarantee of investment performance or the level of growth that will be generated.
Your capital is at risk
The Bamboo Growth Opportunities Portfolio Service will invest in shares and securities issued by unquoted companies, or companies quoted on AIM. Your capital and investment return are not guaranteed and you may not receive back all of the money which you invest. There is a possibility
that investments in some of the companies will be completely lost.
Your investment horizon and strategy
You should consider the Bamboo Growth Opportunities Portfolio Service a long-term investment.
An investment into the Bamboo Growth Opportunities Portfolio Service is for a minimum period of three years from the date of investment. Further, investments in unquoted and AIM-traded
companies are likely to present a higher risk to your capital than holdings in companies on the main London Stock Exchange. You should not invest in this product unless you have thought carefully about whether you can afford the losses you may incur, and whether it is right for you. As investments into small, unquoted, and/or AIM-quoted companies are likely to have higher volatility
than shares listed on the main London Stock Exchange, the Bamboo Growth Opportunities Portfolio Service has been designed with the aim of performing over a timeframe of at least three years. Each investment in an BPR qualifying company needs to be held for at least two years from the date of investment in order to retain the BPR benefits.
Liquidity risk
Investments in unquoted and AIM-quoted companies made by the Bamboo Growth Opportunities Portfolio Service are likely to be more difficult to sell than investing in companies on the main London Stock Exchange. Accordingly, while we will always attempt to redeem your investment if you ask to withdraw your money (after the minimum three year investment period), this will not
always be possible. In particular, it is not always possible to sell holdings in unquoted companies.
Investors should therefore be aware it could take several years before such shares can be sold, and the timing of sales cannot be predicted.
Current legislation and tax reliefs
Rates of tax, tax benefits and allowances described in this Information Memorandum are based on current legislation and HM Revenue & Customs (HMRC) practice. These may change from time to time and are not guaranteed. Any tax benefits associated with an investment into the Bamboo Growth Opportunities Portfolio Service are based on the personal circumstances of the individual investor.
The Bamboo Growth Opportunities Portfolio Service has been designed with UK resident taxpayers in mind. If you are not resident in the UK for tax purposes, it may not be appropriate or advantageous for you to invest in this product.
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Reliance of senior management
Investee Companies, by virtue of their size, are likely to be more reliant on the skills and management
of a smaller executive team. In the event that an Investee Company loses a key manager, this could have an adverse effect on such Investee Company which is disproportionate when compared to the loss of a senior executive at a larger more established company.
Suitable investment opportunities
The Portfolio Manager may not be able to source a sufficient number of attractive opportunities and may not achieve the investment objectives set out in this Information Memorandum, or fully invest the amount subscribed by an Investor in the Portfolio Service.
Investor team availability
The success of the Portfolio Service will depend in part upon the skill and expertise of the Portfolio Manager and the continued availability of the senior investment team of the Portfolio Manager.
Terms of realisation
Any form of realisation of an Investment may contain restrictions on the shareholders of the Investee Company, such as (in the case of an Investment in unquoted company) delayed payment for a portion
of the price paid for the Investee Company (pending, for example, the achievement of certain commercial milestones). In the case of an IPO of the shares of an Investee Company, a restriction on shareholders' ability to sell shares for a limited period of time following the IPO may be imposed in order to ensure an orderly market. It may also be the case that some or all of the price paid for the shares in an Investee Company will be satisfied by the issue of securities in the purchaser company (rather than cash).
Maintenance and timing of Growth Opportunities tax reliefs
The Bamboo Growth Opportunities Portfolio Service invests in companies that we reasonably believe qualify for BPR. However, there is no guarantee that such companies will be, and will remain, BPR
qualifying companies.
The Portfolio Manager cannot guarantee that Investments made will qualify for BPR. HMRC will conduct a BPR assessment in relation to each Investment after the death of the Investor, in order to determine whether or not BPR applies at that time.
The Portfolio Manager retains complete discretion to realise any Investment, including within the Minimum Period, in which case some or all of the tax reliefs may be lost.
The dates on which BPR relating to an investment in an Investee Company is available will vary
depending on the date on which BPR qualifying investments are made. There can be no guarantee as to the availability and timing of the making of BPR qualifying investments.
The tax reliefs referred to in this Information Memorandum (particularly in Section 2) are those currently available. Levels, bases of, and relief from taxation are subject to change. Any such change could be
retrospective. Potential investors should consult their own tax advisers before making any investment in the Bamboo Growth Opportunities Portfolio Service.
The Bamboo Growth Opportunities Portfolio Service is an investment for capital growth, not primarily to secure tax benefits.
Conflicts of interest
There may be occasions when the interests of one group of investors may conflict with those of another group (such as other investors or Bamboo). Where conflicts arise, controls are essential to
ensure that Investors are always treated fairly. Bamboo has a conflicts of interest policy in place pursuant to the FCA Rules, which sets out how Bamboo identifies and manages conflicts of interest. A summary of the Conflicts Policy is available at www.bamboocapital.co.uk. Investors are required to read and agree to this policy in order to make an investment into the Bamboo Growth Opportunities Portfolio Service.
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When could conflicts of interest be beneficial to investors?
The team may invest funds from other Bamboo managed funds (including, without limitation, the
Bamboo EIS Portfolio Service) alongside funds from the Bamboo EIS Portfolio Service. As a result of this co-investment, investors in the Bamboo EIS Portfolio Service can have access to investment opportunities that may not have been possible without being part of the larger deal with other Bamboo funds. In the case of our unquoted investments, we will often place someone on the board of directors of an Investee Company (either as a monitor or a director). Bamboo takes an annual fee for this service from the Investee Company, but this means we are able to closely monitor the
investment we have made on behalf of our investors. If we appoint a director, that director has a legal obligation to act with the interests of all shareholders in the Investee Company, not just the interests of Investors.
When could conflicts of interest be detrimental to investors?
In the case of an unquoted company, we may have what we believe to be a good opportunity, but unfortunately are unable to invest as much of one group of our investors’ money as we would like,
due to restraints such as the size of company or the amount of investment that qualifies for available tax reliefs. In these instances, investors from different Bamboo managed sources may only be able to invest an amount which is pro-rated down to ensure a fair distribution.
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SECTION 5
INVESTOR AGREEMENT
This Investor Agreement sets out the agreement between the Portfolio Manager and the Investor in relation to an investment in the Portfolio Service.
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THIS INVESTOR AGREEMENT (THE “AGREEMENT”) WILL CONSTITUTE A BINDING AGREEMENT
BETWEEN THE INVESTOR AND THE PORTFOLIO MANAGER ONCE THE INVESTOR HAS RETURNED A VALID AND SIGNED APPLICATION FORM TO THE CUSTODIAN, CLEARED FUNDS HAVE BEEN RECEIVED FROM THE INVESTOR BY THE CUSTODIAN, ANY CLIENT DUE DILIGENCE HAS BEEN
COMPLETED TO THE SATISFACTION OF THE CUSTODIAN AND THE CUSTODIAN HAS NOTIFIED THE INVESTOR THAT HIS/HER APPLICATION HAS BEEN ACCEPTED.
1. Definitions and interpretation
1.1 This Agreement employs the same defined terms as are found in Section 7 of the Information Memorandum.
1.2 Words and expressions defined in the Financial Conduct Authority (“FCA”) Rules (the “FCA Rules”) which are not otherwise defined (in or for the purposes of) this Agreement, shall,
unless the context otherwise requires, have the same meanings when used in this Agreement.
1.3 Any reference to a statute, statutory instrument or to rules or regulations shall be references
to such statute, statutory instrument or rules and regulations as from time to time amended, re-enacted or replaced and to any codification, consolidation, re-enactment or substitution
thereof as from time to time in force.
1.4 References to the singular only shall include the plural and vice versa.
1.5 References to the masculine gender shall include the feminine gender.
1.6 Unless otherwise indicated, references to Clauses or the Schedule shall be to Clauses in, or the Schedule to, this Agreement.
1.7 Headings to Clauses are for convenience only and shall not affect the interpretation of this Agreement.
2 Opening a Bamboo Growth Opportunities Portfolio Service account
2.1 By signing the declaration in Section 6 of the Application Form, the Investor agrees to be
bound by the terms and conditions of this Agreement and the Information Memorandum.
2.2 The Investor hereby appoints the Portfolio Manager to manage the Portfolio for the Investor.
The Portfolio Manager agrees to accept its appointment and obligations upon the terms set out in this Agreement and the Information Memorandum.
2.3 The Portfolio Manager is authorised and regulated by the FCA with registration number FRN 742299. The FCA is situated at 25 North Colonnade, Canary Wharf, London E14 5HS. The Portfolio Manager has categorised the Investor as a retail client for the purposes of the FCA
Rules. This categorisation has been determined in accordance with the internal client categorisation process of the Portfolio Manager. You may request a different categorisation, but as retail clients are generally afforded a higher degree of protection than other clients, the Portfolio Manager reserves the right to reject such requests.
2.4 The Investor has the right to cancel this Agreement for a period of up to 14 days from the date on which the Portfolio Manager accepts the Application Form from the Investor. If the
Investor wishes to cancel this agreement, he must submit a cancellation request in writing to the Custodian within such 14 day period. In the event of cancellation, the Investor will, within 28 days of receipt of the cancellation request, receive back from the Custodian the amount subscribed by him in the Application Form, net of the reasonable processing costs of the Custodian. All further provisions of this Agreement shall then cease to apply.
3 Subscriptions
3.1 The Investor shall make an initial Subscription of not less than £25,000 at the same time as
submitting his Application Form. There is no maximum amount which may be subscribed.
3.2 The Investor may make further Subscriptions to the Portfolio Service in multiples of £5,000 at any time prior to the termination of the Portfolio Service. The Portfolio Manager aims to invest Subscriptions (net of fees) within 24 months of receipt.
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3.3 The Investor may only terminate this Agreement (after the cancellation period referred to in
Clause 2.4) pursuant to the provisions of Clause 15.
4 Operation of the Bamboo Growth Opportunities Portfolio Service
4.1 The Portfolio Manager will (subject to the provisions of Clause 2.4) undertake the Portfolio Service for the Investor from the date following 14 days after acceptance of the relevant Application Form upon, and subject to, the provisions of this Agreement. The Portfolio
Manager will exercise all discretionary powers in relation to investments (including selecting potential investee companies for proposed Investments) on the terms set out in this Agreement (including, without limitation, the exercise of all conversion, subscription, voting and other rights such as may arise in respect of such Investments and any decision to sell, redeem or otherwise realise all or any part of such Investments on behalf of the Investors).
4.2 The Portfolio Manager has engaged the Custodian to provide administration and safe custody services in relation to (a) the Investments and (b) any cash received by way of Subscriptions or otherwise.
4.3 The Portfolio Manager is responsible for appointing the Advisory Committee. Details of those
persons who will form the Advisory Committee at the commencement of the Portfolio Service are set out in the Information Memorandum. Members of the Advisory Committee may change from time to time.
4.4 The Portfolio Manager shall not (except as expressly provided in this Agreement or unless
otherwise authorised) have any authority to act on behalf of, or in respect of the Investor, or to act as the agent of the Investor.
4.5 The Portfolio Manager will arrange investment transactions in relation to the Investments and has agreed to undertake various responsibilities (such as sourcing potential investments, conducting due diligence, monitoring performance and arranging appropriate exits).
4.6 In performing its services, the Portfolio Manager shall have regard to the Investment Objectives.
4.7 The Portfolio Manager reserves the right to return uninvested cash to an Investor if the Portfolio Manager concludes that it cannot be properly invested for such Investor and/or if the Portfolio Manager considers it to be in the best interests of that Investor having regard to the availability of BPR for the Investor.
4.8 In the event of a gradual realisation of Investments prior to termination of the Portfolio
Service pursuant to the provisions of Clause 15.1, the cash proceeds of realised Investments will be returned to Investors (after deduction of any fees payable).
5 Dealing in Investments
5.1 In effecting transactions in relation to the Investments, the Portfolio Manager will act in accordance with the FCA Rules and will ensure that best execution is sought at all times and deals are made on such markets and exchanges (and with such counterparties) as the Portfolio Manager thinks fit.
5.2 It is agreed that (where relevant) all transactions will be effected in accordance with the rules and regulations of the relevant market or exchange and that all such steps or action shall be taken as may be required or permitted by such rules and regulations and/or by good market practice. All transactions in Investments will be subject to the rules and customs of the exchange or market and/or clearing house through which the transactions are executed and to all Applicable Laws provided that:
(a) if there is any conflict between (i) the provisions of this Agreement and (ii) any such rules, customs or Applicable Laws, such rules, customs or Applicable Laws shall prevail; and
(b) the Portfolio Manager may take any action it considers necessary to ensure compliance with any such rules, customs or Applicable Laws.
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5.3 The Investor acknowledges that, as the Portfolio will be invested in a range of unlisted
securities, there is generally no relevant market or exchange and consequent rules and customs and that there will be varying practices for different securities. Transactions in any such securities will be effected on the best commercial terms which can be reasonably
secured.
5.4 Subject to the FCA Rules, transactions for the Portfolio may be aggregated with those of other clients of the Portfolio Manager and those of the Portfolio Manager and its Associates (and/or any of their respective employees). Investments made pursuant to such transactions will be
allocated on a fair and reasonable basis in accordance with the FCA Rules and endeavours will be made to ensure that the aggregation will work to the advantage of each of the Investors (including the Investor), but the Investor acknowledges that the effect of aggregation may work on some occasions to the disadvantage of the Investor.
5.5 Where transactions for the Investor are aggregated with transactions undertaken for other
Investors, the Portfolio Manager shall have absolute discretion as to the number of shares allocated to the Investor in an Investee Company and held as an Investment as part of the
Portfolio Service, provided that Investors shall not have fractions of shares. Minor rounding up or down may be allowed to prevent Investors being deemed to be interested in fractions of shares and the aggregate of fraction entitlements may be held by the Custodian (provided that the Investor is at all times the beneficial owner of the shares held for him).
5.6 The Portfolio Manager will act in good faith in its choice and use of counterparties, but (subject to this obligation) the Portfolio Manager shall have no responsibility for the performance by any counterparty of its obligations in respect of transactions effected under this Agreement.
5.7 It is acknowledged and agreed that, where (a) the Portfolio Manager reasonably considers any such action to be consistent with the general principle of the Portfolio Service (as set out in Clause 4.6) and (b) the proposed action is supported by the Advisory Committee, Investments may be sold, redeemed or otherwise realised at any time (which may include before the end of the Minimum Period required for BPR), notwithstanding the impact this may have on the tax position of the Investors (or any of them).
6 Custody and administration arrangements
6.1 The Portfolio Manager has engaged the Custodian to provide a custody, safe-keeping, nominee and administration service for Investors. The Custodian engages with each Investor
pursuant to its own terms of business from time to time.
6.2 The Portfolio Manager may from time to time during the continuance of this Agreement (by giving written notice to the Investors) appoint any appropriate person as a replacement Custodian to provide custody, safe-keeping, nominee and administration services to the
Investors in accordance with the terms of this Agreement.
6.3 The Custodian will be responsible for the safe keeping of Investments and cash comprised in the Portfolio, including the settlement of transactions, collection of income and the effecting of other administrative actions in relation to the Investments.
6.4 Investments will be registered in the name of the Nominee on behalf of the Investor, and will therefore be beneficially owned by the Investor at all times, but the Custodian has by virtue
of this Agreement the proxy of the Investor to vote on the behalf of the Investor at the direction of the Portfolio Manager (or to refrain from voting if the Portfolio Manager so determines) and to instruct the disposal of the Investments.
6.5 The Nominee will hold title documents or other documents evidencing title to the Investments.
6.6 Investments or title documents may not be lent to a third party and borrowing may not be undertaken against the security of the Investments or such the documents.
6.7 An Investment may be realised in order to discharge an obligation of the Investor under this Agreement, (including without limitation, in relation to payment of fees, costs and expenses).
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6.8 The Custodian will arrange for the Portfolio Manager to receive details of any meetings of
shareholders in Investee Companies and any other important information issued to shareholders in Investee Companies. The Portfolio Manager may apply to the Nominee for a proxy directing how any voting rights are to be exercised by the Nominee in respect of an
Investment.
6.9 The Custodian will hold cash subscribed by the Investor in accordance with the Client Money Rules of the FCA. Such cash balance will be deposited with an authorised credit institution in the name of the Custodian. The Custodian may debit or credit the account of the Investor
with all sums payable by or to the Investor (including dividends receivable in cash and fees and other amounts payable by the Investor).
7 No advice from the Portfolio Manager
7.1 The Investor acknowledges and agrees that the Portfolio Manager does not provide any investment or tax advice to the Investor. The Portfolio Manager recommends that the Investor seeks advice from his financial adviser (or consults another financial adviser who is
appropriately qualified and authorised to give investment advice). If the Portfolio Manager provides the Investor with information on particular investments, markets (such as market trends), or the performance of selected companies from time to time, such information
should not be viewed as a personal recommendation or advice and is provided strictly for information only.
7.2 The Investor acknowledges and agrees that the Portfolio Manager has no responsibility for monitoring any ongoing service which may be provided by his financial adviser.
7.3 The Investor acknowledges and agrees that (other than in respect of the obligations of the Portfolio Manager under this Agreement), the Portfolio Manager is not responsible for providing the Investor with, and the Portfolio Manager has not provided the Investor with, any investment advice, any tax advice or any personal recommendations in respect of his Portfolio, or in relation to his decision to invest. The Portfolio Manager shall not be liable for
any losses which the Investor suffers or incurs as a result of acting (or deciding to act) on the advice or recommendation of any third party (including your financial adviser) in relation
to the Portfolio Service.
7.4 The Investor acknowledges and agrees that it is his responsibility (or the responsibility of his financial adviser) to keep his financial circumstances, objectives and appetite for risk under
review and to assess whether the Portfolio Service remains suitable for his needs (subject to the provisions of Clause 7.3).
7.5 The Portfolio Manager reserves the right not to accept the Application Form if the Investor has not received advice from an adviser who is suitably qualified and authorised.
7.6 If the relationship between the Investor and his financial adviser ceases to exist for any reason, the Portfolio Manager strongly recommends that the Investor appoints a new financial adviser in order to ensure that the Portfolio Service remains suitable for his needs (subject to the provisions of Clause 7.3).
7.7 If the Investor chooses to cancel the ongoing service from his financial adviser, the Investor acknowledges and agrees that the Portfolio Manager reserves the right to charge the Investor
an additional fee to reflect the additional cost to the Portfolio Manager in providing the Portfolio Service to the Investor.
8 Reports and information
8.1 The Investor will be sent (by the Custodian) a report every six months, or (if requested) every three months in compliance with the FCA Rules. Reporting will ordinarily be completed
as at the 31 December and 30 June each year.
8.2 Details of dividends which are received in respect of the Investments will be provided in respect of each tax year ending 5 April and appropriate statements sent to the Investor.
8.3 The Portfolio Manager shall supply (or arrange for the Custodian to supply) such further information (which is in the possession of, or under the control of the Portfolio Manager and/or
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Custodian) as the Investor may reasonably request as soon as reasonably practicable after
receipt of such request.
8.4 Any statements, reports or information provided to the Investor will state the basis of any valuations of Investments which have been made.
9 Fees and expenses
9.1 The Portfolio Manager and the Custodian will receive fees for their respective services, and reimbursements of costs and expenses, as set out in Section 3 of the Information Memorandum.
9.2 Fees payable to the Custodian may be deducted by the Custodian at source, upon presentation of an invoice to the Portfolio Manager.
9.3 When an Investment is realised, the Portfolio Manager may direct the Custodian to pay or withhold such amount of the proceeds as is appropriate to meet all performance fees payable to the Portfolio Manager (or any other fees payable to the Portfolio Manager and outstanding).
9.4 If Section 5 of the Application Form has been completed, the Investor authorises the Portfolio Manager to facilitate the payment (on behalf of the Investor) of initial and/or ongoing adviser charges to the financial adviser of the Investor (as indicated in that Section 5).
9.5 An Investment may be realised in order to discharge an obligation of the Investor under the Agreement (for example in relation to payment of fees, costs and expenses)
9.6 The Investor acknowledges and agrees that:
(a) the Portfolio Manager will not be required to account to Investors for any arrangement, monitoring or other fees which the Portfolio Manager (and/or any Associate) receives from Investee Companies (including, without limitation, fees in respect of any person acting as a director or other officer of any such Investee Company); and
(b) the Portfolio Manager and/or the Investee Companies may engage advisers and
consultants in connection with Investments in Investee Companies and any realisations of Investments and that any such fees or incentive payments may also be deducted from disposal proceeds.
9.7 The Portfolio Manager may instruct the Custodian to retain from any dividend or other payments due to the Investor from the Portfolio, a sum equal to any amount or amounts due and payable to the Portfolio Manager (or any other third party) in respect of any fees, costs and expenses (including, without limitation performance fees) in accordance with the terms of this Agreement.
10 Management and administration obligations
10.1 The Portfolio Manager shall devote such time and attention and have all necessary competent personnel and equipment as may be required to enable them to provide their respective
services in a proper and efficient manner and in compliance with the FCA Rules.
10.2 Except as disclosed in the Information Memorandum and as otherwise provided in this Agreement (for example on early termination), the Portfolio Manager shall not take any action the direct result of which would prejudice the tax position of the Investor insofar as
the Portfolio Manager has been notified in writing by the Investor or his financial adviser of the relevant circumstances (but the Portfolio Manager is not obliged to make enquiries as to those circumstances), and in particular which would prejudice obtaining tax benefits for the Investments. The Investor acknowledges and agrees that circumstances may arise whereby it is more efficient to lose the tax relief in order to realise the Investment in a company, including (but not limited to) circumstances where the gain exceeds the tax benefits.
10.3 The Portfolio Manager shall have discretion to instruct the Custodian to instruct its Nominee to exercise the voting and other rights attaching to the Investments, provided that the voting and other rights exercisable by the Portfolio Manager and the Nominee shall not exceed fifty per cent (50%) of the aggregate rights relating to any Investment or otherwise control a company in which Investments are made.
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10.4 The Investor acknowledges that the relationship between the Custodian and the Investor is
created by, and subject to, the provisions of the Custodian Agreement (the terms and conditions of which are set out in Section 6 of the Information Memorandum).
11 Obligations of the Investor
11.1 The investment by the Investor in the Portfolio Service is made on the basis of the declarations made by the Investor in Section 6 of his Application Form.
11.2 The Portfolio established by this Agreement (and its investment in accordance with the terms of the Portfolio Service) is set up on the basis of the declaration made by the Investor in his Application Form.
11.3 The Investor agrees immediately to inform the Portfolio Manager in writing of any change of tax status, any change in the information, statements or declarations provided in the Application Form or any other material change in circumstances.
11.4 The Investor agrees to provide the Portfolio Manager with any information which the Portfolio
Manager reasonably requests for the purposes of managing his Portfolio Service pursuant to the terms of this Agreement.
12 Delegation and assignment
12.1 The Portfolio Manager may employ agents and consultants (including Associates) to perform any administrative or ancillary services to assist the Portfolio Manager in performing its services, in which case it will act in good faith and with due diligence in the selection, use and monitoring of such agents and consultants. Any such employment of agents shall not affect the liability of the Portfolio Manager under the terms of this Agreement.
12.2 The Portfolio Manager has appointed The Share Centre to act as Custodian on behalf of the Investor. By signing the declaration in Section 6 of the Application Form, the Investor enters into, and agrees to be bound by, the terms and conditions of the Custodian Agreement.
12.3 The Portfolio Manager may assign its rights under this Agreement to any appropriately
authorised and regulated person, such assignment being effective upon written notice to the Investor. The Agreement is personal to the Investor and the Investor nay not assign it.
13 Material interests and conflicts of interest
13.1 The Investor acknowledges and agrees that the Portfolio Manager (and/or its Associates) may:
(a) provide similar services or any other services whatsoever to any other client or
potential client;
(b) manage and/or provide services to any Investee Companies; and/or
(c) have direct or indirect interests in any Investee Companies.
13.2 The Portfolio Manager (and/or its Associates) may be paid fees for the services referred to in
Clauses 13.1(a) and 13.1(b) (including by Investee Companies) and receive income or other amounts arising out of the interests referred to in Clause 13.1(c).
13.3 The Portfolio Manager and its Associates shall not in any circumstances be required to account to the Investor for any of the fees, charges, income, profit or other amounts referred to in Clause 13.2.
13.4 The Portfolio Manager will (so far as it deems it practicable) use all reasonable endeavours to ensure fair treatment as between the Investor and other clients in compliance with the FCA Rules.
13.5 The Portfolio Manager has a conflicts of interest policy in place (pursuant to the FCA Rules),
which sets out how the Portfolio Manager identifies and manages conflicts of interest. A summary of the Conflicts Policy is available at www.bamboocapital.co.uk. The Investor hereby confirms that he has read and agrees with the Conflicts Policy.
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13.6 The Investor acknowledges and agrees that:
(a) certain directors and employees of the Portfolio Manager may be investors through the
Portfolio Service;
(b) the Portfolio Manager, and/or its directors, officers, employees, consultants, expert advisers and clients, may co-invest with the Portfolio Service on the same terms and conditions without prior reference to the Investor or without obtaining the consent of
the Investor;
(c) other portfolios or funds or entities managed or advised by the Portfolio Manager may invest in or otherwise transact with an Investee Company from time to time; and
(d) the Portfolio Manager and/or its directors, officers, employees, consultants, expert advisers and clients may already have invested in or otherwise transacted with an Investee Company in which an Investment is made through the Portfolio Service, or in an investment which is connected with an Investment or transaction made through
the Portfolio Service.
14 Liability of the Portfolio Manager and the Advisory Committee
14.1 The Portfolio Manager will at all times act in good faith and with due diligence. Nothing in this Clause 14 shall exclude any duty or liability owed to the Investor by the Portfolio Manager
under the FCA Rules.
14.2 The Portfolio Manager shall not be (and no member of the Advisory Committee shall be) liable for any loss to the Investor arising from any investment decision made or advised in accordance with the Investment Objectives at the relevant time (or for other action in accordance with this Agreement), except to the extent that such loss is directly due to the
negligence or willful default or fraud of the Portfolio Manager and/or any of its Associates (or any of their respective employees).
14.3 The Portfolio Manager shall not be liable for any defaults of any counterparty, agent, banker, nominee or other person or entity which holds money, investments or documents of title,
other than where such party which is its Associate and other than provided for in this Agreement.
14.4 In the event of any failure, interruption or delay in the performance by the Portfolio Manager of its obligations resulting from acts, events or circumstances not reasonably within their control (including, but not limited to, war, riot, civil commotion, terrorism (or threat thereof),
acts or regulations of any governmental or supranational bodies or authorities and breakdown, failure or malfunction of any telecommunications or computer service or systems), the Portfolio Manager shall not be liable or have any responsibility of any kind for any loss or damage incurred or suffered by the Investor as a result of any such act, event or circumstance.
14.5 As the Investor is classified as a retail client, the Portfolio Manager is required to (a) carry out an assessment of suitability of the Portfolio Service as an investment (to the extent that the Investor does not have a financial adviser details of whom have been provided in Section 4 of the Application Form) for the Investor and (b) assure itself that the Portfolio Service is
in general terms appropriate for the Investor.
14.6 The Portfolio Manager does not give any representation or warranty as to the performance of the Portfolio Service. The Investor acknowledges that investments of the type envisaged by the Portfolio Service are high risk investments, being Non-readily realisable investments. There is a restricted market for such investments and it may therefore be difficult to sell the Investments or to obtain reliable information about their value. The Investor undertakes that
he has himself carefully considered the suitability of investment in the type of companies envisaged by the Portfolio Service and has noted the Risk Factors set out in Section 4 of the Information Memorandum.
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15 Termination, withdrawal and return of investments
15.1 This Agreement shall automatically terminate upon written notice being served by the
Portfolio Manager to the Investor informing the Investor that all of his Investments have been realised and/or all realisation proceeds due to be paid to the Investor have been settled.
15.2 As stated in the Information Memorandum and the Application Form, the Portfolio Service cannot be terminated for a period of three years from the date on which the Portfolio Service
commences in accordance with the provisions of Clause 4.1.
15.3 Subject to the provisions of Clause 15.2, the Investor may apply in writing to the Portfolio Manager to withdraw all or part of the uninvested cash and/or the proceeds of realisation of Investments in Investee Companies standing to the credit of his account with the Custodian, in which case the Investor should note:
(a) this Agreement shall continue to apply to any remaining uninvested cash or Investments held in the Portfolio;
(b) that he/she will not be entitled to the return of his/her initial fee; and
(c) unless otherwise agreed in writing, the Portfolio Manager is entitled to any accrued and unpaid management, performance or other fees by way of deduction from such uninvested cash and/or proceeds of realisation of Investments in accordance with the
provisions of Clause 15.7 (or otherwise).
15.4 The Portfolio Manager may terminate this Agreement on not less than three months’ written notice from the Portfolio Manager to the Investor of its intention to terminate its role as Portfolio Manager under this Agreement.
15.5 The Portfolio Manager will be entitled to terminate this Agreement immediately on notice to the Investor in writing if:
(a) the Investor has committed a material breach of any provision of this Agreement and,
in the case of a breach capable of remedy, fails to remedy such breach (to the
satisfaction of the Portfolio Manager) within 30 days of receipt of a written notice from the Portfolio Manager giving full particulars of the breach and requiring such breach to be remedied; or
(b) the Investor is the subject of a bankruptcy petition or order, or proposes an individual voluntary arrangement.
15.6 Subject to Clause 15.7, on the realisation of any Investments prior to termination of the Portfolio Service or this Agreement pursuant to the provisions of this Clause 15, the proceeds of such realisation (whether in cash or securities) will be returned within a reasonable period
to the Investor by the Custodian.
15.7 Any return of cash and/or proceeds of realisation of Investments pursuant to the provisions of Clause 15.6 shall be made after the deduction or withholding from such cash and/or proceeds of realisation of Investments of any relevant fees, costs or expenses (including,
without limitation, any performance fees payable pursuant to the terms of the Information
Memorandum and Clause 9).
15.8 In the event of the death of the Investor:
(a) from the date on which the Portfolio Manager is notified of the death, the Portfolio of the Investor will be suspended (save for completing any Investment in Investee Companies that are in progress at such time) and the discretionary portfolio management mandate of the Investor shall stop;
(b) during the period of suspension referred to in Clause 15.8(a), the Portfolio Manager shall be entitled to continue to deduct fees in accordance with the provisions of Clause 9 and otherwise as described in the Information Memorandum, for administering and making arrangements to deal with the Portfolio of the Investor following his death;
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(c) no instructions will be accepted in relation to the withdrawal or transfer of assets from
the Portfolio of the Investor until the Portfolio Manager has received evidence to its satisfaction of the transfer of title to the personal representatives of the Investor, at which point the personal representatives shall be entitled to instruct the Portfolio
Manager to terminate this Agreement on thirty days’ written notice, such termination to be in accordance with the terms of this of this Agreement; and
(d) the personal representatives of the Investor will be bound by this Agreement until it is terminated in accordance with Clause 15.8.
16 Consequences of termination
16.1 On termination of this Agreement pursuant to the provisions of Clause 15, the Portfolio Manager will use reasonable endeavours to complete all investments in proposed Investee
Companies that are in progress at the time of such termination expeditiously on the basis set out in this Agreement.
16.2 On termination of this Agreement pursuant to the provisions of Clause 15, all Investments in the Portfolio of the Investor will be (at the discretion of the Portfolio Manager):
(a) realised in an orderly fashion, recognising that an Investment may be a Non-readily realisable investment (with the net cash proceeds of the allocation of the Investor (after fees and expenses transferred to the Investor));
(b) transferred into the name of the Investor (or to such other person as the Investor may reasonably request); or
(c) dealt with by way of a combination of realisation and transfer, but in all cases, subject to the withholding or deduction by the Portfolio Manager of all fees payable and costs
and expenses deductible pursuant to the terms of Clause 9 (and otherwise described in the Information Memorandum).
16.3 Termination will not affect accrued rights, existing commitments or any contractual provision intended to survive termination and will be without penalty or other additional payments,
save that the Investor will pay fees, expenses and costs properly incurred by the Portfolio Manager up to and including the date of termination and payable under the terms of this Agreement.
16.4 On termination, the Portfolio Manager may instruct the Custodian to retain and/or realise and/or transfer to the Portfolio Manager such Investments as may be required to settle
transactions already initiated and to discharge the outstanding liabilities of the Investor, including fees, costs and expenses payable under Clause 9 of this Agreement (and otherwise described in the Information Memorandum).
17 Confidential information
17.1 Neither the Portfolio Manager nor the Investor shall disclose to third parties information the disclosure of which by it would be or might be a breach of duty or confidence to any other person.
17.2 The Portfolio Manager will at all times keep confidential all information acquired in relation to the Portfolio Service, except for information which:
(a) in the public domain;
(b) is required to be disclosed by Applicable Laws;
(c) is required to be disclosed by or to regulatory agencies;
(d) is given to the respective professional advisers of the Portfolio Manager or Investor (where the provision of such information reasonably necessary for the performance of their professional services); and/or
(e) is required by the Custodian and Nominee for the proper performance of this Agreement and/or the Portfolio Service; and/or
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(f) is authorised to be disclosed by the Investor.
18 Complaints
18.1 The Portfolio Manager has established procedures in accordance with the FCA Rules for consideration of complaints. Details of these procedures are available from the Portfolio Manager on request. If an Investor has a complaint, he should contact the Portfolio Manager in the first instance. If the Portfolio Manager cannot resolve the complaint to the satisfaction
of the Investor, the Investor may be entitled to refer the complaint to the Financial Ombudsman Service (“FOS”). The FOS is an independent service set up to resolve disputes between customers and businesses providing financial services. The FOS can be contacted at: Exchange Tower, London E14 9SR and further information can be found at www.financial-ombudsman.org.uk.
18.2 A referral of a complaint to the Portfolio Manager or the FOS in accordance with the provisions of clause 18.1, is without prejudice to the rights of the Investor to bring court proceedings in respect of any breach of this Agreement.
19 Compensation
19.1 The Portfolio Manager participates in the Financial Service Compensation Scheme, established under the FSMA, which provides compensation to eligible Investors in the event of a firm being unable to meet its customer liabilities. Payments under the protected investment business scheme are limited to a maximum of £85,000.
19.2 Further information is available from the Financial Services Compensation Scheme at 10th Floor, Beaufort House, 15 St Botolph Street, London EC3A 7QU.
20 Notices, instructions and communications
20.1 Notices of instructions to the Portfolio Manager should be in writing and signed by the Investor, quoting an investment reference number except as otherwise specifically indicated.
20.2 The Portfolio Manager may rely and act upon any instruction or communication which
purports to have been given by any person(s) authorised to give instructions by the Investor in the Application Form (or subsequently notified by the Investor from time to time) and, unless the Portfolio Manager receives written notice to the contrary, whether or not the authority of any such person(s) shall have been terminated.
20.3 Communication to the Investor shall be to the address or in the manner specified in the Application Form (or as otherwise notified by the Investor to the Portfolio Manager in writing from time to time).
20.4 Any written notices or communication to be given by the Portfolio Manager or the Investor
pursuant to the terms of this Agreement may be given by email, fax or by any other means which the Portfolio Manager may, in its absolute discretion, determine from time to time.
21 Unsolicited real time financial promotion
21.1 The Portfolio Manager may communicate an unsolicited real time Financial Promotion (namely
interactive communications (such as a telephone call) promoting investments) to the Investor from time to time.
22 Amendments
22.1 The Portfolio Manager may amend the terms in this Agreement by giving the Investor not less than 30 days’ written notice for any of the following reasons:
(a) to make them fairer or more readily understandable, or to correct a mistake (provided such correction does not adversely affect the Investor);
(b) (to reflect a change in technology, or to implement an improvement or change in the way the Portfolio Manager provides the Portfolio Service;
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(c) to make proportionate and reasonable changes to reflect a change in market conditions
or the overall cost of providing the Portfolio Service;
(d) to respond proportionality to changes in applicable rules or the decisions of any relevant regulatory authority;
(e) to reflect new industry guidance and codes of practice; and/or
(f) to reflect other legitimate cost increases (or reductions associated with providing the Portfolio Service).
22.2 The Portfolio Manager may amend these terms with immediate effect if:
(a) such amendment is considered necessary by the Portfolio Manager to comply with the FCA Rules; or
(b) such amendments are considered by the Portfolio Manager (acting reasonably) to be
consistent with the Investment Objectives (and such view is supported by the Advisory
Committee).
22.3 Any amendments made in accordance with the provisions of Clause 22.2 will become effective as soon as the Investor is notified in writing.
22.4 The Portfolio Manager and the Investor may amend this Agreement at any other time if such amendments are agreed and in writing.
23 Data protection
23.1 All data which the Investor provides to the Portfolio Manager is held by the Portfolio Manager subject to the Data Protection Act 1998. The Investor agrees that the Portfolio Manager may pass personal data to the Custodian insofar as is necessary for it to manage the Portfolio Service and to the FCA and any regulatory, governmental judicial or law enforcement body if
requested to do so. At account opening (or as may otherwise be determined by us), enquiries may be made at a credit reference agency to assist us verify your identity. This will involve
checking the details supplied by the Investor with any credit reference agency database. A record of any such search will be held by the relevant credit reference agency and may be shared with other businesses. We may also make a search of the directors of limited companies.
24 Entire agreement
24.1 This Agreement, together with the Application Form and the Information Memorandum, comprises the entire agreement of the Portfolio Manager with the Investor in relation to the
provision of services under this Agreement and supersedes all earlier meetings, any correspondence, or discussions that may have taken place preceding the signing of the Application Form. The Investor agrees that he has made his decision to invest in the Portfolio Service based on the information contained in the Information Memorandum.
25 Severability
25.1 If any term, condition or provision of this Agreement shall be held to be invalid, unlawful or unenforceable to any extent, such term, condition or provision shall not affect the validity, legality or enforceability of the remainder of this Agreement.
26 Rights of third parties
26.1 A person who is not a party to this Agreement has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Agreement (save that the Custodian may
enforce those provisions expressly set out in this Agreement which relate to the Custodian).
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27 Governing law
27.1 This Agreement and all matters relating thereto shall be governed by, and construed in
accordance with, English law and the parties irrecoverably submit to the exclusive jurisdiction of the English Courts.
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SECTION 6
CUSTODIAN AGREEMENT
The Custodian Agreement sets out the agreement between the Custodian and the Investor in relation to the Portfolio.
Custodian’s terms of business (https://www.share.com/Global/Forms/partners/eis/eis-cust-tobs.pdf)
Important information relating to your account(s)
When you open your account you will be signing up to a legal Agreement between you and The Share Centre. For your own benefit and protection you should read these terms carefully before you proceed. If you do not understand anything, please contact us on 01296 41 41 41.
You accept that the prices and values of investments, and products related to them, together with
the income they produce, can go down as well as up and that you may get back less than your initial investment. In addition, the levels and bases of taxation may change, both generally and in relation to specific products and investments. Consequently, The Share Centre cannot accept responsibility for any movements in the value of your investments. Past performance is no
indication of future performance.
Section 1
Terms of Business - applicable to all accounts
1. General information
1.1 Your account is being provided to you by The Share Centre Limited (“TSC”), a company incorporated in England and Wales under company number 2461949. If you want to contact TSC you can write to us at PO Box 2000, Aylesbury, Bucks HP21 8ZB, email [email protected] or phone 01296 414141.
1.2 Where you see the words “you” or “your” in these Terms of Business, it means you as the
individual, or if opening a joint Account, all individuals named on the joint Account. If you are applying as an official of a company or a trust, then it is referring to the company or trust, and not you personally.
1.3 TSC is authorised and regulated by the Financial Conduct Authority (“FCA”) to provide share
dealing and administration services. The FCA reference number for TSC is 146768 and you can check this information on the FCA’s website www.fca.org.uk. The FCA’s address is 25 The North Colonnade, Canary Wharf, London E14 5HS.
1.4 You will be treated as a ‘retail client’ under the rules of the FCA, which means that you are entitled to the full extent of applicable regulatory protections. You have the right to request
to be classed as either a ‘professional client’ or ‘eligible counterparty’: this request must be made in writing and re-classification will only apply when TSC confirm this to you in writing. Please note that re-classification is dependent on you meeting certain criteria and that it will result in limitations to the level of applicable regulatory protections, including the loss of
access to the Financial Ombudsman Service and Financial Services Compensation Scheme (which are explained in paragraph 11). Details of different client classifications can be
obtained from TSC’s Compliance team.
1.5 This Agreement is made up of:
these Terms of Business;
TSC literature provided to you on the website and/or by post, which describes your Account and how it works in more detail; and
the Account tariff.
Unless we advise you otherwise, this Agreement contains all the terms and conditions that will apply to your Account.
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1.6 Before your application can be considered you must agree to abide by the terms of this
Agreement. However, a legally binding agreement will only arise once TSC notifies you that it has accepted your application. If TSC decides not to accept your application, there will be no Agreement: if you have provided any documentation in support of your application this
will be returned to you at the address shown on your application form.
1.7 TSC can amend the Agreement from time to time only if it has a valid reason for doing so. A valid reason means one of the following:
a change in law, regulation, industry guidance or codes of practice;
new market practices; or
economic reasons, including a variation in taxation rates or costs incurred in providing your Account (in which case TSC will respond proportionately).
1.8 If TSC changes this Agreement for a valid reason (as detailed in 1.7 above), no change will affect any rights or obligations of yours arising before the date the change becomes effective.
TSC will give you at least 30 days advance notice, either by post or email (if applicable to you), of any changes being made. Where a change results in an increase in charges to you, you can terminate this Agreement within 30 days after the change becomes effective, in which case no additional charges over and above those that were applicable before the change occurred will be paid by you.
1.9 This Agreement is in English and all future communications with you will also be in English. The Agreement is governed by English law and in the event of a serious dispute, will be subject to the exclusive jurisdiction of the English courts.
1.10 Any transactions undertaken for you in stocks and shares will be subject, where applicable,
to:
the rules of:
the London Stock Exchange (“LSE”);
any other market as TSC may decide;
CREST (the UK electronic system used for transferring shares between sellers and buyers);
Cofunds Nominees Limited (“Cofunds”, which is used to safeguard holdings in some collective investment funds such as unit trusts); and
the FCA; and
all other applicable laws, rules and regulations.
TSC will act as your agent in any such transactions. Where there is a conflict between this Agreement and any such laws and regulations, the latter will prevail.
You must comply with the City Code on Takeovers and Mergers and the FCA’s Disclosure
and Transparency Rules regarding the notification of major shareholdings, which may be relevant if you are dealing in large quantities of shares. Further details can be obtained from TSC’s Compliance team.
1.11 There may be times when a conflict of interest develops between you and TSC or between
you and another TSC customer. TSC has taken all reasonable steps to identify such conflicts of interest and has a Conflict of Interest Policy in place, designed to prevent conflicts of interest from adversely affecting the interests of its customers. A summary version of this Policy is set out in Schedule 1 below.
1.12 Unless you have sought specific investment advice from TSC’s Advice team (see Section 5
below for the Advice Terms of Business) all transactions are carried out on your own initiative (i.e. ‘execution only’). TSC is not responsible for advising you on the suitability of the services or transactions provided or offered by TSC. You will therefore not benefit from the protection
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of the FCA’s rules relating to suitability which would require TSC to ensure that a product or
service is suitable for you when taking into account your knowledge and experience in the relevant investment field, your financial situation and your investment objectives.
1.13 If you want to purchase a ‘complex’ investment (e.g. a warrant, covered warrant or ‘securitised derivative’) on an execution only basis, you may be required to successfully complete an appropriateness test, which will indicate to TSC that you are sufficiently aware of the risks involved in undertaking such a transaction. If you fail the appropriateness test, TSC reserves the right not to accept your instruction to deal.
You will also need to successfully complete an appropriateness test before we can supply you with a ‘personalised communication’, which is a communication specific to you and your circumstances and which invites you to undertake a specific transaction.
1.14 TSC does not provide advice on the legal implications of accepting this Agreement. Unless you have been specifically told otherwise by the Advice team, TSC does not provide advice on taxation.
2. Cancellation Rights
2.1 You have the right to cancel this Agreement for a period of up to 14 days (or 30 days if this Agreement relates to a pension) from the day on which TSC accepts your application, i.e. the date of the welcome letter or email that will be sent to you, as detailed in 1.6 above.
2.2 In order to cancel the Agreement you must send your written instructions to cancel to TSC (or its nominated agent) before the end of the 14th day (or 30th day, for pensions) cancellation period.
2.3 If you do decide to cancel, you must still pay for any services that TSC has actually provided
(which may include re-registration and commission charges), based on the published tariff sheet. Additionally, your right to cancel cannot apply to any transaction where the price of the investment concerned can fluctuate within the financial marketplace because such fluctuations in share price are outside of TSC’s control.
To clarify, your right to cancel applies to your Account but not necessarily to the transactions you have undertaken: accordingly, what you get back on cancellation may be less than you originally invested.
3. Customer Information
3.1 You will supply TSC with all information reasonably requested as soon as practical. You confirm that all information will be, to the best of your knowledge and belief, correct when supplied and that you will notify TSC immediately of any changes.
3.2 TSC is registered to use your personal information under the Data Protection Act 1998 (as may be amended). Under the terms of this Act, you are entitled to a copy of any personal information TSC holds on computer and on certain written records, upon payment of the appropriate fee.
3.3 You agree that TSC may hold information about you and your affairs in order to:
verify your identity and financial standing (among other things TSC is likely to consult a credit or mutual reference agency, which may retain a record of the enquiry);
provide you with TSC’s services (which may also necessitate TSC liaising with third parties, such as companies and their registrars, and disclosing some aspects of your personal information in order to verify, or otherwise discuss, your investments in the proper provision of TSC’s services);
keep you up-to-date regarding other services which TSC or firms for whom TSC provides outsourced share dealing and/or administration services considers may be of interest to you. If you would prefer not to receive direct marketing information, please complete the relevant section of the application form or advise TSC on 01296 41 41 41.
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3.4 TSC will treat all personal information about you and your financial affairs as confidential.
TSC may however disclose any such information:
to its authorised agents and firms for whom TSC provides outsourced share dealing and/or administration services;
if required to do so by law or regulation;
if requested by a financial regulator; and/or
where you have given your consent to the disclosure.
The information may also be shared with other financial organisations to protect TSC and its customers, and other financial organisations and their customers, against financial crime.
Further information on safeguarding customer data is contained within TSC’s Privacy Policy available from TSC’s website, www.share.com.
3.5 Due to anti-money laundering regulations (which aim to prevent criminal property being used or disguised as legitimate wealth) you may have to produce satisfactory evidence of your identity, or the identity of any person on whose behalf you are acting, before TSC can do any business with you, and from time to time thereafter. This identification process is
designed to assist in the prevention of crime within the financial services industry and society at large. If you do not provide the information when requested, TSC may be unable to accept any instructions from you or provide you with any other services.
3.6 TSC will only accept applications from residents of certain qualifying countries, details of
which are available from TSC. Where applications are received from such residents, additional identification requirements may apply.
3.7 You confirm that you are not a US person for the purposes of US federal income tax, and that you are not acting for, or on behalf of, a US person. The definition of a US person includes, but is not limited to, US citizen, US resident, US taxpayer or someone who holds
US dual nationality. In the future, should you become a US person, you agree to inform us
immediately and consent to the automatic closure of your Account, or any Account over which you are a trustee or attorney, whether solely or jointly.
4. Charges
4.1 You must pay all applicable fees, commissions and other charges in accordance with TSC’s published tariff sheet. You must also pay all applicable taxes and levies (e.g. Stamp Duty, market levies, overseas financial transaction taxes, currency conversion fees, custodial charges, charges on foreign currency exchanges and administration charges levied by overseas agents) that TSC is required to charge you. All such charges may be deducted from
your Account or from any other account you hold with TSC. Other taxes and costs (e.g. Capital Gains Tax) may also exist that are not collected or deducted by TSC.
5. Your Money and Investments
5.1 Your money will be handled in accordance with the client money rules of the FCA and unless
otherwise agreed all money received or paid from or to you must be in British Pounds Sterling.
5.2 All payments to your Account must be drawn on a United Kingdom (“UK”) bank account. Please note that if your account is in your own name it must be drawn on your own personal bank account, for a Company account payments must be drawn from the Company’s bank account and for an Investment Club account payments must be drawn from the Investment Club’s bank account.
You may credit money to your Account by using an acceptable form of debit card, providing the sum to be credited does not exceed such limit as TSC may advise. Alternatively you can credit monies to your account using a same day banking service.
5.3 TSC, at its absolute discretion, may require payments received, either individually or
collectively, in excess of £25,000 to be subject to clearance, before dealing instructions are
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accepted.
5.4 TSC has the right to return money, whether received by cheque, bank transfer or debit card,
to ‘source’ (i.e. from where it came). All money returned will be done so at your own risk and will be subject to the normal timings of the banking clearance system.
5.5 TSC has the right to delay the return of any money received from you until 10 business days after the date of clearance for credit control purposes.
5.6 Unless otherwise indicated, TSC will not accept or make third party payments on your behalf. All receipts and withdrawals of money and investments must be received from, or paid to, an account in your own name or, in certain circumstances such as your death or incapacity, your legal representatives. Where requested and agreed, money will only be transferred overseas to certain qualifying countries, details of which are available from TSC.
5.7 The cash balance held on your behalf, and as shown in your Account, will be deposited in the name of TSC under customer trust status, i.e. separate from TSC’s own money, with an
authorised banking institution, together with cash balances belonging to other customers of TSC. These deposits may be held within instant access accounts with other authorised
banking institutions. TSC may debit or credit your Account for all sums payable by or to you (including dividends you may receive in cash, fees and other amounts payable by you).
5.8 Interest will be payable quarterly on credit balances on money in your Account at the rates published from time to time by TSC. Where you make a payment to TSC to be credited to
your Account, no interest will start to be calculated on this sum until the payment has cleared.
5.9 In the event that TSC does not hear from you for a period of 6 years, has made reasonable attempts to contact you, and such attempts have been unsuccessful, any money held in your Account may be released for the benefit of TSC’s chosen charity. Should you subsequently contact TSC and make a valid claim, TSC will reimburse the money to you. However, interest
will not be due to you from the date of release of the money to the charity.
5.10 Investments held on your behalf are pooled with the investments of other clients. All investments in your Account will be held by Share Nominees Limited, TSC’s ‘pooled’ nominee
company. This means that there are no separate certificates, documents evidencing legal
ownership or external electronic records of your individual investment holdings. The holdings will be registered in the name of Share Nominees Limited or in the name of Cofunds who act as custodian for Share Nominees Limited for certain unit trusts and open-ended investment companies (“OEICs”). As a result your holding may not be individually identifiable on the relevant company register. Share Nominees Limited is a bare trust and holds investments for you as the beneficial owner, together with investments belonging to other customers of TSC, ensuring they are kept separate from the resources of TSC itself. If we identify a
shortfall in the investment pool relative to the total sum of our clients’ holdings in that investment, we will segregate an equivalent amount of our own money as client money to cover the cost of rectifying that shortfall until it is corrected. This will not affect the record TSC maintains which shows how much stock is held on your behalf.
5.11 The Nominee and Cofunds hold the investments on trust, such that when customers buy or dispose entirely of an investment in accordance with this Agreement, their interest in relation to that investment within the trust is created or extinguished respectively.
5.12 TSC accepts responsibility for holdings in the name of the Nominee and for acts and omissions of the Nominee, but it does not accept responsibility for holdings in the name of
Cofunds or the acts or omissions of Cofunds.
5.13 TSC may deliver or accept delivery of investments either in certificate form or via Crest on behalf of the Nominee.
5.14 In the event that an investment ceases to be settled through CREST, TSC will use reasonable endeavours to continue to offer a dealing, settlement and pricing service in that investment insofar as is reasonably practicable in the circumstances. TSC reserves the right to charge any additional costs associated with such dealing and/or settlement to you.
5.15 Overseas investments may be held on behalf of TSC by an overseas custodian, its sub-
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custodian or an investment clearing system. TSC and the Nominee do not accept
responsibility for any losses arising from the default of such an appointed custodian or clearing system. It should be noted that there may be different settlement, legal and regulatory requirements in overseas jurisdictions from those applying in the UK and different
practices for the separate identification of investments.
Overseas investments held by the Nominee may be in the form of CREST Depositary Interests (“CDIs”) or American Depositary Receipts (“ADRs”). CDIs and ADRs generally cannot be registered into certificates. CDIs may be liable for withholding tax from the country of origin
of the underlying investment. TSC is not obliged to reclaim any foreign withholding tax deducted. If you are unsure about the tax implications of dealing in overseas investments, you should seek independent tax advice.
5.16 On some occasions, money relating to overseas investments not held by the Nominee may be deposited in a client bank account outside the UK. Money held in its country of origin will
be held with an approved bank or depositary: however there may be times, because of the applicable law or market practice, when it is not possible to hold your money in a client bank
account with an approved bank or depositary. In some cases, the bank or depositary with which your money may be held outside the UK may not have accepted that it has no right of set off or counterclaim against your money in respect of any sum owed by TSC on any other account held by TSC at the bank. Additionally, your money may be passed to another person,
such as an exchange, clearing house or an intermediate broker, for the purposes of a transaction on your behalf through or with that person. It is to be noted that for banks, depositories and persons located outside the UK, the legal and regulatory regime applying will be different from that of the UK: in the event of failure, your money may be treated in a different manner from that which would apply if the money was held in the UK.
5.17 Subject to paragraph 5.12 above, in the event of there being a shortfall in the total quantity of money or an investment held in a pooled nominee or client money bank account, compared with the quantity or balance which should be held for customers, or in the event of an authorised banking institution, the Nominee, Cofunds, or any other third party custodian, bank or counterparty used by TSC defaulting (e.g. if they become insolvent), customers may have to bear that shortfall on a pro-rata basis.
5.18 Dividends from investments will usually only be received as cash.
5.19 Unless you are otherwise informed, TSC will provide you a statement either in paper or on our website via account sign-in of your investments at least once in any 12 month period,
which will be based on deal date information (i.e. the effect of purchases or sales which are unsettled at the statement date will be reflected).
5.20 You shall not charge or pledge the investments held under this Agreement (i.e. use them as security for a loan) or dispose of all or part of them otherwise than in accordance with this
Agreement. Your investments and cash held by TSC or under TSC’s control shall at all times be subject to a general lien and right of set off against all amounts owing to TSC from time to time. In other words, any sums due to TSC in respect of commissions, costs, fees, expenses or other amounts payable under this Agreement (plus any applicable value added tax) may be deducted or withdrawn (upon at least 3 business days prior notice) from any of your investments or cash held by TSC and TSC may have recourse against and sell, realise or dispose of any such assets and apply the proceeds in or towards the discharge of such
sums. Any such sale, realisation or disposal shall be conducted in the manner and at the price TSC believes reasonably necessary in the circumstances (without being responsible for any loss or reduction in price), subject to compliance with the FCA’s rules in connection with any such sale, realisation or disposal. The proceeds of any sale or disposal of such assets (net of costs) will be applied in or towards the discharge of your liabilities and TSC will account to you for any balance. In the event that such proceeds of sale are insufficient to cover the whole of your liabilities, you remain liable for the balance. A confirmation in writing
from TSC that any power of sale or other disposal has arisen and is exercisable shall be conclusive evidence of the fact in favour of a purchaser or transferee of the whole or any part of any such assets.
6. Dealing
6.1 TSC may carry out transactions on your behalf in investments to which it provides access
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unless you are a permanent resident of a country outside the UK, in which case restrictions
may apply. TSC may refuse to accept any dealing instructions from individuals who are resident or domiciled in any overseas country, if acceptance of a dealing instruction would require TSC to comply with any governmental or regulatory procedures or other formalities
of that country.
6.2 TSC will not deal in investments which have been suspended from dealing. TSC may also decide not to accept your dealing instructions or other instructions relating to your Account in certain circumstances, for example where TSC is concerned about the lawfulness of the
transaction or instruction.
6.3 All instructions to TSC to deal in investments must be on either a ‘limit price’ basis (where you set the maximum or minimum price at which you are prepared to deal) or ‘best price’ basis (where TSC will take all reasonable steps to obtain the best possible price for you). TSC will seek to obtain the best possible result for you, in line with your instructions, in
accordance with its Order Execution Policy, which you can find in Schedule 2 below. By placing an order to deal, you acknowledge that you have read, and agree to be bound by,
the Order Execution Policy.
6.4 Where you instruct TSC on a best price basis, there may be occasions where the price
obtained differs from the price indicated to you at the time your instruction to deal was placed, for example where the number of shares or units to be dealt is larger than the investment’s normal market dealing size.
6.5 Limit prices may be placed on dealing instructions for up to 365 calendar days. Limit prices may be cancelled and re-submitted at your discretion provided that the dealing instruction
has not been executed. Where any limit order cannot be immediately executed, you agree that TSC may publish details of your unexecuted limit orders. Please note that TSC does not accept limit orders in non-UK traded securities.
6.6 TSC cannot guarantee that limit price dealing instructions will be executed even if the limit
price is reached. This could be due to prevailing market conditions, for example a ‘fast market’, where the market is so volatile that prices quoted in the stock market are only
indicative rather than guaranteed, other customers’ orders having priority over your order due to them having placed their order before you placed yours or to other factors beyond TSC’s control.
6.7 Limit price dealing instructions and price alerts are monitored each working day during London Stock Exchange trading hours, generally from 8.00am until 4.30pm.
6.8 Limit price dealing instructions and automated price alerts (only available to Internet users) that reach the end of their expiry date are deleted after close of business on the expiry date:
it is your responsibility to renew them if you want to.
6.9 In the event of a change in the share capital of an investment, or other corporate action, which could significantly impact on any current limit price dealing instruction, TSC will endeavour to delete that pending dealing instruction. However, TSC is under no obligation
to do so and it remains your responsibility to ensure limit price dealing instructions remain valid and to make any adjustments you consider necessary or desirable to reflect any changes in prevailing market conditions.
6.10 You recognise and accept that certain features (where available) and risks apply to the use of different types of limit price dealing instructions:
stop-loss dealing instructions should initiate when the price falls to or below the specified level;
tracking stop-loss dealing instructions should initiate when the price falls by the specified amount from the monitored peak price;
certain factors may cause the bid-offer spread of an investment to increase, even momentarily, to a wide level, thereby causing a stop-loss dealing instruction to be initiated: wide bid-offer spreads may nevertheless be the most favourable prices
quoted for the investment at that time;
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sale price limit dealing instructions should initiate when the price rises to or above
the specified price level;
purchase price limit dealing instructions should initiate when the price falls to or below the specified price level;
market volatility may result in limit price dealing instructions being initiated, but with the resulting order being executed at a price which is above or below the price you
set.
6.11 When you submit a dealing instruction to TSC, orders are dealt as soon as reasonably practicable in the circumstances. For many investments (predominantly equities), if you submit a best price order via TSC’s Internet dealing facilities and the market is open and a price is available, a price quotation will be displayed on your Internet screen, which will be
valid for a period of 10 seconds, during which time you must confirm your dealing instruction in order to obtain that price. Please note that although the price quotation is held for 10 seconds, the prevailing price within the market could have risen or fallen during this 10
second period, meaning that the price quotation might be withdrawn by the relevant Retail Service Provider. If you do not confirm your dealing instruction, you can obtain a revised price quotation later.
If you specify a limit price on your dealing instruction, and that limit price can be achieved within the market, your dealing instruction will be dealt immediately without the display of any price quotation.
6.12 If you submit a dealing instruction via TSC’s Internet dealing facility outside the usual business hours of the LSE or relevant market, the dealing instruction will be executed as soon as reasonably practicable after 8.00am on the next day that the LSE or relevant market re-opens. You acknowledge that TSC may not necessarily obtain the official opening market price and that price movements may be more volatile when the market first opens. The difference between the buying and selling prices on some securities may also be greater at,
or around, this time. Outside usual business hours it may be advisable for you to enter a limit price dealing instruction.
6.13 All dealing instructions are only dealt automatically if they can be completely satisfied. If a dealing instruction cannot be executed automatically for whatever reason, it will, if possible, be manually executed as soon as reasonably practicable.
6.14 Dealing instructions will not be partially filled.
6.15 TSC may aggregate (i.e. combine) your orders with those of other customers, which may
operate on some occasions to your disadvantage. Further information is contained within TSC’s Order Allocation Policy, which can be found in Schedule 3 below.
6.16 Dealing instructions cannot be altered once they have been accepted and executed by TSC. If you submit an incorrect dealing instruction and TSC decides to accept an instruction to
correct that deal, you agree to be responsible for any costs or losses incurred by TSC which a reasonable person would consider to be the probable result of correcting the previous transaction.
6.17 Dealing instructions to purchase investments will only be executed if there is sufficient money in your Account, or sufficient sale proceeds due, to meet the potential cost of execution
(including all applicable charges). Subject to this, in the event of adverse price fluctuations TSC has the right to reduce the size of a purchase dealing instruction if there are insufficient funds in your Account to meet the potential cost of execution (including all applicable charges).
Dealing instructions to sell investments will only be executed if there are sufficient investments recorded within your Account that can be transferred to the purchaser, which shall not be adversely affected by paragraph 5.13 above.
6.18 If you intend to purchase a unit trust or OEIC you will need to confirm that you have read the relevant simplified prospectus or key investor information document. You will be provided
with access to these important documents during the dealing process or you may request a
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copy from TSC’s Dealing team. When dealing in unit trusts or OEICs administered by
Sharefunds Limited, TSC’s sister company, dealing instructions must normally be received and validated by midday for dealing that day. All other unit trust and OEIC dealing instructions must be received and validated by 10.00am if they are to be dealt that day.
6.19 If you intend to purchase an exchange traded fund (“ETF”), you should read the additional risk warnings, including details of the limited protection available from the UK regulatory system, which are available on TSC’s website. You will also need to confirm that you have read the relevant simplified prospectus or key investor information document. You will be
provided with access to these important documents during the dealing process or you may request a copy from TSC’s Dealing team.
6.20 Where you instruct TSC to deal or otherwise act in relation to your money or investments by mobile phone, internet or other automated access route, provision of your customer reference number, password and part of your own chosen memorable word shall be sufficient
authority for TSC to act upon your instructions. Your password and memorable word must remain your personal secret. You must change your password and memorable word if you
believe anybody else knows them and notify TSC immediately if you discover that they have been lost or compromised. TSC will not be liable for any unauthorised use of a password or memorable word resulting from negligence on your part or loss arising therefrom. TSC may withdraw the password or memorable word where the wrong number is entered more than
once or in other circumstances.
6.21 TSC may retain any commissions received from a third party arising from transactions carried out for you and the amount of such commission and the identity of the third party will be available upon request. In addition, TSC may pay a share of the fees or commissions charged to you with third parties and the amount paid to the third party and its identity will be
available upon request. Such instances can include where a third party has introduced you to TSC.
6.22 Except where otherwise permitted by the FCA’s rules, following a transaction you will be sent a contract note, either in paper or electronic format. Any query in relation to the contract
note should be raised by you within 5 business days of receipt so that any matters arising
can be promptly resolved, otherwise TSC will assume that you have accepted the contents of the contract note. Prior to receiving the contract note, for information about the status of your order you can contact a member of TSC’s Dealing team or view the status online at www.share.com.
6.23 HM Revenue and Customs (“HMRC”) may challenge any purchase or sale prices in less liquid investments for open market valuation purposes (for instance, for assessing capital gains tax liability). When assessing tax liabilities arising from a transaction in less liquid investments, you should seek independent tax advice, and should not necessarily rely upon any transaction price or contract note as evidence of an open market value.
7. Settlement
7.1 Once TSC has executed your dealing instruction, sale proceeds (if a sale) or investments (if a purchase) will be available for trading but will only become available for withdrawal once those sale proceeds or investments have been received in full by TSC.
7.2 If for any reason the anticipated sale proceeds or investments are not received in full you will, along with all other applicable customers of TSC:
if purchasing investments: be entitled, in the chronological order in which instructions were received by TSC, to the relevant investments actually delivered to TSC. In the event of any delivery shortfall, you will receive a cash sum equal to the whole or relevant part of the sum debited from your Account in respect of the relevant investments;
if selling investments: be entitled, in the chronological order in which instructions were received by TSC, to cash actually received by TSC. In the event of any payment shortfall, relevant investments equal to the whole or relevant part of the number of shares, bonds, warrants or units originally sold will be returned to you.
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8. Investment Communications
8.1 TSC undertakes to notify you of all corporate actions relating to your investments where
changes to the share capital of your investments will take place, for example a takeover, a capital raising, a proposal to wind-up, a merger etc.
with a bonus issue or stock split, the resultant stock will be automatically credited to your account and details sent to you after the event
where a capital raising event has an ex-entitlement date e.g. an open offer or rights issue, we will generally send out details of the scheme on the ex-entitlement date
otherwise and where appropriate, subject to paragraph 8.2, you will be sent a summary of the proposal prior to event and the required action (if any) will be taken
where a capital raising event requires an instruction from yourself, if no instruction is received, then any rights, entitlements or warrants will be allowed to lapse. Any lapsed proceeds over £1 will be credited to your TSC account. Sums less than this may be
retained for the benefit of TSC.
all takeover offers will be accepted upon them being declared as going ‘compulsory’ whether or not any instructions have been received from you;
any entitlement to shares will be to the nearest whole share, rounded down, and the aggregate of fractional entitlements may be held by the Nominee for the benefit of TSC. Cash received by the Nominee representing fractional entitlements in excess of £1 will be credited to your account. Sums less than this may be retained for the benefit of TSC;
any charges imposed by the company, its agent or the market including currency conversion charges will be applied to your Account in accordance with paragraph 4.1 above.
8.2 Whilst TSC undertakes to notify you of all corporate actions relating to your investments,
there may be instances where TSC is not advised of a corporate action by the company or its registrar, either at all or in sufficient time, and consequently cannot notify you of the terms of the corporate action. In such event, TSC will accept the default option of the corporate action on your behalf and cannot be held responsible for any loss that you may incur or any other outcome imposed by the company or its registrar.
8.3 If TSC receives notice of a class action or group litigation order that is being proposed or taken concerning your investments, TSC will not be obliged to inform you or act upon that notification.
8.4 Where instructions are sought from you, TSC and the Nominee will (other than as referred to elsewhere within this Agreement or in accordance with any other notified procedure) only act if instructions are received from you (or are reasonably believed to have been received from you or from your authorised agent). Where TSC has not received your instructions by the date specified by TSC within the summary of the corporate action, TSC will take the default option as detailed in the offer letter and cannot be held responsible for any loss that
you may incur. For administration reasons, the date specified by TSC for the provision of your instructions may be earlier than the date specified by the company or its registrar. For the avoidance of doubt, even where you have sufficient funds within your Account, TSC will not exercise any rights, entitlements or warrants (as applicable) on your behalf without your specific instructions.
8.5 If partly paid shares held for you are the subject of a claim for any due balance and no valid instruction is received from you, TSC may sell sufficient of your investments to meet the claim.
8.6 Sometimes the terms of a corporate action will require an election to be made on behalf of
the Nominee’s entire holding in a company on an ‘all or nothing’ basis. To avoid conflicting instructions from customers holding that investment within the Nominee, TSC reserves the right not to offer this entitlement to you: TSC will, however, use its reasonable efforts to
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offer you an alternative entitlement, which may not match the entitlement offered by the
company.
8.7 As your investments are pooled with other customers’ investments, there may be occasions when your entitlement to corporate actions referred to in paragraph 8.1 above are different to what your entitlement would have been had you held the shares in your own name. In such a situation TSC shall take such steps as it considers to be fair in the circumstances, which may include dividing the whole entitlement received from the corporate action between you and other customers or treating any fractional entitlements in the same way as the
company concerned would have done, acting through its registrars.
8.8 An investment will be removed from your Account either upon confirmation from HMRC that the investment is of ‘negligible value’ for the purposes of a claim for Capital Gains Tax purposes under section 24(2) Taxation of Chargeable Gains Act 1992 or if it is declared as dissolved at Companies House.
8.9 You may elect to receive communications, such as an annual report and accounts and any
other information issued to shareholders, in respect of any investment held by you. TSC may inform a company or their agent in which you hold the applicable investment, of your name, address and any other necessary details so the documentation can be sent directly to you.
8.10 Where you hold shares in UK listed companies, you may opt-in for these Shareholder Rights (as defined in Part 9, Companies Act 2006) either via TSC’s website or by contacting TSC’s Shareholder Rights team. TSC will not charge for provision of communications by companies covered by the Companies Act 2006.
8.11 Where you hold shares or investments in companies listed outside of the UK, or in companies within the UK that do not voluntarily comply with the companies Act 2006, (such as some companies that are listed on AIM or unit trusts), you may opt-in to receive communications on an individual case basis by telephoning TSC’s Shareholder Rights team on 0845 185 180 or by emailing shareholder.rights@share. co.uk. TSC may charge for this service.
8.12 For each of your investments, you may apply to TSC for a proxy directing how voting rights are to be exercised. You may also apply for a proxy certificate to attend meetings of
shareholders in companies in which you have invested.
8.13 Shareholder benefits will only be available to you if the relevant company has agreed with TSC to provide them.
9. Liability
9.1 You agree to be responsible for any costs or losses incurred by TSC and/or the Nominee which a reasonable person would consider to have been incurred by them and be reimbursable to them:
as a result of your specific request, fault, omission or dishonesty; and/or
arising from the proper performance of their functions or the proper exercise of the terms of this Agreement, except where such costs or losses are due to their fraud, wilful default or negligence. Neither this paragraph nor anything else within this
Agreement will restrict or exclude any duty or liability owed to you under the rules of the FCA, the Financial Services and Markets Act 2000 (“FSMA”), Financial Services Act 2012 or under common law.
9.2 TSC may, at any time where it reasonably considers it necessary or desirable to do so, suspend all or any of its services including, without limitation, carrying out repairs or
upgrades to hardware or software and correcting any hardware or software error and TSC shall not be liable for any losses incurred by you arising from the suspension.
9.3 Whilst TSC will use its reasonable endeavours to ensure that its Internet websites are available at all times, it will not be liable for any loss or damages resulting from the websites
being inaccessible. Access to the websites may be suspended temporarily or permanently and without notice.
9.4 If TSC fails, interrupts or delays performing its obligations under this Agreement because of
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a breakdown, failure or malfunction of any telecommunications or computer services or
systems (internally or externally) or any other event not reasonably within its control, then TSC will not be liable to you nor will it be responsible for any loss or damage caused or suffered by you as a result of such event. This includes, but is not restricted to, any delay,
breakdown or failure of any transmission or telecommunication or computer systems or facilities, strikes or other industrial action or dispute, or the failure of any relevant exchange, clearing house, broker, independent software vendor, settlement agent or bank to perform its obligations or to operate efficiently and correctly or any other event which is reasonably outside TSC’s control.
9.5 The information contained within TSC’s websites originated by TSC is believed to be correct, but cannot be guaranteed.
9.6 Where TSC provides certain calculator tools on its websites, TSC does not accept responsibility for the validity or results produced by these tools. It is your responsibility to
verify the accuracy of their output.
9.7 Where information, or links to information, on TSC’s websites consists of pricing or performance data or other information which has been obtained from third parties, TSC will not normally have carried out any independent verification of such data and does not accept
liability for any reliance placed upon such data, if that data is proven to be inaccurate or incomplete.
9.8 You undertake not to distribute, sell or license any content contained on, or linked to from, TSC’s websites. You agree that TSC or its authorised agents may at all reasonable times and on reasonable notice have access to and inspect your computer systems, accounts, records
and other documents (in both hard copy and machine readable form) in relation to any suspected re-distribution, re-sale or sub- licensing of such content.
9.9 TSC is not responsible for the security or transmission of electronic instructions either from TSC or from you.
10. Termination
10.1 You may terminate this Agreement immediately by contacting TSC: TSC reserves the right
to request this in writing. TSC may terminate this agreement with reasonable advance notice to you or immediately on written notice if TSC deems there are serious grounds for doing so.
10.2 Where the value of your Account falls below £100, and no investments are held, TSC reserves the right, following reasonable notice, to close your Account, charge accordingly and forward any balance remaining to you.
10.3 In the event of your death, upon receipt of a sealed copy of the UK grant of representation (or equivalent) of your estate, TSC will instruct the Nominee to deliver your cash and investments to your personal representatives. Anti-money laundering regulations may apply.
10.4 If you have a joint Account, in the event of your death the Account will continue in the name of the surviving Account holder. TSC will require proof of death (i.e. an original or office copy of a death certificate) prior to the Account converting to the surviving Account holder’s name.
11. Complaints and Compensation
11.1 If you have a complaint, please contact the department at TSC you have an issue with. You can contact us by any means including letter, telephone or email. If TSC cannot resolve the complaint to your satisfaction, you may be entitled to refer it to the Financial Ombudsman Service, the independent complaints handling body for the financial services industry. A copy
of TSC’s complaints handling procedure is available upon request.
11.2 TSC participates in the Financial Services Compensation Scheme, established under the FSMA, which provides compensation to eligible investors in the event of the firm being unable to meet its customer liabilities. Payments under the protected investment business scheme
are limited to a maximum of the first £50,000 of the claim. Further information is available from TSC’s Compliance team.
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12. General
12.1 All written or electronic communications TSC sends you will be to the latest address notified
by you to TSC and shall be assumed received by you on the second day after posting or on the day after despatch in the case of electronic communication. Communications sent by you shall be deemed received only if actually received by TSC.
12.2 Should you cease to live in a qualifying country (see 3.6 above), your Account will be
terminated in accordance with 10.1 above. All investments held can either be transferred to you, another financial intermediary or sold; any money and/or sale proceeds will be returned to you.
12.3 You agree that TSC may from time to time telephone, email or otherwise contact you to discuss potential or existing investments or investment services, subject to compliance with
the rules of the FCA, and you are willing to accept such calls. You can opt out of receiving this marketing information either by indication on your application, via My Profile or by calling us on 01296 414141
12.4 Telephone calls may be recorded for the purposes of training, quality control and monitoring
and confirming regulatory compliance.
12.5 TSC and the Nominee may employ agents on such terms as they think fit. TSC will satisfy itself that any person to whom it delegates any of its functions or responsibilities under the terms agreed with you is competent to carry out those functions and responsibilities. TSC
will take reasonable care in the selection and supervision of such agents.
12.6 Should any clause within this Agreement or part thereof become or be declared illegal, invalid or unenforceable for any reason, the remainder of the clause and Agreement shall be unaffected and shall remain in full force and effect.
12.7 The Contracts (Rights of Third Parties) Act 1999 will not apply to this Agreement, meaning that only you and TSC have the right to enforce any of the terms and conditions mentioned.
Section 2
Additional terms of business for Enterprise Investment Scheme, Seed Enterprise Investment Scheme and Business Property Relief Accounts
The terms of business in this section are only relevant to you if you are opening an Enterprise Investment Scheme (“EIS”), Seed Enterprise Investment Scheme (“SEIS”) or a Business Property Relief (“BPR”) Account, in which case, the terms of business in paragraphs 1 to 13 shall also apply, where relevant. Should any terms within paragraphs 1 to 13 conflict with these Additional Terms of Business, the Additional Terms of Business will prevail.
13. EIS, SEIS and BPR Accounts
14. 13.1 You acknowledge that TSC:
is the administrator and custodian of your Account;
is not the fund manager of the Account and is not responsible for the suitability or appropriateness of the Account, either at the point of sale or thereafter;
may only act upon the instructions of the fund manager in relation to your Account;
is not responsible for the contents of any documentation relating to the Account, other than these terms of business or other documentation required to be sent to you by TSC in discharge of TSC’s regulatory obligations. In particular, TSC is not responsible
for the contents of the Account information memorandum, brochure or prospectus, and has not issued or approved the contents of these documents in accordance with Section 21 FSMA.
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Section 3
Schedule 1
Conflicts of Interest Policy - Summary Version
TSC aims to identify and prevent conflicts of interest which may arise between itself and its
customers, and between one customer and another, in order to avoid any adverse effect on its customers. This Policy sets out procedures, practices and controls in place to achieve this. The avoidance of potential conflicts of interest is a key consideration, so operational structures and procedures, password-controlled systems, data hierarchy, and the clear segregation of roles and responsibilities are all designed to work preventing any conflicts arising in the first place. This Policy applies to all officers (whether Executive or Non-Executive), employees and any persons directly or indirectly linked to the Share plc group of companies (“the Group”) and refers to all interactions
with all customers of the Group.
Scope
Types of conflict which may carry a material risk of damage to the interests of a customer include, but are not limited to, the following. Where the Group or any person directly or indirectly linked to the Group:
is likely to make a financial gain or avoid a financial loss at the expense of the customer;
has an interest in the outcome of a service provided to, or of a transaction carried out on behalf of, the customer which is distinct from that customer’s interest in that outcome;
has a financial or other incentive to favour the interest of another customer or group of customers over the interests of the customer;
carries on the same business as the customer;
receives, or will receive, from a person other than the customer an inducement in relation to the service provided to the customer in the form of monies, goods or services, other than
the standard commission or fee for that service;
designs, markets or recommends a product or service without properly considering all the
Group’s other products and services and the interest of their customers.
Guarding against conflicts of interest
A number of different safeguard systems and processes are in place in order that the potential for conflicts of interest is minimised:
personal account dealing requirements upon all officers, employees and certain associates of TSC in relation to their own investments;
an Investment Research Policy covering the production and dissemination of investment research by TSC;
a Register of Information logging receipt and use of any ‘inside information’ by TSC;
Chinese Walls restricting the flow of price sensitive information within TSC;
a Gifts and Inducements Log registering the solicitation, offer or receipt of certain benefits
to staff;
external business interests conflicting with TSC’s interests are prohibited for TSC’s officers and employees, unless Board approval is provided;
job roles and system access is subject to appropriate segregation of duties considerations, detailed within a separate Policy;
remuneration packages within TSC are structured to minimise any link with levels of business generated with retail customers;
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corporate governance requirements are followed as appropriate to the size and nature of
Share plc;
legal and regulatory record keeping requirements are followed, including the maintenance of a Privacy Policy for Internet users;
a Public Interest Disclosure Policy (“whistleblowing”) is in place for TSC employees;
where a conflict of interest arises, TSC will, if known, disclose it to a customer prior to undertaking investment business for that customer.
A full version of the Conflicts of Interest Policy is available on request from TSC’s Compliance team.
Schedule 2
Order Execution Policy
Part One: The Quality of Execution
When executing orders on behalf of customers in relation to shares and other financial instruments, TSC will take all reasonable steps to achieve what is called “best execution” of
customer orders. This means that TSC has in place a policy and procedures which are designed to obtain the best possible execution result, subject to and taking into account:
the nature of customer orders;
the priorities the customer places upon TSC in filling those orders; and
the market in question,
and which provides, in TSC’s view, the best balance across a range of sometimes conflicting factors.
TSC will take into consideration a range of different factors which include not just price, but which may also include such other factors as the cost of the transaction, the need for timely execution,
the liquidity of the market (which may make it difficult to execute an order), the size of the order
and the nature of the financial transaction.
TSC’s commitment to provide its customers with “best execution” does not mean that TSC owes customers any fiduciary responsibilities over and above the specific regulatory obligations placed upon TSC or as may be otherwise contracted. While TSC will take all reasonable steps, based on
those resources available to it, to satisfy itself that it has processes in place that can reasonably be expected to lead to the delivery of best execution of customer orders, TSC cannot guarantee that it will always be able to provide best execution of every order executed on each customer’s behalf.
Part Two: Order Execution Policy
1. Your orders must be received on either a ‘best price’ or ‘limit price’ basis and are subject to the requirements of this execution policy.
2. Where your order is received with specific instructions as to how the order should be
executed, the order will be executed in line with those instructions. It is important to note that your specific instructions may prevent TSC from taking the steps it has designed and implemented in this policy to obtain the best possible result for the execution of customer orders.
3. Customer orders received for transferable securities, i.e. shares, exchange traded funds (‘ETFs’), exchange traded commodities (‘ETCs’), warrants, covered warrants and investment trusts will be executed on one of the following markets:
London Stock Exchange (“LSE”); the LSE is a regulated market and one of the larger,
better known European markets for dealing in both UK and international shares;
Alternative Investment Market (“AIM”); a market for smaller-capitalisation growth companies. AIM is a not a regulated market, but is an exchange-regulated market
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owned by the LSE; and
such other markets and Recognised Investment Exchanges as TSC considers
appropriate in the circumstances.
4. The choice of market depends on which market or multilateral trading facility (‘MTF’) a particular security is traded on, for example, where a security is only traded via the LSE, the customer order can only be executed via the LSE. Where the same customer order can be
executed on either of two separate markets and where TSC can trade on both, TSC will choose the market that will provide the best possible result for that customer order.
5. Customer orders are usually executed via specialist market makers known as Retail Service Providers (“RSPs”). TSC deals with a number of RSPs, all of whom are members of the LSE and authorised and regulated by the FCA. The RSPs quote a price and size in securities in
which they are registered to deal and make this information available via various information vendors. The range of RSPs available to TSC will be dependent on which RSPs are accessible through the information vendor used; TSC will be linked to one or more information vendors
which provide access to a wide range of RSPs.
6. When TSC receives your order, the order is passed, via an information vendor, to an automated polling system which connects directly to the appropriate RSPs registered with that information vendor. The automated polling system will then identify the RSP offering the best price for your order and this information is sent back to TSC for acceptance.
7. On some occasions, where the RSP is unwilling or unable to execute your order electronically, the order will have to be executed manually with the RSP over the telephone.
8. If your order is for a bond or gilt-edged security, it will be executed either:
with an RSP; or
electronically via Bondscape, an automated service designed primarily for brokers and other professional investment advisers trading small sizes of fixed interest securities. Prices are provided by participating market makers. The service
automatically selects the best price for execution from the competing market makers.
9. If your order is for collective investment schemes (i.e. unit trusts and/or OEICs), it will be executed either directly via the relevant fund manager or via Cofunds.
10. There are a number of different execution factors which can affect the outcome of your orders e.g. price, cost, speed, the likelihood of execution and settlement, the size and nature of the order. However, as TSC does not differentiate charging structures or settlement processes between execution venues, TSC considers the most significant factor to be the price at which the order can be executed. By achieving the best price possible given the execution venues available, TSC delivers the best possible result for customer orders received.
Part Three: Client Acknowledgement
By placing an order with TSC, you acknowledge that:
you have been made aware of and accept the nature, policy and procedures which TSC has in place for providing best execution as defined in this Order Execution Policy;
in the absence of any express instructions from you, TSC shall have full discretion to choose a relevant venue from its current list of venues for executing any order or orders; and
in choosing an execution venue, TSC will assess and balance a range of all relevant factors, including those set out in this policy, which, in its reasonable determination, TSC considers relevant to achieving the best result for you.
Schedule 3
Order Allocation Policy
Where TSC considers it necessary and in the best interests of its customer(s), your order may be
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aggregated (i.e. combined) with orders received from other customers.
You should be aware that aggregating orders in this way may work to your disadvantage. This
may be because your shares will be bought or sold alongside shares of other customers, the price you pay or receive may not be the same as it would have been if those shares had been bought or sold non- aggregated. The market may also quote a different price because of the larger number of shares being bought or sold together. The price you pay or receive could, therefore, be higher or lower than if your shares had been bought or sold on their own.
Your order will only be carried out if the total order can be dealt, i.e. your order will not be partially filled.
If you apply for a new issue of securities (e.g. within an initial public offer or placing) and that offer is oversubscribed, you may receive a partial allocation of securities or none at all. The
allocation guidelines of the offer will be followed wherever practicable by TSC when deciding how to allocate securities where the full amount applied for has not been distributed. In the absence of any guidelines, TSC will allocate the securities pro rata to each customer’s application within
the offer.
PO Box 2000 Aylesbury Buckinghamshire HP21 8ZB phone 01296 41 41 41 deal 01296 41 42 43 fax 01296 41 41 40 email [email protected] web www.share.com The Share Centre Limited is a member of the London Stock Exchange and is authorised and regulated by The Financial Conduct Authority under reference number 146768. Registered in England number 2461949 Registered office Oxford House Oxford Road Aylesbury Bucks HP21 8SZ EISatobs 0516
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SECTION 7
DEFINITIONS
“Advisory Committee” means the Advisory Committee of the Portfolio Manager from time to time
“AIM” means the AIM Market operated by London Stock Exchange plc
“Applicable Laws” means the FCA Rules, FSMA, the MLR and the DPA, and all other applicable laws, regulations, rules evidential provisions and directions of any applicable regulatory body (including without limitation, the FCA)
“Application Form” means the application form completed (or to be completed) by the Investor pursuant to which the Investor invests in the Bamboo Growth Opportunities Portfolio Service and becomes subject to the terms and conditions of the Investor Agreement
“Associate” means any person or entity who is under the common control of another person or
entity
“Bamboo” or “Bamboo Capital” means Bamboo Capital Management Limited, a company registered in England and Wales under company number 10076053
“Bamboo EIS Portfolio Service” means the portfolio management service known as the Bamboo EIS Portfolio Service provided by Bamboo
“BPR” means business property relief, a relief from inheritance tax (as set out in Chapter 1 of part
V of the Inheritance Tax Act 1984)
“BPR qualifying company” means a company whose shares are relevant business property for the purposes of BPR
“BPR qualifying investment” means an investment in a BPR qualifying company
“COBS” means the Conduct of Business sourcebook rules (as defined in the FCA handbook)
“Custodian” means The Share Centre Limited of Oxford House, Oxford Road, Aylesbury, Buckinghamshire HP21 8SZ (or any replacement custodian from time to time)
“Custodian Agreement” means the custodian agreement to be entered into between each Investor and the Custodian
“DPA” means the Data Protection Act 1998
“EIS” means the Enterprise Investment Scheme (as set out in the Income Tax Act 2007 and Part
IV and Schedule 5B of the Taxation of Chargeable Gains Act 1992)
“EIS qualifying company” means a company which is a qualifying company for the purposes of EIS
“EIS qualifying investment” means a prescribed investment into an EIS qualifying company
“EIS tax relief” or “EIS relief” means Enterprise Investment Scheme tax relief, as provided for in Part 5 of the Income Tax Act 2007 and Part IV and Schedule 5B of the Taxation of Chargeable Gains Act 1992
“FCA” means the Financial Conduct Authority, which expression shall include any replacement or substitute person and any regulatory body or person succeeding (in whole or part) to the functions of the FCA
“FCA handbook” means the handbook of rules, regulations and guidance issued by the FCA
“FCA Rules” means the rules issued by the FCA from time to time, including (without limitation) the FCA handbook
“FSMA” means the Financial Services and Markets Act 2000
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“GAV” means, in respect of a Portfolio as at a GAV Calculation Date, the aggregate value of
uninvested cash and Investments in the Portfolio (after adding back any annual management fees for the relevant period), as calculated by the Portfolio Manager as at such GAV Calculation Date
“GAV Calculation Date” means, in respect of an Investor and the Growth Opportunities Portfolio Service, 31 December in each year and the Termination Date
“High Water Mark” means, when calculating the annual performance fee as at a GAV Calculation
Date, the amount which is the greater of:
(a) the Net Subscription Amount; and
(b) the highest GAV calculated as at any prior GAV Calculation Date
“Information Memorandum” means this information memorandum published by the Portfolio Manager from time to time in relation to the Bamboo Growth Opportunities Portfolio Service
“Investee Company” means a company in which the Bamboo Growth Opportunities Portfolio
Service makes an Investment
“Investment” means an investment by the Bamboo Growth Opportunities Portfolio Service in a company
“Investment Objectives” means the investment objectives of the Bamboo Growth Opportunities Portfolio Service, as set out in this Information Memorandum
“Investor” means an individual who completes an Application Form, which has been accepted by the Custodian
“Investor Agreement” means the agreement entered into by an Investor and the Portfolio Manager, which becomes effective when the Investor executes the Application Form and has been notified that the Application Form has been accepted by the Custodian
“IPO” means, in respect of a company, an Initial Public Offering or flotation of its shares on a
recognised stock market (including, without limitation, AIM)
“ISA” means an “Individual Savings Account” as provided for pursuant to The Individual Savings Account Regulations 1998 (SI 1998 No.1870)
“Minimum Period” means, in respect of an Investment, the period ending on the date falling two years after the date of such Investment
“MLR” means the Money Laundering Regulations 2007
“Nominee” means a nominee appointed by the Custodian to hold shares (as nominee) in any Investee Company from time to time
“Non-readily realisable investments” means an investment in which the market is limited, or could become so, as a result of which the investments can be difficult to deal in and can be difficult to assess what would be a proper market price for such Investment
“Portfolio” means, in respect of an Investor, the portfolio of assets (including uninvested cash and shares in Investee Companies) under management in accordance with the terms and conditions of the Bamboo Growth Opportunities Portfolio Service (as set out in this Information Memorandum and the Investor Agreement)
“Portfolio Manager” means Bamboo Capital Management Limited, a company registered in England and Wales under company number 10076053 (or any replacement portfolio manager from time to time)
“Portfolio Service” or “Bamboo Growth Opportunities Portfolio Service” means the portfolio
management service known as the Bamboo Growth Opportunities Portfolio Service (as described in this Information Memorandum)
“SIPP” means a self-invested pension plan
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SECTION 8
FREQUENTLY ASKED QUESTIONS
REPLIES TO THESE FREQUENTLY ASKED
QUESTIONS SHOULD BE READ IN CONJUNCTION WITH THE WHOLE OF THE INFORMATION MEMORANDUM AND ANY DECISIONS TO INVEST IN THE PORTFOLIO SERVICE SHOULD BE BASED ON CONSIDERATION OF THE INFORMATION MEMORANDUM AS A WHOLE.
Making an investment in the Portfolio Service
Who can apply to invest?
Investors can only invest in the Bamboo Growth Opportunities Portfolio Service directly or through their financial adviser.
Investors must be aged 18 or over.
What is the minimum investment in the
Portfolio Service?
The minimum investment in the Portfolio Service is £25,000. You can invest in multiples of £5,000 above this minimum.
What is the maximum subscription to the
Portfolio Service?
There is no maximum subscription, but the
maximum amount which an individual investor can invest through an ISA in any tax year is £15,240.
What is the size of the Portfolio Service likely to be?
The Portfolio Manager is initially targeting an aggregate investment in the Bamboo Growth Opportunities Portfolio Service of £50 million over three tax years, but there is no absolute
limit to the amount being raised. The Portfolio Service will remain open for investments until
further notice.
Can I withdraw money from the Bamboo
Growth Opportunities Portfolio?
As stated in this Information Memorandum, an Investor must commit to the Bamboo Growth Opportunities Portfolio Service for a period of five years from the date of
investment. You will not be able to withdraw funds or have Investments transferred to you prior to the expiry of this five year period.
How do I apply?
Please fill out the Application Form. Copies of the Application Form are available from your financial adviser or the Portfolio Manager or can be downloaded from the Portfolio Manager’s
website.
To whom do I make my cheque payable and where do I send it?
Please make cheques payable to The Share
Centre and send your cheque and Application Form to The Share Centre Limited of Oxford House, Oxford Road, Aylesbury, Buckinghamshire HP21 8SZ.
How is my money held prior to investment through the Portfolio Service?
Your money will be held on your behalf by the
Custodian (together with the money of other Investors) in the in the Bamboo Growth Opportunities aggregated client bank account with an FCA approved bank by the Custodian. The Custodian will set up for each Investor an internal account with an allocated reference number to ensure your money is clearly
identifiable. Any interest over a de minimis amount (as determined by the Custodian from time to time) will be credited to your account.
How do I follow the progress of my investment?
You will receive a valuation statement every six months, or (if requested) every three months in accordance with the FCA Rules. Reporting will ordinarily be completed as at 30 September
and 31 March in each year.
What is the investment strategy of the Bamboo Growth Opportunities Portfolio Service?
The Portfolio Service will invest in a portfolio of companies with the potential for significant growth.
What type of companies will Bamboo Growth Opportunities Portfolio Service invest in?
The Investee Companies will be either unquoted
companies (namely companies whose shares are not publicly listed on a stock exchange), or companies that are already listed on AIM.
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When will realisations of investments be
made?
The intention is to realise your investments within three years of subscription into the Investee Companies, but the exact timing will depend on the commercial circumstances at the relevant time.
Costs and expenses what initial fees are there?
An initial fee of two per cent (2%) of the funds invested in the Portfolio Service will be payable
by Investors.
What is the annual fee?
The Portfolio Manager will charge an annual management fee of two per cent (2%) of the amount invested in the Portfolio Service.
Are there any performance fees?
The Portfolio Manager will also be entitled to an annual performance fee on the basis set out in section 3 of the Information Memorandum. The annual performance fee is calculated at the rate of twenty per cent (20%) of any increase in the
gross asset value over the higher of (a) the net subscription amount and (b) the highest annual gross asset valuation of the Portfolio. There is also a super-performance fee payable if realisations in respect of an investment in a
company exceed two hundred and fifty per cent
(250%) of the amount originally invested in such company. The super-performance fee is payable at the rate of fifty per cent (50%) of such excess. Please refer to section 3 of the Information Memorandum for further detail.
Is VAT payable?
All Portfolio Manager fees may be subject to Value Added Tax.
What other fees and expenses are there?
Charges for the custodian and nominee services are an administration fee of £75 per annum
(plus VAT) and a dealing fee of 0.35% in relation to sales and purchases.
The Portfolio Manager may charge Investee Companies arrangement, monitoring or other fees (including fees in respect of any person
acting as a director or other officer appointed to Investee Companies).
The Portfolio Manager may also engage external advisers and consultants in connection with
investments in Investee Companies and realisations of Investee Companies and, as a result, fees or incentive payments may be
payable to such third parties.
How are financial adviser fees paid?
Fees payable to your financial adviser can either be paid directly by you or by Bamboo on your behalf. Bamboo can facilitate the upfront payment of such fees on your behalf. Bamboo
can also facilitate the payment of ongoing fees for a maximum of four years if you have agreed to pay your financial adviser for providing ongoing services in relation to your investment in the Bamboo Growth Opportunities Portfolio Service. Where Bamboo facilitates payment of fees to financial advisers, these fees will not
count towards the amount available for investment in Investee Companies.
Tax reliefs
Please refer to the Risk Factors set out in Section 4 of this Information Memorandum which explain that particular tax reliefs are dependent on individual circumstances and that the taxation rates may be subject to change. We are not able to give you tax
advice and you should consult your tax adviser.
What are the principal tax reliefs?
Up to one hundred per cent (100%) inheritance tax relief is potentially available on BPR qualifying investments held through the
Bamboo Growth Opportunities Portfolio Service.
If an Investor subscribes into the Bamboo Growth Opportunities Portfolio Service through an ISA, any gains on disposals of Investments will be exempt from capital gains tax.
An Investor is also able to subscribe into the Bamboo Growth Opportunities Portfolio Service through their SIPP.
You are referred to Section 2 of this Information Memorandum for more details of potential tax benefits. However, please note
that we are not providing taxation advice and therefore you should seek independent advice.