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TRUST MANAGEMENT RULES
of "Maxwell Bonds Fund" open-end mutual investment bonds fund
managed by Maxwell Asset Management Ltd
I. General provisions
1. The name of the open-end mutual investment fund: Maxwell Bonds Fund open-end mutual investment fund managed by Maxwell Asset Management Ltd. (hereinafter referred to as the "Fund").
2. Type of the Fund shall be open-end.
3. The full corporate name of the Fund's managing company: Maxwell Asset Management Limited Liability Company (hereinafter referred to as the "Managing Company").
4. Location of Managing Company: 1 Bolshaya Yakimanka Street, 119180 Moscow, Russian Federation
5. License of Managing Company dated June 17, 2003, No. 21-000-1-00122, issued by the Federal Financial Markets Service.
6. The full corporate name of Fund's specialized depository (hereinafter referred to as the "Specialized Depository"):
Depository Ircol Limited Liability Company.
7. Location of Specialized Depository: Build. 1, 4/3 Myasnitsky Proezd, 107078 Moscow, Russian Federation.
8. License of Specialized Depository dated December 20, 2000, No. 22-000-1-00023, issued by the Federal Securities Market Commission.
9. Specialized Depository has the right to engage any other depository in the performance of its obligations on custody and (or) registration of rights over the securities included in Fund.
10. The full corporate name of the entity maintaining the register of holders of Fund's investment units (hereinafter referred to as the "investment units"): Ircol Closed Joint-Stock Company.
11. Location of the entity maintaining the register of the investment units' holders: Build. 1, 3/4 Boyarsky pereulok, 107078 Moscow, Russian Federation.
12. License of the entity maintaining the register of investment units' holders, dated August 9, 2002, No. 10-000-1-00250, issued by the Federal Securities Market Commission.
13. The full corporate name of Fund's auditor:
Consulting & Auditing firm Delovaya Perspektiva Limited Liability Company (hereinafter referred to as the "Auditor").
14. Location of Fund's Auditor: Build. 1, 6 Maly Palashevsky pereulok, 103104 Moscow, Russian Federation.
15. Auditor's license dated August 1, 2003, No. Å 004799, issued by the Finance Ministry of the Russian Federation.
16. Fund's trust management rules (hereinafter referred to as the "Rules of Fund") determine conditions for Fund's trust management.
The settlor of trust management shall transfer the property into trust management of Managing Company so that such property be consolidated with the property of other trust management settlors and included into Fund for a certain term, whereas Managing Company shall carry out trust management in the interests of the settlor of trust management.
Accession to Fund's trust management agreement shall be via acquisition of investment units being issued by Managing Company.
17. The property included in Fund shall constitute the common property of the trust management settlors - investment units' holders (hereinafter referred to as the "investment units' holders") and be co-owned by them. No separation of assets included in Fund and division of any share of such in kind shall be allowed.
Accession to Fund's trust management agreement shall mean refusal of investment units' holders from exercising their preemptive right to acquire a share in the title over the property included in Fund.
18. The investment units' holders shall bear the risk of losses related to the fluctuations in the market value of the assets included in Fund.
19. Term of Fund formation shall be from July 25, 2005 to October 24, 2005 or before that date, once the value of Fund's property reaches 30,000,000.00 rubles. (Thirty million rubles and zero kopecks).
20. In case on expiry of the term set for Fund formation the value of the assets is below than the amount on the achievement of which Fund is deemed to be formed, Fund trust management agreement with all the investment units' holders shall cease to be valid. In this case Fund shall be terminated in accordance with the Federal Law "On Investment Funds". No fees charged to the benefit of Managing Company, Specialized Depository, Entity maintaining the register of investment units' holders, and Auditor shall be paid, whereas the expenses related to Fund's trust management and termination of Fund shall not be reimbursed.
21. The expiration date of Fund's trust management agreement shall be July 25, 2020.
22. The period of validity of Fund's trust management agreement shall be deemed as extended for the same duration unless investment units' holders demand redemption of all investment units held by them by the moment of the agreement's expiration, set by Rules of Fund.
II. Investment declaration
23. The investment policy of Managing Company is aimed at short-term investment into securities to obtain a gain on the property included in the Fund.
24. The property included in Fund may be invested into:
§ state securities of the Russian Federation;
§ state securities of subjects of the Russian Federation;
§ municipal securities;
§ equities in Russian open joint-stock companies, with the exception of equities in Russian joint-stock investment funds;
§ bonds of Russian economic societies, the state registration of the issue of which was accompanied with the registration of the bond issue prospectus or with regard to which a prospectus has been registered;
§ securities of foreign states;
§ securities of international financial institutions;
§ equities of foreign joint-stock companies;
§ bonds of foreign commercial organizations;
§ investment units of open-end mutual investment funds of the money market funds and bonds funds categories.
The Fund's assets shall be invested into ordinary and preferred equities of issuers inside Russia and into the equities of foreign issuers that mainly belong to the following industries: power industry, fuel industry, communications and telecommunications, chemical industry, mechanical engineering and metal-working, metallurgy, trade, transportation, food industry, financial sector and insurance, forest, woodworking, pulp & paper industry, mining industry, construction, science & science service, building materials industry, consumer industry, housing maintenance & utilities, petrochemical industry, medical industry, printing industry, agriculture, glass, porcelain & earthenware industry, fragrance & cosmetics industry.
The assets included in Fund may be invested into the bonds issued by:
- federal executive authorities of the Russian Federation;
- executive authorities of subjects of the Russian Federation;
- local authorities;
- foreign states;
- international financial institutions;
- Russian and foreign legal entities.
Fund's assets may include monetary funds, including foreign currency on accounts and as deposits in credit institutions.
Only the securities for which the recognized quotations are available as of the date of entry into the purchase agreement or as of the prior date can be acquired as Fund's assets. The above requirement does not apply to the investment units of open-end mutual investment funds, and the state securities of the Russian Federation, terms of issue and circulation of which envisage secondary circulation on the securities market, should such securities be acquired in the course of their distribution via auction.
Securities of issuers inside Russia, investment units in mutual investment funds, securities issued by foreign states and international financial institutions, in which the assets included into Fund shall be invested, can be both included and left out from the stock exchange quotation lists.
Acquisition of foreign currency, foreign currency securities as Fund's assets shall be accomplished in the manner set forth by the foreign exchange control law.
Fund's assets shall not include:
- equities in Russian joint-stock investment funds and investment units in mutual investment funds, should the investment reserves of such joint-stock investment funds or such mutual investment funds be under trust management (management) of the same managing company which is entrusted with the management of Fund;
- state securities of subjects of the Russian Federation and municipal securities left out from the equity exchange quotation lists;
- securities of foreign states and those of international financial institutions, left out from the list approved by the federal executive body for the securities market.
Equities in foreign joint-stock companies and bonds from foreign profit organizations may be included in the Fund's assets provided that they have passed the listing procedure at equity exchanges inside the states, with the state bodies of which (monitoring the securities market) the federal executive body for the securities market has concluded, pursuant to the applicable procedure, the cooperation & data exchange agreement.
Within the term of Fund formation its assets shall only be composed of the property contributed by investment units' holders.
25. The structure of Fund's assets shall simultaneously comply with the following requirements:
- the monetary funds deposited in a single credit institution may not exceed 25 percent of the value of the assets;
- the estimated value of equities in Russian open joint-stock companies and equities of foreign joint-stock companies may not exceed 40 percent of the value of the assets;
- the estimated value of securities from foreign states, securities issued by international financial institutions, equities in foreign joint-equity companies and bonds from foreign profit organizations shall not exceed 20 percent from the value of the assets;
- during no less than two-thirds of the days that are not weekends and public holidays, within one calendar month, the estimated value of state securities of the Russian Federation, state securities of subjects of the Russian Federation, municipal securities, bonds from Russian economic societies, bonds from foreign profit institutions, securities of international financial institutions and securities of foreign states shall be at least 50 percent of the value of the assets;
- the estimated value of state securities of the Russian Federation or state securities of subjects of the Russian Federation from one and the same issue may not exceed 35 percent from the value of the assets;
- the estimated value of securities from one issuer (save for state securities of the Russian Federation and state securities of subjects of the Russian Federation) may not exceed 15 percent from the value of the assets;
- the estimated value of the securities which have no recognized quotations, save for the investment units in open-end mutual investment funds, may not exceed 10 percent from the value of the assets;
- the estimated value of the equities in Russian joint-stock companies and bonds issued by Russian economic societies, entered into the "I" equity exchange quotation list, and also of those left out from the equity exchange quotation lists, may not exceed 50 percent from the value of the assets;
- the estimated value of the equities in Russian joint-stock investment funds and investment units of mutual investment funds may not exceed 10 percent from the value of the assets;
- the quantity of the investment units in the mutual investment fund may not exceed 30 percent from the quantity of the issued investment units in such mutual investment fund.
This clause shall become valid on completion of Fund formation.
26. Description of investment-related risks.
Investment into securities is associated with high risk and does not imply any guarantee on behalf of the issuer, both with respect to repayment of the principal and the interest charged upon such. Besides that, the risks of investing into securities include the following:
increased political risk of expropriation, confiscatory taxation, the failure of the state to perform its securities-related obligations, devaluation and fluctuation in the currency exchange rates, the policy aimed at the curbing of investment profitability, including but not limited to restriction of investment into the industries which make the sphere of such state's particular concern.
Managing Company shall take every action required to ensure complete credibility and trustworthiness of the information which shall be used as a basis for acquisition of the securities. Nonetheless, the investor shall bear the risk of losses related to the decrease in the value of fund's investment units. The investment profitability is not guaranteed in future; neither shall the state guarantee profitability of the investment in Fund. Past performance indicators of Managing Company shall not guarantee Fund's profitability in future; the investor shall independently make a decision on whether or not purchase units in Fund after having studied these Rules of Fund, its investment declaration and assessment of the respective risks.
III. Rights and obligations of Managing Company
27. Managing Company shall perform trust management of Fund by way of any legal and actual actions with regard to the property included in Fund.
Managing Company shall make transactions with the property included in Fund, in its own name, thereby specifying that the company acts as a trustee. This condition shall be considered as respected if, in the performance of actions which do not have to be executed in writing, the counterparty notified on the performance thereof by the trustee in this capacity, whereas in written documents a "Ä.Ó." ("Tr.") note is made following the name of Managing Company and Fund name is specified.
In the absence of the note that Managing Company is acting in the capacity of the trustee, it shall be personally liable to the third parties and responsible to them only to the extent of the property it owns.
28. Managing Company is entitled to:
§ exercise, in the absence of a special power of attorney, every right certified by the securities included into Fund, including the right to vote under the voting securities;
§ bring actions and act as defendant in court with relation to performance of Fund trust management activities;
§ make option transactions, as well as forward and future deals at the expense of the assets included in Fund, solely for the purpose of reducing the risk of a decline in the value of Fund's assets. The general scope of obligations related to the options, forward and future contracts shall not exceed 10 percent of the value of Fund's assets;
§ transfer its rights and obligations under Fund's trust management agreement to any other managing company pursuant to the procedure set forth in the regulatory legal acts issued by the federal executive body for the securities market;
§ pass a decision on the termination of Fund.
29. Managing Company undertakes to:
§ perform Fund's trust management in compliance with the Federal Law "On Investment Funds", other federal laws, regulatory legal acts issued by the federal executive body for the securities market and Rules of Fund;
§ act in reasonable and bona fide manner, perform Fund's trust management to the benefit of investment units' holders;
§ transfer into Specialized Depository the assets included in Fund, for registration and (or) custody, unless otherwise is stipulated in the regulatory legal acts of the Russian Federation for separate types of property;
§ transfer, without a delay, copies of all recording mediums related to the property included in Fund into Specialized Depository upon the execution or receipt of such.
30. Managing Company is not entitled to:
§ dispose the assets included in Fund without consent of Specialized Depository, save for the disposal of the securities for the purpose of execution of transactions made via the trade institutors;
§ acquire at the expense of the assets included in Fund any objects not stipulated by Fund's investment declaration;
§ make any transactions that shall eventually cause violation of requirements contained in the Federal Law "On Investment Funds", regulatory legal acts of the Russian Federation, regulatory legal acts of the federal executive body for the securities market and Rules of Fund;
§ gratuitously alienate assets included in Fund;
§ undertake to transfer the property that is not included in Fund as of the moment of such undertaking, save for the securities transactions made via the trade institutor, the rules of which envisage the delivery versus payment;
§ receive, subject to conditions of loan agreements and credit agreements, the monetary funds, redeemable at the expense of the property included in Fund, for the purpose of using the above funds as to redeem (repay) the investment units given the shortage of monetary funding included in Fund. Thereby, under all loan and credit agreements, the aggregate amount of debt redeemable at the expense of the property included in Fund shall not exceed 10 percent of the value of Fund's net assets. The timeframe envisaged for debt financing under each loan agreement and credit agreement (the extension timeframe included) shall not exceed 3 months;
§ extend loans on account of the property included in Fund;
§ use the property included in the Fund to ensure performance of it's own obligations, which are not related to the trust management of Fund, or to perform third-party obligations;
§ acquire at the expense of the assets included in Fund objects of investing from its affiliated entities, save for the securities included into the listing of a trade institutor;
§ acquire at the expense of the assets included in Fund investment units in other mutual investment funds managed by Managing Company;
§ acquire the property included in Fund, save for the cases of being given fees pursuant to Rules of Fund, and reimbursement of the amount of it's own monetary funds Managing Company has used to redeem the investment units (payment of pecuniary compensation due to redemption of the investment units). Thereby Managing Company has no right to charge interest for the usage of it's monetary funds;
§ alienate it's own property into the assets included in Fund under it's trust management;
§ acquire into the assets included in Fund securities issued by Managing Company, Specialized Depository or Fund's Auditor, and their affiliated entities, save for the securities included into the listing of a trade institutor.
31. Managing Company shall incur the obligations set forth in Rules of Fund, whether or not the applications for acquisition, redemption and exchange of the investment units are accepted directly by Managing Company or agent (agents) responsible for the issue, redemption and exchange of the investment units (hereinafter referred to as the agent).
In case of suspension or cancellation of an agent's license for performance of the brokerage activity, termination of agreement with such agent, cancellation or expiration of the validity term of the power of attorney of such agent has been issued by Managing Company, Managing Company is obliged to ensure (via any other agent as well) acceptance of applications for redemption of the investment units in the same settlement where the agent accepts the applications.
IV. Rights of investment units' holders.
Investment units
32. The rights of investment units' holders shall be certified by the investment units.
33. An investment unit is a registered security that certifies:
§ the interest of its holder in the title of property over assets included in Fund;
§ the right to demand proper Fund's trust management from Managing Company;
§ the right to demand that Managing Company redeems the investment unit and repays the pecuniary compensation in this connection, matching the interest in the right for common property included in Fund, any business day.
34. Each investment unit shall certify an equal interest in the right of common property over assets included in Fund and equal rights.
The investment unit is not an equity security.
The rights certified by the investment unit shall be recorded in the book-entry form.
The investment unit shall have no nominal value.
The issue of investment units' derivatives shall not be allowed.
35. The quantity of investment units issued by Managing Company shall not be limited.
36. Once a non-integral quantity of investment units is awarded to one holder, the quantity of the investment units shall be determined to the fifth decimal place.
37. The investment units shall have free circulation on completion of Fund formation. Any restrictions for the investment units' circulation shall be determined by the federal law.
38. The rights for investment units shall be recorded in the register of investment units' holders and on securities accounts by depositories.
39. The procedure of reporting from the register of investment units' holders.
The entity maintaining the register of investment units' holders shall deliver statement of personal account as of a certain date. Such statements shall be given based on:
§ a registered person's application for statement provision;
§ an application from the person in the name of which an "investment units of unidentified person" account is opened;
§ a notary's request related to the commencement of succession;
§ a request from the court, a law enforcement or a tax body, and any other authorized state body.
The entity maintaining the register of investment units' holders is obliged, upon application (request) from the persons specified in this clause of Rules of Fund, provide a statement from the register of investment units' holders within 3 days upon receipt of the application (request) or send a rejection notice concerning the statement that contains the grounds for such rejection, within 5 days upon the receipt.
In the absence of any other method of delivering the statement in the account details, such statement shall be awarded personally by the entity maintaining the register of the investment units' holders to the applicant or its representative acting on the basis of a power of attorney. On presentation of the statement by request of a notary or an authorized state body such statement shall be dispatched to location of the corresponding notary or the body specified in the request.
Any notices with reference to personal account transactions shall be issued at the application acceptance point, where the application for acquisition, redemption and exchange of the investment units has been lodged, the next business day after the income (expense) item has been entered into the register of investment units' holders.
The information from the register of investment units' holders defined by the Federal Law "On Investment Funds" shall be provided to the authorized state bodies on their request, signed by the authorized person and containing the grounds for provision of the relevant information.
V. Issue of investment units
40. The investment units are issued subject to the applications for acquisition of investment units (Annexes No. 1 and No. 2 which make integral parts hereof).
Each application for acquisition of investment units envisages the issue of investment units on each receipt of monetary Funds into the Fund.
The applications for acquisition of investment units shall be irrevocable.
41. The investment units are issued by way of making investment units' acquisition entries (income entries) into the register of investment units' holders.
42. The investment units are issued subject to deposit of monetary funds into Fund.
The monetary funds are deposited in Fund by way of monetary transfer to an account opened by Managing Company for accounting of the monetary funds that comprise the property of Fund with the acquiring bank of Fund (hereinafter referred to as Fund's account) or by way of entering the monetary funds into the cash office of Managing Company.
The monetary funds entered are included into Fund from the moment of making the income entry that Fund's investment units have been issued to the amount that corresponds with the amount of monetary funds entered.
43. The applications for acquisition of investment units shall be submitted to:
§ Managing Company;
§ Agent.
The applications for acquisition of investment units may be sent by registered mail, with advice on delivery, to the application acceptance point of Managing Company: office 322, entrance 2, 1 Bolshaya Yakimanka Str., 119180 Moscow. Authenticity of the investor's signature at the application for acquisition of investment units shall be certified by a notary.
The date and time of acceptance of the application for acquisition of investment units, received by registered mail, with advice on delivery, shall be considered the date and time of receiving the mail by Managing Company.
In case of refusal to accept the application for acquisition of investment units received by mail on the grounds stipulated herein, a well-reasoned refusal shall be dispatched by Managing Company by registered mail, with advice on delivery, to the postal address specified in the questionnaire of registered person; in case of absence of the address from the questionnaire or unavailability of the questionnaire - to the reply address specified in the mail, no later than 15 (fifteen) days on receipt of the mail by Managing Company.
44. Applications for acquisition of investment units shall be accepted each business day.
45. Refusal to accept applications for acquisition of investment units shall only be allowed subject to:
§ failed procedure and conditions of filing the applications set forth in Rules of Fund;
§ acquisition of the investment unit by a person which cannot act as the holder of investment units pursuant to the Federal Law "On Investment Funds";
§ a decision to suspend the issue of investment units.
46. Prior to completion of Fund formation the amount of issue of one investment unit shall total 1,000 (one thousand) rubles.
47. The investment units shall only be issued subject to monetary contribution of at least 1,000 (one thousand) rubles into Fund.
48. The quantity of investment units issued by Managing Company while Fund is being formed shall be determined by dividing the amount of monetary funds included in Fund by the amount of monetary funds for which one investment unit is issued in accordance with Rules of Fund.
49. If the application for acquisition of investment units has been submitted and (or) monetary funds used to pay for the investment units acquired have been contributed into Fund after it's formation is complete, the quantity of investment units issued by Managing Company shall be determined on the basis of the estimated value of the investment unit as of the date prior to the date of issuing the units (making an income entry into the register of investment units' holders), increased by the amount of markup set forth herein.
The amount of markup used to increase the estimated value of the investment unit if filing an application for acquisition of investment units, both via Managing Company and via agent totals 1 (one) percent (inclusive value-added tax) from the estimated value of the investment unit.
50. The timeframe for issue of the investment units shall not exceed 3 (three) days starting from:
§ receipt of the monetary funds contributed for inclusion into Fund onto Fund's account if the application for acquisition of investment units had been accepted prior to receipt of the monetary funds;
§ receipt of the application for acquisition of investment units if the monetary funds contributed for inclusion into Fund had been received to Fund's account prior to the acceptance of the application.
In case the monetary funds are contributed into the cash office of Managing Company the timeframe for issue of the investment units shall not exceed 3 (three) days upon acceptance of the application for acquisition of investment units.
VI. Redemption of investment units
51. The investment units shall be redeemed subject to completion of Fund formation.
52. Redemption of the investment units shall be executed based on applications for redemption of investment units (Annexes Nos. 3, 4, and 8, which are integral parts hereof).
The applications for redemption of investment units shall be irrevocable.
Applications for redemption of investment units shall be accepted each business day.
53. Applications for redemption of investment units the rights to which are recorded in the register of investment units' holders at the personal account of the nominal holder shall be submitted by the nominal holder on the basis of the corresponding errand of the investment units' holder. Such applications shall contain the investment units' holder on whose errand the nominal holder is acting.
54. The applications for redemption of investment units shall be submitted to:
§ Managing Company;
§ Agent.
55. The applications for redemption of investment units may be sent by registered mail, with advice on delivery, to the application acceptance point of Managing Company: office 322, entrance 2, 1 Bolshaya Yakimanka Str., 119180 Moscow. Authenticity of the signature of the investment units' holder at the application for redemption of investment units shall be certified by a notary.
The date and time of acceptance of the application for redemption of investment units, received by registered mail, with advice on delivery, shall be considered the date and time of receiving the mail by Managing Company.
In case of refusal to accept the application for redemption of investment units received by mail on the grounds stipulated herein, a well-reasoned refusal shall be dispatched by Managing Company by registered mail, with advice on delivery, to the postal address specified in the register of investment units' holder no later than 15 (fifteen) days on receipt of the mail by Managing Company.
56. Refusal to accept applications for redemption of investment units shall only be allowed subject to:
§ failed procedure and conditions of filing the applications set forth in Rules of Fund;
§ a decision to simultaneously suspend the issue, redemption and exchange of investment units
57. The accepted applications for redemption of investment units shall be satisfied to the extent of the investment units belonging to the investment units' holder.
58. Redemption of the investment units shall be performed by way of making the entries of redemption of investment units (entries of expense) in the register of investment units' holders.
59. The investment units shall be redeemed no later than 3 (three) days upon acceptance of the application for redemption of the investment units.
60. The amount of pecuniary compensation payable in case the investment units are redeemed shall be determined on the basis of the estimated value of the investment unit as of the date prior to the date of redeeming the investment units.
In case the application for redemption of Fund's investment units is submitted both to Managing Company and to agent, no discount used to decrease the estimated value of the investment unit shall be charged.
61. The payment of pecuniary compensation in the redemption of investment units shall be made at the expense of monetary funds included in Fund. In case the monetary funds do not suffice to pay the pecuniary compensation Managing Company is bound to sell the property included in Fund. Prior to the sale of the property included in Fund Managing Company is entitled to use its own funds or funds obtained under loan agreements or credit agreements and repayable at the expense of the property included in Fund as to redeem the investment units.
62. The payment of pecuniary compensation shall be effected by way of monetary transfer to the bank account specified in the application for redemption of the investment units or by way of payment in the cash office of Managing Company.
If no bank account used for the transfer of pecuniary compensation with relation to redemption of the investment units is specified in the application and neither receipt of the pecuniary compensation in the cash office of Managing Company is noted, the pecuniary compensation shall be transferred to the bank account specified in the register of investment units' holders.
63. The payment of pecuniary compensation shall be effected within 15 (fifteen) days upon redemption of the investment units.
64. The obligation on the payment of pecuniary compensation shall be deemed executed starting with:
§ writing down the corresponding amount of monetary funds from Fund's account while this amount is transferred to the bank account specified in the application for redemption of investment units;
§ payment thereof in cash.
VII. Exchange of investment units
65. The investment units shall be exchanged subject to completion of Fund formation.
66. Fund's investment units can be exchanged for investment units of
§ First Fund of Funds open-end mutual investment fund managed by Maxwell Asset Management LLC;
§ Maxwell Capital open-end mutual investment blend fund managed by Maxwell Asset Management LLC;
§ Maxwell Equity Fund open-end mutual investment equity fund managed by Maxwell Asset Management LLC;
§ Maxwell Telecom open-end mutual investment equity fund managed by Maxwell Asset Management LLC;
§ Maxwell State Enterprises open-end mutual investment equity fund managed by Maxwell Asset Management LLC;
§ Maxwell Oil & Gas open-end mutual investment equity fund managed by Maxwell Asset Management LLC;
§ Maxwell Energo open-end mutual investment equity fund managed by Maxwell Asset Management LLC.
67. The investment units are exchanged on the basis of applications for exchange of investment units. Sample forms of application for exchange of investment units are attached hereto (Annexes Nos. 5, 6, and 7 which are integral parts hereof).
The applications for exchange of investment units shall be irrevocable.
Applications for exchange of investment units shall be accepted each business day.
68. Applications for exchange of investment units the rights over which are recorded in the register of investment units' holders at the personal account of the nominal holder shall be submitted by the nominal holder on the basis of the corresponding errand of the investment units' holder. Such applications shall contain the investment units' holder on whose errand the nominal holder is acting.
69. The applications for exchange of investment units shall be submitted to:
§ Managing Company;
§ Agent.
70. The applications for exchange of investment units may be sent by registered mail, with advice on delivery, to the application acceptance point of Managing Company: office 322, entrance 2, 1 Bolshaya Yakimanka Str., 119180 Moscow. Authenticity of the signature of the investment unit's holder at the application for exchange of investment units shall be certified by a notary.
The date and time of acceptance of the application for exchange of investment units, received by registered mail, with advice on delivery, shall be considered the date and time of receiving the mail by Managing Company.
In case of refusal to accept the application for exchange of investment units received by mail on the grounds stipulated herein, a well-reasoned refusal shall be dispatched by Managing Company by registered mail, with advice on delivery, to the postal address specified in the register of investment units' holder no later than 15 (fifteen) days on receipt of the mail by Managing Company.
71. Refusal to accept applications for exchange of investment units shall only be allowed subject to:
§ failed procedure and conditions of filing the applications set forth in Rules of Fund;
§ a decision to simultaneously suspend the issue, redemption and exchange of investment units;
§ a decision to suspend the issue of investment units of the mutual investment fund, a demand for exchange of which is contained in the application for exchange of investment units.
72. The accepted applications for exchange of investment units shall be satisfied to the extent of the investment units belonging to the investment units' holder. The application for exchange of investment units may contain the quantity of investment units to be exchanged or contain a demand for exchange of all the investment units of Fund in the possession of the holder as of the moment the expense entry is made.
73. Expense entries related to the personal accounts of investment units' holders who have submitted the applications for exchange of investment units shall be entered into the register of investment units' holders no later than 3 (three) days upon acceptance of the application for exchange of the investment units. The amount transferred on account of exchange in investment units shall be determined on the basis of the estimated value of the investment unit as of the date prior to the date the expense entry has been made into the register of investment units' holders (but no earlier than the application for exchange of investment units is accepted).
74. From the fund the investment units of which are to be exchanged as per the application submitted, the monetary funds or other property with the value equal to the estimated value of such investment units shall be transferred into the mutual investment fund the units of which are exchanged for.
75. The income entries made during the exchange of monetary funds and (or) the value of other property transferred on account of exchange for the fund's investment units shall be made no later than 5 (five) days upon acceptance of the application for exchange of investment units. The quantity of investment units entered in the exchange shall be determined by way of dividing the amount transferred on account of exchange for the investment units by the estimated value of the investment unit of the fund for the investment units of which the exchange has been made.
The estimated value of one investment unit shall be determined by way of dividing the value of net assets calculated as of the date prior to the date of making the income entry in the register of investment units' holders by the quantity of investment units specified in the register of investment units' holders for that very day.
VIII. Suspension of issue, redemption and exchange of investment units
76. Managing Company has the right to suspend the issue of investment units. In this case Managing Company is obliged to bring this to notice of Specialized Depository, the entity maintaining the register of the investment units' holders and the agent the same day.
77. The redemption and exchange of the investment units can be suspended by Managing Company only simultaneously with the suspension of issue of the investment units.
Managing Company has the right to simultaneously suspend the issue, redemption and exchange of the investment units if:
§ the estimated value of investment units cannot be determined as a consequence of circumstances of insuperable force;
§ the rights and obligations of the entity maintaining the register of investment units' holders is being transferred to another entity.
Managing Company has the right to simultaneously suspend the issue, redemption and exchange of the investment units for the term up to 3 (three) days in case the change in the estimated value of the investment unit has been above 10 (ten) percent as compared to the estimated value for the latest determination date.
Suspension of the issue, redemption and exchange of the investment units in cases envisaged in this clause shall only be admitted in case interests of investment units' holders require so and for the term of duration of the circumstances which have caused such suspension. In case of decision on simultaneous suspension of the issue, redemption and exchange of the investment units Managing Company has to bring this to notice of the federal executive body for the securities market, Specialized Depository, the entity maintaining the register of the investment units' holders and the agent in writing the very same day.
78. Managing Company is obliged to suspend the issue, redemption and exchange of the investment units in cases when:
§ the validity of the corresponding license of Managing Company, Specialized Depository or the entity maintaining the register of investment units' holders has been suspended;
§ the corresponding license of Managing Company, Specialized Depository or the entity maintaining the register of investment units' holders has been annulled;
§ the value of Fund's assets cannot be determined for the grounds beyond control of Managing Company;
§ the corresponding demand is received from the federal executive body for the securities market;
§ in other cases stipulated in the Federal Law "On Investment Funds".
IX. Fees and expenses
79. Fees shall be paid at the expense of Fund's property to the benefit of Managing Company - in the amount of 1 (one) percent of the average annual value of Fund's net assets, determined in the manner set forth in the regulatory legal acts of the federal executive body for the securities market, per annum (inclusive the value-added tax); to the benefit of Specialized Depository, the entity maintaining the register of investment units' holders, and to Auditor - in the amount not to exceed 0.95 (zero point ninety-five) percent of the average annual value of Fund's net assets, determined in the manner set forth in the regulatory legal acts of the federal executive body for the securities market, per annum (inclusive the value-added tax).
The maximum amount of the fees specified in this clause over the fiscal year shall total 1.95 (one point ninety-five) percent of the average annual value of Fund's net assets, determined in the manner set forth in the regulatory legal acts of the federal executive body for the securities market, per annum (inclusive the value-added tax).
80. The fees to the benefit of Managing Company, Specialized Depository, the entity maintaining the register of the investment units' holders, and Auditor shall be charged daily at the expense of the property included in Fund.
81. The fee to the benefit of Managing Company shall be paid within 10 (ten) days on expiry of the month under report.
82. The fees to the benefit of Specialized Depository, the Entity maintaining the register of the investment units' holders, and Auditor shall be paid within the timeframe envisaged in the agreements between the above and Managing Company.
83. The amounts paid by Managing Company on account of its own funds as pecuniary compensation during the redemption of investment units in case the monetary funds included in Fund do not suffice shall be reimbursed at the expense of the property included in Fund.
84. The property included in Fund shall be used to reimburse the expenses related to the trust management of Fund, including those related to:
§ transactions with the property included in Fund;
§ any legal and actual activities taken to the benefit of investment units' holders (subject to the limitations envisaged in the laws of the Russian Federation, regulatory legal acts from the federal executive body for the securities market and the present Rules of Fund) with regard to the property included in Fund;
§ exercising of all rights, certified by the securities that comprise Fund, including the right to vote under voting securities;
§ exercising of Managing Company's right to bring actions and act as defendant in court lawsuits with relation to performance of Fund trust management activities, the amount of payment for legal services;
§ state duty paid by Managing company with relation to exercising of Fund trust management activities;
§ publication of the information concerning Fund, stipulated in the present Rules of Fund, regulatory legal acts of the federal executive body for the securities market or the laws of the Russian Federation;
§ servicing of Fund's settlement account;
§ notary's certification of the documents related to the performance of Fund trust management activities;
§ provision of Managing Company with information required to perform Fund trust management activities;
§ expenses associated with presentation of financial reporting into the Federal Financial Markets Service of Russia;
§ obtaining permissions from the federal authorities.
The maximum amount of expenses reimbursable at the expense of the property included in Fund totals 0.2 (zero point two) percent of the average annual value of the Fund's net assets, determined in the manner set forth in the regulatory legal acts of the federal executive body for the securities market.
85. The expenses not envisaged in Clauses 83 and 84 hereof, as well as the fees to the extent exceeding the maximum overall amount of the fees specified in Clause 79 hereof shall be paid from Managing Company's own funds.
X. Determining the estimated value of Fund's single investment unit
86. The value of the investment Fund's net assets shall be determined in the manner and within the timeframe envisaged in the regulatory legal acts of the federal executive body for the securities market.
The estimated value of one investment unit shall be determined in compliance with the regulatory legal acts of the federal executive body for the securities market as of the date of determining the value of the Fund's net assets by way of dividing this value by the quantity of investment units specified in the register of holders of the Fund's investment units as of the same date.
XI. Fund information
87. At point (points) where the applications for acquisition, redemption and exchange of investment units are accepted Managing Company and Agent shall provide the following documents at request of any person:
a) Rules of Fund and full text of the amendments and additions registered by the federal executive body for the securities market;
b) Rules of Fund as amended by the amendments and additions, registered by the federal executive body for the securities market;
c) the rules of maintaining the register of investment units' holders;
d) a reference stating the value of the property included in the Fund and the corresponding attachments to the reference;
e) a reference stating the value of Fund's net assets and the estimated value of one investment unit according to the latest assessment;
f) balance of the property included in Fund, balance sheet, profit & loss statement of Managing Company, balance sheet, profit & loss statement of Specialized Depository, and Auditor's report, as of the latest reporting date;
g) report on the increase (decrement) of the value of the property included in Fund, as of the latest reporting date;
h) data concerning the fees to the benefit of Managing Company and expenses reimbursable at the expense of the property included in Fund, as of the latest reporting date;
i) data concerning suspension and resumption of issue and redemption of investment units, including causes of suspension;
j) data concerning the agent, including its corporate name, location, phone numbers, points where applications for acquisition, redemption and exchange of investment units are accepted, including addresses, application reception hours and phone numbers at points where the applications are accepted;
k) the list of print media, news agencies, and also web address used for information related to Fund's trust management disclosure;
l) other documents containing the information, circulated or published by Managing Company in compliance with the requirements of the Federal Law "On Investment Funds", regulatory legal acts of the federal executive body for the securities market and Rules of Fund.
The information concerning application acceptance hours, suspension and resumption of the issue, redemption and exchange of the investment units, concerning the agent, the point for application acceptance, the value of net assets, the amount of one investment unit, and the amount of pecuniary compensation payable by redemption of one investment unit as of a current date, the value of net assets prior to completion of formation or prior to the date when the message is published that the value of the property has been sufficient as to regard Fund as formed, the markups and discounts, the minimum quantity of investment units being issued, the minimum amount of monetary funds being invested into Fund, termination of the Fund shall be provided by Managing Company and by Agent on the phone numbers published in the print media stipulated in Rules of Fund.
88. Prior to the start of Fund formation Managing Company has to publish Rules of Fund.
Managing Company has to publish messages on registration of amendments into Rules of Fund.
In case of termination of Fund, including in relation to the fact that on expiry of Fund's formation timeframe the value of its assets proved to be below the amount determined in Rules of Fund, Managing Company shall use its own funds to publish the information concerning repayment of monetary funds to holders of the investment units.
In case a decision on suspending or resuming the issue, redemption and exchange of investment units is made, no later than one day after such decision is passed Managing Company is obliged to issue a corresponding message at its own expense. The message on the suspension of issue, redemption and exchange of investment units shall contains the causes of such suspension.
89. The following shall be published in compliance with the regulatory legal acts of the federal executive body for the securities market:
a) information on the corporate name of Managing Company, its location, location (locations) where the applications for acquisition, redemption and exchange of investment units are accepted;
b) information on corporate name of Agent, its location, locations where the applications for acquisition, redemption and exchange of investment units are accepted;
c) balance sheet for the property included in Fund, the balance sheet, the profit & loss statement of Managing Company;
d) report on the markup (decrement) of the value of the property included in Fund;
e) data concerning the fees to the benefit of Managing Company and expenses reimbursable at the expense of the property included in Fund;
f) a reference stating the value of the property included in Fund and the corresponding attachments to the reference;
g) information concerning a decision on transfer of rights and obligations related to Fund's trust management to another managing company;
h) other documents pursuant to the Federal Law "On Investment Funds".
90. The entire information related to Fund's trust management shall be published in compliance with requirements of regulatory legal acts of the federal executive body for the securities market.
The above information is published in the "Supplement to the Herald of the Federal Financial Markets Service".
XII. Liability of Managing Company, Specialized depository and the entity maintaining the register of the investment units' holders
91. Managing Company shall be liable to the investment units' holders in the amount of actual damage in case the holders suffer losses as a result of breaching the Federal Law "On Investment Funds", other federal laws and Rules of Fund, including the incorrect determination of the amount which is to be paid for the investment unit and the amount of pecuniary compensation payable due to redemption of the investment unit.
If, as a consequence of incorrect calculation of the value of net assets the variation from the estimated value totals or exceeds 0.5 (zero point five) percent of the investment unit's estimated value, and the investment units' holder is to be paid a definite amount, it shall be paid by Managing Company at the expense of the property included in Fund.
If, as a consequence of incorrect calculation of the value of net assets the variation from the estimated value totals or exceeds 0.5 (zero point five) percent of the investment unit's estimated value and a definite amount is due on account of the property included in Fund, it shall be paid by Managing Company at its own expense.
92. Managing Company shall be responsible for actions of the depository, determined by Specialized Depository, in case such depository has been involved on Managing Company's written instruction.
93. The debts on obligations which have arisen in connection with Fund's trust management shall be repaid at the expense of the property included in Fund. In case the property included in Fund does not suffice, the execution can only be levied upon the own property of Managing Company.
94. Specialized Depository shall incur joint and several liabilities, together with Managing Company, to holders of the investment units in case of failure to perform obligations related to the control over the management of the property included in Fund.
95. Specialized Depository shall be liable for all actions of the depository it appoints as to perform its obligations on the custody and (or) registering of the securities that comprise Fund as if they were its own.
96. The entity maintaining the register of investment units' holders shall incur subsidiary liability with Managing Company to the acquirers and holders of the investment units for failures to perform or improper performance of its duties related to the maintaining of the register of investment units' holders and envisaged in the Federal Law "On Investment Funds", Rules of Fund and the agreement with Managing Company.
XIII. Termination of Fund
97. Fund shall be terminated in the case if:
§ on expiry of the timeframe for Fund formation the value of the property included in Fund is below than the amount on the achievement of which Fund is deemed to be formed;
§ the license of Managing Company has been suspended or annulled and no amendments introduced into Rules of Fund and related to the transfer of rights and obligations of such to another managing company have become valid within 3 months from the date the decision on suspension or annulment has been made;
§ a decision on voluntary winding-up of Managing Company has been passed and no amendments introduced into Rules of Fund and related to the transfer of rights and obligations of such to another managing company have become valid within 3 months from the date such decision has been made;
§ the license of Specialized Depository has been suspended or annulled and no amendments introduced into Rules of Fund and related to the transfer of rights and obligations of such to a new specialized depository have become valid within 3 months from the date the decision on suspension or annulment has been made;
§ the term of validity of Fund's trust management agreement has expired;
§ Managing Company has passed the corresponding decision;
§ other grounds stipulated in the federal laws have emerged.
98. Termination of Fund shall be executed in the procedure set forth in the Federal Law "On Investment Funds".
XIV. Rules of Fund amending
99. Amendments introduced into Rules of Fund shall become valid after being registered by the federal executive body for the securities market.
100. Investment declaration-related amendments introduced into Rules of Fund, including any changes in Fund category, increase in the fees due to Managing Company, Specialized Depository, the Entity maintaining the register of investment units' holders, and Auditor, expansion in the range and rise in the maximum amount of expenses related to Fund's trust management, the introduction or increase in the amount of discounts once the investment units are being redeemed, amendments that envisage or rue out extension of the term of validity of Fund's trust management agreement shall become valid on expiry of one month from the date a message on the registration of such has been published in the "Supplement to the Herald of the Federal Financial Markets Service".
101. All other amendments entered into Rules of Fund shall become valid from the date a message on the registration of such has been published in the "Supplement to the Herald of the Federal Financial Markets Service".
General Director
OOO "Maxwell Asset Management" P.V. Lanin [signature]
Seal: Limited liability company "Maxwell Asset Management" * Moscow
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