Prospectus
Chocolate Global Funds
Chocolate Global Funds is a Fund organised as an Umbrella Fund with segregated liabilities Sub-Funds, established in the United Arab Emirates in accordance with the Chairman of the Authority’s Board of Directors’ Decision No (01/RM) of 2023 Concerning the Regulations as to Investment Funds.
Chocolate Global Funds (the “Fund”) is a UAE Umbrella Fund which may be composed of one or several separate sub-funds (each a “Sub-Fund”), established in accordance with the Chairman of the Authority’s Board of Directors’ Decision No (01/RM) of 2023 Concerning the Regulations as to Investment Funds.
Important Information to Be Read Carefully by All Investors
UNITS ARE NOT BEING OFFERED OR SOLD IN ANY JURISDICTION WHERE THE OFFER OR SALE IS PROHIBITED BY LAW OR TO ANY PERSON WHICH IS NOT QUALIFIED FOR THAT PURPOSE.
The Fund is an umbrella fund with segregated liabilities sub-funds, established and authorised in accordance with the Chairman of the Authority’s Board of Directors’ Decision No. (01/RM) of 2023 Concerning the Regulations as to Investment Funds (the “Funds Regulations”) and listed on the official list of local funds approved by the Capital Market Authority in the United Arab Emirates (formerly known as the Securities and Commodities Authority) (the “Authority”).
This prospectus (the “Prospectus”) is a master prospectus and includes basic terms and information applicable to all Sub-Funds, as further detailed in the relevant Supplement (each, as defined herein). The information contained in this Prospectus must be read in conjunction with the Supplement relating to the relevant Sub-Fund.
The main purpose of preparing this Prospectus is to provide potential investors with the main information that will help them make their investment decisions in the offered Sub-Funds. Each investor, prior to subscription, shall carefully and accurately examine and review all the data contained in this Prospectus to decide whether or not it is appropriate to invest in a Sub-Fund. Each investor shall also obtain from their financial and legal advisor the necessary advice on investing in the Sub-Funds offered for subscription. The reader of this Prospectus shall also take into account that the words and phrases which indicate that the data is a forecast estimate of future events only and that these future estimates should not be relied upon entirely, as they are subject to change since it is impossible to predict future conditions with certainty, which may lead to actual results being different from the projected results.
Investing in the offered Sub-Funds may involve a high degree of risk. As such the investor should not invest any money in a Sub-Fund unless they can bear the loss of their investment. The terms and conditions of the Fund must also be read in full, in particular Sections 11 “General Risk Considerations” and 12 “Conflicts of Interest”, which explain the factors and risks that must be taken into consideration before making any decision to invest.
This Prospectus shall contain data submitted in accordance with the applicable issuance and disclosure rules of the Authority.
The Fund Manager, whose name is included in the contents of this Prospectus, shall be liable for the validity of the information and data contained therein and confirm to the best of its knowledge, after exerting due care and conducting extensive research, that there is no information, other facts or material information that, if not included in this Prospectus, would make any statement contained therein misleading or affecting the investment decision of the subscribers or contrary to the provisions of the resolutions issued by the Authority, and that these resolutions apply and prevail in all cases to what is contained in this Prospectus.
The information contained in this Prospectus and each Supplement is not subject to any additional information and cannot be amended without the approval of the Authority and notification to the Unitholders in accordance with the approval of the Authority.
The offering of the Fund has been presented to the Authority, for offering in the United Arab Emirates (the “UAE”). Accordingly, in the event that the Fund is offered in any other jurisdiction, the Fund Manager shall be responsible for taking all procedures and measures and obtaining the necessary approvals from the concerned authorities in those jurisdictions before offering the Sub-Fund there.
Those in charge of managing the Fund shall undertake to fully comply with all laws, regulations and resolutions in force in the UAE and those issued at any time by the Authority.
The Authority approved the offering of the Fund on 27 July 2026. The approval of the Authority shall not be an endorsement of the feasibility of the investment nor a recommendation to subscribe to the Fund’s units, but only means that this Prospectus included the minimum required information in accordance with the rules of issuance and disclosure applicable in the Authority. The Authority shall not be responsible for the accuracy, completeness, validity or adequacy of the information contained in this Prospectus and shall not be liable for any damage or loss incurred by any person as a result of reliance on this Prospectus or part thereof.
This Prospectus has been prepared in accordance with the laws, regulations, and resolutions in force in the UAE. Any violation of those laws, regulations, and resolutions that may appear herein shall be null and void, and the Fund Manager shall bear all the consequences of such violation, unless a special resolution has been issued by the Authority.
In order to take into account any material changes in the Fund (including, but not limited to the issue of new Classes of Units), this Prospectus and the Key Investor Information Document(s) will be updated as necessary. Therefore, investors should inquire as to whether there is a new version of this Prospectus and/or of the Key Investor Information Document(s).
For defined terms used in this Prospectus, if not defined herein, please refer to Section 1.2.
This Prospectus may be translated into other languages, including Arabic. In case of discrepancies between the English version and other languages, the English version shall prevail.
This Prospectus was issued on 21 August 2026.
Introduction and General Provisions
For the sake of clarity, please note that this Prospectus:
- is an invitation for the public to purchase units of the Sub-Funds;
- includes all information and data relating to the Fund, which have been assessed and reviewed by each of the Fund Manager, the Administrator, the Auditor, and the Legal Advisor (each in its own capacity) and subject to its own responsibility;
- shall be updated periodically to reflect any material change and the updated Prospectus shall be notified to the Authority, as well as to the Unitholders, if the Authority so decides;
- an updated copy of this Prospectus is available on request by an investor from the Fund Manager at the address set forth in this Prospectus; and
- is subject to the Funds Regulations and all applicable laws, regulations and resolutions in force in the UAE.
Investor Responsibility
Prospective investors should review this Prospectus and each relevant Key Investor Information Document carefully in its entirety and consult with their legal, tax and financial advisors in relation to (i) the legal requirements within their own countries for the subscription, holding, redemption or disposal of Units, (ii) any foreign exchange restrictions to which they are subject in their own countries in relation to the subscription, holding, redemption or disposal of Units, and (iii) the legal, tax, financial or other consequences of subscribing for, holding, redeeming or disposing of Units. Prospective investors should seek the advice of their legal, tax and financial advisors if they have any doubts regarding the contents of this Prospectus and each relevant Key Investor Information Document.
The Fund operates pursuant to the terms and conditions outlined in this Prospectus. Each prospective investor acknowledges acceptance of these provisions.
Units are not deposits or obligations of, or otherwise guaranteed by, any bank and are not insured by any governmental agency. The value of Units may increase or decrease. There can be no assurance that the Units will appreciate in value or that losses will not be realised. None of the repayment of capital, the payment of income, nor the performance of any investment in the Fund is guaranteed by the Fund Manager, the Investment Manager (if any), the Investment Adviser (if any), the Administrator, the Custodian, or by any affiliate or subsidiary of any of the foregoing.
The Fund draws the investors’ attention to the fact that any investor will only be able to fully exercise their investor rights directly against the Fund, if the investor is registered themselves and in their own name in the unitholders’ register. In cases where an investor invests in the Fund through an intermediary investing into the Fund in their own name but on behalf of the investor, it may not always be possible for the investor to exercise certain shareholder rights directly against the Fund. Investors are advised to take advice on their rights.
Distribution and Selling Restrictions
No persons receiving a copy of this Prospectus in any jurisdiction may treat this Prospectus as constituting an invitation to them to subscribe for Units unless in the relevant jurisdiction such an invitation could lawfully be made without compliance with any registration or other legal requirements.
It is the responsibility of any recipient of this Prospectus to confirm and observe all applicable laws and regulations. The following information is provided as a general guide only.
United Arab Emirates (including Abu Dhabi Global Market (“ADGM”) and Dubai International Financial Centre (“DIFC”))
No regulatory authority in the UAE has any responsibility for reviewing or verifying this Prospectus or any other documents in connection with the promotion of this Fund. Accordingly, no regulatory authority in the UAE has approved this Prospectus or any other associated documents, nor taken any steps to verify the information set out herein, and therefore no regulatory authority in the UAE has any responsibility for the same.
If the relevant Sub-Fund is registered with the Authority as a Passported Public Fund within the UAE:
This Passported Fund is a Public Fund and, accordingly, the Units thereof may be promoted, including by means of a public offer of the Units for public subscription, to persons in the ADGM and the DIFC.
If the relevant Sub-Fund is registered with the Authority as a Passported Private Fund within the UAE:
This Passported Fund is a Private Fund and, accordingly, the units thereof may only be promoted to Qualified Investors in the ADGM and the DIFC by means of private placement.
Gulf Cooperation Council (“GCC”) Member States
The Regulators of the GCC assume no responsibility for the correctness, comprehensiveness and adequacy of the data and information contained in the Fund’s document, and expressly disclaim that they are not responsible for any loss that may be caused to any person who may make decisions based on any information or data contained in the Fund document.
United States
Units have not been and will not be registered under the Securities Act (as amended) or the securities laws of any of the States of the United States and the Fund and Sub-Funds will not be registered under the United States Investment Company Act of 1940, as amended. Units may not be offered, sold or delivered directly or indirectly in the United States, or to or for the account or benefit of any “U.S. Person” unless it is a US tax-exempt investor which must be, among other things, an “accredited investor” and a “qualified purchaser”, as such terms are defined under applicable US Federal securities laws. Any re-offer or resale of any Units in the United States or to U.S. Persons may constitute a violation of United States law. However, the Fund and the Fund Manager reserve the right to make private placement of the Units to a limited number or category of U.S. Persons. Applicants for Units will be required to certify that they are not U.S. Persons. All Unitholders are required to notify the Fund and the Fund Manager of any change in their status as non-U.S. Person.
European Union (“EU”)
In order for the Fund Manager to be able to market the Units in the EU, the Fund Manager and the Fund are required to comply with certain transparency and disclosure requirements set forth in AIFMD, in particular, article 23 thereof, which governs required disclosure to fund investors prior to investment. Notwithstanding this requirement, since neither the Fund nor the Fund Manager, as applicable, is authorised or registered in an EU member state, or has a registered office or head office in the EU, the Fund and the Fund Manager, as applicable, are not required to comply with the following requirements set forth in article 23 of the AIFMD: (a) the Fund is not required to have a depositary, the disclosure of which would otherwise be required to be provided to investors prior to investment pursuant to article 23(1)(d) of the AIFMD; (b) the Fund Manager is not required to comply with article 9(7) of the AIFMD, which generally requires certain specific actions be taken to cover potential professional liability risks; and (c) the Fund Manager is not required to comply with article 19 of the AIFMD, which requires the disclosure of the Fund’s valuation procedure and pricing methodologies for valuing assets, including hard-to-value assets. Notwithstanding that the Fund and the Fund Manager, as the case may be, are not required to comply with the aforementioned articles, this Prospectus may nevertheless include many of the disclosures required therein.
United Kingdom
This Prospectus may only be distributed and the Units may only be offered or placed in the United Kingdom to the extent that (1) the Fund is permitted to be marketed to professional investors in the United Kingdom in accordance with Alternative Investment Fund Managers Directive (Directive (2011/61/EU) (the “AIFMD”) (as it forms part of the domestic law of the United Kingdom); or (2) this Prospectus may otherwise be lawfully distributed and the Units may otherwise be lawfully offered or placed in the UK (including at the initiative of the investor).
This Prospectus is being issued in the United Kingdom to and/or is directed only at persons who are professional investors for the purposes of the Alternative Investment Fund Managers Regulations 2013, as amended, and is accordingly exempt from the financial promotion restriction in Section 21 of the Financial Services and Markets Act 2000 (“FSMA”) in accordance with Section 29(3) of the FSMA (Financial Promotions) Order 2005. The opportunity to invest in the Fund is only available to such persons in the United Kingdom and this Prospectus must not be relied on or acted upon by any other persons in the United Kingdom.
Reliance on this Prospectus and on the Key Investor Information Document(s)
Units in any Sub-Fund described in this Prospectus as well as in the Key Investor Information Document(s) are offered only on the basis of the information contained therein and (if applicable) any addendum hereto and the latest audited annual financial report and any subsequent semi-annual financial report of the Fund.
Any further information or representations given or made by any distributor, intermediary, dealer, broker or other person should be disregarded and, accordingly, should not be relied upon. No person has been authorised to give any information or to make any representation in connection with the offering of Units other than those contained in this Prospectus, the Key Investor Information Document(s) and (if applicable) any addendum hereto and in any subsequent semi-annual or annual financial reports for the Fund and, if given or made, such information or representations must not be relied on as having been authorised by the Fund Manager, the relevant Investment Manager (if any), the relevant Sub-Investment Manager (if any), the relevant Investment Adviser (if any), the Custodian or the Administrator. Statements in this Prospectus and in the different Key Investor Information Document(s) are based on the law and practice currently in force in the UAE at the date hereof and are subject to change. Neither the delivery of this Prospectus or of the Key Investor Information Document(s) nor the issue of Units shall, under any circumstances, create any implication or constitute any representation that the affairs of the Fund have not changed since the date hereof.
Prospective investors may obtain, free of charge, on request, a copy of this Prospectus and of the Key Investor Information Document(s) relating to the Sub-Fund(s) in which they invest, the annual and semi-annual financial reports of the Fund at the registered office of the Fund Manager or the Custodian. The Key Investor Information Document will also be available on www.kelvin-dev.click.
Contents
- General Part
- The Fund
- Management and Administration
- Units
- Investment Objective, Strategy and Restrictions
- Fees and Expenses
- Determination of the Net Asset Value
- Suspension or Deferral
- Changes to the Fund, a Sub-Fund or a Class of Units
- Merger and Liquidation
- General Risk Considerations
- Conflicts of Interest
- Tax Disclosures
Sub-Fund Supplements
Chocolate Global Funds – Chocolate Global Income Fund
- Type of Sub-Fund
- Investment Strategy and Objective
- Sub-Fund Investment Restrictions
- Investment Markets of the Sub-Fund
- Investment Adviser
- Typical Investor’s Profile
- Leverage/Borrowing
- Base Currency of the Sub-Fund
- Minimum Viable Size
- Classes of Units
- Initial Offering Period
- Subscriptions
- Redemption and Conversion
- Fees
- Definitions
- Risk Factors Specific to Chocolate Finance UAE Funds – Chocolate Global Income Fund
1. General Part
1.1 Directory
Registered Office of the Fund\ Chocolate Global Funds\ Level 17, World Trade Centre, Al Danah\ Abu Dhabi, United Arab Emirates
Fund Manager\ Chocolate Finance for Managing Investments of Investment Funds - L.L.C - S.P.C\ Level 17, World Trade Centre, Al Danah\ Abu Dhabi, United Arab Emirates
Custodian\ Standard Chartered Bank (UAE Branch)\ Standard Chartered Tower\ Level 12, Emaar Square\ Downtown, P.O. Box 999\ Dubai, United Arab Emirates
Fund Administrator\ Standard Chartered Bank (UAE Branch)\ Standard Chartered Tower\ Level 12, Emaar Square\ Downtown, P.O. Box 999\ Dubai, United Arab Emirates
Registrar and Transfer Agent\ Chocolate Finance for Managing Investments of Investment Funds - L.L.C - S.P.C\ Level 17, World Trade Centre, Al Danah\ Abu Dhabi, United Arab Emirates
Auditor\ Grant Thornton Audit and Accounting Limited - Abu Dhabi\ Al Kamala Tower Office 1101, 11th Floor\ Zayed the 1st Street\ Abu Dhabi\ United Arab Emirates
Subscription Bank\ Standard Chartered Bank (UAE Branch)\ Standard Chartered Tower\ Level 12, Emaar Square\ Downtown, P.O. Box 999\ Dubai, United Arab Emirates
Legal Counsel\ Simmons & Simmons Middle East LLP\ ICD Brookfield Place, 17th Floor\ Dubai International Financial Centre\ Dubai, United Arab Emirates
Global Distributor\ Chocolate Finance for Managing Investments of Investment Funds - L.L.C - S.P.C\ Level 17, World Trade Centre, Al Danah\ Abu Dhabi, United Arab Emirates
1.2 Definitions
(A) References in this Prospectus to the singular will include the plural and vice versa.
(B) References in this Prospectus to the Fund Manager, any Investment Manager, Sub-Investment Manager or Investment Adviser will include their respective successors and assignees.
(C) References in this Prospectus to “persons” will include natural persons, corporate bodies, unincorporated associations, and any other juridical persons, entities or bodies.
(D) References in this Prospectus to periods of time will be construed in accordance with the Gregorian calendar except where otherwise stated.
(E) For the purposes of this Prospectus, the following expressions have the following meanings:
“AAOIFI” means the Accounting and Auditing Organization for Islamic Financial Institutions.
“Accumulating Class” means a Class of Units where income received is not distributed to Unitholders in that Class but, at the election of the Fund Manager, will either be reinvested in additional Units in such Class, or accumulated and increase the Net Asset Value of such Accumulating Class.
“Administration Agreement” means the fund administration services agreement between, among others, the Fund, represented by the Fund Manager, and the Administrator as amended, supplemented or novated from time to time pursuant to which the Administrator has been appointed to act as the fund administrator.
“Administrator” means Standard Chartered Bank (UAE Branch) or such other entity appointed as fund administrator from time to time.
“Administrator Fee” has the meaning ascribed to such term under Section 6.6.
“AED” or “Dirham” means the United Arab Emirates Dirham.
“Annual Report” means each annual report of the Fund.
“Application Form” shall have the meaning described in Section 4.2(D).
“Assets” shall have the meaning described in Section 7.2.
“Auditor” means Grant Thornton Audit and Accounting Limited - Abu Dhabi or such other entity appointed as auditor from time to time.
“Authority” means the UAE financial regulatory authority, the Capital Market Authority (formerly known as the Securities and Commodities Authority).
“Base Currency” means the currency of a Sub-Fund, which shall be USD unless otherwise indicated in a Sub-Fund Supplement.
“Business Day” means any day on which banks are normally open for business in the United Kingdom, the United Arab Emirates and the United States, unless otherwise indicated in a Sub-Fund Supplement.
“Chocolate Group” has the meaning ascribed to such term under Section 3.6(B).
“Class” or “Class of Units” means a class of Units of a Sub-Fund as described in this Prospectus.
“Closed-ended” means a Sub-Fund with fixed capital whose units are redeemed only on its expiry, unless the Authority approves an increase of its capital by new subscriptions or reduction of its capital by the existing units redeemed.
“Commitment” means, in respect of a commitment-based Sub-Fund, the aggregate amount committed by an investor and accepted by the Fund Manager or its agent (whether or not such amount has been contributed in whole or in part), as such amount may be amended from time to time.
“Companies Law” means the Federal Decree Law No. (32) of 2021 on Commercial Companies.
“Conversion Day” means the Dealing Day on which an application to convert Units may be received via the Digital Platform as set out for each Sub-Fund in the relevant Sub-Fund Supplement.
“Conversion Fee” has the meaning ascribed to such term under Section 4.6.
“Counterparty” means an investor fulfilling the terms and conditions referred to in section three, second chapter, article (6) of the Financial Rulebook, as may be amended from time to time.
“CRS” means the Common Reporting Standard issued by the Organisation for Economic Cooperation and Development, and any legislation, regulations and official guidance relating to the implementation of the foregoing, together with any similar legislation, regulations or guidance enacted in any jurisdiction which seeks to implement equivalent tax reporting and/or withholding tax regimes (other than FATCA).
“Custodian” means Standard Chartered Bank (UAE Branch), or such other entity appointed as custodian in respect of the Fund by the Fund Manager from time to time.
“Custody Agreement” means the agreement between, among others, the Fund, represented by the Fund Manager, and the Custodian pursuant to which the Fund Manager has appointed the Custodian to provide custody services in respect of the Fund, as amended, supplemented or novated from time to time.
“Custodian Fee” has the meaning ascribed to such term under Section 6.5.
“Cut-Off Time” means, with respect to each Dealing Day, the deadline before which applications for subscription, redemption or conversion of Units of any Class must be received on the Digital Platform in order to be dealt with on that Dealing Day, as further described in the relevant Sub-Fund Supplement.
“Dealing Day” means each day when a subscription request, a redemption request and/or a conversion request is processed as further described in the relevant Sub-Fund Supplement.
“Digital Platform” means the online digital platform/mobile application provided by the Fund Manager to be used by the investors for subscriptions, redemptions, conversions, and more generally in respect of their investment into the Fund and for communications.
“Distributing Class” means a Class of Units where distributions available in that Class are neither reinvested in additional Units in such Class nor accumulated and increasing the Net Asset Value of such Class, and may be distributed to the Unitholders of that Class.
“Distributor” has the meaning ascribed to such term under Section 3.4.
“FATCA” means the United States Foreign Account Tax Compliance Act provisions contained in sections 1471 to 1474 of the United States Internal Revenue Code of 1986 (as amended), any regulations promulgated thereunder or administrative interpretations thereof, any intergovernmental agreement relating to the foregoing and any legislation, regulations or official guidance relating to the implementation of any of the foregoing.
“Feeder Fund” has the meaning given to such term in the Funds Regulations.
“Fees” means the fees payable pursuant to Section 6 herein.
“Financial Rulebook” means the Chairman of the Authority’s Board of Directors’ Decision No. (13/Chairman) of 2021 on the Regulations Manual of the Financial Activities and Status Regularization Mechanisms Rule Book, as may be amended from time to time.
“Fund” means Chocolate Global Funds.
“Fund Manager” means Chocolate Finance for Managing Investments of Investment Funds - L.L.C - S.P.C, acting in its capacity as fund manager of the Fund.
“Fund Management Agreement” means the fund management agreement entered into between the Fund Manager and the Fund as amended, supplemented or novated from time to time, pursuant to which the Fund Manager acts as fund manager of the Fund.
“Funds Regulations” means the Chairman of the Authority’s Board of Directors Decision No. (01/RM) of 2023 concerning the Regulation as to Investment Funds, as may be amended from time to time.
General Meeting of Unitholders” means in respect of Unitholders of a Class, a Sub-Fund or the Fund, as relevant, a general meeting convened and voting in accordance with Section 9
“Global Distributor” means Chocolate Finance for Managing Investments of Investment Funds - L.L.C - S.P.C, acting in its capacity as global distributor of the Fund and its Sub-Funds.
“Important Changes” means any change affecting the Fund’s or, to the extent relevant, a Sub-Fund’s assets or liabilities, including the following:
(A) a change that would make the Unitholders reconsider their subscription to the Fund;
(B) a change resulting in increasing the types of the Fund’s or Sub-Fund’s payments made by the Fund’s or Sub-Fund’s assets, as relevant, to the Fund Manager;
(C) a reduction or increase of the capital of a closed-ended Sub-Fund; and
(D) any other cases specified by the Authority from time to time.
“Initial Offering Period” means the initial period of time during which Units of any Class in a Sub-Fund are issued at the Initial Offer Price, as further described in the relevant Sub-Fund Supplement.
“Initial Offer Price” means the price at which the Units of any Class in a Sub-Fund are offered during the Initial Offering Period as specified in the relevant Sub-Fund Supplement.
“Initial Subscription Day” means the initial subscription day during which the Units of any Class in a Sub-Fund may be issued at the Initial Offer Price, as further described in the relevant Sub-Fund Supplement.
“Investment Adviser” means any entity appointed as investment adviser in respect of a Sub-Fund, as further described in the relevant Sub-Fund Supplement.
“Investment Advisory Agreement” means the agreement pursuant to which an Investment Adviser has been appointed to provide investment advisory services in respect of certain Sub-Fund(s).
“Investment Advisory Fee” means the investment advisory fee payable to the Investment Adviser in respect of a Sub-Fund by the Fund Manager or the Investment Manager, as relevant, as further described in the relevant Sub-Fund Supplement.
“Investment Manager” means any entity appointed as delegated investment manager in respect of a Sub-Fund, as further described in the relevant Sub-Fund Supplement.
“Investment Management Agreement” means the agreement entered into between, among others, the Fund Manager and an Investment Manager, as amended, supplemented or novated from time to time, pursuant to which the Investment Manager will provide investment management services to the relevant Sub-Fund(s).
“Investment Management Fee” means the investment management fee payable to the Investment Manager in respect of a Sub-Fund according to the Investment Management Agreement, as further described in the relevant Sub-Fund Supplement.
“Key Investor Information Document” or “KIID” means the Key Investor Information Document issued for each Sub-Fund and/or each Class of Units.
“Management Fee” means the management fee payable by each Sub-Fund to the Fund Manager according to the Fund Management Agreement, as further described in the relevant Sub-Fund Supplement.
“Material Changes” means any change affecting the Fund’s or, to the extent relevant, a Sub-Fund’s assets, obligations or performance, including:
(A) a change in the investment objective or the nature of the Fund or the Sub-Fund;
(B) mergers;
(C) a change having an effect of ten percent (10%) or more on the Fund’s or Sub-Fund’s Net Asset Value;
(D) a change having a negative effect impacting ten percent (10%) or more of the Units of the Fund or a Sub-Fund;
(E) conflicts of interest cases which amount to ten percent (10%) or more of the Net Asset Value or a Sub-Fund, or which affects five percent (5%) or more of the total revenues of the Fund or a Sub-Fund;
(F) changes and replacement of the Fund Manager;
(G) changes to the term of the Fund; or
(H) any other cases specified by the Authority.
“Minimum Viable Size” has the meaning ascribed to such term under Section 2.2.
“Money Market Instruments” means instruments normally dealt in on the money market which are liquid, and have a value which can be accurately determined at any time.
“Net Asset Value” means the net asset value of each Class or Sub-Fund, as relevant.
“Net Asset Value per Unit” means the Net Asset Value of a Class divided by the number of Units of that Class in issue or deemed to be in issue.
“Notifiable Change” any change that does not fall within the scope of Material Changes or Important Changes.
“Open-ended” means a Sub-Fund having a variable capital that increases according to the new issued units and decreases by the redemption of existing units.
“Operating Expenses” has the meaning ascribed to such term under Section 6.1.
“Operating Expenses Cap” has the meaning ascribed to such term in the relevant Sub-Fund Supplement.
“Ordinary Resolution” means a decision issued by a majority of the Units represented at a general meeting of the Unitholders.
“Performance Fee” means the performance fee payable by a Sub-Fund to the Fund Manager as further described in the relevant Sub-Fund Supplement.
“Pricing Currency” means the currency in which the Net Asset Value of a Class of Units in a Sub-Fund is calculated and expressed.
“Private Fund” means an (Open-ended or Closed-ended) Sub-Fund offered for subscription to Professional Investors or Counterparty.
“Professional Investor” means an investor fulfilling the terms and conditions referred to in section three, second chapter, article (5) of the Financial Rulebook, as may be amended from time to time.
“Prospectus” means the prospectus of the Fund.
“Public Fund” means an (Open-ended or Closed-ended) Sub-Fund offered for subscription to Retail Investors.
“Redemption Day” means the Dealing Day on which an application to redeem Units may be received via the Digital Platform as set out for each Sub-Fund in the relevant Sub-Fund Supplement.
“Redemption Fee” has the meaning ascribed to such term under Section 4.4(C).
“Redemption Price” means in respect of any Unit of any Class, an amount calculated by dividing the Net Asset Value of the relevant Class as at the relevant Redemption Day by the number of Units of such Class in issue on such Redemption Day, rounded down to the relevant number of decimal places as set out in Section 4.1 (Unit Characteristics), less any applicable fiscal and fee charges.
“Reference Currency” means the currency of the Fund.
“Related Party” means the “Parties Related to the Local Fund” as defined in the Funds Regulations, including any of the following persons:
(a) the service providers of the Fund, which include a person providing services to the Fund such as the Fund Manager, the Administrator, the Custodian, the Auditor, the legal adviser and any other person associated with the Fund according to its nature and investment strategy;
(b) the chairman and members of the board of directors, the senior management of any of the service providers of the Fund, the outsourced party, and their respective spouses and minor sons;
(c) the lenders to the Fund;
(d) any direct or indirect holder or beneficial owner of Units representing five percent (5%) or more of any of the Unit categories/Classes;
(e) any person who controls any of the above persons;
(f) any person who is controlled by any of the above mentioned persons;
(g) any person who is established to have a direct or indirect agreement or arrangement on the Fund;
(h) any person who was one of the Related Parties to the Fund during the six (6) months preceding completion of the transaction or deal related to the Fund or the relevant Sub-Fund;
(i) any person who knows that they will be a Related Party within the six (6) months following concluding the transaction or deal related to the Fund or the relevant Sub-Fund; or
(j) any other person who is classified as a party related to the Fund pursuant to any regulations issued by the Authority in this respect.
“Related Party Transaction” means, to the extent applicable in accordance with the Funds Regulations, a transaction in respect of the Fund or a Sub-Fund with a Related Party or with any other party who dealt with the Related Party in the same deal or part thereof or in any transaction associated with that deal within the two (2) preceding years.
“Relevant Entity” has the meaning ascribed to such term in Section 11.1 item 30.
“Restricted Person” means a U.S. Person or any other person subject to constraints upon subscription or redemption in/from the Fund as a result of applicable laws and regulations imposed by the UAE, the person’s state of nationality or domicile or any other factor which may be determined by the Fund Manager in its sole discretion.
“Retail Investor” means an investor fulfilling the terms and conditions referred to in section three, second chapter, article (4) of the Financial Rulebook, as may be amended from time to time.
“Securities Act” means the U.S. Securities Act of 1933, as amended.
“Settlement Date” has the meaning ascribed to such term under Section 4.2(F)(1)(b).
“Shariah Advisor” means any Shariah advisor appointed in respect of one or more Shariah compliant Sub-Funds to provide advice in respect of compliance with the principles of Islamic Shariah, as further described in the relevant Sub-Fund Supplement.
“Shariah Supervisory Committee” means the Shariah supervisory committee in respect of one or more Shariah compliant Sub-Funds, as further described in the relevant Sub-Fund Supplement.
“Special Resolution” means a resolution issued by Unitholders representing a majority of not less than three fourths of the Units represented at the general meeting of the Unitholders.
“Special Redemption Request” means a redemption request submitted in respect of an eligible Class of Units that does not exceed the applicable maximum daily threshold determined by the Fund Manager from time to time, described in the relevant Sub-Fund Supplement. A Special Redemption Request will be processed at the Redemption Price applicable to the prior Redemption Day and will be settled on the same day.
“Sub-Fund” means a specific pool of assets and liabilities established within the Fund, within the meaning of Part Third “Umbrella Fund and Sub-Fund” of Appendix 3 of the Funds Regulations.
“Sub-Fund Supplement” means, in respect of each Sub-Fund, the supplement to this Prospectus detailing such Sub-Fund’s specific terms and conditions.
“Sub-Investment Manager” means any entity appointed as sub-investment manager in respect of a Sub-Fund, as further described in the relevant Sub-Fund Supplement.
“Subscription Day” means the Dealing Day on which an application to subscribe for Units may be received via the Digital Platform as set out in the relevant Sub-Fund Supplement.
“Subscription Fee” has the meaning ascribed to such term under Section 4.2(B).
“Subscription Price” means the price per Unit (i) during the Initial Offering Period (i.e., the Initial Offer Price), and (ii) after the Initial Offering Period as described in the relevant Sub-Fund Supplement.
“Total Net Asset Value” means the total Net Asset Value of the Sub-Fund or the Unit Class of the Sub-Fund (if any).
“Transferable Securities” means:
(A) shares and other securities equivalent to shares;
(B) bonds and other debt instruments (debt securities);
(C) any other negotiable securities which carry the right to acquire any such transferable securities by subscription or exchange,
excluding techniques and instruments relating to Transferable Securities and Money Market Instruments.
“UAE” means the Federal State of the United Arab Emirates.
“UCITS” means an undertaking for collective investment in transferable securities and other eligible assets authorised pursuant to Directive 2009/65/EC of European Parliament and of the Council, as amended.
“Unitholder(s)” means holder(s) of Units in a Sub-Fund of the Fund, as recorded in the books of the Fund.
“Units” means units of any Class within any Sub-Fund in the Fund.
“United States”, “U.S.” or “USA” means the United States of America, its territories or possessions or any area subject to its jurisdiction including the Commonwealth of Puerto Rico.
“U.S. Dollar” or “USD” means the lawful currency of the United States.
“U.S. Person” means any person which would fall within the scope of FATCA, including:
(A) a natural person who is a resident of the United States;
(B) a corporation, partnership or other entity, other than an entity organised principally for passive investment, organised under the laws of the United States and which has its principal place of business in the United States;
(C) an estate or trust, the income of which is subject to United States income tax regardless of the source;
(D) a pension plan for the employees, officers or principals of an entity organised and with its principal place of business in the United States;
(E) an entity organised principally for passive investment such as a pool, investment company or other similar entity; provided, that units of participation in the entity held by persons who qualify as U.S. persons or otherwise as qualified eligible persons represent in the aggregate 10% or more of the beneficial interests in the entity, and that such entity was formed principally for the purpose of investment by such persons in a commodity pool the operator of which is exempt from certain requirements of Part 4 of the U.S. Commodity Futures Trading Commission's regulations by virtue of its participants being non-U.S. Persons; or
(F) any other “U.S. Person” as such term may be defined in Regulation S under the U.S. Securities Act of 1933, as amended, or in regulations adopted under the U.S. Commodity Exchange Act of 1922, as amended.
“Valuation Day” means each day for which the Net Asset Value is calculated as further described in the relevant Sub-Fund Supplement.
“Valuation Point” means the time on the relevant Valuation Day by which the Net Asset Value of the Classes of Units is calculated as may be further described in the relevant Sub-Fund Supplement.
“VAT” means (i) in relation to the UAE, value added tax imposed by Federal Decree Law No. 8 of 2017 and legislation and regulations supplemental thereto; and (ii) any other tax of a similar nature, whether imposed in the UAE in substitution for, or levied in addition to, such tax referred to in (i), or imposed elsewhere.
2. The Fund
2.1 Introduction
The Fund is organised as an ‘umbrella fund’, which does not have a separate legal entity. The Fund is composed of one or more Sub-Funds, as set forth under the Sub-Fund Supplements. Each Sub-Fund constitutes a single legal entity and is treated as a separate entity in relation to each other Sub-Fund. Each Sub-Fund has a separate portfolio of assets. Units in any particular Sub-Fund will be further divided into different classes (each a “Class” and together the “Classes”) to accommodate different subscription, conversion and redemption provisions and/or fees and charges to which they are subject, as well as their availability to certain types of investors. All references to a Sub-Fund, shall, where the context requires, include any Class of Units that belongs to such Sub-Fund.
The Assets of each Sub-Fund secure the rights of Unitholders in the Sub-Fund and shall not be pledged, seized, or disposed of in fulfilment of any entitlements or indebtedness relating to any other party. Unitholders and their heirs or creditors may not demand to control the Assets of the Fund or any Sub-Fund in any way.
In order to protect present and future assets and liabilities against the fluctuation of the relevant market, the Fund Manager or the Investment Manager, as relevant in each Sub-Fund, may purchase financial derivative instruments in order to hedge the exchange risks of the Classes of Units which are not denominated in the Base Currency and for other authorised purposes.
The objective of the transactions referred to above presupposes the existence of a direct relationship between the contemplated transactions and the assets or liabilities to be hedged and implies that in principle transactions may not exceed the net asset value of such assets and liabilities.
The Fund has the possibility to create further Sub-Funds and further Classes of Units within each Sub-Fund. This Prospectus shall be amended accordingly and Key Investor Information Documents relating to the new Sub-Funds issued, in order to provide all the necessary information on such new Sub-Funds and Classes of Units.
For further information on the Classes of Units, investors should refer to Section 4 and Section 4.1(A) and to each Sub-Fund Supplement detailing the available Classes for each Sub-Fund as well as their characteristics.
2.2 General information
The Fund has been established on 1st September 2026 for an unlimited period of time as an ‘umbrella fund’.
Each Sub-Fund may qualify as either a Public Fund or a Private Fund, as specified for each Sub-Fund in its Sub-Fund Supplement.
Each Sub-Fund may have a minimum viable size (the “Minimum Viable Size”), as further described in the relevant Sub-Fund Supplement, to be reached during the Initial Offering Period. If a Sub-Fund does not reach the Minimum Viable Size during the Initial Offering Period, or falls below the Minimum Viable Size at any time, the Fund Manager may redeem all Units on issue in the relevant Sub-Fund and proceed with the liquidation of the relevant Sub-Fund.
The capital of the Fund is represented by fully paid-up Units of no par value. The capital of the Fund is at all times equal to the total net assets of all Sub-Funds.
Legal Status of the Fund and the Sub-Funds
Under UAE law, the Fund is not a distinct legal entity.
However, each Sub-Fund will acquire legal personality and an independent financial capacity by virtue of the Authority’s decision to license it. Each Sub-Fund shall have a legal personality, to the extent necessary according to the provisions of the Funds Regulations, during the term of its licence.
The Assets of each Sub-Fund shall guarantee the rights of the Unitholders and may not be mortgaged or lent to third parties or seized or disposed of in fulfilment of any dues or debts related to any other entities.
Unitholders, their heirs and their creditors may not request to allocate, retain or control any of the relevant Sub-Fund’s assets in any way or obtain any other right over the same.
Each Sub-Fund shall be liable only for the obligations arising from the exercise of its activities, and the Unitholders shall not be liable for the obligations of the relevant Sub-Fund except within the limits of their investments.
The Fund shall pay all expenses incurred by the Fund Manager to license each Sub-Fund. All legal consequences arising out of the acts made by the Fund Manager on its behalf shall inure to the relevant Sub-Fund in the course of licensing procedures.
Unless otherwise indicated in a Sub-Fund Supplement, the Sub-Funds’ accounting year begins on May 1st and ends on April 30th of each year. The first financial year of any Sub-Fund starts with their respective licensing date and ends on the last day of their respective accounting year, save where such period would last less than six (6) months in which case the first financial year will be extended to end on the last day of the subsequent accounting year. The Fund Manager publishes annually audited financial statements and semi-annually reviewed financial statements of the Sub-Funds in accordance with the conditions and requirements set forth in the Funds Regulations. The semi-annual financial reports will be reviewed within a period of no longer than forty-five (45) days from the end of the semi-annual period of the relevant Sub-Fund, and the annual financial reports should be audited within a period of no longer than three (3) months from the end of the relevant Sub-Fund’s financial year. Financial statements will be prepared in accordance with the International Financial Reporting Standards (IFRS).
General meetings of Unitholders of any Sub-Fund or any Class of Units may be held at such time and place as indicated in the convening notice. Notices of such meetings shall be provided to the Unitholders in accordance with Section 9 (Changes to the Fund, a Sub-Fund or a Class of Units) of this Prospectus and the Funds Regulations.
Participation in the Fund is intended for passive investment purposes only. The Sub-Fund purchasing of Units will not grant Unitholders the rights given to shareholders of commercial companies. The ownership of Units will not, therefore, confer upon Unitholders any ownership, voting or control rights in the Sub-Funds or their Assets, except as expressly set forth in this Prospectus or in the Funds Regulations.
2.3 Umbrella Fund Structure
The Fund is an ‘umbrella fund’ with segregated liability between Sub-Funds to the largest extent permitted under the Funds Regulations and the laws of the UAE. Any liability incurred in respect of any Sub-Fund shall be discharged solely out of the assets of that Sub-Fund. In accordance with the Funds Regulations and subject to the prior approval of the Authority, the Fund Manager may establish additional Sub-Funds whose terms and conditions may differ.
2.4 Rights of Unitholders
Subscribing for Units in a Sub-Fund shall not give Unitholders any voting or other rights with respect to such Sub-Fund, including the right to receive dividends or any other allocations from the Sub-Fund or the underlying Assets of the Sub-Fund, except as otherwise provided in this Prospectus or the Funds Regulations.
A Unitholder in any Sub-Fund shall only be liable for the obligations of the Sub-Fund within the limits of their holdings in the Sub-Fund in which they invested.
2.5 Documents Available
Any investor may obtain a copy of any of the following documents at the registered office of the Fund Manager, as well as on www.kelvin-dev.click:
- the Prospectus;
- the KIIDs;
- the most recent annual and semi-annual financial statements of the Sub-Funds.
2.6 Governing Law
This Prospectus and the terms and conditions contained herein, including all Sub-Fund Supplements, shall be governed by, and construed in accordance with, the laws of the UAE. Each investor irrevocably submits to the exclusive jurisdiction of the courts of the UAE in respect of these matters, which does not prevent an action being taken against an investor in any other jurisdiction.
3. Management and Administration
3.1 Fund Manager
Chocolate Finance for Managing Investments of Investment Funds - L.L.C - S.P.C is acting as Fund Manager of the Fund in accordance with the Funds Regulations.
The Fund Manager will control the affairs of the Fund and will be responsible on a day-to-day basis for providing investment management services in respect of all the Sub-Funds. The Fund Manager may delegate part or all of its functions to third parties, subject to the approval of the Authority.
The liability of the Fund Manager shall not be affected by the fact that it has delegated functions and duties to third parties.
The Fund Manager has its registered office at Level 17, World Trade Centre, Al Danah, Abu Dhabi, United Arab Emirates, with company number 5711927.
The capital of the Fund Manager amounts to AED 5,000,000.
As of the date of this Prospectus, the manager of the Fund Manager (the “Company Manager”) is James Shanahan.
The shareholders of the Fund Manager have delegated to James Shanahan, the Company Manager and Chief Executive Officer, all its powers and functions in relation to the management of the Fund Manager. The Company Manager shall have plenary powers on behalf of the Fund Manager and shall cause and undertake all such actions and provisions which are necessary in pursuit of the Fund’s objective. The Company Manager has further delegated to Benjamin Tan, Chief Investment Officer and Investment Manager, all the powers and functions in relation to the management of the Fund and the Sub-Funds.
The Fund Manager shall at all times act in the best interests of the Unitholders and according to the provisions set forth by the Funds Regulations and the Prospectus.
In addition to the Fund, the Fund Manager may also manage other investment funds.
The Fund Management Agreement has been entered into for an indefinite period of time and shall terminate upon the dissolution of the Fund unless terminated earlier in accordance with the terms of the Fund Management Agreement.
The Fund Manager may receive a Management Fee in respect of each Sub-Fund as set forth in the relevant Sub-Fund Supplement.
3.2 Investment Manager
The Fund Manager may delegate the investment management function in respect of certain Sub-Funds to an Investment Manager, as further described in the relevant Sub-Fund Supplement, subject to the prior approval of the Authority.
The Sub-Funds’ investment policy will be determined by the Fund Manager. In case of delegation, the Investment Manager has responsibility for managing the investments of the relevant Sub-Fund on a day-to-day basis, subject to the overall review and control of the Fund Manager.
The Investment Manager is entitled to delegate any of its functions in relation to certain Sub-Funds to sub-investment manager(s) (each, a “Sub-Investment Manager”), in order to benefit from their expertise and experience in particular markets. The delegation by the Investment Manager to a Sub-Investment Manager shall be under its responsibility with prior approval of the Fund Manager and the Authority. In such case, the Prospectus shall be updated accordingly. Unless otherwise indicated in a Sub-Fund Supplement, the remuneration of any such Sub-Investment Manager is at the expense of the Investment Manager.
The Investment Manager may receive an Investment Management Fee in respect of each Sub-Fund as set forth in the relevant Sub-Fund Supplement.
3.3 Investment Adviser
The Investment Manager or the Fund Manager, as relevant, in respect of a Sub-Fund, may appoint one or more Investment Adviser(s), as disclosed in the relevant Sub-Fund Supplement under their own responsibility and as a service introduced to support the efficient performance of their duties. Any related fees or expenses incurred for this purpose will be borne by the Investment Manager or the Fund Manager, and the relevant Sub-Fund will not bear any such fees or expenses.
The Investment Adviser is not vested with the power to make investments. Its services will include, but are not limited to, the following: identifying, analysing and structuring of new investments, preparation of and assistance to negotiating investments and the financing thereof, and assistance to the acquisition and disposition of investments.
The Investment Adviser may, upon prior approval of the Fund Manager and/or the Investment Manager, as relevant, delegate at its own cost, the performance of all or part of its investment advisory services in relation to any Sub-Fund to one or more sub-investment advisers in order to benefit from their expertise and experience in particular markets, pursuant to the relevant sub-investment advisory agreements.
The Investment Adviser may receive an Investment Advisory Fee in respect of each Sub-Fund as set forth in the relevant Sub-Fund Supplement.
3.4 Distributors
The Fund Manager will act as Global Distributor of the Fund and its Sub-Funds. The Fund Manager, in its capacity as Global Distributor, may appoint distributors under its own responsibility and as a service introduced to support the promotion, subscription, redemption and/or transfer of Units of the Sub-Funds in various markets and jurisdictions (the “Distributors”). Any related fees or expenses incurred for this purpose will be borne by the Fund Manager and the relevant Sub-Fund will not bear any such fees or expenses.
3.5 Custodian
The Custodian has been appointed by the Fund Manager (acting on behalf of the Fund) as custodian to the Sub-Funds and will hold certain of the Sub-Funds’ Assets in custody. The Custodian provides custody services to the Sub-Funds pursuant to the terms and conditions of the Custody Agreement. The Custodian is authorised and regulated by the Authority for the conduct of its custody business in the UAE.
The safekeeping of the Sub-Funds’ Assets is a core responsibility of the Custodian. Under the Custody Agreement, the Custodian may appoint such sub-custodians, agents, and delegates, as it thinks fit, and may delegate its duties, obligations and powers to such parties. The Custodian must exercise reasonable care and appropriate diligence in the selection and monitoring of these parties, maintain what the Custodian considers an appropriate level of supervision over these parties, and make appropriate periodic inquiries to confirm that these parties are competently discharging their obligations.
The Custodian is responsible to the relevant Sub-Fund for the loss of any of the Sub-Funds’ Assets held in custody by the Custodian or by any sub-custodian, agent, nominee or other delegate appointed by the Custodian, including any such loss of those Assets that arises from, or comes to light on, the act, omission, default, fraud or insolvency of any such party. This responsibility is confined to the loss of the Sub-Funds’ Assets and does not extend to any other loss arising from the insolvency of a sub-custodian, agent, nominee or other delegate.
The Sub-Funds’ Assets held in custody are recorded as belonging to the Fund and the relevant Sub-Fund, are held separately from the assets of the Custodian and of each sub-custodian, and are intended not to form part of the insolvency estate of the Custodian or of any sub-custodian. Where any such loss occurs, the Custodian will use all reasonable endeavours to recover any such property for the account of the relevant Sub-Fund.
The Custodian’s obligations and liabilities are only to the Fund and the Sub-Funds and subject to applicable laws and regulations, and subject to any prior approval from the Authority as may be required. Additionally, (i) the Custody Agreement may be terminated, subject to the prior approval of the Authority, at any time by either party upon not less than ninety (90) days’ prior written notice, (ii) the Custodian shall not be liable to the Sub-Fund, any investor or any other person unless, it has been negligent, has willfully defaulted or committed a fraud, has materially breached the Custody Agreement, or has breached applicable laws and regulations, (iii) the Sub-Funds fully indemnify, the Custodian, its affiliates, sub-custodians on demand against any losses claims expenses of any kind (including legal and professional expenses), actions or proceedings of any nature which may be incurred by the Custodian arising out of or in connection with the services provided by the Custodian, any agent, sub-custodian, affiliate, or delegate of the Custodian (other than those resulting from, the fraud, negligence or willful misconduct, any breach of the Custody Agreement, or breach of applicable laws and regulations, on the part of the Custodian, agent, sub-custodian, affiliate).
Subject to applicable laws and regulations, the Custodian has no fiduciary responsibility to either the Fund or the investors. The Custodian does not provide any investment management or advisory services to the Sub-Funds and, therefore, is not in any way responsible for the Sub-Funds’ performance or the repayment of capital to the Sub-Funds’ Investors, the monitoring of the Sub-Funds’ investments or the Sub-Funds’ compliance with their investment objectives or restrictions, borrowing restrictions or operating guidelines. Except for the sections relating to its services, the Custodian was not involved in preparing, and accepts no responsibility for any information contained in, this Prospectus. None of the Custodian or their employees or agents are directly involved in the business affairs, organization, sponsorship or management of the Fund. The Custodian will not participate in transactions or activities or make any payments denominated in US dollars, which if carried out by a US person, would be subject to sanctions of the Office of Foreign Assets Control.
3.6 Fund Administrator, Registrar and Transfer Agent
(A) Fund Administrator
The Administrator has been appointed by the Fund Manager as fund administrator to the Sub-Funds pursuant to the terms of the Administration Agreement.
Under the supervision of the Fund Manager, the Administrator will be responsible for providing certain fund administration services to the Sub-Funds in accordance with the provisions of the Administration Agreement. These include the calculation of the Net Asset Value of the Sub-Funds and the Net Asset Value per Unit.
In calculating the Net Asset Value of a Sub-Fund and each Unit, the Administrator shall use prices ascribed to the Sub-Fund’s underlying assets that the Administrator has, in its capacity as fund administrator, collected or received from (a) an independent financial market data provider available to and used by the Administrator in its capacity as a fund administrator or (b) the Sub-Fund, the Fund Manager, the Investment Manager or other agents/parties appointed or nominated by the Fund or the Fund Manager ((a) and (b) together the “Pricing Sources”). Where a price for an underlying asset is available from more than one Pricing Source, the Administrator may, if so directed by the Fund or the Fund Manager, compare the various prices it has collected or received with respect to the same underlying asset (a “Price Comparison”) and if directed or requested by the Fund or the Fund Manager, report such Price Comparison to the Fund Manager. With the exception of performing and reporting Price Comparisons, and subject to applicable laws and regulations, the Administrator is not responsible or liable for: (a) verifying any price ascribed by the Pricing Sources to any of the Sub-Fund’s underlying assets, including any illiquid and/or hard-to-value assets; or (b) the accuracy, correctness, completeness, reliability or current state of any price ascribed by a Pricing Source to any of the Sub-Fund’s underlying assets.
The Administrator’s obligations and liabilities are only to the Fund Manager, the Fund and the Sub-Funds, and only as provided in the Administration Agreement. In accordance with and subject to the terms of the Administration Agreement (i) the Administration Agreement may be terminated, subject to the prior approval of the Authority, at any time by either party upon not less than ninety (90) days’ prior written notice, (ii) the Administrator shall not be liable to the Sub-Funds or any other party unless, it has been negligent, has willfully defaulted or committed a fraud has materially breached the Administration Agreement, or has breached applicable laws and regulations and (iii) the Sub-Funds fully indemnify, among others, the Administrator, its affiliates, other Standard Chartered Bank Members, the Administrator's Agents, and their respective directors, officers, employees, agents and nominees, on demand against any losses, claims, expenses of any kind (including legal and professional expenses), actions or proceedings of any nature which may be incurred by the Administrator arising out of or in connection with the services provided by the Administrator, other than by reason of, among others, the Administrator’s own negligence, willful default or fraud in connection with the provision of such services.
The Administrator does not provide any investment management or advisory services to the Sub-Funds and, therefore, is not in any way responsible for the Sub-Funds’ performance, the repayment of capital to the Sub-Funds’ Investors, the monitoring of the Sub-Funds’ investments or the Sub-Funds’ compliance with its investment objectives or restrictions, borrowing restrictions or operating guidelines. The Administrator will not participate in transactions or activities or make any payments denominated in US dollars, which, if carried out by a US person, would be subject to sanctions of the Office of Foreign Assets Control. Except for the sections relating to its services, the Administrator was not involved in preparing, and accepts no responsibility for any information contained in, this Prospectus.
(B) Registrar and Transfer Agent
The Fund Manager acts as registrar and transfer agent.
The Fund Manager will, among others, be in charge of ensuring that the Fund complies with the applicable AML/CFT laws and regulations, administering and processing subscriptions and issuance, repurchase and transfer requests from investors, collecting subscription payments and disbursing repurchase payments, assisting with keeping up to date the register of Unitholders of the Fund (the “Register”), providing confirmations of Unit ownership to Unitholders and such other administrative services as may be required from time to time.
The Fund Manager will maintain the Register at its registered office. The Register is conclusive evidence of the number of Units in the relevant Fund held by each Unitholder and the entries in the Register shall prevail if there is any discrepancy between the entries in the Register and the details appearing on any statement of holding, unless the Unitholder proves to the satisfaction of the Fund Manager that the Register is incorrect.
In connection with the provision of these services, the Fund Manager may receive support from entities within the Chocolate Group pursuant to intra-group service provision arrangements to which the Fund Manager is a party.
For this purpose, “Chocolate Group” means an entity that satisfies each of the conditions set out below:
- it is the ultimate holding company of the Fund Manager from time to time (the “Parent”), or a body corporate that is from time to time directly or indirectly controlled by the Parent, or by any subsidiary of the Parent, in each case with Control being determined in accordance with the definition of “Control” under the Funds Regulations; and
- it is a party to the intra group master agreement executed on 29 July 2025 (as amended, restated, novated, supplemented, or replaced from time to time) that governs intra group service provision and receipt, by being an original signatory or by validly acceding in the manner contemplated by that agreement.
For the avoidance of doubt, membership of the Chocolate Group requires satisfaction of both conditions above. No person or entity is a member of the Chocolate Group solely by reason of it having any direct or indirect ownership, economic interest, governance right, veto right, management right, or other influence in relation to the Parent or any member of the Chocolate Group.
3.7 Auditor of the Fund
The Auditor has been appointed as the auditor of the Sub-Funds.
3.8 Shariah Supervisory Committee
The Fund Manager may establish Shariah compliant Sub-Funds. Investments and operations of Shariah compliant Sub-Funds will be conducted in accordance with the principles of Shariah.
The Fund Manager will appoint a Shariah Supervisory Committee pursuant to a Shariah Supervisory Committee agreement with regards to any Shariah compliant Sub-Funds, as further described in the relevant Sub-Fund Supplements. The composition as well as the role and responsibility of the Shariah Supervisory Committee will also be set out in the relevant Sub-Fund Supplements.
The Shariah Supervisory Committee may receive a fee in respect of each Shariah compliant Sub-Fund as set forth in the relevant Sub-Fund Supplement.
To the extent that any terms of this Prospectus permit investment in a manner inconsistent with the principles of Islamic Shariah applicable to a Shariah compliant Sub-Fund, such manner of investment will not be permitted in relation to the aforementioned Shariah compliant Sub-Fund and will be replaced with Shariah compliant manners of investment.
4. Units
4.1 Unit Characteristics
(A) Available Classes
Each Sub-Fund may issue Units in several separate Classes of Units, as set out in each Sub-Fund Supplement. Such Classes of Units may differ with respect to the type of investors for which they are designed, their Pricing Currency and, as the case may be, with respect to their fee structure.
(B) Unitholder Rights
All Unitholders of the same Class of Units have equal rights and obligations. Each Unit is entitled to one vote at any General Meeting of Unitholders. There are no preferential or pre-emptive rights attributable to the Units.
(C) Reference Currency/Base Currency/Pricing Currency
The Reference Currency of the Fund is the U.S. Dollar. The Base Currency of each Sub-Fund and the Pricing Currency of each Class of Units are as set out in each Sub-Fund Supplement.
(D) Dividend Policy
The Fund may issue Distributing Classes and Accumulating Classes of Units within each Sub-Fund, as set out in each Sub-Fund Supplement.
Accumulating Classes of Units capitalise their earnings whereas Distributing Classes of Units pay dividends which will be deposited to the related Unitholder’s account within maximum fifteen (15) calendar days of the dividend’s due date.
If a Unitholder does not have an account (e.g., bank account or digital account), if such account has been closed, or in any other situation where the payment to the Unitholder’s account is not possible, the dividends will be transferred to the Authority under the name of the relevant Unitholder within maximum fifteen (15) calendar days of the dividend’s due date or according to any other instructions which may be issued by the Authority in this regard.
For Units of Classes entitled to distribution (i.e., Distributing Classes), dividends (if any) will be declared by the Fund Manager and distributed out of the net income and, potentially net assets, available for distribution. It is expected for dividends to be distributed annually. However, interim dividends may be declared and distributed from time to time at a frequency decided by the Fund Manager in compliance with the conditions set forth by law.
For Units of Classes capitalising/accumulating their earnings (i.e., Accumulating Classes), dividends can be reinvested in further Units within the same Class of the same Sub-Fund. No Subscription Fees will be imposed on reinvestments of dividends or other distributions.
Dividends of Shariah compliant Sub-Fund(s) are subject to the purification of Shariah non-compliant income (if any) as per the Shariah Supervisory Committee advice and decision before the final distribution to the respective investors. Alternatively, Shariah non-compliant income that has been identified may be paid to Unitholders who will be provided information on the Shariah non-compliant portion of the income that is distributed to them. Any alternative distribution policy may be adopted only with the prior approval of the Shariah Supervisory Committee.
(E) Listed Classes
The Fund Manager may, in its sole discretion, elect to list any Classes of Units on any stock exchange, subject to the Authority’s approval.
(F) Fractional Units
The Sub-Fund may issue whole and fractional Units up to six (6) decimal places. Fractional Units of less than one whole Unit do not carry voting rights but do grant rights of participation on a pro-rated basis in net results and liquidation proceeds attributable to the relevant Sub-Fund.
(G) Unit Registration
All Units are issued in uncertificated registered form, and the register of Unitholders is conclusive evidence of ownership. The Fund treats the registered owner of a Unit as the absolute and beneficial owner thereof. All Unitholders shall receive from the Fund Manager a confirmation of their shareholding.
Any request for subscription, redemption, transfer and conversion shall be irrevocable except in the event of a suspension of the calculation of the Net Asset Value.
(H) Eligible Investors
Only persons who satisfy the requirements of this Prospectus and who are not Restricted Persons, and do not become Restricted Persons while holding Units, may subscribe for or hold Units in the Fund.
The Fund Manager shall not be obliged to disclose to any Restricted Person their status as a Restricted Person, or the reasons for such status, to the extent such disclosure shall not be permitted by applicable laws and regulations.
The Fund Manager may, from time to time, waive or modify the above restrictions.
4.2 Subscription of Units
(A) Minimum Investment Amount, Maximum Investment Amount and Minimum Holding Amount
Unless otherwise indicated in a Sub-Fund Supplement, no investor may subscribe or commit initially or subsequently for less than the minimum initial and subsequent subscription amounts of Units or Commitment indicated in the relevant Sub-Fund Supplement. No investor may transfer or redeem Units of any Class if the transfer or redemption would cause the investor’s holding amount of that Class of Units to fall below the minimum holding amount indicated, as the case may be, in the relevant Sub-Fund Supplement.
Certain Classes of Units may also be subject to a maximum investment or Commitment amount per investor, as specified in the relevant Sub-Fund Supplement, beyond which additional subscriptions may not be accepted.
The Fund Manager may, subject to applicable law and provided that equal treatment of Unitholders be complied with, (i) grant Unitholders an exemption from the conditions of minimum holding and accept a redemption request that would cause the investor’s holding in any Sub-Fund to fall below the minimum holding amount for such Units and/or (ii) grant Unitholders an exemption from the conditions of minimum subscription of Units or Commitment and accept subscriptions or Commitments in any Sub-Fund in an amount inferior to the minimum initial subscription amount or Commitment, or minimum subsequent subscription amount or Commitment for such Units.
(B) Subscription Fee
The subscription of Units may be subject to a subscription fee of a percentage of the value of the amount being subscribed as indicated in the relevant Sub-Fund Supplement, and which may revert, if applicable, to intermediaries or Distributors (the “Subscription Fee”). The Subscription Fee, as further described in each Sub-Fund Supplement, is to be considered a maximum rate and the Fund Manager may decide at its discretion, but taking into account the fair treatment of investors, to waive this charge in whole or in part. In particular, the Fund Manager may waive the Subscription Fee applicable to (i) a Sub-Fund investing in another Sub-Fund of the Fund; (ii) any fund managed by the Fund Manager or its affiliate investing in a Sub-Fund of the Fund; and (iii) any other arrangement in which the Fund Manager may choose to waive any Subscription Fee.
(C) Prevention of Market Timing
The Fund Manager does not knowingly allow investments which are associated with market timing practices as such practices may adversely affect the interests of all Unitholders.
In general, market timing refers to the investment behaviour of an individual or company or a group of individuals or companies buying, selling or exchanging units or other securities on the basis of predetermined market indicators by taking advantage of time differences and/or imperfections or deficiencies in the method of determination of the net asset value. Market timers may also include individuals or groups of individuals whose securities transactions seem to follow a timing pattern or are characterised by frequent or large exchanges.
Accordingly, the Fund Manager may, whenever it deems it appropriate and using its existing discretion, take the following decisions or, cause any of its agents to implement measures, such as rejecting any application for switching and/or subscription of Units from investors whom the Fund Manager, in its sole discretion, considers market timers, and/or adjusting the Net Asset Value per Unit to more accurately reflect a Sub-Fund’s value.
(D) Application for Subscription
Onboarding
An investor wishing to invest in the Fund must first complete the onboarding process on the Digital Platform, including the provision of all information and documentation required by the Fund Manager (including anti-money laundering documentation).
The investor must then confirm acceptance through such electronic mechanisms as the Fund Manager may make available from time to time, which may include tick-box confirmation or selection of an acceptance button such as “Agree and Proceed”. By providing such electronic acceptance, the investor confirms that it has read, understood, and agrees to be legally bound by this Prospectus and all other documents made available on the Digital Platform in connection with the Fund.
The information provided by the investor, together with such electronic acceptance, shall constitute the completed and executed application for subscription (the “Application Form”) governing each subscription for Units in the Fund, and shall have the same legal effect, validity, and enforceability as a handwritten signature or wet-ink execution.
Subscriptions during the Initial Offering Period may be effected otherwise than through the Digital Platform, in such manner as may be notified by the Fund Manager.
Initial and Subsequent Subscriptions
Once the investor has been onboarded, the investor may submit an initial subscription and any subsequent subscriptions to the Fund exclusively through the Digital Platform.
Process
The Fund Manager will consolidate all subscription applications received through the Digital Platform by the Cut-Off Time set out in the relevant Sub-Fund Supplement on each Subscription Day.
The application for subscription of Units must include:
- the monetary amount the investor wishes to subscribe/commit, and
- the Sub-Fund and Class from which Units are to be subscribed.
The Fund Manager and any of its agents may request an investor, or a Distributor in respect of such investor, to provide additional information to substantiate any representation made by the investor in its application. Any application that has not been executed to the satisfaction of the Fund Manager may be rejected. In addition, the Fund Manager, in its sole discretion, may at any time suspend or close the sale of any Class of Units or all Units of any or all Sub-Funds.
Applicants should be aware of the risks associated with executing Application Forms by electronic or other digital means of communication (including the Digital Platform). The Fund, the Fund Manager and their respective agents accept no responsibility for any loss caused due to any non-receipt. Applications are irrevocable.
(E) Initial Offering Period
In accordance with the Funds Regulations, each Sub-Fund must reach its Minimum Viable Size during the Initial Offering Period stated in the relevant Sub-Fund Supplement.
The Initial Offering Period of any Sub-Fund shall not be less than five (5) working days and shall not exceed three (3) months, subject to additional periods with the prior approval of the Authority.
In the event of subscriptions exceeding the Minimum Viable Size during the Initial Offering Period, the Unitholders will be issued additional Units corresponding to their subscribed amount.
For certain Sub-Funds, the Fund Manager and/or any members of the Chocolate Group may invest an initial amount in order to reach the Minimum Viable Size (the “Seed Capital”). The Seed Capital supports the operations of such Sub-Fund in its early existence prior to material external investment and may also be applied towards any transfer of Units to be made by the Fund Manager and/or any member of the Chocolate Group in the context of the Top-Up Feature. The relevant members of the Chocolate Group may withdraw their Seed Capital to the extent not applied towards any transfer of Units in connection with the Top-Up Feature, and will manage any withdrawal with the best interests of the remaining Unitholders in mind.
(F) Subscription Process
A Sub-Fund may be characterised as being subscription-based or commitment-based as further described below and in the relevant Sub-Fund Supplement.
If the documentation required by the Fund Manager or any of its agents for compliance with anti-money laundering laws and regulations is not complete at the time a subscription request is made by an investor, the subscription acceptance will be returned to the applicant or kept on hold until the necessary documentation is provided and is in order.
(1) Subscription-Based Sub-Funds
(a) Subscription Day and Purchase Price
In the case of subscription-based Sub-Funds, Units may be subscribed on Subscription Days. The Subscription Day for any subscription application shall be as indicated in the relevant Sub-Fund Supplement.
The Subscription Price shall be as indicated in the relevant Sub-Fund Supplement.
Unless otherwise indicated in the relevant Sub-Fund Supplement, any Class of Units that is launched or first subscribed for after the Initial Offering Period of a Sub-Fund will be initially offered at the Initial Offer Price applicable to such Sub-Fund or, as the case may be, to such Class, as indicated in the relevant Sub-Fund Supplement (or its equivalent in the relevant Pricing Currency, as applicable) until the first Net Asset Value for that Class has been calculated.
If the subscription is accepted, the Fund Manager will endeavour to confirm such acceptance by electronic or other digital means to the applicant within three (3) Business Days of actual receipt by the Fund Manager of the subscription application submitted via the Digital Platform. If the applicant fails to receive such confirmation from the Fund Manager within three (3) Business Days of submitting such subscription application via the Digital Platform, the applicant should contact the Fund Manager to ascertain the status of its subscription, as it cannot assume its successful subscription until it receives such confirmation from the Fund Manager.
(b) Payment
Each investor must pay the Subscription Price as described in the relevant Sub-Fund Supplement.
The Subscription Price (plus any Subscription Fee) must be paid in the Pricing Currency of the Unit Class, as indicated in the relevant Sub-Fund Supplement. The Subscription Price must be paid in the manner specified on the Digital Platform.
Cleared funds (net of any bank and conversion charges) equal to the full amount of the Subscription Price (plus any Subscription Fee) must be received by the Fund within the settlement period set out in the relevant Sub-Fund Supplement (the “Settlement Date”) which is normally 8 am GST on each Subscription Day, unless otherwise indicated in the relevant Sub-Fund Supplement.
If the payment of the Subscription Price (plus any Subscription Fee) has not been received by the Settlement Date, any pending application for Units will be carried forward to the next Subscription Day (if any).
(2) Commitment-Based Sub-Funds
In the case of commitment-based Sub-Funds, each investor whose subscription is accepted and that is admitted as an investor of the relevant Sub-Fund will typically be required to make one or several cash payments to such Sub-Fund from time to time (as required) in satisfaction of such investor’s Commitment or, in some cases, may be required to make a cash payment up front, as further described in the relevant Sub-Fund Supplement.
Each commitment-based Sub-Fund may have one or more closings, as described in, and in accordance with, each Sub-Fund Supplement and as determined by the Fund Manager in its sole and absolute discretion, at which investors will be admitted to the Fund in respect of the relevant Sub-Fund.
The subscription process for a commitment-based Sub-Fund is further described in the relevant Sub-Fund Supplement.
(G) Subscriptions in Kind
The Sub-Fund may accept subscriptions (including Commitments) in kind in a Sub-Fund as stated in each Sub-Fund Supplement, provided that such assets contributed in kind comply with the investment objectives and policies of such Sub-Fund and in compliance with the conditions set forth by the Funds Regulations, including in particular any requirements to perform a valuation of the assets contributed in kind. Any costs incurred in connection with a subscription in kind shall be borne by the relevant Unitholder(s). The Fund Manager or its duly appointed delegate must give prior and explicit approval for any in-kind subscriptions.
4.3 Transfer of Units
(A) Public Fund
A Unitholder in a Sub-Fund that is a Public Fund, may request the transfer of their Units to one or more other persons, provided that all Units have been paid in full with cleared funds and each transferee meets the qualifications of an investor in the relevant Class of Units. Notwithstanding the foregoing, the Fund Manager may take such action as it considers necessary or appropriate to refuse, suspend or delay a transfer where required for regulatory, legal, operational or administrative reasons.
The holding at any time of any Units by an investor which does not meet the qualifications of an investor in the relevant Class of Units may result in the compulsory redemption of such Units as further described under Section 4.5 below, or the non-acceptance by the Fund Manager of such transfer request.
(B) Private Fund
Unless otherwise indicated in a Sub-Fund Supplement, a Unitholder in a Sub-Fund that is a Private Fund, may only transfer Units in the following cases:
- to existing Unitholders in that Sub-Fund; or
- to Professional Investors or Counterparty, provided that the minimum nominal value of the transferred Units shall not be less than one hundred eighty thousand Dirhams (AED 180,000) or the equivalent amount in other currencies,
in each case provided that all Units have been paid in full with cleared funds and each transferee meets the qualifications of an investor in the relevant Class of Units, and subject to the Fund Manager’s approval of such transfer request.
The holding at any time of any Units by an investor which does not meet the qualifications of an investor in the relevant Class of Units may result in the compulsory redemption of such Units as further described under Section 4.5 below, or the non-acceptance by the Fund Manager of such transfer request.
(C) Procedure
In order to transfer Units, the Unitholder must notify the Fund Manager of the proposed transfer date and the number of Units to be transferred. The Fund Manager will only recognise a transfer with the same or a future effective date, subject to its approval. In addition, each transferee may need to complete a transfer request via the Digital Platform.
The Unitholder should send its request and each transferee’s additional details (if required) to the Fund Manager via the Digital Platform.
The Fund Manager and any of its agents may request a transferee to provide additional information to substantiate any representation made by the transferee in its application. Any application that has not been completed to the satisfaction of the Fund Manager may be rejected.
The Fund Manager will not effectuate any transfer until it is satisfied with the form of request and has accepted each transferee’s application including compliance with anti-money laundering laws and regulations. Any Unitholder transferring Units and each transferee, jointly and separately, agree to hold the Sub-Fund, the Fund Manager and each of their respective agents harmless with respect to any loss suffered by one or more of them in connection with a transfer.
The Fund Manager in its sole discretion shall determine whether it accepts any transfer request.
4.4 Redemption
(A) Redemption of Units
(1) Public Fund
Unless otherwise indicated in a Sub-Fund Supplement, all Sub-Funds that are Public Funds are Open-ended and Unitholders may request the redemption of some or all of the Units they hold in the Sub-Fund(s). If as a result of any redemption request, the number of Units held by any Unitholder in a Class would fall below the minimum holding amount for that Class of Units, if any, the Sub-Fund may treat such request as a request to redeem the full balance of such Unitholder’s holding of Units in the relevant Class. These Units may then be redeemed on Redemption Days referred to in the relevant Sub-Fund Supplement.
If the documentation required by the Fund Manager for compliance with anti-money laundering laws and regulations is not complete at the time a redemption request is made, the payment will be kept on hold until the necessary documentation is provided and in order.
The procedure in relation to such redemption of Units is further set out below at Section 4.4 (B) to Section 4.4 (F).
(2) Private Fund
Sub-Funds that are Private Funds can be either Open-ended or Closed-ended, as specified for each Sub-Fund in its Sub-Fund Supplement.
The redemption option and procedure are detailed in the relevant Sub-Fund Supplement.
In any case, if the documentation required by the Fund Manager for compliance with anti-money laundering laws and regulations is not complete at the time a redemption request is made, the payment will be kept on hold until the necessary documentation is provided and in order.
(B) Redemption Request
To redeem Units in the Fund, Unitholders shall submit a redemption request via the Digital Platform. By electronically accepting this Prospectus, the Unitholder shall be deemed to have acknowledged, understood and accepted all terms and conditions in relation to redemptions and redemption requests set out herein. Each redemption request will require the Unitholder to confirm their awareness of, and agreement with the applicable redemption terms.
The Fund Manager will consolidate all redemption requests received through the Digital Platform by the Cut-Off Time set out in the relevant Sub-Fund Supplement on each Redemption Day.
That redemption request must include the following:
- the Unitholder’s name, as it appears on the Unitholder’s account, their address and account number; and
- the number of Units of each Class or the amount in the Pricing Currency of the Units to be redeemed.
If a redemption request is accepted, the Fund Manager will endeavour to confirm such acceptance by electronic or other digital means to the Unitholder within three (3) Business Days of actual receipt by the Fund Manager of the redemption request submitted in good order via the Digital Platform. If the Unitholder fails to receive such confirmation from the Fund Manager within three (3) Business Days of submitting such redemption request via the Digital Platform, the Unitholder should contact the Fund Manager to ascertain the status of its redemption request, as it cannot assume its successful redemption request until it receives such confirmation from the Fund Manager. Unitholders should be aware of the risks associated with sending redemption requests by electronic or other digital means of communication (including the Digital Platform). The Fund, the Fund Manager and their respective agents accept no responsibility for any loss caused due to the non-receipt.
The Fund Manager and any of its agents may request the Unitholder to provide additional information to substantiate any representation made by the Unitholder in the request. The Fund Manager may reject any redemption request that has not been completed to its satisfaction.
Any Unitholder redeeming Units agrees to hold the Sub-Fund, the Fund Manager and each of their respective agents harmless with respect to any loss suffered by one or more of them in connection with any redemption.
Unless otherwise provided in the relevant Sub-Fund Supplement, all redemption requests, including Special Redemption Requests, shall be processed in accordance with this Section 4.4. However, Special Redemption Requests shall also be subject to any specific terms applicable to them as set out in the relevant Sub-Fund Supplement, which may apply in addition to, or in substitution for, the provisions of this Section 4.4 to the extent specified therein.
(C) Redemption Fee
The redemption of Units may be subject to a redemption fee, expressed either as a percentage of the Net Asset Value per Unit of the Units being redeemed or as a flat fee, as specified in each Sub-Fund Supplement (the “Redemption Fee”). Any Redemption Fee shall be levied for the benefit of the relevant Sub-Fund.
(D) Redemption Price
The Units will be redeemed at the Redemption Price.
Unitholders should note that they will not know the Redemption Price of their Units until their redemption request has been completed.
(E) Payment
The Sub-Fund will pay the Unitholder redemption proceeds as determined in the relevant Sub-Fund Supplement.
The redemption proceeds will be paid by electronic bank transfer to the bank account on file with the Fund Manager. All costs associated with that payment will be borne by the Unitholder unless the Fund Manager elects to waive such costs. Redemption proceeds will be paid in the relevant Pricing Currency.
Neither the Sub-Fund nor any of its agents shall pay any interest on redemption proceeds or make any adjustment on account of any delay in making payment to the Unitholder. Any redemption proceeds that have not been claimed within five (5) years following the redemption date shall be forfeited and shall accrue for the benefit of the relevant Class of Units.
(F) Redemption in specie
A Unitholder may redeem Units in specie, provided that the Fund Manager determines that the redemption would not be detrimental to the remaining Unitholders of the Sub-Fund and the redemption is effected in compliance with any conditions set forth by the Funds Regulations. Any costs incurred in connection with redemptions in kind shall be borne by the relevant Unitholders. The Fund Manager or its duly appointed delegate must give prior and explicit approval for any redemptions in specie.
4.5 Compulsory Redemption
Unless otherwise indicated in a Sub-Fund Supplement, the Sub-Fund may immediately redeem some or all of a Unitholder’s Units if the Fund Manager believes that:
- the Unitholder is a U.S. Person;
- the Unitholder has made any misrepresentation as to their qualifications to be a Unitholder or has not provided the necessary information requested by the Fund, the Fund Manager, the Administrator or any of their respective agents in order to comply with legal and regulatory rules, such as but not limited to anti-money laundering or FATCA or the CRS provisions;
- the Unitholder becomes ineligible as a result of any change in their circumstances, including but not limited to, becoming the subject of any sanctions or similar determinations;
- the Unitholder’s continued presence as a Unitholder of the Sub-Fund would cause irreparable harm to the Sub-Fund or other Unitholders of the Sub-Fund;
- the Unitholder, in the Fund Manager’s determination, by trading Units frequently, is causing the relevant Sub-Fund to incur higher portfolio turnover and thus, causing adverse effects on the Sub-Fund’s performance, higher transactions costs and/or greater tax liabilities;
- the Unitholder’s continued presence as a Unitholder would result in a breach of any law or regulation, whether UAE or foreign, by the Fund such as but not limited to FATCA or the CRS;
- such redemption is required or advisable in order to comply with any applicable law, regulation, directive or order of any competent regulatory authority, governmental authority or court of competent jurisdiction; or
- the Sub-Fund should be liquidated in accordance with Section 10.2 below.
Unless otherwise indicated in a Sub-Fund Supplement, the redemption price for any compulsory redemption will be the relevant Net Asset Value per Unit of such Units on the redemption date less any applicable fees and costs.
The Fund Manager shall not be obliged to disclose the reasons for such compulsory redemption to the extent such disclosure shall not be permitted by applicable laws and regulations.
4.6 Conversion of Units
Unless otherwise indicated in a Sub-Fund Supplement, Unitholders are entitled to convert all or part of their Units of one Sub-Fund into Units of another Sub-Fund, and may also convert from one Class of Units of a Sub-Fund into other Classes of Units of that Sub-Fund or Classes of Units of other Sub-Funds, provided that Unitholders meet the eligibility criteria for the Class of Units into which they are converting, as detailed in the relevant Sub-Fund Supplement(s).
The Fund Manager reserves the right to reject any conversion application in whole or in part.
To exercise the right to convert Units, the Unitholders must submit a conversion order via the Digital Platform.
Orders received on the Digital Platform after the conversion cut-off time set out in the relevant Sub-Fund Supplement, will be dealt on the next Conversion Day.
However, a conversion request shall be executed only on the next date that is both (i) a Conversion Day in respect of the Sub-Fund from which the Unitholder seeks to convert, and (ii) a Subscription Day in respect of the Sub-Fund into which the Units are to be converted. For example, if Unitholders convert from a Sub-Fund that deals daily into a Sub-Fund that deals twice a month, the redemption will be processed so that the Unitholders remain invested in the Sub-Fund they convert from as long as possible and the conversion request will only be executed to match the next Subscription Day of the Sub-Fund the Unitholders convert to.
Conversion requests will be dealt with on the basis of the Net Asset Value per Unit on the relevant Conversion Day, except for Initial Offering Periods, during which the price is the Initial Offer Price.
If compliance with conversion instructions would result in a residual holding in any Class to fall below the minimum holding of that Class, the Fund Manager may compulsorily redeem the residual Units at the Redemption Price applicable on the day on which conversion requests will be processed and make payment of the proceeds to the Unitholder.
A conversion fee of a percentage of the value of the Units which are being converted, as further described in each Sub-Fund Supplement, may be payable to an intermediary or Distributor, as determined by the Fund Manager (the “Conversion Fee”).
When a currency conversion is required because the Net Asset Values per Unit of the converted Units are denominated in different currencies, the currency conversion rate of the relevant Conversion Day applies.
For Unitholders in a Sub-Fund who invest initially in Classes of Units where no or a low Subscription Fee is usually payable and subsequently switch into Classes of Units of the same or different Sub-Funds with higher Subscription Fees, such conversions may be subject to the Subscription Fee, applied at the Fund Manager’s discretion, which is normally payable on direct investments into such Classes of Units.
If the Fund Manager determines that it would be detrimental to the existing Unitholders of a Sub-Fund to accept a conversion application for Units to exit the relevant Sub-Fund for another Sub-Fund, the Fund Manager may decide to defer that all or part of such applications for Units in accordance with the relevant deferral provisions described under Section 8.2.
4.7 UAE Anti-Money Laundering Regulations
Measures aimed at the prevention of money laundering and terrorist financing require a detailed verification of the identity of an applicant for Units and the beneficial owner, on a risk sensitive basis, as well as the monitoring of the relationship on an ongoing basis.
The Fund Manager must verify the identity of the applicant and any beneficiary(ies), and for that purpose the applicant is obliged to submit to the Fund Manager all necessary information which the Fund Manager and any of its agents may reasonably require. The Application Form of the applicant and any request to transfer to any other beneficiary, must be accompanied by, but not limited to, in the case of individuals, a copy of a passport or identification card (certified by a competent authority in their respective country if required by the Fund Manager) and/or in the case of legal entities, a copy of the constitutional documents and an extract from the commercial register (or alternative depositary in accordance with local law). In the case of an applicant acting on behalf of a third party, the Fund Manager must also verify the identity of the beneficial owner(s). Furthermore, any such applicant hereby undertakes that it will notify the Fund Manager prior to the occurrence of any change in the identity of any such beneficial owner.
The Unitholder shall provide any additional information the Sub-Fund, the Fund Manager or any of their respective agents may reasonably require for the purposes of monitoring the status or other information of the Unitholder and to ensure due compliance on an ongoing basis with any applicable law or regulation.
A delay or failure by the applicant to produce any information required for verification purposes may cause instructions to be delayed or lapse or be cancelled.
Notwithstanding any other provision of this Prospectus, the Fund and the Fund Manager may suspend, restrict or prevent any subscription, redemption, transfer or other dealing in Units, and may freeze any Unitholder’s account, Units or proceeds, to the extent required or considered necessary to comply with applicable law, regulation, regulatory guidance or any direction or order of a competent authority (including any anti-money laundering, counter-terrorist financing or sanctions requirements).
5. Investment Objective, Strategy and Restrictions
The main objective of the Fund is to provide investors with a selection of professionally managed Sub-Funds investing in and/or offering exposure to a wide range of eligible Assets in order to achieve an optimum return from capital invested, while reducing investment risk.
Each Sub-Fund shall comply with the rules and restrictions detailed in its Sub-Fund Supplement, subject to any additional rules and restrictions provided for its specialist class under the Funds Regulations. The investment objectives and restrictions of any Sub-Fund may be amended to ensure compliance with any revisions to the Funds Regulations, in which case the prior approval of Unitholders by Ordinary Resolution or Special Resolution will not be required.
The Fund Manager shall have the power to determine the corporate and investment policy for the investments for each Sub-Fund, the Base Currency, the Pricing Currency, as the case may be, and the course of conduct of the management and business affairs of the Fund and all Sub-Funds.
In accordance with the Funds Regulations, each Sub-Fund is to be considered as a separate fund for the purposes of its investment objectives and restrictions.
A Sub-Fund may invest into another Sub-Fund of the Fund, subject to such investment being in compliance with its investment objective and restrictions as set out in the relevant Sub-Fund Supplement.
Borrowing by a Sub-Fund is subject to the provisions outlined in the relevant Sub-Fund Supplement.
In accordance with the Funds Regulations, Sub-Funds of a specialist class may be subject to specific investment restrictions applicable to that specialist class. These investment restrictions, as applicable pursuant to the Funds Regulations to a Sub-Fund, are set out in the relevant Sub-Fund Supplement.
6. Fees and Expenses
6.1 General
The Sub-Fund pays out of its Assets all expenses payable by the Sub-Fund. Those expenses include in particular, but are not limited to:
(a) fees payable to (i) the Fund Manager, (ii) the Investment Manager (if any), (iii) the Investment Adviser (if any) and (iv) the Distributors;
(b) fees payable to other service providers: (i) the Custodian, (ii) the Administrator, (iii) the independent auditors, (iv) counsels and other professionals, (v) the Shariah advisors (if any) and (vi) the Shariah Supervisory Committee (if any);
(c) administrative expenses, such as registration fees, insurance coverage and the costs relating to the translation and printing of this Prospectus, the Key Investor Information Document(s) and reports to Unitholders; and
(d) the Expenses specific to the Sub-Fund or Class(es) of Units of that Sub-Fund. This includes the costs and expenses of all transactions carried out for such Sub-Fund or Class(es) of Units such as brokers’ commissions (if any), borrowing / financing charges (if any) and any issue or transfer taxes chargeable in connection with any securities transactions, all taxes and corporate fees payable to governments or agencies, interest on borrowings/payable profit on Islamic financing, litigation and indemnification expenses and extraordinary expenses not incurred in the ordinary course of business and all other organisational and operating expenses reasonably incurred for such Sub-Fund or Class of Units. Charges that are not specifically attributable to a particular Sub-Fund or Class of Units may be allocated among the relevant Sub-Fund(s) or Class(es) of Units based on their respective net assets or any other reasonable basis given the nature of the charges.
The fees and expenses described in points (b) to (d) (inclusive) are together the “Operating Expenses”.
The costs and expenses incurred in connection with the formation of the Sub-Funds and the initial issue of Units by the Sub-Funds, including all legal and fiscal costs, as well as certain launch expenses and other preliminary expenses may be split in such amount in each Sub-Fund of the Fund as determined by the Fund Manager on an equitable basis in accordance with the IFRS.
All fees and expenses pursuant to the above are exclusive of any VAT or other amounts chargeable thereon, which shall be paid directly or indirectly out of the Assets of the relevant Sub-Fund(s) as required.
Where it qualifies, the Fund and each Sub-Fund shall register for UAE VAT and/or UAE Corporate Tax in accordance with applicable law. Section 13 provides further details.
6.2 Management Fee
In consideration of its services, the Fund Manager is entitled to receive a Management Fee in respect to each Sub-Fund. The calculation of this Management Fee and applicable rate are more fully described in each Sub-Fund Supplement.
The Fund Manager may waive part or all of the Management Fee applicable to (i) a Sub-Fund investing in another Sub-Fund of the Fund; (ii) any fund managed by the Fund Manager or its affiliate investing in a Sub-Fund of the Fund; or (iii) any other arrangement that the Fund Manager may, in its sole discretion, consider appropriate.
The Fund Manager shall deduct their fees and cover any supportive services received from third parties from their own management fees, including any fees to Investment Advisers, Distributors, sub-distributors, and other intermediaries and service providers.
6.3 Performance Fee
In consideration of its services, the Fund Manager may also be entitled to receive a Performance Fee in respect to a Sub-Fund. The calculation of this Performance Fee and applicable rate are more fully described in the relevant Sub-Fund Supplement(s).
6.4 Investment Management Fee
The Investment Manager (if any) may receive an Investment Management Fee for the provision of its services to the Fund Manager in respect of the relevant Sub-Fund(s). The calculation of the Investment Management Fee (if any) and applicable rate are more fully described in the relevant Sub-Fund Supplement(s).
The Investment Manager shall deduct their fees and cover any supportive services received from third parties from their own investment management fees, including any fees to Investment Advisers, dealers and other intermediaries and service providers.
6.5 Custodian Fee
The Custodian may receive a fee in respect of each Sub-Fund (the “Custodian Fee”). The Custodian Fee in respect of each Sub-Fund is described in each Sub-Fund Supplement.
6.6 Administrator Fee
The Administrator may receive a fee in respect of each Sub-Fund (the “Administrator Fee”). The Administrator Fee in respect of each Sub-Fund is described in each Sub-Fund Supplement.
6.7 Auditor Fee
The Auditor will receive an annual audit fee of approximately AED 120,000 (excluding VAT) per Sub-Fund.
6.8 Shariah Advisors (if any) and/or the Shariah Supervisory Committee (if any)
The Sub-Fund(s)’ Shariah Advisors (if any) and/or the Shariah Supervisory Committee (if any) may receive a fee in respect of each Sub-Fund (the “Shariah Advisors Fee” and/or “Shariah Supervisory Committee Fee”) as described in each Shariah-compliant Sub-Fund Supplement.
7. Determination of the Net Asset Value
7.1 Day of Calculation
The Administrator calculates the Net Asset Value of each Class of Units on each Valuation Day, as may be further indicated for each Sub-Fund in the relevant Sub-Fund Supplement.
7.2 Method of Calculation
The Net Asset Value per Unit in a Sub-Fund on any Valuation Day is determined by dividing the value of the portion of assets attributable to that Class less the portion of liabilities attributable to that Class, by the total number of Units of that Class outstanding on such day.
The Net Asset Value per Unit of each Class shall be available at the registered office of the Fund Manager.
The Net Asset Value of each Unit shall be determined in the Pricing Currency of the relevant Class of Units.
The Net Asset Value of each Class of Unit may be rounded to four (4) decimal places of the Pricing Currency in accordance with the Fund’s guidelines.
The Assets of any Sub-Fund shall include, but not be limited to, the following:
- any cash in hand or on deposit including any outstanding interest, that has not yet been received and any interest accrued on these deposits up until the Valuation Day;
- all bills and promissory notes payable at sight as well as all accounts receivable (including proceeds from the disposal of securities for which the price has not yet been paid);
- all Transferable Securities, Money Market Instruments, units, shares, debt securities, option or subscription rights and other investments owned by the Sub-Fund (provided that the Fund Manager may make adjustments with regard to fluctuations in the market value of securities caused by trading ex-dividends, ex-rights or by similar practices);
- all dividends and distributions receivable by the Sub-Fund in cash or securities to the extent that the Fund Manager is aware thereof;
- all outstanding interest that has not yet been received and all interest accrued up until the Valuation Day on securities or other interest-bearing assets owned by the Sub-Fund, unless such interest is included in the principal of the securities; and
- any other assets whatsoever, including prepaid expenses;
(together the “Assets”).
The value of these Assets will be determined as follows:
- the value of any cash on hand or on deposit, bills and demand notes and accounts receivable, prepaid expenses, cash dividends, interest declared or accrued and not yet received, all of which are deemed to be the full amount thereof, unless in any case the same is unlikely to be paid or received in full, in which case the value thereof is arrived at after making such discount as may be considered appropriate in such case to reflect the true value thereof;
- securities and Money Market Instruments listed on a recognised stock exchange or dealt on any other regulated market will be valued at their last available price on the principal market on which such securities are traded;
- in the event that the last available closing price does not, in the opinion of the Fund Manager or its delegate, truly reflect the fair market value of the relevant securities and Money Market Instruments, the value of such securities will be defined by the Fund Manager or its delegate based on the reasonably foreseeable sales proceeds determined prudently and in good faith;
- securities and Money Market Instruments not listed or traded on a stock exchange or not dealt on another regulated market will be valued on the basis of the probable sales proceeds determined prudently and in good faith by the Fund Manager or its delegate;
- all other securities and other assets will be valued at fair market value as determined in good faith pursuant to procedures established by the Fund Manager or its delegate; and
- target funds’ units are valued at the latest redemption price determined and obtainable.
Any Assets held in a particular Sub-Fund not expressed in the Reference Currency or applicable Base Currency of such Sub-Fund, as relevant, will be translated into the Reference Currency or applicable Base Currency at the rate of exchange prevailing in a recognised market on the relevant Valuation Day.
The Fund Manager, at its discretion, may permit some other method of valuation to be used if it considers that such valuation better reflects the fair value of any asset or liability of the Sub-Funds in compliance with the relevant applicable accounting standards. This method will then be applied in a consistent way. The Fund Manager may also decide to approve the use of a systematic fair value model provided by an independent third party. The Administrator can rely on such deviations as approved by the Fund Manager for the purpose of the calculation of the Net Asset Value.
The liabilities of any Sub-Fund shall be deemed to include:
- all loans, bills and accounts payable;
- all accrued or payable administrative expenses (including any third-party fees);
- all known liabilities, present and future, including all matured contractual obligations for payment of money or property;
- an appropriate provision for future taxes based on capital and income to the relevant Valuation Day, as determined from time to time by the Fund Manager, and other reserves, if any, authorised and approved by the Fund Manager or its delegate;
- in respect of Shariah compliant Sub-Funds, Zakat payable on the zakatable underlying assets of the Shariah compliant Sub-Funds, Shariah non-compliant income purification (if any) and any other liabilities that may arise as and when Shariah rules and principles determine; and
- all other liabilities of the Sub-Fund of whatsoever kind and nature except liabilities represented by Units of the Sub-Fund. In determining the amount of such liabilities, the Fund Manager shall take into account all expenses payable and all costs incurred by the Sub-Fund, which shall comprise the fees payable to the Fund Manager (including all reasonable out-of-pocket expenses), the Investment Manager (if any), the Administrator, accountants, corporate agents, domiciliary agents, paying agents, registrars, transfer agents, permanent representatives in places of registration, Distributors (to the extent these fees are not paid by the Fund Manager, the Investment Manager, the Sub-Investment Manager or the Investment Adviser), trustees, fiduciaries, correspondent banks and any other agent employed by the Fund, fees for legal and auditing services, costs of any proposed listings and of maintaining such listings, promotion, printing, reporting and publishing expenses (including reasonable marketing and advertising expenses and costs of preparing, translating and making available in different languages) of prospectuses, addenda, explanatory memoranda, registration statements, reports (including, among others, Annual Reports and semi-annual reports), all taxes levied on the assets and the income and the expenses of the Sub-Fund, registration fees and other expenses payable to governmental and supervisory authorities in any relevant jurisdictions, insurance costs, costs of extraordinary measures carried out in the interests of Unitholders (in particular, but not limited to, arranging expert opinions and dealing with legal proceedings) and all other operating expenses, including the cost of buying and selling Assets, custody fee and customary transaction fees and charges charged by the Custodian or its agents (including free payments and receipts and any reasonable out-of-pocket expenses), customary brokerage fees and commissions charged by service providers for securities transactions and similar transactions, interest and postage, telephone, facsimile and telex charges. The Fund is permitted to estimate administrative and other regular or recurring expenses for yearly or other specified periods in advance. It may then allocate these estimated expenses across the given period.
If an Asset held by a Sub-Fund lacks an available Net Asset Value, bid or ask prices, or a price quotation, its value will be periodically determined by the Fund Manager using a method of its choosing. However, any asset of the Sub-Fund not listed, quoted, or dealt in on any securities exchange or over-the-counter market will be valued at the lower of its cost and the Fund Manager’s estimate of its realisable value.
When determining prices that are quoted, listed, traded, or dealt in the market, the Fund Manager, the Administrator, or their agents may employ and rely on automated or electronic systems for the dissemination of pricing information. The prices obtained from any such system shall be considered accurate for the purposes of valuing the assets held by the Sub-Fund.
Notwithstanding the foregoing, the Fund Manager may, at its absolute discretion, permit such other method of pricing or valuation which, in its opinion, better reflects fair value and direct the Administrator to apply this to the calculation of the Net Asset Value of the Sub-Fund.
7.3 Limitations of Net Asset Value Information
Prospective investors in a Sub-Fund should fully comprehend the nature of the Net Asset Value information. For instance, when the underlying assets are illiquid or speculative, the Net Asset Value should be interpreted similarly to investments in private equity or venture capital strategies. The participation of a third-party service provider, like the Administrator, in calculating the Net Asset Value does not imply a guarantee or representation of the asset’s realisable value. It’s important to recognise that pricing and valuation methods have their limitations and might not be applicable to every portfolio or investment strategy.
7.4 Swing Pricing (Dilution Adjustment)
The basis on which the Sub-Fund’s investments are valued for the purpose of calculating the issue and redemption price of Units is described in this Prospectus under Section 7.2 (Method of Calculation). The actual cost of purchasing or selling investments may be higher or lower than the value used in calculating the Net Asset Value and Net Asset Value per Unit – for example, due to dealing charges, or through disposal of Assets at prices lower than the value used in the calculation of the Net Asset Value or Net Asset Value per Unit. Under certain circumstances (for example, in connection with large redemptions or extraordinary market circumstances) this may have an adverse effect on the value of Units of Unitholders that remain in the Sub-Fund. In order to mitigate this effect, called “dilution”, the Fund Manager has the power to apply a “dilution adjustment”, on the issue and/or redemption of Units. A dilution adjustment is an adjustment to the Unit price. The Fund Manager shall comply with this Prospectus in its application of any such dilution adjustment. The dilution adjustment will be calculated by reference to the estimated costs of dealing in the underlying investments of the Sub-Fund, including, for example, any dealing spread, discounts to net asset value, commission and transfer taxes.
The need to apply a dilution adjustment will depend on the volume of subscriptions or redemptions. The Fund Manager may apply a dilution adjustment on the subscription and redemption of Units if, in its opinion, the existing Unitholders of the Sub-Fund (for subscriptions) or remaining Unitholders of the Sub-Fund (for redemptions) might otherwise be adversely affected, and if charging a dilution adjustment is, so far as practicable, fair to all Unitholders of the Sub-Fund and potential investors. In particular, the dilution adjustment may be charged in circumstances such as, for example:
- where over a dealing period the Sub-Fund has experienced a large level of net subscriptions or redemptions relative to its size;
ii. on large deals relative to the size of the Sub-fund; or
iii. where the Fund Manager considers it necessary to protect the interests of the Unitholders of the Sub-Fund.
When a dilution adjustment is not applied there may be a dilution of the Assets of the Sub-Fund which may constrain the future growth of the Sub-Fund. It should be noted that as dilution is directly related to the inflows and outflows of monies from a Sub-Fund, it is not possible to predict accurately whether or not dilution will occur at any particular future point in time, and how frequently the Fund Manager will need to make such a dilution adjustment.
The dilution adjustment is applied on the capital activity at the level of the Sub-Fund and does not address the specific circumstances of each individual investor transaction.
The estimated dilution adjustment may be up to 5% of the Net Asset Value per Unit on subscriptions and up to 10% of the Net Asset Value per Unit on redemptions of Units. These are estimated maximum percentages which apply in normal market conditions only and as such the Fund Manager does not expect to apply them often. However, although the dilution adjustment is normally not expected to exceed these percentages, the Fund Manager may decide to increase this adjustment limit in exceptional circumstances to protect Unitholders’ interests. It is currently expected that a dilution adjustment will be incurred only on a certain number of transactions. However, the actual percentages can only be accurately calculated at the time at which they are applied and, as such, these percentages are subject to change.
8. Suspension or Deferral
8.1 Suspension of Calculation of the Net Asset Value and of the Subscription, Conversion and Redemption of Units
The Fund Manager may temporarily suspend the determination of the Net Asset Value per Unit within any particular Class of Units and the issue and redemption of its Units from the Unitholders as well as the conversion from and to Units of each Class:
(A) during any breakdown in the means of communication network normally employed in determining the price or value of any of the relevant Sub-Fund’s investments or the current price or value on any stock exchange or market in respect of the assets attributable to such Sub-Fund, which is affecting at least five percent (5%) of the Net Asset Value per Unit of the relevant Sub-Fund;
(B) during any period when any of the principal stock exchanges or regulated markets on which a substantial part of the relevant Sub-Fund’s investments is quoted, or when one or more foreign exchange markets in the currency in which a substantial portion of the assets of the Sub-Fund is denominated, are closed or during which dealings are substantially restricted or suspended, which is affecting at least five percent (5%) of the Net Asset Value per Unit of the relevant Sub-Fund;
(C) during any period when the Sub-Fund is unable to repatriate funds for the purpose of making payments on the redemption of Units of such Sub-Fund or during which any transfer of funds involved in the realisation or acquisition of investments or payments due on redemption of Units cannot, in the opinion of the Fund Manager, be effected at normal rates of exchange;
(D) political, economic, military, monetary, climate, pandemic, or other emergency beyond the control, liability and influence of the Sub-Fund or the Fund Manager makes the disposal of the assets of any Sub-Fund impossible under normal conditions or such disposal would be detrimental to the interests of the Unitholders, which is affecting at least five percent (5%) of the Net Asset Value per Unit of the relevant Sub-Fund;
(E) following the suspension of the calculation of the Net Asset Value, issue, redemptions or conversions of shares or units of the fund or Master Fund, as applicable, in which the Sub-Fund invests as, respectively, fund of funds or feeder fund, which is affecting at least five percent (5%) of the Net Asset Value per Unit of the relevant Sub-Fund;
(F) during any period when for any other reason the prices of any investments owned by the relevant Sub-Fund cannot promptly or accurately be ascertained, which is affecting at least five percent (5%) of the Net Asset Value per Unit of the relevant Sub-Fund;
(G) during any period when the Fund Manager so decides, provided all unitholders are treated on an equal footing and all relevant laws and regulations are applied, upon the decision to liquidate or dissolve a Sub-Fund; or
(H) following a decision of merging, liquidating or dissolving the Fund or any Sub-Fund, or upon the order of the Authority.
The Fund Manager may furthermore also suspend the issue, conversion and redemption of Units of any Class within any Sub-Fund forthwith upon occurrence of an event causing it to enter into merger, liquidation or upon the order of the Authority.
Any suspension of the calculation of the Net Asset Value shall be notified to the investors and Unitholders requesting the subscription, redemption or conversion of their Units on receipt of their request for subscription, redemption or conversion. The suspension of the calculation of the Net Asset Value of any particular Sub-Fund and/or Class shall have no effect on the determination of the Net Asset Value per Unit or on the issue and redemption of Units of any other Class and/or Sub-Fund that is not suspended.
8.2 Gating and Deferral of the Subscription, Conversion and Redemption of Units
In addition, if the aggregate value of subscription, redemption or conversion requests received on the Digital Platform on any day corresponds to more than ten percent (10%) of the assets of a Sub-Fund or of a Class, the Fund Manager may defer part or all of such subscription, redemption or conversion requests for such period as it considers to be in the best interest of the Sub-Fund or of a Class and its Unitholders.
Furthermore, a Feeder Fund may be subject to more stringent gating or deferral provisions if such stricter provisions are applied at the Master Fund in which the Feeder Fund is an investor.
8.3 Consequences of a Suspension or Deferral
Unless otherwise indicated in a Sub-Fund Supplement, any suspended or deferred subscription, redemption, or conversion requests shall be treated as a priority and will be executed on the next applicable Dealing Day after the suspension or deferral ends, taking precedence over any further subscription, redemption, or conversion requests received on that Dealing Day.
9. Changes to the Fund, a Sub-Fund or a Class of Units
9.1 Public Fund
In accordance with the Funds Regulations, Material Changes and Important Changes to a Sub-Fund that is a Public Fund, are subject to Special Resolutions and Ordinary Resolution, respectively, of the General Meeting of Unitholders and, in all cases, the prior approval of the Authority. Notifiable Changes must be notified to the Authority and the Unitholders.
Any Material Changes, Important Changes or Notifiable Changes shall be disclosed on the website of the Fund Manager (www.kelvin-dev.click) at least five (5) Business Days prior to becoming effective, subject to any reduction or increase of the required notice period by the Authority.
The General Meeting of Unitholders shall be convened, subject to the prior approval of the Authority, by the Fund Manager with at least twenty-one (21) calendar days prior notice, at the date, time and location specified in the convening notice. The prior notice may be reduced subject to the Funds Regulations and the prior approval of the Authority. The convening notice to the General Meeting may be sent to Unitholders by registered mail or email or via the Digital Platform.
The Custodian, or Unitholders holding Units representing at least five percent (5%) of the Net Asset Value of the Sub-Fund(s), may request the Fund Manager to convene a General Meeting to resolve upon the agenda communicated by the Custodian or such Unitholders to the Fund Manager.
In the case where a required quorum, if any, has not been met at a General Meeting of Unitholders, the Fund Manager may convene a second General Meeting of Unitholders to resolve upon the same agenda and which will be held without quorum.
9.2 Private Fund
In accordance with the Funds Regulations, any change to the terms and conditions of the Prospectus and the Key Information Document(s) of a Sub-Fund that is a Private Fund, shall be made in accordance with the mechanism of change specified in the Sub-Fund Supplement of such Sub-Fund.
The Fund Manager shall notify the Authority and the Unitholders of that Sub-Fund of any change to the Prospectus within five (5) Business Days prior to becoming effective, subject to any reduction or increase of the required notice period by the Authority.
All matters related to the General Meeting of Unitholders, including but not limited to the convening notice, quorum, procedure and voting, shall be specified in the relevant Sub-Fund Supplement.
10. Merger and Liquidation
10.1 Merger
The Fund Manager may decide to proceed with a merger of the assets of any Sub-Fund with those of (i) another existing Sub-Fund within the Fund or (ii) another domestic or foreign fund. Such merger shall be subject to (i) the conditions and procedures imposed by UAE law and (ii) the Authority’s approval, in particular concerning the merger project to be established by the Fund Manager and the information to be provided to the Unitholders.
Subject to a prior approval from the Authority, notwithstanding the powers conferred to the Fund Manager by the preceding section, a merger of the assets and of the liabilities attributable to any Sub-Fund with another Sub-Fund within the Fund may be decided upon by a Special Resolution of the General Meeting of Unitholders of the Sub-Fund approving the merger in accordance with the provisions of the Special Resolution in the relevant law and regulations. The General Meeting of Unitholders of the Sub-Fund concerned will decide on the effective date of such a merger it has initiated within the Fund.
Subject to a prior approval from the Authority, the Unitholders may also decide a merger of the assets and of the liabilities attributable to a Sub-Fund with the assets of any new sub-fund within another fund. The decision of the merger and of the effective date of such a merger shall be made by a Special Resolution of the General Meeting of Unitholders of the Sub-Fund approving the merger in accordance with the provisions of the Special Resolution in the relevant law and regulations.
Subject to a prior approval from the Authority, the Fund or a Sub-Fund thereof may further absorb (i) another existing sub-fund within another domestic or foreign fund, or (ii) another domestic or foreign fund in compliance with UAE law by a Special Resolution of the General Meeting of Unitholders of the Sub-Fund approving the merger in accordance with the provisions of the Special Resolution in the relevant law and regulations.
10.2 Liquidation
The Fund and any Sub-Fund have been established for an unlimited period, unless otherwise indicated in a Sub-Fund Supplement.
Subject to a prior approval from the Authority, in the event that for any reason the value of the net assets in any Sub-Fund or the value of the net assets of any Class within a Sub-Fund has decreased below an amount determined by the Fund Manager to be below the minimum level for such Sub-Fund or such Class to be operated in an economically efficient manner (i.e., the Minimum Viable Size), or if a change in the economical or political situation relating to the Sub-Fund or Class concerned would have material adverse consequences on the investments of that Sub-Fund, or in order to proceed to an economic rationalisation of the Classes and/or the Sub-Funds offered, or for any other reason subject to compliance with the Funds Regulations, the Fund Manager may decide to compulsorily redeem all the Units of the relevant Class or Classes issued in such Sub-Fund at the Net Asset Value per Unit (taking into account actual realisation prices of investments and realisation expenses) calculated on the Valuation Day at which such decision shall take effect and therefore close such Class or Sub-Fund. The decision of the Fund Manager will be published (either in newspapers to be determined by the Fund Manager or by way of a notice sent to the Unitholders at their addresses indicated in the register of Unitholders) prior to the effective date of the compulsory redemption and such publication will indicate the reasons for, and the procedures of the compulsory redemption operations. Unless it is otherwise decided in the interests of, or to keep equal treatment between the Unitholders, the Unitholders of the Sub-Fund or Class concerned may continue to request redemption or conversion of their Units free of charge (but taking into account actual realisation prices of investments and realisation expenses) prior to the date effective for the compulsory redemption.
Notwithstanding the powers conferred to the Fund Manager by the preceding paragraph and subject to a prior approval from the Authority, the Unitholders of any one or all Classes of Units issued in any Sub-Fund may at a general meeting of such Unitholders, upon proposal from the Fund Manager, redeem all the Units of the relevant Class or Classes and the relevant Sub-Fund will refund to the Unitholders the Net Asset Value of their Units (taking into account actual realisation prices of investments and realisation expenses) calculated on the Valuation Day at which such decision shall take effect. There shall be no quorum requirements for such general meeting of Unitholders which shall decide by resolution taken by simple majority of the validly cast votes.
Thereafter, all redeemed Units shall be cancelled. The dissolution of the last Sub-Fund of the Fund will result in the liquidation of the Sub-Fund.
The Sub-Fund may further be dissolved by a Special Resolution of the General Meeting of Unitholders subject to the conditions and requirements of UAE law.
11. General Risk Considerations
11.1 Principal Risk Factors
Investment in any Sub-Fund carries with it a degree of risk, including, but not limited to, those referred to below. Potential investors should review the Prospectus in its entirety and the relevant Key Investor Information Document(s) and consult with their legal, tax and financial advisors prior to making a decision to invest.
There can be no assurance that the Sub-Funds will achieve their investment objectives and past performance should not be seen as a guide to future returns. An investment may also be affected by any changes in exchange control regulation, tax laws, withholding taxes and economic or monetary policies, and other factors beyond the control of the Fund Manager.
The following discussion of risk factors does not purport to be a complete or exhaustive explanation of the risks involved in investing in the Fund or any Sub-Fund.
Additional risk factors specific to a Sub-Fund are also set out in the Sub-Fund Supplement of that Sub-Fund.
1. Umbrella Fund and Segregation of Assets and Liabilities between Sub-Funds
The Fund is an umbrella fund with segregated liability between Sub-Funds to the largest extent permitted under the Funds Regulations and the laws of the UAE. The Fund generally will not be liable as a whole to third parties, and there will not be any potential for cross liability between the Sub-Funds. Notwithstanding the foregoing, there can be no assurance that, should an action be brought against the Fund or any Sub-Fund in the courts of the UAE or another jurisdiction, the segregated nature of the assets and liabilities of the Sub-Funds would be upheld.
2. Risk of Loss and Investment Discretion
Investing in any Sub-Fund involves a high degree of risk, including the potential for a complete loss of the investment. There is no guarantee or assurance that the investment strategy of any Sub-Fund will be successful or that any Sub-Fund will meet its investment objectives. Investors may experience a partial or total loss of their subscription proceeds. The Fund Manager (including its holding companies, subsidiaries, associates, or affiliates) and the Sub-Funds do not guarantee the investment or the returns.
The Fund Manager has significant discretion in allocating Assets, and all investments made by the Sub-Funds, including cash or cash equivalents, carry the risk of capital loss. There is no assurance that any Sub-Fund will identify suitable investment opportunities to deploy all its capital. Investment results can vary significantly over time and may deviate substantially from market returns. The possibility of partial or total capital loss exists, and prospective investors should not subscribe for Units unless they can bear such losses.
3. Risk Arising From Other Classes
Classes of Units will not be ring-fenced from one another. Creditors of a Sub-Fund are generally not obligated to satisfy their claims related to obligations specific to a particular Class solely from that Class. Instead, these creditors may generally seek to satisfy their claims from the overall assets of that Sub-Fund. Consequently, if a creditor’s claims related to a specific Class exceed the Net Asset Value attributed to that Class, the remaining capital of the Sub-Fund will be subject to such claims.
4. No Operating History
As newly established Fund and Sub-Funds, there is no operating history to consider. The success of the Sub-Funds’ trading and investment activities relies almost entirely on the capabilities of the Fund Manager.
5. Asset Allocation Risk
A Sub-Fund’s asset class selection and weighting may cause it to underperform compared to other funds with similar investment objectives.
6. Capital Erosion Risk
Management fees and other charges may be applied to the capital and income of the Sub-Fund(s). Investors may not receive the full amount of their original investment upon redemption of Units. The Net Asset Value calculation accounts for both realised and unrealised capital gains and losses.
7. Concentration Risk
At times, the Fund Manager may concentrate a Sub-Fund’s investments in a limited number of industries, issuers, regions, or strategies, making the Sub-Fund’s performance more susceptible to fluctuations in value or loss from adverse economic or business conditions affecting those industries, issuers, regions, or strategies. Therefore, investors should anticipate high volatility in such Sub-Fund’s performance.
8. Market Risk
There is no guarantee concerning the repayment of principal and the value of investments and the income derived therefrom may fall as well as rise and investors may not recoup the original amount invested in a Sub-Fund. In particular, the value of investments may be impacted by uncertainties such as international, political and economic developments or changes in government policies.
9. Emerging Markets
Due to the special risks associated with investing in Emerging Markets (such term as defined in the relevant Sub-Fund Supplement), the Sub-Funds which invest, directly or indirectly in such securities should be considered speculative. Investors in such Sub-Funds are advised to consider carefully the special risks of investing in Emerging Market securities. Economies in Emerging Markets generally are heavily dependent upon international trade and, accordingly, have been and may continue to be negatively impacted by trade barriers, exchange controls, managed adjustments in relative currency values and other protectionist measures imposed or negotiated by the countries with which they trade. These economies also have been and may continue to be affected adversely by economic conditions in the countries in which they trade.
Brokerage commissions, custodial services and other costs relating to investment in Emerging Markets generally are more expensive than those relating to investment in more developed markets. The lack of adequate custodial systems in some markets may restrict investment in a given country or may require a Sub-Fund to accept greater custodial risks in order to invest, although the relevant custodian/depositary bank will endeavour to minimise such risks through the appointment of correspondents that are international, reputable and creditworthy financial institutions. In addition, such markets have different settlement and clearance procedures. In certain markets there have been times when settlements have been unable to keep pace with the volume of securities transactions, making it difficult to conduct such transactions. The inability of a Sub-Fund to make intended securities purchases due to settlement problems could cause the Sub-Fund to miss attractive investment opportunities. Inability to dispose of a portfolio security caused by settlement problems could result either in losses to a Sub-Fund due to subsequent declines in value of the portfolio security or, if a Sub-Fund has entered into a contract to sell the security, could result in potential liability to the purchaser.
The risk also exists that an emergency situation may arise in one or more developing markets as a result of which trading of securities may cease or may be substantially curtailed and prices for a Sub-Fund’s securities in such markets may not be readily available.
Investors should note that changes in the political climate in Emerging Markets may lead to significant shifts in the attitude to the taxation of foreign investors. Such changes may result in changes to legislation, the interpretation of legislation, or the granting of foreign investors the benefit of tax exemptions or international tax treaties. The effect of such changes can be retrospective and can (if they occur) have an adverse impact on the investment return of Unitholders in any affected Sub-Fund.
10. Foreign Exchange Risk
Because a Sub-Fund’s assets and liabilities may be denominated in currencies different to the Base Currency, the Sub-Fund may be affected favourably or unfavourably by exchange control regulations or changes in the exchange rates between the Base Currency and other currencies. Changes in currency exchange rates may influence the value of a Sub-Fund’s Units, the dividends or interest earned and the gains and losses realised. Exchange rates between currencies are determined by supply and demand in the currency exchange markets, the international balance of payments, governmental intervention, speculation and other economic and political conditions.
If the currency in which a security is denominated appreciates against the Base Currency, the value of the security will increase. Conversely, a decline in the exchange rate of the currency would adversely affect the value of the security. Factors that may affect currency values include trade balances, interest rate levels, and political developments.
A Sub-Fund may engage in foreign currency transactions in order to hedge against currency exchange risk, however there is no guarantee that hedging or protection will be achieved. This strategy may also limit the Sub-Fund from benefiting from the performance of a Sub-Fund’s securities if the currency in which the securities held by the Sub-Fund are denominated rises against the Base Currency. In case of a hedged class, (denominated in a currency different from the Base Currency), this risk applies systematically. It is unlikely to be feasible to hedge all currency risks, and some foreign exchange risks may remain.
The Sub-Fund may furthermore incur costs related to currency conversions. Currency exchange dealers make a profit from the difference between buying and selling currency prices. A dealer typically offers to sell currency to the Sub-Fund at one rate and offers a lower rate for immediate resale.
11. Liquidity Risk
Liquidity risk exists within most financial products including the investments held by the Sub-Funds. Some securities and assets in which a Sub-Fund invests may not have an active market. Purchasing or selling certain assets may be impossible at the desired time or may require dealing at unfavourable prices or selling at a discount to perceived market value. This means that a delay may occur in receiving sales proceeds from the investments held by a Sub-Fund, and those proceeds may be less than recent valuations used to determine the Net Asset Value per Unit. This risk is greater in exceptional market conditions or when large numbers of investors are trying to sell their investments at the same time. In such circumstances, the receipt of sale proceeds may be delayed and/or take place at lower prices.
This may impact the ability of the Sub-Funds to immediately meet the redemption requests received from the Unitholders.
12. Volatility
The price of a financial derivative instrument can be very volatile. This is because a small movement in the price of the underlying security, index, interest rate or currency may cause a significant fluctuation in the price of the financial derivative instrument. Investment in financial derivative instruments may result in losses greater than the amount invested.
13. Possible Effects of Substantial Redemption
Significant redemptions of Units by Investors may require a Sub-Fund to liquidate investments more rapidly than desirable to raise necessary cash for redemptions, adversely affecting that Sub-Fund’s Net Asset Value. Limited liquidity in certain securities could make it difficult for the Sub-Fund to liquidate positions to satisfy redemption requests on favourable terms, thereby affecting the Net Asset Value.
14. Market Disruptions
The Sub-Funds may incur significant losses during disrupted markets and other extraordinary events where historical pricing relationships (on which the Fund Manager may base many trading positions) become materially distorted. The risk of loss from pricing distortions is compounded by the fact that, in disrupted markets, many positions become illiquid, making it difficult or impossible to close out positions against adverse market movements.
15. Inflation Risk
Inflation may undermine the real return on an investment in a Sub-Fund and may be difficult to predict in the jurisdiction of the Sub-Fund or of its investments.
16. Custodian and Broker Risks
Assets held by the Custodian, sub-custodians, brokers, or nominees on behalf of the Sub-Funds in various jurisdictions, including emerging markets, represent potential risks in terms of legal ownership structure and in case these entities face financial difficulties that impair the Sub-Funds’ operational capabilities or financial position. The Custodian, sub-custodians, brokers, and nominees are subject to various laws and regulations designed to protect customers in the event of insolvency. However, the practical effect of these laws and their application to the Sub-Funds’ Assets remain subject to substantial limitations and uncertainties.
17. Risks Related to Valuation of the Sub-Funds’ Assets
The Sub-Funds’ assets are generally valued based on quotes from exchanges, brokers, and other third-party sources, which may not reflect actual sale prices. The Sub-Funds may hold loans or privately placed securities with no public market.
Valuing certain asset classes, particularly hard-to-price assets like illiquid, unlisted, and unquoted securities, may result in subjective pricing that impacts the Net Asset Value of the Sub-Funds or Unit. The Administrator relies on prices provided by third-party sources, the Fund Manager, the Investment Manager, the Investment Adviser or other brokers/agents and does not perform independent verification, assuming no responsibility for any discrepancy between valuations provided and the actual sale or purchase prices of assets.
Valuations of assets undertaken or provided by the Sub-Funds will be conclusive and binding on all Investors.
18. Cyber Security Risk
Security breaches of computer systems used by the Fund Manager’s and the Fund’s service providers in respect of the Fund’s and Sub-Funds’ activities (such as the Investment Managers, the Investment Advisers, the Administrator, the Custodian and sub-custodians) have the potential to cause financial losses and costs for the Fund and the Sub-Funds, for example by disrupting or preventing trading or interfering with the administrative systems used in relation to the Fund and the Sub-Funds. While the Fund Manager’s and Fund’s service providers have established business continuity and disaster recovery plans and other systems and procedures to organise technical security to minimise the impact of attempted security breaches, investors must be aware that the risk of losses to the Fund and the Sub-Funds cannot be totally eliminated.
19. Operational Risk / Other Institutions May Fail
Institutions with which the Fund, the Sub-Funds and the Fund Manager conduct business or that provide services to the Fund, the Sub-Funds or the Fund Manager, either directly or indirectly, may encounter financial difficulties that could impair the operational capabilities or the financial position of the Fund, the Sub-Funds or the Fund Manager.
For example, in the event of a bankruptcy or insolvency of a service provider, investors could experience delays (for example, delays in the processing of subscriptions, conversions and redemption of Units) or other disruptions.
20. Pandemic Risk
An outbreak of an infectious disease, pandemic or any other serious public health concern could occur in any jurisdiction in which a Sub-Fund may invest, leading to changes in regional and global economic conditions and cycles which may have a negative impact on the Sub-Fund’s investments and consequently its Net Asset Value. Any such outbreak may adversely affect the wider global economy and/or markets which may negatively impact a Sub-Fund’s investments more generally. Additionally, a serious outbreak of infectious disease may also be considered a force majeure event under contracts that the Fund or Fund Manager has entered into with counterparties thereby relieving a counterparty of the timely performance of the services such counterparties have contracted to provide to the Sub-Funds (the nature of the services will vary depending on the agreement in question). In a worst case scenario, this may result with the Sub-Funds being delayed in calculating their Net Asset Value, processing dealing in Units, undertaking independent valuations of the Sub-Funds or executing trades in respect of the Sub-Funds.
21. Terrorism / Military Risk
Terrorist attacks have caused instability in global financial markets and may generate economic instability globally. The threat of terrorism and the impact of actual or potential military or other actions can result in increased volatility in supply, demand, and/or prices for electricity, ethanol/biodiesel, coal, oil and gas, construction materials, land, and housing, potentially affecting the Fund’s and Sub-Funds’ operations, Net Asset Value, performance, and financial results. Such events may impede the Fund’s and Sub-Funds’ ability to obtain insurance coverage and other endorsements at commercially reasonable prices or at all. A terrorist attack or potential military action may result in liabilities far exceeding available insurance coverage, with adverse consequences for the Fund and the Sub-Funds. Even if insurance is obtained, there is no guarantee that the insurer will not dispute the classification of the pay-out.
22. Effects of Catastrophic Events
Catastrophic events like natural disasters, war, civil disturbance, terrorism, power outages, and other unforeseeable events, may disrupt markets and interrupt expected events, adversely affecting the Fund’s and Sub-Funds’ operations and investments. Public response to or fear of such crises or events may also have adverse effects. Preventative or protective actions by governments in response to such crises or events may disrupt the Fund’s and Sub-Funds’ operations, the Fund Manager, and service providers. The duration and impact of such crises or events could adversely affect economies and financial markets locally or globally, leading to negative consequences for the Fund and the Sub-Funds, including significant reduction in Net Asset Value, reduced investment liquidity, valuation restrictions, and potential suspension of Net Asset Value calculation and capital commitments.
23. Changes in Applicable Law
The Fund and Sub-Funds must comply with various legal requirements, including securities and tax laws, imposed by jurisdictions where the Fund and Sub-Funds are registered/invested. Alterations in these laws over the Fund’s and Sub-Funds’ life could materially alter the legal requirements for the Fund, the Sub-Funds and the Unitholders.
24. Sustainability Risk
Sustainability risk, encompassing environmental, social, or governance events or conditions, could negatively impact the value of the Sub-Funds’ investments. This risk is linked to climate-related events from climate change (physical risks) or societal responses to climate change (transition risks), potentially resulting in unanticipated losses affecting investments and financial condition. Social factors (e.g., inequality, labour relations, customer behaviour changes) or governance issues (e.g., significant breaches of international agreements, bribery, product safety) may also pose sustainability risks.
25. Legal Risk
There is a risk that it may not be possible to enforce agreements entered into by or on behalf of the Fund and/or a Sub-Fund due to bankruptcy or a dispute as to the interpretation of the agreement. There is also a risk that legal agreements in respect of certain derivative transactions and securities lending transactions entered into by or on behalf of the Fund and/or a Sub-Fund may be terminated due, for instance, to bankruptcy of the counterparty or a change in tax law. As a result, the Sub-Fund may incur a loss as a result.
26. Legal and Regulatory Risk Relating to Investments
Many of the laws that govern private and foreign investment, equity or derivatives transactions, and other contractual relationships in emerging countries are new and/or largely untested, posing unusual risks, including inadequate investor protection, contradictory legislation, incomplete and changing laws, regulatory ignorance or breaches by market participants, lack of established legal redress avenues, non-standard practices, confidentiality customs, and inadequate regulation enforcement. It may be difficult to obtain and enforce judgments in certain countries where the Assets of the Sub-Funds are invested, potentially adversely affecting the Sub-Funds. Regulatory controls and corporate governance in emerging markets often provide limited protection to minority unitholders. Anti-fraud and anti-insider trading legislation are often rudimentary. The Sub-Funds’ investment opportunities in some emerging markets may be restricted by foreign investment limits in local securities.
27. Risks Associated with Government or Central Banks’ Intervention
Changes in regulation or government policy leading to intervention in the currency and interest rate markets (e.g., restrictions on capital flows or changes to the way in which a national currency is supported such as currency de-pegging) may adversely affect some financial instruments and the performance of the Sub-Funds.
28. Shariah Compliance
Certain Sub-Funds of the Fund may aim to invest in accordance with generally accepted Shariah compliant principles as per AAOIFI Shariah Standards and guidance of the Shariah Supervisory Committee. Such investment policy may restrict the investable universe of the Fund Manager and/or the Investment Manager (if any) which may, in turn, constrain returns. Additionally, should an asset be deemed non-compliant, or transitions from a compliant to a non-compliant status, cleansing of the relevant Sub-Fund’s assets may be required. This may dilute returns when compared to a conventional counterpart.
In the case where an asset moves from a compliant to a non-compliant status, the Fund Manager and/or the Investment Manager (if any) will within a reasonable timeframe sell such non-compliant asset and use its best endeavours to replace the aforementioned assets with new Shariah compliant assets. In the case where a capital gain is realised by selling such asset, such capital gain will be purified in accordance with the Shariah Supervisory Committee’s guidance on the appropriate methodology to do so and on the allocation of the purification proceeds among charities. A charity will be designated from time to time by the Shariah Supervisory Committee for purification purposes, with the prior approval of the Fund Manager.
Shariah compliant Sub-Fund(s) must at all times adhere to applicable UAE laws and regulations and in case of discrepancies between UAE laws and regulations and Shariah principles, UAE laws and regulations shall prevail to the extent they do not violate the principles of Islamic Shariah.
Additionally, by investing in Shariah Compliant Sub-Funds, Unitholders agree to waive the receipt of any payments of any applicable interests that are contrary to the principles of Islamic Shariah.
29. Conflicts of Interest May Arise
The Fund Manager may face various conflicts of interest. See Section 12 (Conflicts of Interest) below.
30. Tax considerations
Each of the Sub-Fund(s) and any underlying fund (each a “Relevant Entity”) may be subject to withholding, capital gains or other taxes on income and/or gains arising from its investment portfolio, including, without limitation, taxes imposed by the jurisdiction in which the issuer of securities held by the Relevant Entity is incorporated, established or resident for tax purposes. A Relevant Entity may also incur or bear transaction or other similar taxes in respect of the actual or notional amount of any acquisition, disposal or transaction relating to its investment portfolio, including without limitation taxes imposed by the jurisdiction in which the issuer of securities held by the Relevant Entity or their respective counterparties to a transaction involving the Relevant Entity is or are incorporated, established or resident for tax purposes. Where a Relevant Entity invests in securities or enters into transactions that are not subject to withholding, capital gains, transaction or other taxes at the time of acquisition, there can be no assurance that tax may not be withheld or imposed in the future as a result of any change in applicable laws, treaties, rules or regulations or the interpretation thereof. The Relevant Entity may not be able to recover such tax which could adversely affect the Net Asset Value per Unit.
Where a Relevant Entity chooses or is required to pay taxation liabilities and/or account for reserves in respect of taxes that are or may be payable in respect of current or prior periods by a Relevant Entity (whether in accordance with current or future accounting standards), this would have a negative impact on the Net Asset Value per Unit. This could cause benefits or detriments to certain Unitholders, depending on the timing of their entry to and exit from the relevant Sub-Fund.
11.2 Risks Associated with Feeder Funds
Certain Sub-Funds of the Fund may seek to invest substantially all of their assets in a master fund (the “Master Fund”), following a Feeder Fund investment strategy. Prospective investors must carefully consider the following risk factors before investing in a Feeder Fund:
1. Master Fund Risk Factors
An investment in a Feeder Fund will involve substantially the same risks as an investment in the underlying Master Fund. For more detailed information about these risks, please see the relevant Master Fund prospectus, including the risks factors outlined therein. Each prospective investor should carefully review the Master Fund prospectus and the other material documents in relation to the Master Fund with the prospective investor’s legal, accounting, business, investment, pension, and tax advisors before subscribing for Units in a Feeder Fund. These documents are available upon request to the Fund Manager.
2. Costs and Expenses of Master Funds
An investment in a Feeder Fund is not the same as a direct investment in the underlying Master Fund. Please also see “Difference of Performance between a Feeder Fund and a Master Fund” below. The references to the Master Fund prospectus and other information about the Master Fund herein are not an offering of units in the Master Fund but are intended to provide important information related to an investment in the Feeder Fund, which will in turn invest substantially all of its assets in the Master Fund.
As a unitholder in the Master Fund, the Feeder Fund will be subject to the terms of the Master Fund, including, but not limited to, bearing its pro rata portion of the fees and expense reimbursements of the Master Fund. For more information, please consult the relevant fees and expenses descriptions in the Master Fund prospectus.
3. Difference of Performance between a Feeder Fund and a Master Fund
The returns of a Feeder Fund are heavily dependent on the performance of its investment in the Master Fund, and there is no guarantee that the Master Fund will successfully implement its investment objective and strategy. Although the Feeder Fund invests nearly all of its assets in the Master Fund, its performance will not be identical to the returns achieved by the Master Fund.
In addition to those expenses incurred by the Feeder Fund as an investor in the Master Fund (such as the Master Fund’s management fees, organisational expenses, investment expenses, operating expenses, and other expenses and liabilities), the Feeder Fund will also incur its own organisational and operating expenses and other expenses and fees. These additional expenses will diminish the Feeder Fund’s performance relative to the Master Fund, leading to deviations between the performance of the Feeder Fund and the Master Fund over time.
4. Lack of Diversification
A Feeder Fund intends to invest all or substantially all of its assets in a Master Fund. Consequently, the assets of a Feeder Fund are exposed to a higher risk of loss than if they were more widely diversified. Poor performance of a Master Fund will directly result in poor performance of its Feeder Fund.
5. Exercise of Rights of a Feeder Fund in a Master Fund
A Feeder Fund does not own portfolio investments directly but is an investor in the Master Fund. Subscriptions and repurchases by Unitholders in a Feeder Fund depend on the Feeder Fund’s ability to effect corresponding subscriptions and redemptions with the Master Fund. The rights of a Feeder Fund as investor in the Master Fund are generally exercised by the Fund Manager and are governed by the jurisdiction of organisation of the Master Fund, but such rights are restricted and less effective as if the Feeder Fund invested directly in portfolio investments.
6. No Direct Claim Rights against a Master Fund
Although the Feeder Fund will be an investor in the Master Fund, Unitholders in the Feeder Fund will not have investor status of the Master Fund and will not be entitled to enforce any rights directly against the Master Fund and the Master Fund manager, or assert claims directly against the Master Fund, the Master Fund manager or their affiliates.
7. Changes of Terms of a Master Fund
The terms of a Master Fund are subject to change. There can be no assurances that the management and/or investors in the Master Fund will not further amend the Master Fund prospectus or the other governing documents of the Master Fund. A Feeder Fund lacks the authority to unilaterally block any amendment of the Master Fund prospectus or other Master Fund’s governing documents. Consequently, neither a Feeder Fund nor the Fund Manager will have any liability or responsibility to any Unitholders for any changes to the terms of the Master Fund.
12. Conflicts of Interest
There are potential conflicts of interest which may arise between the Fund and Sub-Funds and the Fund Manager. The Fund Manager may manage assets of other clients that make investments similar to those made on behalf of a Sub-Fund, potentially competing for the same trades or investments. Whilst available investments or opportunities are generally allocated to each client in a manner believed to be equitable, some allocation procedures may adversely affect the price paid or received for investments or the size of positions obtained or disposed of.
Additionally, the Fund Manager, any specific Sub-Fund Investment Manager and/or Investment Adviser, sales agents, the Administrator, or the Custodian may also act as fund manager, investment manager and/or adviser, sales agent, administrator, or custodian for other funds or collective investment schemes with similar investment objectives to those of the Fund or any Sub-Fund. Consequently, potential conflicts of interest may arise in the course of their business with the Fund or any Sub-Fund.
A Sub-Fund may also invest in other collective investment schemes which are managed by the Fund Manager, Investment Managers and/or Investment Advisers of the Fund or a Sub-Fund. Generally, there may be conflicts between the best interests of the Fund and Sub-Funds and the interests of affiliates of the Fund Manager in connection with the fees, commissions and other revenues derived from the Fund and Sub-Funds or the collective investment schemes. In the event that such a conflict arises, the Fund Manager will endeavour to ensure that it is resolved in a fair manner.
There is no prohibition on the Fund entering into any transactions with the Fund Manager or any specific Sub-Fund Investment Manager and/or Investment Adviser, the sales agents, the Administrator, the Custodian or with any of their affiliates, or investing the assets of or reinvest the cash collateral received by any Sub-Fund in any investment products or funds managed, launched or offered by any of the above-mentioned entities, provided that such transactions are carried out as if effected on normal commercial terms negotiated at arm’s length.
The Related Parties may invest for their own account in a Sub-Fund, provided that (i) they may not have rights or conditions better than the rights of the other Unitholders of the same Class and (ii) they shall refrain from voting on the matters where they have interests.
As of the date of this Prospectus, the Fund Manager has not invested in its own name in the Sub-Funds, except to the extent that it invests by way of Seed Capital to launch a Sub-Fund or in respect of the transfer of Units for the purpose of the Top-Up Feature transfer mechanism.
Any Related Party Transaction should be done in accordance with the Funds Regulations. As required pursuant to the Funds Regulations, the Fund Manager will ensure prior disclosure to the Unitholders of the Fund or of the relevant Sub-Fund, as applicable, of the details of any Related Party Transaction. Such disclosure of a Related Party Transaction will be made available through the website of the Fund Manager (www.kelvin-dev.click) or via direct notice to Unitholders as soon as practicable.
The above is not necessarily a comprehensive list of all potential conflicts of interest.
13. Tax Disclosures
The following is based on the Fund’s understanding of certain limited aspects of taxation law and practice currently in force in the UAE. There can be no guarantee that the tax position or proposed tax position at the date of this Prospectus or at the time of an investment will endure indefinitely.
13.1 UAE
Taxation of the Sub-Funds
The Fund Manager intends to apply to the UAE Federal Tax Authority (the “FTA”) for each Sub-Fund to obtain exemption from UAE Corporate Tax as a Qualifying Investment Fund (the “QIF Exemption”).
The intention is that each Sub-Fund will obtain and maintain the QIF Exemption. Where a Sub-Fund does not meet the relevant requirements to utilise the QIF Exemption, such Sub-Fund will be subject to UAE Corporate Tax at the prevailing rate on its taxable income (including any income or capital gain which it receives in respect of its investments, but subject to any other available UAE Corporate Tax exemptions) arising over and above the first AED 375,000 of taxable income received by such Sub-Fund in each financial year, or as may otherwise be applicable under UAE taxation regulations. In these circumstances, such UAE Corporate Tax will detrimentally impact the Net Asset Value and applicable redemption price of the Units held by Unitholders.
Where a Sub-Fund meets the requirements for the QIF Exemption, Unitholders of such Sub-Fund who are taxable persons for UAE Corporate Tax purposes are required to include their proportional share of the net income of the Sub-Fund available for distribution, as stated in the Sub-Fund’s financial statements for the particular financial year, in their own income calculations for UAE Corporate Tax purposes.
The Fund Manager may apply to the FTA to register each Sub-Fund for VAT purposes where the Sub-Fund meets the mandatory registration threshold for UAE VAT. VAT incurred by the Sub-Fund on expenses may not be recoverable, or may only be partially recoverable, depending on the exact nature of the relevant chargeable supplies received and made by the Sub-Fund. Consequently, where any such VAT cost is not recoverable it will become a cost of the relevant Sub-Fund.
Investing in a Sub-Fund could result in UAE Corporate Tax obligations for certain Unitholders, depending on their circumstances. The application of the UAE Corporate Tax is complex and it is recommended that prospective investors seek independent UAE tax advice to determine their tax obligations prior to investing in the Fund or any Sub-Fund thereof.
13.2 Automatic exchange of information
The UAE has signed a Model 1 inter-governmental agreement with the United States (the “US-UAE IGA”) to give effect to FATCA. Pursuant to the US-UAE IGA and the related UAE legislation, regulations and guidance, each Sub-Fund is required to report certain information about “Specified U.S. Persons” (as defined in the US-UAE IGA) that own, directly or indirectly, an interest in the relevant Sub-Fund. If the relevant Sub-Fund does not comply with these obligations, it may be subject to a 30 per cent (30%) withholding tax on certain payments to it of US source income (including interest and dividends) (a “FATCA Deduction”), and to financial penalties or other sanctions under the relevant UAE legislation.
Under the terms of the current US-UAE IGA, the Sub-Funds will generally not be required to withhold tax on payments made to an account holder (i.e. a Unitholder) or to close recalcitrant accounts. The relevant Sub-Fund will be required to report certain information in respect of any “Specified U.S. Persons” to the relevant authority and that authority will exchange this information, on an automatic basis annually, with the US Internal Revenue Service.
A number of other jurisdictions have entered into or are committed to entering into inter-governmental agreements for the automatic cross-border exchange of tax information similar to the US-UAE IGA, including, in particular, under the CRS. The UAE has signed, along with over 100 other countries, a multilateral competent authority agreement to implement the CRS, and have issued regulations and guidance to give effect to the CRS. These regulations require UAE “Financial Institutions”, including each Sub-Fund, to identify specified persons in participating jurisdictions under the CRS, and to report related information to the relevant authority (for automatic exchange with the relevant tax authorities in such jurisdictions). Each Sub-Fund may be subject to financial penalties or other sanctions if they fail to comply with the requirements of the UAE regulations giving effect to the CRS.
While each Sub-Fund will seek to satisfy its obligations under FATCA, the US-UAE IGA, the CRS and the associated implementing legislation in the UAE to avoid the imposition of any FATCA Deductions, financial penalties and other sanctions, the ability of each Sub-Fund to satisfy such obligations will depend on receiving relevant information and/or documentation about each Unitholder and the direct and indirect beneficial owners of the Units (if any). There can be no assurance that each Sub-Fund will be able to satisfy such obligations. If a Unitholder, or any related party, causes a Sub-Fund to suffer a FATCA Deduction, financial penalty, or other cost, expense or liability, or the relevant Sub-Fund is required to make a FATCA Deduction from such Unitholder, the relevant Sub-Fund may take any action available to it to ensure that the FATCA Deduction or financial penalty and other associated costs, expenses and liabilities are economically borne by such Unitholder. Such action may (without limitation) include the compulsory redemption of some or all of the Units held by such Unitholder.
All prospective investors should consult with their own tax advisers regarding the possible implications of FATCA, the US-UAE IGA, the CRS and the associated implementing legislation in the UAE and any other similar legislation and/or regulations on their investments in the relevant Sub-Fund.
13.3 General
The receipt of dividends (if any) by Unitholders, the redemption, exchange, conversion or transfer of Units and any distribution on a winding-up of any Sub-Fund may result in a tax liability for the Unitholders according to the tax regime applicable in their various countries of residence, citizenship or domicile. Unitholders resident in or citizens of certain countries which have anti-offshore fund legislation may have a current liability to tax on the undistributed income and gains of the relevant Sub-Fund. The Fund Manager, the Fund, each Sub-Fund and each of the Fund’s agents shall have no liability in respect of the individual tax affairs of Unitholders.
Despite anything else herein contained and as far as permitted by UAE law, the Fund shall have the right to:
- withhold any taxes or similar charges that it is legally required to withhold, whether by law or otherwise, in respect of any holdings in the Fund;
- require any Unitholder or beneficial owner of the Units to promptly furnish such personal data as may be required by the Fund in its discretion in order to comply with any law and/or to promptly determine the amount of withholding to be retained;
- divulge any such personal information to any tax or regulatory authority, as may be required by law or such authority; and
- withhold the payment of any dividend or redemption proceeds to a Unitholder until the Fund holds sufficient information to enable it to determine the correct amount to be withheld.
Sub-Fund Supplements
List of Available Sub-Funds
- Chocolate Global Funds – Chocolate Global Income Fund
Chocolate Global Funds – Chocolate Global Income Fund
Initial Offer Price per Unit:
- Classes of Units A1 and A2: USD 1
- Classes of Units B1 and B2: AED 1
Minimum Viable Size: USD 1,000,000\ Maximum Fund Size: No maximum
First Initial Offering Period Commencement Date: 21 August 2026\ First Initial Offering Period Expiry Date: 27 August 2026
In the event the Minimum Viable Size is not reached during the First Initial Offering Period:
Second Initial Offering Period Commencement Date: 31 August 2026\ Second Initial Offering Period Expiry Date: 4 September 2026
Fund Manager\ Chocolate Finance for Managing Investments of Investment Funds - L.L.C - S.P.C\ Level 17, World Trade Centre, Al Danah\ Abu Dhabi, United Arab Emirates
Custodian\ Standard Chartered Bank (UAE Branch)\ Standard Chartered Tower\ Level 12, Emaar Square\ Downtown, P.O. Box 999\ Dubai, United Arab Emirates
Fund Administrator\ Standard Chartered Bank (UAE Branch)\ Standard Chartered Tower\ Level 12, Emaar Square\ Downtown, P.O. Box 999\ Dubai, United Arab Emirates
Registrar and Transfer Agent\ Chocolate Finance for Managing Investments of Investment Funds - L.L.C - S.P.C\ Level 17, World Trade Centre, Al Danah\ Abu Dhabi, United Arab Emirates
Auditor\ Grant Thornton Audit and Accounting Limited - Abu Dhabi\ Al Kamala Tower Office 1101, 11th Floor\ Zayed the 1st Street\ Abu Dhabi\ United Arab Emirates
Subscription Bank\ Standard Chartered Bank (UAE Branch)\ Standard Chartered Tower\ Level 12, Emaar Square\ Downtown, P.O. Box 999\ Dubai, United Arab Emirates
Legal Counsel\ Simmons & Simmons Middle East LLP\ ICD Brookfield Place, 17th Floor\ Dubai International Financial Centre\ Dubai, United Arab Emirates
Global Distributor\ Chocolate Finance for Managing Investments of Investment Funds - L.L.C - S.P.C\ Level 17, World Trade Centre, Al Danah\ Abu Dhabi, United Arab Emirates
Specialist Class of Sub-Fund: Securities Investment Fund
Shariah Compliance: No
1. Type of Sub-Fund
The Sub-Fund is an Open-ended Public Fund.
2. Investment Strategy and Objective
The Sub-Fund's investment objective is to deliver a target income return in various currencies by investing primarily in a diverse range of financial instruments, including debt obligations, dividend stocks, foreign exchange, and interest rate markets.
The investment strategy of the Sub-Fund is to invest directly or indirectly in the following:
- short-term debt obligations, including but not limited to, commercial paper, certificates of deposit, time deposits, deposit notes, discount notes and banker’s acceptances;
- treasury and government-related securities, including but not limited to securities issued by sovereigns, government agencies or instrumentalities, government-related entities, regional government entities or supranational organizations;
- fixed, variable and floating-rate debt securities;
- corporate securities, including but not limited to securities issued by corporations and other business entities;
- foreign exchange spot, forward contracts and derivatives for the purposes of hedging or for purchase or sale of currencies to facilitate the settlement of trades, or to exchange one currency for another, including to repatriate foreign currency;
- currency hedging instruments (recognizing that, in regard to currency hedging, it is generally not possible to precisely match the foreign currency exposure of the foreign currency forward contracts to the value of the securities involved due to fluctuations in the market values of such securities between the date a foreign currency forward contract is entered into and the date it expires; alternatively, some or all of the currency exposure may remain unhedged at the discretion of the Fund Manager);
- any security received or purchased in relation to a corporate action;
- shares, units or interests in money market funds or other short-term investment funds, including without limitation UCITS or ETFs (which may be managed by an affiliate of the Fund Manager);
- reverse repurchase of exchange listed securities or over-the-counter securities;
- cash and cash equivalents.
In addition, to mitigate potential adverse movements in interest rates that could negatively impact the value of its portfolio assets, the Sub-Fund is allowed to enter into hedging instruments and strategies including, but not limited to:
- Interest Rates Swaps;
- Futures and Options on Interest Rates;
- Forward Rate Agreements;
- Interest Rate Caps and Floors.
3. Sub-Fund Investment Restrictions
The Sub-Fund qualifies as a Securities Investment Fund under the Funds Regulations. A Securities Investment Fund is a fund whose investment policy is to invest in securities and/or foreign securities listed in the local market and eligible foreign markets. A foreign market is considered to be eligible for investments by a Securities Investment Fund if it is established outside the United Arab Emirates and is subject to a regulatory authority similar to the Authority.
The Investments of a Securities Investment Fund under the Funds Regulations are limited to the following:
- Investments in traded securities;
- Investing in financial derivatives of tradable securities to account for risk appetite as specified in the offering document or for hedging purposes provided that full disclosure is made;
- Investing in time deposits and money market transactions with a maturity of (12) months as a maximum, with licensed banks;
- Investing in money markets and exchange traded funds, or in bank deposits, to ensure the level of liquidity; and
- Investing in units of public securities investment funds, provided that the investment percentage is specified, and that they are licensed by the Authority or a regulatory authority similar to the Authority.
In addition, the Fund Manager shall comply with the following in respect of a Sub-Fund qualifying as Securities Investment Fund under the Funds Regulations:
- Refrain from investing the assets and money of the Sub-Fund in securities issued by the Fund Manager itself or any of its parent, holding, subsidiary or sister companies, unless otherwise permitted and stated in the investment policy and the Prospectus;
- Not invest in debt instruments that are not credit-rated. The credit rating of the invested debt instruments shall not be less than investment grade;
- Not borrow or enter into transactions that entail contractual obligations of more than (10%) of the total value of the Sub-Fund’s assets;
- The percentage of investment in securities issued by a single issuer shall not exceed (10%) of the total value of the Sub-Fund’s assets. The aggregate value of the investments that exceed 5% of the total value of the Sub-Funds’ assets shall be capped at exceed (40%) of the Sub-Fund’s total assets;
- The percentage of investment in all securities of one issuer shall not exceed (20%) of the total value of the Sub-Fund’s assets;
- The percentage of investment in the unlisted securities shall not exceed (10%) of the total value of the Sub-Fund’s assets;
- The total of the Sub-Fund’s investments in different entities belonging to the same parent, holding, subsidiary or sister company shall not exceed (25%) of the total value of the Sub-Fund’s assets;
- The percentage of investment in the financial derivatives shall not exceed (15%) of the total value of the Sub-Fund’s assets;
- The percentage of investment in a public exchange traded fund shall not exceed (40%) of the total value of the Sub-Fund’s assets;
- Investment in foreign securities must be made in listed investments on major active foreign markets subject to the supervision of a regulatory authority similar to the Authority and to be approved by the Authority;
- Subject to the Sub-Fund’s investment policy, investing in securities funds or other public money market funds, must not exceed (25%) of the total value of its assets, along with the following:
- The total value of investments in those funds shall not exceed (20%) of the total value of the Sub-Fund’s assets; and
- The investment in one fund shall not exceed (10%) as a maximum of the total value of the Sub-Fund’s assets; and
- The following shall be excluded from the above percentages:
- Debt instruments issued by local government authorities not exceeding (35%) of the total value of the Sub-Fund’s assets;
- Investing in debt instruments denominated in the Sub-Fund’s Base Currency and issued by non-local sovereign authorities, provided that the investment therein does not exceed (25%) of the net value of the Sub-Fund’s assets; and
- Investing more than (10%) of the net value of the Sub-Fund’s assets in one class of debt instruments listed in a major market and issued by one issuer, provided that the investment therein does not exceed (20%) of the net value of the Sub-Fund’s assets.
4. Investment Markets of the Sub-Fund
The Sub-Fund will invest globally.
5. Investment Adviser
The Fund Manager has appointed Insight Investment Management (Global) Limited as its investment adviser in respect of the Sub-Fund (the “Investment Adviser”). The Investment Adviser is a company incorporated in England and Wales (registered number 00827982), having its principal place of business at 160 Queen Victoria St, London, EC4V 4LA, United Kingdom, and is authorised and regulated by the United Kingdom Financial Conduct Authority (FCA) (No. 119308).
The Investment Adviser is the largest investment house wholly owned by BNY and specializes in fixed income investment management services. This includes managing assets on behalf of institutional clients such as pension funds, insurance companies, and other large investors.
In accordance with the Investment Advisory Agreement, the Investment Adviser will provide investment advice to the Fund Manager in respect of the Sub-Fund in accordance with the investment objective and strategy of the Sub-Fund as set out herein, and will execute investment decisions and provide hedging services strictly upon the instruction of the Fund Manager.
The Fund Manager will pay an Investment Advisory Fee (out of the Management Fee) of up to 0.12% of the Sub-Fund’s assets under management per annum to the Investment Adviser.
6. Typical Investor’s Profile
The Sub-Fund may be suitable for investors seeking a medium to long term capital appreciation from investment over a period of 3 to 5 years.
7. Leverage/Borrowing
The Sub-Fund will not use leverage, except for hedging purposes.
8. Base Currency of the Sub-Fund
The Base Currency of the Sub-Fund is the U.S. Dollar.
9. Minimum Viable Size
The Minimum Viable Size of the Sub-Fund is of at least USD 1,000,000 to be reached before the end of the Initial Offering Period.
10. Classes of Units
The Sub-Fund issues Units in several separate Classes of Units. Such Classes of Units may differ with respect to the type of investors for which they are designed and, as the case may be, with respect to their fee structure.
The following Classes of Units are available for investment, subject to the minimum initial and subsequent subscription amounts and minimum holding amounts indicated below.
Certain Classes of Units are also subject to a maximum investment amount per investor (the “Maximum Investment Amount per Investor”), as determined by the Fund Manager and indicated below. Where an investor’s intended subscription amount exceeds the Maximum Investment Amount per Investor applicable to a given Class of Units, any excess subscription amount shall, unless otherwise determined by the Fund Manager, be automatically allocated to the next available Class of Units in accordance with the investment cascade established for the Sub-Fund as set out in the below table.
As Class A1 and Class B1 are subject to a Maximum Investment Amount per Investor of USD 25,000 and AED 100,000, respectively, where the value of a Unitholder’s Units in Class A1 or Class B1 exceeds the applicable Maximum Investment Amount per Investor, the Fund Manager may, in its discretion, redeem or convert such excess Units into Units of Class A2 or Class B2, as applicable.
Conversely, where the value of a Unitholder’s Units in Class A1 or Class B1 falls below the applicable Maximum Investment Amount per Investor, the Fund Manager may, in its discretion, redeem or convert available Units of Class A2 or Class B2 (as applicable) in order to reallocate such Units into Class A1 or Class B1, up to the relevant Maximum Investment Amount per Investor.
11. Initial Offering Period
The Initial Offering Period of the Sub-Fund, during which Units will be issued at a fixed price of (i) USD 1 per Unit for the Classes of Units A1 and A2 and (ii) AED 1 for the Classes of Units B1 and B2, will begin on 21 August 2026 and end on 27 August 2026. If the Minimum Viable Size is not reached during this Initial Offering Period, and at the full discretion of the Fund Manager, a Second Offering Period may begin on 31 August 2026 and end on 4 September 2026.
The Initial Subscription Day of the Sub-Fund is the Business Day following the end of the Initial Offering Period.
Applications as per Section 4.2(D) of the Prospectus must be received via the Digital Platform or by any other agreed means of communication as may be notified by the Fund Manager, by the Cut-Off Time of three (3) Business Days before the end of the Initial Offering Period.
Applications which are received, or completed, after the above-mentioned Cut-Off Time, will be dealt with on the next following Subscription Day at the Subscription Price.
12. Subscriptions
The Sub-Fund is characterised as being subscription-based, in accordance with Section 4.2(F)(1).
The Subscription Day and the Cut-Off Time for subscriptions in this Sub-Fund are as follows:
Applications received, or completed, after the above-mentioned Cut-Off Time, will be dealt with on the next following Subscription Day.
The Subscription Price will be the prevailing Net Asset Value per Unit applicable on such Subscription Day.
Investors should note that they will not know the actual purchase price of their Units until their order has been completed.
13. Redemption and Conversion
The Sub-Fund is Open-ended and Unitholders may request the redemption of some or all of the Units they hold in the Sub-Fund in accordance with Section 4.4 of the Prospectus.
However, redemptions will be processed in accordance with the redemption cascade applicable to the Sub-Fund. Under this cascade, redemption requests will be satisfied in the following order:
(i) first from the investor’s holdings in Class A2 or B2, as applicable, until such holdings are fully redeemed; and
(ii) thereafter from the investor’s holdings in Class A1 or B1, as applicable.
This redemption order will apply irrespective of the Class of Units indicated in the Redemption Notice.
The Redemption Day, Conversion Day and the Cut-Off Time for redemptions and conversions in the Sub-Fund are as follows:
Redemption requests received after the above-mentioned Cut-Off Time will be dealt with on the basis of the Net Asset Value per Unit on the next Redemption Day.
The Sub-Fund will pay the Unitholder redemption proceeds normally within three (3) Business Days after the relevant Redemption Day, unless exceptional circumstances arise, in which case the payment shall be made as soon as reasonably practicable thereafter.
Special Redemption Request
Unitholders holding Units in Class B1 and Class B2 may submit Special Redemption Requests, provided that the applicable daily threshold (the “Special Redemption Threshold”) as determined by the Fund Manager, has not been exceeded.
The Special Redemption Threshold shall be the lower of:
- AED 50,000 per Unitholder; and
II. up to 5% of the Sub-Fund’s assets under management.
Special Redemption Requests are not available in respect of Units in Class A1 or Class A2.
Transfer and Conversion
Transfer requests are dealt with in accordance with Section 4.3 of the Prospectus
Conversion
Conversion requests are dealt with in accordance with Section 4.6 of the Prospectus.
However, for this Sub-Fund, conversions are permitted only between Classes of the Sub-Fund denominated in different currencies (for example, from USD-denominated Classes to AED-denominated Classes and vice versa). Allocation to a specific Class of Units within the USD-denominated or AED-denominated Classes is determined by the amount invested in the relevant currency and is subject to the investment cascade established for the Sub-Fund as set out under paragraph 10 above. Where a conversion is effected in respect of part of a Unitholder’s holding, such conversion is processed on a last-in, first-out (LIFO) basis, meaning that the most recently subscribed Units are converted first.
14. Fees
14.1 Management Fee
The Management Fee shall be calculated on the Net Asset Value of the Sub-Fund or Class of Units, accrued daily and paid quarterly in arrears, or at such other intervals or for such other periods as the Fund Manager may determine. The applicable rates are as follows:
14.2 Performance Fee
The Fund Manager shall receive a performance fee (the “Performance Fee”), payable out of the assets of the Sub-Fund, as follows:
The Performance Fee, in respect of the Units, will accrue daily on each Valuation Day, and crystallise on the final Valuation Day of each Crystallisation Period.
The Performance Fee shall be calculated on a Class by Class basis as the amount (whether positive or negative) equal to (i) the Net Asset Value per Unit of the relevant Class at the Valuation Point on the relevant Valuation Day, after deduction of any Management Fee accrued for that Valuation Day, less (ii) the Net Asset Value per Unit of that Class at the Valuation Point on the immediately preceding Valuation Day, after deduction of any Management Fee accrued for that Valuation Day, less (iii) the product of the Net Asset Value per Unit referred to in (ii) above and the Chocolate Rate for that Class, divided by the Gregorian calendar days for the year.
Upon crystallisation, if the aggregate of all daily accruals for the relevant Crystallisation Period is positive, the Fund Manager shall be entitled to be paid, out of the assets of the relevant Class, a Performance Fee equal to that positive amount. Payment shall be made annually in arrears, or at such other intervals or on such other basis as the Fund Manager may determine, and shall be effected as soon as reasonably practicable following the final Valuation Day in each Crystallisation Period.
Where the aggregate of all daily accruals for a Crystallisation Period is zero or negative, no Performance Fee shall be payable to the Fund Manager in respect of that Crystallisation Period.
“Crystallisation Period” means, in respect of each Class, each consecutive period of twelve (12) months ending on a Valuation Day, or such other period as the Fund Manager may prescribe. By derogation to the foregoing, the first Crystallisation Period will commence on the launch date of the Sub-Fund and end on the last Valuation Day falling twelve (12) months after the launch date. Any change in the length or frequency of Crystallisation Periods shall be notified to Unitholders in advance in the manner set out above.
In the event of a redemption of Units on a Redemption Day that does not fall on the final Valuation Day of a Crystallisation Period, the Performance Fee attributable to those Units shall be calculated on a pro rata basis by reference to the accrued Performance Fee from the commencement of the then-current Crystallisation Period up to and including the relevant Redemption Day.
In the case of Classes A1 and B1 Units only (together, for the purposes of this section, the “Applicable Classes”), and solely while the Top-Up Feature (as defined below) remains in force, the Fund Manager may, at its sole and absolute discretion, elect to waive the Performance Fee attributable to a redeeming Unitholder in respect of that Applicable Class at the point of redemption. Any such waiver shall be limited to, and funded solely from, the aggregate of positive Performance Fees standing to the credit of the Fund Manager in respect of that Applicable Class across all Crystallisation Periods (including any prior Crystallisation Periods) and any positive Performance Fee accrued on a pro rata basis in the then-current Crystallisation Period up to and including the relevant Redemption Day. The Performance Fee so waived shall be applied to the calculation of the redemption proceeds of the relevant redeeming Unitholder as at the relevant Redemption Day and shall not otherwise affect the Net Asset Value of the Applicable Class.
The Fund Manager may also, in its sole discretion, reduce or waive any Performance Fees at any time and for any period, including in particular during any wind-down of the Sub-Fund’s or Fund’s business.
14.3 Top-Up Feature
The “Top-Up Feature” refers to the right of (i) the Fund Manager to waive Performance Fees as described above and/or (ii) the Fund Manager and/or any member of the Chocolate Group to transfer Units of the Applicable Classes held by the Fund Manager and/or any member of the Chocolate Group to Unitholders of the Applicable Classes (such transferred Units may then be sold on behalf of the relevant Unitholders, with the proceeds distributed to them), in each case solely upon redemption of the relevant Unitholder’s Units and to the extent necessary for that Unitholder to receive a total return equal to the prevailing Chocolate Rate on their holding. The top-up amount, if any, is determined on the relevant Redemption Day as the difference between the balance reflecting the Chocolate Rate applicable to the redeeming Unitholder’s holding and the Fund’s Net Asset Value per Unit on that day, and arises only where the Fund has underperformed the Chocolate Rate at the time of redemption. For the avoidance of doubt, the Top-Up Feature does not operate on a continuous or annual basis and no top-up assessment is made in respect of continuing Unitholders who have not redeemed.
This Top-Up Feature is intended to operate as a mechanism for aligning the interests of the Fund Manager with those of the Unitholders of the Applicable Classes. The Fund Manager reserves, and by subscribing or continuing to hold Units each Unitholder (whether or not a holder of an Applicable Class) is deemed to acknowledge and accept, the unfettered right of the Fund Manager, acting in good faith and in what it reasonably considers to be the best long-term interests of the Fund and the Sub-Fund and its Unitholders as a whole, to terminate or suspend the operation of the Top-Up Feature with respect to any Applicable Class at any time and without prior notice if, in the sole opinion of the Fund Manager, the continued operation of the Top-Up Feature would be unduly prejudicial to the Fund Manager or no longer consistent with prevailing market conditions or the investment objectives of the Sub-Fund. Any suspension or termination of the Top-Up Feature will be notified to Unitholders of the Applicable Classes by publication through the Digital Platform and/or at www.kelvin-dev.click.
For clarity, (a) any discretionary waiver under the Top-Up Feature may be funded from the aggregate of positive Performance Fees accrued by the Fund Manager in respect of the relevant Applicable Class across all Crystallisation Periods (including any prior Crystallisation Periods, in which case the relevant amount shall be paid by the Fund Manager to the redeeming Unitholder out of previously received Performance Fees) and any positive Performance Fee accrued on a pro rata basis in the then-current Crystallisation Period up to and including the relevant Redemption Day; (b) any discretionary transfer under the Top-Up Feature may be made from the Fund Manager and/or any member of the Chocolate Group and does not constitute a liability, or draw upon the assets, of the Sub-Fund; and (c) the termination or suspension of the Top-Up Feature shall not affect any waived fees or transfers of the Fund Manager or any member of the Chocolate Group, in respect of the Top-Up Feature prior to the effective date of any termination or suspension of the Top-Up Feature.
“Chocolate Rate” means, in respect of each Applicable Class, the annualised target return rate (expressed as a percentage per annum) that the Sub-Fund aims to deliver to Unitholders of that Class, as determined by the Fund Manager from time to time, having regard to prevailing market conditions. The Chocolate Rate may be changed from time to time with reasonable prior notice given to Unitholders via the Digital Platform and/or at www.kelvin-dev.click, provided that any such change shall only take effect on the date specified in the notice given to Unitholders. For the avoidance of doubt, the Chocolate Rate published on the Digital Platform and/or at www.kelvin-dev.click shall prevail and supersede any Chocolate Rate as may otherwise have been disclosed.
14.4 Transaction Fees
There will be no Subscription Fee, Redemption Fee or Conversion Fee due to the Sub-Fund.
14.5 Custodian Fee
The Custodian will receive out of the assets of the Sub-Fund a Custodian Fee of up to 10 basis points per annum, calculated by reference to assets under custody, the number of transactions, and other trade-related charges. This Custodian Fee will be included within the Operating Expenses Cap (such term as defined below).
The Custodian is also entitled to be reimbursed by the Sub-Fund for all reasonable out-of-pocket expenses.
14.6 Administrator Fee
The Administrator will receive out of the assets of the Sub-Fund an Administrator Fee of up to 5 basis points per annum, comprising fund accounting fees, financial statement preparation fees, and other administration-related charges at the rates agreed with the Administrator. This Administrator Fee will be included within the Operating Expenses Cap.
The Administrator is also entitled to be reimbursed by the Sub-Fund for all reasonable out-of-pocket expenses.
14.7 Operating Expenses
The Operating Expenses charged to the Sub-Fund are capped at a maximum annual percentage of 1% of the Net Asset Value (the “Operating Expenses Cap”). Any amount exceeding this Operating Expenses Cap will be borne by the Fund Manager.
15. Definitions
A. Business Day
A Business Day is any day on which banks are normally and concurrently open for business in the United Arab Emirates, the United Kingdom and the United States of America.
B. Dealing Day
A Dealing Day is each calendar day.
C. Valuation Day
The Net Asset Value of each Class of Units is determined for each day that is a Dealing Day (a “Valuation Day”).
16. Risk Factors Specific to Chocolate Finance UAE Funds – Chocolate Global Income Fund
Investors should note that the Sub-Fund invests in a range of asset classes, markets and currencies. These are subject to different types and levels of risk. This means the Sub-Fund is exposed to a spread of risk but each to a lesser extent than if invested into a single asset class, market or currency. The main risks the Sub-Fund is exposed, but not limited to, are as follows:
A. Discretionary Nature of the Top-Up Feature; No Guarantee or Capital Protection
The Top-Up Feature is discretionary and does not confer any right or entitlement on any Unitholder. Any waiver of Performance Fees or transfer of Units under the Top-Up Feature is made at the sole and absolute discretion of the Fund Manager and/or the relevant member of the Chocolate Group. The fact that a Unitholder holds Units of an Applicable Class does not mean that any such waiver or transfer will be made, or that the Unitholder will receive any benefit under the Top-Up Feature. The Fund Manager and/or the relevant member of the Chocolate Group may decline to make any waiver or transfer, and may terminate or suspend the operation of the Top-Up Feature at any time in accordance with the terms of this Sub-Fund Supplement.
The making of any waiver of Performance Fees or transfer of Units under the Top-Up Feature, and its amount, timing and form, are matters for the sole and absolute discretion of the Fund Manager and/or the relevant member of the Chocolate Group. Any benefit which may be available to a Unitholder under the Top-Up Feature is accordingly uncertain, may be lower than the Unitholder might expect, and may be nil.
The Top-Up Feature does not constitute, and must not be understood as, a guarantee, an assurance of any minimum return, capital protection or capital preservation of any kind. The Sub-Fund is not a capital-protected fund and is not a capital-guaranteed fund. The Fund Manager and/or any member of the Chocolate Group is not a bank. Units in the Sub-Fund are not deposits with, or obligations of, or guaranteed or insured by, any bank or insurer, and are not insured by any governmental agency. Neither the Fund Manager nor any of its affiliates guarantees the payment of any income or return, or the performance of the Sub-Fund. The value of Units may fall as well as rise; a Unitholder may receive back less than the amount invested and may lose the entire amount invested. The existence or operation of the Top-Up Feature (including any waiver of Performance Fees or transfer mechanism thereunder) does not reduce or alter any of these risks, and Unitholders should not rely on the Top-Up Feature as a means of protecting their capital or of securing any particular return.
The Top-Up Feature applies only to the Applicable Classes and does not extend to any amount above the Maximum Investment Amount per Investor.
B. Limited Rights of Unitholders
Unitholders will have no right to participate in the day to day operations of the Sub-Fund. Consequently, Unitholders will not have any control over the management of the Sub-Fund, or the appointment and removal of its service providers.
C. Fraud
In making certain investments, the Fund Manager may rely upon the accuracy and completeness of representations made by the issuer or vendor of such investment but cannot guarantee the accuracy or completeness of such representations. The issuer or vendor of an investment may make a material misrepresentation or omission. Such inaccuracy or incompleteness may adversely affect the Sub-Fund or the valuation of any investment. Instances of fraud and other deceptive practices committed by senior management of certain companies in which the Sub-Fund may invest or transact with may undermine the ability of the Fund Manager to conduct effective due diligence on, or successfully exit investments made in, such companies. In addition, financial fraud may contribute to overall market volatility, which can negatively impact the Sub-Fund’s investment program. Under certain circumstances, payments to the Sub-Fund could be reclaimed if they are later determined to have been made with an intent to defraud creditors or make a preferential payment.
D. Operating Deficits
The expenses of operating the Sub-Fund could exceed the Sub-Fund’s income, thereby requiring that the difference be paid out of the Sub-Fund’s capital, reducing the amount available for the Sub-Fund’s investments and the Sub-Fund’s potential for profitability.
E. Material Non-Public or Confidential Information
The Fund Manager and its affiliates may acquire material non-public and/or confidential information that may restrict by law, internal policies or otherwise the Fund Manager and its affiliates from purchasing securities or other assets, or selling securities or other assets, for themselves or their clients (including the Sub-Fund) or otherwise using or receiving such information for the benefit of their affiliates or their clients. Due to these restrictions, the Fund Manager may not initiate a transaction for such Sub-Fund's account that the Fund Manager otherwise might have initiated, and this may have a significant impact on the ability to implement such Sub-Fund's strategy. In addition, the Sub-Fund may thereby become frozen in an investment position that it otherwise might have liquidated or closed out. In order to maintain flexibility to invest in securities without violating securities laws that restrict trading while in possession of material non-public information, the Fund Manager may establish internal structures and information walls restricting its access to material non-public information that might otherwise be available to it through its relationships with its affiliates. As a result, the Fund Manager's investment flexibility may be constrained and it may sometimes make investment decisions that are different than those it would make if it had access to such information. Such decisions may result in a material loss to the Sub-Fund.
F. Interest Rate Risk
During periods of very low interest rates, the Sub-Fund may be unable to maintain positive returns or pay dividends to the Unitholders of the Sub-Fund. Very low interest rates may magnify interest rate risk. Changing interest rates may have unpredictable effects on markets, result in heightened market volatility and detract from the Sub-Fund’s performance to the extent the Sub-Fund is exposed to such interest rates. Additionally, under certain market conditions in which interest rates are low and the market prices for portfolio securities have increased, the Sub-Fund may have a very low or even negative yield. A low or negative yield may cause the Sub-Fund to lose money in certain conditions and over certain time periods. An increase in interest rates will generally cause the value of debt securities held by the Sub-Fund to decline, may lead to heightened volatility in the fixed-income markets and may adversely affect the liquidity of certain fixed-income investments, including those held by the Sub-Fund. Because rates on certain floating rate debt securities typically reset only periodically, changes in prevailing interest rates (and particularly sudden and significant changes) can be expected to cause some fluctuations in the Net Asset Value of the Sub-Fund to the extent that it invests in floating rate debt securities. Any previously historically low interest rate environment heightens the risks associated with subsequent rising of interest rates.
G. Derivatives Risks
The Sub-Fund may from time to time utilise derivatives, including without limitation, both exchange-traded and over-the-counter futures, options and contracts for difference as part of its investment policy. These instruments are highly volatile and expose investors to a higher risk of loss. Certain swaps, options and other derivative instruments may be subject to various types of risks, including market risk, liquidity risk, credit risk, legal risk and operations risk. The low initial margin deposits normally required to establish a position in such instruments permit a high degree of leverage. As a result, depending on the type of instrument, a relatively small movement in the price of a contract may result in a profit or a loss which is high in proportion to the amount of funds actually placed as initial margin and may result in unquantifiable further loss exceeding any margin deposited. Transactions in over-the-counter contracts may involve additional risk as there is no exchange market on which to close out an open position and thus limit loss. It may be impossible to liquidate an existing position, to assess the value of a position or to assess the exposure to risk. The Sub-Fund may also sell covered and uncovered options. To the extent that such options are uncovered, the Sub-Fund could incur an unlimited loss.
H. Credit Risk
The Sub-Fund’s investments in debt securities may be subject to adverse changes in the financial condition of particular issuers, or in general economic conditions, or both, or an unanticipated rise in interest rates, which may impair the ability of particular issuers to make payments of interest and principal, especially if the issuer is highly leveraged. Such issuers’ ability to meet their debt obligations may also be adversely affected by specific corporate developments, or an issuer’s inability to meet specific projected business forecasts, or the unavailability of additional financing. Also, an economic downturn or an increase in interest rates may increase the perceived potential for default by particular issuers of these securities, depending on their prevailing perceived credit quality and/or assigned credit ratings by widely recognised ratings agencies.
نحرص على الشفافية التامة. تفضّل بزيارة صفحة معلومات الصندوق للاطلاع على تحديثات صافي قيمة الأصول (NAV) اليومية وجميع مستندات الصندوق الرسمية.