Within the framework of rendering custody services for certificates of the Closed-End Investment Fund “Citadele Ukrainian Real Estate Fund” (hereinafter referred to as “the Fund”), JSC “Citadele banka” (hereinafter referred to as “the Bank”) hereby notifies you of the Decree issued by the Ukrainian Securities and Stock Market State Commission, dated May 14, 2012, regarding the cessation of the circulation of Fund investment certificates due to the liquidation of the Fund (hereinafter referred to as “the Decree”).
As per the information obtained by the Bank and within the liquidation process of the Fund announced by the asset management company “Citadele Asset Management Ukraine” LLC (hereinafter referred to as “the Company”), the Bank hereby informs you that Ukrainian legislation provides two options for settlement available to the Fund’s investors: settlement with monies or settlement with the assets of the Fund other than monies. However, the settlement with the assets of the Fund other than monies can be effected only if 100% of the investors unanimously support such an option.
— In the case of a settlement for investment certificates with the assets of the Fund other monies, every investor of the Fund shall receive the portion of the assets (property) of the Fund proportional to the quantity of certificates held by the particular investor and to the value of one equal portion calculated as at one investment certificate circulated as of the date of issuing the decision on liquidation of the Fund, precisely April 26, 2012. Herewith, any expenditure including those for registration fees, taxes, duties and other possible expenses regarding transfer and registration of the title for the portion of assets in the Fund that is due to the investor, shall be settled by the investor himself.
— In the case of a settlement for investment certificates with the monies, payments shall be effected by the Fund Liquidation commission within three months from the funds which will be received as a result of the Fund’s assets selling procedure and its completion, i.e., not earlier than starting from January 10, 2013.
As you have been advised earlier, the payment of monies to investors will be executed in the base currency of the Fund – the Ukrainian hryvnia, which will be credited by the Bank to your investment account (Funds account for performance of financial instruments transaction) upon receipt from the Company.
Please be aware that the Ukrainian hryvnia is not a freely convertible currency, and its subsequent transfer to other accounts may be encumbered, therefore, in order to return your primarily invested currency, it shall be necessary to perform currency exchange (conversion) from the Ukrainian hryvnia (UAH) received from the investments to a freely convertible currency. The conversion procedure shall be performed in accordance with the Ukrainian legislation.
With regard to the above, we ask you to provide us with your opinion and notify the Bank on the most suitable option for a settlement for investment certificates of the Fund by July 16, 2012: settlement with monies or settlement with the assets of the Fund other than monies, by submitting the relevant document to the Bank, including a free-format order filed via Internet bank.
Please, be advised that in case if notification is not submitted to the Bank, or if the Bank receives at least one notification of the intent to receive the settlement with monies, the settlement shall be performed with monies, since providing settlements for investment certificates with the assets of the Fund other than monies there is a need for total consensus of the investors.
By making a decision as to the way of settlement, please carefully assess all the risks referred to the decision, including the risks of losses due to low rate of liquidity or illiquidity, or other unfavorable market conditions, which could significantly affect the value of the assets of the Fund in the course of their disposal by sale, or due to changes in the currency exchange rate, application and changes in Ukrainian legislation or other risks and unfavorable conditions, which cannot be currently foreseen now.
Please do not hesitate to contact your Bank officer in case of any inquiries.
Sincerely,
JSC “Citadele banka”