Head Office: 1306-1307, Chapal Plaza, Hasrat Mohani Road, Karachi
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Transcript of Head Office: 1306-1307, Chapal Plaza, Hasrat Mohani Road, Karachi
Head Office: 1306-1307, Chapal Plaza, Hasrat Mohani Road, Karachi-74000.
Tel: (92-21) 2441311-14 Fax: (92-21) 2425652
7/ 1, Venus Plaza, 7/ E, Egerton Road, Lahore.
UTP-ISLAMIC FUND
OFFERING DOCUMENT
Management Company
ABAMCO LIMITED
Trustee
MUSLIM COMMERCIAL FINANCIALSERVICES (PVT.) LIMITED
(A wholly owned subsidiary of Muslim Commercial Bank Limited)
UTP-ISLAMIC FUND
OFFERING DOCUMENT
SYNPOSIS OF OFFERING DOCUMENT OF UTP – ISLAMIC FUNDDated December 27, 2002
1. MANAGEMENT COMPANY
ABAMCO Limited (ABAMCO) is the Management Company. It is the first asset management companyin the private sector in Pakistan and has been registered with the Securities & Exchange Commissionof Pakistan (SECP) as an investment adviser and an asset management company. ABAMCO is asubsidiary of Jahangir Siddiqui & Co. Limited.
ABAMCO is presently managing the BSJS Balanced Fund Limited (BBF), Unit Trust of Pakistan (UTP),UTP – Income Fund (UTP-IF), an open-end mutual fund, listed on the LSE and twelve ICP MutualFunds (ICP Mutual Funds Lot A). The total net assets of the funds under the management of ABAMCOis Rs. 3.5 billion.
2. TRUSTEE
Muslim Commercial Financial Services (Pvt.) Limited (MCFSL) a wholly owned subsidiary of MuslimCommercial Bank Limited is the Trustee. The Trustee will take into custody and under its control allthe property of UTP – Islamic Fund and hold it in trust for the Unit Holders. The Trustee will carry outthe instruction of the Management Company in all matters including the investment and dispositionof the Deposited Property, unless they are in conflict with the Trust Deed, the Offering Document andthe SECP Rules.
3. OBJECTIVES
The main objective of the UTP – Islamic Fund is to provide an avenue of investment to those who wantto invest their savings in such schemes, which are Shariah compliant. In addition the aim is to provideto the investors an optimum rate of return, reasonable safety of capital and to provide to the investorsliquidity to join or leave the fund at their convenience.
4. SUBSCRIPTION TO UNITS AND REDEMPTIONS
The Par Value of units is Rs 500/-. The Core Investors (please refer to paragraph 4.1 page 18 of theOffering Document) have invested at Par Value a sum of Rs 60 million for a period of two years fromDecember 2002.
Units are offered for public subscription during the Initial Period on Buiness Days from Friday, December27, 2002 to Saturday, January 4, 2003 at Par Value.
After the Initial Period, the units can then be purchased at their respective Offer Price and redeemedat their respective Redemption Price, which the Management Company shall announce on a weeklybasis based on the Net Asset Value of Units. The Offer Price will include a Sales Load.
5. INVESTMENT STRATEGY
UTP – Islamic Fund will invest in a diversified portfolio of equity securities and instruments in accordancewith the requirement of Shariah with a view to optimise returns balanced with risk.
A Shariah Advisory Council, appointed by the Management Company with the approval of SECP, willadvise the Management Company on Shariah compliance.
6. SHARIAH ADVISORY COUNCIL
The Shariah Advisory Council will be composed of three persons, who must be experts on Shariah
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and have good understanding of Finance. The Management Company shall appoint the members ofthe Shariah Advisory Council with the approval of SECP.
Shariah Advisory Council will advise the Management Company on matters relating to Shariah-compliance and recommend general investment guidelines, consistent with the Shariah.
The first Shariah Advisory Council is from the Aleemiyah Islamic Missionary University, and is composedof Mr. Wasiul Hasan Ansari, Chairman and Secretary, Prof. Maulana Abu-Faheem Anwarullah Bin Waliand Mr. Mustafa Fazil Ansari, Members.
7. RISKS OF INVESTING IN UTP – ISLAMIC FUND
The Fund invests in a portfolio of securities that are subject to varying degrees of risk such as:
o Investments will initially be in the stock market. The investment exposure in each company maybe upto fifteen percent of the net assets and each sector may be upto thirty percent of the netassets, resulting in the market fluctuations to have a higher impact on the prices of UTP – IslamicFund.
o Investments in Term Finance Certificates will be on a profit and loss basis and there is a possibilitythat the net result from such investments may be a loss.
o All Investments made by the UTP – Islamic Fund will be made in adherence with the principlesof Shariah. It is possible that the effect of Shariah guidelines placed on investments may resultin the Fund performing differently to funds with similar objectives, but which are not subject toShariah review.
o The portion of the income that accrues in the Fund from non-Shariah compliant sources (i.e.Haram income) will be distributed as Charity by the Fund on authorization by the Unit Holders.Such distributions shall lower the net amount available for distribution to the Unit Holders asdividends.
o Prices of Units and the dividends paid may go down as well as up. Past performance does notnecessarily indicate future performance.
8. REMUNERATION
Management Company
1) Annual remuneration 3% per annum of average Net Assets of UTP – Islamic Fund duringthe first five years and 2% per annum thereafter.
2) An additional performance bonus as provided in the Rules.
Trustee
Monthly remuneration based on an annual tariff not exceeding 0.50% per annum upto Rs 1 billionand 0.1% for amounts exceeding Rs 1 billion of the average Net Assets.
Shariah Advisory Council
1) Remuneration to Secretary/ Member: Monthly remuneration of Rupees Ten Thousand.
2) Remuneration of Other Members: A meeting fee of Rupees Five Thousand per meeting.
The payment to Custodian, will be made by the Trustee and the payment to Transfer Agentwill be made by the Management Company and there will be no separate charge on theDeposited Property of the Fund.
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UTP – Islamic Fund will bear all cost/ expenses relating to transaction in investment, costof borrowing taxes, audit fees, legal fees and one time Formation Cost not exceeding Rs600,000.
Investors investing in UTP – Islamic Fund after the Initial Period will pay a Sales Load of 2%of NAV. This amount will be paid to the Management Company to meet the promotionalexpenses of UTP – Islamic Fund, including payment to Distribution Companies.
9. DISTRIBUTION PROCEDURE AND CHANNELS
The Distribution Companies will interface with and provide services to the Holders including receivingissue, redemption, transfer and pledge applications, conversion notices and applications for changein addresses.
The Distribution companies of UTP – Islamic Fund are ABAMCO Ltd, Jahangir Siddiqui & Co. Ltd(JSCL), Jahangir Siddiqui Investment Bank Ltd (JSIBL), Kontinental Consultants Inc., Muslim CommercialBank Limited (MCB), PICIC Commercial Bank Limited, and The Bank of Khyber.
10. DIVIDENDS
At least 90% of the income, excluding realised capital gains received by UTP – Islamic Fund will bedistributed annually, as dividend and the balance of income will be retained for re-investment.
The Management Company will also distribute a portion of realised capital gains. It may be notedhowever that the income from capital gains varies from year to year, depending upon the situationprevailing in the stock market.
11. TAXATION
The income of UTP – Islamic Fund will be exempted from tax, as it will distribute at least 90% of the income of the year, amongst the Unit Holders as dividend. Also there will be no withholding tax in theincome of UTP – Islamic Fund under the Income Tax Ordinance 2001. Any balance in the credit ofPLS Account with an Islamic Bank standing on 1st Ramazan-ul-Mubarak will be subjected to a deductionof 2.5% Zakat.
12. TAXATION OF UNIT HOLDERS AND LIABILITY TO ZAKAT
The information set forth below is included for general information purposes only. In view of the individualnature of tax consequences, each investor is advised to consult with his tax adviser with respect tothe specific tax consequences to him of investing in UTP – Islamic Fund.
(i) Income Tax: Unit holders of UTP – Islamic Fund will be subject to income tax on dividend incomeand withholding tax (excluding on portion of dividend paid out of capital gains).
• Public Company and Insurance Companies are subject to 5% income tax and withholdingtax.
• Others are subject to 10% income tax and withholding tax.
(ii) Tax Credit: Unit Holders shall be entitled to a tax credit under section 61 (1) and (2) of the IncomeTax Ordinance, 2001 to be calculated on purchase of new units upto Rs 100,000/-.
(iii) Zakat: Units held by resident Pakistani Unit Holders shall be subject to Zakat at 2.5% of the ParValue of Units under Zakat and Ushr Ordinance, 1980, (XVII of 1980), except those exemptedunder the said Ordinance.
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13. LIST OF SERVICES FOR INVESTORS
• No upper limit to issue of units to a single investor.• Units can be redeemed at the convenience of Unit Holder.• Redemption proceeds to be paid within six Business Days.• Units can be transferred.• Units can be pledge as security to a third party.• Units can be issued in certificated or non-certificated form.• Nomination.• Units can be issued with four joint Holders.• Financial reporting.
14. WHO CAN INVEST IN UTP – ISLAMIC FUND
a. Citizens of Pakistan (for minors, below 18 years of age, by their guardians).b. Companies, corporate bodies, financial institutions, banks, partners of a firm and societies
incorporated in Pakistan.c. Foreign nationals and companies incorporated outside Pakistan.d. Provident, Pension and Gratuity Funds.e. Insurance companies.f. Non Profit Institutions, funds, trusts, societies or other organizations.
15. INFORMATION GIVEN IN THIS OFFERING DOCUMENT RESPONSIBILITY OF MANAGEMENT COMPANY
ABAMCO accepts the responsibility for the information contained in this Offering Document as beingaccurate at the date of publication.
16. DISCLAIMER
All investments in mutual funds and securities are subject to market risks. Our target return/ dividendrange cannot be guaranteed. UTP-Islamic Fund's unit price is neither guaranteed nor administered/managed. It is based on the NAV, that may go up or down depending upon the factors and forcesaffecting the stock market. It is possible that the Shariah Guidelines placed on investments may resultin the Fund performing differently to funds with similar objectives, but which are not subject to ShariahReview. Past performance is not necessarily indicative of future results.
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TABLE OF CONTENTS
Part Contents Page
1 Approval and Consent 11.1 Approval of the Securities and Exchange Commission of Pakistan 11.2 Filing of the Offering Document 1
2 Definitions 3
3 Constitution, Objectives and Policies 93.1 Constitution 93.2 Objectives and Investment Policy 103.3 Trust Deed 103.4 Duration 103.5 Open ended Fund 113.6 Units 113.7 Initial Offer 113.8 Transaction in Units after Initial Period 113.9 Extraordinary Circumstances 113.10 Risk 123.11 Disclaimer 123.12 Offering Document 123.13 Information given in this Document, Responsibility of Management Company 12
4 Organization and Management 134.1 Core Investors 134.2 Management Company 134.3 Funds under Management 204.4 Shariah Advisory Council 254.5 Secretary to Shariah Advisory Council 284.6 Shariah Compliance Auditor 294.7 Trustee: Duties and Responsibilities 304.8 Transfer Agent 314.9 Distribution Companies 314.10 Auditors 324.11 Legal Advisors 324.12 Bankers 32
5 Principal Features 325.1 Features of Units to be offered 325.2 Purchase and Redemption of Units 335.3 Offer and Redemption Prices 335.4 Suspension of Dealing, Queue System and Winding up 345.5 Expenses of UTP – Islamic Fund 355.6 Dividends 365.7 Taxation 37
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6 Procedure for Purchase of Units 386.1 Who can apply? 386.2 Application Procedure 396.3 Payment 406.4 Joint Application 406.5 Allotment (Issue) of Units 40
7 Procedure for Redemption of Units 417.1 Application Procedure 417.2 Payment of Redemption Proceeds 417.3 Joint Holders 417.4 Partial Redemption 417.5 Redemption Requests in Excess of 10% of Units in Issue 41
8 Transfer of Units 428.1 Application Procedure 428.2 Partial Transfer 428.3 Verification of Transfer Application Form 42
9 Service to Unit Holders 439.1 Availability of Forms 439.2 Transfer of Account 439.3 Register of Unit Holders 439.4 Closure of Register 439.5 Information in the Register 439.6 Account Statement 449.7 Certificates 459.8 Replacement of Certificates 459.9 Pledge/ Charge/ Lien of Units 469.10 Nomination 469.11 Financial Reporting 47
10 Income Distribution 4710.1 Accounting period 4710.2 Declaration of Dividend 4710.3 Determination of Distributable Income 4710.4 Charity 4810.5 Reinvestment of Dividend 4810.6 Payment of Dividend 4810.7 Payment through the Bank of Dividends/Redemption Proceeds 4810.8 Dispatch of Dividend Warrants 48
11 Objectives and Investment Policy 4911.1 Investment Objectives 4911.2 Investment Policy 4911.3 Investment Restrictions 5211.4 Exception to Investment Restrictions 5311.5 Transactions with Connected Persons 53
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Part Contents Page
12 Borrowing Policy 5412.1 Limit 5412.2 Exception 5412.3 Pledge 5412.4 Liability of Guarantees 5412.5 Trustee and Management Company 54
13 Financial Information 5513.1 Auditors Certificate on Core Investors’ Investment in
Units of UTP – Islamic Fund 5513.2 Auditors Certificate on Net Asset Value of Units in UTP – Islamic Fund 5613.3 Formation Cost 57
14 Termination of UTP – Islamic Fund 5714.1 By the Management Company 5714.2 By the Securities and Exchange Commission of Pakistan 5714.3 Winding up 57
15 Arbitration 57
16 Authorized Branches of Distribution Companies 58
17 Applications Forms 61
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Offering Document
UTP-ISLAMIC FUND
OFFERING DOCUMENT
PART I – APPROVAL AND CONSENT
1.1 Approval of the Securities and Exchange Commission of Pakistan
The Securities and Exchange Commission of Pakistan (SECP) has authorized the offer of units ofUTP – Islamic Fund under Rule 10 of the Asset Management Companies Rules, 1995 (Rules). TheSECP has approved this Offering Document, under Rule 12 of the Rules.
It must be distinctly understood that in giving this approval, the SECP does not take any responsibilityfor the financial soundness of UTP – Islamic Fund nor for the accuracy of any statement made or anyopinion expressed in this Offering Document.
Investors may realize that all investments involve risk. It should be clearly understood that theportfolio of UTP – Islamic Fund is subject to market fluctuations and risks inherent in all suchinvestments. The value of the units in UTP – Islamic Fund may appreciate as well as depreciate,as well as the level of dividend declared by UTP – Islamic Fund may go down as well as up.
All Investments made by the UTP – Islamic Fund will be made in adherence with the principlesof Shariah. It is possible that the effect of Shariah Guidelines placed on investments may resultin the Fund performing differently to funds with similar objectives, but which are not subjectto Shariah Review.
The provisions of the Trust Deed govern this Offering Document. It sets forth information aboutUTP – Islamic Fund that a prospective investor should know before investing in any unit.Prospective investors should consult their stockbroker, bank manager, legal adviser or otherfinancial adviser.
1.2 Filing of the Offering Document
The Management Company has filed a copy of this Offering Document signed by the Chief Executivealong with the documents (1) to (7) below with the SECP. Certified copies of these documents along
OFFERING DOCUMENT OFUTP- ISLAMIC FUNDDated December 27 , 2002
(Managed by ABAMCO Limited, an asset management company registered under the Asset Management Companies Rules, 1995)
Established in Pakistan by a Trust Deed, dated December 16, 2002 registered under theTrusts Act, 1882 (11 of 1882) between ABAMCO Limited, as the management company andMuslim Commercial Financial Services (Pvt.) Limited, as the trustee and authorized underRule 10 of the Asset Management Companies Rules, 1995
Initial Period: On Business Days from Friday, December 27, 2002 to Saturday,January 4, 2003 during banking hours
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with documents (8) to (12) below can be inspected at the registered office of the Management Companyor the place of business of the Trustee, at addresses provided in the paragraph 3.1 of this OfferingDocument.
(1) Trust Deed (Deed) of UTP – Islamic Fund dated December 16, 2002, between ABAMCO Limited,as the establisher and the management company and Muslim Commercial Financial Services(Pvt.) Limited, as the trustee;
(2) Custodian Agreement between Muslim Commercial Bank Limited and Muslim CommercialFinancial Services (Pvt.) Limited;
(3) The Transfer Agent Agreement between ABAMCO Limited and Technology Trade (Pvt.) Limited;
(4) Distribution Agreements between Muslim Commercial Financial Services (Pvt.) Limited and thefollowing distributors;a) ABAMCO Limited,b) Jahangir Siddiqui & Co. Limited,c) Jahangir Siddiqui Investment Bank Limited,d) Kontinental Consultants Inc.,e) Muslim Commercial Bank Limited,f) PICIC Commercial Bank Limited,g) The Bank of Khyber,
(5) Shariah Advisory Council’s letter dated December 3, 2002 certifying, that the provisions of theTrust Deed are Shariah compliant;
(6) Shariah Advisory Council’s letter dated December 18, 2002 certifying, that the provisions of theOffering Document are Shariah compliant;
(7) Letter from Ford Rhodes Sidat Hyder & Co, Chartered Accountants, Auditors of UTP – IslamicFund, consenting to the issue of statements and reports appearing in Part XIII of this OfferingDocument;
(8) The SECP’s (formerly known as Corporate Law Authority) letter No 7(1)CF/AM/95-1, datedAugust 29, 1995, registering ABAMCO Limited as an asset management company together withthe Certificate of Registration;
(9) The SECP’s letter No SC/MF-JD(R)/440/2002, dated November 27, 2002, approving theappointment of Muslim Commercial Financial Services (Pvt.) Limited as the trustee of UTP –Islamic Fund;
(10) The SECP’s letter No SC/MF-JD(R)/442/2002, dated November 29, 2002, approving theappointment of Shariah Advisory Council;
(11) The SECP’s letter No.SC/MF-JD(R)/417/2002, dated November 18, 2002, authorizing UTP –Islamic Fund;
(12) The SECP’s letter No. SC/MF-JD(R)/464/2002. dated December 20, 2002, approving this OfferingDocument.
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PART II – DEFINITIONS:
All defined terms used in this Offering Document are those defined in the Trust Deed.
Unless the context requires otherwise the following words or expressions shall have the meaning respectivelyassigned to them viz.:
2.1 “Accounting Date” means in case of the final Accounting Period, the date on which moneyrequired for the final distribution is transferred to the Distribution Account, and in any other case thethirtieth day of June in each year provided that the Management Company with the written consentof the Trustee, change such date to any other date.
2.2 “Accounting Period” means a period ending on and including an Accounting Date and commencing(in case of the first such period) on the date on which the Deposited Property is first paid or transferredto the Trustee and (in any other case) from the end of the preceding Accounting Period.
2.3 “Account Statement” means statement of transactions in Units in the folio of the Holder.
2.4 “Administrative Plans” means investment plans offered by Management Company, where suchplans allow investors a focused investment strategy in any one or a combination of unit trust schemesmanaged on the Shariah-compliant basis by the Management Company and for which Trustee isappointed as the trustee.
2.5 “AMC” means Asset Management Company.
2.6 “Auditor” means the Auditor of the Trust appointed by the Management Company.
2.7 “Authorized Branch” means those branches of the Distributors authorized by the ManagementCompany.
2.8 “Authorized Investment” means any Shariah compliant investment approved as such by theShariah Advisory Council, from time to time, but does not include bearer security or any othersecurity that would involve the assumption of unlimited or undeterminable liability.
2.9 “Back-end Load” means Sales Load deducted from the Net Asset Value in determining theRedemption Price.
2.10 “Bai Mu’ajjal” means a contract in which the seller earns a profit margin on his purchase price andallows the buyer to pay the price at a future date in a lump sum or in installments.
2.11 “Bai’ Salam” means a contract in which advance payment is made for certain defined goods (otherthan gold, silver and currencies) to be delivered later on a fixed date.
2.12 “Bank” means a banking company licensed under the Banking Companies Ordinance, 1962 or anyother regulation for the time being in force and will include an Islamic Bank.
2.13 “Bank Accounts” means accounts maintained with a Bank, the beneficial ownership ofwhich rests in the Holder.
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2.14 “Business Day” means a day on which Banks are open for business in Pakistan.
2.15 “Certificate” means the definitive certificate acknowledging the number of Units registered in the nameof the Holder issued at the request of the Holder pursuant to the provisions of this Deed.
2.16 “Charity” means amount paid by Management Company out of the income of the Trust to acharitable/ welfare organization, in consultation with Shariah Advisory Council, representing income,which is Haram.
2.17 “Companies Ordinance” means the Companies Ordinance, 1984, as amended for time to time.
2.18 “Connected Person” shall have the same meaning as in the Rules.
2.19 “Constitutive Document” means the Trust Deed that is the principal document governing theformation, management or operation of the Trust.
2.20 “Contingent Load” means Sales Load payable on redemption of Units within a certain number ofyears from the date of purchase and/or at a rate decreasing for every year or period the Units are held.
2.21 “Core Investors” means the initial investors, who shall be required to subscribe to and to hold numberof Units of Par Value of not less than Fifty Million Rupees (Rs 50,000,000) for the minimum two yearsfrom the date of payment in full of such Units.
2.22 “Core Units” shall mean such Units of the Trust that are issued to Core Investors with thecondition that these are not redeemable for a period of two years from the date of issue. However,such Units are transferable with this condition and shall rank pari passu with all other Units save forthis restriction. Any transfer of these Core Units, during the first two years of their issue, shall beaffected only on the receipt by the Transfer Agent of a written acceptance of this condition by the transferee.
2.23 “Custodian” means a Bank that may be appointed by the Trustee with the approval of the ManagementCompany to hold and protect the Deposited Property or any part thereof as custodian on behalf of theTrustee.
2.24 “Deposited Property” means the aggregate proceeds of the sale of all Units at Offer Price afterdeducting therefrom or providing thereout any applicable Sales Load and Duties and Charges andincludes the Investment and all income, profit and other benefits arising therefrom and all cash andother assets movable or immovable and property of every description for the time being held or deemedto be held upon trust by the Trustee for the benefit of the Holders pursuant to this Deed but does notinclude any amount standing to the credit of the Distribution Account.
2.25 “Distribution Account” means the Bank Account, which may be current, saving or deposit accountmaintained by the Trustee in a Shariah Compliant account with an Islamic Bank approved by theManagement Company in which the amount required for the distribution of income to the Holders shallbe transferred. Income of this account, if any, will accrue to the benefit of the Trust.
2.26 “Distributor/ Distribution Company” means a company, firm or a Bank appointed by the Trusteewith the approval and instructions of the Management Company for performing the Distribution Functionand shall also include the Management Company itself, if it performs the Distribution Function.
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2.27. “Distribution Function” mean with regard to:
(a) Receiving applications for issue of Units together with the aggregate Offer Price for Units appliedfor by the applicants;
(b) Issuing of receipts in respect of (a) above;
(c) Interfacing with and providing services to the Holders including receiving redemption applications,transfer applications, conversion notices and applications for change of address or issue ofduplicate Certificates for immediate transmission, in accordance with the instructions given bythe Management Company or the Trustee, to the Management Company or the Transfer Agentas appropriate; and
(d) Accounting to the Trustee for all (1) moneys received from the applicants for issuance of Units;(2) payments made to the Holders on redemption of Units; and (3) expenses incurred in relationto the Distribution Function.
2.28 "Dow Jones" means Dow Jones & Company Inc., who have developed an Islamic Market Index ofShariah compliant Investments, under the name of "Dow Jones Islamic Market Index", overseen bya specialized Shariah Board, consisting of prominent Muslim religious scholars.
2.29 “Duties and Charges” means in relation to any particular transaction or dealing all stamp and otherduties, taxes, Government charges, brokerage, bank charges, transfer fees, registration fees and otherduties and charges whether in connection with the constitution of the Deposited Property or the increaseor decrease of the Deposited Property on the creation, issue, sale, transfer, redemption or purchaseissue of Units or the sale or purchase of Investments or in respect of the issue, transfer, cancellationor replacement of a Certificate or otherwise which may have become or may be payable in respectof or prior to or upon the occasion of the transaction or dealing in respect of which such duties andcharges are payable but do not include the remuneration payable to the Distribution Company or anycommission charges or costs which may have been taken into account in ascertaining the Net AssetValue.
2.30 "Fatwa" means a religious decree made by the Shariah Advisory Council or a group of at least threeMuftis (Islamic religious scholars qualified to make a religious decree) associated with AleemiyahIslamic Missionary University, Karachi or any other credible Islamic institution.
2.31 “Formation Cost” means all preliminary and floatation expenses of the Trust including expenses inconnection with authorization of the Scheme, execution and registration of the Constitutive Document,issue, circulation and publication of the Offering Document and all expenses incurred during the InitialPeriod.
2.32 “Front-end Load” means the Sales Load that is included in the Offer Price of Units.
2.33 “Halal” means anything permitted by the Shariah.
2.34 “Haram” means anything prohibited by the Shariah.
2.35 “Holder” or “Unit Holder” means the investors for the time being entered in the Register as owner ofa Unit, including investors jointly so registered pursuant to the provisions of the Deed.
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2.36 “Initial Period” or “Initial Offering Period” means a period determined by the Management Companynot exceeding ninety days during which Units will be offered at the Initial Price in terms of the OfferingDocument.
2.37 “Initial Price” means the price per Unit during the initial offering period determined by the ManagementCompany.
2.38 “Investment” means any Authorized Investment forming part of the Deposited Property.
2.39 “Islamic Asset Management Company” means an associate company of ABAMCO, which may takeover the management of the Scheme after a period of two years from the date of subscription of CoreInvestors or earlier as may be decided by the Promoters with the approval of the SECP and managethe affairs of the Scheme and launch further Shariah Compliant Schemes.
2.40 “Islamic Bank” means a Bank having license as Scheduled Islamic Commercial Bank from State Bankof Pakistan or a Bank, which accepts deposits on profit and loss basis and will include all Banks orfinancial institutions, approved by Shariah Advisory Council for the purpose of Banking by the trust.
2.41 “Istisna’a” means a contractual agreement for manufacturing goods and commodities, allowing cashpayment in advance and future delivery or a future payment and future delivery.
2.42 “Mudarabah” means a form of partnership where one partner provides funds, while other providesexpertise and management.
2.43 "Mudharib/ Mudarib" means a working partner, who provides entrepreneurship and managementunder a Mudarabah agreement as distinct from the sahib-al-mal who provides the finance.
2.44 “Mufti” means a Muslim interpreter and expounder of Islamic Laws, who is qualified from a crediblereligious institution.
2.45 “Murabahah” means a sale on mutually agreed profit. Technically it is a contract of sale in which theseller declares his cost and profit. As a financing technique, it involves a request by the client to the financer to purchase certain item for him, which is then sold to the client.
2.46 “Musharakah” means a relationship established under a contract by the mutual consent of the partiesfor sharing of profits and losses arising from a joint enterprise or venture. All providers of capital areentitled to participate in management, but not necessarily required to do so. The profit is distributedamong the partners in pre-agreed ratios, while the loss is borne by each partner strictly in proportionto respective capital contributions.
2.47 “Net Assets”, in relation to the scheme, means the excess of assets over liabilities of the scheme,such excess being computed in the manner specified hereunder:--
a) A security listed on a stock exchange shall be valued at its sale price on such exchange on thedate as of which it is valid, or if such exchange is not open on such date, then at its last saleprice on the next preceding date on which such exchange was open and if no sale is reportedfor such date, the security shall be valued at an amount not higher than the closing asked pricenor lower than the closing bid price.
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b) an investment purchased and awaiting payment against delivery shall be included for valuationpurposes as a security held, and the cash account of the Trust shall be adjusted to reflect thepurchase price, including brokers commission and other expenses incurred in the purchasethereof but not disbursed as of the valuation date;
c) an investment sold but not delivered pending receipt of proceeds shall be valued at the net salesprice;
d) the value of any dividends, bonus, shares or right which may have been declared on securitiesin the portfolio but not received by the Trust as of the close of business on the valuation dateshall be included as assets of the Trust, if the security upon which such dividends, bonuses orrights were declared is included in the assets and is valued ex-dividend, ex-bonus or ex-rightsas the case may be;
e) a security not listed or quoted on a stock exchange shall be valued at investment price or itsbreak up value as per last audited accounts, whichever is lower;
f) profit/ mark up accrued on any Shariah compliant financing arrangement including but not limitedto Murabahah, Musharakah, Bai’ Mu’ajjal, Bai’ Salam, and Istisna’a extended out of the DepositedProperty of the Fund, shall be included in the asset of the Fund;
g) any other income accrued (on Authorized Investments) up to the date on which computation wasmade shall also be included in the assets; and
h) all liabilities, expenses, taxes and other charges due or accrued up to the date of computationswhich are chargeable under the Rules shall be deducted from the value of the assets.
2.48 “Net Asset Value” or "NAV" means per Unit value of the Trust arrived at by dividing the Net Assetsby the number of Units outstanding.
2.49 “No Load” means no Sales Load payable on sale or redemption of Units.
2.50 “Offer Price” means the sum to be paid to the Trustee for issuance of one Unit, such price to bedetermined pursuant to sub paragraph 5.3 (c) of this Offering Document.
2.51 “Offering Document” means the prospectus, advertisement or other document, which contains theinvestment and distribution policy and all other information in respect of the Unit Trust, as, requiredby the Rules and is calculated to invite offers by the public to invest in the Unit Trust.
2.52 “Ordinance” means the Securities and Exchange Ordinance, 1969, as amended from time to time.
2.53 “Par Value” means the face value of a Unit that shall be Rupees Five Hundred (Rs. 500/-) or suchother amount as may be determined by the Management Company in consultation with the Trusteefrom time to time.
2.54 “Personal Law” means the law of inheritance and succession as applicable to the individual Unit Holder.
2.55 “Promoters” means the Management Company and any other organization, which may join the
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Management Company as a joint venture partner for the purpose of forming and managing the IslamicAsset Management Company.
2.56 “Redemption Price” means the amount to be paid to the relevant Holder of a Unit upon redemptionof that Unit, such amount to be determined pursuant to sub paragraph 5.3 (d) of this Offering Document.
2.57 “Register” means the Register of the Holders kept pursuant to the Rules and the Deed.
2.58 “Registrar Functions” means the functions with regard to:
(a) Maintaining the Register;
(b) Receiving application for redemption and transfer/ transmission of Units directly from Holderor legal representatives or through Distributor;
(c) Processing requests for issue, redemption, transfer and transmission of Units and requests forrecording of pledge or for recording of changes in information/ particulars/ data with regard tothe Holders;
(d) Issuing Account Statement to Holders;
(e) Issuing Certificates including Certificates in lieu of undistributed income to Holders;
(f) Dispatching income distribution warrants and allocating Units to Holders on re-investment ofdividends as per Part X of this Offering Document;
(g) Canceling old Certificates on redemption or replacement;
(h) Maintaining record of lien/ pledge/ charge; and
(i) Keeping record of change of addresses/ other particulars of the Holders.
2.59 “Reporting or Base Currency” means Pakistani Rupee in which financial reports are presented.
2.60 “Rules” means the Asset Management Companies Rules, 1995, as amended from time to time.
2.61 “Sales Load” means the sales and processing charge or commission (excluding Duties and Charges)not exceeding five percent (5%) of the Net Asset Value, which may be included in the Offer Price ofcertain class of units or deducted from the Net Asset Value in order to determine the Redemption Priceof certain classes of Units. The Management Company may apply different levels of Sales Load fordifferent Plans under the Shariah Compliant Fund.
2.62 “ SECP” means the Securities and Exchange Commission of Pakistan.
2.63 "Secretary to Shariah Advisory Council" means a person appointed as Secretary to Shariah AdvisoryCouncil, who must be a Mufti (an Islamic religious scholar qualified to make a religious decree) andconversant with modern business and banking conventions.
2.64 “Shares, Preference Shares and Convertible Preference Shares” means such instruments issuedby companies, establishments or organizations, whose main business is Halal and whose financialstructuring meets the criteria, laid down in the Offering Document.
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2.65 “Shariah” means divine guidance as given by the Holy Qur’an and the Sunnah of Prophet Muhammad(PBUH) and embodies all aspects of the Islamic faith, including beliefs and practice.
2.66 “Shariah Advisory Council” means a body of Islamic scholars, having knowledge of Islamic finance,appointed by the Management Company, with the clearance of SECP, to supervise and monitor theactivities of the Scheme to ensure that all its activities comply with Shariah.
2.67 “Stock Exchange” means Karachi Stock Exchange, Lahore Stock Exchange, Islamabad StockExchange or any other stock exchange registered under the Ordinance.
2.68 “Subscription Day” means every Business Day provided that the Management Company may withthe prior written consent of the Trustee and upon giving not less than seven days notice in thenewspapers declare any particular Business Day not to be a Subscription Day.
2.69 “Supplementary Offering Document” means a document issued by the Management Company, inconsultation with the Trustee, after seeking approval of the SECP, describing the special features ofan administrative plan offering investment in the Shariah Compliant Fund or a combination of theShariah Compliant Fund and other schemes managed by the Management Company, or any amendmentsmade to the Offering Document.
2.70 “Term Finance Certificates” means debts instruments issued on profit and loss sharing basis.
2.71 “Transfer Agent” means a company including a Bank that the Management Company shall appointfor performing the Registrar Functions.
2.72 “Trust”, “Unit Trust” “Scheme” or “Shariah Compliant Fund” means the Shariah Compliant UnitTrust constituted by the Trust Deed for continuous offers for sale of Units.
2.73 “Unit” means one undivided (Unit) share in the Trust.
2.74 “Zakat” has the same meaning as in Zakat and Ushr Ordinance (XVIII of 1980), 1980.
Words and expressions used but not defined herein shall have the meanings assigned to them in theRules. Words importing persons include corporations, words importing the masculine gender includethe feminine gender, words importing singular include plural words, “written” or “in writing” includeprinting, engraving, lithography, or other means of visible reproduction.
PART III – CONSTITUTION, OBJECTIVES AND POLICIES
3.1 Constitution
UTP – Islamic Fund is constituted by a Trust Deed entered into at Karachi on December 16, 2002between:
(1) ABAMCO Limited (ABAMCO), a company incorporated under the Companies Ordinance 1984,with its registered office at 1306-1307, Chapal Plaza, Hasrat Mohani Road, Karachi-74000, asthe establisher and the management company; and
(2) Muslim Commercial Financial Services (Pvt.) Limited, a company incorporated under the CompaniesOrdinance 1984 and a wholly owned subsidiary of Muslim Commercial Bank Limited, with itsregistered office at 2nd Floor, Adamjee House, I.I. Chundrigar Road, Karachi-74000, as the trustee,and with place of business as trustee of UTP – Islamic Fund at 9th Floor, Sheikh Sultan TrustBuilding No.1, Beaumont Road, Karachi-75530.
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3.2 Objectives and Investment Policy
The main objective of the UTP – Islamic Fund is to provide an avenue of investment to those who wantto invest their savings in such schemes, which are Shariah compliant. In addition the aim is to provideto the investors an optimum rate of return, reasonable safety of capital and to provide to the investorsliquidity to join or leave the Fund at their convenience. The main focus of the UTP – Islamic Fund isto provide an outlet to investors who want ‘Riba-free’ rate of returns.
Consistent with this policy, UTP – Islamic Fund will invest in a diversified portfolio of securities andinstruments in accordance with the requirement of Shariah with a view to optimise returns balancedwith risk. A Shariah Advisory Council, appointed by the Management Company with the approval ofSECP, will advise the Management Company on Shariah compliance. Please refer to Part XI of thisOffering Document for details of the investment policy.
3.3 Trust Deed
The Deed is subject to and governed by the Securities and Exchange Ordinance 1969 (Ordinance),Asset Management Companies Rules, 1995 (Rules), all other applicable laws and regulations andGuidelines of Islamic Shariah.
The terms and conditions in the Deed and any supplemental deed shall be binding on each Unit Holder.
The Trustee and the Management Company, acting together and with the approval of the SECP, shallbe entitled by supplemental deed to modify, alter or add to the provision of the Deed on any of thefollowing grounds, provided that the Shariah Advisory Council shall have certified that such alterationsor/ and additions are Shariah compliant:
1) To the extent required to ensure compliance with any applicable laws and regulations or anyamendment of such laws and regulations;
2) To enable the provisions of the Deed to be more conveniently or economically managed;
3) To enable the Units to be listed on a stock exchange;
4) Otherwise to the benefit of the Unit Holders; or
5) To comply with the provisions of Shariah;
Provided that in case (2), (3) and (4) above, such alteration or addition shall not prejudice the interestof the Unit Holders; and that in any event, it shall not release the Trustee or the Management Companyof their responsibilities.
3.4 Duration
The duration of UTP – Islamic Fund is perpetual. However it can be wound up by the SECP or by theManagement Company on the occurrence of certain events as stated in Part XIV of this OfferingDocument under the heading “Termination of UTP – Islamic Fund ”.
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3.5 Open ended Fund
UTP – Islamic Fund is an open-ended fund. It is divided into units having par value of Rupees FiveHundred each. All units and fractions thereof represent an undivided share in UTP – Islamic Fund andrank pari- passu as to their rights in the net assets, earning and receipt of dividend and distributions.
3.6 Units
UTP – Islamic Fund shall offer units to investors on a continuing basis. There is no lower or upper limitset on the units to be issued to a single unit holder or on the total number of units to be issued to thepublic. Fraction of units will not be issued except on conversion of dividend, as per paragraph 10.5(c) of this Offering Document. The units shall be fully paid before they are issued. The liability of unitholders shall be limited to the extent of unpaid amount (if any) on units. Unit Holders may redeem Unitsor fractions thereof for cash by redeeming to UTP – Islamic Fund. Units are also transferable. Unitswill be issued in registered, uncertificated form and will be confirmed to investors by means of anAccounts Statement issued by Transfer Agent. Certificate(s) will be issued, if so requested by UnitHolder.
3.7 Initial Offer
Units with a value of Rupees 60 million have been subscribed by Core Investors. Please see paragraph4.1 for details. The Initial Offer is made during the Initial Period, which will be for eight Business Daysand starts at the start of the banking hours on Friday, December 27, 2002 and shall close at the closeof the banking hours on Saturday, January 4, 2003. During the Initial Period, Units will be offered atthe Initial Price of Rupees Five Hundred (Rs. 500) per Unit. During the Initial Period the units cannotbe redeemed.
3.8 Transaction in Units after Initial Period
After the Initial Period, the public sale of units at Initial Price will be discontinued; the units can thenbe purchased at their respective Offer Price and redeemed at their respective Redemption Price.Please see paragraph 5.3 of this Offering Document. Fractional units may be issued only for purposeof reinvestment of dividends into units. The Management Company shall announce the Offer andRedemption Prices on a weekly basis at the end of the week for each following week.
3.9 Extraordinary Circumstances
The sale and redemption of units may be suspended during extraordinary circumstances includingclosure of one or more stock exchanges on which any of the securities traded by UTP – Islamic Fundare listed, the existence of a state of affairs, which in the opinion of the Management Company,constitutes an emergency as a result of which disposal of any investment would not be reasonablypracticable or might seriously prejudice the interest of UTP – Islamic Fund or of the unit holders, or abreakdown in the means of communication normally employed in determining the price of anyinvestment, or when remittance of money can not be carried out in reasonable time and if theManagement Company is of the view that it would be detrimental to the remaining unit holders toredeem units at a price determined in accordance with the Net Asset Value. The Management Companymay announce a suspension or deferral of redemption in such cases. Such a measure shall be takento protect the interest of the unit holders in the event of extraordinary circumstances or in the eventredemption requests accumulate in excess of ten percent of the units in issue. In the event of a large
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number of redemption requests accumulating, the requests may be processed in a queue system andunder extreme circumstances the Management Company may decide to wind up the UTP – IslamicFund. Please refer to paragraph 5.4 of this Offering Document.
Such suspension or queue system shall end on the day following the first Business Day on which theconditions giving rise to the suspension or queue system shall in the opinion of the ManagementCompany have ceased to exist and no other condition under which suspension or queue system isauthorized under the Deed exists. In case of suspension and invoking a queue system and end ofsuspension and queue system, the Management Company shall immediately notify the SECP andTrustee and publish the same in at least two daily newspapers, one in English and one in Urdu, havingwide circulation in major cities of Pakistan.
3.10 Risk
Investors may realize that all investments involve risk. It should be clearly understood that the portfolioof UTP – Islamic Fund is subject to market fluctuations and risk inherent in all such investments. Thevalue of the units in UTP – Islamic Fund may appreciate as well as depreciate, as well as the level ofdividend declared by UTP – Islamic Fund may go down as well as up. Past performance does notnecessarily indicate future performance.
Investments will initially be in the stock market. The investment exposure in each company may beupto fifteen percent of the net assets and each sector may be upto thirty percent of the net assets,resulting in the market fluctuations to have a higher impact on the prices of UTP – Islamic Fund.
Investments in Term Finance Certificates will be on a profit and loss basis and there is a possibilitythat the net result from such investments may be a loss.
Also all Investments made by the UTP – Islamic Fund will be made in adherence with the principlesof Shariah. It is possible that the effect of Shariah Guidelines placed on investments may result in theFund performing differently to funds with similar objectives, but which are not subject to Shariah review.
The portion of the income that accrues in the Fund from non-Shariah compliant sources (i.e. Haramincome) will be distributed as Charity by the fund on authorization of the Unit Holders. Such distributionsshall lower the net amount available for distribution to the Unit Holders as dividends.
3.11 Disclaimer
All investments in mutual funds and securities are subject to market risks. Our target return/ dividendrange cannot be guaranteed. UTP-Islamic Fund's unit price is neither guaranteed nor administered/managed. It is based on the NAV, that may go up or down depending upon the factors and forcesaffecting the stock market. It is possible that the Shariah Guidelines placed on investments may resultin the Fund performing differently to funds with similar objectives, but which are not subject to Shariahreview. Past performance is not necessarily indicative of future results.
3.12 Offering Document
The provisions of the Trust Deed govern this Offering Document. It sets forth information about UTP– Islamic Fund that a prospective investor should know before investing in any unit. Prospectiveinvestors should consult their stockbroker, bank manager, legal adviser or other financial adviser.
3.13 Information given in this Document, Responsibility of Management Company
ABAMCO accepts the responsibility for the information contained in this Offering Document as beingaccurate at the date of publication.
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13
Core Investors No. of units Rupees
Abbott Laboratories Pakistan Ltd.- Provident Fund 10,000 5,000,000
Abbott Laboratories Pakistan Ltd.- Staff Pension Fund 10,000 5,000,000
Central Depositary Company of Pakistan Ltd.- Employees Provident Fund 1,000 500,000
Century Paper & Board Mills Ltd. - Employees Gratiuty Fund 5,000 2,500,000
EFU General Insurance Ltd. 20,000 10,000,000
EFU Life Assurance Ltd. 20,000 10,000,000
Engro Chemical Pakistan Ltd. MPT Employees Pension Fund 10,000 5,000,000
Engro Chemical Pakistan Ltd. - Provident Fund 10,000 5,000,000
Mr. Illyas Katchi (Proprietor of Katchi Line) 400 200,000
International General Insurance Company of Pakistan Ltd. 2,000 1,000,000
Jahangir Siddiqui Investment Bank Ltd. - Provident Fund 300 150,000
ORIX Investment Bank Ltd. 10,000 5,000,000
ORIX Leasing Pakistan Ltd. - Employees Provident Fund 5,000 2,500,000
Pak Kuwait Investment Company (Pvt.) Ltd. 12,100 6,050,000
Pakistan PTA Management - Staff Gratuity Fund 2,000 1,000,000
Pakistan PTA Management - Staff Pension Fund 2,000 1,000,000
Pir Mohammad A. Kaliya 200 100,000
Total 120,000 60,000,000
PART IV – ORGANIZATION AND MANAGEMENT
4.1 Core Investors
The Core Investors of UTP – Islamic Fund are the following, who have subscribed the amount asstated against their names.
The Core Investors have agreed to hold their investment for a minimum period of two years from thedate of payment in full of such units. The units can be transfered, subject to the condition that thesemust be held for the remaining period of two years.
4.2 Management Company
(a) Shareholders: ABAMCO was incorporated on February 22, 1995 and registered as an investmentadviser and an asset management company with the SECP (formerly the Corporate Law Authority)on February 27, 1995 and August 29, 1995 respectively. ABAMCO is presently managing thevBSJS Balanced Fund Limited (BBF), a close-end mutual fund, listed on the Karachi Stock
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Exchange (KSE), Unit Trust of Pakistan (UTP), an open-end mutual fund, listed on the LahoreStock Exchange (LSE), UTP – Income Fund (UTP-IF), an open-end mutual fund, listed on theLSE and twelve ICP Mutual Funds (ICP Mutual Funds Lot A), listed on Karachi, Lahore andIslamabad Stock Exchanges whose management right was transferred to ABAMCO, underManagement Right Transfer Agreement, dated October 11, 2002, among ABAMCO, InvestmentCorporation of Pakistan and Privatisation Commission. The total net assets of the funds underthe management of ABAMCO is Rs. 3.5 billion. The paid up capital of ABAMCO is Rs 81.9million, held by:
1) Jahangir Siddiqui & Co. Limited (JSCL) – 54.98%2) AIM Global Ventures, Inc., (AIM) – 16.48%3) International Finance Corporation (IFC) – 10.99%4) Muslim Commercial Bank Limited (MCB) – 6.98%5) Saudi Pak Commercial Bank Limited (SPCB) – 5.50%6) Mr. William H. Kleh - 4.95%7) Mr. M. Habib ur Rahman – 0.12%
1) Jahangir Siddiqui & Co. Limited (“JSCL”) is a leading financial services organization. Thefirm’s businesses are equity securities brokerage fixed income sales and trading, corporatefinance, research, investment banking (via Jahangir Siddiqui Investment Bank Ltd.) and fundmanagement (via ABAMCO Limited). The Pakistan Credit Rating Agency (Pvt.) Limited (PACRA),an affiliate of Fitch Credit Agency England, has assigned both the long term and short termratings of the Company at AA (Double A) and A1+ (A one plus) respectively. Euromoney, in its“Euromoney Awards for Excellence 2000” declared JSCL as the best domestic securities house.JSCL also received the KSE Top 25 Companies Award in 1998. As on September 30, 2002,JSCL had shareholders equity of Rs. 947.011 million making it the largest publicly listed securitiesfirm in Pakistan.
2) AIM Global Ventures, Inc., a Cayman Island corporation, is an indirect wholly owned subsidiaryof AMVESCAP PLC, the U.K. holding company created through the merger of AIM ManagementCompany Group Inc. with and into a subsidiary of INVESCO PLC. AMVESCAP PLC is one ofthe world’s largest asset managers, with approximately $400 billion in assets under managementand with over 8,600 staff employed worldwide. Through its subsidiary companies AMVESCAPPLC conducts operations in North and South America, Europe, Asia and Australia, with majoroffices in Atlanta, New York, Houston, Toronto, London, Dublin, Paris, Frankfurt, Brussels, Milan,Tokyo, Hong Kong, Melbourne and Buenos Aires. AMVESCAP PLC and its subsidiaries provideinvestment management and related services to a wide range of institutional and retail clients,including regulated investment companies and other pooled investment schemes. Theseinvestment products are sold under the “AIM” and “INVESCO” brand names. AMVESCAP PLCis listed on the London Stock Exchange.
3) International Finance Corporation (IFC) is a member of the World Bank Group, which isa multilateral development organization, and is headquartered in Washington, DC. The IFC wasestablished in 1956 and promotes sustainable private sector investment in developing countriesas a way to bring economic development and to improve the quality of the lives of people in itsdeveloping member countries. IFC is the largest multilateral source of loan and equity financingfor private sector projects in the developing world. Its equity capital is provided by its membercountries, both developed and developing, which collectively determine its policies and activities.
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IFC promotes sustainable private sector development primarily by:
• Financing private sector projects located in the developing world.
• Helping private companies in the developing world mobilize financing in internationalfinancial markets.
• Providing advice and technical assistance to businesses and governments.
4) Muslim Commercial Bank Limited (MCB) is the largest private sector commercial bank in thecountry having deposits of over Rs. 162 billion and more than 4.3 million account holders. MCBalso has a substantial balance sheet footing of over Rs. 194 billion.
MCB has the largest ATM and On-line branches network in Pakistan with over 110 ATMs and200 on-line branches all over the country. Additionally, MCB MNET has provided an accessibilityplatform to its ATM network to several member banks.
MCB focuses on creating and managing value by providing new products, which will result in acontinuous leadership in the banking sector.
5) Saudi Pak Commercial Bank Limited is a subsidiary of Saudi Pak Industrial and AgriculturalInvestment Company (Private) Limited (Saudi Pak), which was established in 1981 by theGovernments of the Kingdom of Saudi Arabia and the Islamic Republic of Pakistan, primarily topromote industrial development in Pakistan.
6) Mr. William H. Kleh, (please see under paragraph 4.2(c)(4))
7) Mr. Mohammad Habib-ur-Rahman, (please see under paragraph 4.2(c))
(b) The Board of Directors of the Management Company
Chief ExecutiveBSJS Balanced Fund Ltd.Security Fund Management Ltd.DirectorAllwin Engineering Industries Ltd.Jahangir Siddiqui Investment Bank Ltd.
DirectorBSJS Balanced Fund Ltd.Jahangir Siddiqui & Co. Ltd.
Chairman/ Chief Executive
1) Mr.Mohammad Habib-ur-RahmanBusiness Executive
7/II 22nd Street,Off. Khayaban-e-Tanzeem
` Phase V, D.H.A.,Karachi -75500.
Executive Director
2) Mr. Ali J. SiddiquiBusiness Executive
D/185 Block 5CliftonKarachi-75600
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ChairmanJahangir Siddiqui Investment Bank Ltd.Jahangir Siddiqui & Co. Ltd.
ChairmanIbrahim Fibres Ltd.DirectorBSJS Balanced Fund Ltd.First Women Bank Ltd.Ibrahim Agencies (Pvt.) Ltd.Ibrahim Enterprises (Pvt.) Ltd.Ibrahim Software (Pvt.) Ltd.Muslim Commercial Bank Ltd.
Directors
3) Mr. Mazhar ul Haq SiddiquiEducationalist & Civil Servant
Vice ChancellorUniversity of SindhVice Chancellor’s HouseVice Chancel lor ’s RoadJamshoro.
4) Shaikh Mukhtar AhmedBusiness Executive
3, Race Course Road,Faisalabad.
Chief ExecutiveJahangir Siddiqui & Co. Ltd.DirectorBSJS Balanced Fund Ltd.EFU Life Assurance Ltd.Security Fund Management Ltd.
DirectorAIM Capital Funds PLCAIM Capital Management Ltd.American School In London Educational Trust Ltd.
ChairmanBSJS Balanced Fund Ltd.Ryan Agencies (Pvt.) Ltd.Security Fund Management Ltd.
5) Mr. Munaf IbrahimBusiness Executive
B-55, Block B, Street 6,S.M.C.H.S.,Karachi-74400
6) Mr. William H. KlehBusiness Executive
66, Chelsea Park GardensLondon SW3-6AF,United Kingdom.
7) Mr. Abid Hussain ZuberiBanker
B-19, Overseas BungalowsSector 16-A,Gulistan-e-Johar,Karachi.
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(c) Particulars of the Directors
Chairman and Chief Executive:
Mr. Mohammad Habib-ur-Rahman
Mr. Mohammad Habib-ur-Rahman joined ABAMCO in 1995 as the Chief Executive. He became the Chairmanin 2002. He has previously worked for the National Investment Trust Limited from 1971 to 1981 as Headof Investment and Finance. He has worked for over thirteen years with Atlas Honda Limited, a joint venturewith Honda Motor Company of Japan, in various capacities as Director of Finance, Commercial, DataProcessing and Production.
Mr. Habib-ur-Rahman is a Fellow of the Institute of Chartered Accountants in England & Wales and theInstitute of Chartered Accountants of Pakistan. He has attended many seminars and courses conductedby the Pakistan Institute of Management, Economic Development Institute of the World Bank, PakistanAdministrative Staff College, the International Institute of Islamic Banking and Economics, Cairo and HarvardBusiness School. He has taught at the evening program of the Institute of Business Administration, Karachi.He has been on the board of the Karachi Stock Exchange (KSE) for many years. SECP has nominated himas director for KSE for the year 2003. He is the Vice Chairman of Mutual Funds Association of Pakistan( MUFA P) . He is also serving as a member of the SECP Consultive Group on the capital markets.
Mr. Habib-ur-Rahman has been appointed as Chief Executive Officer of ABAMCO with the approval of theSecurities & Exchange Commission of Pakistan. As the chief executive of the first asset managementcompany in the private sector in Pakistan, Mr. Habib ur Rahman has played an important role in gettinglevel playing field for private sector mutual funds.
Executive Director:
Ali J. Siddiqui
Mr. Siddiqui joined ABAMCO in 2002. Mr. Siddiqui was previously based in Hong Kong with Crosby, aninvestment banking firm. Prior to Crosby, he was an Associate with Techpacific Capital where he was partof a team that managed approximately USD 100 million in private equity funds, investing primarily in HongKong, the People’s Republic of China, South Korea and Singapore.
Mr. Siddiqui holds a Bachelor degree in Economics from Cornell University (accelerated graduation).
DirectorSecurity Fund Management Ltd.Confidance Financial Services Ltd.
Company Secretary
8) Syed Owais WastiR 128 Block 6,Gulshan Iqbal,Karachi-75350
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Other Directors:
1. Mr. Mazhar ul Haq Siddiqui
Mr. Mazhar ul Haq Siddiqui is an eminent civil servant and educationist. He has held many senior positionsin the Government of Pakistan. He joined Income Tax Department in 1957 and served in various capacitiesincluding the Commissioner of Income Tax. He served the Provincial Governments as Secretary Education,Finance and Service and General Administration. He has served the Federal Government as Secretary inEstablishment, Economic affairs, Education, Management Services, Economic Affairs, Statistics, and YouthAffairs Divisions.
He was Vice Chancellor, Sindh University for four years (1984-88) and on rejoining Sindh University in July2001, he has been appointed Vice Chancellor, a position which he currently holds. He has also held theposition of Chairman, National Insurance Corporation and Member, Federal Public Services Commission.
2. Shaikh Mukhtar Ahmed
Shaikh Mukhtar Ahmed, who is representing Muslim Commercial Bank Ltd on the Board, is a leadingbusinessman of the country. He is the Chairman of Ibrahim Group of companies having about 48 years ofexperience in the business and industry. Shaikh Mukhtar Ahmed entered in the financial sector field in 1993and established First Ibrahim Mudarabah and Ibrahim Leasing Ltd. In 2001, First Ibrahim Mudarabah wasmerged with Ibrahim Leasing Ltd. He also established Ibrahim Textile Mills Ltd, A.A. Textiles Ltd, ZainabTextile Mills Ltd, Ibrahim Energy Ltd and Ibrahim Fibres Ltd. The textile spinning units and power generatingunit have now been merged into Ibrahim Fibres Ltd.
3. Mr. Munaf Ibrahim
Mr. Munaf Ibrahim, the Chief Executive of Jahangir Siddiqui & Company Limited (JSCL) is a CharteredAccountant by profession and also a Fellow Member of the Institute of Cost & Management Accountantsof Pakistan. He has been associated with the company for nearly a decade. His initial assignments in thecompany were that of Manager Finance and Company Secretary. In 1995 he became an Executive Directorand held that position till September 1999 when he became the Chief Executive of JSCL.Mr. Ibrahim has also held the directorship of Jahangir Siddiqui Investment Bank Limited. He is a memberof various committees of the Karachi Stock Exchange and Securities and Exchange Commission of Pakistan.These committees are in place so as to improve the overall performance of the Stock Exchange as a tradingbody.
4. Mr. William H. Kleh
Mr. William H. Kleh is a citizen of the United States residing in London, where he currently engages invarious consulting and private investment-related activities.
Mr. Kleh was qualified in several U.S. jurisdictions as an attorney and, prior to his retirement in April 1999,served as General Counsel and Senior Compliance Officer of AMVESCAP, PLC, the U.K. holding companyformed by the merger in February 1997 of AIM Management Group Inc. and INVESCO PLC. Prior to themerger Mr. Kleh served as Managing Director of AIM Global Advisors Limited, AIM’s U.K. subsidiary companyand IMRO-regulated investment adviser to a number of investment companies sponsored by AIM and soldto investors outside the United States.
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Mr. Kleh is presently a director of the Dublin-based AIM Capital Funds and of AIM Capital ManagementCompany Limited, the manager of those funds. Prior to 1994 Mr. Kleh served as general counsel of AIMManagement Group Inc.
5. Mr. Abid Hussain Zuberi
Mr. Abid Hussain Zuberi is a graduate from Aligarh Muslim University. He is a career banker. He joinedHabib Bank Limited in October 1947 and moved to Muslim Commercial Bank Limited (MCB) in 1951. Heserved the bank in the capacity of Circle Executive, Provincial Chief and finally promoted to Senior ExecutiveVice President from where he retired in 1987. In 1982 he was sent to the Allied Bank of Pakistan Limitedas Director of the bank and Member Executive Board. He was elected Fellow of the Institute of Bankers inPakistan in 1982.
Company Secretary
Syed Owais Wasti
Syed Owais Wasti is an Associate Member of the Institute of Cost & Management Accountants of Pakistan.He has been with ABAMCO since October 1997 and is presently the Head of the Finance Department andCompany Secretary. He has previously worked with UDL Distribution Limited, and Jahangir Siddiqui & Co.Ltd.
(d) Duties and Responsibilities of the Management Company
(i) The responsibilities of the Management Company is to promote the sale of Units in UTP – IslamicFund, invest and manage the assets of UTP – Islamic Fund according to the provisions of theDeed, in good faith, to the best of its ability and without gaining any undue advantage for itselfor any Connected Persons.
(ii) The Management Company shall maintain proper accounts and records of UTP – Islamic Fundto enable a complete view of assets and liabilities, income and expenditure and amounts receivedin respect of Units and paid out on redemptions of Units and by way of distribution.
(iii) The Management Company shall prepare and transmit to Unit Holders and SECP the annualreport together with balance sheet and income and expenditure account and auditors report.The Management Company shall also prepare and transmit to Unit Holders and SECP thebalance sheet and income and expenditure account in respect of first quarter, third quarter andfirst half of the year.
(iv) The Management Company shall make available to the Trustee all information relating to theFund. The Management Company shall account to Trustee for any loss in value of the assetsof UTP – Islamic Fund caused by its negligence.
(v) The Management Company shall be responsible for all acts and omissions of all persons oragents to whom it may delegate the performance of its duties, as if these were its own acts andomissions.
(vi) The Management Company shall instruct the Trustee purchase, including placement of cashand sale of investments.
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(vii) The Management Company shall, if it considers necessary, request the Trustee in writing, forthe protection of Deposited Property or safeguarding the interest of the Unit Holders, to instituteor defend any suit, proceeding, arbitration or inquiry or any corporate or shareholders’ actionin respect of the Deposited Property or any part thereof.
(viii) The Management Company shall not be under any liability except such liability as may beexpressly assumed under the Rules and the Deed nor shall the Management Company (saveas otherwise provided) be liable for any act or omission of the Trustee nor for anything exceptits own negligence or wilful breach of duty.
(ix) The Management Company has the primary responsibility for all record keeping, regulardetermination and announcement of Unit’s prices and for producing financial reports from timeto time as provided in the Rules and the Trust Deed.
(x) The Management Company shall appoint a Shariah Advisory Council, with the approval of SECP,and work in coordination with the Shariah Advisory Council to ensure that all the acts of the UTP– Islamic Fund are in compliance with Shariah.
(xi) The Management Company shall ensure that all the necessary approvals have been obtainedfrom the Secretary to Shariah Advisory Council or the Shariah Advisory Council, as the casemay be, in respect of transactions involving Shariah related matters and that the above mentionedapprovals are properly documented.
4.3 FUNDS UNDER MANAGEMENT
ABAMCO is currently managing BSJS Balanced Fund, a closed end mutual fund and two open-endedmutual funds, Unit Trust of Pakistan and UTP- Income Fund. ABAMCO is also managing twelve ICPMutual Funds (ICP Mutual Funds Lot A), whose management right was transferred to ABAMCO, underManagement Right Transfer Agreement, dated October 11, 2002, among ABAMCO, InvestmentCorporation of Pakistan and Privatisation Commission. The total net assets of the funds under themanagement of ABAMCO is Rs. 3.5 billion.
BSJS BALANCED FUND LIMITED
BSJS Balanced Fund Limited (BBF) is a closed-end mutual fund with and investment strategy thatmakes it a balanced fund. This fund was incorporated on March 26, 1994 and commenced businessfrom August 08, 1995. BBF's shares were offered for public subscription on January 14, 1996 with apaid up capital of Rs. 150 million. It was listed on the Karachi Stock Exchange on March 03, 1996.
Confidence Mutual Fund Limited, whose management was acquired by ABAMCO on September 04,2000, was merged with BBF w.e.f. July 1, 2000 and paid up capital of BBF was increased to Rs. 250million.
Security Stock Fund Limited (SSF), with a paid up capital of Rs. 100 million which was another mutualfund whose management was acquired by ABAMCO on October 18, 2001, was merged with BBFw.e.f. July 1, 2001 and the paid up capital of BBF was increased to Rs. 340 million. The net assetsof BBF were over Rs. 436 million as on September 30, 2002.
20
UTP-ISLAMIC FUND
OFFERING DOCUMENT
BBF is the top performing closed-end mutual fund and the only one to have been assigned an AA (f)rating by PACRA which denotes the fund's ability to consistently outperform its peers with a strongcapacity to respond to future opportunities or stress situations.
Offer to public on January 14, 1996 at a par value of Rs. 10 only, BBF’s performance is as given inthe following chart:
Period Ended Dividend (%) Total Return (%)June 30, 1996 - 1June 30, 1997 13.00 17.82June 30, 1998 8.00 2.17June 30, 1999 10.00 17.95June 30, 2000 30.50 32.41June 30, 2001 11.00 13.52June 30, 2002 15.00 18.86
BBF’s performance vs. KSE 100 Index
-60%
-35%
-10%
15%
40%
65%
90%
115%
BBF 1.00% 19.00% 21.30% 39.30% 79.50% 86.80% 111.40%
KSE -1.69% -9.66% -49.22% -39.12% -12.21% -21.12% 7.84%
Jun-96 Jun-97 Jun-98 Jun-99 Jun-00 Jun-01 Jun-02
21
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UNIT TRUST OF PAKISTAN
Unit Trust of Pakistan (UTP) is the first open-ended mutual fund in the private sector. UTP wasestablished under a Trust Deed, dated April 26, 1997 and as subsequently amended by a SupplementalTrust Deed dated January 16, 2001, between ABAMCO Limited as the management company andMuslim Commercial Financial Services (Pvt.) Limited, a wholly owned subsidiary of Muslim CommercialBank Limited, as the trustee.
UTP has a balanced fund investment strategy. A balanced fund is a versatile investment program, ina single fund, which enables the investor to achieve diversification and therefore, safety. Through aportfolio of rigorously screened and monitored stocks, debt securities and short-term instruments, abalanced fund gives the investment a chance to perform two important jobs, to grow in value and toproduce income for periodic distribution.
The investment goal of UTP is to provide to its investors long-term capital appreciation and currentincome while at the same time attempting to preserve the invested principal and providing almostimmediate access to the money if investors redeem their units.
The offer for public subscription was made from October 27, 1997, through an Offering Document andas subsequently amended by a Supplemental Offering Document dated January 16, 2001.
UTP continuously offers new units to investors for subscription and the units are open for redemption. The units can also be transferred. The units issued by UTP are listed on the Lahore Stock Exchange.
UTP has been assigned an AA (f) rating by PACRA. The rating denotes the ability of the fund toconsistently perform better than its peers with a strong capacity to respond to future opportunities orstress situations.
UTP’s past performance since the date of commencement is as given in the following chart:
The fund now has an asset base of over Rs. one billion, as of September 30, 2002, and its investorsinclude banks, NBFIs, Insurance companies, Leasing companies, provident/ pension funds, welfareorganizations and individuals.
Period Ended Dividend (%) Total Return (%)June 30, 1998 11.00 16.50June 30, 1999 13.50 14.36June 30, 2000 22.50 27.23June 30, 2001 12.00 9.45June 30, 2002 15.00 18.18
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UTP-ISLAMIC FUND
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UTP's Performance Vs. KSE 100 Index
-60%
-40%
-20%
0%
20%
40%
60%
80%
100%
UTP % 0.00 3.50 6.68 10.26 13.82 18.40 22.44 23.82 31.10 37.62 52.68 53.00 55.76 57.02 58.96 61.42 62.00 65.54 79.90 81.64 86.78
KSE % 0.00 -8.39 -17.17 -53.09 -40.72 -49.59 -43.64 -43.75 -36.04 -24.86 6.65 -18.89 -16.55 -18.00 -29.37 -27.12 -39.55 -32.10 0.64 -5.59 7.67
Dec-
97
Mar-
98
Jun-
98
Sep-
98
Dec-
98
Mar-
99
Jun-
99
Sep-
99
Dec-
99
Mar-
00
Jun-
00
Sep-
00
Dec-
00
Mar-
01
Jun-
01
Sep-
01
Dec-
01
Mar-
02
Jun-
02
Sep-
0297
Oct-
0
2
4
6
8
10
12
14
16
18
20
Returns Based on Various Sale Dates from October 27, 1997*
Returns (%) 16.93 15.39 19.68 16.81 17.10 17.2030/6/98 30/6/99 30/6/00 30/6/01 30/6/02 30/9/02
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UTP- INCOME FUND
UTP-Income Fund (UTP-IF) is the second open-ended mutual fund offered by ABAMCO Limited.UTP-IF was established under a Trust Deed, dated July 18, 2002 between ABAMCO Limited as themanagement company and Muslim Commercial Financial Services (Pvt.) Limited, a wholly ownedsubsidiary of Muslim Commercial Bank Limited, as the trustee.
UTP- IF was launched in August 2002 with a seed capital of Rs. 50 million. The net assets of UTP-Income Fund were over Rs. 239 million, as on September 30, 2002. This fund essentially invests infixed income securities.
The prime objective of UTP-IF is to provide investors a facility to invest through one fund into a rangeof fixed income instruments. It aims to achieve high rate of current income consistent with safety ofcapital while providing investors the convenience to join or leave the fund at their discretion.
Consistent with the investment strategy, UTP-IF invests in a diversified portfolio of investment gradedebt securities, Government Securities, money markets instruments, Carry Over Transactions (COT),spread transactions and underwriting which are normally the exclusive domain of large-scale investors.
Its clients include banks, insurance companies, leasing companies, provident/ pension funds andindividuals.
UTP- IF was listed at the Lahore Stock Exchange on September 4, 2002.
0
2
4
6
8
10
12
14
16
18
Return Based on Various Entry Dates up toSeptember 30, 2002
Returns (%) 15.8 15.36 16.14 11.19 17.22 12.21
27/10/97* 6/7/1998** 19/7/99** 24/7/00** 23/7/01** 22/7/02**
24
* Commencement of public offering ** Dates of re-opening of Register
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ICP- MUTUAL FUNDS - LOT “A”
ABAMCO acquired the management rights of twelve ICP Mutual Funds (ICP 1st. 3rd. 4th. 8th. 11th. 12th.15th. 19th. 20th. 21st. 23rd. and 25th. Mutual Funds) under the management of Investment Corporationof Pakistan (ICP) for Rupees One Hundred and Seventy-Five Million on October 11, 2002. The paidup capital of all these funds is Rupees One Thousand One Hundred Fifty Million (Rs.1,150 million)and the net assets Rupees One Thousand Six Hundred Thirty-Four Million (Rs.1,634 million) as onOctober 31, 2002. ICP was managing the funds under ICP Ordinance 1966. Consequent upon thetransfer of management rights to ABAMCO, the funds will have to be brought under InvestmentCompanies and Investment Advisers Rules, 1971, regulated by SECP within a period of six monthsfrom the date of change of management. Immediately upon taking over the management, ABAMCOsubmitted application to SECP for merger of the funds under a Scheme for Amalgamation and bringingthe merged mutual fund under the regulation of SECP.
4.4 Shariah Advisory Council
The Shariah Advisory Council has a pivotal role in the performance of UTP – Islamic Fund, as itsguiding influence on the investment policy will determine the credibility of the Fund as a Shariahcompliant investment vehicle. The Shariah Advisory Council comprises of persons who not only enjoyconsiderable eminence in the area of Islamic Economics, but also have considerable experience insuch capacity.
(a) The Shariah Advisory Council will be composed of three persons, who must be experts onShariah and have good understanding of Finance.
(b) The Management Company shall designate the members of the Shariah Advisory Council. Oneof the members will be designated as Chairman. The Shariah Advisory Council will be appointedfor a period of one year, but may be reappointed on completion of their term. The ManagementCompany can at any time remove a member of Shariah Advisory Council before the completionof the term and fill the casual vacancy.
(c) Shariah Advisory Council will advise the Management Company on matters relating to Shariah-compliance and recommend general investment guidelines, consistent with the Shariah. Anyverdict or Fatwa issued by the Shariah Advisory Council in respect of any Shariah relatedmatter would be final and acceptable by the Trustee, the Management Company, the Holdersand other parties related with that matter.
(d) The Management Company will appoint and remove the members of Shariah Advisory Council,with the approval of SECP.
The responsibilities of the Shariah Advisory Council will be as under:
i. Determining that the Scheme’s activities comply with the principles of Shariah in all respects;
ii. Communicating to the Management Company any of its findings regarding compliance withthe Shariah of the Fund’s investments within one month upon receipt of all relevant informationand documentation;
iii. Advising the Management Company the criteria for selection of securities and companieswhere the Scheme may invest;
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iv. Establishing principles for calculating, where applicable, and determining an appropriatepercentage of income and cash flows by companies in which the Scheme has investedfrom activities not in accordance with the principles of the Shariah, i.e. the income is notHalal, and recommending to the Management Company the criteria for selecting the Charitiesto whom such sums shall be donated;
v. Preparing yearly report of the Scheme’s compliance with the principles of Shariah forinclusion in the Fund’s financial reports.
(e) The quorum for the meeting of the Shariah Advisory Council will be two members, attendingeither in person or over the telephone.
(f) The first Shariah Advisory Council is from the Aleemiyah Islamic Missionary University, IslamicCentre, Abdul Aleem Siddiqui & Islamic Centre Roads, Block ‘B’, North Nazimabad, Karachi -74700. The Shariah Advisory Council is composed of Mr. Wasiul Hasan Ansari, as Chairmanand Secretary, Prof. Maulana Abu-Faheem Anwarullah Bin Wali and Mr. Mustafa Fazil Ansari,as Members, who were appointed on September 1, 2002.
(g) Aleemiyah Islamic Missionary University
The Late Dr. Muhammad Fazlur Rahman al-Ansari al-Qadri, the founder President of WorldFederation of Islamic Missions formed the concept of Aleemiyah Islamic Missionary University,when in 1958, he introduced short courses on Islam in English to facilitate the students comingfrom Africa, United Kingdom, Canada and West Indies. The courses continued to progress andthe University assumed a formal shape at the campus of Islamic Centre in July 1964.
The University, owning to its unique educational program and dynamic approach to serve thecause of Islam and to spread its message all over the world, has established its reputation inthe different parts of the world and students from all over the world are enrolled in its educationalprograms.
Besides the degrees conferred by the University in Islamic Learning, the students are also givenall possible facilities to obtain the modern degrees (such as B.A., M.A., or Ph.D.) according totheir interest and abilities from the University of Karachi. Arabic and English languages areemployed as a medium of instruction in the University. Subjects of Islamic Learning are taughtin Arabic, while modern subjects are taught in English.
This University was established to prepare such missionaries of Islam who may carry the Messageof Islam successfully to the whole world. In order to do so successfully, there was a need forsuch missionaries to be fully equipped with the Islamic Leaning as well as modern thoughts.
The first step in this direction was the designing of a six-year graduation course consisting ofIslamic Learning and modern philosophical and social thoughts to enable the Ulema to knowfirst hand the problems, the doubts and the difficulties, which confront the modern mind, andto present their solutions in the light of Islam.Another distinctive feature of this University is the adoption of the English Language, side byside, with Arabic Language as the medium of the instruction.
Aleemiyah Islamic Missionary University is an educational project of The World Federation ofIslamic Missions. The World Federation of Islamic Missions is a socio-religious international
UTP-ISLAMIC FUND
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missionary organization that was established in 1958 by the Late Maulana Dr. Muhammad FazlurRahman al-Ansari al-Qadri. Its headquarters are situated at the Islamic Centre, North Nazimabad,Karachi. The main objective of this organization is to serve in all parts of the world through theexposition, propagation and implementation of teachings and ideas of Islam. There are morethan 38 affiliated organizations of The World Federation of Islamic Missions in different countriesof the world.
The Islamic Research and Publications Bureau of this organization has to its credit more thanfifty publications in Islamic Literature, in both English and Urdu languages, circulating all overthe world. The Bureau also publishes the monthly journal “The Minaret” Monthly International,which is being published since 1964 and contains articles on different aspects of Islam andIslamic way of life.
(h) Particulars of the Members of the Shariah Advisory Council
The Shariah Advisory Council is composed of three persons, who are experts on Shariah andhave good understanding of Finance.
Chairman and Secretary:
Mr. Wasi-ul-Hasan AnsariMr Wasi-ul-Hasan Ansari is currently the Vice President of The World Federation of IslamicMissions. He holds a Bachelors degree, is a Hafiz-ul-Quran and a Fazil Dars-e-Nizami. He alsoworks as the Chief Editor of the “Minaret”, a monthly international magazine published by TheWorld Federation of Islamic Missions.
Mr. Ansari has done the subject wise compilation of the Holy Quran with translations, both inEnglish and Urdu. He has participated in various talks on the Radio on religious subjects andIslamic History. Mr. Ansari has also written books on the fol lowing subjects:
� Anthology of Traditions of the Holy Prophet (S.A.W.S) – (of Trade and Commerce)
� Anthology of Traditions of the Holy Prophet (S.A.W.S) – (of Social Life and Behaviour)
� Lexicon of Pilgrimage Terms.
Mr. Ansari has held important positions in the Federal Government, spanning over thirty-fiveyears in the Ministry of Information and Ministry of Religious Affairs and has held postings abroad,including diplomatic assignments, in Cairo, Kabul and Jeddah.
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Other Members:
Prof. Maulana Abu-Faheem Anwarullah Bin Wali
Prof. Maulana Abu-Faheem Anwarullah Bin Wali is presently the Principal Islamic Centre, ofAleemiyah Islamic Missionary University, Karachi. He holds a Masters Degree in Arabic fromthe Karachi University and a Masters Degree in Tafseer from the Aleemiyah Islamic MissionaryUniversity. He is a Hafiz-ul-Quran, Fazil Dars-e-Nizami, Fazil (Arabic) Lahore and Fazil (MadinaUniversity).Prof. Maulana Abu-Faheem Anwarullah Bin Wali has been teaching Tafseer, Hadith and otherIslamic Sciences in the Aleemiyah Islamic Missionary University since 1962. He has alsoperformed missionary work in Africa, America and Europe.
He is also the Khateeb and Qazi of the Jamia Masjid Al-Noor, Allama Iqbal Road, P.E.C.H.Sand the Advisor for AlHabl, a computer software firm.
Mr. Mustafa Fazil Ansari
Mr. Mustafa Fazil Ansari, hold a Bachelors Degree in Science from Karachi University andMasters in Business Administration from the Institute of Business Administration, Karachi. Hehas also attended numerous professional Aviation Management courses and seminars at thePIA Training Centre, Karachi Airport.
Mr. Ansari has an Aviation Marketing and Management experience of over thirty-two years. Hehas held assignments abroad as PIA’s regional head at Saudi Arabia, Northern Europe andPeoples Republic of China. He has also served as Chairman of IATA’s representative bodiesin Pakistan, Chairman of Board of Airline’s Representative in Pakistan and Governing memberof the Boards of Directors of Pacific Area Tourism and Transport Association, USA, besidesmany other coveted positions.
Mr. Ansari has also served as an Honorary Director in charge of various projects in The WorldFederation of Islamic Missions since 1974. Presently he is serving as the Honorary GeneralSecretary of the Organization. He is the successor of Maulana Dr. M. Fazalur Rahman Ansari.
4.5 Secretary to Shariah Advisory Council
(a) One of the members of the Shariah Advisory Council will act as a Secretary to Shariah AdvisoryCouncil who will look after the day-to-day Shariah requirements of the Unit Trust operations andwill gather and prepare matters to be put to the Shariah Advisory Council for its opinion, verdict,Fatwa, advice and decision.
(b) Role of Secretary to Shariah Advisory Council
The Secretary to Shariah Advisory Council will play the following role:
i Advise on the Shariah compliance requirements in respect of each kind of scheme.
ii Ensure that the documentation, being used for various transactions, is in conformity with Shariah.
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iii Approve the modes of investments in light of Shariah requirements.
iv Provide necessary training to the management and staff, relating to Shariah requirements.
v Arrange search of solutions to problems faced by professionals, by referring such problems tosenior scholars in Islamic Shariah or resorting to the findings of classical jurists, that are availablein Islamic literature or referring the same to the Shariah Advisory Council.
vi The decision of the Secretary to Shariah Advisory Council relating to any point on a principleof Shariah would prevail, unless a clarity is obtained from the Shariah Advisory Council or onthe recommendation of the Shariah Advisory Council from the higher panel of scholars, competentto give a Fatwa/ Clarity in such cases.
4.6 Shariah Compliance Auditor
(a) The external auditor of the Unit Trust will also act as Shariah Compliance Auditor, and willcomplete the Shariah Compliance Audit of the Trust for each Accounting Period within fourmonths from the relevant Accounting Date, and will issue a Shariah compliance audit report.
(b) The Shariah Compliance Auditor would verify the following aspects of the Unit Trust’s activities:
i. Necessary approvals have been obtained from the Secretary to Shariah Advisory Councilor Shariah Advisory Council, as the case may be, in respect of transactions involving Shariahrelated matters.
ii. Documentations contain all necessary information to make it Shariah compliant.
iii. No mis-use of Trust funds has been committed.
iv. Trust funds were placed for investment under Shariah compliant avenues.
v. Costs charged to Trust funds were in accordance with the Shariah permissions and termsof the Trust Deed.
vi. Share of the Modharib in profits from investments and the fees paid to the Trustee and theManagement Company are in accordance with the agreed rates.
vii. Distributions for the Unit holders are in the accordance with the terms agreed upon.
viii. Any other point effecting the Shariah compliance.
ix. The Shariah compliance auditor will base his audit on tests usually applied in practice.
x. The statements of accounts/ notes thereon comply with the requirements of the Accounting,Auditing and Governance Standard for Islamic Financial Institutions (AAGSIFI) as applicableto investment funds, issued by Accounting and Auditing Organization for Islamic FinancialInstitutions (AAOIFI).
xi. Disclosure shall be made in the notes to the financial accounts, of earnings prohibited by
UTP-ISLAMIC FUND
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Shariah, if any, and how those amounts are disposed of. Disclosure shall also be made ofany amounts paid for purposes not permitted by Shariah.
xii. Disclosure shall be made of whether the Zakat payment is the responsibility of the Fundor the responsibility of Unit Holders. The fund shall also disclose the Zakat due for eachshare/ unit.
(c) The Shariah Compliance Auditor should be competent to carry out the Shariah compliance audit,including that the audit firm should have experience or the requisite knowledge of conducting
Shariah compliance audits and should have laid down the system and program tocarry out such audit.
4.7 Trustee: Duties and Responsibilities
i) The Trustee will take into custody and under its control all the property of UTP – Islamic Fundand hold it in trust for the Unit Holders and the cash and registerable assets shall be registeredin the name of, or to the order of the Trustee.
ii) The Trustee will carry out the instructions of the Management Company in all matters includinginvestment and disposition of the Deposited Property, unless they are in conflict with the TrustDeed and the Offering Documents.
iii) The Trustee shall exercise all due diligence and vigilance in carrying out its duties and in protectingthe interests of the Unit Holders.
iv) The Trustee shall ensure that all issues and cancellations of Units of UTP – Islamic Fund and the method adopted by the Management Company in valuing Units for the purposes of determiningthe Offer and Redemption Prices are carried out in accordance with the provisions of the Deed.
v) The Trustee shall issue a report to the Unit Holders to be included in the annual report, whetherin its opinion, the Management Company has in all material respect managed the DepositedProperty in accordance with the provisions of the Rules and the Trust Deed and if the ManagementCompany has not done so, the respect in which it has not done so and the steps the Trusteehas taken in respect thereof.
vi) The Trustee shall institute or defend any suit proceedings, arbitration or inquiry or any corporateor shareholders action in respect of the Deposited Property or any part thereof if so requestedby the Management Company in writing.
vii) The Trustee shall be responsible for all acts and omissions of all persons or agents to whom itmay delegate the performance of its duties, as if these were its own acts and omissions.
viii) The Trustee shall account for any loss in value of the Deposited Property where such loss hasbeen caused by negligence or any reckless or willful act and/ or omission of the Trustee or anyof its director, officers, nominees or agents.
UTP-ISLAMIC FUND
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ix) The Trustee shall not be under any liability on account of anything done or suffered by UTP –Islamic Fund in good faith in accordance with or in pursuance of any request of the ManagementCompany provided they are not in conflict with the provisions of the Trust Deed or the Rules.
x) In order to ensure Shariah Compliance in all the operations, activities and documentations ofthe Trust Fund, the Trustee will utilize the services of the Shariah Advisory Council appointedby the Management Company and shall ensure that all the necessary approvals have beenobtained from the Secretary to Shariah Advisory Council or Shariah Advisory Council, as thecase may be, by the Management Company in respect of transactions involving Shariah relatedmatters.
4.8 Transfer Agent
The Management Company has appointed Technology Trade (Pvt.) Limited as the Transfer Agent.They will be responsible for maintaining the Unit Holders’ Register, preparing and issuing AccountStatements, Unit Certificate(s) and dividend warrants, and providing related services to the Unit Holders.Technology Trade (Pvt.) Limited has the facilities to provide efficient service to UTP – Islamic Fund.
4.9 Distribution Companies
a) ABAMCO Ltd, Jahangir Siddiqui & Co. Ltd (JSCL), Jahangir Siddiqui Investment Bank Ltd (JSIBL),Muslim Commercial Bank Limited (MCB), PICIC Commercial Bank Limited, The Bank of Khyberand Kontinental Consultants Inc. have each been appointed as a Distribution Company to performthe Distribution Functions at their Authorized Branches. The addresses of these branches aregiven in Part XVI of this Offering Document.
b) The Distribution Companies will be responsible for receiving applications for issuance of Unitsand redemption/ transfer applications. They will be interfacing with and providing service to UnitHolders, including receiving application for change of address and other particulars or applicationfor issuance of duplicate unit certificates for immediate transmission to the Management Company,the Trustee or Transfer Agent as appropriate.
c) The branches have been equipped with the necessary support staff, computer hardware andsoftware to provide service to the investors and have established an efficient communicationlink with the Trustee, Management Company and the Transfer Agent.
d) During the Initial Period only ABAMCO will be the Distribution Company. The appointment ofothers will commence after the close of the Initial Period.
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4.10 Auditors
The Auditors of UTP – Islamic Fund are:
Ford Rhodes Sidat Hyder & Co.First Floor, Finlay HouseI.I. Chundrigar RoadKarachi.
They will hold the office until the transmission of the reports and accounts, which will cover the periodfrom December 16, 2002 to June 30, 2003 and will be eligible for re-appointment by the ManagementCompany, as provided in the Rules.
4.11 Legal Advisers
The legal advisers of UTP – Islamic Fund are:
Bawaney & Partners205-208, Imperial Hotel BuildingQ.R.5, Queens RoadKarachi-75530, Pakistan
4.12 Bankers
No bank accounts will be opened and operated without prior clearance from Shariah Advisory Council.
The Bankers of UTP – Islamic Fund are Muslim Commercial Bank Limited, with whom the Trusteehas opened a current account. Meezan Bank Limited and AlBaraka Islamic Bank, which are IslamicBanks, and cleared by the Shariah Advisory Council, will also be the bankers of UTP – Islamic Fund.The Trustee will operate the bank accounts on instructions of the Management Company.
PART V – PRINCIPAL FEATURES
5.1 Features of Units to be offered
a) 120,000 units of the value of Rupees 60 million have been subscribed by the Core Investors atPar Value. Please refer to paragraph 4.1. During the Initial Period, units will also be issued atPar Value without Sales Load. No redemption will be allowed during the Initial Period.
b) After the Initial Period, Units issued will carry a Front end Load amounting to two percent (2%)of the Net Asset Value (NAV), which shall be added to the Net Asset Value to calculate the OfferPrice. Units will be redeemed at NAV.
c) Sales Load is intended to cover cost of issue, transfer, and redemption of units, including salespromotion.
d) Unit Holders will have the option to convert the dividend amount into Units. Please refer toparagraph 10.5 of this Offering Document.
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5.2 Purchase and Redemption of Units
a) Units can be purchased at the Offer Price and redeemed at the Redemption Price at any of theAuthorized Branches of the Distribution Company(s) on any Subscription Day, which will be fromMonday to Thursday of each week in accordance with the procedure set out in Parts VI and VIIof this Offering Document.
b) During the period the Register is closed, as mentioned in paragraph 9.4 of this Offering Document,the sale and redemption of Units will be suspended.
c) The Management Company can decline to issue units to any applicant, if it is of the opinion thatit will not be possible to invest substantial inflow of fund or to meet any regulatory requirement.
5.3 Offer and Redemption Prices
a) For the Offer Price during the Initial Period, please refer paragraph 3.7 of this Offering Document.
b) After the Initial Period, the Management Company shall in consultation with the Trustee announcethe Offer and Redemption Prices on a weekly basis on each Saturday, which is the last Businessday of the week, and such prices shall remain in effect for the following week. If Saturday is nota Business Day, the price will be announced on the preceding Business Day.
c) The Offer Price shall be equal to the sum of the Net Asset Value (NAV) as of the close of theBusiness Day immediately preceding the day of the announcement, and will carry Front-endLoad at the rate of two percent (2%) of NAV (subject to revisions by the Management Companyfrom time to time) and such amount as the Management Company may consider to be anappropriate provision of Duties and Charges and such sum to be adjusted upwards to the nearesttwenty five Paisa.
d) The Redemption Price shall be equal to the NAV as of the close of the Business Day immediatelypreceding the day of the announcement, less an amount as the Management Company mayconsider to be an appropriate provision of Duties and Charges and such sum to be adjusteddownwards to the nearest twenty five Paisa.
e) The Management Company shall publish the Offer and Redemption Prices in one or more leadingEnglish and/ or Urdu dailies having prime circulation in major cities of Pakistan at least on orbefore the first Subscription Day of the week.
f) If on any day during a week the variation of the NAV exceeds two percent (2%) of the NAVcalculated pursuant to sub-paragraphs 5.3(c) and (d) above, for the current Offer and RedemptionPrices, the Management Company shall suspend any issuance and redemption of Units andcalculate forthwith a new Offer Price and a new Redemption Price. The revised prices will bepublished on the following day in the manner described in sub-paragraph 5.3(e) above and willbe applicable for the remaining Business Days of the week.
g) In the event the amount recovered as provision for payment of Duties and Charges pursuantto sub-paragraphs 5.3(c) and (d) above is insufficient to pay in full such Duties and Charges,the Management Company shall be liable for the payment in full of the amount of such Dutiesand Charges in excess of the provisions. However, the Management Company will not be
UTP-ISLAMIC FUND
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responsible for imposition of any Duties and Charges with retrospective effect and such amountwill be recovered from Deposited Property.
h) In the event the amount recovered as provision for payment of Duties and Charges pursuantto sub-paragraphs 5.3(c) and (d) above exceeds the relevant amount of such Duties and Charges,the Trustee shall refund such excess amount to the relevant Holder with the next incomedistribution.
5.4 Suspension of Dealing, Queue System and Winding Up
Under the extraordinary circumstances mentioned in paragraph 3.9 of this Offering Document, theManagement Company may announce a change in the method of dealing in Units.
(i) Queue System – In the event redemption requests on any day exceed ten percent (10%) of theUnits in issue, the Management Company may invoke a queue system whereby requests forredemption shall be processed on a first come first served basis for upto ten percent of the Unitsin issue. The Management Company shall proceed to sell adequate assets of the Fund and/ orarrange Shariah based financing as it deems fit in the best interest of the Holders and shalldetermine the Redemption Price to be applied to the redemption requests based on such action.Where it is not practical to determine the chronological ranking of any requests in comparisonto others received on the same Business Day, such requests shall be processed on a proportionalbasis proportionate to the size of the requests. The redemption requests in excess of ten percent(10%) of the Units in issue will be carried over to the next Business Day. However, if the carriedover requests and the fresh requests received on the next Subscription Day still exceeds tenpercent (10%) of the Units in issue, these shall once again be treated on first-come-first-servedbasis and the process for generating liquidity and determining the Redemption Price shall berepeated and such procedure shall continue till such time the outstanding redemption requestscome down to a level below ten percent of the Units then in issue. If the Trustee has announceda book closure or suspended redemption subsequent to redemption application, the remainingredemption requests will be carried to the next Business Day, even if it is not a Subscription Day.Part redemption will be allowed, if necessary.
(ii) Winding up in view of major redemption – In the event the Management Company is of theview that the quantum of redemption requests that have built up shall result in the DepositedProperty being run down to an unmanageable level or is of the view that the sell-off of assetsis likely to result in a significant loss in the value for the Holders who are not redeeming, it mayannounce winding up of the Fund. In such an event, the queue system, if already invoked, shallcease to apply and all Holders shall be paid after selling the assets and determining the finalRedemption Price. Interim distributions of the proceeds may be made if the ManagementCompany finds it feasible.
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5.5 Expenses of UTP – Islamic Fund:
(a) The following expenses will be borne by the UTP – Islamic Fund:
1) Any remuneration of the Management Company;
2) Any remuneration of the Trustee;
3) Any remuneration/ fee payable to the Shariah Advisory Council;
4) Any Bank charges and borrowing/ financial cost;
5) Brokerage and transaction costs relating to investing/ disinvesting of the Deposited Property;
6) All expenses incurred by Trustee effecting the registration of all registerable property inTrustee’s name;
7) Legal and related costs as may be incurred in protecting or enhancing the interests of theScheme or the collective interests of the Holders;
8) Audit fees;
9) Legal counsel fee;
10) Loan documentation fee;
11) Listing fee payable to Stock Exchange;
12) Formation cost that will not exceed 1% of the amount of seed capital and will be amortizedover a period not exceeding five years;
13) Any payment to Charity (see paragraph 5.5 (e) below); and
14) Taxes, if any, applicable to the Trust.
(b) The Remuneration of the Trustee, the Management Company and the Shariah AdvisoryCouncil
Trustee
1) Monthly remuneration based on an annual tariff not exceeding 0.50% per annum upto Rsone billion and 0.1% for amounts exceeding Rs one billion of the average Net Assets ofUTP – Islamic Fund as of the last day of the calendar month starting from the payment infull of all Units subscribed by the Core Investors.
Management Company
1) Annual remuneration not exceeding 3% per annum of average Net Assets of UTP – Islamic
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Fund during the first five years starting from the date of payment in full of all Units subscribedby the Core Investors and 2% per annum thereafter;
2) An additional performance bonus as provided in the Rules.
Shariah Advisory Council
1) Remuneration to Member acting as Secretary: Monthly remuneration of Rupees TenThousand.
2) Remuneration of Other Members: A meeting fee of Rupees Five Thousand per meeting.
(c) The payment to Custodian, will be made by the Trustee and the payment to Transfer Agentwill be made by the Management Company and there will be no separate charge on theDeposited Property of UTP – Islamic Fund.
(d) The Management Company and Trustee shall bear all expenditures in respect of theirsecretarial and office space and professional management including all accounting andadministrative services provided in accordance with the provisions of the Trust Deed. Neitherthe Management Company nor the Trustee shall make any charge against the Holder noragainst the Deposited Property nor against the Distribution Account for their services northeir expenses, except such expenses as are expressly authorized under the provisionsof the Rules and the Trust Deed to be payable out of Deposited Property.
(e) The Unit Holders will have the option to authorize the Management Company to distributethe Haram income as Charity or to receive such income and distribute it themselves. TheManagement Company shall determine the amount of Haram income, if any, and subjectto verification by the Shariah Compliance Auditor and approval of the Shariah AdvisoryCouncil, pay such amount to Charity as authorized by the Unit Holders.
5.6 Dividends
At least 90% of the income, excluding realised capital gains received by UTP – Islamic Fund will bedistributed annually, as dividend and the balance of income will be retained for re-investment. TheManagement Company will also distribute a portion of realised capital gains. It may be noted that theincome from capital gains varies from year to year, depending upon the situation prevailing in the stockmarket. In a financial year when income from this source is high, the Management Compnay mayretain a portion of this income, which in its judgement is reasonable for distribution in a lean year. TheManagement Company will also ensure that distribution out of capital gains does not dilute the portfolio.The dilution can take place if an investment, which has been kept for a number of years, as growthinvestment is realised and the capital gains is distributed. In such cases the Management Companymay retain such capital gains and reinvest the proceeds, so that the portfolio does not get diluted. UTP-Islamic Fund shall always comply with regulatory and taxation requirements and the dividend policymay be amended accordingly.
All units shall have the same right with respect to dividend. The Unit Holders may request theManagement Company to re-invest the dividends due to them for purchase of additional Units (referto paragraph 10.5 below).
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5.7 Taxation
1) Taxation on the income of UTP – Islamic Fund
The following is a brief description of the Income Tax Ordinance 2001 applicable in respect ofUTP – Islamic Fund.
(a) Liability for Income Tax
Under the Income Tax Law in Pakistan, UTP – Islamic Fund is regarded as a public companyfor tax purposes. The income of UTP – Islamic Fund is taxable at the tax rate applicableto a public company, which is presently as under:
a) Dividend income - 5%.
b) Capital gains arising on sale of securities listed on any stock exchange in Pakistan - exempt from tax up to June 30, 2004.
c) Return from all other sources/ instruments is taxable at the rate of 35%, applicable to a public company.
(b) Liability for income tax, if 90% of income is paid as dividend
Notwithstanding the tax rates stated under (a) above, the income of UTP – Islamic Fundwill be exempted from tax, if not less than 90% of the income of the year, is distributedamongst the Unit Holders as dividend. The 90% of the income shall be calculated afterexcluding realized capital gains and capital appreciation. The UTP – Islamic Fund willcomply with the requirement of tax exemption and distribute at least 90% of the income,calculated after excluding realized capital gains, as dividend. Please also refer to paragraph5.6 of this Offering Document.
(c) Withholding tax
All income, namely, dividend, return from Shariah compliant term finance certificates, returnon Riba-free deposits with banks/ financial institutions, return from contracts, securities orinstruments of companies, organizations and establishments issued on the principles ofBai’ Mu’ajjal, Bai’ Salam, Istisna’a, Mudarabah, Murabahah and Musharakah of UTP –Islamic Fund will not be subjected to any withholding tax.
(d) Zakat
UTP – Islamic Fund is Saheb-e-nisab under Zakat and Ushr Ordinance, 1980. The balancein the credit of Savings Bank Account, or similar account with a Bank standing on 1st dayof Ramazan-ul-Mubarak will be subjec ted to deduction of 2 .5% Zakat.
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2) Taxation of Unit Holders and Liability to Zakat
The information set forth below is included for general information purposes only. In view of theindividual nature of tax consequences, each investor is advised to consult with his tax adviser withrespect to the specific tax consequences to him of investing in UTP – Islamic Fund.
(i) Income tax: Dividend paid to Unit Holders of UTP – Islamic Fund will be subject to income taxas under according to the present rates, which may be changed in future:
Income Tax Withholding Tax
(a) Public Company and 5% 5% Insurance Company
(b) Others 10% 10%
The portion of dividend paid out of capital gains on sale of listed securities will not be subjectto income tax and withholding tax.
(ii) Tax Credit: Unit Holders shall be entitled to a tax credit under section 61(1) and (2) of the IncomeTax Ordinance 2001 on purchase of new units. The amount on which tax credit will be allowedshall be lower of (a) amount invested; (b) ten percent of the total income of the Unit Holder and(c) Rupees One Hundred Thousand and will be calculated by applying the average rate of taxof the Unit Holder for the tax year. If the units so acquired are disposed within 12 months, theamount of tax payable for the tax year shall be increased by the amount of the credit allowed.It is stated that UTP -Islamic Fund will obtain listing on one of the stock exchanges in Pakistan.
(iii) Zakat: Units held by resident Pakistani Unit Holders shall be subject to Zakat at 2.5% of the ParValue of Units under Zakat and Ushr Ordinance, 1980, (XVII of 1980), except those exemptedunder the said Ordinance. Zakat will be deducted at source from the dividend amount or fromthe redemption payment, if Units are redeemed during the Zakat year before paymentof dividend.
PART VI – PROCEDURE FOR PURCHASE OF UNITS
6.1 Who Can Apply?
Applications for the issue of Units in UTP – Islamic Fund may be made by any investor or any relatedgroup of investors qualified or authorized to purchase the Units pursuant to the procedures describedin paragraph 6.2 below, including but not limited to:
a. Citizens of Pakistan: in respect of minors below 18 years of age, applications should be madeby their guardians.
b. Companies, corporate bodies, financial institutions, banks, partners of a firm and societiesincorporated in Pakistan so long as such investment is permitted under their respectivememorandum and articles of association and/ or bye-laws.
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c. Foreign nationals and companies incorporated outside Pakistan, subject to the regulations ofthe State Bank of Pakistan and the Ministry of Finance.
d . Provident Funds constituted by companies registered under the Companies Ordinance, 1984,subject to conditions as laid down in Employees Provident Fund (Investment in Listed Securities)Rules, 1996, as amended by S.R.O. 261(I)/2002 dated 10 May, 2002, to the extent of twentypercent of the Provident Fund, as amended from time to time.
(UTP – Islamic Fund will obtain listing on one of the stock exchanges in Pakistan)
e. Provident, Pension and Gratuity Funds constituted by organizations other than companies undersection 20(h) of the Trusts Act 1882, (11 of 1882).
f. Insurance companies under the Insurance Ordinance, 2000.
g. Non Profit Institutions, funds, trusts, societies or other organizations established in Pakistan forreligious or charitable and community service purposes under Section 213(1)(i) of Income TaxRules, 2002.
6.2
Application Procedure
1) Fully completed application form for purchase of Units, accompanied by the full amount ofpurchaser’s payment, as specified in paragraph 6.3 below and copies of the documents mentionedin sub-paragraphs (2), (3) and (4) should be delivered at any of the Authorized Branches of theDistribution Companies. Only Authorized Branches of Distribution Companies are authorizedto collect application and payment for issue of units, as laid down in paragraph 6.3 of thisOffering Document.
2) In case of individual applicants, a photocopy of the National Identity Card of the applicant or anyother form of identification acceptable to the Management Company.
3) In case of a body corporate or a registered society or a trust,
i. Copy of the memorandum and articles of association/ charter/ bye-laws or rules andregulations;
ii. Copy of the certificate of incorporation/ registration;
iii. Copy of the relevant resolution of the board of directors approving the investment;
iv. Copy of power of attorney and/ or relevant resolution of the board of directors delegatingany of its officer to invest the funds and/or to realize the investment; and
v. Copy of the national identity card of the officer to whom the authority has been delegated.
4) In case of existing Holders, if any of the documents which have been previously submitted, freshsubmission of same documents may not be required.
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5) If the application is incomplete or incorrect in any way the Distribution Company will advise theapplicant in writing to remove the discrepancy within a period of fifteen days, failing which theapplication will be rejected and the amount will be refunded without any interest or mark-up.
6) The Distribution Company will be entitled to verify the particulars given in the application form.In case of any incorrect information the application may be rejected.
7) The applicant will receive a note confirming the receipt of the application from the AuthorizedBranch of the relevant Distribution Company, where application for purchase of Units is submitted.
6.3 Payment
Payment for Units can be made by cheque or bank draft or pay order, made payable to the “TheTrustee – UTP – Islamic Fund ” and crossed “Account Payee only” and must be drawn on a Bank inthe same town as the Authorized Branch of the relevant Distribution Company to which the applicationform has been submitted is located. Payment for Units in cash will not be accepted. It is reiteratedthat only Authorized Branches of Distribution Companies are authorized to collect application andpayment for issue of units.
6.4 Joint Application
Joint application can be made by upto four related group of applicants. Such persons shall be deemedto hold Units on first Holder basis; however, each person must sign the application form and submita copy of their National Identity Card.
(1) The first named Holder shall receive all notices and correspondence with respect to the account,as well as proceeds of any redemption requests, or dividend or fractional payments. His receiptshall be considered as a valid discharge by the Trustee of its obligations.
(2) In the event of death of the first Holder, the person first in the order of survivor(s) as stated inthe application form, shall be the only person recognized by the Trustee to receive all notices
and correspondences with regard to the accounts, as well as proceeds of anyredemption requests or dividend or fractional payments. His receipt shall be considered as thevalid discharge by the Trustee of its obligations.
(3) Where Units are registered in the name of Joint Holders and subsequently additional Units arepurchased by the same Joint Holders but the application is made in different order, such additionalUnits will be registered under a different account.
6.5 Allotment (Issue) of Units
If an application duly delivered at or posted to the Authorized Branch of any of the Distribution Companyis accompanied by a cheque or bank draft or pay order, Units applied for will be allotted (issued) onthe date of receipt if it is a Subscription Day, or if not a Subscription Day, then on the next followingSubscription Day, provided that the cheque or bank draft or pay order accompanying the application,is realized. If the cheque or bank draft or pay order has been returned unpaid, the application will berejected.
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PART VII – PROCEDURE FOR REDEMPTION OF UNITS
7.1 Application Procedure
a) Requests for redemption can be made by completing the prescribed application form andendorsing the relevant Certificate, if issued, on the Certificate and submitting the same to anyAuthorized Branch of the relevant Distribution Company on any Subscription Day.
b) The Unit Holder will receive a note confirming the receipt of the application for redemption fromthe relevant Distribution Company.
7.2
Payment of Redemption Proceeds
a) Unless otherwise instructed, payment of the redemption proceeds will be made by a crossedcheque, in favour of the Unit Holder’s registered name, or in favour of the first-named joint Holderin the event of joint Holders, and will be sent at the Unit Holder’s or first-named joint Holder’saddress, as provided within six working days after the receipt of a properly documented requestfor redemption of Units, provided that the redemption is not suspended (Please refer to paragraph5.4) or the Register is closed (Please refer to paragraph 9.4).
b) If so instructed by the Unit Holder, payment of the redemption proceeds will be made by transferto the bank account number of the Unit Holder or first-named Joint Holder, in the event of JointHolders, within six Business days after the receipt of a properly documented request for redemptionof Units, provided that the redemption is not suspended.
c) In the event of Units that are pledged, are redeemed for any reason whatsoever, the proceedsshall be paid to the order of the lien holder’s designated bank account or posted to the registeredaddress mentioned in the pledge/ lien application form submitted.
7.3 Joint Holders
Unless the Joint Holders of Units have specified otherwise, requests for redemption of such Units shallbe signed by all the Joint Holders.
7.4 Partial Redemption
Partial redemption of Units covered by a single Certificate is not permitted. Holders may apply for asplitting of the Certificate before applying for redemption.
7.5 Redemption Requests in Excess of 10% of Units in Issue
Refer to Paragraph 5.4 of this Offering Document.
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PART VIII– TRANSFER OF UNITS
8.1 Application Procedure
a) A Unit Holder can transfer Units held by him by:
• Completing a Transfer Application Form to be signed by the transferor and transferee;• Paying applicable Duties and Charges; and
• Submitting to any of the Authorized Branches of the relevant Distribution Company, or theTransfer Agent, or the Management Company the Transfer Application Form and relevantCertificate(s), if issued.
b) Any person becoming entitled to hold the Units in consequence of the death, insolvency orwinding up of any sole Holder or the survivors of Joint Holders shall be registered as the Holderor Joint Holder as the case may be upon:
• Paying any applicable Duties and Charges; and
• Submitting to any of the Authorized Branches of the relevant Distribution Company, or theTransfer Agent, or the Management Company the duly completed Transfer ApplicationForm and relevant Certificate, if issued, with such evidence, which may prove his entitlementto the Units.
c) Application for transfer can be submitted on any Business Day during banking hours.
8.2 Partial Transfer
Partial transfer of Units covered by a single Certificate is not permitted. However Holders may applyfor a splitting of the Certificate before applying for transfer.
8.3 Verification of Transfer Application Form
At the request of the Unit Holder, the Transfer Agent will verify:
(1) The holding stated on the Transfer Application Form and
(2) Signature of the Holder.
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PART IX – SERVICE TO UNIT HOLDERS
9.1 Availability of Forms
All the forms mentioned and/ or included in this Offering Document will be available at all the AuthorizedBranches of all Distribution Companies.
9.2 Transfer of Account
a) Once a Unit Holder has purchased a Unit from an Authorized Branch of the Distribution Company,a copy of his records/ forms will be kept and maintained at that Authorized Branch. However,for the convenience of the Unit Holder, the Account may be transferred to another AuthorizedBranch or another Distribution Company on application by the Unit Holder for transfer of account.In case the relevant Distribution Company does not continue as the Distribution Company, theManagement Company and the Trustee will make arrangements for the Unit Holder’s accountto be transferred to another Distribution Company’s Authorized Branch at the nearest location.
b) Notwithstanding the provision in sub-paragraph 9.2(a), any Unit Holder may submit the applicationfor redemption or transfer or any application for change in Register directly to the ManagementCompany or Transfer Agent and the application will be processed.
9.3 Register of Unit Holders
a) A Register of Unit Holders shall be maintained by Technology Trade (Pvt.) Limited, in theircapacity as the Transfer Agent, at Room No. 901, 9th Floor, Business Plaza, Mumtaz HasanRoad, Karachi-74000.
b) Every Unit Holder will have a separate account folio.
c) The Holder will be entitled to inspect his record in the Register and request copies thereof onany Business Day from 10.00 A.M. to 1.00 P.M., except during the days when the Register isclosed in accordance with the provision of the Trust Deed, with the prior arrangement with theManagement Company or the Transfer Agent.
9.4 Closure of Register
The Management Company may close the Register by giving at least fourteen days notice to Holdersand for period not exceeding forty-five days in a calendar year. During the period the Register is closed,sale, redemption or transfer applications will not be received.
9.5 Information in the Register
The Register will contain the following information:
About Unit Holders
1) Name of Unit Holder/ joint Holders;2) Address of Unit Holder/ first named joint Holder;
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3) National Identity Card Number(s) or Passport Number(s) or Registration Number(s) of Unit Holder/ joint Holders;
4) Father’s/ Husband’s name of Unit Holder/ joint Holders;5) Occupation of Unit Holders/ joint Holders;6) Tax/ Zakat status of Holder; and7) Record of signature of Holder
About Units
1) Distinctive numbers;2) Certificate number(s), if applicable;3) Date of purchase/ redemption/ transfer and the reference number, if any;4) Number of Units held; and5) Record of verification of transfer forms/ redemption forms.
Instructions
1) Particulars of bank account if payment of dividend to be made to credit of a bank account, or ifpayment is to be made to the Holder’s registered address.
2) Instruction about reinvestment of dividend in Units;3) Instructions if redemption application is to be signed by first-named joint Holder only;4) Instruction about payment of Haram Income, if any, as charity;5) Information and instruction about pledge/ charge/ lien of Units; and6) Information and instruction about nominees in case of death of the Unit Holder.
The Unit Holders may notify in writing any change of name or address or any other particular to therelevant Authorized Branch of the Distribution Company, or to the Management Company, or to theTransfer Agent. The Distribution Company or the Management Company will forward such applicationto Transfer Agent, who on being satisfied therewith and on compliance with such formalities (includingin the case of a change of name the surrender of any Certificate previously issued to such Holder andthe payment of the fee) shall alter the Register or cause it to be altered accordingly and in the caseof a change of name shall issue a new Certificate if required to such Holder.
9.6 Account Statement
Units will be issued in registered, uncertificated form and will be confirmed to the investors by meansof an Account Statement.
The Transfer Agent will send directly to each Unit Holder a non-transferable Account Statement eachtime there is a transaction in the folio, i.e., Units are
(1) Issued/ subscribed;(2) Redeemed;(3) Transferred in favour of third person;(4) Transferred from third person in favor of Unit Holder;(5) Consolidated/ split; and(6) Additional Units are issued against re-investment of dividend.
An Account Statement will be posted within fifteen Business Days after each relevant transaction.
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9.7 Certificates
a) Unit Certificates will be issued only if requested by the Unit Holders.
b) Certificate will not be issued for fractional units.
c) Unit Holders can apply for the issue of Certificate by completing the prescribed application formand submitting it to the relevant Distribution Company together with a fee at the rate of twenty-five Rupees per Certificate of any denomination or any other amount as determined by theManagement Company from time to time.
d) Certificates shall only be issued for Units that have been fully paid, in such denomination asmay be required by the Holder.
e) Certificates where requested shall be issued as herein provided not later than fifteen BusinessDays after the date of such request. The Certificate may be sent to the Holder or his dulyauthorized nominee at his own risk by registered post or by delivery.
f) In the case of Units held jointly the Transfer Agent shall not issue more than one Certificate forthe Units held by such joint Holders and delivery of such Certificate to the Holder named firsttherein shall constitute sufficient delivery to all joint Holders. All payments required under thisDeed (i.e. redemption and dividend) will be made to first named joint Holder.
g) Certificates shall be issued in such form as may from time to time be agreed between theManagement Company and the Trustee. A Certificate shall be dated, shall bear the name andaddress of the Management Company and the Trustee, shall bear a distinctive and serial numberand shall specify the number of Units represented thereby and the name and address of theHolder as appearing in the Register.
h) Unit shall not be represented by more than one Certificate at any one time.
9.8 Replacement of Certificates
a) Subject to the provisions of the Trust Deed and in particular to the limitations of the denominationof Certificates as may be fixed by the Management Company and subject to any regulationsfrom time to time made by the Trustee with the approval of the Management Company everyHolder shall be entitled to exchange upon surrender of the existing Certificate any or all of hisCertificates for one or more Certificates of such denominations as the Holder may requirerepresenting the same aggregate number of Units.
b) In case any Certificate shall be lost, stolen, mutilated, defaced or destroyed, the Transfer Agent,with the approval of the Management Company may issue to the person entitled new Certificatein lieu thereof. No such new Certificate shall be issued unless the applicant shall previouslyhave:
(I) Returned the mutilated or defaced Certificate or furnished to the Distribution Company/Transfer Agent evidence satisfactory to the Management Company of the loss, theft ordestruction of the original Certificate;
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(II) Paid all expenses incurred in connection with the investigation of the facts and any noticeto be issued in newspaper inviting any claim (if any) against the lost Certificate to be notifiedto the Management Company, Trustee or Transfer Agent; and
(III) Furnished such indemnity as the Management Company and the Trustee may require.Neither the Management Company nor the Trustee nor the Distribution Company/ TransferAgent shall incur any liability for any action that they may take in good faith under theprovisions of the Trust Deed.
c ) Before the issuing of any Certificate under the provisions of the Deed the DistributionCompany/ Transfer Agent may require from the applicant for the Certificate the payment to itof a fee of twenty five Rupees for each Certificate, subject to revisions of fee from time to timeby the Management Company together with a sum sufficient (if any) in the opinion of theManagement Company to cover any Duties and Charges payable in connection with the issueof such Certificate.
9.9 Pledge/ Charge/ Lien of Units
Any Unit Holder may pledge/ charge/ lien all or any of his Units as security for debt to any third party.The Transfer Agent shall take a note of the pledge/ charge/ lien in his record, whether the Certificatehas been issued or not, provided sufficient evidence of pledge to the satisfaction of the Trustee and/or the Transfer Agent alongwith a joint request from the Unit Holder and the pledgee is submitted onthe standard application form, which is available at request. None of these parties, the Trustee, theManagement Company, Distribution Company nor the Transfer Agent, shall be liable for ensuring thevalidity of any such pledge/ charge/ lien. The disbursement of any loan against the constitution of suchpledge/ charge/ lien shall be at the entire discretion of the lender and neither the Trustee nor theManagement Company nor the Distribution Company and the Transfer Agent take any responsibilityin this matter.
Partial pledge/ lien of Units covered by a single Certificate is not permitted. However Holders mayapply for a splitt ing of the Certificate before applying for such partial pledge/ lien.
Save any legal bar or court order requiring otherwise, any dividends that are declared on the pledgedUnits shall be made to the order of the Unit Holder. However, any additional bonus Units that thepledged Units are entitled to automatically be marked under the lien of the lien holder and in the eventthe pledged Units are redeemed for any reason whatsoever, the proceeds shall be paid to the orderof the lien holder.
The lien on the pledged Units shall continue till such time it is released by the lien holder in writing.
9.10 Nomination
A single Unit Holder can nominate a successor to receive the Units upon his death by completing theprescribed section of the Application Form for Sale of Units and submitting the same to the AuthorizedBranch of the relevant Distribution Company. The nomination shall not be binding upon the Trusteeand Management Company, who may at their sole discretion request for Succession Certificate or anyother mandate from appropriate court or lawful authority or an indemnification, in the form they deemnecessary.
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9.11 Financial Reporting
The following reports will be sent to the Unit Holders:
a. Audited financial statements, together with the auditors report, the report by the ManagementCompany, the report by the Shariah Advisory Council, and the report by the Trustee within fourmonths of the close of each Accounting Period.
b. Un-audited financial statements, together with the report by the Management Company withintwo months of the close of the first half of each Accounting Period.
c. Un-audited financial statements, together with the report by the Management Company withina month of the close of the first and third quarter of each Accounting Period.
PART X – INCOME DISTRIBUTION
10.1 Accounting Period
The Accounting Period will commence from the date of registration of UTP – Islamic Fund for the firstperiod and from July 1, for all the following years to June 30.
10.2 Declaration of Dividend
The Management Company shall decide not later than forty-five days after the end of the AccountingPeriod whether to distribute profits if any, available for distribution in the form of dividends to the UnitHolders. The balance of the net income will be retained for re-investment in UTP – Islamic Fund. TheManagement Company may, pay the Unit Holders interim dividend, if it considers that the income forthe Accounting Period would justify such distribution.
10.3 Determination of Distributable Income
The amount available for distribution in respect of any Accounting Period shall be the sum of all receiptsof the nature of income, accrued profit on funds extended by Management Company under Islamicfinancing arrangements including but not limited to Musharakah, Murabahah and Istisna’a and netrealized appreciation, which is the value of fixed assets and investments, from which shall be deducted(1) the expenses, as stated in paragraph 5.5 of this Offering Document and (2) any taxes on UTP –Islamic Fund.
The Income qualifying for distribution shall be adjusted as under:
• By additions of a sum representing amounts included in the Price of Units for income accruedprior to the date of issue;
• By deduction of a sum representing all participation in income distributed upon redemption of Units;
• By deduction of a sum representing diminution in the value of Deposited Property; and
• By deduction of a sum representing income derived from activities (if any) not in accordance with Shariah.
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10.4 Charity
UTP-Islamic Fund will invest in securities and instruments which are approved by Shariah AdvisoryCouncil, as Shariah - Compliant investment. Never the less, there is a possibility that, UTP-IslamicFund may receive on its investment, income that is Haram, e.g. income which is derived from interest.Such income will be segregated and paid to approved charities in consultation with the Shariah AdvisoryCouncil, where such authority is received from unit holders.Where authority is not recieved such incomewill be distributed to unit holders, who may dispose it off in a manner, they may deem neccessary.
10.5 Reinvestment of Dividend
a) Unit Holders may instruct the Distribution Company or the Management Company or the TransferAgent in writing to re-invest the future dividends to which he will be entitled on the total numberof Units held by him, in the acquisition of Units with No Load at the Net Asset Value. The Unitspurchased under one account folio cannot be split for receiving part cash dividend and partreinvestment of dividend. The applicants are advised to maintain two account folios under thesecircumstances. Such request will remain effective until it is countermanded in writing.
b) The Offer Price for the Units to be issued under paragraph 10.5(a) above will be the NAV onJune 30, as certified by the Auditors, after appropriation of the income of that year.
c) Fractions of a Unit will be issued up to two decimal places of a whole Unit, and any amountremaining (if any) may be distributed to the Unit Holder. Certificates will not be issued for fractionsof Units.
10.6 Payment of Dividend
All payments for dividend shall be made by cheque by the Trustee in favour of the Unit Holder or tothe first named joint Holder and sent through the registered post at their registered address. Everycheque shall be made payable to the order of the person to whom it is delivered.
10.7 Payment through Bank of Dividend/ Redemption Proceeds
Where an instruction has been received in such form as the Management Company shall considersufficient, payment of dividend of the total number of Units held by the Unit Holder can be arrangedto the banker. The Units purchased under one account folio cannot be split for part only payment ofdividend through bank. The applicants are advised to maintain two account folios under thesecircumstances. For payment of redemption proceeds through bank account, instruction to this effectshall be given at the time of redemption application by indicating in the Application for RedemptionForm.
10.8 Dispatch of Dividend Warrants
Dividend warrants shall be dispatched within 30 days after the declaration of dividend.
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PART XI – OBJECTIVES AND INVESTMENT POLICY
11.1 Investment Objectives
The main objective of the UTP – Islamic Fund is to provide an avenue of investments to those whowant to invest their savings in such schemes which are based on profit/ loss sharing basis and areshariah compliant. In addition the aim is to provide to the investors an optimum rate of return, reasonableconcern for safety of capital and to provide to the investors liquidity to join or leave the fund at theirconvenience. The main focus of the UTP – Islamic Fund is to provide an outlet to investors who want‘Riba-free’ returns i.e. based on profit/ loss sharing.
Consistent with this policy, UTP – Islamic Fund will invest in a diversified portfolio of securities andinstruments in accordance with the requirement of Shariah with a view to optimise returns balancedwith risk. The Shariah Advisory Council will advise the Management Company on Shariah compliance.
11.2 Investment Policy
(I) UTP – Islamic Fund will follow an investment strategy that makes it a ‘balanced’ fund. A balancedfund will carry a reasonable mix of equity and non-equity securities, and will seek both growthand income, remaining within the guidelines of Shariah at all times.
(a) UTP – Islamic Fund will invest primarily in Shares, Participation Term Certificates, MudarabahCertificates, Musharakah, Murabahah, Term Finance Certificates, Preference Shares,Convertible Preference Shares, and other asset backed or mortgaged based securities;
(b) UTP – Islamic Fund will also invest in contracts, securities or instruments of companies,organizations and establishments issued on the principles of Bai’ Mu’ajjal, Bai’ Salam,Istisna’a, Mudarabah, Murabahah and Musharakah;
(c) UTP – Islamic Fund may also hold assets in form of Riba-free cash deposits with Banksor financial institutions with the object of maintaining sufficient liquidity to meet the redemptionrequirements and to take advantage of suitable investment opportunities as and when theyarise;
(d) UTP – Islamic Fund may also invest in such other instruments that may be allowed by theSECP and confirmed as Shariah-compliant by the Shariah Advisory Council from time totime;
(e) The weightings of the investment mix of the portfolio shall be managed in a manner thatreduces the risk of loss in market value of the investment as a result of prevailing marketsituation, remaining within the guidelines of Shariah at all times.
(f) The weightings of the investment mix of the portfolio shall depend on the availability ofShariah based investment securities. In the view of this, initially the investment will mainlybe in listed securities.
(II) Some of the modes of investment are discussed below:
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(A) EQUITIES
• Investment in equities will be subject to the following Shariah Compliance/ Investment Criteria:
1. SHARIAH COMPLIANCE
(i) Basic Shariah Compatibility Criterion: – Investments in equity will not be made incompanies carrying the business of interest based banking, financial institutions, leasing,conventional insurance, entertainment (including hotels, casinos, cinemas, etc) alcohol,tobacco, weapons, pork products or other Haram activities.
(ii) Substantial Tangible Assets Criterion: – The tangible assets should be at least 33% tothe total assets.
(iii) Minimal Debt/ Equity Criterion: – The interest bearing debt will not exceed a benchmarkratio of 33% to the total assets.
(iv) Haram Income Ceiling: – The interest and other non Shariah Compliant income will beless than a benchmark ratio of 5% to operating income.
The shariah Advisory Council in its discretion can relax the benchmark ratios for (ii), (iii)and (iv) above.
2. INVESTMENT CRITERIA
UTP – Islamic Fund will invest in shares of companies, which are either:
(i) Consistently dividend paying;(ii) Having growth prospects; and/ or(iii) Are actively traded.
On the basis of the Shariah Compliance/ Investment Criteria laid down above, the ManagementCompany has prepared a list of equity investments listed on the Stock Exchanges which qualifyfor investment by the UTP-Islamic Fund. The Shariah Advisory Council has approved the listsubject to a yearly review.
(B) ISLAMIC FINANCING
Islamic Financing is an asset backed financing. The conventional/ capitalist concept of financing isthat the banks and financial institutions deal in money and monetary papers only and are forbiddenin most countries from trading in goods and making inventories. Islam, on the other hand, does notrecognize money as a subject matter of trade, except in special cases, as money has no intrinsic valueand is only a medium of exchange. Profits are generated when something having intrinsic utility is soldfor money or when different currencies are exchanged, one for another. The profit earned throughdealing in money (of same currency) or the papers representing them is interest, and hence prohibitedin Islam. Therefore, unlike conventional financial institutions, financing in Islam is always based onassets, which creates real assets and inventories.
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Following are some of the instruments of financing, for UTP – Islamic Fund.
(i) MUDARABAH
Mudarabah is a special kind of partnership, where one partner gives money to another forinvesting it in a commercial enterprise. The investment comes from the first partner, while themanagement and the work is an exclusive responsibility of the other. The ratio in which the profitsare distributed is fixed and known in advance to both the parties. They can share the profits inequal or different proportions of the earnings. The loss, if any, incurred in the normal processof business and not due to the neglect or misconduct on the part of the capital user is borne bythe capital provider. There are listed Mudarabahs and UTP – Islamic Fund will invest in suchMudarabahs, which meet its investment criteria.
(ii) MUSHARAKAH
Musharakah means a joint enterprise in which all the partners share the profit or loss of a jointventure and can participate in the management of the business and work for it. The ratio in whichthe partners share the profit of the business is fixed and pre determined and made known inadvance to all those concerned. The profit sharing ratio is left to be mutually agreed upon andmay be different from the ratio in which the concerned parties have invested in the total capitalof the project. In the case of loss each partner shall suffer the loss exactly according to the ratioof his investment. UTP – Islamic Fund will identify such transactions for investment which areof short period of six months to one year and where the partner has good reputation and isreliable. UTP – Islamic Fund will participate in capital only and not in management.
(iii) BAI’ SALAM/ ISTISNA’A
Bai’ Salam means advance payment of forward buying. It is a sale whereby the seller undertakesto supply some specific goods to the buyer at a future date in exchange of an advanced pricefully paid at spot.
Istisna’a is basically a contractual agreement for processed goods and commodities, allowingcash payment in advance and future delivery, or a future payment and future delivery.
Bai’ Salam trading opens the way to a number of new opportunities, including some forms offutures contract trading. UTP – Islamic Fund will buy shares, of the companies that meet theinvestment cr iter ia, in the ready market and sell them in the futures market.
(iv) BAI’ MU’AJJAL
Bai’ Mu’ajjal literally means sale on deferred payment basis. Delivery of goods, inputs orimplements is made immediately and the price agreed is paid by the purchaser at a given datein the future. The price includes the cost, plus a reasonable margin of profit to cover theadministrative cost. UTP – Islamic Fund will provide finances to parties, who have good reputations,in need of finance to purchase certain goods. Goods will be bought on behalf of that party andwill be handed over when the payment is made by adding a profit.
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(v) MURABAHAH
In Murabahah, a seller expressly tells the purchaser how much cost he has incurred and howmuch profit he is going to charge in addition to the cost. This is a cost plus contract. By thistechnique a party needing finance to purchase certain goods gets the necessary finance on adeferred payment basis. The finance provider does the purchasing of the required goods andsells them on the basis of a fixed mark-up profit, agreeing to defer the receipt of the value of thegoods even though the goods can be delivered immediately.
11.3 Investment Restrictions
1) UTP – Islamic Fund shall be subject to exposure limits as are provided in the Rules and by theShariah Advisory Council;
2) UTP – Islamic Fund will not invest in securities or investment vehicles, which are not in compliancewith the tenets of Islamic Shariah. In this regard, UTP – Islamic Fund shall not invest in:
i. Securities which do not fall into the criteria of being Shariah Compliant, as directed by theShariah Advisory Council;
ii. Securities which provide a Riba based return;
iii. Shares of companies that are involved in business termed Haram according to Shariah.
3) UTP – Islamic Fund shall invest not less than fifty percent of its Net Assets in listed securitiesor securities in the process of being listed.
4) UTP – Islamic Fund shall not invest in any one company more than fifteen percent (15%) of thetotal Net Asset of UTP – Islamic Fund or fifteen percent (15%) of the issued capital of suchcompany.
5) UTP – Islamic Fund shall not invest more than thirty (30%) percent of its Net Asset in any onesector.
6) UTP – Islamic Fund shall not invest in any security of a company nor shall any amount be loanedto a company if any director or officer of the Management Company or any of their ConnectedPerson owns more than five percent (5%) of the total nominal amount of the securities issuedof such company, or collectively the directors and officers of the Management Company or anyof their Connected Person owns more than ten percent (10%) of those securities.
7) UTP – Islamic Fund will not at any time:
(i) Purchase or sell:
• Bearer Securities;
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• Securities on margins;
• Securities which result in assumption of unlimited or undetermined liability (actual orcontingent);
• Real estate or interest in real estate save and except that the Management Companymay invest in securities secured by real estate or interest therein or equity securitiesissued by companies that invest in real estate or interest herein;
• Securities that are not Shariah compliant;
• Anything which is prohibited or Haram; and
• Anything other than Authorized Investments as defined.
(ii) Make short sales of any security or maintain a short position.
In respect of 4) and 5) above, SECP has allowed the relaxation in the exposure limit underRule 13(4) of the Asset Management Companies Rules, 1995 vide its letter No. SC/MF-JD(R)/463/2002 dated December 20, 2002.
11.4 Exception to Investment Restrictions
If and so long as the value of the holding in a particular company or sector shall have reached the limitas per paragraph 11.3 above, the Management Company shall not purchase any further investmentin such company or sector. However this restriction on purchase shall not apply to any offer of right offering.
11.5 Transactions with Connected Persons
a) UTP – Islamic Fund shall not invest in any security of a company if any director or officer of theManagement Company individually owns more than five per cent of the total nominal amountof the securities issued or collectively the directors and officers of the Management Companyin their individual capacities own more than ten per cent of those securities.
b) UTP – Islamic Fund shall not purchase from or sell any security to the Management Companyor the Trustee or to any director, officer or employee of the Management Company or Trusteeor to any person who beneficially owns ten per cent or more of the equity of the ManagementCompany or the Trustee.
c) For the purpose of sub-paragraphs (a) and (b) above the term director, officer and employeeshall include their relatives including the spouse and dependant children.
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PART XII – BORROWING POLICY
12.1 Limit
At the request of the Management Company, the Trustee may make arrangements with Islamic Banksor financial institutions for arranging finance, which shall not exceed in the aggregate twenty-five percent of the Net Assets of UTP – Islamic Fund and will be utilized for temporary and defensive purposeonly to meet redemption of Units.
12.2 Exception
The Trustee shall not be obliged to reduce the financing if as result of depreciation in the market valueof investment or redemption of Units the Net Asset subsequent to borrowing has been reduced andconsequently the limit set in paragraph 12.1 above is exceeded.
12.3 Pledge
The Trustee may with the approval of the Management Company mortgage, charge or pledge in anymanner all or part of the Deposited Property, as is required to secure the financings as describedabove.
12.4 Guarantees
Neither the Trustee nor the Management Company shall be required to issue any guarantees orprovide security over their own assets for securing such financings from banks and financial institutions.The Trustee or the Management Company shall not in any manner be liable in their personal capacitiesfor repayment of such loans or advances.
12.5 Liability of Trustee and Management Company
The Trustee or the Management Company shall not incur any liability by reason of any loss to theTrust or any loss that a Holder may suffer by reason of any depletion in the Net Asset Value that mayresult from any financing arrangement made hereunder.
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Abbott Laboratories Pakistan Ltd.- PS Account 5,000,000
Abbott Laboratories Pakistan Ltd.- Staff Pension Fund 5,000,000
Century Paper & Board Mills Ltd. - Employees Gratiuty Fund 2,500,000
EFU General Insurance Ltd. 10,000,000
EFU Life Assurance Ltd. 10,000,000
Employees Provident Fund of Central Depositary Company of Pakistan Ltd. 500,000
Engro Chemical Pakistan Ltd. MPT Employees Pension Fund 5,000,000
Engro Chemical Pakistan Ltd. - Provident Fund 5,000,000
International General Insurance Company of Pakistan Ltd. 1,000,000
Jahangir Siddiqui Investment Bank Ltd. - Provident Fund Account 150,000
Mr. Illyas Katchi (Proprietor of Katchi Line) 200,000
ORIX Investment Bank Pakistan Ltd. 5,000,000
ORIX Leasing Pakistan Ltd. - Employees Provident Fund 2,500,000
Pakistan Kuwait Investment Company (Pvt.) Ltd. 6,050,000
Pakistan PTA Management - Staff Gratuity Fund 1,000,000
Pakistan PTA Management - Staff Pension Fund 1,000,000
Pir Mohammad A. Kaliya 100,000
Total 60,000,000
PART XIII – FINANCIAL INFORMATION
13.1 Auditors Certificate on Core Investors’ Investment in the Units of UTP – Islamic Fund.
December 26, 2002 Ref: Br.-0952/ U-311
The DirectorsABAMCO Limited,1306-1307 Chapal Plaza,Hasrat Mohani Road,Karachi–74000.
Dear Sir,
In accordance with your request, we confirm that on the basis of the bank certificate and otherinformation provided by Muslim Commercial Bank Ltd., PNSC Branch, Karachi that a sum ofRs. 60 million was deposited in the account of “The Trustee.UTP – Islamic Fund” up toDecember 26, 2002 in respect of subscription of Units by the following Core Investors:
Name of Core Investors Rupees
Yours truly,
Ford Rhodes Sidat Hyder & Co.Chartered Accountants
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13.2 Auditors Certificate on Net Asset Value of Units in UTP – Islamic Fund
December 26, 2002 Ref: Br.-0961/ U311
The DirectorsABAMCO Limited,1306-1307 Chapal Plaza,Hasrat Mohani Road,Karachi–74000.
Dear Sir,
In accordance with your request, we confirm that on the basis of the books and records of the UTP– Islamic Fund as on December 26, 2002, the Net Assets of UTP – Islamic Fund amounted toRs. 60,000,000. The Net Asset Value of each Unit amounted to Rs. 500, which was arrived at bydividing the Net Asset by the number of Units in circulation (120,000) as at that date.
We draw attention to paragraph 13.3 of the Offering Document in which the Management Companyhas estimated the Formation Costs of UTP- Islamic Fund prior to and during the Initial Period inwhich Units will be offered at the Initial Price in accordance with the terms of the Offering Document.No formation costs borne by the Management Company has been charged to UTP- Islamic Fundupto December 26, 2002. Hence, the Net Assets as on December 26, 2002 have been determinedwithout writing off formation costs incurred upto December 26, 2002.
Yours faithfully,
Ford Rhodes Sidat Hyder & Co.Chartered Accountant
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13.3 Formation Cost
All preliminary and floatation expenses of the Trust including expenses incurred in connection withthe authorization of the Scheme, execution and registration of the Constitutive Document, issue,circulation and publication of the Offering Document and all expenses incurred during the InitialPeriod, shall be borne by UTP – Islamic Fund and amortized over a period of not more than fiveyears. The cost will not exceed at Rs. 600,000.
PART XIV – TERMINATION OF UTP – ISLAMIC FUND
14.1 By the Management Company
UTP – Islamic Fund may be terminated by the Management Company by giving appropriate noticein writing to the Holders on the grounds given in clause 5.4 (ii) of this Offering Document.
14.2 By the Securities and Exchange Commission of Pakistan (SECP)
If the SECP considers that further continuation of the authorization of UTP – Islamic Fund will notbe in the interest of Unit Holders, it will give a three months notice to the Unit Holders about itsintention not to maintain such authorization, provided that no notice shall be served without offeringan opportunity of hearing to the Management Company.
14.3 Winding up
In case of the termination of UTP – Islamic Fund, the Management Company shall be required towind-up UTP – Islamic Fund and refund the proceeds to the Unit Holders in such a manner andwithin such time as may be specified by the SECP.
PART XV – ARBITRATION
In the event of any disputes arising out of the Trust Deed or Offering Document between theManagement Company on the one part and the Trustee on the other part, including as to therespective rights and obligations of the Parties hereto, as well as those relating to the interpretationof the terms and the conditions of the Trust Deed, Offering Document and/ or the SupplementaryOffering Documents, relating to the Unit Trust, the same shall be referred to arbitration by twoarbitrators, one to be appointed by the Management Company and the other to be appointed bythe Trustee. In the event of lack of consensus between the two arbitrators, the matter shall bereferred to an umpire, to be selected by the two arbitrators before the commencement of thereference. The unanimous decision of both the arbitrators, or the decision of the umpire, as the casemay be, shall be final and binding upon both the parties. The arbitrators and the umpires shall beselected from amongst, senior partners of renowned firms of chartered accountants, or seniorpartners or renowned law firms, or senior bankers or senior business men or senior executives. Thevenue of the arbitration shall be Karachi. The arbitration shall be conducted in accordance with theArbitration Act, 1940.
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PART XVI – AUTHORIZED BRANCHES OF THE DISTRIBUTION COMPANIES
1. ABAMCO Limited
Ms. Nayab Fakhir Qazi (Head of Marketing & Sales)1306-1307, Chapal PlazaHasrat Mohani Road, Karachi- 74000Telephone # (92-21) 2441311-14Fax # (92-21) 2425652E-mail : [email protected]
Mr. Irfan Ali Lotia (Sales Officer)C/o EFU General Insurance Company Limited (Tariq Road Branch)964-964, Central Commercial Area, Allama Road, P.E.C.H.S., Karachi-75400Telephone # (92-21) 4522730, 4547478 Mobile: (0300) 9254412Fax # (92-21) 45445584
Mr. Muhammad Wasim Butt (Marketing Manager North)C/o EFU General Insurance Company Limited (Egerton Road Branch)7/1, Venus Plaza, 7/E, Egerton Road, LahoreTelephone # (92-42) 6301514 Mobile: (0303) 7595847Fax # (92-42) 6302705E-mail: [email protected]
2. Jahangir Siddiqui & Co. Limited
14th Floor Chapal PlazaHasrat Mohani Road, Karachi- 74000Telephone # (92-21) 2431181-88Fax # (21-21) 2431178-2431151
68-69, 1st Floor, Stock Exchange BuildingStock Exchange Road, Karachi- 74000Telephone # (92-21) 2427460-61, 2427463Fax # (92-21) 2418106
3. Jahangir Siddiqui Investment Bank Limited
1301-1303, Chapal PlazaHasrat Mohani Road, Karachi – 74000Telephone # (92-21) 2429445-50Fax # (92-21) 2429448
4. Muslim Commercial Bank Limited
Shaheen Complex BranchDr. Ziauddin Ahmed Road, Karachi-74000Telephone # : (92-21) 2637192, 2639573, 2639574Fax # (92-21) 2634278, 2631398
Finance & Trade Centre BranchGround Floor, Block DShahra-e-Faisal, Karachi-75350Telephone # : (92-21) 5675110Fax # : (92-21) 5675119
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DHA Branch18-C, Commercial Area “A”, Defence Housing Authority, Karachi-75500Telephone # : (92-21) 5899009, 5890010Fax # : (92-21) 5380430
The Mall Branch72, Shahrah-e-Quaid-e-Azam, LahoreTelephone # : (92-42) 7243890, 7354041, 7227707Fax # : (92-42) 7355051
Liberty Market Branch46-E/ III Comercial Zone, Chenab Centre, Gulberg III, LahoreTelephone # : (92-42) 5756829, 5759730, 5761026Fax # : (92-42) 5711857
Circular Road BranchCircular Road, FaisalabadTelephone # : (92-41) 649100, 635228, 636706Fax # : (92-41) 637110
The Mall BranchThe Mall, RawalpindiTelephone # : (92-51) 5517288, 5568862Fax # : (92-51) 5583180
Super Market BranchSuper Market, School Road, F-6, IslamabadTelephone # : (92-51) 2827011, 2820722Fax # : (92-51) 2824227
Peshawar Cantt. BranchNear Greens Hotel, Saddar Road, Peshawar Cantt.Telephone # : (92-91) 279769, 274394, 274234Fax # : (92-91) 279427
Jinnah Road Branch,1-25/17, Jinnah Road, QuettaTelephone # : (92-81) 835379, 837390Fax # : (92-81) 836380
5. PICIC Commercial Bank Limited
Karachi Main Branch,Ground Floor, Schon CentreI.I. Chundrigar Road, Karachi-74200Tel: (92-21) 2637161-72Fax: (92-21) 2636909
Lahore Main Branch20-C, Kashmir/ Egerton Road, LahoreTel: (92-42) 6315518Fax: (92-42) 312551
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6. The Bank of Khyber
Peshawar:Main Branch, 24-The Mall, Peshawar Cantt.Tel: (92-91) 279791, 271758, 285275,287522Fax: (92-91) 279791Contact person : Mr. Ashfaq Nadeem (Manager)
Abbottabad:Jinnah Road, Abbottabad.Tel: (92-992) 9310157 Fax: (92-992) 9310158Contact person : Khawar Wasim Khan
Nowshera:Saad Plaza, Nowshera Cantt.Tel: (92-923) 610972 Fax: (92-923) 640053Contact person : Mir Haider Khan (Manager)
Dera Ismail Khan:Circular Road, D.I. KhanTel/ Fax: (92-961) 9280305, 9280098Contact person: Ms. Farah Karamat Wazir (Officer)
Mardan:Cantonment Plaza, Shahrah-e-Qazi Bashir, Mardan.Tel: (92-931) 649000,65898Contact person: Mr. Muhammad Amin (Officer)
7. Kontinental Consultants Inc.
409, 4th Floor, Progressive Plaza, Beaumont Road, Civil Lines,Behind PIDC House, Karachi-75530Tel: (92-21) 5689032, 5680773 Fax: (92-21) 5686324
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Application Forms
61
a) Name:
Name of Father/ Husband:
NIC No: Occupation:
Address:
Telephone:
E-mail:
* Includes Rs. for issue of Unit Certificate(s) (See note 4 in part B)
2 . I am/ We are unit holder(s). My/ Our Folio No. is:Please register the units applied for in this folio/ separate folio.
3. I/ We declare that I am/ we are not minor(s).
4. I/ We will not claim repatriation from Pakistan of dividend and sale proceeds ofthis/ these unit(s) except as permissible under the rules of State Bank of Pakistanor Ministry of Finance, Government of Pakistan.
5. I/ We authorise the Management Company to pay to authorized charities any Haramincome accruing to the Fund. (Please see note 9 of guidelines)
Yours faithfully,
Application Form for Sale of Units
Sale Number(To be filled in by the Company)
DateThe Trustee,UTP-Islamic Fund,9th Floor,Shaikh Sultan Trust Building No. 1,Beaumont Road,Karachi-75530
See guidelines on reverse
Part A
Authorized Branch of Distribution Company
Dear Sir,
1. I/ We
apply for the purchase of units of UTP-Islamic Fund for which payment is enclosed,subject to the provisions of the Trust Deed and the Offering Document of UTP-Islamic Fund.
Numberof Units
Offer Price Amount* Mode of Payment
Cheque/ Draft No:
Dated:
Drawn on:(Name and Branch of the Bank)
(See paragraph 5 of guidelines)
Applicant/ First Named Joint Applicant
Joint Applicant(s)
b)Name:
Name of Father/ Husband:
NIC No: Occupation:
E-mail:
c)Name:
Name of Father/ Husband:
NIC No: Occupation:
E-mail:
d) Name:
Name of Father/ Husband:
NIC No: Occupation:
E-mail:
Note: Please attach photocopies of National Identity Card(s)
2. State Muslim/ Non Muslim. In case of Muslim, if not liable to Zakat provide affidavit
3. List of documents attached (please mark “Y” if documents attached and “X” if not attached)and also state whether original or photocopy.
q National Identity Card(s).
q Memorandum and Articles of Association/ Bye Laws/ Trust Deed.
q Power of Attorney or other documents authorizing the officer signing the Application Form.
q Board Resolution authorizing investment.
q Zakat Affidavit.
q Any other documents (Give detail).
Note: Copies of documents to be attested.
APPLICATION FORM
Application
Cheque/ Draft
Receipt Sale Number DateReceived from
Application Form for the sale of units of UTP-Islamic Fundwith cheque/ draft number dated
for Rs. drawn on anddocuments overleaf.
To be filled in by Distribution Company
Part B Particulars of Applicant
Authorized Branch(Rubber Stamp)
(Authorized Signatory)Note: Names and signatures of attorneys in case of companies / trusts, etc.
4. Request for the issue of Unit Certificate(s):
Unit(s) will be issued in registered, uncertificated form and will be confirmed by meansof an Account Statement issued by the Transfer Agent. Unit Certificate(s) (availablein the denominations of 1,5,10,50 and 100 or jumbo certificate for all the units) willbe issued only if requested and on payment of Rs. 25/- per certificate. Payment forcertificate(s) may be combined with the payment for unit(s). Unless indicated by theapplicant minimum number of certificates will be issued.
(Circle the denomination required)
Name(s) and Specimen Signature(s)
Name Signature
Names Signatures
Applicant/ First Named Applicant
Joint Applicants
b)
c)
d)
a)
U T P-ISLAMIC FUND
NoYes
1. Payment of Dividend:Please sign (Applicant/ First Named Applicant) at the appropriate place, to indicatehow you want to receive the future dividend due to you. Unless indicated, dividendwarrant will be sent at the registered address.
To be reinvested for purchase of units (Sign) or
To be paid to the credit of Bank Account Number with
(Bank/ Branch) (Sign) or
To be sent at the registered address (Sign)
(See paragraph 5 of guidelines)Guidelines for Completing the Application Form
for Sale of Units
In case of any assistance, please contact the Management Company.Head Office: Suite # 1306-1307, Chapal Plaza, 13th Floor, Hasrat Mohani Road,
Karachi. Tel: (92-21) 2441311-14 Fax: (92-21) 2425652Lahore Office: 7/1, Venus Plaza, 7/E, Egerton Road, Lahore.
Tel: (92-42) 6301514, Mobile: (0303) 7595847, Fax: (92-42) 6302705or Distribution Companies
1) Please complete the Application Form in block letters with a ball pen.
2) In case of partnership firm or a trust, application shall be made in the nameof partners or trustees.
3) The units issued carry a Front-end Load, which the applicants pay at the timeof purchase. No sales load is charged on the units purchased through reinvestment.
4) Payment for the units and certificates shall be made by cheque or bank draftin the name of "The Trustee – UTP - Islamic Fund" and crossed "PayeesAccount Only". Outstation cheque or cash will not be accepted. If the chequeis returned unpaid the application will be rejected.
5) If the applicant is already a unit holder and has indicated the existing FolioNumber in Part 'A', Part 'B' or Part 'C' may not be completed. If however thereare any changes, the relevant portions may only be completed and the remainingportions deleted. If the applicant wants that the new instructions should onlyapply to the unit(s) being purchased and not to the previous holdings, a separatefolio may be asked for by so indicating in Part 'A' and then complete Part 'C'.
6) Copies of the following documents are required to be attached with the applicationfor purchase of units. The Distribution Company will be entitled to verify thesignatures on Application Form and copy of the documents attached with originalor request for attested copies.
a) Individuals (new applicants only): National Identity Card.
b) For companies/ trusts/ statutory bodies (new applicants only or if there areany amendments in these documents):
• Memorandum and Articles of Association/ Bye Laws/ Trust Deed.
• Power of Attorney or other documents authorizing the officer signing theApplication Form.
• National Identity Card(s) of the officer(s).
• Board Resolution authorizing investment. (On each application for purchaseof units).
7) Unit Certificates (if required) and Account Statement will be dispatched at theregistered address within 15 business days of the submission of properly documentedApplication Form.
8) For change in Unit Holders' Register, such as address, unit holders may pleasewrite to the Management Company or Transfer Agent.
9) UTP-Islamic Fund will invest in securities and instruments which are approvedby Shariah Advisory Council, as Shariah - Compliant investment. Never the less, there is a possibility that, UTP-Islamic Fund may receive on its investment, incomethat is Haram, e.g. income which is derived from interest. Such income will besegregated and paid to approved charities in consultation with the Shariah AdvisoryCouncil, where such authority is received from unit holders.Where authority isnot recieved such income will be distributed to unit holders, who may dispose itoff in a manner, they may deem neccessary.
List of documents attached (please mark “Y” if documents attached and “X” if notattached and also state whether original or photocopy)q National Identity Card(s).q Memorandum and Articles of Association/ Bye Laws/ Trust Deed.q Power of Attorney or other documents authorizing the officer
signing the Application Form.q Board Resolution authorizing investment.q Zakat Affidavit.q Any other documents (Give detail).
Part C Instructions by Applicant
Authorized Branch(Rubber Stamp)
(Authorized Signatory)
Signature of Holder
a) Name:
Relation with Holder:
Name of Father/ Husband:
NIC No: Share:
Address:
Particulars of Nominee(s)
b) Name:
Relation with Holder:
Name of Father/ Husband:
NIC No: Share:
Address:
3. Information about nominee(s) (not applicable in case of Joint Holding)I nominate the following_________ (state number) person(s) to receive the unitsheld in my name according to their share in the event of my death. I agree and acceptthat nomination(s), shall not be binding upon the Trustee, the Management Companyor the Distribution Company, who may at their sole discretion request for SuccessionCertificate or any other mandate from an appropriate Court or lawful Authority oran indemnification before releasing the proceeds of my units to my nominee(s). Ifurther agree that the Trustee, the Distribution Company and/ or the ManagementCompany shall not be liable for any issues/ disputes amongst my legal heirs and/ orthe nominees arising out of this nomination.
The entitlement to a fraction of a unit may be consolidated and redeemed. Theproceeds may be paid to the nominees.
2. Instruction regarding signing of Redemption/ Transfer Application Form incase of Joint Holding (Tick the appropriate option. In case of second optionall the Joint Holders are required to sign in the box)
Option I Redemption/ Transfer Application Forms to be signed by all the Joint Holders. OR
Redemption/ Transfer Application Forms to be signed by the First named Holder only.Option II
Signature of all the Joint Holders
For more than two nominees attach a statement duly signed
Application Form for Redemption of Units(Before completing the Application Form please read the guidelines)
Redemption Number
Date
The Trustee,UTP-Islamic Fund,9th Floor,Shaikh Sultan Trust Building No. 1,Beaumont Road,Karachi –75530
Authorized Branch of Distribution Company
Dear Sir
I/ We the undersigned being the registered Holder(s) of Units, as detailed below requestyou to redeem my/ our units according to the provisions of the Trust Deed and OfferingDocument of the UTP-Islamic Fund.
• Please send the cheque for the Redemption Proceeds at my Registered Address. OR• Please pay to the credit of my bank account number with
(address of the Bank)
Yours faithfully,
Part A Application
FolioNumber
SaleNo.
Certificate Number(s)(attach if issued)
Distinctive Number(s) No. of Unit(s)
Guidelines for completing the Application Form for Redemption(In case of any assistance please contact the Distribution Companies)
1) Please complete in block letters with ball pen.
2 ) At the request for the unit holder, the Transfer Agent will verify the holding and
relevant details stated in Application Form for Redemption and signature of the
Holder. In case of such ver ificat ion, the verified Application Form for
Redmption will be the only document accepted by the Trustee for redemption.
I f the ver ified Redemption Form is lost , destroyed or mutilated, a new
Redemption Form will be verified by the Transfer Agent on application by the
unit holder and on payment of such costs and on such terms as to evidence
indemnity and security.
If an Application Form for Redemption has been verified the Transfer Form will
not be verified except on surrender of the existing verified Redemption Form.
In case of transfer of Units, the verified Application Form for Redemption will
have to be surrendered.
3) Payment of redemption will be made by Trustee within six Business Days after
the receipt of a properly documented request for redemption of Units by relevant
Distribution Company.
4 ) If redemption requests on any single day exceeds 10% of the total number of
Units in issue, the Trustee shall redeem only 10%, on first come first served
basis and defer the balance to the next Business Day.
Receipt Redemption Number Date
Received from Mr./ Ms. (Holder/ First-named holder)
Application for Redemption of _________________ units of UTP-Islamic Fund with
Certificates as detailed thereof.
RECEIPT
Authorized Branch(Rubber Stamp)
(Authorized Signatory)
REDEMPTION FORM
Name(s) and Specimen Signature(s)
1
3
4
2
Holder / First Named Holder
Joint HoldersNames Signatures
SignatureName
U T P-ISLAMIC FUND
Bank
Folio Number Certificate No. Distinctive Numbers Number of Units
Authorized Branch(Rubber Stamp)
(Authorized Signatory)
Application Form for Transfer of Units(Before completing the Application Form,
please read the guidelines)
Transfer Number
Date
The Trustee,UTP-Islamic Fund,9th Floor,Shaikh Sultan Trust Building No. 1,Beaumont Road,Karachi-75530
Authorised Branch of Distribution Company
Yours faithfully,
Signature(s) of the Transferor(s)(All joint holders shall sign unless first named is authorized to sign singly)
Name(s) & Specimen Signature(s) of Transferor (s)
1
3 4
2
I am/ we are unit holder(s). My/ Our folio number isThe above units may be registered in this folio/ separate folio (see 3(c) of guidelines)
Name(s) and Specimen Signature(s) of Transferees (s)
(1)
(3) (4)
(2)
2 ) State Muslim/ Non Muslim. In case of Muslim, if not liable to Zakat, provideaffidavit
3 ) List of documents submitted: (Please mark “Y” if documents enclosed and “X”if documents not enclosed and state whether original or photocopy) (See note5 of guidelines)
• National Identity Card(s)• Memorandum and Articles of Association/ Bye Laws/ Trust Deed• Power of Attorney or other documents authorizing the officer signing the
Application Form• Board Resolution authorizing investment• Zakat Affidavit.• Any other document (specify)
TRANSFER FORM
Part A Application for Transfer
FolioNumber
SaleNo.
Certificate Number(s)(attach if issued)
Distinctive Number(s) No. of Units
Part B Particulars of Transferee
a) Name:
Name of Father/ Husband:
NIC No: Occupation:
Address:
Telephone:
E-mail:
Applicant/ First Named Joint Transferee
Transferees(s)
b) Name:
Name of Father/ Husband:
NIC No: Occupation:
E-mail:
c)Name:
Name of Father/ Husband:
NIC No: Occupation:
E-mail:
d) Name:
Name of Father/ Husband:
NIC No: Occupation:
E-mail:
Dear Sir,
I/ We
being the registered holder(s) of under mentioned unit(s) of the UTP-IslamicFund transfer the said unit(s) to the hereinafter named Transferee(s) to holdsubject to the same conditions, on which I/ we hold them.
Witness
Name:
Address:
NIC Number:
Signature:
Witness
Name:
Address:
NIC Number:
Signature:4) Request for the issue of Unit Certificate(s):
Unit(s) will be issued in registered, uncertificated form and will be confirmed by meansof an Account Statement issued by the Transfer Agent. Unit Certificate(s) (availablein the denominations of 1,5,10,50 and 100 or jumbo certificate for all the units) willbe issued only if requested and on payment of Rs. 25/- per certificate. Payment forcertificate(s) may be combined with the payment for unit(s). Unless indicated by theapplicant minimum number of certificates will be issued.
(Circle the denomination required)Include Rs. _________ for issue of unit Certificate(s)
Receipt Transfer Number _________________________ Date_________________Received from Mr./ Ms. (Name ofTransferee)Application Form for Transfer of _________________ Units of UTP- Islamic Fundand documents stated overleaf.
RECEIPT
(Authorized Signatory)Authorized Branch(Rubber Stamp)
U T P-ISLAMIC FUND
1) Payment of Dividend
Please sign (Transferee/ First Named Transferee) at the appropriate place to indicatehow you want to receive the future dividends due to you.
• To be reinvested for the purchase of units ________________(Sign) Or
• To be paid to the credit of Bank Account Number ______________ with______________ (Bank/ Branch)______________________(Sign) Or
• To be sent at the registered address_____________________ (Sign)
Guidelines for completing the Application for Transfer Form
1) Please complete the Application Form in block letters and with ball pen.
2) In case of a partnership firm or a trust, application for transfer shall be made in thename of the partners or the trustees.
3) This Application Form is divided into three parts.
a. “Part A “ is your application for transfer of units. This portion has to be filledby the transferor and the transferee. If the transferee is already a unit holder thefolio number should be stated.
b .“Part B “ is particulars of transferee for the record of the Transfer Agent. If thetransferee is already a unit holder and indicated the existing folio number inpart A, he does not have to complete Part B. If however there is any change inthe particulars the relevant port ion of Par t B should be completed.
c .“Part C” contains the instructions of the transferee, which the Transfer Agentwill record for compliance. If the transferee is already a unit holder and indicatedhis existing folio number in part A, he does not have to complete part C.However if he desires to change any of the existing instructions he may completethe relevant portion of part C and delete the remaining portion. If the transfereewants that the new instructions should only apply to the units he has now sentfor transfer and not to his previous holdings, he should ask for separate folioby so indicating in Part A and then complete Part C.
4) At the request of the unit holder, the Transfer Agent will verify the holding andrelevant details on the Transfer Application form and signature of the unit holder.In case of verification the verified Transfer Application Form will be the onlyinstrument recognized by the Transfer Agent for transfer. If the verified TransferForm is lost, destroyed or mutilated, a new verified Transfer Form will be issueon application by the unit holder and on payment of such costs and on such termsas to evidence indemnity and security, including publication in newspaper.
If a Transfer Application Form has been verified, application form for redemptionwill not be verified except on surrender of verified Transfer Application Form.
In case of redemption of units the verified Transfer Application Form will haveto be surrendered.
5) Copies of the following documents are required to be submitted by the Transfereewith the Application for Transfer of units. The Distribution Company will beentitled to verify the signature (s) on Transfer Application Form and copy of thedocuments submitted with the original documents or request for attested copies.
a)
Individuals (new applicants only) National Identity Card (s).
b)
For Corporate/ Statutory bodies (new applicants only and if there is any amendmentin these documents):
• Memorandum and Articles of Association/ Bye Laws/ Trust Deed• Power of Attorney or other documents authorizing the officer signing the
Application Form• National Identity Card in respect of the officer(s).
c) For Corporate/ Statutory bodies (on each application for transfer of units)• Board Resolution authorizing investment.
6) Unit Certificate(s) if required and Account Statement will be dispatched at theregistered address within 15 business days of the submission of a properly documentedTransfer Application Form.
7) For change in unit holder’s Register, such as address unit holder’s may please writeto the Management Company or Transfer Agent.
8) UTP-Islamic Fund will invest in securities and instruments which are approvedby Shariah Advisory Council, as Shariah - Compliant investment. Never the less, there is a possibility that, UTP-Islamic Fund may receive on its investment,income that is Haram, e.g. income which is derived from interest. Such incomewill be segregated and paid to approved charities in consultation with the ShariahAdvisory Council, where such authority is received from unit holders.Whereauthority is not recieved such income will be distributed to unit holders, who maydispose it off in a manner, they may deem neccessary.
Part C Instructions by Transferee
a) Name:
Relation with Holder:
Name of Father/ Husband:
NIC No: Share:
Address:
Particulars of Nominee(s)
b) Name:
Relation with Holder:
Name of Father/ Husband:
NIC No: Share:
Address:
FolioNumber
Certificate Number(s)(attach if issued)
Name of TransferorNo. of Units
List of documents attached (please mark "Y" if documents attached and "X" if not attached and also state whetheroriginal or photocopy)
q National Identity Card(s).q Memorandum and Articles of Association/ Bye Laws/ Trust Deed.q Power of Attorney or other documents authorizing the officer’s signing the Application Form.q Board Resolution authorizing investment.q Zakat Affidavit.q Any other documents (Give detail).
(Authorized Signatory)Authorized Branch(Rubber Stamp)
2) Instruction regarding signing of Redemption / Transfer ApplicationForms in case of Joint Holding.Circle appropriate option and in case of second option all Joint Holdersare required to sign.
3) Information about nominee(s) (not applicable in case of Joint Holding)
I nominate the following ____________________ (State number) person(s) toreceive the units held in my name according to their share in event of my death.I agree and understand the nomination(s) shall not be binding upon the Trustee,the Management Company or the Distribution Company, who may at theirsole discetion request for Succession Certificate or any other mandate froman appropriate Court or lawful authority or any indemnification before releasingthe proceeds of my unit(s) to my nominee(s). I further agree that the Trustee,the Distribution Company and/ or the Management Company shall not beliable for any issues/ disputes amongst my legal heirs and or nominees arisingout of this nomination.
The entitlement to a fraction of a unit may be consolidated and redeemed .Theproceeds may be paid to the nominees.
4) Payment to CharityI/ We authorise the Management Company to pay to authorized charitiesany Haram income accruing to the fund. (Please see note 8 of guidelines)
(Signature of Holder)
Redemption/Transfer Application Forms to be signed by all the Joint Holders. OR.
Redemption/Transfer Application Forms to be signed by the First named Holder only.
Signature of all the Joint Holders
For more than two nominees attach a statement duly signed
NoYes
PLEDGE FORM
Application Form for Pledge/ Lien of Units(Before completing the Application Form, please read the guidelines)
Pledge/ Lien Number
DateThe Trustee,UTP-Islamic Fund,9th Floor,Shaikh Sultan Trust Building No. 1,Beaumont Road,Karachi-75530
Authorised Branch of Distribution Company
Part A Application
Dear Sir,I/ We
being the registered holder(s) of units {pledger}, as detailed below, requestyou to record pledge/ lien over the following units in favor of pledgee/ lienholder(s) according to the provisions of the Trust Deed and the OfferingDocument of UTP-Islamic Fund.
In making this request I/ we recognize and understand that:
• The registration of this pledge/ lien places a responsibility on you to ensurethat for any reason whatsoever if units are redeemed save any legal bar orcourt requiring other wise, the proceeds shall be paid to the order of the lien-holder or first named joint lien-holder according to the provisions of the TrustDeed and Offering Document of UTP-Islamic Fund accruing on such units(hereinafter referred to as the Pledged Units).
• The units placed under pledge/ lien will only be redeemed on submission ofproperly filled in and signed redemption application form by the unit holder(pledger)/ authorised signatory.
• Save any legal bar or court order requiring other wise, any dividends that aredeclared on the pledged units shall be paid to the order of the unit holder(s)/pledger, any bonus units that the pledged units are entitled to shall automaticallybe marked under the lien of the lien holder.
• You do not accept any responsibility for the validity of my/ our act of placingthe pledged units under pledge/ lien nor for any obligation or commitmentsundertaken by me/ us in respect thereof.
• Τhe pledge/ lien on the pledged units shall continue till such time, it is releasedby the pledgee/ lien holder in writing.
Thanking you,
Yours faithfully,
Name(s) and signature(s) of unit holder(s)(All joint holders shall sign unless the first named is authorized to sign singly)
FolioNumber
SaleNo.
Certificate Number(s)(attach if issued)
Distinctive Number(s) No. of Unit(s)
Part B Particulars of Pledgee/ Lien Holder(s)
1) Name of Pledgee/ Lien Holder(s)
Guidelines for completing the Application Form for Pledge/ Lien(In case of any assistance, please contact the Management Company)
Head Office: Suite # 1306-1307, 13th Floor, Chapal Plaza, Hasrat Mohani Road,
Karachi-74000 Tel: (92-21) 2441311-14 Fax: (92-21) 2425652Lahore Office: 7/1, Venus Plaza, 7/E, Egerton Road, Lahore.
Tel: (92-42) 6301514, Mobile: (0303) 7595847 Fax: (92-42) 6302705or the Distribution Companies.
1) Please complete the Application Form in block letters and with ball pen.
2) Copies of the following documents are required to be submitted by the pledgee/lien holder with the Pledge/ Lien Application Form. The Distribution Companywill be entitled to verify the signature(s) on the Pledge/ Lien Application Formand copy of the documents submitted with the original documents or request forattested copies.
a) Individuals: Unit Certificates (if issued)
b) For Corporate/ Statutory bodies (on each application for pledge/ lien of units)
• Board Resolution authorizing pledge.• Unit Certificates (if issued).
3)
For change in unit holder’s and pledge/ lien holder’s Register, such as address,unit holders/ lien holders may please jointly write to the Management Companyor Transfer Agent.
Receipt Pledge/ Lien Number __________________Date_________________ Received
from Mr./ Ms. (Name of Pledger)
Application Form for pledge/ lien of _________________ units of UTP-Islamic Fund
and documents stated overleaf.
RECEIPT
Authorized Branch(Rubber Stamp)
(Authorized Signatory)
Address:
Telephone:
Fax:
Email:
Holder / First named Holder
1
3
Name Signature
Names Signatures
4
2
Name(s) and Specimen Signature(s)
Joint Holders
Pledge / First named Pledgee
1
3
Name Signature
Names Signatures
4
2
Name(s) and Specimen Signature(s)
Joint Pledgee(s)
U T P-ISLAMIC FUND
Folio NumberCertificate
Number(s) ifissued
(AttachedCertificates)
DistinctiveNumber(s)
Number of Unit(s)to be placed
under Pledge/ Lien
Name(s) ofPledge/ LienHolder(s)
Authorized Branch(Rubber Stamp)
(Authorized Signatory)
Head Office: 1306-1307, Chapal Plaza, Hasrat Mohani Road, Karachi-74000.
Tel: (92-21) 2441311-14 Fax: (92-21) 2425652
Lahore Office: 7/ 1, Venus Plaza, 7/ E, Egerton Road, Lahore.
Tel: (92-42) 6301514 Mobile: (0303) 7595847 Fax: (92-42) 6302705
E-mail: [email protected]: www.abamco.com
Disclaimer: All investments in mutual funds and securities are subject to market risks. Our target return/ dividend range cannot be guaranteed. UTP-Islamic Fund's unit price is neither guaranteed nor administered/ managed. It is based on the NAV, that may go up or down depending upon the factors and forces affecting the stock market. It is possible that the Shariah Guidelines placed on investments may result in the Fund performing differently to funds with similar objectives, but which are not subject to Shariah review . Past performance is not necessarily indicative of future results.
