Independent Capital Group

FinSA Legal Notice

1. Introduction

This document contains important information for clients of Independent Capital Group AG (hereinafter referred to as asset manager). In particular, you will find general information about the asset manager, his business activities and the relevant framework conditions. In addition, the document contains information on its products, services and their costs.

2. Information about Independent Capital Group AG

The asset manager is a stock corporation established under Swiss law with its registered office in Zurich. The company is privately owned. The asset manager is active in the areas of fund management, asset management and family office. Further information on the asset manager can be found on the website www.independent-capital.com.

3. Supervision

As managers of collective assets, the financial services of the asset manager are subject to supervision by the Swiss Financial Market Supervisory Authority FINMA.

4. Communication

The asset manager can be reached as follows:

Independent Capital Group AG

Communication with the asset manager can be in German and English. The asset manager will communicate with its clients through the agreed channels. If clients contact the asset manager electronically, e.g. online or by e-mail, the asset manager reserves the right to contact them in the same way. However, the asset manager would like to draw the attention of clients to the fact that the use of e-mails involves certain risks with regard to confidentiality. Telephone conversations with the asset manager may be recorded for regulatory reasons.

5. Services

The asset manager offers asset management services to clients in Switzerland and abroad.

In doing so, it manages client assets deposited with a bank on the basis of a power of attorney limited to administrative acts. He concludes a written asset management agreement with his clients, which regulates the tasks and powers of the asset manager as well as the rights of the client.

6. Profile

It is important for the asset manager to look after the client taking into account the overall financial circumstances. This presupposes that the client fully discloses his knowledge, experience, financial circumstances and investment objectives. This information is recorded in an individual client profile of the client and forms an important basis for the investment strategy. If a client does not wish to disclose his circumstances comprehensively, the asset manager cannot ensure that the recommended and implemented investment strategies and individual investments are appropriate and suitable for the overall circumstances of a client. This can result in a wide variety of risks or concentrations of risks. These risks are not comprehensible, unmanageable and cannot be controlled by the asset manager due to a lack of appropriate information about the client’s financial circumstances.

7. Fee of the asset manager

The asset management contract also determines the fee of the asset manager. This is usually calculated as a percentage of assets and generally consists of two parts:

An asset management fee is charged, which is usually debited directly to the customer’s account. The asset manager shall regularly report to the client on the asset management fee he has received.

When using his own investment funds, he collects the corresponding fund management fees. When calculating the asset management fee, the asset manager deducts those assets that are invested in the asset manager’s own investment funds (see Section 9). This avoids a double burden on the customer (the so-called stacking of fees).

8. Additional costs

In addition to the fees of the asset manager, the following fees and costs may be incurred, which will be charged to the client or debited to his custody account:

• Transaction costs (brokerage) of the custodian bank
• Custody fees of the custodian bank
• Other fees of the custodian bank, for example for the processing of orders and the preparation of statements and reports

9. Own investment funds

The asset manager manages a series of its own investment funds. All investment funds have the following common characteristics:

• No complex investment strategies are pursued. Nevertheless, the investment funds are only suitable for investors who have a solid knowledge of the strategies and financial instruments pursued.
• The investment funds are only suitable for investors who can cope with substantial losses. There are no capital guarantees.
• The risk tolerance of fund investors should be increased. Investment funds are unsuitable for investors with low risk tolerance.
• The investment funds are suitable for investors who have the growth of their assets as an investment objective. For other purposes, in particular for the preservation of assets, the products are only suitable under certain circumstances.

More detailed information on the investment funds and the official fund documents can be found on our website (www.independent-capital.com). In particular, the investment strategies are described and the costs of the investment funds are disclosed. The commissions and costs incurred in the management of the investment funds are indicated in particular in the ratio internationally known as the “Total Expense Ratio (TER)”. This indicator expresses the totality of those commissions and costs that are continuously charged to the assets of the investment fund (operating expenses) retrospectively in a percentage rate of net assets.

10. Risks

In connection with the services of the asset manager, it is important that the client understands the risks arising in the context of the investment activity. Both direct investments and investment products can involve significant risks and the value of an investment can rise or fall at any time. This can lead to the investor no longer or only partially recovering his capital.

Market risks: Just like the global economy, the stock market is subject to large fluctuations in value. Therefore, all other investments may temporarily be significantly below the purchase price. Accordingly, it is important that the money invested does not have to be used in the short term.

Currency risks: If assets are held that are not denominated in the investor’s reference currency, but in a foreign currency, the investor is exposed to a direct currency risk. Falling exchange rates lead to a loss of foreign currency investments. Conversely, the foreign exchange market also offers opportunities for profits.

Liquidity risk: Assets may be invested in securities that are not traded on a stock exchange or similar market. It can be difficult to find a buyer for these securities in the short term. This can increase the risk that a position cannot be liquidated.

Counterparty risks: The investor can conclude various transactions with contractual partners. If a contractual partner becomes insolvent, he can no longer or only partially settle outstanding claims of the investor. This applies in particular to the deposit of liquidity on accounts with the investor’s custodian bank.

Operational risks: The investor can become a victim of fraud or criminal acts. He may suffer losses due to misunderstandings or errors by employees of the fund management company, custodian bank or external third parties or be damaged by external events, such as natural disasters.

The brochure “Risks in trading in financial instruments” of the Swiss Bankers Association also contains general information on typical financial services in the investment sector and the risks associated with trading, buying, selling and holding financial instruments.

11. Taxes

The tax situation of the client in his country of domicile is not the responsibility of the asset manager, but that of the client. The Asset Manager recommends that the Client obtain appropriate advisory services from a local tax specialist or legal advisor. The customer is responsible for ensuring that the assets currently and in the future held at the Bank and the income, capital gains and the like generated with them are properly declared to the competent tax authorities and will continue to be properly declared in the future. The client is responsible for all tax liabilities related to the assets managed by the asset manager.

12. Legal status of the customer

Clients are typically classified as private clients by the asset manager, unless otherwise notified. Private customers enjoy the highest level of protection. Exceptionally, clients may be considered professional clients, institutional clients or eligible counterparties. This classification can be made under certain conditions to be reviewed, at the request of the customer or on the basis of the legal status of the customer (e.g. as a financial institution, pension fund or company with a professional treasury department). A classification as professional clients, institutional clients or eligible counterparties means that the knowledge, experience, financial circumstances and investment objectives of the client are not collected and taken into account or only to a limited extent.

Under certain conditions, customers can declare that they want to be divided into a different category. This can lead either to higher investment protection (opting-in) or to lower investor protection (opting-out).

Clients who have concluded a permanent written asset management agreement with the asset manager are considered qualified investors under Swiss law. One consequence of this is in particular that such clients have access to investment products that are only available to qualified investors. It is possible that such products, for example due to special risks or high complexity, are only suitable for persons who have the necessary investment knowledge. The asset manager is able to use his knowledge in the interest of the client. However, under Swiss law, the client with an asset management contract has the option of declaring in writing to the asset manager that he does not wish to be considered a qualified investor despite the asset management agreement.

13. Relationship of the asset manager to custodian banks and other financial service providers

In principle, the asset manager provides its financial services independently of banks and providers of financial products. There are no exclusive ties.

The asset manager is not a bank, does not accept any assets himself and does not take over their safekeeping. Upon request, the asset manager recommends to its clients banks and securities dealers for the deposit of the client’s assets, who in their own opinion offer a guarantee of the best possible execution of client orders from a price and quality point of view. The costs of the custodian bank will be invoiced or charged separately to the customer.

14. Use of third parties

As a rule, the asset manager provides his contractual services himself, but can also delegate asset management tasks to third parties. This is used in particular to cover customer requirements, which require special expertise. In addition, the asset manager has outsourced various operational tasks to third parties, in particular in the field of IT.

Third parties involved may obtain information on the existence and content of the relationship between the client and the asset manager. Information is only transmitted to the extent that the third party needs it for the performance of its tasks. Third parties are carefully selected, monitored and obliged to maintain appropriate secrecy by the asset manager.

15. Execution of orders

The execution of orders is usually subject to the custodian bank. The asset manager shall make arrangements to achieve the best possible result in order execution for the client. In particular, the asset manager only cooperates with third parties who guarantee the best possible result in the execution of the order.

16. Retrocessions

The remuneration of the asset manager for his services consists of the asset management fee paid by the client as well as the fund fees of the company’s own investment funds (see sections 7 to 9).

The Company may accept compensation from third parties in connection with the provision of financial services only if they:

1. have expressly informed customers in advance about the compensation and waive it; or
2. pass on the compensation in full to the customers.

The information provided to customers must include the type and scope of the compensation and must take place before the financial service is provided or before the contract is concluded. If the amount cannot be determined in advance, the Company will inform its customers about the calculation parameters and the bandwidths. Upon request, the Company will disclose the amounts actually received.

Compensation includes services that accrue to the Company in connection with the provision of a financial service from third parties, in particular brokerage fees, commissions, commissions, rebates or other asset benefits.

In connection with the management of the assets of the collective investment scheme, the Company does not accept any other fees, retrocessions or other non-cash benefits other than the fee for asset management. Retrocessions from the management of collective investment schemes are in any case fully attributable to the collective investment scheme.

17. Accountability

As a rule, the asset manager gives an account of its activities to its clients on the basis of bank receipts. The accountability can be filed quarterly or at a lower frequency. In the receipts and extracts of the custodian bank, the asset manager’s asset management fee is shown as a reference and not as an asset management cost. A performance expressed in percentage points is thus reported slightly better than the effective performance after costs. Fund fees, on the other hand, are already included in the reported performance. All fund fees are already deducted in connection with displayed or used prices and prices of investment funds. With the exception of reporting on its own investment funds, the asset manager generally does not use benchmarks to compare the performance of the portfolio. The financial instruments used are generally valued on a daily basis. In the case of indirect investments and rarely traded financial instruments, valuation may also be carried out at longer intervals.

18. Conflicts

The asset manager seeks to safeguard and reconcile the interests of its clients, shareholders and employees. Nevertheless, conflicts of interest cannot always be completely ruled out in the case of asset management companies that provide a wide range of high-quality financial services to their clients.

The asset manager wants to avoid that extraneous interests influence asset management. Therefore, the asset manager and its employees have committed themselves to high ethical standards. The asset manager expects diligence and honesty, lawful and professional action, compliance with market standards and, in particular, always attention to the interests of the client.

The asset manager or its affiliates (or their employees) may at any time buy or sell the same investment instruments as the asset manager’s clients or investment funds, enter into transactions in those investment instruments as proprietary dealers or intermediaries and provide related services.

In order to avoid or address possible conflicts of interest from the outset, the asset manager has taken the following measures to identify, prevent, settle and monitor them:

• The creation of a compliance function responsible for identifying, preventing and managing potential conflicts of interest, and taking appropriate measures where necessary;
• The establishment of appropriate organisational procedures to safeguard clients’ interests in asset management;
• The creation of a long-term wage and remuneration policy
• The regulation regarding the personal transactions of our employees;
• The regulation on the acceptance of gifts and other benefits by our employees;
• The constant training of our employees.

19. Privacy

The asset manager processes data in accordance with the provisions of Swiss and European data protection laws. In order to be able to serve our customers, we need personal information about the customers and their financial circumstances. Our processing of data is based exclusively on our legitimate interests in the context of customer service, We process your personal data only for the stated purposes. Your personal data will not be transmitted to third parties for purposes other than those mentioned. Of course, we will also provide you with information about the personal data we have stored about you at any time. We are happy to correct or delete these at your request, provided that there are no legal storage obligations to the contrary. Our detailed privacy policy can be found in the legal notices on our website.

20. Confidentiality and disclosure of customer data

Due to legal provisions on the protection of secrets and other professional secrets, the members of the executive bodies of the asset manager, its employees and agents are obliged to maintain secrecy for an unlimited period of time with regard to client data and information made available to them on the basis of business relationships. For the provision of its services as well as for the protection of its justified claims, it is necessary for the asset manager to pass on data covered by the protection of secrets to third parties in Germany or abroad, e.g. within the framework of legal reporting obligations or after an order by an authority or a court. The disclosure of customer data can take place in any form, in particular also by electronic transmission or physical delivery of documents.

21. Dormant

The asset manager is obliged to work towards this. that contact between client and asset manager is maintained or can be restored. To ensure that assets are not completely forgotten by clients or their heirs, the asset manager is dependent on the help of their clients. Please inform the asset manager if the address he is using no longer applies. Inform the asset manager if you are travelling for a longer period of time and if your mail is to be delivered to a third party. One way to avoid dormant is to inform a trusted person about your customer relationship. However, the asset manager can only provide information to such a person if he has been authorised to do so in writing by you.

22. Ombudsman’s Office

The asset manager is affiliated with the Swiss Financial Ombudsman Office (FINOS). For questions and complaints, our customers can also contact the Ombudsman’s Office. FINOS is neutral and strives to work out amicable solutions for all parties within the framework of conciliation procedures and to avoid costly legal disputes. The Ombudsman’s Office can be reached as follows:

Address:

Financial Ombudsman Office Switzerland (FINOS)
Talstrasse 20 (1. Floor)
CH-8001 Zurich

Telephone:

Switzerland: 044 552 08 00
Abroad: +41-44 552 08 00

Email:

info@finos.ch

Independent Capital Group AG

Waldmannstrasse 8

8001 Zurich

Branch

Sternengasse 21

4051 Basel