Offer of Units at Rs. 10 each plus applicable entry load during the New Fund Offer Period, and at NAV based prices thereafter

This Offer Document sets forth concisely the information about the Scheme that a prospective investor ought to know before investing. This Offer Document should be retained for future reference. The particulars of the Scheme has been prepared in accordance with the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996, as amended till date, and filed with the Securities and Exchange Board of India, and the Units being offered for the public subscription have not been approved or disapproved by the Securities and Exchange Board of India nor has the Securities and Exchange Board of India certified the accuracy or adequacy of this Offer Document.

This Offer Document will remain effective till a 'material change' (other than a change in Fundamental Attributes and within the purview of this Offer Document) occurs and thereafter the changes shall be filed with Securities and Exchange Board of India and circulated to the Unitholders or as may be publicly notified by advertisements in the newspapers subject to applicable regulations. Investors may also like to ascertain about any further changes after the date of this Offer Document from the Mutual Fund / it's Investor Service Centres / distributors.

Investing in mutual fund schemes involves certain risks and considerations associated generally with making investments in securities. The value of the Scheme’s investments may be affected generally by factors affecting financial markets, such as price and volume, volatility in interest rates, currency exchange rates, changes in regulatory and administrative policies of the Government or any other appropriate authority (including tax laws) or other political and economic developments. Consequently, there can be no assurance that the Scheme offered in this Offer Document would achieve the stated objectives. The NAV of the Units of the Scheme may fluctuate and can go up or down. Past performance of the schemes managed by the Sponsors or their affiliates or the Asset Management Company is not indicative of the future performance of the Scheme nor will the performance of the Scheme, following the commencement of the operations, be indicative of the Scheme’s future performance.

Prospective investors are advised to review this Offer Document carefully and in its entirety and consult their legal, tax and financial advisors to determine possible legal, tax and financial or any other consequences of subscribing to, purchasing or holding Units under the Scheme, before making an application to subscribe or purchase the Units.

The ABN AMRO Mutual Fund (the Fund) and the ABN AMRO Asset Management Company Limited (the AMC), have not authorized any person to give any information or make any representations, either oral or written, not stated in this Offer Document in connection with issue of Units under the Scheme. Prospective investors are accordingly advised not to rely upon any information or representations not incorporated in this Offer Document. Any subscription, purchase or sale made by any person on the basis of statements or representations which are not contained in this Offer Document or which are inconsistent with the information contained herein shall be solely at the risk of the investor.

Unitholders / investors are requested to read and understand the Offer Document, Key Information Memorandum and risk factors furnished with the scheme in which they seek to make investments or in which they have invested. Unitholders / Investors are urged not to rely upon or be mislead by any oral promises or statements made by the distributors / intermediaries of the Mutual Fund and it is brought to the special attention of investors that the AMC / Mutual Fund will not be liable for mis-statement or communication by agents / distributors which are not previously expressly authorized / approved by the AMC / Mutual Fund.

The AMC, Trust and the Mutual Fund shall not be responsible for any claims made by the Unitholders / Investors based on such oral promises made by the distributors / intermediaries.

· Mutual Funds and securities investments are subject to market risks and there can be no assurance or guarantee that the Scheme objectives will be achieved.

· As with any investment in securities, the NAV of Units issued under the Scheme may go up or down depending on the various factors and forces affecting the capital markets. The various factors which impact the value of the Scheme’s investments include, but are not limited to, fluctuations in the equity and bond markets, fluctuations in interest rates, prevailing political and economic environment, changes in government policy, factors specific to the issuer of the securities, tax laws, liquidity of the underlying instruments, settlement periods, trading volumes etc.

· Past performance of the Sponsors and its affiliates / Mutual Fund / AMC does not indicate the future performance of the Scheme of the Mutual Fund.

· ABN AMRO China Equity Fund is the name of the Scheme and does not in any manner indicate either the quality of the Scheme or its future prospects and returns.

· The Sponsor is not liable or responsible for any loss or shortfall resulting from the operations of the Scheme.

· Investors should study this Offer Document carefully in its entirety before investing and retain the Offer Document for future references.

· Unitholders in the Scheme are not being offered any guaranteed / assured returns.

SCHEME SPECIFIC RISK FACTORS AND SPECIAL CONSIDERATIONS

· The scheme intends to invest primarily in Chinese equity and equity related instruments. Thus risks applicable to equity investments and overseas investments are applicable to the scheme.

· Since the Fund intends to invest primarily in China, there is a country risk including events such as introduction of extraordinary exchange controls, economic deterioration, bi-lateral conflict leading to immobilization of the overseas financial assets, political uncertainty, prevailing laws and policy matters including prevalent tax laws of the respective jurisdiction for execution of trades or otherwise applicable for investments in China and the jurisdiction through which settlement of such transactions will take place

· Concentration risk: As the portfolio will primarily invest in stocks of

China

, the portfolio shall be exposed to the political, economic and social risks with respect to said country and the country of settlement, if applicable. However, such investment is always subject to concentration risk.

· Equity instruments by nature are volatile and prone to price fluctuations on a daily basis due to both macro and micro factors. Trading volumes, settlement periods and transfer procedures may restrict the liquidity of these investments. Different segments of financial markets have different settlement periods and such periods may be extended significantly by unforeseen circumstances. The inability of the Scheme to make intended securities’ purchases due to settlement problems could cause the Scheme to miss certain investment opportunities.

· To the extent the assets of the scheme are invested in overseas financial assets, there may be risks associated with currency movements, restrictions on repatriation and transaction procedures in overseas market. Further, the repatriation of capital to

India

may also be hampered by changes in regulations or political circumstances as well as the application to it of other restrictions on investment. In addition, country risks would include events such as introduction of extraordinary exchange controls, economic deterioration, bi-lateral conflict leading to immobilization of the overseas financial assets and the prevalent tax laws of the respective jurisdiction for execution of trades or otherwise.

· As the Fund will invest in securities which are denominated in foreign currencies (e.g. US Dollars, HK Dollars), fluctuations in the exchange rates of these foreign currencies may have an impact on the income and value of the fund. The investment manager in

India

may hedge the currency risk based on his view on the forex markets.

· As the portfolio may invest in stocks in multiple currencies, the portfolio shall be exposed to the political, economic and social risks with respect to each country.

· The fund will be exposed to settlement risk, as different countries have different settlement periods.

· Investors in the scheme may be subject to additional disclosure requirements in overseas jurisdictions as beneficial owners of the scheme’s assets.

· The Scheme may also use various derivative products (including currency hedges) from time to time, as would be available and permitted by SEBI and RBI, in an attempt to protect the value of the portfolio and enhance Unitholders’ interest.

· Investments in equity and equity related securities involve a degree of risks and investors should not invest in the Scheme unless they can afford to take the risk of losing their investment.

· As the Scheme is proposing to invest a part of its net assets in foreign securities, the liquidation of such securities shall be subjected to the liquidity / settlement issues of the County of investment/ settlement. Non-business days of Country of investment/ settlement may impact the liquidity of the scheme investments.

· It may be noted that if rupee appreciates, it will lead to reduction in yield to investor.

Global monetary tightening will reduce the global liquidity, which in turn will impact the capital flows into emerging markets like

China

has large current account surplus with US due to large amount of goods & services exports, the reduction in US GDP growth will impact the growth of economies of

China

. This in turn will negatively impact the capital markets.

Heightened geo -political tensions will increase political tensions among various countries, which could impact the global GDP growth. This will impact the growth of

China

as it is playing a significant role in Global GDP growth. This in turn will influence Chinese Markets.

China

is one of the large consumers of commodities across the Globe, the rising oil prices and commodity prices will hurt the economic growth which may further impact the Chinese markets.

The rising labour costs will reduce corporate profits, which in turn impact the earnings reported by companies thus influence the stock prices.

Ø Downside surprises in the external demand from the

United States

in particular, is another key risk to

China

since

United States

is the largest trading partner of

China

Ø Chinese Government may adopt some monetary policy tightening measures like rise the reserve requirements and official interest rates increase.

Ø External pressures (Political pressure from

United States

) might influence the currency movement upwards, which in turn, could hurt external sector and might slow down economic growth.

Subject to the stated investment objective, the Scheme proposes to invest in debt and related instruments.

· Price-Risk or Interest Rate Risk: As with all debt securities, changes in interest rates may affect the NAV of the Scheme as the prices of securities increase as interest rates decline and decrease as interest rates rise. Prices of long term securities generally fluctuate more in response to interest rate changes than do short-term securities. Indian debt markets can be volatile leading to the possibility of price movements up or down in fixed income securities and thereby to possible movements in the NAV. In the case of floating rate instruments, an additional risk could be due to the change in the spreads of floating rate instruments. If the spreads on floating rate papers rise, then there could be a price loss on these instruments. Secondly in the case of fixed rate instruments that have been swapped for floating rates, any adverse movement in the fixed rate yields vis-à-vis swap rates could result in losses. However, floating rate debt instruments, which have periodical interest rate, reset, carry a lower interest rate risk as compared to fixed rate debt instruments. In a falling interest rate scenario the returns on floating rate debt instruments may not be better than those on fixed rate debt instruments.

· Liquidity or Marketability Risk: This refers to the ease with which a security can be sold at or near to its valuation yield-to-maturity (YTM). The primary measure of liquidity risk is the spread between the bid price and the offer price quoted by a dealer. Liquidity risk is today characteristic of the Indian fixed income market.

· Credit Risk: Credit risk or default risk refers to the risk that an issuer of a fixed income security may default (i.e. will be unable to make timely principal and interest payments on the security). Because of this risk, corporate debentures are sold at a yield above those offered on Government Securities, which are sovereign obligations. Normally, the value of a fixed income security will fluctuate depending upon the changes in the perceived level of credit risk as well as any actual event of default. The greater the credit risk, the greater the yield required for someone to be compensated for the increased risk.

· Reinvestment Risk: This risk refers to the interest rate levels at which cash flows received from the securities in the Scheme are reinvested. The additional income from reinvestment is the “interest on interest” component. The risk is that the rate at which interim cash flows can be reinvested may be lower than that originally assumed.

· The floating rate segment of the domestic debt market is not very developed. Currently, majority of the issuance of floating rate papers is linked to NSE MIBOR. As the floating rate segment develops further, more benchmark rates for floating papers may be available in future. The fewer number of benchmark rates could result in limited diversification of the benchmark risk.

Different types of securities in which the scheme would invest as given in the Offer Document carry different levels and types of risk. Accordingly the scheme’s risk may increase or decrease depending upon its investment pattern.

E.g. corporate bonds carry a higher amount of risk than Government Securities. Further even among corporate bonds, bonds which are AAA rated are comparatively less risky than bonds which are AA rated.

· Investments in money market instruments would involve a moderate credit risk i.e. risk of an issuer's liability to meet the principal payments. Additionally, money market securities, while fairly liquid, lack a well-developed secondary market, which may restrict the selling ability of the Scheme and may lead to the Scheme incurring losses till the security is finally sold.

· Money market instruments may also be subject to price volatility due to factors such as changes in interest rates, general level of market liquidity and market perception of credit worthiness of the issuer of such instruments. The AMC endeavours to manage such risk by the use of inhouse credit analysis.

· The NAV of the Scheme's Units, to the extent that the Scheme is invested in money market instruments, will be affected by the changes in the level of interest rates. When interest rates in the market rise, the value of a portfolio of money market instruments can be expected to decline.

Scheme may invest in domestic securitized debt such as asset backed securities (ABS) or mortgage backed securities (MBS). Asset Backed Securities (ABS) are securitized debts where the underlying assets are receivables arising from automobile loans, personal loans, loans against consumer durables, etc. Mortgage backed securities (MBS) are securitized debts where the underlying assets are receivables arising from loans backed by mortgage of residential / commercial properties. ABS/MBS instruments reflect the undivided interest in the underlying pool of assets and do not represent the obligation of the issuer of ABS/MBS or the originator of the underlying receivables. The ABS/MBS holders have a limited recourse to the extent of credit enhancement provided. If the delinquencies and credit losses in the underlying pool exceed the credit enhancement provided, ABS/MBS holders will suffer credit losses. ABS/MBS are also normally exposed to a higher level of reinvestment risk as compared to the normal corporate or sovereign debt. Following are some of the types of loans that are amortised :

The main risks pertaining to each of the asset classes above are described below:

· The underlying assets (cars etc) are susceptible to depreciation in value whereas the loans are given at high loan to value ratios. Thus, after a few months, the value of asset becomes lower than the loan outstanding. The borrowers, therefore, may sometimes tend to default on loans and allow the vehicle to be repossessed.

· These loans are also subject to model risk. ie if a particular automobile model does not become popular, loans given for financing that model have a much higher likelihood of turning bad. In such cases, loss on sale of repossession vehicles is higher than usual.

· Commercial vehicle loans are susceptible to the cyclicality in the economy. In a downturn in economy, freight rates drop leading to higher defaults in commercial vehicle loans. Further, the second hand prices of these vehicles also decline in such economic environment.

· Housing loans in

India

have shown very low default rates historically. However, in recent years, loans have been given at high loan to value ratios and to a much younger borrower classes. The loans have not yet gone through the full economic cycle and have not yet seen a period of declining property prices. Thus the performance of these housing loans is yet to be tested and it need not conform to the historical experience of low default rates.

· The underlying security for such loans is easily transferable without the bank’s knowledge and hence repossession is difficult.

· The underlying security for such loans is also susceptible to quick depreciation in value. This gives the borrowers a high incentive to default.

· These are unsecured loans. In case of a default, the bank has no security to fall back on.

· All the above loans are retail, relatively small value loans. There is a possibility that the borrower takes different loans using the same income proof and thus the income is not sufficient to meet the debt service obligations of all these loans.

· In

India

, there is no ready database available regarding past credit record of borrowers. Thus, loans may be given to borrowers with poor credit record.

The Scheme may also use various derivative and hedging products from time to time, as would be available and permitted by SEBI, in an attempt to protect the value of the portfolio

As and when the Scheme(s) deals in the derivatives market there are risk factors and issues concerning the use of derivatives that investors should understand. Derivative products are specialised instruments that require investment techniques and risk analysis different from those associated with stocks and bonds. The use of a derivative requires an understanding not only of the underlying instrument but also of the derivative itself. Derivatives require the maintenance of adequate controls to monitor the transactions entered into, the ability to assess the risk that a derivative adds to the portfolio and the ability to forecast price or interest rate movements correctly. There is the possibility that a loss may be sustained by the portfolio as a result of the failure of another party (usually referred to as the "counter party") to comply with the terms of the derivatives contract. Other risks in using derivatives include the risk of mispricing or improper valuation of derivatives and the inability of derivatives to correlate perfectly with underlying assets, rates and indices. Thus, derivatives are highly leveraged instruments. Even a small price movement in the underlying instrument could have a large impact on their value. Also, the market for derivative instruments is nascent in

India

Derivative products are leveraged instruments and can provide disproportionate gains as well as disproportionate losses to the investor. Execution of such strategies depends upon the ability of the fund manager to identify such opportunities. Identification and execution of the strategies to be pursued by the fund manager involve uncertainty and decision of fund manager may not always be profitable. No assurance can be given that the fund manager will be able to identify or execute such strategies.

The risks associated with the use of derivatives are different from or possibly greater than, the risks associated with investing directly in securities and other traditional investments.

Securitised Debt: Securitised debt papers carry credit risk of the Obligors and are dependent on the servicing of the PTC / Contributions etc. However these are offset suitably by appropriate pool selection as well as credit enhancements specified by Rating Agencies. In cases where the underlying facilities are linked to benchmark rates, the Securitised debt papers may be adversely impacted by adverse movements in benchmark rates. However this risk is mitigated to an extent by appropriate credit enhancement specified by rating agencies. Securitised debt papers also carry the risks of prepayment by the obligors. In case of prepayments of securities debt papers, it may result in reduced actual duration as compared to the expected duration of the paper at the time of purchase, which may adversely impact the portfolio yield. These papers also carry risk associated with the collection agent who is responsible for collection of receivables and depositing them. The Investment teams evaluate the risks associated with such investments before making an investment decision.

The underlying assets in the case of investment in Securitised debt could be mortgages or other assets like credit card receivables, automobile / vehicle / personal / commercial / corporate loans and any other receivables / loans / debt.

Credit card receivables are unsecured. Automobile / vehicle loan receivables are usually secured by the underlying automobile / vehicle and sometimes by a guarantor. Mortgages are secured by the underlying property. Personal loans are usually unsecured. Corporate loans could be unsecured or secured by a charge on fixed assets / receivables of the company or a letter of comfort from the parent company or a guarantee from a bank / financial institution. As a rule of thumb, underlying assets which are secured by a physical asset / guarantor are perceived to be less risky than those which are unsecured. By virtue of this, the risk and therefore the yield in descending order of magnitude would be credit card receivables, personal loans, vehicle /automobile loans, mortgages and corporate loans assuming the same rating.

· ADRs / GDRs : It is the AMC’s belief that investment in ADRs / GDRs offers new investment and portfolio diversification opportunities into multi-market and multi-currency products. However, such investments also entail additional risks. Such investment opportunities may be pursued by the AMC provided they are considered appropriate in terms of the overall investment objectives of the Scheme. Since the Scheme would invest only partially in ADRs / GDRs, there may not be readily available and widely accepted benchmarks to measure performance of the Scheme. To manage risks associated with foreign currency and interest rate exposure, the Fund may use derivatives for efficient portfolio management including hedging and in accordance with conditions as may be stipulated by SEBI / RBI from time to time.

· Offshore Investments : Will be made subject to any / all approvals, conditions thereof as may be stipulated by SEBI/RBI and provided such investments do not result in expenses to the Fund in excess of the ceiling on expenses prescribed by and consistent with costs and expenses attendant to international investing. The Fund may, where necessary, appoint other intermediaries of repute as advisors, custodian/sub-custodians etc. for managing and administering such investments. The appointment of such intermediaries shall be in accordance with the applicable requirements of SEBI and within the permissible ceiling of expenses. The fees and expenses would illustratively include, besides the investment management fees, custody fees and costs, fees of appointed advisors and sub-managers, transaction costs and overseas regulatory costs

To the extent that the assets of the Scheme will be invested in ADRs/GDRs denominated in foreign currencies, the Indian Rupee equivalent of the net assets, distributions and income may be adversely affected by changes in the value of certain Foreign currencies relative to the Indian Rupee. The repatriation of capital to

India

may also be hampered by changes in regulations concerning exchange controls or political circumstances as well as the application to it of other restrictions on investment.

· Suspicious Transaction Reporting: If after due diligence, the AMC believes that the transaction is suspicious in nature as regards money laundering, the AMC shall report any suspicious transactions to competent authorities under the PMLA and rules / guidelines issued thereunder by SEBI and RBI, furnish any such information in connection therewith to such authorities and take any other actions as may be required for the purposes of fulfilling its obligations under the PMLA without obtaining the prior approval of the investor / Unit Holder / a person making the payment on behalf of the investor.

· As per SEBI circular dated December 12, 2003 and June 14, 2005 ref SEBI / IMD / CIR No.10 / 22701 /03 and SEBI/IMD/CIR/No.1/42529/05 respectively and AMFI Communication having ref. no. 35/MEM-COR/55/04-05 dated December 31, 2004, each scheme and individual plan(s) under the schemes should have a minimum of 20 investors and no single investor should count for more than 25% of the corpus of such Scheme/Plan. In case of non-fulfilment with former condition in a three months time period or the end of succeeding calendar quarter, whichever is earlier from the close of the New Fund Offer (NFO) of the Scheme or on an ongoing basis for each calendar quarter, the Schemes/plans shall be wound up by following the guidelines prescribed by SEBI and the Investor’s units would be redeemed at applicable NAV.

As per SEBI circular dated June 14, 2005 ref. no. SEBI/IMD/CIR No.1/42529/05, determining the breach of the 25 % limit by an Investor, the average net assets of the scheme would be calculated daily and any breach of the 25% holding limit by an investor would be determined. At the end of the quarter, the average of daily holding by each such investor is computed to determine whether that investor has breached the 25 % limit over the quarter. If there is a breach of limit by any investor over the quarter, a rebalancing period of one month would be allowed and thereafter the investor who is in breach of the rule shall be given 15 days notice to redeem his exposure over the 25 % limit. Failure on the part of the said investor to redeem his exposure over the 25 % limit within the aforesaid 15 days would lead to automatic redemption by the Mutual Fund on the applicable Net Asset Value on the 15th day of the notice period.

Further, the aforesaid SEBI circulars would be applicable at the Portfolio level.

· It may be noted that the Scheme would be predominately investing in the Chinese Equities & Equity related securities and not in Domestic Companies; hence it does not fall in the purview of definition of “Equity Oriented Fund” of Income Tax Act. Therefore, Investors will not be entitled for the tax benefits of Equity Oriented Fund, as for taxation purpose; the Scheme will be treated as a Debt Scheme.

· The tax benefits described in this Offer Document are as available under the prevailing taxation laws. Investors / Unit Holders should be aware that the relevant fiscal rules or their interpretation may change. As is the case with any investment, there can be no guarantee that the tax position or the proposed tax position prevailing at the time of an investment in the Scheme will endure indefinitely. In view of the individual nature of tax consequences, each Unit Holder is advised to consult his / her / their own professional tax advisor.

From time to time and subject to the Regulations, funds managed by the affiliates / associates of the Sponsor may invest either directly or indirectly in the Scheme. The funds managed by these affiliates / associates may acquire a substantial portion of the Scheme's Units and collectively constitute a major investment in the Scheme. Accordingly, Redemption of Units held by such funds may have an adverse impact on the value of the Units of the Scheme because of the timing of any such Redemption and may affect the ability of other Unit Holders to redeem their respective Units.

DEFINITIONS

In this Offer Document, the following words and expressions shall have the meaning specified herein, unless the context otherwise requires:

For all purposes of this Offer Document, except as otherwise expressly provided or unless the context otherwise requires:

· All references to the masculine shall include the feminine and all references, to the singular shall include the plural and vice-versa.

· All references to "Euros" refer to the currency of some Member States of the European Union, "dollars" or "$" refer to United States Dollars, “HKD” refers to Hong Kong Dollars and "Re" / "Rs" refers to Indian Rupee(s). A "crore" means "ten million" and a "lakh" means a "hundred thousand".

Words and Expressions used and not defined in this Offer Document shall have the same meaning as in the SEBI Regulations.

DUE DILIGENCE BY THE ASSET MANAGEMENT COMPANY

A Due Diligence Certificate duly signed by the Head - Compliance & Risk Management of ABN AMRO Asset Management (

India

) Limited has been submitted to SEBI on December 5, 2007, which reads as follows.

(i) The draft Offer Document forwarded to SEBI is in accordance with the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 and the guidelines and directives issued by SEBI from time to time.

(ii) All legal requirements connected with the launching of the Scheme as also the guidelines, instructions, etc. issued by the Government of India and any other competent authority in this behalf, have been duly complied with.

(iii) The disclosures made in this Offer Document are true, fair and adequate to enable the investors to make a well-informed decision regarding investments in the proposed Scheme.

(iv) The intermediaries named in this Offer Document are registered with SEBI and till date such registrations are valid.

SECTION I

SUMMARY OF THE SCHEME - ABN AMRO China Equity Fund -An Open-Ended Equity Scheme investing in Chinese Equities with no assured returns

CONSTITUTION OF THE MUTUAL FUND

THE MUTUAL FUND

ABN AMRO Mutual Fund has been constituted as a trust in accordance with the provisions of the Indian Trusts Act, 1882, by the Sponsor, as per the terms of the Trust Deed dated April 15, 2004. The Trust Deed has been registered under the Indian Registration Act, 1908. The Mutual Fund has been registered with SEBI, vide. Registration No. MF/049/04/01 dated May 27, 2004.

The office of the Mutual Fund is at 101, 10^th Floor, Sakhar Bhavan, Nariman Point, Mumbai 400 021.

The Mutual Fund has been formed with the purpose of pooling capital from the public for collective investment in securities / any other property for the purpose of providing facilities for participation by persons as beneficiaries in such properties / investments and in the profits / income arising therefrom beyond this contribution.

THE SPONSOR

Consequent to receipt of no-objection letter received from SEBI (its letter no. IMD/SB/46021/05 dated August 4, 2005), the controlling interest in the AMC was transferred from ABN AMRO Bank N.V. to ABN AMRO Asset Management (Asia) Limited ("AAAM Asia") with effect from October 31, 2005.

AAAM Asia holds 75% of the paid-up equity share capital of the AMC. In view of the same details of AAAM Asia are being provided hereunder

Given below is a brief summary of AAAM Asia's financials in the last three years as on December 31:

(1) Free Reserves are Other Reserves of the Sponsor and do not include Share premium account, Revaluation reserves and Other Reserves prescribed by law.

(2) Net-worth means aggregate of Equity Capital and all Reserves of the Sponsor.

AAAM Asia was incorporated in Hong Kong on 29 October 1991 and is licensed with the Securities and Futures Commission to conduct Type 1 (dealing in securities), Type 4 (advising on securities), Type 5 (advising on futures contracts) and Type 9 (asset management) regulated activities under the Securities and Futures Ordinance.

AAAM Asia is a wholly owned subsidiary of ABN AMRO Holding N.V., incorporated in the

Netherlands

. AAAM Asia specializes in the Asian markets for both investment funds' advisory and discretionary mandates. It also promotes ABN AMRO's global products in the Asian region to both institutional investors and private clients. AAAM Asia is the Asian asset management centre for ABN AMRO's global asset management business.

ABN AMRO Bank N.V. in 2004 had contributed an amount of Rs. 1,00,000 (Rupees One Lakh Only) to the corpus of the Mutual Fund. AAAM Asia is not liable or responsible for any loss or shortfall resulting from the operations of the Schemes.

THE TRUSTEE

ABN AMRO Trustee (

India

) Private Limited, a company incorporated under the Companies Act, 1956, on November 4, 2003, is appointed as the Trustee to the Mutual Fund vide the Trust Deed dated April 15, 2004. ABN AMRO Trustee (

India

) Private Limited is a subsidiary of ABN AMRO Asset Management (Asia) Limited.

The registered office of the Trustee is situated at 101, 10^th Floor, Sakhar Bhavan, Nariman Point, Mumbai 400 021.

TRUSTEE - FEES AND EXPENSES

Pursuant to the Trust Deed constituting the Mutual Fund, the Trustee in addition to reimbursement of all costs, charges and expenses incurred in or about the administration and execution of the Mutual Fund, is entitled to receive a fee computed at a rate specified in the individual Scheme offer document, subject to a maximum of Rs. 10,00,000 (Rupees Ten Lakhs) per annum. The Trustee may charge further fees as permitted from time to time under the Trust Deed and the SEBI Regulations.

SUMMARY OF THE SUBSTANTIVE PROVISIONS OF THE TRUST DEED

The Trust Deed dated April 15, 2004 contains, among others, the following clauses that may be of material interest to the investor:

· It shall be the responsibility of the Trustee in carrying out its responsibilities to maintain arms’ length relationship with other companies or institutions or financial intermediaries or any body corporate with which the Trustee may be associated.

· It shall be the duty of the Trustee to take into its custody or under their control all the property of the Schemes of the Mutual Fund and hold these in trust for the Unitholders. The Trustee shall be accountable for and be the custodian of the funds and property of the Schemes and shall hold the same for the benefit of the Unitholders in accordance with the SEBI regulations and the provisions of the Trust Deed.

· It shall be the duty of the Trustee to act in the interest of the Unitholders.

· It shall be the duty of the Trustee to provide or cause to provide information to the Unitholders and SEBI as may be required by SEBI from time to time

· The Trustee shall supervise the collection of any income due to be paid to the Scheme of the Mutual Fund and for claiming any repayment of tax and holding any income received in trust for the Unitholders in accordance with the Trust Deed and the SEBI Regulations.

· The Trustee shall not acquire any asset out of the Mutual Fund which involves the assumption of any liability which is unlimited or which results in encumbrance of the Mutual Fund in any way.

· It shall be the duty of the Trustee to take reasonable care to ensure that the funds under the Schemes floated by and managed by the AMC are in accordance with the Trust Deed and the SEBI Regulations.

· The Sponsor or the Trustee shall be entitled by one or more Deed/s supplemental to the Trust Deed to amend, modify, alter or add to the provisions of the Trust Deed in such manner and to such extent as they may consider expedient for any purpose, provided that:

(i) no such amendment, modification, alteration or addition shall be made without the approval of the Unitholders and SEBI;

(ii) no such modification, alteration or addition shall impose upon any Unitholder any obligation to make any further payment in respect of his Units or to accept any liability in respect thereof.

· Where the SEBI Regulations provide for seeking the approval of the Unitholders for any purpose, the Trustee may adopt any of the following procedures:

(ii) Approval of the Unitholders present and voting at a meeting to be specifically convened by the Trustee for the purpose. For this purpose, the Trustees shall give 21 days notice to the Unitholders and the Trustees may lay down guidelines for the actual conduct and accomplishment of the voting at the meeting and announcement of the results.

· The number of Directors of the Board shall not be less than 4 (or such other number as specified by SEBI from time to time). Subject to the provisions of the SEBI Regulations, at least two thirds of the Directors of the Board shall be independent Directors and shall not be associated with the Sponsor or be associated with the Sponsor in any manner whatsoever.

· A Director shall not participate in the meetings of the Trustee or in any decision making process for any investments in which he may be interested.

· It shall be the duty of each Director to furnish to the Trustee, the particulars of any interest which he may have in any other company or institution or financial intermediaries or any corporate body by virtue of his position as Director, partner or with which he may be associated in any other capacity.

· The Board shall meet atleast once every two calendar months and atleast six meetings of the Board shall be held in every year. The quorum for such meeting shall be 2(two) Directors of the Board or 1/3 Directors which ever is higher. The quorum for the meetings of the Board shall always include the presence of atleast one Independent Director.

· The Trustee shall have power to dismiss the Asset Management Company under specific events only with the approval of SEBI in accordance with the SEBI Regulations.

· The Trustee shall appoint a Custodian and enter into a custodian agreement on behalf of the Mutual Fund with the Custodian in accordance with the SEBI Regulations and shall be responsible for the supervision of its activities in relation to the Mutual Fund.

· The unit holders of the Scheme would have beneficial interest in the trust property to the extent of individual holding in respective schemes only.

RIGHTS, DUTIES AND RESPONSIBILITIES OF THE TRUSTEE UNDER THE SEBI REGULATIONS

Under the SEBI Regulations, the Trustee has, inter-alia, the following rights, duties and responsibilities:

· The Trustee shall have a right to obtain from the Asset Management Company such information as is considered necessary by the Trustee.

· The Trustee shall ensure before the launch of any scheme that the Asset Management Company has-

(b) appointed all key personnel including fund manager(s) for the Scheme and submitted their bio-data which shall contain the educational qualifications, past experience in the securities market with the Trustee, within 15 days of their appointment;

(d) appointed a compliance officer who shall be responsible for monitoring the compliance of the Securities and Exchange Board of India Act, 1992, rules and regulations, notifications, guidelines instructions etc issued by SEBI or the Central Government and for redressal of investors’ grievances;

(f) prepared a compliance manual and designed internal control mechanisms including internal audit systems;

(h) ensured that the Scheme ABN AMRO China Equity Fund approved by Trustee is a new product offered by the Fund and is not a minor modification of the existing scheme/fund/product.

° the Asset Management Company has been diligent in empanelling the brokers, in monitoring securities transactions with brokers and avoiding undue concentration of business with any broker;

° the Asset Management Company has not given any undue or unfair advantage to any associates or dealt with any of the associates of the Asset Management Company in any manner detrimental to interest of the Unitholders;

° the transactions entered into by the Asset Management Company are in accordance with the SEBI Regulations and the scheme;

° the Asset Management Company has been managing the Mutual Fund schemes independently of other activities and have taken adequate steps to ensure that the interest of investors of one scheme are not being compromised with those of any other scheme or of other activities of the Asset Management Company; and

° all the activities of the Asset Management Company are in accordance with the provisions of the SEBI Regulations.

· Where the Trustee have reason to believe that the conduct of business of the Mutual Fund is not in accordance with the SEBI Regulations and the scheme they shall forthwith take such remedial steps as are necessary by them and shall immediately inform SEBI of the violation and the action taken by them.

· The Trustee shall take steps to ensure that the transactions of the Mutual Fund are in accordance with the provisions of the Trust Deed.

· The Trustee shall be responsible for the calculation of any income due to be paid to the Mutual Fund and also of any income received in the Mutual Fund for the holders of the Units of any scheme in accordance with the SEBI Regulations and the Trust Deed.

° whenever required to do so on the requisition made by three-fourths of the Unitholders of any scheme; or

° when the majority of the Board of Directors of the Trustee decide to wind up or prematurely redeem the Units.

· The Trustee shall ensure that no change in the fundamental attributes of any scheme or the trust or fees and expenses payable or any other change which would modify the scheme and affects the interest of Unitholders, shall be carried out unless:

° a written communication about the proposed change is sent to each Unitholder and an advertisement is given in one English daily newspaper having nationwide circulation as well as in a newspaper published in the language of the region where the Head Office of the Mutual Fund is situated; and

° the Unitholders are given an option to exit at the prevailing Net Asset Value without any exit load.

· The Trustee shall quarterly review all transactions carried out between the Mutual Fund, Asset Management Company and its associates.

· Each trustee shall file the details of his transactions of dealing in securities with the Mutual Fund on a quarterly basis.

· The trustees shall call for the details of transactions in securities by the key personnel of the asset management company in his own name or on behalf of the asset management company and shall report to the Board, as and when required.

· The Trustee shall quarterly review the net worth of the Asset Management Company and in case of any shortfall, ensure that the Asset Management Company make up for the shortfall as per clause (f) of sub-regulation (1) of SEBI Regulation 21.

· The Trustee shall periodically review all service contracts such as custody arrangements, transfer agency of the securities and satisfy itself that such contracts are executed in the interest of the Unitholders.

· The Trustee shall ensure that there is no conflict of interest between the manner of deployment of its networth by the Asset Management Company and the interest of the Unitholders.

· The Trustee shall periodically review the investor complaints received and the redressal of the same by the Asset Management Company.

· The Trustee shall abide by the Code of Conduct as specified in the Fifth Schedule to the SEBI Regulations.

i. The Trustee shall be discerning in the appointment of the Directors on the Board of the Asset Management Company.

ii. Trustee shall review the desirability of continuance of the Asset Management Company if substantial irregularities are observed in any of the schemes and shall not allow the Asset Management Company to float new schemes.

iii. The Trustee shall ensure that the trust property is properly protected, held and administered by proper persons and by a proper number of such persons.

iv. The Trustee shall ensure that all service providers are holding appropriate registrations from SEBI or concerned regulatory authority.

vi. Trustees shall immediately report to SEBI of any special developments in the Mutual Fund.

i. obtain internal audit reports at regular intervals from independent auditors appointed by the Trustee.

ii. obtain compliance certificates at regular intervals from the Asset Management Company.

iv. consider the reports of the independent auditor and compliance reports of Asset Management Company at the meetings of Trustee for appropriate action.

v. maintain records of the decisions of the Trustee at their meetings and of the minutes of the meetings.

vi. prescribe and adhere to a code of ethics by the Trustee, Asset Management Company and its personnel.

vii. communicate in writing to the Asset Management Company of the deficiencies and checking on the rectification of deficiencies.

· The independent Directors of the Trustee or Asset Management Company shall pay specific attention to the following, as may be applicable, namely:

i. the Investment Management Agreement and the compensation paid under the agreement.

ii. service contracts with affiliates - whether the Asset Management Company has charged higher fees than outside contractors for the same services.

iv. securities transactions involving affiliates to the extent such transactions are permitted.

v. selecting and nominating individuals to fill independent Directors vacancies.

vi. code of ethics must be designed to prevent fraudulent, deceptive or manipulative practices by insiders in connection with personal securities transactions.

vii. the reasonableness of fees paid to Sponsor, Asset Management Company and any others for services provided.

· Notwithstanding anything contained in the SEBI Regulations 18 (1) to 18 (25), the Trustee shall not be held liable for acts done in good faith if they have exercised adequate due diligence honestly.

The supervisory role of the Trustee will be discharged by reviewing the information and the operations of the Mutual Fund based on the periodic reports submitted at the meetings of the Trustee and by reviewing the reports submitted by the Internal Auditor. The Trustee will also conduct a detailed review of annual accounts of the Scheme of the Mutual Fund. Presently the Board of Directors of Trustee is required to hold a meeting at least once in 2 calendar months and at least 6 such meetings are required to be held every year. During financial year 2006-2007 the Trustee had held 6 Board Meetings and during the current financial year the Trustee has held 4 Board Meeting till the date of this document.

The Board of Directors of the Trustee has constituted an Audit Committee, comprising 4 independent Directors and 2 Associate Directors of the Board of Directors of the Trustee, pursuant to the SEBI circular MFD/CIR/ 010/024/2000 dated January 17, 2000.

The Trustee may require or give verification of identity or other details regarding any subscription or related information from / of the Unitholders as may be required under any law, which may result in delay in dealing with the applications, Units, benefits, distribution, etc.

DIRECTORS OF THE TRUSTEE

The Board of Directors of ABN AMRO Trustee (

India

) Private Limited comprises of the following eminent persons:

THE ASSET MANAGEMENT COMPANY

ABN AMRO Asset Management (India) Limited is a company incorporated under the Companies Act, 1956, on November 4, 2003, having its registered office at 101, 10^th Floor, Sakhar Bhavan, Nariman Point, Mumbai 400 021. ABN AMRO Asset Management (India) Limited is appointed as the Investment Manager to the Mutual Fund vide the Investment Management Agreement dated April 15, 2004. Out of the paid-up equity share capital of the AMC of Rs. 30.36 crores, 75% is held by ABN AMRO Asset Management (Asia) Limited, 24.99% is held by Mr. J R Desai and the balance by resident individual shareholders. Mr. Desai is the Chairman of Tropicana Enterprises (P) Limited, a company which is into distributing & marketing of a range of electronic products. The details of ABN AMRO Asset Management (Asia) Limited, Sponsor is given on page ___.

SEBI approved the AMC to act as the Asset Management Company of the Mutual Fund vide its letter No IMD/YK/11091/2004 dated May 28, 2004.

The AMC will manage the Scheme of the Mutual Fund as mentioned in this Offer Document, in accordance with the provisions of the Investment Management Agreement, the Trust Deed, the SEBI Regulations and the objectives of the Scheme.

SEBI vide its letter no. IMD/SB/42486/2005 dated June 13, 2005 granted no-objection to the AMC for providing research and non-binding advisory services to ABN AMRO Asset Management (Asia) Limited - Hongkong, for their offshore India Equity Fund. The offshore India Equity Fund is a Sub-Fund of ABN AMRO Funds. ABN AMRO Funds is registered pursuant to Part I of the Luxembourg Law of 30 March 1988 on Undertakings for Collective Investment and qualifies as an Undertaking for Collective Investment in Transferable Securities under the Council Directive EC/85/611 for the marketing of its Shares in the Member States of the European Union. SEBI vide its letter no. IMD/FII/43187/2005 dated June 22, 2005 granted registration to the offshore India Equity Fund, as a sub-account of ABN AMRO Investment Funds S.A. (IN-LU-FA-0477-97), under SEBI (Foreign Institutional Investors) Regulations, 1995. The AMC w.e.f. August 1, 2005 renders research and non-binding advisory services to ABN AMRO Asset Management (Asia) Limited - Hongkong, for their offshore India Equity Fund and in rendering the said services, there is no conflict of interest with the activities of the Mutual Fund.

AMC has received an approval from SEBI vide SEBI’s letter no. IMD/SP/67987 dated May 29, 2006 for rendering services as Portfolio Manager under SEBI (Portfolio Managers) Rules and Regulations, 1993. Registration no. of AMC for Portfolio Management activities is INP000001728. The Trustees have submitted requisite certificate under Regulation 24(2) that the activities of Portfolio Management Services conducted by AMC are segregated & are not in conflict with the activities of the Mutual Fund. The AMC has commenced Portfolio Management Business w.e.f. September 26, 2006. Rendering the portfolio management services is not in conflict of interest with the activities of the Mutual Fund.

In accordance with the SEBI Regulations, an asset management company, subject to certain conditions, is also permitted to undertake activities in the nature of portfolio management services, management and advisory services to offshore funds, pension funds, provident funds, venture capital funds, management of insurance funds, financial consultancy and exchange of research on commercial basis and such other activities as may be permitted by SEBI from time to time. The AMC may undertake any or all of these activities after satisfying itself that there is no potential conflict of interest.

ASSET MANAGEMENT FEES

As per the Investment Management Agreement and the SEBI Regulations, the AMC is entitled to an Investment Management and Advisory fee at the rate of 1.25% per annum of the daily average net assets outstanding in each accounting year for the Scheme, as long as the net assets do not exceed Rs. 100 crore and 1.00% of the excess amount over Rs. 100 crore, where net assets so calculated exceed Rs. 100 crore.

Provided further, the AMC may charge such other Investment Management and Advisory Fee as SEBI may prescribe / permit from time to time.

DUTIES AND RESPONSIBILITIES OF THE ASSET MANAGEMENT COMPANY

The Duties and Responsibilities of the AMC shall be consistent with the SEBI Regulations and the Investment Management Agreement. The AMC shall discharge such duties and responsibilities as provided for under the SEBI Regulations and the Investment Management Agreement. The AMC shall, in the course of managing the affairs of the Mutual Fund, inter alia:

· Be responsible for formulating and floating one or more Schemes for the Mutual Fund after approval of the same by SEBI, the Trustee and managing the funds mobilised under various Schemes, in accordance with the provisions of the Trust Deed, investment guidelines if any laid down by the Trustee from time to time, the SEBI Regulations, the Offer Document of the Scheme, the investment objectives of each Scheme and the IMA. Further the AMC shall exercise due diligence and care in managing and / or taking all its investment decisions with respect to the funds mobilised under various Schemes as would be exercised by other persons engaged in the same business.

· Take all reasonable steps and exercise due diligence to ensure that the investment of funds pertaining to any scheme is not contrary to the provisions of the SEBI Regulations and the Trust Deed

· Provide or cause to be provided to the Trustee, reports on its performance of duties, as the Trustee may reasonably require, from time to time.

· Ensure that adequate instructions are issued to and duly complied with by the custodian, stock brokers, agents (including registrars and share transfer agents) for discharging its duties under the SEBI Regulations and / or the IMA.

· Provide information to SEBI and the Unitholders as required under the SEBI Regulations or as otherwise required by SEBI.

· Submit quarterly reports on March 31, June 30, September 30 and December 31 on the functioning of the Schemes of the Mutual Fund to the Trustee or at such intervals as may be required by the Trustee or SEBI.

· Maintain arms’ length relationship with other companies, or institutions or financial intermediaries or any body corporate with which it may be associated.

· Not appoint any person as key personnel who has been found guilty of any economic offence or involved in violation of securities laws.

· Be responsible for the acts of commissions or omissions by its employees or the persons whose services have been procured by the AMC.

· While utilising any services of or entering into any type of transactions with the Sponsor or any of the Sponsor’s and / or the AMC’s associates, employees or their relatives, ensure that the same are permitted under the SEBI Regulations or by SEBI. If utilisation of such services or entering into such transactions are permitted, then the AMC shall ensure that the same are carried out in accordance with the manner provided under the SEBI Regulations or by SEBI and shall report on the same to the Trustee and / or SEBI where necessary or required under the SEBI Regulations.

· Ensure that it does not give any undue or unfair advantage to any associates or deals with any of the associates of the AMC in any manner detrimental to the interest of the Unitholders.

· Notwithstanding anything contained in any contract or agreement or termination, the AMC or its Directors or other officers shall not be absolved of liability to the Mutual Fund for their acts of commission or omissions, while holding such position or office.

· Keep or cause to be kept on behalf of the Mutual Fund at the AMC’s head office, and at such other places as may be required under any law or by the Trustee, such books, records and statements expressed in such currencies as may be necessary to give a proper and complete record of all transactions carried out by the AMC for or on behalf of the Mutual Fund and such other books, records and statements as may be required by any law or the Trustee and shall permit the employees, authorised agents and auditors of the Trustee, to inspect such books, records, and statements at all reasonable times and on request of the Trustee, furnish true copies thereof.

· Not acquire any of the assets out of the scheme property which involves the assumption of any liability which is unlimited or which may result in encumbrance of the scheme property in any way.

· Abide by the Code of Conduct as specified in the Fifth Schedule to the SEBI Regulations.

° not undertake any other business activities except activities in the nature of portfolio management services, management and advisory services to offshore funds, pension funds, provident funds, venture capital funds, management of insurance funds, financial consultancy and exchange of research on commercial basis if any of such activities are not in conflict with the activities of the Mutual Fund.

Provided that the AMC may itself or through its subsidiaries undertake such activities if it satisfies SEBI that the key personnel of the AMC, the systems, back office, bank and securities accounts are segregated activity wise and there exist systems to prohibit access to inside information of various activities.

Provided further that the AMC shall meet capital adequacy requirements, if any, separately for each such activity and obtain separate approval, if necessary under the relevant regulations.

· The Chief Executive Officer (whatever his designation may be) of the asset management company shall ensure that the mutual fund complies with all the provisions of these regulations and the guidelines or circulars issued in relation thereto from time to time and that the investments made by the fund managers are in the interest of the unitholders and shall also be responsible for the overall risk management function of the mutual fund.

Explanation: For the purpose of this sub-regulation, the words ‘these regulations’ shall mean and include the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 as amended from time to time. (MFD/CIR.No 04/11488 /2003, dated 12 June 2003).

· An asset management company shall not through any broker associated with the sponsor, purchase or sell securities, which is average of 5% or more of the aggregate purchases and sale of securities made by the mutual fund in all its schemes.

Provided that for the purpose of this sub-regulation, aggregate purchase and sale of securities shall exclude sale and distribution of units issued by the mutual fund.

Provided further that the aforesaid limit of 5% shall apply for a block of any three months.

An asset management company shall not purchase or sell securities through any broker [other than a broker referred to in clause (a) of sub-regulation (7)] which is average of 5% or more of the aggregate purchases and sale of securities made by the mutual fund in all its schemes, unless the asset management company has recorded in writing the justification for exceeding the limit of 5% and reports of all such investments are sent to the trustees on a quarterly basis.

· In case any company has invested more than 5 per cent of the net asset value of a scheme, the investment made by that scheme or by any other scheme of the same mutual fund in that company or its subsidiaries shall be brought to the notice of the trustees by the asset management company and be disclosed in the half yearly and annual accounts of the respective schemes with justification for such investment [provided the latter investment has been made within one year of the date of the former investment calculated on either side.]

(a) detailed bio-data of all its directors alongwith their interest in other companies within fifteen days of their appointment; and

(c) a quarterly report to the trustees giving details and adequate justification about the purchase and sale of the securities of the group companies of the sponsor or the asset management company as the case may be, by the mutual fund during the said quarter.

Each director of the Asset Management Company shall file the details of his transactions of dealing in securities with the trustees on a quarterly basis in accordance with guidelines issued by the Board." (MFD/CIR/9/230/2001 DATED AUGUST 14, 2001)

DIRECTORS OF THE AMC

The Board of Directors of the ABN AMRO Asset Management (

India

) Limited comprises of the following eminent persons:

KEY PERSONNEL OF THE AMC AND RELEVANT EXPERIENCE

Presently the AMC has one dedicated portfolio analyst for debt segment and a total of eight employees (including analysts) in the investment management department. Presently all the key personnel are based at the registered office of the AMC.

For experience and qualification of Fund Managers please see the table of Key Personnel above.

INVESTOR RELATIONS OFFICER

STATUTORY AUDITORS FOR THE MUTUAL FUND

CUSTODIAN & FUND ACCOUNTANT

Deutsche Bank A G, has been appointed as Custodian and Fund Accountant for the Scheme. The Custodian has been registered with SEBI under registration no.: IN/CUS/03. The Trustee and the AMC have entered into a Custodian Agreement with the Custodian and the salient features of the said Agreement include obligations of the Custodian to:

(b) Collect and receive any income and other payments and distribution made by the issuer of securities.

(e) Be responsible for the loss or damage to the assets belonging to the Scheme due to negligence on its part or on the part of its approved agents.

(g) The Custodian shall not assign, transfer or lend the property held by it on behalf of the Mutual Fund except with the prior written permission of the AMC.

The Custodian will be entitled to remuneration for its services in accordance with the terms of the Custodian Agreement. The Trustee has the right to change the Custodian.

Deutsche Bank A G, Mumbai also provides fund accounting, NAV calculation and other related services. The Fund Accountant is entitled to remuneration for its services in accordance with the terms of the Fund Accounting Agreement. The AMC have the right to change the Fund Accountant, if necessary.

REGISTRAR AND TRANSFER AGENT

Computer Age Management Services (P) Limited, A&B, Lakshmi Bhawan, 609, Anna Salai, Chennai - 600 006 (CAMS) has been appointed as Registrar and Transfer Agent for the Scheme. The Registrar and Transfer Agent is registered with SEBI under registration number INR000002813. As Registrar and Transfer Agent to the Scheme, CAMS will handle all back office transaction processing activities. The AMC and the Trustee have satisfied themselves that the Registrar and Transfer Agent has adequate capacity to discharge responsibilities with regard to processing of applications and despatching Unit certificates to Unitholders within the time limit prescribed in the SEBI Regulations and also has sufficient capacity to handle investor complaints.

The Registrar and Transfer Agent will be entitled to remuneration for its services in accordance with the terms of the Registrar and Transfer Agent Agreement(s).

COLLECTING BANKERS

The Collecting Banker to the New Fund Offer is ABN AMRO Bank N.V (SEBI Registration No. INBI00000034)

Application for the New Fund Offer / Continuous Offer will be accepted at the Collection centres / ISCs as may be designated by the AMC from time to time. The AMC may from time to time appoint such other banks registered with SEBI as collecting bankers.

SECTION II

INVESTMENT OBJECTIVE & POLICY

TYPE OF SCHEME

ABN AMRO China Equity Fund is an Open Ended Equity Scheme investing in Chinese Equities

INVESTMENT OBJECTIVE

To provide long term capital appreciation by investing primarily in Chinese equity and equity related instruments. The fund may also invest a limited proportion in debt and money market instruments. In addition, the fund may invest a portion of the net assets in Indian securities.

However, there can be no assurance that the investment objective of the Scheme will be realized. The Scheme/ Plans launched there under do not guarantee/indicate any returns.

The Scheme offers Regular Plan and Institutional Plan. The said Plans offer Growth Option and Dividend Option. The Dividend Option offers Dividend Payout and Dividend Re-investment facilities.

INVESTMENT PATTERN

Under normal circumstances, the asset allocation under the Scheme would be as follows:

$ Exposure to Equity Derivatives could be upto 100% of the net assets. Exposure to overseas derivatives traded on recognised stock exchanges (overseas) will be only for hedging and portfolio balancing with underlying securities.

The Scheme may take exposure to Debt and currency derivatives within limits permissible by SEBI & RBI.

The exposure of the Scheme to the Foreign Securities could be up to 100% of the net assets of the Scheme.

Investments in foreign securities shall always be as per the Policy for Offshore Investments provided in this Offer Document.

It may be noted that asset allocation limit will be subjected to available investment limit in foreign securities and hence the Fund Manager may be constrained to invest the balance portion in Indian Securities till AMC obtains SEBI approval for upward revision of limit applicable for Foreign Securities investment. In such situations, till SEBI approval is obtained, changes to the above asset allocation will not be considered as change in Fundamental attributes of the Scheme.

Investors may note that securities, which provide higher returns, typically display higher volatility. Accordingly, the investment portfolio of the Scheme would reflect moderate to high volatility in its equity and equity related investments and low to moderate volatility in its debt and money market investments.

For investments in ADRs / GDRs, the Fund Manager would consider the premium / discount to the underlying stock and the possibility of the discount narrowing or the premium expanding, liquidity management of the portfolio, secondary and primary offerings of ADRs / GDRs.

The Scheme may review the above pattern of investments based on views on the equity and debt markets and liquidity needs and the portfolio shall be reviewed and rebalanced on a regular basis. However, at all times the portfolio will adhere to the overall investment objective of the Scheme.

The AMC may review the above investment pattern based on its views on the equity markets and liquidity or liability needs.

Pending deployment of funds of the Scheme in securities in terms of investment objective of the the Scheme, the Mutual Fund may invest the funds of the Scheme in short term deposits of scheduled commercial banks subject to restrictions laid down by the SEBI Regulations from time to time (refer Investment Restriction on page no.__). Investments in short term deposits will be in compliance with SEBI Circular on short term deposits dated April 16, 2007 reference number SEBI/IMD/CIR No. 1/ 91171 /07.

The AMC retains the option to alter the asset allocation depending on liquidity considerations or on account of high levels of subscriptions or redemptions relative to the fund size, or upon considerations that optimise returns of the Scheme through investment opportunities or upon various defensive considerations including market conditions, market opportunities, applicable regulations and political and economic factors.

INVESTMENT STRATEGY

ABN AMRO China Equity Fund may invest in the equity and equity related securities through direct investment in equity and equity related instruments as permitted by SEBI.

The Scheme can also invest in various Indian fixed income securities. The Scheme can actively move its assets between equity and fixed income securities depending on its view on these markets. The fund may invest upto 100% of its corpus in Chinese equity securities, upto 35% in Indian Equity and Equity Related Securities and/or upto 35% of it corpus in debt securities and money market instruments in

India

and abroad.

· Initial and follow on public offerings for listing at recognized stock exchanges overseas

· Foreign debt securities in the countries with fully convertible currencies, short term as well as long term debt instruments with rating not below investment grade by accredited/registered credit rating agencies

· Repos in the form of investment, where the counterparty is rated not below investment grade; repos should not however, involve any borrowing of funds by mutual funds

· Government securities where the countries are rated not below investment grade

· Derivatives traded on recognized stock exchanges overseas only for hedging and portfolio balancing with underlying as securities

· Short term deposits with banks overseas where the issuer is rated not below investment grade

· Units/securities issued by overseas mutual funds or unit trusts registered with overseas regulators and investing in (a) aforesaid securities, (b) Real Estate Investment Trusts (REITs) listed in recognized stock exchanges overseas or (c) unlisted overseas securities (not exceeding 10% of their net assets).

· Equity and equity related securities including convertible bonds and debentures and warrants carrying the right to obtain equity shares.

· Securities issued / guaranteed by the Central, State and local governments (including but not limited to coupon bearing bonds, zero coupon bonds and treasury bills).

· Debt obligations of domestic government agencies and statutory bodies, which may or may not carry a Central / State Government guarantee.

· Debt obligations of banks (both public and private sector) and financial institutions.

· Money market instruments as may be permitted by SEBI / RBI from time to time including Certificate of Deposits (CDs), Commercial Papers (CPs), Bills of Exchange / Promissory Notes, Collateralised Lending and Borrowing Obligations (CBLO), Reverse repurchase obligations (reverse repo) in securities.

· Deposits (including Overnight Deposits) with Banks in

India

and abroad subject to applicable regulations

· Securitised Debt and Pass through, Pay through or other Participation Certificates representing interest in a pool of assets including receivables.

· Any other instruments as may be permitted by SEBI / RBI/ other Regulatory Authority from time to time.

The Indian securities mentioned above could be listed, unlisted, privately placed, secured, unsecured, rated or unrated and of any maturity.

The securities may be acquired through Initial Public Offerings (IPOs), secondary market operations and private placement, rights offers or negotiated deals.

CHANGE IN INVESTMENT PATTERN

Subject to the SEBI Regulations, the asset allocation pattern indicated above may change from time to time, depending on liquidity considerations or on account of high levels of repurchase or redemptions relative to fund size, or upon considerations that optimise returns of the Scheme through investment opportunities or upon various defensive considerations including market conditions, market opportunities, applicable regulations and political and economic factors. It must be clearly understood that the percentages stated above are only indicative and not absolute. These proportions may vary substantially depending upon the perception of the AMC, the intention being at all times to seek to protect the interests of the Unitholders. Such changes in the investment pattern will be for short term and only for defensive considerations.

TERMS OF THE PLANS OFFERED UNDER THE SCHEME

(a) Liquidity

The Scheme will offer for Sale and Redemption the Units on every Business Day on an ongoing basis, commencing not later than 30 days from the closure of New Fund Offer Period.

Accordingly, the Units can be redeemed (i.e. sold back to the Mutual Fund) on or Switched out (i.e. to another scheme of the Mutual Fund or Option(s) offered within the Scheme, if any) every Business Day, at the Applicable NAV subject to applicable Load, if any.

In case an investor has purchased Units on more than one Business Day (either under the New Fund Offer Period or through subsequent purchases) the Units purchased first (i.e. those Units which have been held for the longest period of time), will be deemed to have been redeemed first i.e. on a First-in-First-Out basis.

It may, however, be noted that in the event of death of the Unitholder, the nominee/legal heir (as the case may be), subject to production of requisite documentary evidence, will be able to redeem the investment.

The Redemption / Switch out will be at NAV based prices subject to a Load, if any. Please refer to "Redemption Price" on page __ and "Load structure" on page __.

As per the SEBI Regulations, the Mutual Fund shall despatch Redemption proceeds within 10 Business Days from the date of acceptance of the Redemption request. However, under normal circumstances, the Mutual Fund will endeavour to despatch the Redemption proceeds within 4 Business Days from the date of acceptance of the Redemption request.

Please refer to "Right to Limit / Withhold Redemptions" on page __ and "Suspension of Sale / Redemption / Switching Option(s) of the Units" on page __.

Being Open-Ended Scheme under which Sale and Redemption of Units will be made on continuous basis by the Mutual Fund, the Units of the Scheme are not proposed to be listed on any stock exchange. However, the AMC / Trustee may at their sole discretion list the Units under any of the Scheme on one or more stock exchanges at a later date.

In accordance with the guidelines issued by SEBI, ABN AMRO China Equity Fund, being an open-ended Scheme would meet the sales, marketing and other such expenses connected with Sales and distribution of the Scheme from the entry load, if any and not through initial issue expenses.

The details of the initial issue expenses of the Scheme have been stated under section titled “Initial Issue Expenses” on page ___.

The details of recurring expenses of the Scheme, on an annual basis, have been stated under section titled “Annual Scheme Recurring Expenses” on page ___.

As per the SEBI Regulations, the maximum recurring expenses including the investment management and advisory fee that can be charged to the Scheme shall be subject to a percentage limit of average daily net assets as in the table below:

Subject to the SEBI Regulations and this Offer Document, expenses over and above the prescribed ceiling shall be borne by the AMC.

Exit load: 1% if redeemed / switched out within 6 months from date of investment.

It may be noted that no load will be charged in case of switches between equity Schemes of ABN AMRO Mutual Fund. No entry/exit load will be charged in case of investment made by Fund-of- Funds Schemes launched by Mutual Funds in ABN AMRO China Equity Fund.

The load structure is subject to change from time to time and such changes shall be implemented prospectively.

The Mutual Fund shall ensure that the Redemption Price is not lower than 93% of the NAV and the Sale Price is not higher than 107% of the NAV, provided that the difference between the Redemption Price and Sale Price of the Unit shall not exceed the permissible limit of 7% of the Sale Price, as provided for under the SEBI Regulations.

For Units purchased during the New Fund Offer Period and after the closure of the New Fund Offer Period, please refer to the section titled "Load Structure & Recurring Expenses" on page ___ for further details. The Trustee / AMC has a right to impose or modify the Load structure with prospective effect and to introduce an Entry and / or Exit Load and / or any other Load or a combination thereof, subject to the maximum limits as prescribed under the SEBI Regulations.

CHANGES IN FUNDAMENTAL ATTRIBUTES

Subject to Regulation 18(15A), the Trustee shall ensure that no change in the fundamental attributes of the Scheme or the trust or fees and expenses payable or any other change which would modify the Scheme and affect the interest of Unitholders, shall be carried out unless:

· a written communication about the proposed change is sent to each Unitholder and an advertisement is given in one English daily newspaper having nation-wide circulation as well as in a newspaper published in the language of the region where the Head Office of the Mutual Fund is situated; and

· the Unitholders are given an option to exit at the prevailing Net Asset Value without any Exit Load.

Explanation: In terms of the SEBI Regulations and circular dated February 4, 1998, “Fundamental Attributes” referred above shall mean:

· Equity Fund investing predominantly in equity and equity related securities of Chinese marketwith no assured returns.

· Investment pattern – As stated earlier, tentative asset allocation equity/debt/money market instruments with minimum and maximum asset allocation, while retaining the option to alter the asset allocation for a short term period on defensive considerations.

· As stated earlier, liquidity provisions such as listing, repurchase, redemption

BENCHMARK INDEX

The Benchmark Index for the Scheme is FTSE

China

International Index.

The index is published in HKD and will be converted to INR for comparison with the fund.

The Board of Trustee/ AMC may review the benchmark selection process from time to time, and make suitable changes as to use of the benchmark, or related to composition of the benchmark, whenever it deems necessary

Performance comparisons for the Scheme will be made vis-à-vis the respective Benchmark. However, the Scheme’s performance may not be strictly comparable with the performance of the respective Benchmarks due to the inherent differences in the construction of the portfolios. The Trustee / AMC reserve the right to change the Benchmarks for evaluation of performance of the Scheme from time to time in conformity with the investment objectives and appropriateness of the Benchmarks subject to the SEBI Regulations, and other prevailing guidelines, if any.

INVESTMENT APPROACH & RISK CONTROL

ABN AMRO China Equity Fund may invest directly in Chinese equity and equity related securities as permitted by SEBI.

The Fund seeks to genetrate high total return from an actively managed portfolio of Transferable Equities of companies that are domiciled in, or derive a significant part of their revenues or profits or have a significant part of their assets in

China

The Fund's Investment Manager looks for companies that may benefit from the anticipated high long-term growth of the Chinese economy. It examines individual securities, basing buy and sell decisions on such factors as a company's financial strength, competitive position, profitability, growth prospects and quality of management. In setting allocations and choosing securities, the Investment Manager aims to gain broad exposure to different industries and companies, in order to reduce risk, while also favoring those investments that appear more attractive in terms of growth potential. Direct investments in Chinese & Indian companies may involve specific risks.

The fund is diversified, actively managed fund and invests in equities of the fast growing Chinese economy by using top down/bottom up approaches in capturing stock opportunity.

· Investing in Chinese equities allows you to participate in the growth in one of the fastest growing major economies of the world.

· Chinese equities allows you to take advantage of the superior growth of fast emerging economies in the world driven by structural change and reforms, enormous consumption growth led by positive demographics.

· Investing in buoyancy of

China

’s equity markets despite the government’s continuing efforts to control the abundant liquidity.

· Investing in a country which is a major player in global manufacturing and infrastructure.

· Besides participation in a fast growing emerging market, investment in Chinese equity brings the added benefit of reducing risks through diversification.

All investments involve risks; there is no assurance that the Fund will achieve its investment objective. The value of the Fund's NAV will go up and down and you could incur significant losses, especially in the short term. Below are some of the factors that could negatively affect the Fund's performance:

· Emerging Markets Risk: Market risks can be greater in certain countries in particular those with such characteristics as political instability, lack of complete or reliable information, market irregularities or high taxation.

· Equity market Risks Prices of equities fluctuate daily and can be influenced by many factors, such as political and economic news, corporate earnings reports, demographic trends and catastrophic events.

· Exchange Rate Risk: The investments in overseas securities are subjected to risks due to foreign currency movements and foreign currency crises due to stronger correlation between currency movements of emerging countries’ currencies. Currently the fund is not permitted by regulations to hedge the currency risk. However if future regulations permit currency hedges, the fund manager may choose to hedge currency risk in the fund.

ABN AMRO China Equity Fund may invest directly in Chinese equity related securities and balance in Indian securities as permitted by SEBI.

The investment philosophy in case of Chinese Instruments is based on the following beliefs:

o Investing predominantly in Chinese equities allows you to participate in economy having growing importance in Global GDP.

o Investing in Chinese equities allows you to take advantage of the superior growth of fast emerging economy in the world driven by structural change and reforms, enormous consumption growth led by positive demographics.

o Investing in buoyancy of

China

’s equity markets despite the government’s continuing efforts to control the countries’ abundant liquidity.

o Investing in country, which is major player in global manufacturing and services.

o Besides, participation in markets of fast growing emerging economies with added benefit of reducing local risks through diversification.

o Formulating a discipline by paying a reasonable price for a quality company via price target/sector allocation.

The Scheme may invest in another scheme managed by the AMC or in the schemes of any other mutual funds, provided it is in conformity with the investment objectives of the Scheme and in terms of the prevailing the SEBI Regulations. As per the SEBI Regulations, no investment management fees will be charged for such investments and the aggregate inter scheme investment made by all schemes in the schemes of the Mutual Fund or in the schemes under the management of any other asset Management Company shall not exceed 5% of the net asset value of the Mutual Fund. However such restriction is not applicable to investment in mutual funds in foreign countries made in accordance with SEBI circulars/guidelines issued in this regard from time to time.

TRADING IN DERIVATIVES

The Scheme intends to use derivatives for the purposes, that may be permitted by SEBI Mutual Fund Regulations from time to time. SEBI has vide its Circular SEBI/MFD/CIR No.03/158/03 dated June 10, 2003, Circular DNDP/CIR-29/2005 dated September 14, 2005, Circular DNDP/CIR-30/2006 dated January 20, 2006 & Circular DNDP/CIR-31/2006 dated September 22, 2006 specified the guidelines pertaining to trading by Mutual Fund in Exchange Traded Derivatives. Accordingly, the Scheme may use derivative instruments viz. Interest Rate Swaps, Forward Rate Agreements, Equity Index Options or such other derivative instruments as may be introduced from time to time as permitted under the SEBI Regulations and guidelines.

The following information provides a basic idea as to the objective & nature of the derivative instruments proposed to be used by the Fund and the benefits and risks attached therewith.

Bond markets in

India

are not very liquid. Investors run the risk of illiquidity in such markets. Investing for short-term periods for liquidity purposes has its own risks. Investors can benefit if the Fund remains in call market for the liquidity and at the same time take advantage of fixed rate by entering into a swap. It adds certainty to the returns without sacrificing liquidity.

All swaps are financial contracts, which involve exchange (swap) of a set of payments owned by one party for another set of payments owned by another party, usually through an intermediary (market maker). An IRS can be defined as a contract between two parties (Counter Parties) to exchange, on particular dates in the future, one series of cash flows, (fixed interest) for another series of cashflows (variable or floating interest) in the same currency and on the same principal for an agreed period of time. The exchange of cash flows need not occur on the same date.

A FRA is an agreement between two counter parties to pay or to receive the difference between an agreed fixed rate (the FRA rate) and the interest rate prevailing on a stipulated future date, based on a notional amount, for an agreed period. In short, in a FRA, interest rate is fixed now for a future period. The special feature of FRAs is that the only payment is the difference between the FRA rate and the Reference rate and hence are single settlement contracts. As in the case of IRS, notional amounts are not exchanged.

The Scheme will use derivative instruments for the purpose of hedging and portfolio balancing. Hedging does not mean maximisation of returns but only reduction of systematic or market risk inherent in the investment.

Assume that the Scheme has a Rs. 20 crore floating rate investment linked to MIBOR (Mumbai Inter Bank Offered Rate). Hence, the Scheme is currently running an interest rate risk and stands to lose if the interest rate moves down. To hedge this interest rate risk, the Scheme can enter into a 6 month MIBOR swap. Through this swap, the Scheme will receive a fixed predetermined rate (assume 12%) and pays the "benchmark rate" (MIBOR), which is fixed by the National Stock Exchange of India Limited (NSE) or any other agency such as Reuters. This swap would effectively lock-in the rate of 12% for the next 6 months, eliminating the daily interest rate risk. This usually is routed through an intermediary who runs a book and matches deals between various counterparties.

· Assuming the swap is for Rs. 20 crore June 1, 2006 to December 1, 2006. The Scheme is a fixed rate receiver at 12% and the counterparty is a floating rate receiver at the overnight rate on a compounded basis (say NSE MIBOR).

· On June 1, 2006 the Scheme and the counterparty will exchange only a contract of having entered this swap. This documentation would be as per International Swap Dealers Association (ISDA).

° The Scheme is entitled to receive interest on Rs. 20 crore at 12% for 184 days i.e. Rs.1.21 crore, (this amount is known at the time the swap was concluded) and will pay the compounded benchmark rate.

° The counterparty is entitled to receive daily compounded call rate for 184 days and pay 12% fixed.

° On December 1, 2006, if the total interest on the daily overnight compounded benchmark rate is higher than Rs. 1.21 crore, the Scheme will pay the difference to the counterparty. If the daily compounded benchmark rate is lower, then the counterparty will pay the Scheme the difference.

° Effectively the Scheme earns interest at the rate of 12% p.a. for six months without lending money for 6 months fixed, while the counterparty pays interest @ 12% p.a. for 6 months on Rs. 20 crore, without borrowing for 6 months fixed.

The above example illustrates the benefits and risks of using derivatives for hedging and optimizing the investment portfolio. Swaps have their own drawbacks like credit risk, settlement risk. However, these risks are substantially reduced as the amount involved is interest streams and not principal.

The Scheme may use index options, or any other similar derivative instruments that are permissible or may be permissible in future under applicable regulations, as would be commensurate with the investment objective of the Scheme, in an attempt to protect the value of the portfolio and enhance Unitholders interest.

The fund manager will employ a combination of the following strategies apart from investments in equity and equity related instruments.

Theoretically, therefore, the pricing of Nifty Index futures should be equal to the pricing of the synthetic index created by futures on the underlying stocks. However, due to market imperfections, the index futures may not exactly correspond to the synthetic index futures. The Nifty Index futures normally trades at a discount to the synthetic Index due to large volumes of stock hedging being done using the Nifty Index futures giving rise to arbitrage opportunities.

The fund manager shall aim to capture such arbitrage opportunities by taking long positions in the Nifty Index futures and short positions in the synthetic index. The strategy is attractive if this price differential (post all costs) is higher than the investor’s cost-of-capital.

The Plans under the scheme would look for market opportunities between the spot and the futures market. The cash futures arbitrage strategy can be employed when the price of the futures exceeds the price of the underlying stock.

The Plans will first buy the stocks in cash market and then sell in the futures market to lock the spread known as arbitrage return.

Buying the stock in cash market and selling the futures results into a hedge where the Plans have locked in a spread and is not affected by the price movement of cash market and futures market The arbitrage position can be continued till expiry of the future contracts. The future contracts are settled based on the last half an hour’s weighted average trade of the cash market. Thus there is a convergence between the cash market and the futures market on expiry. This convergence helps the Plans under the Scheme to generate the arbitrage return locked in earlier. However, the position could even be closed earlier in case the price differential is realized before expiry or better opportunities are available in other stocks The strategy is attractive if this price differential (post all costs) is higher than the investor’s cost-of-capital.

The objective of the strategy is to generate alpha by superior stock selection and removing market risks by hedging with appropriate index.

The following section describes some of the more common equity derivatives transactions along with their benefits:

The Stock Index futures are instruments designed to give exposure to the equity markets indices. The Stock Exchange, Mumbai (BSE) and The National Stock Exchange (NSE) have recently started trading in index futures of 1, 2 and 3 month maturities. The pricing of an index future is the function of the underlying index and short term interest rates.

Say, Fund buys 1,000 futures contracts, each contract value is 200 times futures index price

Assuming the exchange imposes total margin of 10%, the Investment Manager will be required to provide total margin of approx. Rs.40, 200,000 (i.e.10% * 2010 * 1000 * 200) through eligible securities and cash.

Please note that the above example is given for illustration purposes only. Some

The net impact for the Fund will be in terms of the difference of the closing price of the index and cost price. Thus, it is clear from the example that the profit or loss for the Fund will be the difference of the closing price (which can be higher or lower than the purchase price) and the purchase price. The risks associated with index futures are similar to those associated with equity investments. Additional risks could be on account of illiquidity and potential mis–pricing of the futures.

An option gives a person the right but does not cast the obligation to buy or sell something. An option is a contract between two parties wherein the buyer receives a privilege for which he pays a fee (premium) and the seller accepts an obligation for which he receives a fee. The premium is the price negotiated and set when the option is bought or sold. A person who buys an option is said to be long in the option. A person who sells (or writes) an option is said to be short in the option.

87. In

India

, National Stock Exchange (NSE) became the first exchange to launch trading in options on individual securities. Trading in options on individual securities commenced from July 2, 2001. Option contracts are American style and cash settled and are currently available on 52 securities (as on February 14, 2005) as stipulated by the Securities and Exchange Board of India (SEBI).

Say, the Fund purchases on February 7, 2005, 1 month Put Options on XYZ Ltd. (XYZ) on the NSE i.e. put options on 5000 shares (50 contracts of 100 shares each) of XYZ Ltd.

As these are American style options, they can be exercised on or before the exercise date i.e. February 24, 2005. If the share price of XYZ Ltd. falls to Rs.5,500 on February 14, 2005 and the Investment Manager decides to exercise the option, the net impact will be as follows:

In the above example, the Investment Manager hedged the market risk on 5000 shares of XYZ Ltd. by purchasing Put Options.

Please note that the above example is given for illustration purposes only. Some assumptions have been made for the sake of simplicity. Certain factors like margins have been ignored. The purchase of Put Options does not increase the market risk in the fund as the risk is already in the fund's portfolio on account of the underlying asset position (in this example XYZ Ltd. shares). The premium paid for the option is treated as an expense and added to the holding cost of the relevant security. Additional risks could be on account of illiquidity and potential mis–pricing of the options.

Valuation of Derivative Products

· The traded derivatives shall be valued at market price in conformity with the stipulations of sub clauses (i) to (v) of clause 1 of the Eighth Schedule to the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996, as amended from time to time.

· The valuation of untraded derivatives shall be done in accordance with the valuation method for untraded investments prescribed in sub clauses (i) and (ii) of clause 2 of the Eighth Schedule to the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 as amended from time to time.

POLICY ON OFFSHORE INVESTMENTS BY THE SCHEME

As per circular SEBI/IMD/CIR No.7/104753/07 dated September 26, 2007 issued by SEBI , the Scheme with the approval of SEBI may invest in:

· Initial and follow on public offerings for listing at recognized stock exchanges overseas

· Repos in the form of investment, where the counterparty is rated not below investment grade; repos should not however, involve any borrowing of funds by mutual funds

· Government securities where the countries are rated not below investment grade

· Derivatives traded on recognized stock exchanges overseas only for hedging and portfolio balancing with underlying as securities

· Short term deposits with banks overseas where the issuer is rated not below investment grade

The investment by individual Mutual Fund in the above securities is subject to a maximum of US $300 million in the above securities.

With respect to Overseas Exchange Traded Funds (ETFs), individual Mutual Fund investment is subject to a maximum of US $ 50 million per mutual fund.

Presently, we have obtained approval from SEBI for investments in Foreign Securities and Overseas ETFs vide SEBI letter dated December 8, 2006. In accordance with the above circular, our overall present limits as a Mutual Fund are as under

The Sponsors of ABN AMRO Mutual Fund i.e. AAAM Asia specializes in the Asian markets for both investment funds' advisory and discretionary mandates. It also promotes ABN AMRO's global products in the Asian region to both institutional investors and private clients. AAAM Asia is the Asian asset management centre for ABN AMRO's global asset management business, hence, have adequate experience of investing in foreign securities.

The AMC may appoint AAAM Asia / other financial advisors/ service providers for providing advisory services/ any other kind of services with respect to investments in foreign securities from time to time.

The Fund has appointed a dedicated Fund Manager for making investments in foreign securities & Overseas Exchange Traded Funds.

Subject to the approval of the RBI / SEBI and conditions as may be prescribed by them, the Mutual Fund may open one or more foreign currency accounts abroad either directly, or through the custodian/sub-custodian, to facilitate investments and to enter into/deal in forward currency contracts, currency futures, interest rate futures/swaps, currency options for the purpose of hedging the risks of assets of a portfolio or for its efficient management.

Investing in Foreign Securities allows the investor to move away from a single country, single currency and single market format.

The Foreign markets allow investors access to a choice of investment avenues / instruments. These markets are also typically more liquid than domestic markets.

The Mutual Fund may, where necessary appoint intermediaries as sub-managers, sub-custodians, etc. for managing and administering such investments. The appointment of such intermediaries shall be in accordance with the applicable requirements of SEBI and within the permissible ceilings of expenses.

INVESTMENT DECISIONS

The Board of Directors of the AMC has constituted an Investment Committee of the AMC. This Committee will clearly lay down the various policies and processes covering Investments for the Scheme in light of the SEBI Regulations and will oversee implementation of the investment process.

The Fund has appointed a dedicated Fund Manager for making investments in overseas securities and also has entered into advisory agreement with ABN AMRO Asset Management (Asia) Limited. The ABN AMRO Asset Management (Asia) Limited will advise on portfolio-construction and securities selection to AMC (dedicated Fund Manager). Under this arrangement, there is no transfer of funds to the ABN AMRO Asset Management (Asia) Limited and the securities will always be retained under the ownership of the Scheme. The Fund Managers will continuously monitor all investment decisions and its impact on the performance of the Scheme and carry out suitable adjustment at periodic intervals. The Managing Director is also a member of the Investment Committee.

The Investment Committee will periodically review the performance of the Scheme and general market outlook. The Investment Committee will report to the Board of Directors of the AMC.

Periodic presentations will be made to the Board of Directors of the AMC and Trustee Company to review and monitor the performance of the Scheme against the Benchmark chosen for the Scheme.

The Fund Manager shall ensure that the funds of the Scheme are invested to achieve the investment objectives of the Scheme and in the interest of the Unitholders. All investment decisions shall be recorded

PORTFOLIO TURNOVER

Portfolio turnover is defined as lesser of purchases or sales as a percentage of the average corpus of the Scheme during a specified period of time. The Scheme being an open-ended Scheme, it is expected that there would be a number of subscriptions and redemptions on a daily basis. Consequently, it is difficult to estimate with any reasonable measure of accuracy, the likely turnover in the portfolio(s). Active asset allocation would impact portfolio turnover.

Pursuant to the SEBI Regulations the cost of investments acquired or purchased shall include brokerage, stamp charges and any charge customarily included in the broker's bought note.

INVESTMENT RESTRICTIONS

· A Scheme of the Mutual Fund shall not invest more than 10 percent of its NAV in equity shares or equity related instruments of any company and in listed securities / units of Venture Capital Funds.

· A Scheme shall not invest more than permissible limit in the unlisted equity shares or equity related instruments and in unlisted securities. Presently, such investments can be made upto 5% of its NAV in Indian Equities and no such investments are allowed in foreign unlisted equity securities .

· A Scheme shall not invest more that 15% of its NAV in debt instruments [irrespective of residual maturity period (above or below one year)], issued by a single issuer which are rated not below investment grade by a credit rating agency authorised to carry out such activity under the SEBI Act. Such investment limit may be extended to 20% of the NAV of the Scheme with the prior approval of the Trustee and the Board of the AMC/Committee constituted for this purpose.

Provided that such limit shall not be applicable for investments in Government Securities and money market instruments.

Provided further that investment within such limit can be made in mortgaged backed securitised debt which are rated not below investment grade by a credit rating agency registered with SEBI.

· A Scheme shall not invest more than 10% of its NAV in unrated debt instruments [irrespective of residual maturity period (above or below one year)], issued by a single issuer and the total investment in such instruments shall not exceed 25% of the NAV of the Scheme. All such investments shall be made with the prior approval of the Trustee and the Board of the AMC or a Committee constituted in this behalf.

· The above investment limits are applicable to all debt securities which are issued by public bodies / institutions such as electricity boards, municipal corporations, state transport corporations, etc., guaranteed by either the state or central government.

· The Mutual Fund under all its Scheme shall not own more than ten percent of any Company's paid up capital carrying voting rights.

· Transfer of investments from one Scheme to another Scheme in the same Mutual Fund, shall be allowed only if:-

° such transfers are done at the prevailing market price for quoted Securities on spot basis

Explanation : spot basis shall have the same meaning as specified by Stock Exchange for spot transactions

° the Securities so transferred shall be in conformity with the investment objective of the Scheme to which such transfer has been made.

· A Scheme may invest in another scheme under the same asset management company or any other mutual fund without charging any fees, provided that aggregate inter-scheme investment made by all schemes under the same asset management company or in schemes under the management of any other asset management shall not exceed 5% of the net asset value of the Mutual Fund. However, such restriction is not applicable to investment in mutual funds in foreign countries made in accordance with SEBI circulars/guidelines issued in this regard from time to time.

· The Mutual Fund will buy and sell securities on the basis of deliveries and will in all cases of purchase, take delivery of relative securities and in all cases of sale, deliver the securities and shall in no case put itself in a position whereby it has to make short sales or carry forward transactions or engage in badla finance (carry forward).

Provided that the Mutual Fund shall enter into derivative transactions in a recognised stock exchange, in accordance with the guidelines issued by SEBI.

· The Mutual Fund shall get the securities purchased or transferred in the name of the Mutual Fund on account of the concerned Scheme, wherever the investments are intended to be of a long term nature.

· Pending deployment of funds of the Scheme in securities in terms of the investment objective of the Scheme, the Mutual Fund can invest the funds of the Scheme in short term deposits of scheduled commercial banks, provided:.

° any security issued by way of private placement by an associate or group company of the Sponsor; or

° the listed securities of group companies of the Sponsor which is in excess of 25% of the net assets.

Apart from the Investment Restrictions prescribed under the SEBI Regulations, internal risk parameters for limiting exposure to a particular scrip or sector may be prescribed from time to time to respond to the dynamic market conditions and market opportunities. The AMC/Trustee may alter the above Investment Restrictions from time to time to the extent that changes in the SEBI Regulations may allow and as deemed fit in the general interest of the Unitholders.

COMPUTATION OF NET ASSET VALUE

The Mutual Fund will value its investments according to the valuation norms, as specified in Schedule VIII of the SEBI Regulations, or such norms as may be specified by SEBI from time to time.

The AMC will calculate and disclose the first NAV of the Scheme not later than 30 days from the closure of New Fund Offer Period. Subsequently, the NAV of the Scheme will be disclosed at the close of every Business Day.

Separate NAVs will be calculated and announced for each of the Options under the Plan(s) of the Scheme. The NAVs will be rounded off upto 4 decimal places for the Scheme. The Units will be allotted upto 3 decimal places.

VALUATION OF THE SCHEME'S ASSETS AND DETERMINATION OF NET ASSET VALUE (NAV)

The NAV of the Units of the Scheme will be computed by dividing the net assets of the Scheme by the number of Units outstanding on the valuation date. The Mutual Fund will value its investments according to the valuation norms, as specified in the Schedule VIII of the SEBI Regulations, or such norms as may be prescribed by SEBI from time to time. The broad valuation norms pertaining to the Scheme are detailed below :

· Traded securities are valued at the last quoted closing price on the Principal Stock Exchange.

· When the Securities are traded on more than one recognised stock exchange, the Securities shall be valued at the last quoted closing price on the stock exchange where the security is principally traded. The AMC will select the appropriate stock exchange, but the reasons for the selection would be recorded in writing. All scrips may be valued at the prices quoted on the stock exchange where a majority in value of the investments are principally traded. Once a Stock Exchange has been selected for valuation of a particular security, reasons for change of the exchange shall be recorded in writing by the AMC.

· When on a particular valuation day, a security has not been traded on the principal stock exchange, the value at which it is traded on another stock exchange will be used.

· When a security (other than debt securities) is not traded on any stock exchange on a particular valuation day, the value at which it was traded on the principal stock exchange, as the case may be, on the earliest previous day is used provided such date is not more then 30 days prior to valuation date.

· When a debt security (other than Government securities) is not traded on any stock exchange on a particular valuation day, the value at which it was traded on the principal stock exchange or any other stock exchange, as the case may be, on the earliest previous day may be used, provided such date is not more than 15 days prior to valuation date.

· When a debt security (other than Government Securities) is purchased by way of private placement, the value at which it was bought may be used for a period of 15 days beginning from the date of purchase.

· When trading in an Equity / Equity related securities in a month is both less than Rs 5 lakhs and the total volume is less than 50,000 shares, it shall be considered as a thinly traded security and valued accordingly. Further it is clarified that in order to determine whether a security is thinly traded or not, the volumes traded in all recognised stock exchanges in

India

may be taken into account.

· Non-Traded / Thinly Traded Equity Securities will be fair valued as per procedures determined by the AMC and approved by Trustee of the Mutual Fund, in accordance with the SEBI Regulations and related circulars.

· In case trading in an equity security is suspended upto 30 days, then the traded price would be considered for valuation of that security. If an equity security is suspended for more than 30 days, then the AMC / Trustees will decided the valuation norms to be followed and such norms would be documented and recorded.

· A debt security (other than Government Securities) is considered as a thinly traded security if on the valuation date, there are no individual trades in that security in marketable lots (presently Rs 5 crore) on the principal stock exchange or any other stock exchange. Further it is clarified that in order to determine whether a security is thinly traded or not, the volumes traded in all recognised stock exchanges in

India

may be taken into account.

· A thinly traded debt security as defined above would be valued as per norms set for non-traded debt security.

· When a security (other than debt securities) is not traded on any stock exchange for a period of 30 days prior to the valuation date, the scrip will be treated as a non traded security

· When a debt security (other than Government Securities) is not traded on any stock exchange for a period of 15 days prior to the valuation date the scrip would be treaded as a non-traded security.

Non traded / thinly traded securities shall be valued “in good faith” by the AMC on the basis of valuation principles laid down below :

a. Based on the latest available Balance Sheet, net worth shall be calculated as follows :

b. Net Worth per share = [share capital + reserves (excluding revaluation reserves) – Misc. expenditure and Debit Balance in P&L A/c] Divided by No. of Paid up Shares.

c. Average capitalisation rate (P/E ratio) for the industry based upon either BSE or NSE data (which should be followed consistently and changes, if any noted with proper justification thereof) shall be taken and discounted by 75% i.e. only 25% of the Industry average P/E shall be taken as capitalisation rate (P/E ratio). Earnings per share of the latest audited annual accounts will be considered for this purpose.

d. The value as per the net worth value per share and the capital earning value calculated as above shall be averaged and further discounted by 10% for ill-liquidity so as to arrive at the fair value per share.

e. In case the EPS is negative, EPS value for that year shall be taken as zero for arriving at capitalised earning.

f. In case where the latest balance sheet of the company is not available within nine months from the close of the year, unless the accounting year is changed, the shares of such companies shall be valued at zero.

g. In case an individual security accounts for more than 5% of the total assets of the scheme, an independent valuer shall be appointed for the valuation of the said security. To determine if a security accounts for more than 5% of the total assets of the scheme, it should be valued by the procedure above and proportion which it bears to the total net assets of the scheme to which it belongs would be compared on the date of valuation

Non Traded / Thinly Traded Debt securities / asset backed securities purchased with residual maturity of upto 182 days are valued at cost (including accrued interest till the beginning of the day) plus the difference between the redemption value (inclusive of interest) and cost spread uniformly over the remaining maturity period of the instrument. Non Traded / Thinly Traded Debt securities/ asset backed securities purchased with maturity greater than 182 days at the time of purchase, the last valuation price plus accrued interest is used instead of purchase cost.

For the purpose of valuation, all Non Traded / Thinly Traded Debt Securities would be classified into “Investment grade” and “Non Investment grade” securities based on their credit ratings. The non-investment grade securities would further be classified as “Performing” and “Non Performing” assets

· All Non Government investment grade debt securities, classified as not traded, shall be valued on yield to maturity basis as described below.

· All Non Government non investment grade performing debt securities would be valued at a discount of 25% to the face value

· All Non Government non investment grade non performing debt securities would be valued based on the provisioning norms.

The approach in valuation of non traded debt securities is based on the concept of using spreads over the benchmark rate to arrive at the yields for pricing the non traded security.

The Yields for pricing the non traded debt security would be arrived at by using the process prescribed in the SEBI Guidelines for valuation of securities, from time to time.

Government Securities are valued at the prices released by CRISIL, which is currently the only approved agency suggested by Association of Mutual Funds in India (AMFI).

· The traded derivative shall be valued at market price in conformity with the stipulations of sub clause (i) to (v) of clause 1 of the Eighth Schedule to the SEBI Regulations.

(a) The securities with call option shall be valued at the lower of the value as obtained by valuing the security to final maturity and valuing the security to call option.

(b) In case there are multiple call options, the lowest value obtained by valuing to the various call dates and valuing to the maturity date is to be taken as the value of the instrument.

(a) The securities with put option shall be valued at the higher of the value as obtained by valuing the security to final maturity and valuing the security to put option

(b) In case there are multiple put options, the highest value obtained by valuing to the various put dates and valuing to the maturity date is to be taken as the value of the instruments.

The securities with both Put and Call option on the same day would be deemed to mature on the Put/Call day and would be valued accordingly.

Scheme’s investments in Foreign Securities will be valued at the last available closing market price/ last available traded price for the security. The same shall be converted into the local currency using the relevant reference exchange rate.

Reference rate as advised by RBI/ Bloomberg/ Reuters will be used for valuation of the portfolio of overseas investment. The Trustees reserve right to change the source for determining exchange rates.

· While investments in bills purchased under rediscounting scheme and short term deposits with banks shall be valued at cost plus accrual; other money market instruments shall be valued at the yield at which they are currently traded. For this purpose, non-traded instruments, that is instruments not traded for a period of 7 days, will be valued at cost plus interest accrued till the beginning of the day plus the difference between the redemption value and the cost spread uniformly over the remaining maturity period of the instruments;

· Where instruments have been bought on 'repo' basis, the instrument would be valued at the resale price after deduction of applicable interest upto date of resale. Where an instrument has been sold on a 'repo' basis, adjustment would be made for the difference between the Redemption price (after deduction of applicable interest upto date of Redemption) and the value of the instrument. If the Redemption price exceeds the value, the depreciation will be provided for and if the Redemption price is lower than the value, credit will be taken for the appreciation.

· In respect of convertible debentures and bonds, the non-convertible and convertible components shall be valued separately. The non-convertible component would be valued on the same basis as would be applicable to a debt instrument. The convertible component would be valued on the same basis as would be applicable to an equity instrument. If, after conversion, the resultant equity instrument would be traded pari passu with an existing instrument which is traded, the value of the latter instrument can be adopted after an appropriate discount for the non-tradability of the instrument during the period preceding the conversion. While valuing such instruments, the fact whether the conversion is optional would also be factored in.

· In respect of warrants to subscribe for shares, attached to instruments, the warrants would be valued at the value of the share which would be obtained on exercise of the warrant as reduced by the amount which would be payable on exercise of the warrant. A discount similar to the discount to be determined in respect of convertible debentures would be deducted to account for the period which must elapse before the warrant can be exercised.

· Until they are traded, the value of the “rights” shares would be calculated as :

Where the rights are not treated pari-passu with the existing shares, suitable adjustments would be made to the value of rights. Where it is decided not to subscribe for the rights but to renounce them and renunciations are being traded, the rights would be valued at the renunciation value.

Investments in Unlisted securities shall be valued “in good faith” on the basis of the valuation principles laid down below till such time these are listed on a Stock Exchange.

(a) Based on the latest available audited balance sheet, net worth shall be calculated as lower of (i) and (ii) below:

i. Net worth per share = [share capital plus free reserves (excluding revaluation reserves) minus Miscellaneous expenditure not written off or deferred revenue expenditure, intangible assets and accumulated losses] divided by Number of Paid up Shares.

ii. After taking into account the outstanding warrants and options, Net worth per share shall again be calculated and shall be = [share capital plus consideration on exercise of Option/Warrants received/receivable by the Company plus free reserves(excluding revaluation reserves) minus Miscellaneous expenditure not written off or deferred revenue expenditure, intangible assets and accumulated losses] divided by {Number of Paid up Shares plus Number of Shares that would be obtained on conversion/exercise of Outstanding Warrants and Options}

The lower of (i) and (ii) above shall be used for calculation of net worth per share and for further calculation in (c) below.

(b) Average capitalisation rate (P/E ratio) for the industry based upon either BSE or NSE data (which should be followed consistently and changes, if any, noted with proper justification thereof) shall be taken and discounted by 75% i.e. only 25% of the Industry average P/E shall be taken as capitalisation rate (P/E ratio). Earnings per share of the latest audited annual accounts will be considered for this purpose.

(c) The value as per the net worth value per share and the capital earning value calculated as above shall be averaged and further discounted by 15% for illiquidity so as to arrive at the fair value per share.

The above methodology for valuation shall be subject to the following conditions:

ii. In case where the latest balance sheet of the company is not available within nine months from the close of the year, unless the accounting year is changed, the shares of such companies shall be valued at zero.

iii. If the net worth of the company is negative, the share would be marked down to zero.

iv. In case the EPS is negative, EPS value for that year shall be taken as zero for arriving at capitalised earning.

v. In case an individual security accounts for more than 5% of the total assets of the scheme, an independent valuer shall be appointed for the valuation of the said security. To determine if a security accounts for more than 5% of the total assets of the scheme, it should be valued in accordance with the procedure as mentioned above on the date of valuation.

At the discretion of the AMC and with the approval of the trustees, an unlisted equity share may be valued at a price lower than the value derived using the aforesaid methodology.

The above methodology will not be applicable for investment made in the initial public offers of the companies (IPOs) or firm allotment in public issues where all the regulatory requirements and formalities pertaining to public issues have been complied with by the companies and where the Mutual Fund is required to pay just before the date of public issue.

(a) Aggregate value of “illiquid securities” of the scheme, which are defined as non-traded, thinly traded and unlisted equity shares, shall not exceed 15% of the total assets of the scheme and any illiquid securities held above 15% of the total assets shall be assigned zero value.

(b) All funds shall disclose as on March 31 and September 30 the scheme-wise total illiquid securities in value and percentage of the net assets while making disclosures of half yearly portfolios to the Unitholders. In the list of investments, an asterisk mark shall also be given against all such investments which are recognised as illiquid securities.

Valuation in respect of Non Performing Assets (Debt Securities) will be done in accordance with “SEBI guidelines for identification and provisioning for NPAs” issued vide circular dated 18th September, 2000 bearing reference no. MFD/CIR/8/92/2000 as modified by SEBI circulars both dated 28th March, 2001 bearing reference no. MFD/CIR/13/087/2001 as well as MFD/CIR/14/088/2001 and will form a part of this valuation policy.

All expenses and incomes accrued upto the valuation date shall be considered for computation of net asset value. For this purpose, major expenses like management fees and other periodic expenses would be accrued on a day to day basis. The other minor expenses and income will be accrued on a periodic basis, provided the non-accrual does not affect the NAV calculations by more than 1%.

Any changes in securities and in the number of Units will be recorded in the books not later than the first valuation date following the date of transaction. If this is not possible given the frequency of the Net Asset Value disclosure, the recording may be delayed upto a period of 7 days following the date of the transaction, provided that as a result of the non-recording, the Net Asset Value calculations shall not be affected by more than 1%.

In case the Net Asset Value of a Scheme differs by more than 1 %, due to non - recording of the transactions, the investors or Scheme as the case may be, shall be paid the difference in amount as follows:-

(i) If the investors are allotted Units at a price higher than Net Asset Value or are given a price lower than Net Asset Value at the time of sale of their Units, they shall be paid the difference in amount by the Scheme.

(ii) If the investors are charged lower Net Asset Value at the time of purchase of their Units or are given higher Net Asset Value at the time of sale of their Units, the AMC shall pay the difference in amount to the Scheme. The AMC may recover the difference from the investors.

The valuation guidelines as outlined above are as per the SEBI Regulations and are subject to change from time to time in conformity with changes made by SEBI.

ACCOUNTING POLICIES & STANDARDS

In accordance with Regulation 50 read with the Ninth Schedule to the SEBI Regulations, the Scheme shall follow the accounting policies and standards stated below:

· All investments will be marked to market and will be carried in the balance sheet at market value. However, since the unrealised gain arising out of appreciation on investments cannot be distributed, provision will be made for exclusion of this item when arriving at distributable income.

· Dividend income earned by a scheme should be recognised, not on the date the dividend is declared, but on the date the share is quoted on an ex-dividend basis. For investments which are not quoted on the stock exchange, dividend income must be recognised on the date of declaration.

· In respect of all interest-bearing investments, income will be accrued on a day to day basis as it is earned. Therefore when such investments are purchased, interest paid for the period from the last interest due date upto the date of purchase shall not be treated as a cost of purchase but shall be debited to Interest Recoverable Account. Similarly, interest received at the time of sale for the period from the last interest due date upto the date of sale shall not be treated as an addition to sale value but shall be credited to Interest Recoverable Account.

· In determining the holding cost of investments and the gains or loss on sale of investments, the "average cost" method shall be followed.

· Bonus shares to which the scheme becomes entitled should be recognised only when the original shares on which the bonus entitlement accrues are traded on the stock exchange on an ex-bonus basis. Similarly, rights entitlements should be recognised only when the original shares on which the right entitlement accrues are traded on the stock exchange on an ex-rights basis.

· Transactions for purchase or sale of investments would be recognised as of the trade date and not as of the settlement date, so that the effect of all Investments traded during a financial year are recorded and reflected in the financial statements for that year. When investment transactions take place outside the stock market, for example, acquisitions through private placement or purchases or sales through private treaty, the transaction would be recorded, in the event of a purchase, as of the date on which the Scheme obtains an enforceable obligation to pay the price or, in the event of a sale, when the Scheme obtains an enforceable right to collect the proceeds of sale or an enforceable obligation to deliver the instruments sold.

· An 'asset' shall be classified as non performing, if the interest and / or principal amount have not been received or remained outstanding for one quarter from the day such income / instalment has fallen due. After the expiry of the 1st quarter from the date the income has fallen due, there will be no further interest accrual on the asset. In short, from the beginning of the 2nd calendar quarter there will be no further accrual on income.

· Where income receivable on investments has accrued but has not been received for the period specified in the guidelines issued by SEBI, provision shall be made by debiting to the revenue account, the income so accrued in the manner specified by the guidelines issued by SEBI.

· When Units are sold, the difference between the Sale price and the face value of the Unit, if positive shall be credited to reserves and if negative will be debited to reserves, the face value being credited to Capital Account. Similarly, When Units are Redeemed, the difference between the repurchase price and face value of the Unit, if positive, shall be debited to reserves, and, if negative, shall be credited to reserves, the face value being debited to the Capital account.

· When Units are sold, an appropriate part of the Sale proceeds shall be credited to an Equalisation Account and when Units are redeemed, an appropriate amount would be debited to Equalisation Account. The net balance on this account shall be credited or debited to the Revenue Account. The balance on the Equalisation Account debited or credited to the Revenue Account shall not decrease or increase the net income of the Mutual Fund but is only an adjustment to the distributable surplus. It shall therefore, be reflected in the Revenue Account only after the net income of the Mutual Fund is determined.

· The cost of investments acquired or purchased would include, brokerage, stamp charges and any charge customarily included in the broker's bought note. In respect of privately placed debt instruments any front-end discount offered shall be reduced from the cost of the investment.

· Underwriting commission shall be recognised as revenue only when there is no devolvement on the Scheme. Where there is devolvement on the Scheme, the full underwriting commission received and not merely the portion applicable to the devolvement shall be reduced from the cost of the investment.

The accounting polices and standards outlined above are as per the existing SEBI Regulations and are subject to changes to be in compliance to reflect the changes in the SEBI Regulations. All other policies and standards as specified therein, as well as any additions / modifications thereto as may be specified by SEBI from time to time shall be adhered to while preparing the books of accounts and financial statements of the Mutual Fund.

UNCLAIMED REDEMPTION / DIVIDEND AMOUNT

As per circular no MFD/CIR/9/120/2000, dated November 24, 2000 issued by SEBI, the unclaimed redemption and dividend amounts shall be deployed by the Mutual Fund in money market instruments only and the investors who claim these amounts during a period of three years from the due date shall be paid at the prevailing Net Asset Value. After a period of three years, this amount will be transferred to a pool account and the investors can claim the amount at NAV prevailing at the end of the third year. The income earned on such funds will be used for the purpose of investor education. The AMC will make a continuous effort to remind the investors through letters to take their unclaimed amounts. Further, the investment management fee charged by the AMC for managing unclaimed amounts shall not exceed 50 basis points.

INVESTMENT BY THE AMC IN THE SCHEME

The AMC may invest in the Scheme in the New Fund Offer Period or thereafter at any time during the continuous offer period subject to the SEBI Regulations & circulars issued by SEBI and to the extent permitted by its Board of Directors from time to time. As per the existing SEBI Regulations, the AMC will not charge investment management and advisory fee on the investment made by it in the Scheme.

SECTION III

UNITS & THE NEW FUND OFFER

UNITS ON OFFER - GENERAL INFORMATION

1. New Fund Offer:

This offer is being made for Subscription of Units of ABN AMRO China Equity Fund, an Open End Equity Scheme investing in Chinese Equities.

2. New Fund Offer Period

The New Fund Offer Period for the Scheme will commence from _______ and close on _________.

3. New Fund Offer Price

The New Fund Offer Price of Units of the Scheme/ Plan(s) will be Rs.10 per Unit plus applicable entry load.

4. Extension / Termination of the New Fund Offer Period

The Trustee reserves the right to extend the closing date of the New Fund Offer Period for the Scheme subject to the condition that the subscription list of the New Fund Offer Period shall not be kept open for more than 30 days.

5. Minimum Subscription Amount

The minimum subscription (target) amount for the Scheme is Rs.1 Crore. There is no maximum target for the size of the Scheme and therefore, subject to the applications being in accordance with the terms of this offer, full and firm allotment will be made to all the applicants, subject to the collection of the minimum subscription amount.

In accordance with the SEBI Regulations, if any of the Plan(s) under the Scheme fails to collect the above minimum subscription amount, the Mutual Fund and the AMC shall be liable to refund the subscription amount within a period of 6 weeks from the date of closure of subscription list to the applicants of the Plan.

6. Allotment and Refund

All applicants will receive full and firm allotment of Units, provided the applications are complete in all respects and are found to be in order, subject to the collection of the minimum subscription amount. The Trustee / AMC retain the sole and absolute discretion to reject any application. The process of allotment of Units and mailing of account statements reflecting the allotments will be completed within 30 days from the date of closure of the New Fund Offer Period.

In accordance with the SEBI Regulations, if any of Plan(s) under the Scheme fails to collect the minimum subscription amount, the Mutual Fund and the AMC shall be liable to refund the money to the applicants under that Plan.

In addition to the above, refund of subscription amount to applicants whose applications are invalid for any reason whatsoever, will commence after the allotment process is completed.

No Interest will be payable on any subscription amount refunded within 6 weeks from the closure of the New Fund Offer Period. Interest on subscription amount will be payable for amounts refunded later than 6 weeks from the closure of the New Fund Offer Period at the rate of 15% per annum for the period in excess of 6 weeks and will be charged to the AMC. Refund orders will be marked "A/c. Payee only" and will be in favour of and be despatched to the sole / first Applicant, by registered post.

MINIMUM AMOUNT AND ADDITIONAL AMOUNT FOR APPLICATION

Dividend Option has to options viz. Dividend Reinvestment Option and Dividend Payout Option

There is no upper limit on the amount for application. The Trustee / AMC reserves the right to change the minimum amount for application and the additional amount for application from time to time in the Scheme and these could be different under different plan(s) / option(s).

INVESTMENT PLANS OFFERED UNDER THE SCHEME

The Scheme offers investors Regular & Institutional Plan. The said Plans offer Growth Option and Dividend Option. The Dividend Option offers Dividend Payout and Dividend Re-investment facilities.

The Scheme will not declare any Dividend under this Option. The income attributable to Units under this Option will continue to remain invested in the Option and will be reflected in the Net Asset Value of Units under this Option.

Under this Dividend Option, dividend if any, shall be declared by the Trustee from time to time.

Choice of Plan(s) / Option(s)

Investors should indicate appropriate Option for which the Subscription is made by indicating the choice in the appropriate box provided for this purpose in the application form. In case of valid applications received without indicating any choice of Option, it will be considered as an option for Growth Option and processed accordingly.

Investors may also opt to simultaneously invest in any / all Option(s) of the Scheme/ Plan(s) subject to minimum Subscription requirements under such Option(s).

DIVIDENDS & DISTRIBUTIONS

Under this Scheme, the Trustee may distribute dividend, from time to time. The Trustee's decision with regard to the rate, timing and frequency of distribution shall be final.

It must be distinctly understood that the actual declaration of dividend under the Dividend Option and the frequency thereof will inter-alia, depend on the availability of distributable profits as computed in accordance with the SEBI Regulations. The Trustee reserves the right of dividend declaration and the decision of the Trustee in this regard shall be final. Dividends if declared, will be paid to the Unitholders appearing in the Register of Unitholder on the Record Date. To the extent the entire net income and realised gains are not distributed, the same will remain invested in the Option and will be reflected in the NAV. There is no assurance or guarantee to Unitholders as to the rate of dividend distribution nor will that dividend be paid regularly. The Dividends shall be declared subject to the availability of distributable surplus under the Option.

The AMC may announce a book closure period for the purpose of making the dividend payment. The Trustee at its sole discretion may declare an interim dividend under the Dividend Option.

EFFECT OF DIVIDENDS

The NAV of the Unitholders in any of the Dividend Option will stand reduced by the amount of dividend declared. The NAV of the Growth Option will remain unaffected.

DIVIDEND RE-INVESTMENT FACILITY

Unitholders opting for the Dividend Option(s) may choose to reinvest the dividend to be received by them in additional Units of the respective Option(s) (applicable only in the Option(s) where this facility is offered). Under this facility, the dividend due and payable to the Unitholders will be compulsorily and without any further act by the Unitholders, reinvested in the Scheme (under the respective Dividend Options), at a price based on the ex-dividend Net Asset Value per Unit. The amount of dividend re-invested will be net of tax deducted at source, wherever applicable. The dividends so reinvested shall constitute a constructive payment of dividends to the Unitholders and a constructive receipt of the same amount from each Unitholder for reinvestment in Units.

On reinvestment of dividends, the number of Units to the credit of Unitholder will increase to the extent of the dividend reinvested at the NAV as explained above. There shall however be no Entry / Sales Load on the dividend so reinvested.

FACILITIES

Systematic Transfer Plan (STP)

The salient features of Systematic Transfer Plan (STP) under the Scheme are as under:

1. STP is a facility wherein investors can opt to transfer a fixed amount or capital appreciation amount at regular intervals from AAFDF, AAFRF, AACF, AAMIP and AAMPS into ABN AMRO China Equity Fund.

Both the Facilities will offer transfers at weekly, monthly and quarterly intervals. Unitholder is free to opt for any of the above Facilities and also choose the frequency of such transfers.

3. Under the FSTF - An investor can issue a standing instruction to transfer sums at a Weekly / Monthly / Quarterly (calendar quarter) intervals to Plans / Options within select Schemes of ABN AMRO Mutual Fund. The investor has a choice between weekly, monthly and quarterly FSTF. The Transfer should be 1st or 7th or 15th or 25th of a month in the Weekly FSTF and as the 1st or 7th or 15th or 25th of a month in the Monthly FSTF and as the 1st or 7th or 15th or 25th of the first month of quarter (e.g. 1st or 7th or 15th or 25th of January, April, July and October) in a Quarterly FSTF. Transfers must be for a minimum** amount of Rs. 1,000/- or in multiples of Re.1/- thereafter in Weekly, Monthly and Quarterly FSTF. An investor will have to opt for a minimum of 6 installments under Weekly and Monthly STP and 2 installments under Quarterly STP. In FSTF, in case there is no minimum amount (as specified above) available in the unitholder's account the transfer to the Transferee Scheme will not happen and the STP request of the unitholder will stand withdrawn.

4. Under the CASTF - An investor can issue a standing instruction to transfer the entire capital appreciation from Transferor Scheme at Weekly / Monthly / Quarterly intervals to designated Scheme(s) of ABN AMRO Mutual Fund. The investor has a choice between Weekly, Monthly and Quarterly CASTF. The transfer date should be 1st or 7th or 15th or 25th of a month in the Weekly CASTF and as the 1st or 7th or 15th or 25th of a month in the Monthly CASTF and as the 1st or 7th or 15th or 25th of the first month of Quarter (e.g. 1st, 7th, 15th or 25th of January, April, July and October) in a quarterly CASTF. Transfers must be for a minimum amount** of Rs. 1,000/- in the multiple of Re 1/- in Weekly, Monthly and Quarterly CASTF. An investor will have to opt for a minimum of 6 installments under Weekly and Monthly CASTF or 2 installments under Quarterly CASTF. Please note that no transfer will take place if there is no minimum appreciation amount and the STP request of the unitholder will stand withdrawn. The capital appreciation, if any, will be calculated from the enrolment date of the CASTF under the folio, till the first transfer date (e.g. if the unit holder has been allotted units on the 23rd of September and the date of enrolment for monthly CASTF is the 1st of November and the unit holder has opted for 15th of every month as the transfer date, capital appreciation, if any, will be calculated from the 1st of November to the 15th of November (first transfer date). Subsequent capital appreciation, if any, will be the capital appreciation between the previous CASTF date (where transfer has been processed) and the next CASTF date.

** In case of AATAP an investor under WSIF or MSIF or QSIF must invest a minimum of Rs. 500/- and in multiples of Re 500/- thereafter.

5. A request for STP will be treated as a request for Redemption from / Subscription into the respective Option(s) of the Scheme(s), at the applicable NAV, subject to applicable Load.

The provisions of Entry Load and exit load / CDSC, as applicable to the normal investments as on the date of enrolment will be applicable to fresh STP investments.

STP is available to investors on the commencement of ongoing Sale and Redemption of the Units under the Scheme after the New Fund Offer Period.

Systematic Investment Plan (SIP)

Under SIP the investor can for a continuous period of time invest a fixed amount at regular intervals for purchasing additional Units of the Scheme at the Applicable NAV, subject to applicable Load.

An investor must invest a minimum* of Rs.1,000/- and in multiples of Re.1/- thereafter on a weekly basis by providing in advance a minimum of 6 post-dated cheques, for a block of 6 weeks.

An investor must invest a minimum* of Rs.1,000/- and in multiples of Re.1/- thereafter on a monthly basis by providing in advance a minimum of 6 post-dated cheques, for a block of 6 months.

An investor must invest a minimum* of Rs.1,000/- and in multiples of Re.1/- thereafter on a quarterly basis by providing in advance a minimum of 2 post-dated cheques, for a block of 6 months.

* In case of AATAP an investor under WSIF or MSIF or QSIF must invest a minimum of Rs. 500/- and in multiples of Re 500/- thereafter.

Post-dated cheques for SIP should be dated 1st, 7th, 15th and 25th of a month under WSIF. For MSIF it should be either 1st or 7th or 15th or 25th of a month or first month of each quarter under QSIF (e.g. 1st or 7th or 15th or 25th of January, April, July and October). In case the date falls on a Non-Business Day or falls during a book closure period, the immediate next Business Day will be considered for the purpose of determining the applicability of NAV subject to the realization of cheques. Units will be allotted on the above applicable dates.

The provisions of Entry Load and exit load / CDSC, as applicable to the normal investments as on the date of enrolment will be applicable to fresh SIP investments.

The cheques should be drawn in favour of the respective “Scheme / Plan / Option” and crossed “A/c Payee Only” and must be payable at the locations where applications are submitted at the Official Points of Acceptance of Transactions. Unit holders must write the SIP Enrolment Form number, if any, on the reverse of the cheques accompanying the SIP Enrolment Forms. Outstation cheques will not be accepted and applications accompanied by such cheques

An account statement will be dispatched by mail or by e-mail (if opted by the Unit holder) to the Unit holder normally within 3 Business Days from the date of transaction indicating the new balance to the credit of the Unit holder’s account.

Investors have the right to discontinue the SIP facility at any time by sending a written request to any of the Official Points of Acceptance of Transactions. Such notice should be received at least 14 days prior to the due date of the next cheque. On receipt of such request, the SIP facility will be terminated and the remaining unutilised post-dated cheque(s) will be returned to the investor.

Normally, Account Statements / Newsletters are sent to each Unit holder by courier / post / email It is the intent of the AMC to send such communication via e-mail. It may be noted that ABN AMRO Asset Management (

India

) Limited retains the right to send such documents by courier / post, even if the Unit holder has opted for this facility.

SIP is available to investors on the commencement of ongoing Sale and Redemption of the Units under the Scheme after the New Fund Offer Period.

Systematic Withdrawal Plan (SWP)

This facility is available to Unitholders of the Scheme to enable them to withdraw a fixed or a variable amount from their investment accounts at periodic intervals.

Investors can enrol themselves for the facility by submitting the duly completed SWP Enrolment Form at any of the ISC. Please refer the Enrolment Form for detailed terms and conditions of SWP.

The salient features of Systematic Withdrawal Plan (SWP) under the said scheme are as under:

1. Under SWP the investors can opt to withdraw (i.e. redeem from the Scheme) a fixed or a variable amount from their investment accounts at periodic intervals.

3. Under the FSWF an investor can issue a standing instruction to withdraw sums at a Monthly / Quarterly (calendar quarter) intervals. The investor has a choice between monthly and quarterly FSWF. The withdrawal shall be 1st of a month in the Monthly FSWF and 1st of the first month of quarter (e.g. 1st of January, April, July and October) in a Quarterly FSWF. Withdrawal must be for a minimum amount of Rs. 1,000/- or in multiples of Re.1/- thereafter in Monthly FSWF and Rs. 3,000/- and in multiples of Re.1/- in Quarterly FSWF. An investor will have to opt for a minimum of 6 transactions under Monthly FSWF and 2 transactions under Quarterly FSWF. If the net asset value of the Units outstanding on the withdrawal date is insufficient to process the withdrawal request, then the Mutual Fund will redeem all Units outstanding and the SWP request will stand withdrawn for further processing.

4. Under the CASWF an investor can issue a standing instruction to withdraw the entire capital appreciation from the Scheme at Monthly / Quarterly intervals. The investor has a choice between Monthly and Quarterly CASWF. The withdrawal date shall be 1st, of a month in the Monthly CASWF and 1st of the first month of Quarter (e.g. 1st of January, April, July and October) in a quarterly CASWF. Withdrawal must be for a minimum amount of Rs. 1,000 in Monthly CASWF and Rs. 3,000/- in Quarterly CASWF. An investor will have to opt for a minimum of 6 transactions under Monthly CASWF or 2 installments under Quarterly CASWF. Please note that if there is no minimum appreciation amount on the withdrawal date, then the Mutual Fund shall process the withdrawal request for that date and the SWP request of the unit holder will stand withdrawn for further processing. The capital appreciation, if any, will be calculated from the enrolment date of the CASWF under the folio, till the withdrawal date (i.e. the 1st of a month in the Monthly CASWF and 1st of the first month of Quarter in a quarterly CASWF). Subsequent capital appreciation, if any, will be the capital appreciation between the previous CASWF date and the next CASWF date.

5. If the withdrawal date under FSWF / CASWF falls on a non-business day the next Business Day will be considered for this purpose.

6. A request for SWP will be treated as a request for Redemption from the Scheme, at the applicable NAV, subject to applicable Load.

The Trustee / AMC reserves the right to change / modify the terms of the SIP, STP and SWP. The above load structure will be in force till further notice. This load structure is subject to change and may be imposed / modified prospectively from time to time, as may be decided by the Trustee / AMC from time to time.

SWP is available to investors on the commencement of ongoing Sale and Redemption of the Units under the Scheme after the New Fund Offer Period.

Switching Facility

During the New Fund Offer Period of the Scheme, unitholders of the Fund have the option to switch-in, all or part of their investment from any other scheme of the Fund to this Scheme. The switch-out will be effected at the Applicable NAV of the respective (switch-out) Scheme (subject to applicable cut-off time and applicable load), on the day of acceptance of the switching request. The switch-in will be affected at the New Fund Offer Price, plus applicable entry load, if any. Switch request will be subject to applicable exit load of the relevant scheme. During the New Fund Offer Period, no Entry Load is payable for switch-in from any equity scheme of the Mutual Fund into the Scheme. All switch requests during the New Fund Offer Period of the Scheme will have to be submitted at the Official Points of Acceptance of Transactions. Switch requests received at any other centres are liable to be rejected.

On an on-going basis, the Unitholders have the option to switch all or part of their investment from the Scheme to any of the other scheme(s) offered by the Mutual Fund, which is available for investment at that time, subject to applicable Load structure of the respective schemes. Unitholders also have the option of switching into the Scheme from any other schemes or switching between various Options of the Scheme. To affect a switch, a Unitholder must provide clear instructions. A request for a switch may be specified either in terms of a rupee amount or in terms of the number of Units of the Scheme from which the switch is sought. Where a request for a switch is for both, amount and number of Units, the amount requested will be considered as the definitive request. Such instructions may be provided in writing and lodged on at any of the Investor Service Centres / Designated Collection Centres. An Account Statement / Transaction Confirmation reflecting the new holdings will be despatched to the Unitholders normally within 3 Business Days of acceptance of the request for the Scheme.

The switch will be affected by redeeming Units from the Plan(s) / Option(s) of the Scheme in which the Units are held and investing the net proceeds in the other Plan(s) / Option(s) of the Scheme, subject to the minimum balance, minimum application amount and Subscription / Redemption criteria applicable for the respective Scheme(s). A request for switch will be treated as a request for Redemption from / Subscription into the respective options / Plans of the Schemes, at the Applicable NAV, subject to applicable Load, if any.

A switch by NRI / FII Unitholders will be subject to relevant laws, rules, and regulations at the time of switch.

The AMC reserves the right to charge different (including zero) Load on Applicable NAV on switchover as compared to the repurchase as the case may be.

Switch-out from the Scheme is available to investors on the commencement of ongoing Repurchase / Redemption of the Units under the Scheme after the New Fund Offer Period. Please refer ___ for procedure of Redemption/ Repurchase of units

WHO CAN INVEST?

1. Resident adult individuals either singly or jointly (not exceeding three) or on an Anyone or Survivor basis;

5. Companies, Bodies Corporate, Public Sector Undertakings, Association of Persons or Bodies of Individuals (whether incorporated or not) and Societies registered under the Societies Registration Act, 1860;

8. Religious and Charitable Trusts, Wakfs or endowments of private trusts (subject to receipt of necessary approvals as required) and Private trusts authorised to invest in mutual fund schemes under their trust deeds & applicable statutory law;

9. Non-resident Indians (NRIs)/Persons of Indian Origin residing abroad (PIO) either on repatriation basis or non-repatriation basis;

11. Army, Air Force, Navy and other paramilitary units and bodies created by such institutions;

13. Multilateral Funding Agencies approved by the Government of India/Reserve Bank of

India

;

14. Scheme(s) of ABN AMRO Mutual Fund subject to the conditions and limits prescribed by the SEBI Regulations;

15. Trustee, AMC, Sponsor and their associates may subscribe to Units under this Scheme;

16. Such other individuals/institutions/body corporate etc., as may be decided by the AMC from time to time, so long as wherever applicable they are in conformity with the SEBI Regulations.

The Mutual Fund reserves the right to include / exclude new / existing categories of investors to invest in the Scheme from time to time, subject to the SEBI Regulations and other prevailing statutory regulations, if any.

2. Overseas Corporate Bodies (OCBs) shall not be allowed to invest in the Scheme. These would be firms and societies, which are held directly or indirectly but ultimately to the extent of at least 60% by NRIs and trusts in which at least 60% of the beneficial interest is similarly held irrevocably by such persons (OCBs).\

The Fund reserves the right to include / exclude new / existing categories of investors to invest in the Scheme from time to time, subject to SEBI Regulations and other prevailing statutory regulations, if any.

1. RBI has vide Schedule 5 of the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000, granted a general permission to NRIs / Persons of Indian Origin residing abroad (PIOs) and FIIs for purchasing/ redeeming Units of the mutual funds subject to conditions stipulated therein.

2. Returned cheques are liable not to be presented again for collection, and the accompanying application forms are liable to be rejected. In case the returned cheques are presented again, the necessary charges are liable to be debited to the investor.

3. No request for withdrawal of application made during the New Fund Offer Period will be entertained.

HOW TO APPLY?

1. The application form for the Sale of Units of the Scheme will be available and accepted at the office of the Collection Centres / ISCs given in the inside back cover of the Offer Document.

2. All switch requests during the New Fund Offer Period of the Scheme will have to be submitted at the Official Points of Acceptance of Transactions. Switch requests received at any centres are liable to be rejected. The switch will be effected at the Applicable NAV (subject to applicable cut-off time and applicable load), for the day of acceptance of the switching request.

5. All cheques and bank drafts must be drawn in favour of the Scheme and crossed "A/c Payee only". For e.g. cheques and bank drafts in case of ABN AMRO China Equity Fund shall be made in favour of “ABN AMRO China Equity Fund”. A separate cheque or bank draft must accompany each application. Investors must use separate application forms for investing simultaneously in Option(s) of the Scheme subject to the Minimum Application Amounts under each Option.

6. All cheques and bank drafts accompanying the application form should contain the application form number on its reverse.

7. As per the directives issued by SEBI, it is mandatory for applicants to mention their Bank Account number in their Subscription / Redemption request. Any application form without these details shall not be accepted.

8. In addition to providing the redemption bank mandate, it is mandatory for applicants to mention their Bank Account number, instrument number and the Bank name from which the subscription is funded, in their each Subscription request.

9. It is mandatory for investors making an application for investment to furnish KYC Confirmation and PAN alongwith a copy of a document, evidencing the PAN.

PAN requirement with effective from July 2, 2007 upto December 31, 2007

For applicable transactions below Rs. 50,000/-: Either PAN Copy or copy of evidence of having applied for PAN.

For applicable transactions of Rs. 50,000/-or above: Either PAN Copy or copy of evidence of having applied for PAN and Form 60 along with proof of address.

Copies of all the above documents have to be self certified by the investor and the original PAN card or evidence of having applied for PAN should be made available for verification in the manner and to the entity as may be specified by the ABN AMRO Asset Management Company (India) Limited (AMC) from time to time.

However, it may be noted that PAN copy will be mandatory for all transactions w.e.f. January 1, 2008.

(a) If the application is being jointly made with other co-applicants, the PAN for each of the co-applicants should be furnished along-with a copy of a document, evidencing the PAN for each of the co-applicant.

(b) Where the person making an application is a minor and does not have any income chargeable to income tax, he shall quote the PAN of the guardian, along-with a copy of the document, evidencing the PAN.

Applications without this information and documents will be deemed to be incomplete and liable to be rejected. Further, applications, where the details of the documents submitted as evidence for PAN does not match with the applicants / existing information available with ABN AMRO Mutual Fund, will be rejected.

10. In case of an application under a Power of Attorney, the application should be accompanied by an original Power of Attorney or by a duly notarised copy of the Power of Attorney. The Mutual Fund / Trustee / AMC reserve the right to reject the application forms not accompanied by a Power of Attorney. Further, the Mutual Fund / Trustee / AMC reserves the right to hold Redemption / Repurchase proceeds in case the requisite documents are not submitted.

11. For applications by a company, body corporate, eligible institutions, registered society, trusts, partnership or other eligible non-individuals who apply in the Scheme should furnish a certified copy of resolution or authority to make the application as the case may be and a certified copy of the Memorandum and Articles of Association and / or bye-laws and / or Trust Deed and / or Partnership Deed and certificate of registration or any other document as the case may be. In case of a trust / fund, it shall submit a certified true copy of the resolution from the trustee(s) authorising such Subscriptions and Repurchase /Redemptions. The authorised officials should sign the application under their official designation. A list of specimen signatures of the authorised officials, duly certified / attested should also be attached to the Application Form.

12. Applications not complete in any respect are liable to be rejected. Applications not specifying the Scheme / Option and/or accompanied by cheque / demand drafts / account-to-account transfer instructions favouring the Scheme / Option other than that specified in the application are liable to be rejected.

13. Application form without the details mentioned in Instruction 7, 8, 9 & 11 will not be accepted by the mutual fund. If accepted due to oversight, the same would be liable to be rejected within a reasonable period of time and given back to the investor/s.

14. The AMC / Trustee retains the sole and absolute discretion to reject any application.

MODE OF PAYMENT

(a) For Investors having a bank account with such banks with whom the AMC would have an arrangement from time to time:

Payment may be made for Subscription to the Units of the Scheme either by issuing a cheque drawn on such banks or by giving a debit mandate to their account with any branch of such banks with whom the AMC would have an arrangement from time to time.

Payment may be made by cheque or bank draft drawn on any bank, which is situated at and is a member of the Bankers' Clearing House, located at the place where the application is submitted. No cash, money orders, outstation cheques, post dated cheques (except for Systematic Investment Plans) and postal orders will be accepted. Bank charges for outstation demand drafts will be borne by the AMC and will not be charged to the scheme. Demand Draft charges to be borne by the AMC will be limited to the bank charges levied by State Bank of

India

, if a demand draft issued by a bank in a place where there is no ISC / Collection Centre provided for the investors. In all other cases, the AMC will not accept any request for refund of demand draft charges.

· In the case of NRIs/PIOs, payment may be made either by inward remittance through normal banking channels or out of funds held in his / her Non – Resident (External) Rupee Account (NRE) / Foreign Currency (Non-Resident) Account (FCNR).

· FIIs shall pay their Subscription either by inward remittance through normal banking channels or out of funds held in Foreign Currency Account or Non-Resident Rupee Account maintained with the designated branch of an authorised dealer in accordance with the relevant exchange management regulations.

Provided that the FII shall restrict allocation of its total investment between equity and debt instruments (including dated Government Securities and Treasury Bills in the Indian capital market) in the ratio of 70:30.

In the case of NRIs seeking to apply for units on a non-repatriation basis, payment may be made either by inward remittance through normal banking channels or out of funds held in his / her NRE / FCNR / Non-Resident Ordinary Rupee Account (NRO).

CHEQUE BOUNCING

In cases where the cheque(s) given by the investor for the application made by him/her in the Scheme, are bounced (i.e. not realised) on presentation to the Bank on which it is drawn, the AMC/Trustee/Mutual Fund reserves the right to reject the application and also restrain the said investor from making any further investment in any of the Schemes of the Mutual Fund. The AMC/Trustee/Mutual Fund will not be responsible in any manner whatsoever for any losses / damages caused to the investor as result of the AMC/Trustee/Mutual Fund rejecting the application on the basis of cheque bouncing and also for restraining the investor from making any further investment in any of the Schemes of the Mutual Fund.

The investor/unitholder shall indemnify the AMC/ Trustee/ Mutual Fund at all times and keep the AMC/Trustee/Mutual Fund indemnified and save harmless against any and all claims, losses, damages, costs, liabilities and expense (including without limitation, interest and legal fees) actually incurred, suffered or paid by the AMC/ Trustee/ Mutual Fund (directly or indirectly) and also against all demands, actions, suits proceedings made, filed, instituted against the AMC/ Trustee/ Mutual Fund (by the investor or any third party), in connection with or arising out of or relating to the AMC/ Trustee/ Mutual Fund rejecting the application of the investor on the basis of cheque bouncing and/or also for restraining the investor from making any further investment in any of the Schemes of the Mutual Fund.

MASTER ACCOUNT / FOLIO

As an investor friendly measure, unless otherwise requested by the Unitholder, one Master Account / Folio Number will be assigned for one Unitholder having holdings in different schemes of the Mutual Fund. In such a case, one consolidated Account Statement will be provided. The number of Units allotted to a Unitholder or Redeemed will be reflected in his or her account and a statement to this effect will be issued to the Unitholder. The Trustee / AMC reserves the right to assign the existing Master Account/ Folio Number against multiple applications and/or subsequent purchases under a new application form by an existing Unitholder, with identical mode of holding and address.

ACCOUNT STATEMENT

An Account Statement will be sent by ordinary post / courier / email not later than 30 Business Days from the close of the New Fund Offer Period. The Account Statements shall be non-transferable. Also, an Account Statement reflecting the net balance of the Unitholder will be mailed to the Unitholder by ordinary post /courier / email after every financial transaction is effected, except in exceptional circumstances. The Account Statement shall not be construed as a proof of title and is only a computer-printed statement indicating the details of transactions under the Scheme.

Under normal circumstances on an on-going basis, an Account Statement reflecting the holdings will be despatched to the Unitholders normally within 3 Business Days of acceptance of the valid request for the Scheme. Provided that the Mutual Fund / Trustee / AMC reserves the right to reverse the transaction of crediting Units in the Unitholder's account, in the event of non-realisation of any cheque or other instrument remitted by the investor.

UNIT CERTIFICATES

Normally no Unit certificates will be issued. However, if the applicant so desires, the AMC shall issue a non-transferable Unit certificate to the applicant within 6 weeks of the receipt of request for the certificate. Unit certificate if issued must be duly discharged by the Unitholder(s) and surrendered to the Mutual Fund alongwith the request for Redemption/ Repurchase / Switch-out or any other transaction of Units covered therein.

HOUSEHOLDINGS

In case newsletters are sent to each Unitholder by post / courier which may result in certain households with one or more members as the Unitholders of the Scheme getting multiple copies. In such cases the AMC will cull the database and send each such "household" a single newsletter. The AMC feels that this will not inconvenience the Unitholders. In case it does the Unitholder can write to the AMC, for additional copies.

MODE OF HOLDING

The applicants can specify the 'mode of holding' in the Application Form as “Single” or “Jointly” or “Anyone or Survivor”.

In the event the account has more than one registered holder, the first-named Unitholder (as determined by reference to the original Application Form) shall receive the account statements, all notices and correspondence with respect to the account, as well as the proceeds of any Redemption requests or dividends or other distributions. In addition, such holder shall have the voting rights, as permitted, associated with such Units as per the applicable guidelines.

In the case of holding specified as 'Jointly', Redemptions/ Repurchase / Switch requests would have to be signed by all joint holders. However, in cases of holding specified as 'Anyone or Survivor', any one of the Unitholders will have the power / authority to make Redemption/ Repurchase / Switch requests, without it being necessary for all the Unitholders to sign. However, in all cases, the proceeds of the Redemption / Repurchase will be paid to the first-named of such remaining Unitholders.

In case of death / insolvency of any one or more of the persons named in the Register of Unitholders as the joint holders of any Units, the AMC shall not be bound to recognise any person(s) other than the remaining holders. In all such cases, the proceeds of the Redemption will be paid to the first-named of such remaining Unitholders.

NOMINATION FACILITY

Pursuant to Regulation 29A of the SEBI Regulations, the AMC is providing an option to the Unitholder to nominate (in the manner prescribed under the SEBI Regulations), a person in whom the Units held by him shall vest in the event of his death. Where the Units are held by more then one person jointly, the joint Unitholders may together nominate a person in whom all the rights in the Units shall vest in the event of death of all the joint Unitholders. By provision of this facility the AMC is not in any way attempting to grant any rights other than those granted by law to the nominee. A nomination in respect of the Units does not create an interest in the property after the death of the Unitholder. The nominee shall receive the Units only as an agent and trustee for the legal heirs or legatees as the case may be. It is hereby clarified that the nominees under the nomination facility provided herein shall not necessarily acquire any title or beneficial interest in the property by virtue of this nomination.

The nomination can be made only by individuals applying for / holding Units on their own behalf singly or jointly. Non-individuals including society, trust, body corporate, partnership firm, Karta of Hindu Undivided Family, holder of Power of Attorney cannot nominate.

Only one person per folio can be nominated. A minor can be nominated and in that event, the name and address of the Guardian of the minor Nominee shall be provided by the Unitholder. Nomination can also be in favour of the Central Government, State Government, a local authority, and any person designated by virtue of his office or a religious or charitable trust.

The Nominee shall not be a trust other than a religious or charitable trust, society, body corporate, partnership firm, Karta of Hindu Undivided Family or a Power of Attorney holder. A non-resident Indian can be a Nominee subject to the exchange controls in force from time to time. Units will be transmitted in favour of the nominee only after the death of all existing Unitholders.

Nomination in respect of the Units stands rescinded upon the Redemption/ Repurchase /transfer of Units. Cancellation of nomination can be made only by those individuals who hold Units on their own behalf singly or jointly and who made the original nomination. On cancellation of the nomination shall stand rescinded and the Mutual Fund, the Trustee and the AMC shall not be under any obligation to transmit the Units in favour of the nominee.

The nomination facility extended under the Scheme is in accordance with the SEBI Regulations and subject to other applicable laws. Transmission of the Units in the name of the nominee shall discharge the Mutual Fund, the Trustee and the AMC from any liability towards the successor(s)/heir(s) of the deceased Unitholder(s). However, the Mutual Fund / Trustee / AMC may request the nominee to execute suitable indemnities in favour of the Mutual Fund and / or the Trustee and / or the AMC, and to submit necessary documentation to the satisfaction of the Mutual Fund before transmitting Units to his / her favour. Nominations received in the form prescribed by the AMC alone shall be valid.

Further, if either the Mutual Fund and/or the Trustee and/or the AMC incur any loss whatsoever arising out of any litigation or harm that it may suffer in relation to the nomination, they will be entitled to be indemnified absolutely from the deceased Unitholders' estate.

Investors / Unitholders are advised to read the instructions carefully before nominating.

TRANSFER & TRANSMISSION FACILITY

The Mutual Fund will be repurchasing Units on an ongoing basis and hence the transfer facility is found redundant. However, if a person becomes a holder of the Units by operation of law or upon enforcement of a pledge, then the AMC shall, subject to production of such evidence, which in their opinion is sufficient, proceed to affect the transfer, if such person is otherwise eligible to hold the Units.

Any addition / deletion of name from the folio of the Unitholder are deemed as transfer of Units. In view of the same, additions / deletions of names will not be allowed under any folio of the Scheme. The said provisions in respect of deletion of names will not be applicable in case of death of a Unitholder (in respect of joint holdings) as this is treated as transmission of Units and not transfer.

A person becoming entitled to hold the Units in consequence of the death, insolvency, or winding up of the sole holder or the survivors of joint holders, upon producing evidence and documentation to the satisfaction of the Mutual Fund and/or the Trustee and/or the AMC and upon executing suitable indemnities in favour of the Mutual Fund and/or the Trustee and/or the AMC, shall be registered as a Unitholder.

LIEN ON UNITS

In case the Subscription money is not realized, the transaction shall be reversed and the Units allotted (if any) shall be cancelled, and a fresh Account Statement/ Confirmation slip shall be dispatched to the Unitholder. For Non-Individuals and NRI’s the Mutual Fund may mark a lien on Units in case documents, which need to be submitted, are not given in addition to the application form before the submission of Redemption / Repurchase request.

However, the Trustee / AMC reserve the right to change operational guidelines for lien on Units from time to time.

PLEDGE OF UNITS

The Units under the Scheme may be offered as security by way of a pledge / charge in favour of scheduled banks, financial institutions, non-banking finance companies (NBFCs) or any other institution, subject to any rules / restrictions that the AMC may prescribe from time to time. The ISC will note and record such pledged / charged Units. A standard form for this purpose is available on request from any of the ISCs. The ISC shall mark a lien only upon receiving the duly completed form and documents as it may require. Disbursement of such loans will be at the entire discretion of the bank / financial institution / NBFC or any other body concerned and the Mutual Fund assumes no responsibility thereof. The Trustee / AMC retains the sole and absolute discretion to reject any application for pledge of units.

The Unitholder will not be able to redeem/switch Units that are pledged/charged until the entity to which the Units are pledged/charged provides written authorisation to the Mutual Fund that the lien may be removed. As long as Units are pledged / charged, the Pledgee / Chargeholder will have complete authority to redeem such Units. The AMC reserves the right to discontinue this facility.

SALE OF UNITS ON AN ONGOING BASIS

The Scheme will offer for Sale of Units on every Business Day on an ongoing basis commencing from not later than 30 days from the closure of New Fund Offer Period. Units of the Scheme would be available at Applicable NAV, subject to the applicable Sales Load, if any, on any Business Day from the ISCs given in the inside back cover of the Offer Document.

The Trustee / AMC reserves the right to change operational guidelines for various service related issues including lien, nomination, transmission, pledge, client identification and verification requirements from time to time. The AMC reserves the right to request the Unitholder(s)/ Investor(s) to submit notarised/ attested copies of necessary deeds/ documents to the satisfaction of the AMC against such investor’s requests.

Subscriptions on an ongoing basis will be made only by specifying the amount to be invested and not the number of Units to be subscribed. The total number of Units allotted will be determined with reference to the applicable Sale Price and fractional Units may be created. Fractional Units will be computed and accounted for upto three decimal places and they will in no way affect an investor's ability to redeem Units. The Trustee / AMC reserves the right to change the basis for Subscription from amount basis to any other basis.

ONGOING SALE PRICE

The Sale Price of the Units on an ongoing basis is based on the Applicable NAV and Sales Load, if any.

If the Applicable NAV is Rs. 10.00; Entry Load is 6 percent, then the Sale Price will be calculated as follows:

As per SEBI Regulations, while determining the prices of the units, the Mutual Fund shall ensure that the Repurchase Price is not lower than 93% of the Net Asset Value and the Sale Price is not higher than 107% of the Net Asset Value. Provided further that the difference between the repurchase price and the sale price of the unit shall not exceed 7% calculated on the sale price.

APPLICABLE NAV FOR SALE OF UNITS

Applicable NAV in respect of an application for Sale which is received upto 3.00 p.m. on a Business Day (subject to it being complete in all respects) will be the NAV of the respective Option as at the close of that Business Day, subject to Sales Load, if any. When an application for Sale is received after the cut off time specified above or on a Non-Business Day, the request will be deemed to have been received on the next Business Day subject to it being complete in all respects. Please refer to "Right to Limit / Withhold Redemptions" on page __ and "Suspension of Sale / Redemption / Switching Options of the Units" on page __.

However, in respect of valid applications accompanied with demand drafts, which is not payable at par at the place where the application is received, if accepted as a mode of payment, the closing NAV of the Business Day on which demand draft is credited into the account of ABN AMRO Mutual Fund shall be applicable.

REDEMPTION OF UNITS

The Units can be redeemed (i.e. sold back to the Mutual Fund) on or Switched out (i.e. to another scheme of the Mutual Fund or Option(s) offered within the Scheme, if any) every Business Day, at the Applicable NAV subject to applicable Exit Load, if any.

The Redemption request can be made on a pre-printed form or by using the relevant tear off section of the Transaction Slip enclosed with the Account Statement, which should be submitted at/may be sent by mail to the ISCs given in the inside back cover of the Offer Document.

In case the Units are held in the names of more than one Unitholder, where mode of holding is specified as "Joint", Redemption requests will have to be signed by all the joint holders. However, in cases of holding specified as “Anyone or Survivor”, any of one the Unitholders will have the power / authority to make Redemption request, without it being necessary for all the Unitholders to sign. However, in all cases, the Redemption proceeds will be paid only to the first named of such remaining Unitholder.

MINIMUM AMOUNT / UNITS FOR REDEMPTION

The Redemption would be permitted to the extent of credit balance in the Unitholder's account. The Redemption request can be made by specifying the rupee amount or by specifying the number of Units of the Scheme to be redeemed. If a Redemption request is for both, a specified rupee amount and a specified number of Units of the Scheme, the specified number of Units will be considered the definitive request. If the Unitholder specifies only the Redemption amount, the AMC will divide the Redemption amount so specified by the Redemption Price to arrive at the number of Units. The request for Redemption of Units could also be in fractions, upto three decimal places.

The minimum amount of Units for Redemption / Switch out for the Scheme is Rs.1000 or a minimum of 100 Units (unless redemption request is for all units).

The investor is entitled to redeem the entire balance of his Units held in the Scheme, regardless of the minimum amount / Units mentioned above. The minimum amount of Redemption may be changed in future by the Trustee / AMC for the Scheme. If the balance in the account of the Unitholder does not cover the amount of Redemption request, then the Mutual Fund is authorised to close the account of the Unitholder and send the entire such (lesser) balance to the Unitholder.

Investors are requested to note that as per the prevailing tax laws, Unit holders would be liable to pay securities transaction tax during repurchase of their units under the Scheme. The Redemption price / units will be calculated taking into account the said transaction tax.

REDEMPTION PRICE

The Redemption Price of the Units, on an ongoing basis, is based on the Applicable NAV and subject to applicable Exit Load, if any.

If the Applicable NAV is Rs.15 and a 1% Exit Load is charged, the Redemption Price will be calculated as follows:

APPLICABLE NAV FOR REDEMPTION OF UNITS

Applicable NAV in respect of an application for Redemption which is received before 3.00 p.m. on a Business Day (subject to it being complete in all respects) will be the NAV of the respective Option as at the close of that Business Day, subject to applicable Exit Load, if any. When an application for Redemption is received after the cut off time specified above or on a Non-Business Day, then the request will be deemed to have been received on the next Business Day subject to it being complete in all respects. Please refer to "Right to Limit / Withhold Redemptions" on page __ and "Suspension of Sale / Redemption / Switching Options of the Units" on page __.

PAYMENT OF REDEMPTION PROCEEDS

(a) Unitholders having a bank account with certain banks with whom the AMC would have an arrangement from time to time, the Redemption / dividend proceeds shall be directly credited to their account. As per the SEBI Regulations, the Mutual Fund shall despatch Redemption proceeds within 10 Business Days from the date of acceptance of the Redemption request. However, under normal circumstances, the Mutual Fund will endeavour to credit the first/sole Unitholder's account with the Redemption proceeds within 4 Business Days from the date of acceptance of the Redemption request.

(b) For other Unitholders not covered by (a) above and Unitholders covered by (a) but have given specific request for Cheque :

Redemption proceeds will be paid by cheque and payments will be made in favour of the Unitholder (registered holder of the Units or, if there is more than one registered holder, only to the first registered holder) with bank account number furnished to the Mutual Fund. Redemption proceeds will be sent to the Unitholders address (or, if there is more than one holder on record, the address of the first-named Unitholder).

BANK DETAILS

In order to protect the interest of Unitholders from fraudulent encashment of cheques, the current SEBI Regulations, has made it mandatory for investors to mention in their Application / Redemption request, their bank name and account number. Any application form without these details shall not be accepted. The normal processing time may not be applicable in situations where such details are not provided by Investors / Unitholders. The AMC will not be responsible for any loss arising out of fraudulent encashment of cheques and / or any delay / loss in transit.

REDEMPTION BY NRIs / FIIs

RBI has vide Schedule 5 of the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000, granted general permission to NRIs and FIIS who have purchased units issued by mutual funds, to tender units to the mutual funds for repurchase or for the payment of maturity proceeds. Payment of Redemption proceeds to NRIs / FIIs Unitholders will be subject to the relevant rules/regulations /guidelines of RBI as are applicable from time to time (subject to deduction of tax at source as applicable).

The Redemption proceeds shall be credited to the NRI investor's NRO account, where the payment for the purchase of the Units redeemed was made out of funds held in NRO account

(i) In the case of NRI the Redemption proceeds shall be remitted abroad or at the NRI investor's option, credited to the NRE / FCNR account where the payment for the purchase of Units redeemed was made by inward remittance through normal banking channels or out of funds held in NRE / FCNR account.

(ii) In the case of FIIs, the Redemption proceeds shall be remitted abroad or credited to the Non-Resident Rupee Account of the FII maintained with the designated branch of an authorised dealer in accordance with the relevant exchange management regulations.

IDENTIFICATION DOCUMENTS

The requisite identification documents should be submitted along-with the application form for subscription of units such as certified copy of resolution, list of authorised signatories, a certified copy of the Memorandum & Articles of Association and / or bye-laws and / or Trust Deed and / or Partnership Deed and certificate of registration or any other document, as the case may be, then the same shall be submitted by the said investor along-with the application. In case where the required documents are not submitted by the investor at the time of making the application, the AMC/Trustee/Mutual Fund reserves the right to withhold the redemption request / reject the application of the said investor till the required documents are received by the AMC/Trustee/Mutual Fund/its Agents from the said investor. The AMC/Trustee/Mutual Fund shall not be responsible in any manner whatsoever for any losses/damages caused to the investor as result of the AMC/Trustee/Mutual Fund/its Agents withholding the redemption request of the said investor till the required documents are received by the AMC/Trustee/Mutual Fund from the said investor.

EFFECT OF REDEMPTIONS

The Unit capital and reserves will stand reduced by an amount equivalent to the product of the number of Units redeemed at the Applicable NAV. Units once redeemed will be extinguished and will not be re-issued.

RIGHT TO LIMIT / WITHHOLD REDEMPTION

The Trustee / AMC may, in the general interest of the Unitholders of the Scheme, keeping in view the unforeseen circumstances / unsure conditions, limit the total number of Units which may be Redeemed on any Business Day to 5% of the total number of Units then in issue under the Scheme (or such higher percentage as the Trustee / AMC may decide in any particular case). In addition, the Trustee / AMC reserves the right, in its sole discretion, to limit Redemptions with respect to any single account to an amount of Rs. 2 crore or such other lower / higher amount decided by the Trustee / AMC, on a single Business Day. Any Units which by virtue of these limitations are not Redeemed on a particular Business Day will be carried forward for Redemption to the next Business Day, in order of receipt. Redemptions so carried forward will be priced on the basis of the Redemption Price of the Business Day on which Redemption is made. Under such circumstances, to the extent multiple Redemption requests are received at the same time on a single Business Day, Redemption will be made on pro-rata basis, based on the size of each Redemption request, the balance amount being carried forward for Redemption to the next Business Day(s).

In case a Unitholder makes a Redemption request immediately after Subscription of Units, the Redemption proceeds will not be dispatched until Subscription moneys are realized by the Mutual Fund and the proceeds have been credited to the Scheme's Account. However, this is only applicable if the value of Redemption is such that some or all of the freshly purchased Units may have to be redeemed to effect the full Redemption.

Investors may note that under the following circumstances the Trustee / AMC may at its sole discretion (and without being responsible and/or liable in any manner whatsoever) freeze/seize a Unitholder's account (or deal with the same in the manner the Trustee / AMC is directed and/or ordered) under a Scheme:

· Under the direction and/or order (including interim orders) of any regulatory/statutory authority or any judicial authority or any quasi-judicial authority or such other competent authority having the powers to give direction and/or order.

IMPORTANT NOTE ON ANTI MONEY LAUNDERING, KNOW-YOUR-CUSTOMER AND INVESTOR PROTECTION:

The investors should ensure that the amount invested in the scheme is through legitimate sources only and does not involve and are not designed for the purpose of any contravention or evasion of any Act, Rules, Regulations, Notifications or Directions of the provisions of Income Tax Act, Anti Money Laundering Act, Anti Corruption Act and or any other applicable laws enacted by the Government of India from time to time.

The AMC is committed to complying with all applicable anti money laundering law and regulation in all of its operations. The AMC recognises the value and importance of creating a business environment that strongly discourages money launderers from using the mutual funds route. To that end, certain policies have been adopted by the AMC.

The Government of India has put a legal and policy framework to combat money laundering through the Prevention of Money Laundering Act, 2002 (PMLA 2002). PMLA 2002 and the Rules notified thereunder (PMLA Rules) came into effect from July 1, 2005. Director, FIU-IND and Director (Enforcement) have been conferred with exclusive and concurrent powers under relevant sections of the Act to implement the provisions of the Act.

Consequently, the Securities And Exchange Board of India (SEBI) has mandated that all registered intermediaries including mutual funds to formulate and implement a comprehensive policy framework on anti money laundering and adopt ‘Know Your Customer’ (KYC) norms.

In order to make the data capture and document submission easy and convenient for the investors, Mutual Fund Industry has collectively entrusted this responsibility of collection of documents relating to identity and address and record keeping to an independent agency (presently CDSL Ventures Limited) that will act as central record keeping agency (‘CVL’).

To take initiative forward on policy frameworking w.r.t KYC & Anti money laundering implementation ABN AMRO Mutual Fund has laid down following procedure:

For all investments in any of the schemes of ABN AMRO Mutual Fund, quoting of PAN (Permanent Account Number) as well as providing of KYC confirmation from CVL will be mandatory for any investments.

AMC reserves the right to validate the KYC Compliance & PAN with the records of CVL, income tax database; as the case may be either before allotting the units or subsequently.

AMC further reserves the right to refund the investments made, subsequently if it is found that a valid KYC confirmation is not provided & valid PAN is not quoted on such application(s). Such refund will be within a reasonable time at applicable NAV, subject to payment of exit load, wherever applicable.

The investments or redemptions will be made from/to domestic accounts i.e. accounts within Indian Banking system. Investors should make subscription of units of the Fund in their own name and through their own bank accounts only and no third party subscription will be allowed.

In addition to providing the redemption bank mandate, it is mandatory for applicants to mention their Bank Account number, instrument number and the Bank name from which the subscription is funded, in their each Subscription request.

AMC reserves the right to reject the application in case the application is not completed to the above effect.

To ensure appropriate identification of the investor and with a view to monitor transactions for the prevention of money laundering, the AMC reserves the right to: (a) scrutinise and verify the identity of the investor, unit holder, person making the payment on behalf of the investor and the source of the funds invested, to be invested in the Mutual Fund; (b) ask for the additional information to substantiate the source of investments is genuine and also reserves the right to reject the application/ redeem the investments within reasonable time at applicable NAV subject to loads in case AMC finds the mismatch in the Subscription Bank and the redemption Bank Mandate, (either on ongoing basis or in respect of the past transactions of the investors (c) reject any application, prevent further transactions by a unit holder; (d) to mandatorily redeem the units held by the unit holder at the applicable NAV prevalent at the time of such redemption and (e) reject the transaction / redemption / freeze or seize Unitholder's account if the AMC has a reasonable ground to do so (f) and report the relevant details to the competent authority and take such other actions as may be required to comply with the applicable law as the AMC/ Mutual Fund/ Trustees may deem proper at their sole option.

The AMC may share investor’s personal information with any organisation for compliance with any legal or regulatory requirements or to verify the identity of investors for complying with anti-money laundering requirements.

CLOSURE OF UNITHOLDERS' ACCOUNT / MANDATORY REDEMPTION OF UNITS

Investors may note that the Trustee / AMC at its sole discretion may close a Unitholder's account under the Scheme after giving notice of 30 days, if at the time of any part Redemption, the value of balance Units (represented by the Units in the Unitholder's account if such Redemption / Switch were to take place, valued at the Applicable NAV), falls below an amount of Rs. 5,000/- under the Plan/ Option(s) or such other amount determined by the AMC / Trustee from time to time.

As Units may not be held by any person in breach of the SEBI Regulations, any law or requirements of any governmental, statutory authority including, without limitation, exchange control regulations, the Mutual Fund / Trustee / AMC may mandatorily redeem all the Units of any Unitholder where the Units are held by a Unitholder in breach of the same.

The Mutual Fund / Trustee / AMC may redeem Units of any Unitholder in the event it is found that the Unitholder has submitted information either in the application or otherwise that is false, misleading or incomplete.

SUSPENSION OF SALE / REDEMPTION / SWITCHING OPTIONS OF THE UNITS

The Mutual Fund at its sole discretion reserves the right to withdraw Sale and / or Redemption or Switching of the Units in the Scheme (including any one of the Option of the Scheme) temporarily or indefinitely, if in the opinion of the Trustee / AMC the general market conditions are not favourable and / or suitable investment opportunities are not available for deployment of funds due to any circumstances. However, the suspension of Sale / Redemption / Switching either temporarily or indefinitely will be with the approval of the Boards of the AMC and the Trustee. The approval from the Boards of the AMC and the Trustee giving details of circumstances and justification for the proposed action shall also be informed to SEBI in advance.

The Sale, Redemption and Switching of the Units may be temporarily suspended under the following conditions:

1. When one or more stock exchanges or markets, which provide basis for valuation for a substantial portion of the assets of the Scheme are closed otherwise than for ordinary holidays.

2. When, as a result of political, economic or monetary events or any circumstances outside the control of the Trustee and the AMC, the disposal of the assets of the Scheme are not reasonable, or would not reasonably be practicable without being detrimental to the interests of the Unitholders.

3. In the event of breakdown in the means of communication used for the valuation of investments of the Scheme, without which the value of the securities of the Scheme cannot be accurately calculated.

4. During periods of extreme volatility of markets, which in the opinion of the AMC are prejudicial to the interests of the Unitholders of the Scheme or due to any changes in regulatory framework, market development, when continuing with Sale/ Purchases/ switching may or may not be in the interest of investors .

6. In the event of any force majeure or disaster that affects the normal functioning of the AMC or the ISC or Registrar and Transfer Agent.

The Trustee / AMC reserves the right in its sole discretion to withdraw the facility of Sale and Switching Option of Units into and out of the Scheme, temporarily or indefinitely, if AMC views that changing the size of the corpus may prove detrimental to the existing Unit holders of the Scheme. In the above eventualities, the time limits indicated, for processing of requests for Subscription and Redemption of Units will not be applicable.

SECTION IV

LOAD STRUCTURE & RECURRING EXPENSES

EXPENSES OF THE SCHEME

The information provided under this Section seeks to assist the investor in understanding the expense structure of the Scheme, fees / expenses and their percentage the investor is likely to incur on purchasing and selling the Units of the Scheme.

a) Unitholder Transaction Expenses and Load

Exit load : 1% if redeemed / switched out within 6 months from date of investment.

It may be noted that no load will be charged in case of switches between equity Schemes of ABN AMRO Mutual Fund.

No entry/exit load will be charged in case of investment made by Fund-of- Funds Schemes launched by Mutual Funds in ABN AMRO China Equity Fund.

The load structure is subject to change from time to time and such changes shall be implemented prospectively. The Mutual Fund shall ensure that the Redemption Price is not lower than 93% of the NAV and the Sale Price is not higher than 107% of the NAV, provided that the difference between the Redemption Price and Sale Price of the Unit shall not exceed the permissible limit of 7% of the Sale Price, as provided for under the SEBI Regulations.

The Unitholder transaction expenses and loads set forth above are subject to change at the discretion of the AMC / Trustee and such changes shall be implemented prospectively.

Subject to the SEBI Regulations, the AMC / Trustee reserve the right to modify / alter the exit load structure on the Units subscribed / redeemed on any Business Day under each Plan(s) / Option(s). Such changes will be applicable for prospective investments. The AMC / Trustee shall arrange to display a notice in the Investor Service Centres of the AMC and distributors / brokers office, before the change of the then prevalent exit load structure. The Addendum detailing the changes in exit load structure will be attached to Offer Documents and Abridged Offer Documents. The Addendum will also be circulated to all the distributors / brokers so that the same can be attached to all the Offer Documents and Abridged Offer Documents in stock. This Addendum will also be sent along with the newsletter to the Unitholders immediately after the changes. Changes in the exit load structure may be stamped in the acknowledgement slip issued by the Mutual Fund after the changes in exit load structure. The changes may also be disclosed in the Statements of Account issued after the introduction of such exit load. The exit Load collected from the Unitholders under each Plan / Option will be credited to a separate account in the Scheme accounts and will be offset against selling, distribution and marketing expenses in accordance with the SEBI Regulations. Surplus of exit Load, if any, charged over planned selling, distribution and marketing expenses to be defrayed will be credited to the Scheme whenever felt appropriate by the AMC.

b) Initial Issue Expenses

In accordance with the guidelines issued by SEBI, ABN AMRO China Equity Fund being an open-ended Scheme would meet the sales, marketing and other such expenses connected with Sales and distribution of the Scheme from the entry load, if any and not through initial issue expenses.

Out of Rs.100/- (Rupees One Hundred Only) subscribed by the investor in the Scheme in the New Fund Offer Period, the minimum amounts available for investment by the Scheme and impact on the NAV on the first day of declaration of NAV is illustrated below will be as follows:

For illustrating the impact on NAV, no accruals, appreciation or depreciation on Investments have been

· The impact of Entry/Exit load during the Continuous Offer has not been considered for calculation of Purchase/ Redemption Price on first date of NAV computation.

· Amortisation of Annual Recurring Expenses starts from the date of computation of NAV, which could be earlier than the first day of declaration of NAV.

c) Annual Scheme Recurring Expenses

The AMC has estimated the annual recurring expenses under the Scheme as per the table below:

The purpose of the above table is to assist the investor in understanding the various costs and expenses that an investor in the Scheme will bear directly or indirectly. The above expenses are subject to change and may increase / decrease as per actual and / or any change in the SEBI Regulations and the AMC reserves the right to change (increase/decrease) the expenses charged to each Scheme, subject to the applicable SEBI Regulations. As per the SEBI Regulations, the maximum recurring expenses including the investment management and advisory fee that can be charged to the Scheme shall be subject to a percentage limit of average daily net assets as given in the table below. Expenses over and above the prescribed ceiling will be borne by the AMC.

As per the Investment Management Agreement and the SEBI Regulations, the AMC is entitled to an Investment Management and Advisory fee at the rate of 1.25% per annum of the daily average net assets outstanding in each accounting year for the Schemes, as long as the net assets do not exceed Rs. 100 crore and 1.00% of the excess amount over Rs. 100 crore, where net assets so calculated exceed Rs. 100 crore.

FEES AND EXPENSES OF THE PAST SCHEMES AND CONDENSED FINANCIAL INFORMATION

Under the SEBI Regulations, the Mutual Fund is entitled to charge initial issue expenses upto a maximum of 6% of the initial resources raised under the Scheme. The Mutual Fund has launched following schemes in the past viz., AAEF, AAMIP, AAFDF, AAFRF, AACF, AAOF, AADYF, AAMPF, AATAP, AAFTP-1, AAFTP-2:QA, AAFTP-2:TM, AAFTP-2:QB, AAFLF, AAMMF, AAMMF – 2A, AAMMF – 3, AAFTP-2:QC, AAFTP-2:QD, AAFTP-2:HYA, AAFTP-2:QPE, AAFTP-3:QPA, AAFTP-3:QPB, AAFTP-3:QPC, AAFTP-3:YP, AAFTP-3:QPD, AAFTP-3:QPE, AAFTP-3:QPF, AAFTP-3:QPG, AAFTP-3:QPH, AAFTP-4:QPA, AAFTP-4:QPB, AAFTP-4:QPC, AAFTP-4:QPD, AADAF, AAFTP-4:QPE, AAFTP-4:HYA, AAFTP-4:16M, AAFTP-4:17M, ,AAFTP-5: QPA, AAFTP-5: 13M, AAFTP-5: 14M, AAFTP-6: QPB, AAFTP-6: QPC, AAFTP-6: QPD, AAFTP-7: QPA, AAFTP-7: QPB, AAFTP-7: QPC, AAFTP-7: QPD, AASDF, AAFSTP-A and AAFSTP-B.

The Initial Issue expenses for AAMIP, AAFDF, AACF, AAMPF, AAFTP-1, AAFTP-2:TM, AAFLF, AAMMF, AAMMF – 2A, AAMMF – 3, AAFTP-3:YP, AAFTP-4:QPA, AAFTP-4:QPB, AAFTP-4:QPC, AAFTP-4:QPD, AAFTP-4:QPE, AAFTP-4:HYA, AAFTP-4:16M, AAFTP-4:17M, ,AAFTP-5: QPA, AAFTP-5: 13M, AAFTP-5: 14M, AAFTP-6: QPB, AAFTP-6: QPC, AAFTP-6: QPD, AAFTP-7: QPA, AAFTP-7: QPB, AAFTP-7: QPC, AAFTP-7: QPD, AASDF, AAFSTP-A and AAFSTP-B. were borne by the AMC. In case of AAEF, the entry load collected during the initial offer period amounting to Rs. 7.58 Crores, was utilised to meet the Initial Issue expenses incurred on selling, distribution and marketing expenses of AAEF. The remainder of the total initial issue expenses was borne by the AMC. The Initial Issue expenses met from the Entry Load collected were within 6% of the mobilisation. As the initial issue expenses in case of AAMIP, AAFDF, AACF, AAMPF, AAFTP-1, AAFTP-2:TM, AAFLF, AAMMF, AAMMF – 2A, AAMMF – 3, AAFTP-3:YP, AAFTP-4: QPA, AAFTP-4:QPB, AAFTP-4:16M, AAFTP-4:17M, ,AAFTP-5: QPA, AAFTP-5: 13M, AAFTP-5: 14M, AAFTP-6: QPB, AAFTP-6: QPC, AAFTP-6: QPD, AAFTP-7: QPA, AAFTP-7: QPB, AAFTP-7: QPC, AAFTP-7: QPD, AAFSTP-A and AAFSTP-B were not charged to the Schemes, the comparison of ‘actual expenses’ and ‘estimated expenses’ for these Schemes are not disclosed.

In case of AAOF, AADYF, AATAP and AAFLF the break-up of Initial Issues Expenses charged to Scheme is as follows:

· In case of AAOF, out of the entry load collected during the initial offer period amounting to Rs. 7.16 Crores, an amount of Rs.5.32 Crores was utilised to meet the Initial Issue expenses incurred on Commission to Agents/Brokers.

· In case of AADYF, out of the entry load collected during the initial offer period amounting to Rs. 5.71 Crores, an amount of Rs.4.38 Crores was utilised to meet the Initial Issue expenses incurred on selling and distributions expense and payment of Commission to Agents/Brokers.

· The initial issue expenses of the above schemes did not vary adversely from the estimated expenses of the Schemes, on an overall basis.The initial issue expenses of the above schemes did not vary adversely from the estimated expenses of the Schemes, on an overall basis.

	AACF
	Period ended November 05,2007	2007	2006	2005
NAV at the beginning of the year*				N.A.
Growth
Dividend
Monthly Dividend
Quarlterly Dividend
Regular Growth	11.4517	10.7769	10.2598
Regular Dividend
Regular Daily Dividend
Regular Weekly Dividend	10.0039	10.0014	10.0000
Regular Monthly Dividend	10.0043	10.0459
Regular Quarterly Dividend
Regular Half-yearly Dividend
Regular Half-yearly Dividend
Institutional Growth	11.5820	10.8607	10.2866
Institutional Daily Dividend	10.0013	10.0000	10.0000
Institutional Weekly Dividend
Institutional Monthly Dividend	10.0045	10.0521
Instituional Quarterly Dividend
Institutional plus Growth	10.9879	10.2857
Institutional plus Daily Dividend	10.0013	10.0000
Institutional plus Weekly Dividend		10.0017
Institutional plus Monthly Dividend		10.0554
Dividend Option With Compulsory Dividend Reinvestment
Dividend On Maturity Option
Institutional Dividend On Maturity Option
Regular Plan - Dividend Re-investment Option


Net Income per units (Rs.)	0.2552	1.3916	0.6636	0.3342


Dividends paid per unit
Dividend-(Individual / HUF) (Rs. Per unit)
Dividend- (Others) (Rs. Per unit)
Regular - Monthly Dividend (Individual / HUF) (Rs. Per unit)	0.24741866	0.53233941	0.03727253	0.22522976
Regular - Montlhy Dividend (Others) (Rs. Per unit)	0.24741866	0.49575303	0.06533813	0.21048726
Regular - Weekly Dividend (Individual / HUF) (Rs. Per unit)	0.25132165	0.52968087	0.43029825	0.22671486
Regular - Weekly Dividend (Others) (Rs. Per unit)	0.25132165	0.49327729	0.40072451	0.21201180
Insitutional - Daily Dividend (individual / HUF) (Rs.per unit)	0.26785985	0.56265695	0.47633751	0.24186475
Insitutional - Daily Dividend (Others) (Rs. Per unit)	0.26785980	0.52405903	0.44359997	0.23374839
Insitutional - Weekly Dividend (individual / HUF) (Rs.per unit)		0.20234741
Insitutional - Weekly Dividend (Others) (Rs. Per unit)		0.38236576
Insitutional - Monthly Dividend (individual / HUF) (Rs.per unit)	0.25910774	0.56347292	0.08331506
Insitutional - Monthly Dividend (Others) (Rs. Per unit)	0.22014417	0.52474681	0.28631938
Insitutional - Quarterlyly Dividend (individual / HUF) (Rs.per unit)
Insitutional - Quarterlyly Dividend (Others) (Rs. Per unit)
Insitutional Plus - Daily Dividend (individual / HUF) (Rs.per unit)	0.07270797	0.01859359	0.02584129
Insitutional Plus - Daily Dividend (Others) (Rs. Per unit)	0.27586201	0.53806368	0.22982733
Insitutional Plus - Weekly (individual / HUF) (Rs.per unit)		-	-
Insitutional Plus - Weekly (Others) (Rs. Per unit)		0.51652478	0.03875578
Insitutional Plus - Monthly Dividend (individual / HUF) (Rs.per unit)		-
Insitutional Plus - Monthly Dividend (Others) (Rs. Per unit)		0.43776541	0.22825425

Transfer to reserves (Rs.In Lakhs)				480.51

NAV at the end of the period
Regular Growth	11.8328	11.4502	10.7769	10.2598
Regular Weekly Dividend	10.0088	10.0026	10.0014	10.0000
Regular Monthly Dividend	10.0150	10.0029	10.0459
Institutional Growth	11.9852	11.5804	10.8607	10.2866
Institutional Daily Dividend	10.0000	10.0000	10.0000	10.0000
Institutional Monthly Dividend	10.0153	10.0032	10.0521
Institutional Quarterly Dividend
Institutional plus Growth	10.0789	10.9864	10.2857
Institutional plus Daily Dividend	10.0000	10.0000	10.0000
Institutional plus Weekly Dividend	-		10.0017
Institutional plus Monthly Dividend			10.0554

Date of Allotment	02/09/2004	02/09/2004	02/09/2004	02/09/2004

Name of Benchmark Index	Crisil Liquid fund Index

CAGR
Growth
Regular - Growth (%)	5.44%	5.39%	4.86%	2.60%^
Institutional - Growth (%)	5.86%	5.86%	5.37%	2.87%^
Institutional Plus Plan - Growth	0.38%	6.50%	2.86%^

Benchmark Index Returns (%)	5.79%	5.32%	4.66%	2.47%^
	6.46%	5.92%	2.44%^
^Absolute

Net Assets end of the year end (Rs. Crs)	433.50	401.95	849.17	427.91

Ratio of Recurring Expenses to net assets
Regular Plan	0.75%	0.76%	0.95%	0.82%
Instituional Plan	0.50%	0.39%	0.42%	0.40%
Instituional Plus Plan	0.35%	0.22%	0.24%

	AAFRF
	Period ended November 05,2007	2007		2006		2005
NAV at the beginning of the year*						N.A.
Regular Growth	11.4406	10.7749		10.2605
Regular Weekly Dividend	10.0020	10.0015
Regular Monthly Dividend	10.0024	10.0448		10.0030
Institutional Growth	11.5664	10.8526		10.2817
Institutional Daily Dividend	10.0000	10.0000		10.0000
Institutional Monthly Dividend	10.0023	10.0504		10.0036
Institutional plus Growth		10.2817

Net Income per units (Rs.)	0.2342	4.2276		0.9520		0.3032

Dividends paid per unit
Regular - Monthly Dividend (Individual / HUF) (Rs. Per unit)	0.26845899	0.52707736		0.36159725
Regular - Montlhy Dividend (Others) (Rs. Per unit)	0.26845899	0.49085265		0.33983837
Regular - Weekly Dividend (Individual / HUF) (Rs. Per unit)	0.27176488	0.52554129		0.18754549
Regular - Weekly Dividend (Others) (Rs. Per unit)	0.27176488	0.48942144		0.19319789
Insitutional - Daily Dividend (individual / HUF) (Rs.per unit)	0.28716477	0.55860792		0.48241492		0.24554072
Insitutional - Daily Dividend (Others) (Rs. Per unit)	0.28716448	0.52027412		0.44925966		0.22961520
Insitutional - Weekly Dividend (individual / HUF) (Rs.per unit)	0.03938964	0.26119022
Insitutional - Weekly Dividend (Others) (Rs. Per unit)	-	0.07586713
Insitutional - Monthly Dividend (individual / HUF) (Rs.per unit)	0.26495226	0.56084191		0.39860772		0.11906252
Insitutional - Monthly Dividend (Others) (Rs. Per unit)	0.10052601	0.16742893		0.37464881		0.19389441
Insitutional Plus - Daily Dividend (individual / HUF) (Rs.per unit)	0.07909369	0.02312098
Insitutional Plus - Daily Dividend (Others) (Rs. Per unit)	0.14524194	0.33014491		0.22538626
Insitutional Plus - Weekly (Others) (Rs. Per unit)	-	0.11144757

Transfer to reserves (Rs.In Lakhs)						177.72

NAV at the end of the period
Regular Growth	11.8526	11.4406		10.7749		10.2605
Regular Dividend
Regular Daily Dividend
Regular Weekly Dividend	10.0070	10.0020		10.0015
Regular Monthly Dividend	10.0125	10.0024		10.0448		10.0030
Regular Quarterly Dividend
Regular Half-yearly Dividend
Regular yearly Dividend
Institutional Growth	12.0032	11.5664		10.8526		10.2817
Institutional Daily Dividend	10.0000	10.0000		10.0000		10.0000
Institutional Weekly Dividend	-
Institutional Monthly Dividend	10.0132	10.0023		10.0504		10.0036
Institutional Quarterly Dividend
Institutional plus Growth	10.0621			10.2817
Institutional plus Daily Dividend	10.0000

Date of Allotment	13/09/2004	13/09/2004		13/09/2004		13/09/2004

Name of Benchmark Index	Crisil Liquid fund Index

CAGR
Growth
Regular - Growth (%)	5.55%		5.42%		4.94%		2.60%^
Institutional - Growth (%)	5.97%		5.88%		5.43%		2.82%^
Institutional Plus Plan - Growth					2.82%^

Benchmark Index Returns (%)	5.81%		5.35%		4.69%		2.36%^
					2.44%^
^Absolute

Net Assets end of the year end (Rs. Crs)	100.89		47.26		252.88		353.82

Ratio of Recurring Expenses to net assets
Regular Plan	0.75%		0.77%		0.95%		0.80%
Instituional Plan	0.50%		0.38%		0.42%		0.42%
Instituional Plus Plan	0.47%		0.19%		0.29%

	AAFDF
	Period ended November 05,2007	2007	2006	2005
NAV at the beginning of the year*				N.A.
Regular Growth	11.5956	10.6264	10.1283
Regular Dividend
Regular Daily Dividend	10.0026	10.0001
Regular Weekly Dividend	10.0055	10.0001
Regular Monthly Dividend
Regular Quarterly Dividend	10.0818	10.1893	10.0020
Regular Half-yearly Dividend	10.0746	10.2800	10.0024
Net Income per units (Rs.)	0.4797	3.3563	0.4832	0.7464
Dividends paid per unit
Regular - Weekly Dividend (Individual / HUF) (Rs. Per unit)	0.3724	0.7625	0.0387
Regular - Weekly Dividend (Others) (Rs. Per unit)	0.3462	0.7093	0.0505
Regular - Quarterly Dividend (Individual / HUF) (Rs. Per unit)	0.3504	0.7411	0.3947	0.1103
Regular - Quarterly Dividend (Others) (Rs. Per unit)	0.3262	0.6902	0.3676	0.1030
Regular - Half Yearly Dividend (Individual / HUF) (Rs. Per unit)	0.3504	0.7455	0.4035	0.1096
Regular - Half Yearly Dividend (Others) (Rs. Per unit)	0.3261	0.6942	0.3757	0.1021
Regular Daily Dividend (Individual / HUF) (Rs. Per unit)	0.3723	0.7572	0.0821
Regular Daily Dividend (Others) (Rs. Per unit)	0.3455	0.7071	0.0864
Insitutional - Monthly Dividend (individual / HUF) (Rs.per unit)				0.1282
Insitutional - Monthly Dividend (Others) (Rs. Per unit)				0.1199
Insitutional - Quarterlyly Dividend (individual / HUF) (Rs.per unit)

Transfer to reserves (Rs.In Lakhs)				15.21

NAV at the end of the period
Growth
Dividend
Monthly Dividend
Quaterly Dividend
Regular Growth	12.1061	11.5923	10.6264	10.1283
Regular Dividend
Regular Daily Dividend	10.0091	10.0000	10.0001
Regular Weekly Dividend	10.0158	10.0029	10.0001
Regular Monthly Dividend
Regular Quarterly Dividend	10.1191	10.3038	10.1893	10.0020
Regular Half-yearly Dividend	10.1159	10.5217	10.2800	10.0024

Date of Allotment	23/09/2004	23/09/2004	23/09/2004	23/09/2004

Name of Benchmark Index	Crisil Composite Bond Fund Index

SUMMARY OF THE SCHEME - ABN AMRO China Equity Fund -An Open-Ended Equity Scheme investing in Chinese Equities with no assured returns

CONSTITUTION OF THE MUTUAL FUND

THE TRUSTEE

SUMMARY OF THE SUBSTANTIVE PROVISIONS OF THE TRUST DEED

DIRECTORS OF THE TRUSTEE

THE ASSET MANAGEMENT COMPANY

KEY PERSONNEL OF THE AMC AND RELEVANT EXPERIENCE

INVESTMENT OBJECTIVE

CHANGE IN INVESTMENT PATTERN

(a) Liquidity

INVESTMENT APPROACH & RISK CONTROL

Valuation of Derivative Products

INVESTMENT RESTRICTIONS

ACCOUNTING POLICIES & STANDARDS

2. New Fund Offer Period

MINIMUM AMOUNT AND ADDITIONAL AMOUNT FOR APPLICATION

Choice of Plan(s) / Option(s)

DIVIDENDS & DISTRIBUTIONS

DIVIDEND RE-INVESTMENT FACILITY

FACILITIES

Systematic Transfer Plan (STP)

Systematic Investment Plan (SIP)

Systematic Withdrawal Plan (SWP)

Switching Facility

Switch-out from the Scheme is available to investors on the commencement of ongoing Repurchase / Redemption of the Units under the Scheme after the New Fund Offer Period. Please refer ___ for procedure of Redemption/ Repurchase of units

WHO CAN INVEST?

HOW TO APPLY?

PAN requirement with effective from July 2, 2007 upto December 31, 2007

MODE OF PAYMENT

CHEQUE BOUNCING

MODE OF HOLDING

PLEDGE OF UNITS

SALE OF UNITS ON AN ONGOING BASIS

ONGOING SALE PRICE

APPLICABLE NAV FOR SALE OF UNITS

MINIMUM AMOUNT / UNITS FOR REDEMPTION

REDEMPTION PRICE

APPLICABLE NAV FOR REDEMPTION OF UNITS

PAYMENT OF REDEMPTION PROCEEDS

BANK DETAILS

REDEMPTION BY NRIs / FIIs

IDENTIFICATION DOCUMENTS

CLOSURE OF UNITHOLDERS' ACCOUNT / MANDATORY REDEMPTION OF UNITS

SUSPENSION OF SALE / REDEMPTION / SWITCHING OPTIONS OF THE UNITS

SECTION IV

Period Ended November 05, 2007