Information Memorandum - Foresight Group

STAYING INVESTED
Some Investors may wish to stay invested for the longer term to
take advantage of the long-term returns of the Investee Companies.
Each Investor is therefore invited to tell us whether he or she wishes
to exit in years three to four or to stay invested for the longer term.
Each Investor may select this option at any time up to a date to
be notified to Investors by the Fund Manager. Selection may only
be made in writing addressed to the Fund Manager. Any Investors
considering staying invested should seek specialist independent tax
and financial advice before making any such selection.
CHARGES
Initial Fundraising Charges
To ensure Investors benefit from tax reliefs on the full
amount invested, fundraising charges are payable by
Investee Companies rather than by the Fund. The level
of the fundraising charges payable to the Fund Manager
reflects whether or not commission is payable to financial
intemediaries.
In certain limited situations, commission may be paid as described
in more detail below:
Fundraising Charge: 2.5% of Subscription
(no commission payable) payable immediately.
Fundraising Charge: 5.5% of Subscription payable
(commission payable) immediately plus 0.5% pa of
Subscription for 4 years payable annually.
To ensure fairness between Investors different numbers of Shares
will be issued to Investors to reflect the different charge levels that
may be payable in relation to Subscriptions of individual Investors.
Although the amount of the fundraising charges should not
reduce the EIS Relief available to Investors the fundraising charges
payable by an Investor will reduce the value of the Portfolio of
that Investor. Foresight will pay the costs of establishing the
Fund, including legal and taxation costs, the preparation of this
Information Memorandum and any other direct expenses incurred
Annual Fund Management Charges
Foresight intends that Investors should benefit from tax reliefs
on the full amount invested in the Fund. For this reason, the
fund management charges described below (other than the
performance incentive fee) are payable by Investee Companies
rather than by the Fund by reference to the amount invested in
that Investee Company.
The fund management charges will accrue for all Investors
from 31 August 2013, or subsequent date of Subscription
if later, onwards and will be payable quarterly in advance,
with the first payment being on the date of the investment
in the relevant Investee Company. VAT will be added where
applicable.
Any fees and charges that are not paid by Investee Companies
will be recouped from the proceeds of sale of Investments or
dividends received.
Annual management charge 1.75% of the value of
the Portfolio.
Secretarial charge 0.3% of the value of
the Portfolio (subject to
an RPI-linked minimum
of £60,000 in aggregate).
08 FORESIGHT SOLAR EIS FUND 3
Foresight will manage the Investments with the aim of providing
the necessary flexibility consistent with meeting each Investor’s
preference to exit or remain invested for the longer term. Under
certain circumstances, Foresight may be unable to meet the wishes
of Investors to stay invested. For example, if the option to stay
invested is exercised in respect of a relatively small proportion
of the Fund, it may be impractical or uneconomic for the Fund to
continue. Foresight may, therefore, decide to terminate the Fund
and realise and distribute all Investments.
Foresight will bear any legal, accounting and other fees
incurred by the Fund in connection with potential Investments
which do not proceed to completion and may retain for its own
benefit any arrangement fees and directors’ or monitoring fees
which it receives in connection with investments.
Performance Incentive
Foresight will be entitled to a performance incentive fee,
payable from the proceeds of realising Investments. This
fee, which will be deducted from realisation proceeds, is only
payable once Investors have received proceeds of at least £1
per £1 invested in investments. The performance incentive fee
is calculated as 20% of proceeds to Investors in excess of £1
per £1 invested until total proceeds reach 120p per £1 invested,
and 30% thereafter.
Adviser Charges
As part of the new regulations introduced by the FCA (the Retail
Distribution Review), authorised financial intemediary charges for
advising on certain investment products are (in most situations)
to be paid by the client directly rather than via commission from
the product. This amount, for advice provided, is to be agreed by
an Investor and his/her adviser (whether for initial advice and/or
for ongoing management of the relationship between the Investor
and the Fund Manager). An Investor may specify in the Application
Form, the amount of any such charges (upfront and/or ongoing)
he/she has agreed with his/her authorised financial intermediary
in connection with Foresight Solar EIS Fund 3 and request that
Foresight facilitate that payment.
Any sums to be facilitated (upfront or ongoing) will be deducted
from the Subscription. Accordingly only the net amount of the
Subscription will be available to invest through the Fund and
Investors will not obtain EIS Relief on the sums so facilitated.
The amount of any ongoing charges to be facilitated by Foresight
will be deposited in a bank account with Woodside Corporate
Services Limited pending payment to advisers.
Adviser Commission
Authorised financial intermediaries may in certain situations be
permitted to receive commission such as for execution only clients
where no advice or personal recommendation has been given or
for professional clients. In such permitted situations authorised
financial intermediaries will be paid initial commission, usually at
the rate of 3% of Subscriptions, plus annual trail commission at
the rate of 0.5% of Subscriptions for a maximum of four years
(inclusive of VAT). All commission will be paid from fundraising
charges described above.