Voluntary Investment Product (VIP)

1. Voluntary Investment Product (VIP) March 2012

2. General • What is the VIP? • Flexible product where investors can invest discretionary funds (after tax money) • Gives investors access to a wide variety of UTs, MMUT (PSG) and White Label funds via the LISP platform • VIP can only invest in UTs, MMUT (PSG) and White Label Funds, not segregated mandates or PSP

3. Who may invest? Individuals Companies Trusts Retirement Funds Non-taxable organizations

4. Where does it fit in? Platform Offering Investment Pre-retirement Post-retirement Voluntary Investment Endowment Retirement Annuity Preservation Funds Living Annuity Retirement builder Capital Protector Various Unit Trusts as per Portfolio Selection List

5. Pricing Net Asset Value used (NAV) Not the four fund approach as with the life funds Since we are a LISP, we will make use of NAV pricing for most of our investments Where a fund does not have unit trust pricing, life pricing (four fund approach) will be used according to the tax classification (available to RA, ELLA, Pres Funds and Endowments) If there is no unit trust pricing set up or available for an instrument, a client may not invest in that instrument through the VIP

6. Investments Lump sum investment Minimum R50 000 (R20 000 for PSG Konsult & PSG Online) Can be phased in – daily/weekly/monthly phase ins Recurring investments Minimum R500 monthly Monthly, quarterly, half-yearly, yearly Inflation rate CPI / 5% / 10% / 15% / 20% per annum Collection date: Previously only on the 1st of the month, now any day Cheque deposit, EFT, Direct Debit (max R500 000 per day) Once all requirements received and submitted, t+1 for investment to settle

7. Documents Needed PSG Application form (fully completed) Certified copy of client’s ID Certified copy of client’s proof of address (less than three months) Certified copy of client’s proof of bank details (less than three months) Proof of deposit (match to unallocated spreadsheet)

8. Investment Options Unit Trusts Within the VIP – subject to market movements Money Market We only offer PSG Money Market Fund (some clients may be in other Money Market funds due to the acquisition of the Equinox platform, but they are not open for investments)

9. Transfers Unit Transfer from another LISP (same fund, same class) Unit Transfer from a MANCO (same fund, same class)

10. Switches Switch form, fully completed and signed Where a standing instruction exists on the client’s investment, confirm with the client that it will follow the switch t+4 (this can differ based on the type of source and destination fund as well as possible liquidity constraints in the source fund) Internal Switch – Switching of funds at the same Manco External Switch - Switching of funds between different Manco’s (i.e Cash flow) sell units with the one Manco and buy units with another Manco

11. Loans and Surrenders No loans or surrenders Client may repurchase at any time, no restriction

12. Maturity There is no term linked to a VIP, hence no maturity date Client may withdraw at any time

13. Withdrawals No limit on time or frequency Lump-sum or recurring withdrawals Recurring: weekly, monthly, quarterly, half-yearly and yearly Works like an annuity, but it is not an annuity Escalation: same intervals as above Escalation percentage may be selected End date may be stated (client may cancel at any time) Payment date may be any day of the month (consider that the income has to raised on T-5

14. Capital Gains Tax The LISP does not pay tax on behalf of a VIP investor Each investor will pay at his/her own marginal rate, but it is that investor’s responsibility to include the CGT in their tax return, we merely report by means of an IT3c WAC is used as base cost to calculate CGT on unit disposals Example: Purchase 100 units in UT1 at a price of R1 in October 2010 – WAC = 1 (100/1) Purchase 100 units in UT1 at a price of R2 in December 2011 WAC of all units is now (100*1 + 100*2)/200 = R1.50 Dispose of 100 units at price of R3 in January 2012 = (100*3 – 100*1.5) = R150 – I.e. realised gain of R150, investor to include in tax return

15. Dividend Withholding Tax Current rate of 15% on dividends (STC was 10%) Some entities may qualify for exemption - DTD(EX) Foreign investors may qualify for a reduced rate – DTD (RR) It is our responsibility to pay to SARS, hence clients have to let us know if they qualify (we do not give recommendations or advice in terms of DWT)

16. Income tax Income tax is payable on the portion of the interest income paid by UTs and MMUTs Tax on interest income, rental income, foreign sources of income, dividends from property unit trusts

17. Standing Instructions Change Static Details Change Form OR Letter from client instructing change (signed by client or mandated broker) Debit order amount/frequency/escalation Client can switch and confirm how the allocation of the debit order should change, if required Should a regular contribution default for 3 months consecutively, the investment will be treated as “paid up”. The investor may choose to resume payments by informing us in writing.

18. Static Details Change Address / Contact details change Residential Address Signed and completed Change of Static Details form AND Certified proof residential address not older than three months (FICA) Postal Address Signed and completed Change of Static Details form OR Letter from client instructing change Contact Details (email / tel / cell / fax) Signed and completed Change of Static Details form OR Original Letter from client instructing change

19. Static Details Change Bank Details Change Signed and completed Change of Static Details form AND Certified proof of bank details (less than 3 months old) NOTE: Internet bank statements will not be accepted

20. Static Details Change Beneficiary Changes There are no beneficiaries loaded on a VIP

21. Static Details Change ID Number or Name Changes Signed and completed Change of Static Details form AND Certified copy of marriage certificate (if surname change) Certified copy of ID with three specimen signatures if the client’s signature changed

22. Cession Partial or full cession allowed Investor’s responsibility to manage the cession We will keep record of the cession on the platform

23. Documents Needed for Outright Cession Signed and completed Cession Registration Form May result in a Capital Gains Tax event Certified FICA for Cedent (if not on file) Documents for Cessionary Certified copy of Identity Document Certified copy of physical address, not older than 3 months Bank details, not older than 3 months SARS tax number

24. Documents needed for collateral Signed and completed Cession Registration Form Certified FICA docs for Cessionary, if not on file Certified copy of letter (on letterhead) from Institution / Cessionary

25. Death Claim There are no beneficiaries loaded on a VIP We will act on instructions received from the executor of the deceased estate

26. Death Claim Documents Required: Certified copy of death certificate Post mortem report (if unnatural death) Certified copy of deceased’s ID Certified copy of letter of Executorship Signed and completed Claim Application & Discharge form Certified copy of marriage certificate (if married within community of property before 1984 or anti-nuptial contract with accrual) Certified proof of bank details (less than 3 months old) OR cancelled cheque Payment will only be made to the Estate’s bank account

27. Cut offs for processing Any instruction for processing has to be batched and submitted to Admin before 9:00 (Money Market & Life portfolios) all other funds are before11:00 Ensure that your broker actually SENDS it well within cut off so that there is sufficient time for batching and submission to Admin Recurring Contribution: 3 business days prior to collection ** Business policy will be to submit instructions as and when received – real time processing. Do not hold back on instructions if the cut off for the day was missed **

28. Tax All taxes levied in the hand of the investor We don’t pay tax on behalf of the client (four fund approach) IT3(b) for distributions IT3(c) for capital gains/losses Each investor paying according to his/her marginal rate Dividend Withholding Tax 15%

29. Legislation Collective Investment Schemes Act Exchange Control Regulations Income Tax Act Financial Intelligence Centre Act (FICA) Financial Intermediary and Advisory Services Act (FAIS)

30. Fees IFA initial fee 0% - 5% excl VAT IFA ongoing fee 0% - 1% excl VAT No initial platform fee Ongoing platform fee PSG – before 1 Aug 2011 = sliding scale PSG – after 1 Aug 2011 = 0.4% for Konsult & Online 0.5% for Retail Neg for Best of Breed LESS REBATES

31. Fax and E-mail Indemnity Faxed instructions will be accepted, FICA docs have to be certified Where an advisor did not certify FICA docs, we will check if Fax and E-mail Indemnity is on file (excluding I.D.) If a client signed the F/E Indemnity in the application form/ other transaction form, we will accept instructions via e-mail

32. Disclaimer The information contained in this document is correct at time of the presentation. All figures and points must be verified prior to any business dealings due to the dynamic nature of legal and financial environments. Though every effort is made to ensure the accuracy of the information contained herein, the author cannot guarantee the validity and or current information in future circumstance when legislation is adapted. The author accepts no responsibility for the use of validated information and the misuse of current information. Individuals misusing current information or using outdated information will be personally liable for any damages/consequences incurred. PSG Asset Management Administration Services Limited reserves the right to adapt provisions as set out in this presentation where applicable legislation and practices change. PSG Asset Management Administration Services Limited is an approved financial services provider.