Private Investors

Only professional and semi-professional investors may be admitted to Montold SME Lending Fund GmbH & Co. KG (the Fund)

The definition of a professional investor is provided in § 1 (19) 32. KAGB, which refers to the Directive 2014/65/EU of the EU Parliament and of the Council of 15 May 2014 on markets in financial instruments, that describes the professional investors as investors who possess the experience, knowledge and expertise to make its own investment decisions and properly assess the risks that it incurs.

In order to qualify for a professional investor, the investor must comply with the following criteria:

Categories of investors who are considered to be professionals

1. Entities which are required to be authorised or regulated to operate in the financial markets.
2. Large undertakings meeting two of the following size requirements on a company basis:
   —   balance sheet total: EUR 20 000 000
   —   net turnover: EUR 40 000 000
   —   own funds: EUR 2 000 000
3. National and regional governments, including public bodies that manage public debt at national or regional level, Central Banks, international and supranational institutions such as the World Bank, the IMF, the ECB, the EIB and other similar international organisations.
4. Other institutional investors whose main activity is to invest in financial instruments, including entities dedicated to the securitisation of assets or other financing transactions.

Investors who may be treated as professionals on request

Investors other than those mentioned in Section I, including public sector bodies, local public authorities, municipalities and private individual investors, may waive some of the protections afforded by the conduct of business rules.

Any such waiver of the protection afforded by the standard conduct of business regime shall be considered to be valid only if an adequate assessment of the expertise, experience and knowledge of the investor, undertaken by the Fund, gives reasonable assurance, in light of the nature of the business of the Fund, that the investor is capable of making investment decisions and understanding the risks involved.

In the course of that assessment, as a minimum, two of the following criteria must be satisfied:

• the investor has carried out transactions, in significant size, on the relevant market at an average frequency of 10 per quarter over the previous four quarters,
• the size of the investor’s financial instrument portfolio, defined as including cash deposits and financial instruments exceeds EUR 500 000,
• the investor works or has worked in the financial sector for at least one year in a professional position, which requires knowledge of the transactions or services envisaged.

The definition of a semi-professional investor is provided in § 1 (19) 33. KAGB. A semi-professional investor is:

1. any investor,
   a.   who undertakes to invest at least 200,000 euros,
   b.   who states in writing, in a document separate from the contract on the investment commitment, that he is aware of the risks associated with the intended commitment or investment,
   c.   whose expertise, experience and knowledge is assessed by the management company of the Fund – Montold Asset Management GmbH - without assuming that the investor has the market knowledge and experience of a professional investor;
   d.   where Montold Asset Management GmbH is reasonably satisfied, taking into account the nature of the investment, that the investor is capable of making own investment decisions and understands the risks involved and that such a commitment is appropriate for the investor; and
   e.   to whom Montold Asset Management GmbH confirms in writing that it has carried out the assessment referred to in clause (c) above and that the conditions referred to in clause (d) above are met,
2. any investor who undertakes to invest at least EUR 10 million in the Fund,
3. any investor in the legal form of an institution or foundation under public law and a company in which the Federal Government or a Land holds a majority interest.