b'Appendix BGlossary of Terms CGT: Capital Gains Tax.EIS Relief: Relief from income tax under EIS.Investor: An individual who completes an Application Form in the form associated with this Information Memorandum Closing Date: 26th March 2021 , or such other date as the FundEntrepreneurs Relief: Tax relief pursuant to Part V Chapterwhich is accepted by the Fund Manager and so enters into an Adviser Fee: A fee charged at the discretion of the Investor,Manager may determine at its discretion. III of the Taxation of Chargeable Gains Act 1992, by whichInvestors Agreement and invests into the Fund.payable to authorised advisers or intermediaries, taken frommaterial disposals of business assets within an individuals the Investors subscription, upon receipt of written instructionsCollective Investment Scheme: As defined in the Financiallifetime limit of 10,000,000 qualify for a reduced rate ofInvestor Centre: The online portal provided by Mercia to from the Investor. This fee is normally paid as soon as possibleServices and Markets Act 2000.CGT of 10%.Investors facilitating access to Investment information, as upon investment, but other arrangements can be made. Thefurther described at page 18.Fund Manager will not pay any commission to advisers orCustodian: The Share Centre Limited (02461949), or suchFees and Expenses: The fees and expenses set out in Schedule intermediaries.other or joint administrator and/or custodian as is appointed2 to the Investors Agreement comprising each of the EIS FundInvestors Agreement: An Investors Agreement to be entered by the Fund Manager under the Investors Agreementsand SEIS Fund or either of them.into by each Investor, in the terms set out in Appendix C at the AIM: The Alternative Investment Market of the London Stockfrom time to time. References to the Custodian also includeback of this Information Memorandum. Exchange.references to the Nominee, Share Nominees Limited, which isFCA: The Financial Conduct Authority. wholly owned by The Share Centre Limited. Knowledge Intensive Company: Knowledge Intensive Annual Management Charge: An annual 1.75% charge whichFCA Rules: The rules contained in the FCAs Handbook of RulesCompanies are those that spend a certain proportion of is charged to the Investor, which covers the management ofCustodian Agreement: The agreement between the Custodianand Guidance.their cost base on research and development or innovation. the fund. This fee is charged for a maximum of six years.and the Fund Manager on behalf of the Investor relatingAdditionally, they need to meet either an innovation condition to custody and other services to be provided, to be read inFSMA: The Financial Services and Markets Act 2000.or a skilled employee condition to qualify as a Knowledge Applicable Laws: All relevant UK laws, regulations and rules,conjunction with the Custodians Terms of Business.Intensive Company.including those of any government or of the FCA. Fund: Mercia EIS Fund, referring to the following for which an Custodians Terms of Business: www.share.com/Global/ application may be made Mercia EIS Fund (Q1 2021). Loss Relief: Relief from income tax or CGT on losses arising Application Form: An application form to invest in the FundForms/partners/eis/eis-cust-tobs.pdf from disposals, or deemed disposals, of Shares. completed by the prospective Investor in the form providedFund Manager or Manager: Mercia Fund Management by the Manager. There is a separate application form for eachCustodian and administration fee: An annual 0.25% feeLimited, or such other fund manager as may be appointedMaximum Fund Size: The maximum aggregate amount of distinct fund and applications will only be accepted on the formcharged to the investor, which covers all custodial andunder the terms of the Investors Agreement.Subscriptions by Investors determined by the Fund Manager. relating to the fund the applicant looks to invest in.administrative duties. To provide clarity, The Share Centre charges the Fund Manager 75 per client per year, whichHMRC: HM Revenue & Customs.Mercia/the Mercia Group: The group of companies which Associate: Any person or entity which controls (whetheris not directly passed onto the investor, and the 0.25% alsocomprises of Mercia Asset Management PLC (AIM; MERC) and directly or indirectly) or is controlled by the Fund Manager. Forcovers additional costs for Mercias administration of the fund.IHT: Inheritance Tax.its fund management companies. the purpose of this definition, control shall refer to the ability to exercise significant influence over the operating or financialDate: 5th January 2021 Information Memorandum (IM): This InformationMercia Fund Management Limited: Mercia Fund Management policies of any person or entity.Memorandum issued in relation to the Fund. Limited, which is a company incorporated in England and Dealing charge: A 0.35% charge paid to the Custodian byWales with the company number 6973399 and which is an BPR: Business (Property) Relief from IHT under Chapter I, Part Vthe client upon all transactions, including both the purchaseIntermediary: A person/company who arranges theauthorised firm regulated by the FCA under Firm Reference of the Inheritance Tax Act 1984.and the sale of shares. For the benefit of the client, the Fundinvestment for the Investor.Number 524856.Manager has made an arrangement so that on the sale of Capital Gains Deferral: EIS deferral of CGT under Sectionshares, the client pays a maximum of 0.35% of the originalInitial Fee: Set-up fee deducted from the InvestorsMinimum Fund Size: The minimum aggregate amount of 150C and Schedule 5B of the Taxation of Chargeable Gains Actcost of the shares, as opposed to the 0.35% of the full saleSubscription.Subscriptions by Investors determined by the Fund Manager. 1992.value of shares. Investee Company: A company in which an investment isNominee: Share Nominees Limited (02476691), or such other Capital Gains Exemption: Exemption from CGT on gainsEIS: The Enterprise Investment Scheme, as set out in Part 5 ofmade by the Fund.nominee as the Manager may appoint from time to time. realised upon sales of Shares in EIS and SEIS-qualifyingthe Income Tax Act 2007. Companies.Investment: An investment made through the Fund.Opening Date: 4 January 2021, or such other date as the Fund EIS Fund: The Mercia EIS Fund relating to EIS-qualifyingManager may determine at its discretion.Carry Back Relief: Income tax relief under the EIS or SEIS whichinvestments. Investment Objectives: The investment objective for the Fund is set against an individuals income tax liability for the tax yearas set out in Schedule 1 to the Investors Agreement.Performance Fee: A 20% fee charged by the Fund Manager preceding that in which the Shares are issued.EIS-qualifying Company: A company that meets the EISon returns over the Investors net fund investment. requirements regarding EIS Relief and Capital Gains Deferral.Investment Restrictions: The investment restrictions for the Fund as set out in Schedule 1 to the Investors Agreement.Portfolio: The monies an Investor subscribes to the Fund, plus 30 31'