Fees & Expenses

The legal, administrative, audit and other associated costs of the fund transfer will be borne by Aberdeen group and not by funds’ shareholders; there will be no other associated charges.

Management fees have been set at the same rates as applied previously in Ireland.

The charging structure of the new Luxembourg funds differs from that currently applicable in Ireland: in Luxembourg, the total costs of administration are charged to the funds directly, whereas in Ireland the costs of administration are paid by Aberdeen, partially offset by fixed percentage charges which are levied upon the funds.

Since the acquisition of the affected funds from Deutsche Asset Management Group Limited in 2005, Aberdeen has been subsidising the administration charges for these funds at a rate which is unsustainable. Regardless of whether funds remain in Ireland or move to Luxembourg, it is Aberdeen’s intention (subject to appropriate notice being given to shareholders) to reduce this subsidy to a more viable level and this may result in some increase to the administration fees charged. However, by consolidating operations in Luxembourg, we are able to limit the increase which would otherwise apply on an on-going basis in Ireland and, indeed, to deliver cost savings in respect of certain funds.

In order to ensure that clients are not unduly impacted by the transfer, expenses in Luxembourg will be capped. From the date of transfer, the rate at which these are charged will be no more than that currently applicable in Ireland. With effect from 30 September 2008, new rates will apply to certain funds. This arrangement will remain in place until further notice and, in any event, until at least 30 September 2009.

Current Irish expense rates per annum and the new Luxembourg rates (capped) per annum are detailed in the attached document.

Tax

The transfer will represent a disposal and re-investment for tax purposes. Aberdeen has taken generic tax advice in relation to the fund transfer proposals and believes that tax-exempt investors will be unaffected from a tax perspective. However, we are not able to give client-specific advice and it is therefore recommended that each client approaches their usual tax advisers for advice on this matter.