The Charities (The Peabody Donation Fund) Order 1997

SCHEDULE 1 POWERS OF INVESTMENT

Investment

1.—(a) Any property of the Charity for the time being available for investment shall be invested under the control of the Governors in accordance with the provisions of this paragraph.

(b) Subject to sub-clauses (d), (e) and (f) of this clause the Governors may invest the cash and other property of the Charity at their discretion in:

(i) any investments which are qualifying investments within the meaning of paragraphs 2 to 8 of Schedule 20 to the Income and Corporation Taxes Act 1988 but excluding units of a Unit Trust scheme which is not an authorised Unit Trust under the Financial Services Act 1986 where any such investments are traded investments they must be such as are traded with proper authority on a recognised stock exchange within the meaning of section 841 of the Income and Corporation Taxes Act 1988.

(ii) in mortages within the limits permitted by paragraph 13 Part II of Schedule I to the Trustee Investments Act 1961.

(c) Any land held as an investment which belongs to the Charity at the date on which this Scheme is given effect by an Order of the Secretary of State under section 17(2) of the Charities Act 1993 may continue to be retained as an investment. Where such land is sold, subject to the taking and consideration of advice from a professional adviser who is qualified by his ability in and practical experience of land held as an investment, the Governors may apply the proceeds of sale in investing in other freehold or leasehold land in England or Wales.

(d) The Governors shall at all times keep the investments of the Charity under review (including land held by them as an investment) and may at any time at their discretion realise exchange or otherwise dispose of any investment (including land held as an investment) or deposit or loan either to raise cash for the purposes of this Scheme or for investment in accordance with the terms of this Scheme.

(e) In performance of their functions under this clause the Governors shall have regard to:

(i) the need for diversification of investments (including land held as an investment) of the Charity in so far as it is appropriate to the circumstances of the Charity; and

(ii) in relation to any investment (including land held as an investment) of the Charity or any proposed investment, to the suitability to the Charity of the investments of the description concerned and of the particular investment as an investment of that description.

(f) Unless authorised by an Order or Orders of the Commissioners the Governors shall not invest by way of underwriting any new issue of shares stock or other securities. Provided that they may invest by way of underwriting an issue of stock eligible to be held by the Charity where the Governors do so in order to secure an allocation of the new issue (and not for the sole or main purpose of obtaining commission) and are satisfied that the Charity has the resources to take up the allocation and that to do so would not be hazardous or speculative.

Investment Expert

2.  In this Scheme the expression “Investment Expert” shall mean either a company or firm of repute in the field of investment which is an authorised person or an exempted person for the purposes of the Financial Services Act 1986 or an individual being an authorised person for the purposes of that Act who has not less than 15 years experience in the City of London of investment and financial management.

Investment advice

3.—(a) The Governors shall arrange that the investments (including land) are at all times kept under review by one or more investment experts and other professional advisers who shall be instructed and required to undertake to inform the Governors promptly of any changes in investments which appear to them to be desirable except to the extent that the Governors have exercised power of delegation conferred by paragraph 5 of this Schedule.

(b) No investment other than one which is for the time being a narrow range investment within the meaning of the Trustee Investments Act 1961 shall be made by the Governors except on the advice of an Investment Expert.

Investment Manager

4.  The Governors may appoint as the Investment Manager for the Charity a person whom they are satisfied after inquiry is a proper and competent person to act in that capacity and who is either:

(a) an individual of repute with at least 15 years experience of investment management who is an authorised person within the meaning of the Financial Services Act 1986 or

(b) a company or firm of repute which is an authorised or exempted person within the meaning of that Act otherwise than by virtue of section 45(1)(j) of that Act;

Delegation

5.  The Governors may delegate to an Investment Manager so appointed power at his discretion to buy and sell investments for the Charity on behalf of the Governors in accordance with the investment policy laid down by the Governors. The Governors may only do so on terms consistent with this Scheme.

6.  Where the Governors make any delegation under this Schedule they shall:

(a) inform the Investment Manager in writing of the extent of the Charity’s investment powers;

(b) lay down a detailed investment policy for the Charity and immediately inform the Investment Manager in writing of it and of any changes to it;

(c) ensure that the terms of the delegated authority are clearly set out in writing and notified to the Investment Manager;

(d) ensure that they are kept informed and review on a regular basis the performance of their investment portfolio managed by the Investment Manager and on the exercise by him of his delegated authority;

(e) take all reasonable care to ensure that the Investment Manager complies with the terms of his delegated authority;

(f) review the appointment at such intervals not exceeding 24 months as they think fit;

(g) pay such reasonable and proper remuneration to the Investment Manager and agree such proper terms as to notice and other matters as the Governors shall decide and as are consistent with this Scheme provided that such remuneration may include commission fees and/or expenses earned by the Investment Manager if and only to the extent that such commission fees and/or expenses are disclosed to the Governors.

7.  Where the Governors make any delegation under this Schedule they shall do so on terms that:

(a) the Investment manager shall comply with the terms of his delegated authority;

(b) the Investment Manager shall not do anything which the Governors do not have power to do;

(c) the Governors may with reasonable notice revoke the delegation or vary any of its terms in a way which is consistent with the terms of this Scheme; and

(d) the Governors shall give directions to the Investment Manager as to the manner in which he is to report to them all sales and purchases of investments made on their behalf.

Holding of Investments

8.  The Governors may:

(a) make such arrangements as they think fit for any investments of the Charity or income from those investments to be held by a corporate body as custodian trustee or as the Trustees nominee; and

(b) pay reasonable and proper remuneration to any corporate body acting as custodian trustee or the Trustees nominee in pursuance of this paragraph.