CONSTITUTION

Of the KERRCHING INVESTMENT CLUB:

This agreement is made this (DATE) between the undersigned people as founder members for the purpose of joint investment in stocks, shares, bonds, options, securities and investments of a like nature for their mutual benefit and interest.

1. The first principle of the club shall be that no member shall be deprived of his/her equitable share in the assets of the club.

2. Members of the club shall make regular contributions in such amounts and on such basis as is from time to time agreed or required by the rules.

3. Members shall be bound by the rules to be determined by members. Such rules may be varied by a 75% majority of members attending and agreeing a resolution at a properly convened general meeting but the rules shall not at any times contravene the principles of this constitution. The constitution cannot be altered without agreement of 75% of the club for the time being.

4. The club shall deal solely with investments on behalf of its own members and shall neither deal on behalf of nor advise any persons other than its members in relation to investments of any kind. All its activities will be confined to the mutual benefit and interest of its members.

5. Club membership shall NOT be restricted . New members shall only be admitted after being proposed and seconded by two existing members. 80 per cent of the total club membership must vote in favour of a new member for them to be accepted. A non attendance will be counted as a positive vote, unless the member registers a negative vote prior to the meeting. The negative vote must be in writing, and passed to the Secretary.

6. No member shall assign, pledge, transfer, mortgage or sell any part of his/her interest in the club to another member or anyone else except as permitted by the authorised procedure for selling back all or part of his/her interest to the club itself.

7. No member shall be compensated for services rendered to the club and no member shall bind or obligate the club or any member of the club to any matters outside the affairs of the club, and in respect of the club's affairs they shall only enter into agreements on the authority of a resolution properly passed by members.

8. The rules shall determine the procedure whereby a member may resign from the club and withdraw his/her equitable share of the club's assets but the maximum period to elapse between the date of resignation and the date of full repayment shall not exceed 90 days.

9. The club shall hold a general meeting once in every calendar year as its annual general meeting provided that every annual general meeting shall not be more than 15 months after the preceding annual general meeting. The club's first annual general meeting shall be within 15 months of its inauguration.

10. At each annual general meeting, the members shall elect a chairman, honorary treasurer and honorary secretary who will resign at the following annual general meeting but be subject to re-election. Members will also elect the club's auditors. If the auditors are members of the club they shall at be at least two in number and shall not be executive officers of the club.

11. At each annual general meeting, a statement of account shall be given by the treasurer, together with the report of the auditors. The treasurer's report shall include a full record of the club's income and expenditure: a list of the club's assets together with its end-of-year valuation; also a capital account for each member showing his/her total contributions and drawings together with the current value of his/her holding.

12. Upon the death of any member the value of his/her equitable share in the club shall be paid to the executor of the estate in accordance with the club's rules for dealing with a member leaving the club.

13. The club's investments shall be held in the names of trustees, of whom there shall be at least two, who will sign a Declaration of Trust, and who shall be appointed by a resolution of the majority of the clubs members.

14. The club shall open an account with a bank or building society and all club monies shall be paid into this account except in so far as monies from disposal of investments may be retained by the club's stockbroker pending reinvestment. At least two of the club's officers or other members nominated by the club for this purpose must sign all cheques and the bank/building society shall be instructed accordingly.

15. If any member should assign, charge or otherwise encumber his/her share in the club as prohibited by clause 6 of the agreement, he/she shall be expelled from the club. if any member shall become bankrupt, insane or otherwise incapable of taking part in the club's business, OR shall act in any manner inconsistent with good faith observable between the members, OR shall be guilty of any conduct with could injure the good name of the club, OR bring about its dissolution , it shall be lawful for other members to notify the offending member in writing that members shall consider his/her expulsion from the club. A member being issued with such a warning shall be given the opportunity to offer other members any explanations as he/she considers desirable.

16. A member shall be expelled if ALL members of the club are at a properly constituted general meeting of the club, and support a resolution to that effect. A member who is expelled shall be notified in writing and shall have his/her equitable share of the club assets returned in accordance with the rules of the club. A proxy vote will be acceptable as long as the proxy vote is received by the secretary prior to the meeting.

17. The clubs trustees can only be instructed to purchase investments if a resolution to that effect has been agreed at a properly constituted general meeting, by 75 per cent of members attending. Selling of investments may be sold without calling a meeting if criteria is met as laid down in the club investment strategy.

18. The club will hold a meeting every quarter to discuss the performance of the fund and to examine which markets to invest in.

CLUB RULES

1. THE AFFAIRS OF THE CLUB

The affairs of the club shall be conducted in accordance with the letter and spirit of the constitution laid down by members. The constitution may only be changed by agreement of not less than 75% of current members of the club.

2. OFFICERS

The affairs of the club shall be managed by three officers, chairperson, honorary secretary and honorary treasurer who shall be elected by a simple majority of members attending the annual general meeting of the club. These officers shall resign at the following annual general meeting but shall be eligible for re-election. If an officer should leave the club, die or otherwise be unable to continue to carry his/her duties, a replacement may be elected at a subsequent ordinary meeting of members. Other officers may be elected from time to time to assist the three main officers.

3. MEETINGS

a) In each year there shall be held 3 quarterly meetings and one annual general meeting, at which all members shall be entitled to be present and to vote on all matters.

b) Dates and venues of meetings may be varied in accordance with a resolution supported by a simple majority of those attending a properly constituted meeting of the club; such resolution and all others must be carried at a meeting where there is a quorum comprising of more than half of the current membership.

c) All members shall be given at least 5 days notice of dates and venues of meetings.

d) A special general meeting may be convened by not less that three members for the purposes of resolving special items of club business subject to written request being submitted to the secretary who will without undue delay then give at least 21 days notice to all members.

e) General meeting agenda must be issued at least 7 days prior to the date of the next general meeting.

f) The minutes of the previous general meeting must be issued at least 5 days before the date of the next meeting.

4. MEMBERSHIP

In accordance with the constitution the membership of the club shall not exceed 20 persons at any time

5. ELECTION OF NEW MEMBERS

a) The election of a new member requires 80 per cent of the total membership to vote in favour of the proposed new member. A non-attendance at the meeting considering a new member, will be counted as a positive vote, unless that member registers a negative vote prior to the meeting. The negative vote must be in writing and passed to the secretary before the vote commences.

b) a prospective member must be proposed and seconded by two existing members and notified to the secretary before the agenda is published. The proposed members name, address, proposer and seconder to be included in said agenda. Once the agenda has been published no further proposal of new members will be included.

c) The club reserves the right to refuse admission to any person without giving a reason.

d) On admission to the club, a new member shall pay the entry fee and the first month's subscription. These sums will purchase for the new member a number of units calculated according to the club rules and the unit value prevailing at the time of joining.

6. WITHDRAWAL OF MEMBERSHIP

a) a member shall cease to be a member of the club if he/she is in contravention of Clause 15 of the constitution.

b) If a member should die or cease to be a member for any reason, the club shall pay to the member or to person entitled by law an amount equal to the formers member's share in the assets of the club as defined in Rule 11.

7. JOINING FEE

a) All members will pay a joining fee of 50 pounds. 10% will go into the clubs general fund, the remainder will purchase for that member an appropriate number of units according to the unit value at the time of joining.

b) This fee may be varied at the club's annual general meeting or at a special general meeting.

8. SUBSCRIPTIONS

a) A subscription of 10 pounds per calendar month shall be paid into the club's bank/building society account by all members on or before the 16th day of each month by means of a standing order from a bank, building society or similar source.

b) Each member's subscription will purchase for that member an appropriate number of units according to the unit value declared as per rule 9b.

c) The treasurer shall notify members at their monthly meeting if any member is in arrears.

d) The monthly subscription and the level of the club brokerage may be varied at the club's annual general meeting or at a special general meeting.

9. CAPITAL ACCOUNT

a) The club's assets shall be valued monthly on the Friday preceding the next meeting, or close to that Friday as reasonably possible, by the treasurer and a report shall be presented at the next meeting. The value of investments shall be based on the "bid" closing prices where available, failing this the "middle" prices as recorded in the Financial Times or other reliable source of stock market information.

b) The value of a club unit is calculated as:

Value of unit = (Value of Shares) - (Dealing Charges) + (Cash Held)

Units Sold to Members

10. MEMBER'S ACCOUNTS

An account shall be kept for each member of the club showing: the total investment made by each member by means of subscription, joining fee or additional purchases of units; the total of withdrawal made by each member who has sold back units to the club; the total number of units currently held by the member and the current value of his/her holding.

11. MEMBER LEAVING THE CLUB.

a) Resignation from membership must be submitted in writing to the chairperson, treasurer or secretary not less that seven days before the monthly meeting at which the resignation is to take effect.

b) Members leaving the club, whether by resignation or as the result of termination of membership under Rule 6, shall sell back to the club their entire holding of units.

c) the amount to be paid to a member leaving the club shall be calculated by multiplying the total number of units held by the member by the unit value declared by the treasurer at the club meeting at which the resignation be came effective, subject to deduction of club brokerage if such should be in force at that time and any legal fees incurred by the club in connection with the withdrawal of the member. Any surplus cash held to the members credit will be added.

d) payment to the member who has left the club shall be made as soon as possible and in any case within 90 days of the resignation being effective.

e) the value of the payment to the member shall be based on the value of the fund on the Friday of the next week following the members decision to leave.

12. BROKERAGE CHARGES

The club shall levy a brokerage charge of 3 per cent to a maximum of 15 pounds, for units sold back to the club. Should it become necessary to sell the clubs assets in order to pay the "selling" member, then any charges above the 15 pound maximum must be met by the "selling" member. At all times the club will endeavour to keep the actual cost to the member to the minimum.

13. BANKING.

a) The club's bankers/building society shall be determined annually at the annual general meeting but may be changed by agreement of a majority of members at a special general meeting called in accordance with rule 3.

b) All cheques drawn on the club's account(s) shall require any two of three authorised signatures. Where possible one of the signatories of cheques should be the chairperson. In the event of one authorised signatory being unavailable for the an extended period, the officers of the club may authorise a further signatory for the period involved. All income shall be paid direct in to the club's bank/building society account(s) except where members have approved an arrangement whereby the stockbroker retains the funds from the sale of one r more investments pending the purchase of other investments.

c) the club's bank/building society shall be instructed not to grant any overdraft facilities to the club.

14. BROKERS

The club's brokers shall be instructed that

a) only one of three named officers are authorised to buy or sell investments on behalf of the club.

b) no member is authorised to commit the club beyond the cash held by the club

c) All cheques due to the club's account are to be made out to the club's name on non-transferable cheques.

15. COMMITMENTS

No club member shall make any commitment on behalf of the club or commit club fund without written authorisation to do so.

16. TRUSTEES

Trustees shall be appointed in accordance with the constitution.

17. The rules of the club may be amended or rescinded at a general meeting of the club subject to agreement by at least 75 per cent of the members at a properly constituted general meeting.

18. MINUTES

Minutes of the club shall be kept and shall be available for inspection by any member of the club at any reasonable time.

19. DISPUTES

a) Any disputes as to the interpretation of these rules shall be decided by the chairperson unless notice is served requesting that the mater should be resolved by a special general meeting of club members.

b) Any disputes relating to the valuation of a member's share in the assets of the club or his/her entitlement to that share shall be decided by a chartered accountant (to be appointed by the chairperson of the club) of at least seven years standing whose certificate of decision shall be final. Fees incurred in obtaining this decision shall be paid by the party to the dispute against whom the decision is made, or in the case of this not being clear the fees shall be shared between the club and the member of ex-member concerned.

20. WINDING UP

The club shall be wound up and all assets divided among members (after payment of club expenses) in accordance with the number of units held by each member if a resolution to that effect is passed by at least 75 per cent of the members of the club at a properly constituted meeting.

21. TAX LIABILITY

Membership of the club implies acceptance of proportional tax liability on trading profits made by the club in any tax year.

22. VOTING RIGHTS.

Subject to the minimum holding, voting shall be on a one member one vote system, regardless of the number of units held.

23. Share certificates shall be held within a deed box. Access to this box shall be by one of two nominated members, not mentioned in Rule 14b.

THESE ARE THE AIMS OF THE KERRCHING INVESTMENT CLUB.

1. EACH MEMBER WILL CONTRIBUTE THE SAME AMOUNT OF MONEY TO THE FUND.

2. THE FUND (BASED ON A MAJORITY VERDICT OF 75%) WILL PURCHASE SHARES THROUGH A STOCKBROKER.

3. A PERCENTAGE (10%) OF ALL MONEY INVESTED WILL BE KEPT IN A BANK ACCOUNT FOR THE PURPOSE OF REPAYING MONEY TO INVESTORS WHO WISH TO LEAVE OR TO CASH IN PART OF THEIR INVESTMENT.

4. A DECISION ON WHETHER TO PURCHASE NEW SHARES WILL BE MADE EVERY 3 MONTHS AFTER DISCUSSIONS AT EACH QUARTERLY MEETING.

5. AT INCEPTION,THE FUND WILL BE DIVIDED INTO UNITS AND EACH INVESTOR WILL ?OWN? THE SAME NUMBER OF UNITS

THE VALUE OF EACH UNIT WILL BE DECIDED AT THE FIRST MEETING.

6. INVESTORS WILL BE ABLE TO SELL UNITS BACK TO THE FUND BASED ON THE VALUE OF EACH UNIT CALCULATED ON THE FIRST FRIDAY OF NORMAL TRADING FOLLOWING THE WRITTEN REQUEST TO THE CLUB TREASURER.

(THOUGH THIS SELL BACK OPTION IS RESTRICTED TO ONCE PER YEAR AND IS SUBJECT TO THE USUAL CLUB CHARGES)

7. DEPENDING ON THE SUCCESS OF THE PREVIOUS 12 MONTHS TRADING AND AMOUNT OF DIVIDENDS EARNED THE INCOME GENERATED FROM THE SHARES WILL BE DIVIDED BETWEEN CLUB MEMBERS ON THE FUNDS ANNIVERSARY. (IN PROPORTION TO THE NUMBER OF UNITS EACH MEMBER HOLDS)