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ANNOUNCEMENT: Termination of a fund managed by Danske Invest Fund Management Ltd.

At its meeting on 7 April 2022, the Board of Directors of Danske Invest Fund Management Ltd resolved to terminate the Danske Invest Russia Fund. As a result of this decision, the suspension of subscription and redemption orders that took place on 28 February 2022 will become permanent.

Why was the decision made to terminate the fund?
The decision was based on the military action initiated by Russia in Ukraine, which has in many ways affected the fund's operating conditions in the target market. The most significant of the immediate operational impacts involves the challenges associated with the liquidity of the fund's investments and the settlement of trades. In the fund management company's view, the challenges in the target market prevent reliable determination of the fund’s value and, in particular, opening redemption orders in a controlled manner without endangering the equality of unit holders.
 
In addition to the above-described operational reasons, the decision to terminate the fund was influenced by Danske Invest’s commitments and principles associated with responsible investments. After the start of Russia’s invasion, Danske Invest announced that the invasion was contrary to Danske Invest's policy for responsible investments, and therefore added all Russian government bonds and Russian state-owned companies to the exclusion list. Existing investments were announced to be disposed taking into account the existing restrictions and the interests of unit holders. Due to these expanded investment restrictions, the management company is of the opinion that the Russian equity market does not have a sufficiently broad and diverse universe of investable companies, and therefore it does not allow mutual fund type of investment activity in the short or medium-term.
 
How will the termination of the fund proceed?
As a result of the decision to terminate the fund, the fund's assets will be converted into cash, from which any liabilities will be deducted, after which remaining liquidated assets will be distributed in full to the fund’s unit-holders in proportion to the units they hold. Due to the exceptional situation, the conversion of assets into cash will take longer than usual, and consequently, assets may be paid to unit holders in several different payments, the first of which is planned to take place by 30 September 2022 at the latest. No management fee will be charged for the fund for the period during which it has not been possible to calculate the value of the fund units, i.e. as of 26 February 2022.
 
The continuous fund saving agreements connected to the fund will be terminated. Orders issued to the fund management company after 1.00 pm on 25 February 2022 and not yet executed will be cancelled.
 
The termination is considered a taxable sale of fund units in the case of persons generally liable to pay tax in Finland. Therefore, a unit holder will be taxed on the capital gains arising from the sale of fund units or, alternatively, the unit holder will be able to deduct the capital losses arising from taxation. If the fund's assets are paid in more than one payment, the profits will also be realised in several instalments and possibly over several tax years. Danske Invest Fund Management Ltd will notify the Tax Administration of the transfer of units, and this will be shown on the unit holder’s tax return. We kindly ask you to verify that the information concerning the termination of the fund is correct on your tax return. The Tax Administration must be notified of any incorrect information.
 
The fund management company will draw up final accounts on the termination, which will be published on the fund management company’s website at www.danskeinvest.fi.
 
The termination of the fund does not require you to take any other action.
 
Where can I find out more information about the termination of the fund?
Danske Invest Fund Management Ltd will provide information on the progress of the process on its website at www.danskeinvest.fi.
 
Yours sincerely,
 
DANSKE INVEST FUND MANAGEMENT LTD

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