Prospectus

• Section A. Information on the issuer
• Section B. Information on the asset management company
• Section C. Regulations
• Investment declaration
• Section D. Information on the announced issuance of Fund's shares
• Section E. List of trading platforms where the Fund’s shares were or are sold
• Section F. Information on the registrar
• Section G. Information on the Custodian
• Section H. Information on the securities trader
• Section I. Information on the auditor
• Section J. Information on the independent property appraiser

PROSPECTUS
Open Joint Stock Company, Closed-End Non-Diversified
Corporate Investment Fund
"Synergy Real Estate"
(public offering)

Section A. Information on the issuer

1. Name:

- Full - Open Joint Stock Company Closed-end Non-Diversified Corporate Investment Fund "Synergy Real Estate";

- Short - Closed-end non-diversified corporate investment fund "Synergy Real Estate", OJSC; (the "Fund").

2. Registration Code (ЄДРПОУ) - 33499735.

3. Organizational and legal form - open joint stock company.

4. Location - 01034, 2/1 Lysenka/Yaroslaviv Val St, Kyiv.

5. Tel/fax: (044) 246-73-50/235-58-75.

6. Registered as a legal entity by the Pechersk District State Administration in Kyiv on 26 May, 2005.

7. Number and Date of state registration as a Fund (ЄДРІСІ) - №194, 29 July 2005.

8. Registration Code (ЄДРІСІ) - 132194.

9. Activity - collective investment through attraction and placement of investors' funds into securities of other issuers, corporate rights and real estate.

10. Objective – carrying out collective investment.

11. Registered and paid-up initial statutory fund - UAH 370,000 (three hundred seven thousand).

12. Termination date – 26 May 2020.

13. Date of the beginning of settlements with shareholders - no later than 26 August 2020.

14. Number of shareholders (as of 31 March 2006) - 44 (forty four).

15. Information on the Chairman and Fund's Supervisory Board:

16. List of founders holding over 10 percent of the Fund’s statutory capital:

• “KINTO” Invest Ltd., Registration Code (ЄДРІСІ) - 32915716;
• “OKIL” Ltd., Registration Code (ЄДРІСІ) - 32593636;
• Oksanych Antonina Sergiivna, passport series CO №128794, Issued in Kiev on 04.04.2000.

17. Information on the affiliated persons:

• Oksanych Serhiy Myhaylovych, passport series CH №873577, Issued in Kiev on 11.12.01.
• Ovcharenko Volodymir Viktorovich, passport series CH №770983, Issued in Kiev on 16.04.98.

Section B. Information on the asset management company

1. Name:

• Full - Open joint stock company “KINTO”.
• Short - "KINTO", OJSC, ("Asset Management Company").

2. Registration Code (ЄДРПОУ) – 16461855.

3. Organizational and legal form - open joint stock company.

4. Location, address - 26 Lesya Ukrainka Bld., Kyiv.

5. Tel/fax: (044) 246-73-50/235-58-75.

6. E-mail: kinto@kinto.com.

7. Date and authority of state registration - registered by the Executive Committee of Pechersk Administration on 23 March, 1992, re-registered by Pechersk State Administration on 8 January, 2003.

8. Information on the managers:

Name	Direct participation in the statutory fund (%)	Indirect participation in the statutory fund (%)
Oksanych Sergiy Mykhailovych	-	20.12
Fedorenko Anatoliy Vasyliovych	-	–
Radzievska Nadiya Victorivna	-	–
Veremienko Sergiy Mykolaovytch	-	0.04
Bobko Olha Ivanivna	-	–
Peter Goldsheider (citizen of Austria)	-	1.52
Lukasevych Vasyl Bogdanovych	0.13	0.13
Moskalenko Svitlana Mykolaivna	–	-
Yakovenko Ihor Valentynovych	–	–
Novikov Olexandr Mykolaovitch	-	–
Vasylyieva Irina Michaylivna	-	0.04

9. Asset Management Company also manages assets of such funds:

• "Dostatok" Fund (Interval Diversified Unit Investment Fund), registration code (ЄДРПОУ) - 221004;
• "Classical" Fund (Open-end Diversified Unit Investment Fund), registration code (ЄДРПОУ) - 211045;
• "Narodny" Fund (Interval Diversified Unit Investment Fund), registration code (ЄДРПОУ) - 221396;
• “KINTO Capital" (OJSC, Closed-end Non-Diversified Corporate Investment Fund), registration code (ЄДРПОУ) – 132073;
• “Synergy Bond” Fund (OJSC, Closed-end Non-Diversified Corporate Investment Fund), registration code (ЄДРПОУ) - 132100;
• “Synergy-2” Fund (OJSC, Closed-end Non-Diversified Corporate Investment Fund) registration code (ЄДРПОУ) - 132143;
• “Synergy-3” Fund (OJSC, Closed-end Non-Diversified Corporate Investment Fund), registration code (ЄДРПОУ) - 132354.

Section C. Regulations

Approved by
The OJSC Closed-End Non-Diversified
Corporate Investment Fund
"Synergy Real-Estate"
Constituent Assembly meeting
(Minutes No.1 dated 14 April, 2005)

Regulations
Open Joint Stock Company,
Closed-End Non-Diversified Corporate
Investment Fund "Synergy Real Estate"

1. Information on the Corporate Investment Fund.

1.1. Full name of the Fund:

• In Ukrainian - Відкрите акціонерне товариство "Закритий недиверсифікований корпоративний інвестиційний фонд "Синергія Ріал Істейт";
• In Russian - Открытое акционерное общество "Закрытый недиверсифицированный корпоративный инвестиционный фонд "Синергия Риал Истейт";
• In English - Open Joint Stock Company "Closed-End Non-Diversified Corporate Investment Fund "Synergy Real Estate" ("the Fund").

1.1.2. Short:

• In Ukrainian – ВАТ “ЗНКІФ “Синергія Ріал Істейт”;
• In Russian – ОАО «ЗНКИФ «Синергия Риал Истейт»;
• In English – OSJC “CNCIF “Synergy Real Estate”.

1.2. Date and Number of the Fund's registration certificate as a legal entity - 26 May, 2005, number of Fund’s registration – 1 070 102 0000 008976

1.3. Registration Code (ЄДРПОУ) - 33499735.

1.4. Location - Kyiv, Lysenko/Yaroslaviv Val str.,2/1.

1.5. Term - 15 (fifteen) years starting from the date of the Fund's state registration as a legal entity.

1.6. Initial Statutory fund - UAH 370,000 (three hundred seventy thousand).

1.7. Total nominal value of the first issue - UAH 370,000 (three hundred seventy thousand).

1.8. Number of shares first issued - 37 (thirty seven).

1.9. Nominal value of one share - UAH 10,000 (ten thousand).

1.10. Type of the share – nominal shares.

1.11. The form of share issue – documentary.

1.12. Date and number of the first issuance certificate - June 30, 2005, No 304/1/05.

2. Information on the Fund's founders

2.1. The Fund Founders are:

• "KINTO Invest Ltd.", location: Ukraine, 01034, Kyiv, Lysenko/Yaroslaviv Val str.,2/1, Registration Code (ЄДРПОУ) - 32915716;
• "Nadiya Invest Ltd.", location: Ukraine, 04074, Kyiv, Rezervna St., 8, Registration Code (ЄДРПОУ) - 22869164;

3. Change of asset management company

3.1. The asset management company ("The Company") is changed in case of:

• Approval by the Fund's annual general meeting (“General meeting”) of the decision on the early termination of contract with the asset management Company ("Contract on asset management");
• Decision of the Company to terminate activity on collective investment institutions asset management;
• Termination or cancellation by the State Securities and Stock Market Commission ("the Commission") of the Company's license on collective investment institutions asset management;
• Company's liquidation.

3.2. In case the Company is changed, all operations required for termination of the Contract on asset management and fulfillment of obligations stipulated by the Contract on asset management should be implemented. When the Company is changed, all measures stipulated by current legislature and the Contract on asset management aimed at protecting the Fund's shareholders' rights should be taken. In case the regulative acts of the Commission on the procedure on change of the Company on asset management come into force after the Regulations are approved, the change is implemented in keeping with the requirements of the given regulatory acts.

4. Change of the Fund's custodian

4.1. The Fund's custodian ("the Custodian") is changed in the case of:

• Approval by the Fund's General meeting of the decision on the early termination of contract with the Custodian servicing the Fund's assets;
• Decision of the Custodian to terminate the securities custodian depository activity;
• Termination or cancellation by the Commission of the Custodian's license on securities custodian depository activity;
• Custodian's liquidation.

4.2. In the case of Custodian's change, all operations required for termination of the Contracts between the Fund and the Custodian and fulfillment of obligations stipulated by these Contracts should be implemented. When the Custodian is changed, all measures stipulated by current legislature and the above Contracts aimed at protecting the Fund's shareholders (the “Shareholders”) rights and timely transfer the assets to new custodian should be taken. In case the regulative acts of the Commission on the procedure of Custodian's change come into force after the Regulations are approved, the change is implemented in keeping with the requirements of the given regulatory acts.

5. The procedure on determination of the net asset value of the Fund and the Fund's shares placement (redemption) price.

5.1. The Fund's net asset value is determined according to the procedure stipulated by the "Regulations on determination of collective investment institutions net asset value" (unit and corporate investment funds) approved by the Decision of the State Securities and Stock Market Commission as of 2 July, 2002, No. 201 ("Regulations"). In case the changes are made to this Regulation or in case the regulative acts on changes in the procedure of net assets value determination are approved, the net value of the Fund's assets is determined according to the requirements of legislature in force and corresponding regulative documents.

5.2. The Fund's net asset value does not include the value of securities, the issuance registration of which has been cancelled in accordance with the procedure established by legislature.

5.3. Securities the circulation of which has been terminated are included in the Fund's net asset value calculation at the rate of 75% of their book value.

5.4. In calculating the Fund's net asset value, the real-estate is valuated by the Company:

5.4.1. at estimeted value, determined by the independent property appraiser on the date of last valuation, on the assumption of the market price of the real-estate object;

5.4.2. at the price of the purchase of real-estate object in case, if after its purchase there was no reappraisal;

5.4.3. estimeted value of real-estate object may increase by the sum of expenses on reconstruction, technical re-equipment and improvement of real-estate object, done at the expense of the Fund.

5.5. In calculating the Fund's net asset value, the shares are valued by the Company:

5.5.1. at the price of the last market transaction, if it simultaneously meets the following requirements:

5.5.1.1. the amount of this transaction makes up at least UAH 5, 000 (five thousand);

5.5.1.2. the transaction is made no more than 30 (thirty) calendar days before the day of valuation;

5.5.1.3. the total amount of market transactions over 30 (thirty) calendar days preceding the day of valuation makes up at least UAH 10,000 (ten thousand);

5.5.2. at the price of the last book value- in other cases.

5.6. In calculating the Fund's net asset value, the fixed income securities are valued by the Company:

5.6.1. at the price of the last market transaction, if it simultaneously meets the following requirements:

5.6.1.1. this transaction is made on the day of valuation;

5.6.1.2. the amount of this transaction made up at least UAH 10,000 (ten thousand);

5.6.1.3. the total amount of market transactions during 30 (thirty) calendar days preceding the day of valuation makes up at least UAH 100,000 (one hundred thousand);

5.6.2. in other cases - by the formula:

where:

V- Calculating value of the security;
С_j- Payment (coupon, dividend, depreciation etc) in period j, UAH;
N- Nominal or depreciated value of the security;
d_j- Number of days until the 1st, 2nd….k payment, from the date of calculation;
d_n- Number of days until the maturity (redemption) of the security;

y_M- Yield to maturity, or offer (issuer’s offer for redemption of bonds before maturity), if such offer exists. Such yield is calculated at the day of market transaction or including such security to the Fund’s assets (in case of absence of market transactions or if those do not meet the requirements mentioned in pp. 5.5.1.2. and 5.5.1.3. of this Regulation) by the formula:

where:

P – last market transaction price (if this transaction meets the requirements stipulated in items 5.6.1.2. and 5.6.1.3. of the Regulation) or the price of purchase of the security (in case of absence of market transactions or if those do not meet the mentioned requirements );
C_i – payment (coupon, dividend, depreciation etc) in period I, UAH;
d_i – number of days until the 1st, 2nd….n payment, from the date of calculation.

5.7. In calculating the Fund's net asset value, the monetary market instruments are valued by the Company:

, where

V – Calculated value of the security;
P – Price of security purchase;
R – Security redemption (buy out) price;
d_i – Number of days until the date of payment from the date of purchase
d - Number of days until the redemption (buy out) date from the date of purchase.

5.8. A market transaction is a transaction made on the organized market, and the price of which at the moment of its execution is between the highest bid and lowest ask registered on this market.

5.9. The Company calculates the net assets value of the Fund:

• before the decision of the Commission about recognition the Fund as such, that satisfies the demands about the minimum amount of assets – at the end of the last working day of the quarter and for presenting a report to Commission about the results of the placement of ICI securities
• after the decision of the Commission about recognition the Fund as such, that satisfies the demands about the minimum amount of assets – at the end of the working day prior to the day of receiving applications for the Fund ‘s shares placement, quarterly and when the Fund is liquidated.

5.10. Until the Commission takes a decision about recognition the Fund as such, that satisfies the demands about the minimum amount of assets; the Company places the Fund’s shares at their nominal value.

5.11. After the Commission takes a decision about recognition the Fund as such, that satisfies the demands about the minimum amount of assets; the Company places the Fund’s shares at their calculated value.

5.12. The calculated value of the Fund's shares is determined by the ratio of the Fund's total net asset value to the number of the Fund's shares outstanding on the date of calculation.

5.13. The value of the Fund's shares acquired by the investor (except for the case stipulated by item 5.8 of the Regulations) is determined by calculated value of the Fund's shares on the day the Investor submits application for acquiring the Fund' shares.

6. The procedure of determination the Company's fee and covering the expenses incurred by the Fund.

6.1. The Company receives the Fee equal to 3.5 (three and a half) percent of the Fund's net asset value per annum.

6.2. The Company 's Fee is accrued monthly in the amount of 1/12 of the annual fee determined in item 6.1 of the Regulations, and is paid out monthly by advance payments by transferring the corresponding amount within 10 days after the end of the corresponding calendar month. The amount of the advance payments is calculated according to the procedure provisioned by regulatory acts of the Commission.

6.3. The Company's fee is adjusted annually at the end of the fiscal year according to the procedure provisioned by the regulatory acts of the Commission.

6.4. On the decision of the Fund’s Supervisory Board the Company may receive a bonus. Bonus is paid in case if the Fund’s received annual profit exceeds expected profitability benchmark (Profitability benchmark) set up in the Fund’s Investment declaration, that is coerced in Addition 1. The amount of this bonus is 15 percent of the difference between actual annual profit and expected annual profit of the Fund, which it was supposed to receive next to its expected Profitability benchmark.

6.5. Other fees and expenses paid from the Fund's assets:

• Fee to the Fund's custodian;
• Fee to the Fund's registrar;
• Fee to the Fund's auditor;
• Fee to the Fund's independent property appraiser;
• Fee to securities traders;
• Operating expenses incurred in connection with the functioning of the Fund, including:
• Registration services (state duties and other similar services);
• Manufacturing of forms for the Fund's securities;
• Payment for banking services;
• Notary services;
• Depositary services;
• Payment for publications of the required information on the Fund's activities;
• Informational services (payment for acquiring information regarding the issuers in the securities of which the Fund has allocated or plans to allocate its assets; payment for other information required for collective investment).
• Rental payments;
• Expenses for maintenance of real-estate, which is included to the Fund’s assets, including expenses on minor repair works, payments for re-registration of property rights on real-estate, land tax and so on;
• Advertising services associated with circulation of the Fund's securities;
• Expenses for servicing the Fund's participants and circulation of securities.

6.6. Expenses specified in item 6.5 of the Regulations may not exceed 5 (five) percent of the Fund's annual average net asset value during the fiscal year, calculated according to regulatory acts of the Commission.

6.7. The Company, from its own account, pays for other expenses and expenses exceeding the amount specified in item 6.6 of the Regulations.

7. The procedure of Fund's profit distribution.

7.1. Net profit, received after legal payments, remains at Fund’s disposal.

7.2. The General Shareholders meeting can take decision to pay dividends to the Fund’s shareholders. The dividends can be paid once a year by the results of the fiscal year.

7.3. Amount of dividends is determined by the General meeting of the Fund’s shareholders at the suggestion of the Supervisory Board.

8. Procedure and terms of the shares redemption.

8.1. Shares are redeemable at the end of the term of the Fund at the price based on the net asset value.

8.2. Shares are redeemable on the base of application for the shares redemption received from shareholder (“Application for sale”).

8.3. Shares are redeemable at the prices, which are the same for all shareholders, set up on the definite date based on the net asset value, unless directly and unambiguously stipulated otherwise by current legislature.

8.4. The Fund is also entitled to redeem the shares before termination of its activity if such decision was made by General Shareholders meeting (about redemption of shares).

8.5. The application for sale is accepted not earlier than in 3 years from the date of the Fund’s registration as a collective investment institution.

8.6. The application for sale is accepted on the 4-th and 18-th day of each month. In case, the day of accepting application coincides with a holiday, the application for sale is accepted on the 1-st working day after the dates mentioned above.

8.7. The application for sale is accepted in case the Fund has available money funds, received from the rent of the real-estate objects (rent payments) and/or selling of the real-estate objects or other assets of the Fund.

8.8. The shares are redeemable before the termination of the Fund’s activity through the following procedure:

8.8.1. Before 11am on the day when Application for sale is accepted shareholder submits the Company a Note about the intention of selling the Fund’s shares (“The Note”), specifying the amount of the shares to be redeemed.

8.8.2. Before 12am the Company notifies the Shareholder about:

• consent to redeem shares, or
• consent to redeem less amount of shares than stated in the Note, or
• refusal to redeem shares.

8.8.3. In case if within terms, specified in item 8.8.1. of these Regulations, several Notes were submitted to the Company, the redemption is made on the proportionate basis proceeding from the availability of free cash.

8.8.4. In case the Company agrees to redeem the Fund’s shares, or agrees to redeem less amount of the Fund’s shares, defined in the Company’s answer to Note, a Shareholder within one hour from the moment of receiving an answer to Note submits the Company an Application for sale of a corresponding amount of the Fund’s shares.

8.8.5. After the application for sale is received, the Company signs a sale agreement with a shareholder.

8.8.6. The term between submitting of application for sale by shareholder and the date of settlements must not exceed 7 calendar days.

8.9. The application for sale is irrevocable.

9. Investment targets

Investment targets are determined in the Fund's Investment Declaration, which is a constituent part to the Regulations (See: Investment Declaration, Attachment 1 to the Regulations).

10. Minimum value of contracts (agreements) involving the Fund's assets subject to approval by the Fund's Supervisory Board.

The contracts on the Fund's assets exceeding 50,000 (fifty thousand) minimum wages at the date of signing the contract (or the equivalent in foreign currency) are subject to approval by the Fund's Supervisory Board.

Attachment 1
to the Regulations
of the Open Joint Stock Company
Closed-End Non-Diversified
Corporate Investment Fund
"Synergy Real Estate"

INVESTMENT DECLARATION
Open Joint Stock Company,
Closed-End Non-Diversified Corporate
Investment Fund
"Synergy Real Estate"

1. Full name of the Fund - Open Joint Stock Company, Closed-End Non-Diversified Corporate Investment Fund "Synergy Real Estate".

2. The Fund was founded according to the decision of the Open Joint Stock Company, Closed-End Non-Diversified Corporate Investment Fund "Synergy Real Estate" Constituent Assembly meeting (Minutes No.1 dated 14 April, 2005).

3. The objective of the Fund's activity is maximum appreciation of capital through medium- and long-term investment in Ukrainian real-estate, developer’s projects and securities.

4. The Fund's assets may comprise:

• Real-estate objects;
• Securities;
• Cash, including foreign currency;
• Other assets provisioned by current legislature of Ukraine.

5. The Fund asset structure should meet all the requirements established by current legislation on non-diversified corporate investment funds.

6. Restrictions stipulated by item 5 of the Investment declaration are implemented in 6 (six) months after the date of the Fund's registration in the Unified state register of collective investment institutions.

7. While making a decision on purchasing the shares, the Investor must consider the following risks:

• Economic risks, including general not favourable economic development, inflation, general low liquidity of the securities market in Ukraine;
• Negative changes in legislation, including changes in tax regulations (cancellation of tax benefits, etc);
• Introduction of state of emergency, nationalization procedure, expropriation, new regulative acts about banking activity, privatization and securities circulation (which change conditions of securities and/or money circulation), cancellation or abeyance of the Asset management company or custodian licence, military operations, natural disasters, acts of civil disobedience, mass rallies, strikes, lock-outs, limitations on cash payments and on cashless settlement, imposed by banks, actions of state and local powers, actions of any state officials, emergence of any other events and/or juridical facts, that substantially influence on profitability of operations on Ukrainian stock market;
• Special risks of the Fund as institutional investor, including risks connected with insufficient protection of the minority shareholders rights, limited access to the information on the companies the securities of which are included in the Fund's portfolio, the risk of a possible bankruptcy, nationalization or re-privatization of company the securities of which are in the Fund's portfolio;
• Man-caused and natural calamities.

8. Profitability benchmark (the hurdle rate) is established at the level of the National Bank’s of Ukraine Discount Rate.

Section D. Information on the announced issuance of Fund's shares

1. Decision on the issuance of the Fund's shares with the aim of collective investment was taken on 19 July, 2005. (Minutes of the General Annual Meeting No.1).

2. Total nominal value of the Fund's shares to be placed - UAH 7, 250,000 (seven million twenty hundred fifty thousand).

3. Total number of Fund’s shares to be placed - 725 (seven hundred twenty five).

4. Nominal value of one share - UAH 10,000 (ten thousand).

5. Type of the shares – nominal shares.