Notice of EGM

RNS Number : 3133W

NB Global Floating Rate Income Fund

17 August 2020

 

17 August 2020

NB Global Floating Rate Income Fund Limited

(the "Company")

Notice of Extraordinary General Meeting

Following the Company's announcement of 5 August 2020 explaining the proposed changes to the investment policy and discount control mechanism of the Company, the Board is pleased to announce that it has today published a Circular to Shareholders containing details of the proposals and a Notice of Extraordinary General Meeting ("EGM") (the "Circular").  The Circular also contains details of a proposed cash exit offer to Shareholders for up to 40 per cent. of the issued share capital of the Company. Terms used and not defined in this announcement shall have the meanings given to them in the Circular published by the Company on 17 August 2020.

1.  INTRODUCTION AND BACKGROUND

Following consultation with Shareholders, the Board is proposing to make various changes to the Company's investment policy and operations (the "Proposals").

Proposed changes to the Company's investment policy

The Board proposes to amend the Company's investment policy to allow the Company to invest in a wider range of credit assets, including alternative credit, thereby leveraging the breadth of the Investment Manager's global platform and to support a move to pay income to Shareholders on a monthly basis. The recent backdrop of equity dividend cuts and reductions in bond yields has heightened income investors' needs for a portfolio designed to deliver predictable, ongoing monthly income at attractive levels.

The Company will retain its ability to invest in senior secured, floating rate loans but will also be able to invest in a broad range of other credit assets, including but not limited to high yield and investment grade bonds and alternative credit comprising of distressed debt, mezzanine debt and private corporate loans. Protection of capital will remain of paramount importance.

Proposed changes to the Company's discount management policy

The Board is also proposing a change to the existing discount control policy, whereby the current annual redemption offer mechanism will be replaced with a bi-annual tender. Under this facility, the Directors may, at their discretion, offer eligible Shareholders the opportunity to tender up to 25 per cent. of their Shares at a discount of 2 per cent. to NAV per Share on or around the 30 June and 31 December of each year, starting on or around 30 June 2022. The Company will no longer be subject to an annual continuation vote, but the Board intends to propose a wind-up of the Company should its NAV drop beneath £150 million.

Cash Exit Offer

At the same time as seeking approval from the Shareholders for the Proposals, the Company is offering all Shareholders a partial cash exit opportunity by way of a redemption offer (the "Cash Exit Offer"), which is conditional on the Proposals being approved.

Pursuant to the Cash Exit Offer, Shareholders will be entitled to elect to have up to 40 per cent. of their Shares held at the Record Date redeemed (the "Basic Entitlement"). Shareholders will be able to request that Shares in excess of their Basic Entitlement also be redeemed and these excess requests will be satisfied to the extent that other Shareholders request redemption of Shares in respect of less than the entirety of their Basic Entitlement, pro rata to the amount in excess of the Basic Entitlement which each relevant Shareholder has requested to redeem, rounded down to the nearest whole number of Shares.

The redemption price per Share redeemed pursuant to the Cash Exit Offer will be equal to the Company's published Net Asset Value per Share for the day preceding the Extraordinary General Meeting (the "NAV Determination Date"), less 2 per cent.

Benefits of the Proposals

The Board believes that the Proposals will have the following benefits for Shareholders:

· Result in an income focused, credit "best opportunities" Company, leveraging the breadth of the Investment Manager's fixed income platform and track record.

· Maintain exposure to senior secured floating rate loans.

· Provide Shareholders with consistent levels of monthly income, to commence following declaration of the Q3 2020 dividend.

· The Board will announce a target annualised distribution per Share at the commencement of each calendar year, expressed as both an annual percentage yield as well as a monthly distribution amount in Sterling, based on the Net Asset Value per Share as at the end of the preceding calendar year .

· Provide Shareholders with additional exposure to alternative credit which is intended to increase the risk-adjusted return profile of the Company.

· Underpinned by an initial cash exit offer and a new discount control mechanism.

· From end June 2022, the Board intends to propose a wind-up of the Company should its NAV drop beneath £150 million.

Following realignment of the Company's Portfolio, the Board expects to target an annual yield that is 100 to 200 basis points higher than would have been generated under the current investment policy over the full credit cycle.

Shareholder Approval Required

In connection with the Proposals outlined above, the Board has posted the Circular to Shareholders to convene the Extraordinary General Meeting to seek approval to adopt a proposed new investment policy (the "New Investment Policy") and to make related changes to the Company's name and adopt New Articles.

The Proposals are subject to approval by Shareholders at an Extraordinary General Meeting scheduled for 8 September 2020 at 2 p.m.

The following resolutions shall be put to Shareholders at the Extraordinary General Meeting:

· That the Company adopts the New Investment Policy ("Resolution 1").

· That the Company's name be changed to "NB Global Monthly Income Fund Limited" ("Resolution 2").

· That the Company adopts New Articles reflecting various changes to the Existing Articles including: (i) to remove the requirement for the Company to implement a redemption offer if the Shares trade at an average discount to the Net Asset Value per Share of greater than five per cent. over the last three months of any calendar year; (ii) to remove the requirement to hold an annual vote on the continuation of the Company; (iii) to amend the voting rights of the Shares so that each Share carries one vote on a poll at a general meeting of shareholders; and (iv) various updates to reflect current law and practice applicable to the Company ("Resolution 3").

Resolution 1 is being proposed as an Ordinary Resolution. Resolution 2 and Resolution 3 are being proposed as Special Resolutions. Approval of each Resolution will be conditional on the others also being passed.

The Circular sets out details of, and seeks your approval for, the Proposals and explains why the Board is recommending that you vote in favour of the Resolutions to be proposed at the Extraordinary General Meeting to be held on 8 September 2020. The notice in respect of the Extraordinary General Meeting is set out at the end of the Circular.

The Board notes that the U.S. Dollar Ordinary Shares were compulsorily converted into Sterling Ordinary Shares on 3 August 2020 and, as such, no class meetings will be required to effect the Proposals.

If the Proposals are approved, the Board will also implement a number of other changes to the operations of the Company that are described in further detail below.

Timings

The Board shall be entitled to defer any effective date specified in the Circular and the implementation of the Proposals in its absolute discretion to accommodate any legal, regulatory or operational requirements that are not resolved prior to or on the relevant effective date.

2.  CHANGE TO THE INVESTMENT POLICY AND OTHER RELATED CHANGES

The Company's existing investment policy reflects its investment objective, which is to invest mainly in non-investment grade floating rate senior secured loans issued in U.S. Dollars, Sterling and Euros by primarily North American and European Union corporations, partnerships and other business issuers.

The Board is seeking Shareholder approval for the New Investment Policy set out below. The adoption by the Company of the New Investment Policy is conditional on Shareholder approval. The proposed New Investment Policy has been approved by the Financial Conduct Authority, subject to Shareholder approval.

The New Investment Policy will be as follows:

"Investment Objective

The Company's investment objective is to provide its shareholders with consistent levels of monthly income, while maintaining or increasing the Net Asset Value per Share over time.

Investment Policy

To pursue its investment objective, the Company will invest in credit assets with the following target portfolio allocations: (i) 50-70% in traditional credit, meaning high yield bonds, floating rate loans and investment grade corporate bonds; and (ii) 30-50% in alternative credit, meaning "special situations" (consisting generally of tradeable but less liquid debt securities, such as stressed credit and CLO debt tranches), mezzanine debt, "club" loan transactions (being syndicated lending opportunities presented through the Company's or Investment Manager's relationship with loan arrangers and/or borrowers) and private corporate loans issued directly to borrowers. Investments in alternative credit will not represent more than 50% of Net Asset Value at the time of investment.

The Company's investments will be issued in U.S. Dollars, Sterling and Euros by corporations, partnerships and other business issuers based primarily in North America, the UK and Europe. At the time of investment these loans, bonds and other debt instruments will often be non-investment grade.

The Company expects that it will typically hold the majority of its assets directly, however where the Investment Manager considers it appropriate the Company may obtain investment exposure to loans, bonds and other debt instruments through investments in other collective investment vehicles. The Company will not invest more than 15 per cent. of its total assets in other listed closed-ended investment funds at any time.

Diversification

The Investment Manager seeks to manage risk through in-depth credit research utilising proprietary analytical processes, diversifying across industries, companies and investment size and adjusting sector weightings based on economic and market analysis.

The Company's portfolio of investments is intended to focus on those industries regarded as defensive. Defensive industries are those the Investment Manager believes are less affected by changes in economic conditions and likely to demonstrate the strongest capital preservation. Typically, no industry will represent more than 15 per cent. of Net Asset Value at the time of investment.

At the time of investment, no more than 5 per cent. of Net Asset Value shall be concentrated in a single issuer.

Gearing and derivatives

The Company may use derivatives for hedging as well as for efficient portfolio management, including managing currency risks between cash flows from its investments and Sterling being the currency of the Shares. The Company is expected to be managed primarily on an ungeared basis, however the Company may, from time to time, be geared tactically through the use of borrowings for investment and short-term liquidity purposes. The Directors will restrict borrowing to an amount not exceeding 20 per cent. of Net Asset Value at the time of drawdown.

Changes to the Company's investment policy

Any material change to the Company's investment policy will be made only with the approval of the Shareholders."

Shareholders should note that under the New Investment Policy the Company will invest to a greater extent in high yield bonds as well as in alternative credit (such as "special situations") which it does not do under its existing investment policy. Shareholders should note that the credit risk of investing in these types of assets can be greater than the senior secured loans which the Company primarily invests in currently.

3.  TARGET DISTRIBUTION

If the Proposals are approved, the Directors intend to publish on or around 1 January of each calendar year a target distribution amount per Share (the "Target Distribution") for that calendar year based on market conditions at the relevant time. The Target Distribution shall be expressed as both an annual percentage yield, based on the Net Asset Value per Share as at 31 December of the preceding calendar year, as well as a monthly distribution amount per Share in Sterling. The Board expects to announce the Target Distribution for the calendar year 2021 (and an expected dividend timetable) on or around 1 January 2021, by which time it is expected that the Company's Portfolio will have been realigned in accordance with the New Investment Policy. The Directors currently expect that following realignment of the Company's Portfolio in accordance with the New Investment Policy, the Target Distribution will be 100 to 200 basis points higher than would have been generated under the current investment policy over the full credit cycle.

Shareholders should note that the actual yield generated by the Company in pursuing its investment objective will,  however, depend on a wide range of factors including, but not limited to, general economic and market conditions, fluctuations in currency exchange rates, prevailing interest rates and credit spreads, and the terms of the investments made by the Company.

The Target Distribution should not be taken as an indication of the Company's expected future performance or results over such period. The Target Distribution is a target only and there is no guarantee that it can or will be achieved and it should not be seen as an indication of the Company's expected or actual return.

4.  DIVIDEND POLICY

If the Proposals including the New Investment Policy are approved at the Extraordinary General Meeting, the Company will move from paying dividends quarterly to monthly following payment of the Q3 2020 dividend.  With effect from 1 January 2021, the Company will seek in each financial year to distribute amounts to Shareholders by way of monthly dividends equal in aggregate to the Target Distribution for that year. The Board expects that dividends will be paid out of Cash Income and Investment Profits of the Company.

Following the implementation of the Proposals and realignment of the Company's Portfolio in accordance with the New Investment Policy, it is anticipated that a distribution will be made by way of a dividend with respect to each calendar month (instead of the current quarterly basis) in accordance with the expected dividend timetable published by the Company.  It is the intention of the Board that the monthly dividends shall be paid in approximately equal amounts, to the extent that this is possible.

The Company currently operates a dividend re-investment plan (the "DRIP"), pursuant to which Shareholders may elect to re-invest their cash dividends by purchasing further Shares. It is the Board's intention that the DRIP shall be discontinued following payment of the Q3 2020 dividend and the consequent transition to monthly dividend distributions. 

5.  MANAGEMENT FEE

The Company and the Investment Manager will enter into an amendment agreement (the "IMA Amendment Agreement") in respect of the amended and restated investment management agreement dated 16 July 2014. Pursuant to the IMA Amendment Agreement, the investment management fee payable to the Investment Manager shall be amended from the current flat rate of 0.65 per cent. of NAV per annum to a tiered management fee as follows:

NAV amounts of the Company	Applicable rate of management fee to such NAV amount
Up to £500 million	0.75 per cent. of NAV per annum
Between £500 million and up to £750 million	0.70 per cent. of NAV per annum
Between £750 million and up to £1 billion	0.65 per cent. of NAV per annum
Above £1 billion	0.60 per cent. of NAV per annum

The IMA Amendment Agreement shall come into effect on approval of the Proposals by Shareholders at the Extraordinary General Meeting. The increase to the investment management fee reflects the increased complexity of the Portfolio if the Proposals are approved.

6.  DISCOUNT MANAGEMENT AND DISCRETIONARY REGULAR CASH EXIT FACILITY

If the Proposals are approved by Shareholders at the Extraordinary General Meeting, the Directors expect that, although the Company will continue to seek annual authority from Shareholders to make market purchases of its own Shares, the extent of market purchases of Shares by the Company will, if made at all, reduce significantly as compared to recent years.

In addition, it is proposed that the current requirements in the Existing Articles that the Company implement a redemption offer if the Shares trade at an average discount to the Net Asset Value per Share of greater than five per cent. over the last three months of any calendar year and to hold an annual vote on the continuation of the Company will be removed. Instead, the Company will operate a regular discretionary cash exit facility (the "Cash Exit Facility").

Pursuant to the Cash Exit Facility, the Company may, at the Board's absolute discretion, offer to eligible Shareholders the opportunity to tender up to 25 per cent. of their holdings (a "Cash Exit Facility Offer") at a price equal to the prevailing Net Asset Value per Share, less two per cent. If the Board resolves to exercise its discretion (as they expect to do if the Company is trading at a discount to NAV per Ordinary Share of greater than 2 per cent. as at the date of any Cash Exit Facility Offer), the first Cash Exit Facility Offer is expected to close on 30 June 2022 and subsequent Cash Exit Facility Offers every six months thereafter. Further details and the terms and conditions applicable to the first Cash Exit Facility Offer will be published in a Shareholder circular (the "Cash Exit Facility Circular"). In connection with any subsequent Cash Exit Facility Offers, the Company will publish an RIS announcement notifying Shareholders of the Board's decision to make a Cash Exit Facility Offer on the basis of the terms and conditions as previously set out in the Cash Exit Facility Circular.

7.  OTHER OPERATIONAL CHANGES

If the Proposals are approved and the New Investment Policy is adopted by the Company, the Company will no longer measure its performance against its current benchmark, the S&P/LSTA Leveraged Loan Index. It is not currently intended to replace this benchmark.

8.  CHANGE TO THE COMPANY'S NAME

The Company's current name reflects its existing investment policy. Consequently, in connection with the proposed adoption of the New Investment Policy, the Board is proposing that the name of the Company be changed from "NB Global Floating Rate Income Fund Limited" to "NB Global Monthly Income Fund Limited".

The change to the Company's name requires Shareholder approval. Shareholders are, therefore, being asked at the Extraordinary General Meeting to approve the change to the Company's name, subject to Shareholder approval of all other Proposals.

Shareholders who hold their Shares in certificated form (that is, not in CREST) should note that their existing share certificates will remain valid following the change of name and the Company does not intend to issue replacement share certificates in the Company's new name.

9.  ADOPTION OF NEW ARTICLES

In connection with the proposed adoption of the New Investment Policy, the Company proposes to adopt the New Articles in place of the Existing Articles. The material amendments proposed to be made in addition to those already outlined above are summarised below:

Votes per Ordinary Share

Following the compulsory conversion of the U.S. Dollar Ordinary Shares into Sterling Ordinary Shares on 3 August 2020, there is no longer any need to distinguish between the voting rights of different classes of Ordinary Shares. Accordingly, it is proposed that the voting rights attached to Ordinary Shares have been standardised so that each Ordinary Share carries one vote on a poll at a general meeting of Shareholders.

Other changes

Other changes reflected in the New Articles generally include recent developments in legal, regulatory and/or market practice such as:

· Provisions relating to the conversion of Ordinary Shares have been removed following the recent compulsory conversion of the U.S. Dollar Ordinary Shares into Sterling Ordinary Shares.

· Provisions pertaining to the transfer and transmission of uncertificated shares have been updated to reflect, amongst other things, the application of The Uncertificated Securities (Guernsey) Regulations 2009.

· Requirements for the Directors to be tax resident outside the United Kingdom have been removed following changes to UK tax legislation and practice.

· Introduction of references to "AML Legislation", "Data Protection Legislation" and "International Tax Compliance Legislation" (as those terms are defined in the New Articles), which legislation is applicable to the Company.  These provisions empower the Board to request information and documentation from Shareholders to ensure the Company complies with its obligations under such legislation. Persons who do not comply with such requests for information or whose ownership of shares may result in the Company not being able to satisfy its obligations under AML Legislation or International Tax Compliance Legislation may be designated as "Non-Qualified Holders" with the Board having the remedies against such persons (as are already included in the Existing Articles) including compulsory sale/transfer or forfeiture of shares and suspension of rights.

· New articles providing greater clarity around the use of written resolutions (in lieu of general meetings) and disclosure of directors' interests which reflect the current requirements of the Companies Law have also been included.  A new article addressing the procedure for the issue of scrip dividends (in case the Board chooses to offer a scrip dividend alternative to Shareholders when a cash dividend is declared from time to time) has also been included.

These amendments will be effected by substituting the Existing Articles with the New Articles. The adoption of the New Articles requires the approval of Shareholders and is conditional on adoption of all other Proposals.

10. CASH EXIT OFFER

Conditional on obtaining the necessary Shareholder approvals for the Proposals, the Board will provide Shareholders (other than Shareholders in certain jurisdictions as described in paragraph 2 in Part II of the Circular) with the opportunity to realise a proportion of their investment in the Company by way of redemption of a Basic Entitlement of up to 40 per cent. of their Shares through participation in the Cash Exit Offer, with the Company facilitating requests in excess of the Basic Entitlement to the extent other Shareholders have not elected to take up their Basic Entitlement. Further details of how the Cash Exit Offer will operate are set out below.

Shareholders should note that the issued share capital of the Company will be reduced as a result of the Cash Exit Offer to the extent that Shares are redeemed. Consequently, the fixed costs of the Company will be spread over fewer Shares.

Mechanics of the Cash Exit Offer

Pursuant to the Cash Exit Offer, Shareholders will be entitled to elect to have their Basic Entitlement of  Shares as at the Record Date (being 8 p.m. on 4 September 2020) redeemed. Shareholders will be able to request that Shares in excess of their Basic Entitlement also be redeemed and these excess requests will be satisfied to the extent that other Shareholders request redemption of Shares in respect of less than the entirety of their Basic Entitlement, pro rata to the amount in excess of the Basic Entitlement which each relevant Shareholder has requested to redeem, rounded down to the nearest whole number of Shares

A Shareholder who requests the redemption of part of their holding of Shares pursuant to the Cash Exit Offer will need to submit a Redemption Notice for Shares held in certificated form or TTE Instruction(s) for Shares held in uncertificated form for the number of Shares that they wish to offer for redemption by 1 p.m. on 4 September 2020. 

Details on submitting Redemption Notices and TTE Instruction(s) are set out in paragraph 1 in Part II of the Circular.

Proceeds of the Cash Exit Offer

Subject to the necessary Shareholder approvals being obtained at the Extraordinary General Meeting, following the receipt of the Redemption Notices and/or TTE Instruction(s) from Shareholders, the Shares to be redeemed pursuant to the Cash Exit Offer will be redeemed on the Cash Exit Redemption Date (being the date of the Extraordinary General Meeting). The redemption price per share that a redeeming Shareholder will receive pursuant to the Cash Exit Offer will be equal to the Company's published Net Asset Value per Share as at the NAV Determination Date, less 2 per cent. (the "Redemption Price").

Absent any unforeseen circumstances and subject to general market conditions, the Company expects to realise assets for the purposes of meeting redemption requests under the Cash Exit Offer and to be in receipt of the proceeds of such realisations within 10 Business Days of the Cash Exit Redemption Date. Payment of the Redemption Price to each Shareholder redeeming Shares will be made within 10 Business Days of the Registrar receiving such realisation proceeds from the Company.

The redemption of the Shares pursuant to the Cash Exit Offer will constitute a distribution for the purposes of the Companies Law. Accordingly, the Board will follow the procedure for making a distribution set out at section 303 of the Companies Law and will consider the statutory solvency test set out therein. The redemption of the Shares pursuant to the Cash Exit Offer is therefore subject to the Directors being satisfied that the provisions of section 303 of the Companies Law are satisfied at the relevant time.

Termination of the Cash Exit Offer

If the number of Shares which Shareholders request to redeem pursuant to the Cash Exit Offer is such that the Board is of the view that the continuance of the Company is not in the best interests of Shareholders, it reserves the right to terminate the Cash Exit Offer. In such circumstances, the Cash Exit Offer will not proceed and instead the Company will put forward further proposals to the Shareholders. The Company will make an announcement through an RIS in the event that the Cash Exit Offer is terminated.

Details regarding the tax consequences of the Proposals are set out in paragraph 3 in Part II of the Circular.

11. RISK FACTORS RELATING TO THE CASH EXIT OFFER

Shareholders should, when considering participating in the Cash Exit Offer, have regard to the following risk factors.

· Once a Redemption Notice has been served on the Company or a TTE Instruction(s) has been submitted, the relevant Shareholder will be unable to access or otherwise deal in those Shares pending completion of the Cash Exit Offer. Shares will be held in escrow subject to the completion of the Cash Exit Offer. In the case of Shareholders who hold their Shares in certificated form (that is, not in CREST), the restriction on dealing shall also apply in respect of all Shares to which any surrendered share certificates relate, whether or not the relevant Shareholder has requested their redemption pursuant to the Cash Exit Offer. In the case of Shareholders who hold their Shares in uncertificated form (that is, in CREST), the restriction on dealing shall also apply to any Shares transferred to escrow in excess of the relevant Shareholder's Basic Entitlement, which as a result may ultimately not be eligible for redemption. A Redemption Notice or TTE Instruction(s), once submitted, may only be withdrawn with the consent of the Company.

· Securities laws in certain jurisdictions, in particular the United States, Canada, Australia and Japan, may prevent certain Shareholders from participating in the Cash Exit Offer. For more information, please refer to paragraph 2 in Part II of the Circular.

12. EXTRAORDINARY GENERAL MEETING

The Proposals are subject to Shareholder approval. A Notice convening the Extraordinary General Meeting, to be held on 8 September 2020 at 2 p.m. at the offices of Praxis Fund Services Limited at Sarnia House, Le Truchot, St Peter Port, Guernsey, GY1 1GR, is set out at the end of the Circular. The Notice includes the full text of the Resolutions.

In order to become effective, Resolution 1, which is being tabled at the Extraordinary General Meeting as an Ordinary Resolution, must be approved by a simple majority of the votes cast by Shareholders present in person or by proxy at the Extraordinary General Meeting. Resolution 2 and Resolution 3, which are being tabled at the Extraordinary General Meeting as Special Resolutions, shall require approval by a majority of not less than seventy five per cent. of the votes cast by Shareholders present in person or by proxy at the Extraordinary General Meeting. Each Resolution will be conditional on the approval of all other Resolutions.

The quorum for the Extraordinary General Meeting shall be two or more Shareholders present in person or represented by proxy and entitled to vote at the Meeting. If within half an hour after the time appointed for the Extraordinary General Meeting a quorum is not present, the meeting shall stand adjourned for five Business Days at the same time and place or to such other day and at such other time as the Board may determine, whereupon those Shareholders then present in person, by their representative or by proxy, shall form the quorum. No notice need be given in the event of any such adjournment.

13. ACTION TO BE TAKEN BY SHAREHOLDERS IN CONNECTION WITH THE MEETING

Whether or not you intend to be present at the Extraordinary General Meeting, you are requested to return a Proxy Appointment by one of the following methods: (i) in hard copy form by post, by courier or by hand to Link Asset Services, PXS, 34 Beckenham Road, Beckenham, Kent BR3 4TU; (ii) by logging on to Signal Shares (www.signalshares.com) and following the instructions; or (iii) in the case of CREST members, by utilising the CREST electronic proxy appointment service.

The completion and return of a Proxy Appointment will not preclude you from attending the Extraordinary General Meeting and voting in person if you wish to do so.

Shareholders are requested to consider and vote on the Resolutions set out in the Notice of the Extraordinary General Meeting set out at the end of the Circular in person or by proxy, at or before the Extraordinary General Meeting to be held at the offices of Praxis Fund Services Limited at Sarnia House, Le Truchot, St Peter Port, Guernsey, GY1 1GR on 8 September 2020 at 2 p.m.

If the Resolutions are not approved at the Extraordinary General Meeting, the Company will continue to be managed in accordance with its existing investment policy and the Cash Exit Offer will not proceed.

Shareholders should note that, if they wish to participate in the Cash Exit Offer, further action is required to be taken by them. Information on such action to be taken by Shareholders seeking to participate in the Cash Exit Offer is set out in Part II of the Circular.

14. DOCUMENTS AVAILABLE FOR INSPECTION

A copy of the Existing Articles and the New Articles will be available for inspection at the offices of Herbert Smith Freehills LLP, Exchange House, Primrose Street, London EC2A 2EG and at the registered office of the Company during normal business hours on any Business Day (Saturdays and public holidays excepted) from the date of the Circular until the conclusion of the Extraordinary General Meeting and at the place of the Extraordinary General Meeting for at least 15 minutes prior to, and during, the Extraordinary General Meeting. A copy of the Existing Articles and the New Articles will also be available on the Company's website: https://www.nbgfrif.com .

A copy of the Circular has been submitted to the National Storage Mechanism and will shortly be available for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism . The Circular will also be available on the Company's website: https://www.nbgfrif.com .

15. COVID-19 AND RELATED MEASURES

The Board notes that due to the impact of COVID-19, it will be challenging to hold the Extraordinary General Meeting in the format typically expected by Shareholders. The location of the Extraordinary General Meeting may need to be reconsidered closer to the time and the Company will update Shareholders of any changes via a Regulatory Information Service announcement and details on the Company's website.

The States of Guernsey introduced measures with effect from 25 March 2020 prohibiting travel and gatherings of people subject to certain limited exceptions.  Many of those restrictions were relaxed with effect from 30 May 2020, and further relaxed from 20 June 2020, but it remains the case as of the date of the Circular that any person travelling to Guernsey would be required by law to self-isolate for 7 to 14 days following their arrival (depending on the country from which they are travelling). Further, it remains possible that restrictions on gatherings within Guernsey will be re-instated if there is a resurgence of COVID-19 cases in the Bailiwick. 

In light of the travel restrictions in place as at the date of the Circular and the possibility that restrictions on gatherings within Guernsey will be re-instated if there is a resurgence of COVID-19 cases in the Bailiwick, Shareholders are asked not to attempt to attend the Extraordinary General Meeting in person and instead appoint the chairman of the Extraordinary General Meeting to act as their proxy in casting votes in accordance with the Shareholder's instruction.

Shareholders are invited to participate in the Extraordinary General Meeting by submitting any questions in advance and/or joining via the telephone conference dial-in facilities being established. Any specific questions on the business of the Extraordinary General Meeting can be submitted (with details of the shareholding) by no later than 2 p.m. on 4 September 2020 (or any adjournment thereof) by email to [e-mail]. Details of how to access the dial-in facilities will be provided to Shareholders on application to the same email address.

16. RECOMMENDATION

The Board considers that the Proposals are in the best interests of the Company and of Shareholders as a whole. Accordingly, the Board unanimously recommends Shareholders to vote in favour of the Resolutions to be proposed at the Extraordinary General Meeting. The Directors intend to vote (or, as the case may be, procure the voting of) their beneficial holdings in favour of the Resolutions in respect of their aggregate holding, including persons closely associated, of 135,740 Shares. The Directors do not intend to participate in the Cash Exit Offer in respect of those Shares held by them.

Yours faithfully

Rupert Dorey

Chairman

17 August 2020

Expected Timetable

EXTRAORDINARY GENERAL MEETING
Circular sent to Shareholders	17 August 2020
Latest time and date of receipt of Proxy Appointments for the Extraordinary General Meeting	2 p.m. on 4 September 2020
Extraordinary General Meeting	2 p.m. on 8 September 2020
Announcement of results of the Extraordinary General Meeting	8 September 2020
CASH EXIT OFFER
Latest time and date for receipt of Redemption Notices and TTE Instructions for the Cash Exit Offer	1 p.m. on 4 September 2020
Record Date	8 p.m. on 4 September 2020
NAV Determination Date	7 September 2020
Announcement of results of the Cash Exit Offer	8 September 2020
Cash Exit Redemption Date	8 September 2020
Payment of the Redemption Price*	Within 10 Business Days of the Registrar receiving the proceeds of the Company's assets realised pursuant to the Cash Exit Offer**

*Certificated Shareholders will be paid by cheque despatched at the latest known address as indicated on the Shareholders' register. Uncertificated Shareholders will be paid via CREST.

**Absent any unforeseen circumstances and subject to general market conditions, it is currently expected that the Registrar will be in receipt of the proceeds within 10 Business Days of the Cash Exit Redemption Date.

The EGM will be at the Company's registered office, Sarnia House, Le Truchot, St Peter Port, Guernsey, on 8 September 2020 at 14.00hrs .

The Circular has been dispatched to all shareholders. An electronic copy is also available on the Company's website: www.nbgfrif.com and will shortly be available for inspection on the National Storage Mechanism: https://data.fca.org.uk/#/nsm/nationalstoragemechanism .

Enquiries:

Neuberger Berman Europe Limited (Manager) Elizabeth Papadopoulos Praxis Fund Services Limited (Company Secretary) Matt Falla Gemma Woods

[phone] [phone]

LEI: 549300P4FSBHZFALLG04

 

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