Proposed Placing

RNS Number : 3932A

Residential Secure Income PLC

02 February 2022

 

THIS ANNOUNCEMENT, INCLUDING THE APPENDIX AND THE INFORMATION CONTAINED HEREIN, IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, TO US PERSONS, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, HONG KONG, JAPAN, NEW ZEALAND, THE REPUBLIC OF SOUTH AFRICA, ANY MEMBER STATE OF THE EUROPEAN ECONOMIC AREA OR INTO ANY OTHER JURISDICTION WHERE TO DO SO MIGHT CONSTITUTE A VIOLATION OR BREACH OF ANY APPLICABLE LAW OR REGULATION. PLEASE SEE THE IMPORTANT NOTICE AT THE END OF THIS ANNOUNCEMENT.

FURTHER, THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS NOT AN OFFER OF SECURITIES IN ANY JURISDICTION.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.

2 February 2022

RESIDENTIAL SECURE INCOME PLC

Proposed Placing

The Board of Directors (the "Board") of Residential Secure Income plc (ticker: RESI) (the "Company" or "ReSI") , which invests in independent retirement living and shared ownership to deliver secure, inflation-linked returns , today announces a proposed placing of new ordinary shares ("Placing Shares") in the Company to institutional investors (the "Placing").

The Placing is being conducted through an accelerated bookbuild which will be launched immediately following release of this announcement by Jefferies International Limited ("Jefferies").

In addition to the Placing, there will be a separate offer made by the Company of new ordinary shares in the Company via the PrimaryBid platform (the "Retail Offer Shares") at the Placing Price (as defined below) (the "Retail Offer"), to provide retail investors in the UK only with an opportunity to acquire Retail Offer Shares. A separate announcement will be made shortly regarding the Retail Offer and its terms.

It is intended that the Placing and the Retail Offer (together, the "Issue") will result in the Company raising gross proceeds of up to a maximum of £20 million. The total number of Placing Shares and Retail Offer Shares (together, the "New Ordinary Shares") is expected to represent up to approximately 11% of the Company's existing issued ordinary share capital.

Issue highlights

· Proposed Issue to raise gross proceeds of up to a maximum of £20 million, representing up to approximately 11% of the Company's issued share capital at an issue price of 108.5 pence per New Ordinary Share (the "Placing Price").

· The Placing Price represents a premium of 1.3% to the unaudited ex-dividend EPRA NTA per Ordinary Share of 107.11 pence as at 31 December 2021 (reflecting the 31 December 2021 unaudited EPRA NTA of 108.4 pence reduced by the dividend of 1.29 pence per share declared on 27 January 2022).

· The net proceeds of the Issue (the "Net Proceeds"), together with associated leverage, will be used to finance up to £39 million of shared ownership transactions which are currently in legals.

· The transactions will provide secure, long-dated, RPI-linked income with social impact and are expected to be accretive to both the Company's current shared ownership portfolio valuation yield and to earnings with the target leases benefitting from annual uncapped RPI (or higher) rental uplifts.

· The New Ordinary Shares will be entitled to the next quarterly dividend declared by the Company for the quarter ending 31 March 2022 (expected to be 1.29 pence, in line with the Company's FY22 dividend target of 5.16 pence[1]) however will not be entitled to the dividend declared on 27 January 2022 in relation to the quarter ended 31 December 2021.

Ben Fry, Head of Housing at Gresham House, said:

"Demand for our core shared ownership and retirement housing remains strong, and the outlook for inflation-linked portfolio income is very positive.  We are today seeking to raise up to a maximum of £20 million of equity to assist in financing up to £39 million of accretive shared ownership transactions which should help drive future income and capital growth in the portfolio."

"As UK house prices continue to rise, and the population ages, the supply of affordable homes continues to tighten, particularly for our target customers in the under-served areas of shared ownership or retirement.  Owning our own Registered Provider of social housing means we are eligible for the government grants that subsidise this important social benefit, as well as providing the robust governance that benefits our shareholders, residents and wider stakeholders."

Use of proceeds

The net proceeds of the Issue, together with associated leverage from the ReSI group's ultra-long term debt facility, will be used to finance up to £39 million of shared ownership transactions comprising 272 completed homes primarily located in Southern England. 

The acquisitions are expected to be made at an average 14% purchase discount to vacant possession value and a net initial yield of 3.5% which is accretive to the Company's current shared ownership portfolio valuation yield of 3.0% as at 31 December 2021. The majority of the assets will be tenanted and immediately income generating on acquisition.

The average unexpired lease term of the shared ownership leases in the target portfolios is expected to be in excess of 100 years with the target portfolio expected to benefit from annual uncapped RPI (or higher) rental uplifts, which would be earnings accretive, with shared ownership homes underpinned by the homebuyer's equity stake in their home. Residents typically benefit from discounts of over 40% to market rents which is subsidised by £5 million of government grant, comprising a significant social dividend to ReSI's customers.

The acquisitions are expected to increase the Company's exposure to shared ownership assets from 30% of the portfolio to 37% of the portfolio (by gross asset value as at 31 December 2021). The Company has a further pipeline of shared ownership transactions, valued at approximately £145 million, on which it is in discussions.

Details of the Placing

Jefferies is acting as sole bookrunner to the Company in connection with the Placing.

The Placing is subject to the terms and conditions set out in the appendix to this announcement (which forms part of this announcement, together the "Announcement"). The Retail Offer will be made on the terms outlined in a separate announcement to be made shortly regarding the Retail Offer and its terms.

Jefferies will today commence a bookbuilding process in respect of the Placing (the "Bookbuild"). The book will open with immediate effect following this Announcement. The timing of the closing of the book and allocations are at the discretion of Jefferies and the Company. Details of the number of Placing Shares and the number of Retail Offer Shares will be announced as soon as practicable after the close of the Bookbuild.

The New Ordinary Shares will rank pari passu in all respects with the existing Ordinary Shares and each other, and will rank in full for all dividends made, paid or declared in respect of the Ordinary Shares by reference to a record date after their issue, including the next quarterly dividend for the quarter ending 31 March 2022 which is expected to be declared in May 2022. For the avoidance of doubt, the New Ordinary Shares will not be entitled to the dividend declared on 27 January 2022 in relation to the quarter ended 31 December 2021.

The Issue is not underwritten. The number of New Ordinary Shares to be issued shall not exceed 18,433,179. The Placing may be scaled back by the Company for any reason.

Applications will be made to the FCA for the New Ordinary Shares to be admitted to the premium listing segment of the Official List and to the London Stock Exchange for the New Ordinary Shares to be admitted to trading on its main market for listed securities ( "Admission") . It is expected that Admission will become effective on 7 February 2022 and that dealings in the New Ordinary Shares will commence at 8.00 a.m. on the same day.

The Placing is conditional, among other things, upon Admission becoming effective and the placing agreement entered into today between, amongst others, the Company, ReSI Capital Management Limited (the "FundManager") and Jefferies (the "Placing Agreement") not being terminated in accordance with its terms. The appendix sets out further information relating to the Bookbuild and the terms and conditions of the Placing.

Prior to launch of the Placing, the Company consulted with a significant number of its shareholders to gauge their feedback as to the proposed terms of the Placing. Feedback from this consultation was supportive and as a result the Board has chosen to proceed with the Placing. The Placing is being structured as a Bookbuild to minimise execution and market risk. The Board intends to apply the principles of pre-emption when allocating Placing Shares to existing shareholders that participate in the Placing. The New Ordinary Shares will be issued pursuant to the allotment and disapplication of pre-emption authorities that Shareholders granted to the Company at its annual general meeting on 14 January 2022.

This Announcement should be read in its entirety. In particular, you should read and understand the information provided in the "Important Notices" section of this Announcement.

FOR FURTHER INFORMATION, PLEASE CONTACT:

ReSI Capital Management Limited / Gresham House Housing Ben Fry Alex Pilato	[phone]
Jefferies International Limited Stuart Klein Tom Yeadon	[phone]
KL Communications Charles Gorman Will Sanderson Millie Steyn	[e-mail] [phone]

NOTES

Residential Secure Income plc (LSE: RESI) is a real estate investment trust (REIT) focused on delivering secure, inflation-linked returns with a focus on two resident sub-sectors in UK residential - independent retirement rentals and shared ownership - underpinned by an ageing demographic and untapped and strong demand for affordable home ownership.

ReSI targets a secure, long-dated, inflation-linked dividend of 5.16 pence per share p.a.¹ (paid quarterly) and a total return in excess of 8.0% per annum. Including recently committed acquisitions, ReSI's portfolio comprises 3,050 properties, with an (unaudited) IFRS fair value as at 31 December 2021 of £351m ².

ReSI's purpose is to deliver affordable, high quality, safe homes with great customer service and long-term stability of tenure for residents. We achieve this through meeting demand from housing developers, housing associations, local authorities and private developers for long-term investment partners to accelerate the development of socially and economically beneficial affordable housing.

ReSI's subsidiary, ReSI Housing Limited, is registered as a for-profit Registered Provider of social housing, and so provides a unique proposition to its housing developer partners, being a long-term private sector landlord within the social housing regulatory environment. As a Registered Provider, ReSI Housing can acquire affordable housing subject to s106 planning restrictions and housing funded by government grant.

Acquisitions by ReSI are limited to homes with sufficient cashflows, counterparty credit quality and property security to be capable of supporting long ‑ term investment grade equivalent debt. ReSI does not manage or operate stock and uses experienced and credit-worthy managers.

ReSI is managed by ReSI Capital Management Limited, whose immediate parent company, TradeRisks Limited, has been active within the social housing sector for over 20 years as a funding arranger and advisor and, over the last four years, as an investor through ReSI.

ReSI Capital Management and its parent, TradeRisks, were acquired by Gresham House in March 2020, further increasing the investment expertise available to ReSI. The housing investment team at Gresham House has 21 members with an average of 17 years relevant experience, covering fund management, housing investment, social housing management and financial and risk expertise.

Gresham House plc is a London Stock Exchange quoted specialist alternative asset manager committed to operating responsibly and sustainably, taking the long view in delivering sustainable investment solutions.

Further information on ReSI is available at  www.resi-reit.com , and further information on Gresham House is available at   www.greshamhouse.com . However, please note neither the content of ReSI's website or Gresham House's (or any other website) nor the content of any website accessible from hyperlinks on ReSI's website, Gresham House's website (or any other website) is incorporated into, or forms part of, this Announcement.

[1] The dividend target and total return target are targets only and are not profit forecasts. There can be no assurance that either target will be met and they should not be taken as an indication of the Company's future results.

²   Excluding the finance lease gross up and including £7m of committed acquisitions.

The Company's LEI is: 213800D24WA531LAR763

IMPORTANT NOTICES

THE CONTENTS OF THIS ANNOUNCEMENT, WHICH HAVE BEEN PREPARED BY AND ARE THE SOLE RESPONSIBILITY OF RESIDENTIAL SECURE INCOME PLC, HAVE BEEN APPROVED BY RESI CAPITAL MANAGEMENT LIMITED (THE "FUND MANAGER") SOLELY FOR THE PURPOSES OF SECTION 21(2)(B) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (AS AMENDED).

This announcement, including the Appendix, and the information contained herein is not for release, publication or distribution, directly or indirectly, in whole or in part, in or into or from the United States (including its territories and possessions, any state of the United States and the District of Columbia (the "United States" or "US")), Australia, Canada, New Zealand, Japan, the Republic of South Africa, any Member State or any other jurisdiction where to do so might constitute a violation of the relevant laws or regulations of such jurisdiction.

The Placing Shares have not been and will not be registered under the US Securities Act of 1933, as amended (the "US Securities Act") or under the applicable state securities laws of the United States and may not be offered or sold directly or indirectly in or into the United States or to or for the account or benefit of any US person (within the meaning of Regulation S under the US Securities Act) (a "US Person"). No public offering of the Placing Shares is being made in the United States. The Placing Shares are being offered and sold outside the United States in "offshore transactions", as defined in, and in compliance with, Regulation S under the US Securities Act.

This announcement, including the Appendix, does not constitute an offer to sell or issue or a solicitation of an offer to buy or subscribe for Placing Shares in any jurisdiction including, without limitation, the United States, Australia, Canada, New Zealand, Japan, the Republic of South Africa, any Member State or any other jurisdiction in which such offer or solicitation is or may be unlawful (a "Restricted Jurisdiction"). This announcement and the information contained herein are not for publication or distribution, directly or indirectly, to persons in a Restricted Jurisdiction unless permitted pursuant to an exemption under the relevant local law or regulation in any such jurisdiction. No action has been taken by the Company, Jefferies or any of their respective affiliates that would permit an offer of the Placing Shares or possession or distribution of this announcement or any other publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required. Persons receiving this announcement are required to inform themselves about and to observe any such restrictions.

The Placing Shares have not been approved or disapproved by the US Securities and Exchange Commission, any state securities commission or other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Placing or the accuracy or adequacy of this announcement. Any representation to the contrary is a criminal offence in the United States. Persons receiving this announcement (including custodians, nominees and trustees) must not forward, distribute, mail or otherwise transmit it in or into the United States or use the United States mails, directly or indirectly, in connection with the Placing. No money, securities or other consideration from any person inside the United States is being solicited and, if sent in response to the information contained in this announcement, will not be accepted.

Members of the public are not eligible to take part in the Placing. This announcement and the terms and conditions set out and referred to herein are directed only at persons selected by Jefferies who are (a) if in the United Kingdom, persons who (i) are "qualified investors", as defined in the UK version of Regulation (EU) 2017/1129 as amended from time to time which is part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended (the "UK Prospectus Regulation") (ii) have professional experience in matters relating to investments who fall within the definition of "investment professionals" in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 as amended (the "FPO") or fall within the definition of "high net worth companies, unincorporated associations etc" in Article 49(2)(a) to (d) of the FPO; and (iii) are a "professional client" or an "eligible counterparty" within the meaning of Chapter 3 of the UK Financial Conduct Authority's (the "FCA") Conduct of Business Sourcebook; or (b) otherwise persons to whom it may otherwise lawfully be communicated (all such persons together being referred to as "Relevant Persons"). By accepting the terms of this announcement, you represent and agree that you are a Relevant Person. This announcement may not be distributed in any Restricted Jurisdiction.

This announcement must not be acted on or relied on by persons who are not Relevant Persons. Any investment or investment activity to which this announcement or the Placing relates is available only to Relevant Persons and will be engaged in only with Relevant Persons. As regards all persons other than Relevant Persons, the details of the Placing set out in this announcement are for information purposes only.

Persons (including, without limitation, nominees and trustees) who have a contractual or other legal obligation to forward a copy of this announcement should seek appropriate advice before taking any action.

This announcement is a financial promotion and is not intended to be investment advice. The content of this announcement, which has been prepared by and is the sole responsibility of the Company, has been approved by ReSI Capital Management Limited (the "FundManager"), which is authorised and regulated by the FCA, solely for the purposes of section 21(2)(b) of the Financial Services and Markets Act 2000 (as amended).

No representation or warranty, express or implied, is or will be made by the Company, Jefferies, or by any of their respective directors, officers, employees, advisers, consultants or affiliates as to or in relation to, the accuracy or completeness of this announcement or any other written or oral information made available to any interested person or its advisers, and any liability therefore is expressly disclaimed. None of the information in this announcement has been independently verified or approved by Jefferies or any of its directors, officers, employees, advisers, consultants or affiliates. Save for any responsibilities or liabilities, if any, imposed on Jefferies by FSMA or by the regulatory regime established under it, no responsibility or liability is accepted by Jefferies or any of its directors, officers, employees, advisers, consultants or affiliates for any errors, omissions or inaccuracies in such information or opinions or for any loss, cost or damage suffered or incurred howsoever arising, directly or indirectly, from any use of this announcement or its contents or otherwise in connection with this announcement or from any acts or omissions of the Company in relation to the Placing. 

Certain statements in this announcement are forward-looking statements which are based on the Company's expectations, intentions and projections regarding its future performance, anticipated events or trends and other matters that are not historical facts. These forward-looking statements, which may use words such as "aim", "anticipate", "believe", "intend", "estimate", "expect" and words of similar meaning, include all matters that are not historical facts. These forward-looking statements involve risks, assumptions and uncertainties that could cause the actual results of operations, financial condition, liquidity and dividend policy and the development of the industries in which the Company's businesses operate to differ materially from the impression created by the forward-looking statements. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Given those risks and uncertainties, prospective investors are cautioned not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date of such statements and, except as required by the FCA, the London Stock Exchange or applicable law, the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Any indication in this announcement of the price at which the ordinary shares of the Company have been bought or sold in the past cannot be relied upon as a guide to future performance. Persons needing advice should consult an independent financial adviser. No statement in this announcement is intended to be a profit forecast and no statement in this announcement should be interpreted to mean that earnings or target dividend per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings or dividends per share of the Company.

The Placing Shares to be issued pursuant to the Placing will not be admitted to trading on any stock exchange other than the London Stock Exchange.

Jefferies, which is authorised and regulated in the United Kingdom by the FCA, is acting as the sole bookrunner to the Company in respect of the Placing. Jefferies is acting exclusively for the Company and for no-one else in connection with the Placing and the matters referred to herein, and will not be treating any other person as its client, in relation thereto and will not be responsible for providing the regulatory protections afforded to its customers nor for providing advice in connection with the Placing or any other matters referred to herein. Jefferies is not making any representation or warranty, express or implied, as to the contents of this announcement. Jefferies has not authorised the contents of, or any part of, this announcement, and no liability whatsoever is accepted by Jefferies for the accuracy of any information or opinions contained in this announcement or for the omission of any information. 

The Appendix to this announcement (which forms part of this announcement) sets out the terms and conditions of the Placing. By participating in the Placing, each person who is invited to and who chooses to participate in the Placing by making or accepting an oral and legally binding offer to acquire Placing Shares will be deemed to have read and understood this announcement in its entirety (including the Appendix) and to be making such offer on the terms and subject to the conditions set out in this announcement and to be providing the representations, warranties, undertakings, indemnities acknowledgements and agreements contained in the Appendix.

None of Jefferies, the Fund Manager, or any of their respective directors, officers, employees, advisers, affiliates or agents, accepts any responsibility or liability whatsoever for or makes any representation or warranty, express or implied, as to this announcement, including the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or for any loss howsoever arising from any use of the announcement or its contents. Jefferies and the Fund Manager, and their respective directors, officers, employees, advisers, affiliates or agents, accordingly disclaim all and any liability whether arising in tort, contract or otherwise which they might otherwise have in respect of this announcement or its contents or otherwise arising in connection therewith.

Neither the content of the Company's website (or any other website) nor the content of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.

DATA PROTECTION

The processing of a Placee's personal data by the Company will be carried out in compliance with the applicable data protection legislation and with its Privacy Notice, a copy of which can be found on the Company's website www.greshamhouse.com/real-assets/housing/residential-secure-income-plc/

Each Placee acknowledges that it has read and understood the processing activities carried out by the Company as informed in the referred Privacy Notice.

DEFINITIONS USED IN THIS ANNOUNCEMENT

"Admission"	admission of the New Ordinary Shares to the Official List becoming effective in accordance with the Listing Rules and the admission of such shares to trading on the London Stock Exchange's main market for listed securities becoming effective in accordance with the Admission and Disclosure Standards;
"Admission and Disclosure Standards"	the "Admission and Disclosure Standards" of the London Stock Exchange containing, among other things, the admission requirements to be observed by companies seeking admission to trading on the London Stock Exchange's main market for listed securities;
"Board" or "Directors"	the directors of the Company;
"Business Day"	any day which is not a Saturday or Sunday or a bank holiday in the City of London;
"certificated" or "in certificated form"	where a security is not held in uncertificated form (i.e. not in CREST);
"Company" or "ReSI"	Residential Secure Income plc;
"CREST Regulations"	the Uncertificated Securities Regulations 2001 (SI 2001/3755);
"CREST"	the relevant system (as defined in the CREST Regulations) in respect of which Euroclear is the Operator (as defined in the CREST Regulations);
"ERISA"	the US Employee Retirement Income Security Act of 1974, as amended;
"Euroclear"	Euroclear UK & International Limited, the operator of CREST;
"EUWA"	the European Union (Withdrawal) Act 2018, as amended;
"FATCA"	the US Foreign Account Tax Compliance Act of 2010;
"FCA"	the Financial Conduct Authority of the United Kingdom;
"FSMA"	the Financial Services and Markets Act 2000;
"Fund Manager"	ReSI Capital Management Limited;
"Group"	the Company and its subsidiary undertakings from time to time;
"Jefferies"	Jefferies International Limited, acting as the Company's sole bookrunner in relation to the Placing;
"Listing Rules"	the Listing Rules made by the FCA under Part VI of FSMA;
"London Stock Exchange"	London Stock Exchange plc;
"Member State"	any member state  of the European Economic Area;
"New Ordinary Shares"	the new Ordinary Shares to be issued pursuant to the Placing or the Retail Offer;
"Official List"	the Official List of the FCA pursuant to Part VI of FSMA;
"Ordinary Shares"	the ordinary shares of £0.01 each in the capital of the Company, having such rights and being subject to such restrictions as are contained in the Company's articles of association;
"Placee"	means a Relevant Person (including individuals, funds or otherwise) by whom or on whose behalf a commitment to subscribe for Placing Shares has been given;
"Placing Agreement"	the placing agreement dated on or around the date of this announcement between the Company, the Fund Manager and Jefferies;
"Placing Shares"	up to 18,433,179 New Ordinary Shares to be issued pursuant to the Placing;
"PrimaryBid"	PrimaryBid Limited with registered number 08092575 and having its registered office at 21 Albermarle Street, London W1S 4BS;
"Registrar"	Computershare Investor Services PLC;
"uncertificated" or "in uncertificated form"	recorded on the register of members of the Company as being held in uncertificated form pursuant to the CREST Regulations;
"United Kingdom" or "UK"	the United Kingdom of Great Britain and Northern Ireland;
"USCode"	the US Internal Revenue Code of 1986, as amended; and
"US Investment Company Act"	the US Investment Company Act of 1940, as amended.

APPENDIX: TERMS AND CONDITIONS OF THE PLACING

THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX, AND THE INFORMATION IN IT, IS RESTRICTED, AND EXCEPT AS SET OUT BELOW IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO A RESTRICTED JURISDICTION.

IMPORTANT INFORMATION FOR PLACEES ONLY

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT AND REFERRED TO HEREIN ARE DIRECTED ONLY AT PERSONS SELECTED BY JEFFERIES WHO ARE (A) IF IN THE UNITED KINGDOM, PERSONS WHO (I) ARE QUALIFIED INVESTORS, AS DEFINED IN THE UK PROSPECTUS REGULATION (II) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS WHO FALL WITHIN THE DEFINITION OF "INVESTMENT PROFESSIONALS" IN ARTICLE 19(5) OF THE FPO OR FALL WITHIN THE DEFINITION OF "HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS ETC" IN ARTICLE 49(2)(A) TO (D) OF THE FPO; AND (III) ARE A "PROFESSIONAL CLIENT" OR AN "ELIGIBLE COUNTERPARTY" WITHIN THE MEANING OF CHAPTER 3 OF THE FCA'S CONDUCT OF BUSINESS SOURCEBOOK; OR (B) OTHERWISE PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS.

THE ATTENTION OF ALL PROSPECTIVE INVESTORS IS DRAWN TO DISCLOSURES REQUIRED TO BE MADE UNDER THE ALTERNATIVE INVESTMENT FUND MANAGERS REGULATIONS 2013 (AS AMENDED BY THE ALTERNATIVE INVESTMENT FUND MANAGERS (AMENDMENT ETC.) (EU EXIT) REGULATIONS 2019) AND THE INVESTMENT FUNDS SOURCEBOOK ("FUND") FORMING PART OF THE FCA HANDBOOK (THE "UK AIFM REGIME") WHICH ARE SET OUT ON THE COMPANY'S WEBSITE (INCLUDING AS SET OUT IN ITS MOST RECENT ANNUAL REPORT AND ACCOUNTS), WHICH WILL ALSO SET OUT (IF APPLICABLE) ANY PERIODIC UPDATES REQUIRED UNDER THE RULES IN FUND.

THE FUND MANAGER IS AUTHORISED FOR THE MANAGEMENT OF THE COMPANY AND MARKETING OF THE NEW ORDINARY SHARES IN THE UNITED KINGDOM AND IS SUPERVISED BY THE FCA.

DISTRIBUTION OF THIS ANNOUNCEMENT IN CERTAIN JURISDICTIONS MAY BE RESTRICTED OR PROHIBITED BY LAW. PERSONS DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO.

The Placing Shares have not been and will not be registered under the US Securities Act or under the applicable state securities laws of the United States and may not be offered or sold directly or indirectly in or into the United States or to or for the account or benefit of any US Person. No public offering of the Placing Shares is being made in the United States. The Placing Shares are being offered and sold outside the United States in "offshore transactions", as defined in, and in compliance with, Regulation S under the US Securities Act. In addition, the Company has not been, and will not be, registered under the US Investment Company Act.

The Placing Shares have not been approved or disapproved by the US Securities and Exchange Commission, any state securities commission or other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Placing or the accuracy or adequacy of this announcement. Any representation to the contrary is a criminal offence in the United States. Persons receiving this announcement (including custodians, nominees and trustees) must not forward, distribute, mail or otherwise transmit it in or into the United States or use the United States mails, directly or indirectly, in connection with the Placing. No money, securities or other consideration from any person inside the United States is being solicited and, if sent in response to the information contained in this announcement, will not be accepted.

This announcement does not constitute or form part of an offer to sell or issue or a solicitation of an offer to buy or subscribe for or otherwise acquire any securities in any jurisdiction including, without limitation, the Restricted Jurisdictions. This announcement and the information contained in it is not for publication or distribution, directly or indirectly, to persons in a Restricted Jurisdiction unless permitted pursuant to an exemption under the relevant local law or regulation in any such jurisdiction.

No action has been taken by the Company, the Fund Manager, Jefferies or any of their respective affiliates that would permit an offer of the Placing Shares or possession or distribution of this announcement or any other publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required. Persons receiving this announcement are required to inform themselves about and to observe any such restrictions.

Persons (including, without limitation, nominees and trustees) who have a contractual or other legal obligation to forward a copy of this announcement should seek appropriate advice before taking any action.

Any indication in this announcement of the price at which the ordinary shares of the Company have been bought or sold in the past cannot be relied upon as a guide to future performance. Persons needing advice should consult an independent financial adviser. No statement in this announcement is intended to be a profit forecast and no statement in this announcement should be interpreted to mean that earnings or target dividend per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings or dividends per share of the Company.

Information to distributors

Solely for the purposes of the product governance requirements contained within the product governance requirements contained within Chapter 3 of the FCA Handbook Product Intervention and Product Governance Sourcebook (the "UK Product Governance Requirements") and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the UK Product Governance Requirements) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that the Placing Shares are: (i) compatible with an end target market of (a) retail investors, (b) investors who meet the criteria of professional clients as defined in EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II") and Regulation (EU) NO 600/2014 as it forms part of United Kingdom domestic law by virtue of the EUWA and (c) eligible counterparties, each as defined in the FCA's Conduct of Business Sourcebook ("COBS"); and (ii) eligible for distribution through all distribution channels as are permitted by t he UK Product Governance Requirements (the "Target Market Assessment").

Notwithstanding the Target Market Assessment, distributors should note that: the price of the Placing Shares may decline and investors could lose all or part of their investment; the Placing Shares offer no guaranteed income and no capital protection; and an investment in the Placing Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Placing. Furthermore, it is noted that, notwithstanding the Target Market Assessment, Jefferies will only procure investors who meet the criteria of professional clients and eligible counterparties.

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of COBS; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares.

Each distributor is responsible for undertaking its own target market assessment in respect of the Placing Shares and determining appropriate distribution channels.

Jefferies, which is authorised and regulated in the United Kingdom by the FCA, is acting for the Company and for no one else in connection with the Placing and will not be responsible to anyone other than the Company for providing the protections afforded to its clients or for affording advice in relation to the Placing, or any other matters referred to herein. 

By participating in the Placing, each Placee by making or accepting an oral or written offer to take up Placing Shares is deemed to have read and understood this announcement in its entirety (including this Appendix) and to be providing the representations, warranties, undertakings, agreements and acknowledgements contained herein.

EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL, REGULATORY, TAX, BUSINESS AND RELATED ASPECTS OF A PURCHASE OF PLACING SHARES.

Participation in, and principal terms of, the bookbuilding process

Participation in the Placing will only be available to persons who may lawfully be, and are, invited to participate by Jefferies. Jefferies and its respective affiliates are entitled to participate as Placees in the bookbuilding process.

The books will open at 8.00 a.m. (London time) on 2 February 2022 and are expected to close at 5.00 p.m. (London time) on the same day but may be closed earlier (or later) at the absolute discretion of the Company, in consultation with Jefferies, who is acting as sole bookrunner in connection with the Placing. A further announcement will be made following the close of the bookbuilding process detailing the total number of Placing Shares which are being placed. Jefferies may, in agreement with the Company, accept bids that are received after the bookbuilding process has closed.

A bid in the bookbuilding process will be made on the terms and conditions in this announcement and will be legally binding on the Placee on behalf of which it is made and, except with Jefferies' consent, will not be capable of variation or revocation after the close of the bookbuilding process.

A Placee who wishes to participate in the bookbuilding process should communicate its bid by telephone or in writing to the usual sales contact at Jefferies. Each bid should state the number of Placing Shares which the prospective Placee wishes to subscribe for at the Placing Price. If successful, Jefferies will re-contact and confirm orally or in writing to Placees following the close of the bookbuilding process the size of their respective allocations and a trade confirmation will be dispatched as soon as possible thereafter. Jefferies' oral or written confirmation of the size of allocations will constitute an irrevocable legally binding agreement in favour of the Company and Jefferies pursuant to which each such Placee will be required to accept the number of Placing Shares allocated to the Placee at the Placing Price and otherwise on the terms and subject to the conditions set out herein and in accordance with the Company's articles of association. Each Placee's allocation and commitment will be evidenced by a trade confirmation issued to such Placee by Jefferies. The terms of this Appendix will be deemed incorporated in that trade confirmation. Each such Placee will have an immediate, separate, irrevocable and binding obligation, owed to Jefferies, to pay it or (as it may direct) one of its affiliates in cleared funds an amount equal to the product of the Placing Price and the number of Placing Shares allocated to such Placee. 

The Company reserves the right to scale back the number of Placing Shares to be subscribed by any Placee in the event of an oversubscription under the Placing after consultation with Jefferies. Jefferies also reserves the right not to accept offers to subscribe for Placing Shares or to accept such offers in part rather than in whole. The acceptance of offers shall be at the absolute discretion of Jefferies. Jefferies shall be entitled to effect the Placing by such alternative method to the bookbuilding process as it shall in its absolute discretion determine. The Company reserves the right (upon consultation with Jefferies) to reduce the amount to be raised pursuant to the Placing. 

To the fullest extent permissible by law, neither Jefferies nor any of its affiliates nor any person acting on its behalf shall have any liability to Placees (or to any other person whether acting on behalf of a Placee or otherwise). In particular, neither Jefferies, nor any of its affiliates nor any person acting on its behalf shall have any liability (including, to the extent legally permissible, any fiduciary duties), in respect of its conduct of the bookbuilding process or of such alternative method of effecting the Placing as Jefferies and the Company may determine. No commissions will be paid to Placees or by Placees in respect of any Placing Shares. 

Each Placee's obligations will be owed to the Company and to Jefferies. Following the oral or written confirmation referred to above, each Placee will also have an immediate, separate, irrevocable and binding obligation, owed to the Company and Jefferies as agent of the Company, to pay to Jefferies (or as it may direct) in cleared funds an amount equal to the product of the Placing Price and the number of Placing Shares such Placee has agreed to acquire. Jefferies will procure the allotment of the Placing Shares to each Placee following each Placee's payment to Jefferies of such amount. 

All obligations of Jefferies under the Placing will be subject to fulfilment of the conditions referred to below under "Conditions of the Placing". 

Conditions of the Placing

The Placing is conditional upon the Placing Agreement becoming unconditional and not having been terminated in accordance with its terms.

The obligations of Jefferies under the Placing Agreement are conditional, inter alia, on Admission occurring not later than 8.00 a.m. on 7 February 2022 or such later time and/or date as may be agreed between the Company and Jefferies, not being later than 8.00 a.m. on 28 February 2022. 

If (a) the conditions are not fulfilled (or to the extent permitted under the Placing Agreement waived by Jefferies), or (b) the Placing Agreement is terminated in the circumstances specified below, the Placing will lapse and each Placee's rights and obligations hereunder shall cease and determine at such time and no claim may be made by a Placee in respect thereof. Neither Jefferies, nor the Company, nor any of their respective affiliates shall have any liability to any Placee (or to any other person whether acting on behalf of a Placee or otherwise) in respect of any decision it may make as to whether or not to waive or to extend the time and/or date for the satisfaction of any condition in the Placing Agreement or in respect of the Placing generally. 

By participating in the Placing, each Placee agrees that its rights and obligations hereunder terminate only in the circumstances described below under "Right to terminate under the Placing Agreement", and will not be capable of rescission or termination by the Placee.

Right to terminate under the Placing Agreement

Jefferies may, at any time before Admission, terminate the Placing Agreement by giving notice to the Company and the Fund Manager if, inter alia:

1.  there has been a breach by the Company or the Fund Manager of any of their respective obligations under the Placing Agreement;

2.  there has been any adverse change in, or any development involving or reasonably likely to involve a prospective adverse change in or affecting, the condition (financial, operational, legal or otherwise), earnings, business, management, prospects, assets, rights, net asset value, funding position, liquidity or solvency of of the Company or the Group (whether or not foreseeable at the date of the Placing Agreement); or

3.  there has been a material change in national or international financial, political, economic or stock market conditions (primary or secondary); an incident of terrorism, outbreak or escalation of hostilities, war, declaration of martial law or any other calamity or crisis; a suspension or material limitation in trading of securities generally on any stock exchange; any change in currency exchange rates or exchange controls or a disruption of settlement systems or a material disruption in commercial banking.

By participating in the Placing, each Placee agrees with Jefferies that the exercise by Jefferies of any right of termination or other discretion under the Placing Agreement shall be within the absolute discretion of Jefferies and Jefferies need not make any reference to the Placees in this regard and that, to the fullest extent permitted by law, Jefferies shall have no liability whatsoever to the Placees in connection with any such exercise. 

No Prospectus

The prospectus dated 22 June 2017 may not be relied upon in relation to this Placing.  No offering document or prospectus has been or will be prepared in relation to the Placing and no such prospectus is required (in accordance with the EU Prospectus Regulation or the UK Prospectus Regulation) to be published and Placees' commitments will be made solely on the basis of the information contained in this announcement and information that has been published by or on behalf of the Company by notification to a Regulatory Information Service (as defined in the Listing Rules) in accordance with the FCA's Disclosure Guidance and Transparency Rules, the Market Abuse Regulation (EU Regulation No. 596/2014) ("MAR") and MAR as it forms part of United Kingdom law by virtue of the EUWA ("UK MAR") (collectively "Exchange Information"). Each Placee, by accepting a participation in the Placing, agrees that the content of this announcement is exclusively the responsibility of the Company and confirms to Jefferies and the Company that it has neither received nor relied on any information (other than the Exchange Information), representation, warranty or statement made by or on behalf of Jefferies (other than the amount of the relevant Placing participation in the oral or written confirmation given to Placees and the trade confirmation referred to below), any of its affiliates, any persons acting on its behalf or the Company and neither Jefferies nor any of its affiliates, any persons acting on its behalf, nor the Company will be liable for the decision of any Placee to participate in the Placing based on any other information, representation, warranty or statement which the Placee may have obtained or received (regardless of whether or not such information, representation, warranty or statement was given or made by or on behalf of any such persons). By participating in the Placing, each Placee acknowledges to and agrees with Jefferies for itself and as agent for the Company that, except in relation to the information contained in this announcement, it has relied on its own investigation of the business, financial or other position of the Company in deciding to participate in the Placing. Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation. 

Registration and settlement

Settlement of transactions in the Placing Shares (ISIN: GB00BYSX1508) following Admission will take place within the CREST system, using the DVP mechanism, subject to certain exceptions. Jefferies reserves the right to require settlement for and delivery of the Placing Shares to Placees by such other means that it deems necessary, if delivery or settlement is not possible or practicable within the CREST system within the timetable set out in this announcement or would not be consistent with the regulatory requirements in the Placee's jurisdiction. 

Each Placee allocated Placing Shares in the Placing will be sent a trade confirmation stating the number of Placing Shares allocated to it, the Placing Price, the aggregate amount owed by such Placee to Jefferies and settlement instructions. Placees should settle against CREST ID: 393. It is expected that such trade confirmation will be despatched on 3 February 2022 and that this will also be the trade date. Each Placee agrees that it will do all things necessary to ensure that delivery and payment is completed in accordance with either the standing CREST or certificated settlement instructions which it has in place with Jefferies. 

It is expected that settlement will be on 7 February 2022 on a DVP basis in accordance with the instructions set out in the trade confirmation unless otherwise notified by Jefferies.

Interest is chargeable daily on payments not received from Placees on the due date in accordance with the arrangements set out above at the rate of two percentage points above SONIA as determined by Jefferies.

Each Placee is deemed to agree that if it does not comply with these obligations, Jefferies may sell any or all of the Placing Shares allocated to the Placee on such Placee's behalf and retain from the proceeds, for Jefferies' own account and profit, an amount equal to the aggregate amount owed by the Placee plus any interest due. The Placee will, however, remain liable for any shortfall below the aggregate amount owed by such Placee and it may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon the sale of such Placing Shares on such Placee's behalf and any amount required to cover dealing costs and/or commissions necessarily or reasonably incurred by Jefferies in respect of such sale. Such Placee shall remain liable and shall indemnify Jefferies (as agent for the Company) on demand for the full amount of any losses and of any costs which it may suffer or incur as a result of Jefferies (a) not receiving payment in full for such Placing Shares by the required time, and/or (b) the sale of any such Placing Shares to any other person at whatever price and on whatever terms actually obtained for such sale by or for Jefferies. By communicating a bid for Placing Shares, each Placee confers on Jefferies all such authorities and powers necessary to carry out any such sale and agrees to ratify and confirm all actions which Jefferies lawfully takes in pursuance of such sale. 

If Placing Shares are to be delivered to a custodian or settlement agent, the Placee should ensure that the trade confirmation is copied and delivered immediately to the relevant person within that organisation.

Insofar as Placing Shares are registered in the Placee's name or that of its nominee or in the name of any person for whom the Placee is contracting as agent or that of a nominee for such person, such Placing Shares will, subject as provided below, be so registered free from any liability to stamp duty or stamp duty reserve tax. If there are any circumstances in which any other stamp duty or stamp duty reserve tax is payable in respect of the issue of the Placing Shares, neither Jefferies nor the Company shall be responsible for the payment thereof. Placees will not be entitled to receive any fee or commission in connection with the Placing. Jefferies, is entitled, at its discretion and out of its own resources, to rebate or pay away to some or all investors, or to other parties, part or all of its commission relating to the Placing. 

Representations and Warranties

By participating in the Placing, each Placee (and any person acting on such Placee's behalf):

1.  represents, warrants and acknowledges that it has read and understood this announcement (including the Appendix) in its entirety and that its participation in the bookbuilding process and the Placing and its subscription for Placing Shares is subject to and based upon all the terms, conditions, representations, warranties, indemnities, acknowledgements, agreements and undertakings contained herein and not in reliance on any representations, warranties or statements made at any time by any person in connection with Admission, the Company, the Placing or otherwise);

2.  acknowledges that the prospectus dated 22 June 2017 may not be relied upon in relation to this Placing; no prospectus or offering document has been or will be prepared in connection with the Placing; and it has not received and will not receive a prospectus or other offering document in connection with the bookbuilding process, the Placing or the Placing Shares;

3.  agrees to indemnify on an after-tax basis and hold harmless each of the Company, Jefferies, their respective affiliates and any person acting on their behalf from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach of the representations, warranties, acknowledgements, agreements and undertakings in this announcement and further agrees that the provisions of this announcement shall survive after completion of the Placing;

4.  acknowledges that the Ordinary Shares are admitted to the premium listing segment of the Official List of the FCA and admitted to trading on the premium segment of the main market of the London Stock Exchange, and the Company is therefore required to publish Exchange Information and that the Placee is able to obtain or access the Exchange Information without undue difficulty;

5.  represents, warrants and agrees that if the laws of any territory or jurisdiction outside the United Kingdom are applicable to its agreement to subscribe for the Placing Shares that it has complied with all such laws, obtained all governmental and other consents which may be required, complied with all requisite formalities and paid any issue, transfer or other taxes due in connection with its application in any such territory or jurisdiction and that it has not taken any action or omitted to take any action which will or might reasonably be expected to result in the Company, the Fund Manager, the Registrar or Jefferies, or any of their respective officers, agents, employees or affiliates acting in breach of the regulatory or legal requirements, directly or indirectly, of any territory or jurisdiction outside the United Kingdom in connection with the Placing; 

6.  represents, warrants and agrees that (a) the only information on which it is entitled to rely and the only information on which it has relied in making an offer to subscribe for the Placing Shares is contained in this announcement (including this Appendix) and the Exchange Information published prior to the date of this announcement, and such information is all that it deems necessary to make an investment decision in respect of the Placing Shares; and (b) it has neither received nor relied on any other information given or representations, warranties or statements made by Jefferies, the Company or the Fund Manager or any of their respective directors, officers or employees or any person acting on behalf of any of them (including with respect to the Company, the Placing, the Placing Shares or the accuracy, completeness or adequacy of any publicly available information), or, if received, it has not relied upon any such information, representations, warranties or statements, and neither Jefferies nor the Company nor the Fund Manager will be liable for any prospective Placee's decision to make an offer to subscribe for the Placing Shares based on any other information, representation, warranty or statement. Each Placee further acknowledges and agrees that it may not place the same degree of reliance on this announcement as it may otherwise place on a prospectus or admission document. Each Placee further acknowledges and agrees that it has relied solely on its own investigation of the business, financial or other position of the Company and the terms of the Placing and has independently made its own analysis and decision with regard to its commitment to subscribe for Placing Shares and it will not rely on any investigation that Jefferies, its affiliates or any other person acting on its behalf has or may have conducted;

7.  acknowledges that the content of this announcement and the Exchange Information is exclusively the responsibility of the Company and that neither Jefferies, nor any of its affiliates nor any person acting on its behalf will be responsible for or shall have any liability for any information, representation or statement relating to the Company contained in this announcement or any information previously published by or on behalf of the Company and neither Jefferies, nor any of its affiliates nor any person acting on its behalf will be liable for any Placee's decision to participate in the Placing based on any information, representation or statement contained in this announcement or otherwise;

8.  acknowledges that it has knowledge and experience in financial, business and international investment matters as is required to evaluate the merits and risks of subscribing for the Placing Shares. It further acknowledges that it is experienced in investing in securities of this nature and is aware that it may be required to bear, and is able to bear, the economic risk of, and is able to sustain, a complete loss in connection with the Placing. It has had sufficient time to consider and conduct its own investigation with respect to the offer and subscription for the Placing Shares, including the tax, legal and other economic considerations and has relied upon its own examination and due diligence of the Company and its affiliates taken as a whole, and the terms of the Placing, including the merits and risks involved;

9.  represents and warrants that if it has received any inside information (for the purposes of MAR, UK MAR and section 56 of the Criminal Justice Act 1993 or other applicable law) about the Company in advance of the Placing, it has not (a) dealt (or attempted to deal) in the securities of the Company; (b) encouraged, recommended or induced another person to deal in the securities of the Company; or (c) unlawfully disclosed such information to any person, prior to the information being made publicly available;

10.  acknowledges that it has not relied on any information relating to the Company contained in any research reports prepared by Jefferies, its affiliates or any person acting on its behalf and understands that (i) Jefferies, nor any of its affiliates nor any person acting on its behalf has or shall have any liability for public information or any representation; (ii) Jefferies, nor any of its respective affiliates nor any person acting on its behalf has or shall have any liability for any additional information that has otherwise been made available to such Placee, whether at the date of this announcement, the date of Admission or otherwise; and that (iii) Jefferies, nor any of its affiliates nor any person acting on its behalf makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of such information, whether at the date of this announcement, the date of Admission or otherwise;

11.  represents and warrants that it and each account it represents is not, and at the time the Placing Shares are subscribed for, neither it nor the beneficial owner of the Placing Shares will be, a citizen, resident or national of the United States, Australia, Canada, New Zealand, Japan, or any jurisdiction in which it would be unlawful to make or accept an offer of the Placing Shares and acknowledges that the Placing Shares have not been and will not be registered under the securities legislation of the United States, Australia, Canada, New Zealand, Japan, the Republic of South Africa or any  Member State and, subject to certain exceptions, may not be offered, sold, transferred, taken up, renounced, distributed or delivered, directly or indirectly, within or into those jurisdictions;

12.  represents and warrants that it will not distribute, forward, transfer or otherwise transmit this announcement or any other materials concerning the Placing (including any electronic copies thereof), in or into the United States, Australia, Canada, New Zealand, Japan, the Republic of South Africa or any Member State;

13.  represents and warrants that (i) it is entitled to acquire the Placing Shares under the laws and regulations of all relevant jurisdictions which apply to it; (ii) it has fully observed such laws and regulations and obtained all such governmental and other guarantees and other consents and authorities which may be required thereunder and complied with all necessary formalities; (iii) it has all necessary capacity to commit to participation in the Placing and to perform its obligations in relation thereto and will honour such obligations; (iv) it has paid any issue, transfer or other taxes due in connection with its participation in any territory; and (v) it has not taken any action which will or may result in the Company, Jefferies, any of its affiliates or any person acting on its behalf being in breach of the legal and/or regulatory requirements of any territory in connection with the Placing;

14.  represents and warrants that it understands that the Placing Shares have not been and will not be registered under the US Securities Act or under the securities laws of any state or other jurisdiction of the United States and may only be acquired in "offshore transactions" as defined in and pursuant to Regulation S under the US Securities Act;

15.  represents and warrants that it understands that the Company has not been, and will not be, registered under the US Investment Company Act;

16.  represents and warrants that it is: (i) at the time of its application and at the time of settlement located outside the United States and is subscribing for the Placing Shares only in "offshore transactions" as defined in and pursuant to Regulation S, and (ii) it is not subscribing for Placing Shares as a result of any "directed selling efforts" as defined in Regulation S or by means of any form of "general solicitation" or "general advertising" as such terms are defined in Regulation D under the US Securities Act;

17.  represents and warrants that, (a) (i) it is not located in the United States; (ii) it is not a US Person and (iii) it is not acting for the account or benefit of a US Person or (b) it is a dealer or other professional fiduciary in the United States acting for a discretionary account (other than an estate or trust) held for the benefit or account of a non US Person in reliance on Regulation S;

18.  represents and warrants that it is not and was not acting on a non-discretionary basis for the account or benefit of a person located within the United States at the time the undertaking to subscribe for Placing Shares was given and it is not acquiring Placing Shares with a view to the offer, sale, resale, transfer, delivery or distribution, directly or indirectly, of any Placing Shares into the United States and it will not reoffer, resell, pledge or otherwise transfer the Placing Shares in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act and otherwise in accordance with any applicable securities laws of any state or jurisdiction of the United States;

19.  represents and warrants that no portion of the assets used to purchase, and no portion of the assets used to hold, the Placing Shares or any beneficial interest therein constitutes or will constitute the assets of (i) an "employee benefit plan" as defined in Section 3(3) of ERISA that is subject to Title I of ERISA; (ii) a "plan" as defined in Section 4975 of the US Code, including an individual retirement account or other arrangement that is subject to Section 4975 of the US Code; or (iii) an entity which is deemed to hold the assets of any of the foregoing types of plans, accounts or arrangements that is subject to Title I of ERISA or Section 4975 of the US Code. In addition, if the Placee is a governmental, church, non-US or other plan that is subject to any federal, state, local or non-US law or regulation that is substantially similar to the provisions of Title I of ERISA or Section 4975 of the US Code, its purchase, holding, and disposition of the Placing Shares will not constitute or result in a non-exempt violation of any such substantially similar law or regulation;

20.  acknowledges that the Company reserves the right to make inquiries of any holder of the Placing Shares or interests therein at any time as to such person's status under US federal securities laws and to require any such person that has not satisfied the Company that holding by such person will not violate or require registration under US securities laws to transfer such Placing Shares or interests in accordance with the articles of association of the Company;

21.  acknowledges that the Company is required to comply with FATCA and agrees to furnish any information and documents the Company may from time to time request, including but not limited to information required under FATCA;

22.  represents and warrants that, if the Placee is a natural person, such Placee is not under the age of majority (18 years of age in the UK) on the date of such Placee's agreement to acquire Placing Shares under the Placing and will not be any such person on the date any such offer is accepted;

23.  represents and warrants that, if it is acquiring any Placing Shares as a fiduciary or agent for one or more accounts, it has sole investment discretion with respect to each such account and full power and authority to make such foregoing representations, warranties, acknowledgements and agreements on behalf of each such account;

24.  represents and warrants that, if it is a financial intermediary, as that term is used in Article 5(1) of the UK Prospectus Regulation, the Placing Shares purchased by it in the Placing will not be acquired on a non-discretionary basis on behalf of, nor will they be acquired with a view to their offer or resale to (i) persons in a Member State or (ii) persons in the United Kingdom other than to persons who are: "qualified investors" as defined in Article 2(e) of the UK Prospectus Regulation or who otherwise fall within Article 1(4)(a) to (d) of the UK Prospectus Regulation (and which circumstances do not result in any requirement for the publication of a prospectus pursuant to Article 3 of the UK Prospectus Regulation) and in each case (iii) who are also professional investors for the purposes of the UK AIFM Regime or in circumstances in which the prior consent of Jefferies has been given to the offer or resale;

25.  represents and warrants that it has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) relating to the Placing Shares in circumstances in which it is permitted to do so pursuant to section 21 of FSMA;

26.  represents and warrants that it has complied and will comply with all applicable provisions of FSMA with respect to anything done by it in relation to the Placing Shares in, from or otherwise involving the United Kingdom;

27.  represents and warrants that it has complied with its obligations under the Criminal Justice Act 1993, section 118 of FSMA, MAR, UK MAR and in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002 (as amended), the Terrorism Act 2000, the Terrorism Act 2006, the Money Laundering Regulations 2007 (the "Regulations") and the Money Laundering Sourcebook of the FCA and, if making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Regulations. If within a reasonable time after a request for verification of identity, Jefferies has not received such satisfactory evidence, Jefferies may, in its absolute discretion, terminate the Placee's participation in the Placing in which event all funds delivered by the Placee to Jefferies will be returned without interest to the account of the drawee bank or Euroclear securities account from which they were originally debited;

28.  if in the United Kingdom, represents and warrants that it is (a) a person falling within Article 19(5) of the FPO or (b) a person falling within Article 49(2)(a) to (d) of the FPO and is a "professional client" or an "eligible counterparty" within the meaning of Chapter 3 of the FCA's Conduct of Business Sourcebook and undertakes that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business;

29.  if in the United Kingdom represents and warrants that it is a is a qualified investor falling within Article 2(e) of the UK Prospectus Regulation;

30.  represents and warrants that it has not offered or sold and will not offer or sell any Placing Shares in any Member State;

31.  represents and warrants that, save where agreed otherwise in writing with Jefferies, it is not located in a Member State;

32.  represents and warrants that, if it is acting as a "distributor" (for the purposes of the UK Product Governance Requirements):

(a)  it acknowledges that the Target Market Assessment undertaken by the Fund Manager and Jefferies does not constitute: (a) an assessment of suitability or appropriateness for the purposes of COBS; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares and each distributor is responsible for undertaking its own target market assessment in respect of the Placing Shares and determining appropriate distribution channels;

(b)  notwithstanding any Target Market Assessment undertaken by the Fund Manager and Jefferies, it confirms that, other than where it is providing an execution-only service to investors, it has satisfied itself as to the appropriate knowledge, experience, financial situation, risk tolerance and objectives and needs of the investors to whom it plans to distribute the Placing Shares and that it has considered the compatibility of the risk/reward profile of such Placing Shares with the end target market; and

(c)  it acknowledges that the price of the Placing Shares may decline and investors could lose all or part of their investment; the Placing Shares offer no guaranteed income and no capital protection; and an investment in the Placing Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom;

33.  undertakes that it (and any person acting on its behalf) will pay for the Placing Shares acquired by it in accordance with this announcement on the due time and date set out herein against delivery of such Placing Shares to it, failing which the relevant Placing Shares may be placed with other Placees or sold as Jefferies may, in its absolute discretion, determine and it will remain liable for any shortfall below the net proceeds of such sale and the placing proceeds of such Placing Shares and may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties due pursuant to the terms set out or referred to in this announcement) which may arise upon the sale of such Placee's Placing Shares on its behalf;

34.  acknowledges that neither Jefferies, nor any of its affiliates nor any person acting on its behalf is making any recommendations to it or advising it regarding the suitability or merits of any transaction it may enter into in connection with the Placing, and acknowledges that Jefferies, nor any of its affiliates nor any person acting on their behalf has any duties or responsibilities to it for providing advice in relation to the Placing or in respect of any representations, warranties, undertakings or indemnities contained in the Placing Agreement or for the exercise or performance of any of Jefferies rights and obligations thereunder, including any right to waive or vary any condition or exercise any termination right contained therein;

35.  undertakes that (i) the person whom it specifies for registration as holder of the Placing Shares will be (a) the Placee or (b) the Placee's nominee, as the case may be, (ii) neither Jefferies nor the Company will be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe this requirement and (iii) the Placee and any person acting on its behalf agrees to acquire the Placing Shares on the basis that the Placing Shares will be allotted to the CREST stock account of Jefferies which will hold them as settlement agent as nominee for the Placee until settlement in accordance with its standing settlement instructions with payment for the Placing Shares being made simultaneously upon receipt of the Placing Shares in the Placee's stock account on a delivery versus payment basis;

36.  acknowledges and agrees that these terms and conditions and any agreements entered into by it pursuant to these terms and conditions, and any non-contractual obligations arising out of or in connection with such agreements, shall be governed by and construed in accordance with the laws of England and Wales and it submits (on behalf of itself and on behalf of any person on whose behalf it is acting) to the exclusive jurisdiction of the courts of England and Wales as regards any claim, dispute or matter arising out of any such contract, except that enforcement proceedings in respect of the obligation to make payment for the Placing Shares (together with any interest chargeable thereon) may be taken by Jefferies or the Company in any jurisdiction in which the relevant Placee is incorporated or in which any of its securities have a quotation on a recognised stock exchange;

37.  acknowledges and agrees that it irrevocably appoints any member of Jefferies as its agent for the purposes of executing and delivering to the Company and/or its registrars any documents on its behalf necessary to enable it to be registered as the holder of any of the Placing Shares agreed to be taken up by it under the Placing;  

38.  acknowledges and agrees that time shall be of the essence as regards its obligations to settle payment for the Placing Shares and to comply with its other obligations under the Placing;

39.  represents and warrants that, save where agreed otherwise in writing with Jefferies, it is not a resident of any Restricted Jurisdiction and acknowledges that the Placing Shares have not been and will not be registered nor will a prospectus be cleared in respect of the Placing Shares under the securities legislation of any Restricted Jurisdiction and, subject to certain exceptions, may not be offered, sold, taken up, renounced, delivered or transferred, directly or indirectly, within any Restricted Jurisdiction;

40.  represents and warrants that any person who confirms to Jefferies on behalf of a Placee an agreement to subscribe for Placing Shares and/or who authorises Jefferies to notify the Placee's name to the Company's registrar, has authority to do so on behalf of the Placee;

41.  acknowledges that the agreement to settle each Placee's acquisition of Placing Shares (and/or the acquisition of a person for whom it is contracting as agent) free of stamp duty and stamp duty reserve tax depends on the settlement relating only to an acquisition by it and/or such person direct from the Company of the Placing Shares in question. Such agreement assumes that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to issue or transfer the Placing Shares into a clearance service. If there were any such arrangements, or the settlement related to other dealing in the Placing Shares, stamp duty or stamp duty reserve tax may be payable, for which neither the Company nor Jefferies will be responsible. If this is the case, the Placee should take its own advice and notify Jefferies accordingly;

42.  acknowledges that the Placing Shares will be issued and/or transferred subject to the terms and conditions set out in this announcement (including this Appendix);

43.  to the fullest extent permitted by law, the Placee acknowledges and agrees to the disclaimers contained in this announcement;

44.  represents and warrants that, the Placee is not, and is not applying as, nor is it applying as nominee or agent for, a person which is, or may be, mentioned in any of sections 67, 70, 93 and 96 of the Finance Act 1986 (depository receipts and clearance services) and that the Placing Shares are not being acquired in connection with arrangements to issue depository receipts or to issue or transfer Placing Shares into a clearing system;

45.  acknowledges that when a Placee or any person acting on behalf of the Placee is dealing with Jefferies, any money held in an account with Jefferies on behalf of the Placee and/or any person acting on behalf of the Placee will not be treated as client money within the meaning of the relevant rules and regulations of the FCA. The Placee acknowledges that the money will not be subject to the protections conferred by the client money rules; as a consequence, this money will not be segregated from Jefferies' money in accordance with the client money rules and will be used by Jefferies in the course of its business; and the Placee will rank only as a general creditor of Jefferies (as the case may be);

46.  acknowledges and understands that the Company, Jefferies, and others will rely upon the truth and accuracy of the foregoing representations, warranties, agreements, undertakings and acknowledgements;

47.  acknowledges that the basis of allocation will be determined by the Company at its absolute discretion in consultation with Jefferies and the Fund Manager. The right is reserved to reject in whole or in part and/or scale back any participation in the Placing;

48.  irrevocably authorises the Company and Jefferies to produce this announcement pursuant to, in connection with, or as maybe required by any applicable law or regulation, administrative or legal proceeding or official inquiry with respect to the matters set forth herein; and 

49.  acknowledges and agrees that its commitment to subscribe for Placing Shares on the terms set out herein will continue notwithstanding any amendment that may in future be made to the terms of the Placing and that Placees will have no right to be consulted or require that their consent be obtained with respect to the Company's conduct of the Placing.

The acknowledgements, agreements, undertakings, representations and warranties referred to above are given to each of the Company and Jefferies (for its own benefit and, where relevant, the benefit of its affiliates and any person acting on its behalf) and are irrevocable.

No claim shall be made against the Company, Jefferies, its affiliates or any other person acting on behalf of any of such persons by a Placee to recover any damage, cost, charge or expense which it may suffer or incur by reason of or arising from the carrying out by it of the work to be done by it pursuant hereto or the performance of its obligations hereunder or otherwise in connection with the Placing.

Miscellaneous

No UK stamp duty or stamp duty reserve tax should be payable to the extent that the Placing Shares are issued or transferred (as the case may be) into CREST to, or to the nominee of, a Placee who holds those shares beneficially (and not as agent or nominee for any other person) within the CREST system and registered in the name of such Placee or such Placee's nominee.

Any arrangements to issue or transfer the Placing Shares into a depositary receipts system or a clearance service or to hold the Placing Shares as agent or nominee of a person to whom a depositary receipt may be issued or who will hold the Placing Shares in a clearance service, or any arrangements subsequently to transfer the Placing Shares, may give rise to stamp duty and/or stamp duty reserve tax, for which neither the Company nor Jefferies will be responsible and the Placee to whom (or on behalf of whom, or in respect of the person for whom it is participating in the Placing as an agent or nominee) the allocation, allotment, issue or delivery of Placing Shares has given rise to such stamp duty or stamp duty reserve tax undertakes to pay such stamp duty or stamp duty reserve tax forthwith and to indemnify on an after-tax basis and to hold harmless the Company and Jefferies in the event that the Company and/or Jefferies have incurred any such liability to stamp duty or stamp duty reserve tax. 

In addition, Placees should note that they will be liable for any capital duty, stamp duty and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto) payable outside the UK by them or any other person on the acquisition by them of any Placing Shares or the agreement by them to acquire any Placing Shares.

All times and dates in this announcement may be subject to amendment. Jefferies shall notify the Placees and any person acting on behalf of the Placees of any such changes. 

This announcement has been issued by the Company and is the sole responsibility of the Company.

Each Placee, and any person acting on behalf of the Placee, acknowledges that Jefferies does not owe any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings or indemnities in the Placing Agreement. 

Each Placee and any person acting on behalf of the Placee acknowledges and agrees that Jefferies or any of its affiliates may, at their absolute discretion, agree to become a Placee in respect of some or all of the Placing Shares. 

The rights and remedies of Jefferies and the Company under these terms and conditions are in addition to any rights and remedies which would otherwise be available to each of them and the exercise or partial exercise or partial exercise of one will not prevent the exercise of others. 

Each Placee may be asked to disclose in writing or orally to Jefferies:

a)  if an individual, that Placee's nationality; or

b)  if a discretionary fund manager, the jurisdiction in which the funds are managed or owned.

 

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[1] The expected dividend and dividend target are an expectation and a target only and are not profit forecasts. There can be no assurance that the expected dividend will be paid or the dividend target will be met and they should not be taken as an indication of the Company's future results.

 

END

 

 

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