Incentive Arrangements - Proposed Amendments

RNS Number : 9993S

KKV Secured Loan Fund Limited

22 November 2021

 

22 November 2021

KKV Secured Loan Fund Limited

LEI: 2138007S3YRY3IUU4W39

Incentive Arrangements - Proposed Amendments

On 1 November 2021, KKV Secured Loan Fund Limited (the "Company") announced details of a proposed Incentive Plan and Bonus Payment, both of which will be subject to a shareholder vote at the Company's annual general meeting ("AGM") on 29 November 2021.

The Company is proposing to make the following amendments to the proposed Incentive Plan and Bonus Payment, subject to the relevant resolutions passing at the AGM:

· It is currently proposed that 1.4% of the aggregate funds distributed to shareholders since 1 July 2021 shall be allocated to the Bonus Pool under the Incentive Plan. The Board will reduce the amount allocated to the Bonus Pool, in respect of any funds distributed to shareholders later than 31 December 2023 but before 30 June 2024 to 1.0% and will reduce the percentage allocated to the Bonus Pool by a further 0.2% for every 3 months thereafter.

· The Board propose that the absolute amount payable under the Incentive Plan be capped at £2.3 million; and

· The Board propose that the Bonus Payment shall be payable in two tranches, with half being payable prior to the end of 2021 and the balance to be deferred until the earlier of 1 January 2023 and the date at which a further £30 million has been returned to shareholders.

The details of the proposed Incentive Plan and Bonus Payment are set out below this announcement, reflecting the above changes.

Terms used in this announcement shall, unless the context otherwise requires, bear the meanings given to them in RNS announcement by the Company on 1 November 2021.

For further information please contact: 

KKV Secured Loan Fund Limited	Brett Miller via the Company Secretary
KKV Investment Management Ltd	[e-mail]
BNP Paribas Securities Services S.C.A., Guernsey Branch Company Secretary	[e-mail]

Incentive Plan

The structure of the Incentive Plan is for a Bonus Pool to be created for Directors (save for an Independent Director who shall not participate in the Incentive Plan), employees and consultants of the Company (both present and future) comprising cash equivalent to 1.4% of the aggregate funds distributed to shareholders since 1 July 2021 for a period up to 31 December 2023, following which the amount shall fall to 1.0% of aggregate funds distributed to shareholders for the period from 1 January 2023 to 30 June 2024 and will thereafter reduce by a further 0.2% every 3 months.  The precise allocation of the Bonus Pool will be at the discretion of the Board, subject to the approval of the Independent Director.  The Board will not distribute more than 50% of the Bonus Pool until such time as the Net Assets of the Company fall below £20m and no part of the Bonus Pool will be paid out until such time as a minimum of £80m has been returned to Shareholders cumulatively since 1 July 2021.

The Bonus Pool will be capped at 2.0% of the Net Asset Value of the Company as at 30 June 2021 (or such lower amount as to ensure that the Incentive Plan is considered to be a smaller related party transaction), subject to an absolute cap of £2.3m.

Bonus Payment

In light of the events during the last 12 months, the Board have been required to devote considerably more time to the affairs of the Company than would otherwise be expected of a board comprising a majority of non-executive directors.  To recognise their efforts, the Board proposes a one-off cash bonus of £280,000 to the Directors, payable in such proportions as the Directors determine. The Bonus Payment shall be payable in two tranches, with half being payable prior to the end of 2021 and the balance to be deferred until the earlier of 1 January 2023 and the date at which  a  further £30m has been returned to shareholders.

 

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