CLC Calculus Vct Plc

 
TIDMISP 
 
INVESTEC STRUCTURED PRODUCTS CALCULUS VCT PLC 
 
11 AUGUST 2010 
 
RECOMMENDED PROPOSALS TO AUTHORISE THE ISSUE OF ORDINARY SHARES, AMEND THE 
ARTICLES, CREATE AND AUTHORISE THE ISSUE OF C SHARES, RENEW THE AUTHORITY TO 
REPURCHASE SHARES, CANCEL SHARE PREMIUM, AMEND THE INVESTMENT OBJECTIVE AND 
POLICY AND APPROVE THE RELATED PARTY TRANSACTIONS 
 
SUMMARY 
 
The board of directors of the Company ("Board") is pleased to advise that they 
are today writing to shareholders with proposals to authorise further funds 
being raised through the issue of ordinary shares of 1p each ("Ordinary 
Shares") and then a subsequent issue of C ordinary shares of 1p each ("C 
Shares"), the latter to be managed as a separate pool of assets. 
 
In order to proceed with these fundraisings, approval from shareholders is 
required to authorise the issue of Ordinary Shares and C Shares. In addition, 
amendments to the existing articles of association ("Articles") and the 
investment objective and policy are required to take into account a separate 
class of C Shares, as well as enter into related party transactions with 
Investec Structured Products and Calculus Capital Limited (the investment 
managers of the Company ("the Managers")). The Board also proposes to renew its 
general share allotment and buyback authorities and cancel share premium 
created by the issue of further shares. 
 
The above proposals require the approval of resolutions to be proposed to 
shareholders of the Company at a general meeting to be held on 6 September 2010 
("the General Meeting"). 
 
BACKGROUND 
 
The Company was launched in March 2010 and raised GBP3.8 million (before 
expenses). The Board was encouraged by the level of investor demand for this 
first funding round for the Company, particularly given its late launch before 
the end of the 2009/2010 tax year. 
 
ORDINARY SHARE OFFER 
 
The Board intends to launch the offer for Ordinary Shares ("Ordinary Share 
Offer") in early September 2010 to raise up to GBP10 million. 
 
The offer price for the Ordinary Shares will be linked to NAV plus offer costs 
so as to avoid dilution to existing holders of Ordinary Shares. The funds 
raised will be added to the existing Ordinary Shares fund and invested in 
accordance with the investment policy of the Company. If the Ordinary Share 
Offer proceeds and funds are raised, the Company will increase its size and 
annual running costs can be split over a larger asset base. 
 
CREATION OF C SHARE AND THE C SHARE OFFER 
 
The Articles will be amended to provide for the rights attaching to the C 
Shares and the funds raised by the issue of C Shares will be managed and 
accounted for separately by the Company. 
 
The C Shares will rank pari passu with the Ordinary Shares from the date of 
issue, save that each class of share will be entitled to the assets, 
distributions and returns on liquidation arising in respect of their relevant 
fund. 
 
The segregation of the Company's assets into two funds will mean that the 
holders of Ordinary Shares will be exclusively entitled to receive the net 
returns flowing from the investments made out of the Ordinary Shares fund, 
whilst the holders of C Shares will be exclusively entitled to receive the 
returns flowing from investments made out of the C Shares fund. Each fund will 
bear its pro rata share (based on net assets) of the annual running costs of 
the Company, unless expenses can be attributed to a particular fund. 
 
The Board intends to launch the offer for C Shares ("C Share Offer") to raise 
up to GBP25 million in December 2010 and to close the C Share Offer at the end of 
April 2011. The C Shares, as a new separate class, will be issued at GBP1 per 
share. Creation of a separate class of C Shares and the C Share Offer seeks to 
further increase the size of the Company over which the annual running costs 
can be spread. 
 
AMENDMENT TO THE INVESTMENT OBJECTIVE AND POLICY 
 
The existing investment objective and policy of the Company is specifically 
drafted on the basis of there being one share class in issue. In order to 
provide for an investment objective and policy which sits across both the 
Ordinary Shares fund and the C Shares fund (as well as any subsequent class of 
shares the Company may issue in the future), it is proposed that the existing 
investment objective and policy be amended to be generic and stand alone. 
 
RELATED PARTY TRANSACTIONS 
 
The existing management and performance incentive arrangements and other 
provisions relating to the Ordinary Shares fund will automatically extend and 
apply to the funds raised pursuant to the Ordinary Share Offer. 
 
Supplemental investment management agreements with each of the Managers will be 
entered into in respect of investment management services for the C Shares 
fund, materially on the same terms as the existing arrangements for the 
Ordinary Shares fund. Pursuant to these supplemental arrangements, Calculus 
Capital will receive an annual investment management fee of an amount 
equivalent to 1.0 per cent. of the net assets of the Company attributable to 
the C Shares fund. Investec Structured Products will not receive any annual 
management fees from the Company in respect of the C Shares fund. 
 
A supplemental performance incentive agreement with both of the Managers will 
also be entered into in respect of performance incentive fees for the C Shares 
fund, materially on the same terms as the arrangements for the Ordinary Shares 
fund. Pursuant to this supplemental arrangement, the Managers will each receive 
a performance incentive fee payable in cash of an amount equal to 10 per cent. 
of dividends and distributions paid (including the relevant distribution being 
offered) to the holders of C Shares over and above 105p per C Share. Such 
payment will be subject to holders of C Shares having received an interim 
return per C Share, the amount to be agreed before launch of the C Shares 
Offer, (whether through dividends or other distributions on C Shares, C Share 
buy-backs and any other proceeds or value received or offered per C Share, 
excluding initial income tax relief on subscriptions for C Shares) on or before 
14 December 2016. 
 
Investec Structured Products will also act as promoter to the Ordinary Share 
Offer and the C Share Offer and will be paid a commission of 5.0 per cent. of 
the gross proceeds raised from each offer, from which all costs and expenses 
(including initial intermediary commission but excluding trail commission) of 
the relevant offer will be paid. Any costs above this will be met by Investec 
Structured Products. 
 
The proposed management and performance incentive arrangements to be entered 
into in respect of the C Shares fund and the proposed commission payment of 5.0 
per cent. of the funds raised pursuant to the offers to Investec Structured 
Products are related party transactions under the Listing Rules and therefore 
require the approval of the Company's shareholders. 
 
SHARE ISSUE AND BUY-BACK AUTHORITIES AND CANCELLATION OF SHARE PREMIUM 
 
In addition to taking Shareholder authority to allot Ordinary Shares and C 
Shares in connection with the offers, the Company also proposes to renew and 
increase its general share issue authorities at the General Meeting (in 
particular to take into account the expected enlarged share capital position 
following the offers). It is also proposed to renew and increase the buy-back 
authority at the General Meeting (again in particular to take into account the 
expected enlarged share capital position following the offers). 
 
The issue of new shares pursuant to the Ordinary Share Offer and C Share Offer 
will result in the creation of further share premium. The Board considers it 
appropriate to obtain approval of the Company's shareholders at the General 
Meeting to cancel the further share premium attributable to shares issued 
pursuant to such offers (subject to court sanction) to create further 
distributable reserves to fund distributions to Shareholders and buy-backs, to 
set off or write off losses and for other corporate purposes of the Company. 
 
FURTHER INFORMATION 
 
Shareholders will receive a copy of a circular convening the General Meeting to 
be held on 6 September 2010 at which shareholders will be invited to approve 
resolutions in connection with the proposals. A copy of the circular for the 
Company has also been submitted to the UK Listing Authority and will be shortly 
available for inspection at the UK Listing Authority's Document Viewing 
Facility which is situated at: 
 
Financial Services Authority 
25 The North Colonnade 
Canary Wharf 
London E14 5HS 
Telephone: 0207 066 1000 
 
For further information, please contact: 
 
Investment Manager to the Structured Products Portfolio 
Investec Structured Products 
Gary Dale 
Telephone: 020 7597 4065 
 
Investment Manager to the Venture Capital Portfolio 
Calculus Capital Limited 
Susan McDonald 
Telephone: 020 7493 4940 
 
END 
 

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