TIDMCQS TIDMCQSU
RNS Number : 7849I
CQS Diversified Fund Limited
21 June 2011
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS NOT
FOR PUBLICATION, DISTRIBUTION OR RELEASE IN, OR INTO, DIRECTLY OR
INDIRECTLY, THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN OR TO
U.S. PERSONS OR ANY JURISDICTION IN WHICH SUCH PUBLICATION,
DISTRIBUTION OR RELEASE IS UNLAWFUL.
CQS Diversified Fund Limited
21 June 2011
Proposed Placing of New Ordinary Shares
Introduction
CQS Diversified Fund Limited (the "Company") today announces a
proposed placing for cash of new ordinary shares representing in
aggregate up to 9.99 per cent. of each class of the Company's
issued ordinary share capital (the "Placing").
Following the Company's launch, which raised GBP74.4 million in
December 2010, the Company's shares have performed strongly with
the shares of each class trading at a consistent premium to NAV.
The Board is aware of significant interest in the Company's shares
from a range of investors and, accordingly, the Placing is being
undertaken to address investor demand.
The investment objective of the Company is to achieve attractive
risk-adjusted returns over the medium to long term by primarily
investing in convertible and credit-related strategies. The Company
seeks to achieve its investment objective by investing
substantially all of its assets in CQS Diversified Fund (SPC)
Limited ("DVA"). DVA seeks to mitigate the risks and volatility
associated with investing in individual strategies by constructing
a portfolio of Underlying Funds across a range of strategies.
Over the period from inception to 31 May 2011, the Company has
been able to demonstrate a positive performance track record as
illustrated by the NAV performance of the Company's Shares set out
in the table below:
2011 (%) Jan Feb Mar Apr May YTD
Sterling Shares 1.39 0.51 0.58 0.67 (0.49) 2.69
US$ Shares 1.40 0.50 0.54 0.70 (0.52) 2.64
Sources: Company
The following tables show the annual net asset value performance
of DVA's US$ B Shares month on month since inception to 31 May
2011:
Class
B USD
(%) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec YTD
2011 1.44 0.50 0.55 0.70 (0.49) - - - - - - - 2.70
2010 1.71 1.35 2.11 1.79 (4.36) 0.35 2.57 1.82 2.56 2.12 0.37 1.54 14.62
2009 1.85 2.14 (2.31) 0.41 2.94 2.00 4.85 1.90 3.98 2.35 1.09 1.50 24.99
2008 0.76 2.03 (0.16) 0.22 1.60 4.27 (1.87) (0.18) (5.47) (7.44) 0.76 (1.31) (7.14)
2007 - - 1.43 1.58 1.08 (0.98) (2.12) (0.35) 1.81 5.59 1.22 1.19 10.77
Source: CQS
CQS seeks to achieve an absolute, annualised net return target
of 12-15 per cent. over the medium to long term in respect of DVA.
DVA had a net return over 12 months to May 2011 of 14.88 per cent.
and an annualised return since inception of 10.24 per cent.
Pursuant to the Placing, the Company proposes to issue:
-- up to 6,502,060 new Sterling Shares (the "New Sterling
Shares"); and
-- up to 1,459,156 new US$ Shares (the "New US$ Shares");
together, the "Placing Shares".
The Placing, which is subject to the fulfilment of certain
conditions, is being conducted through an institutional
book-building process to be carried out by RBS Hoare Govett Limited
("RBS Hoare Govett") who is acting as sole bookrunner, placing
agent and corporate broker in connection with the Placing (the
"Bookrunner").
The precise number of Placing Shares to be issued and the
placing price per share of each class of the Placing Shares (the
"Placing Price") will be determined following the completion of the
book-building, which is currently scheduled for 3.00 p.m. (London
time) on 21 June 2011 and a further announcement will be made as
soon as practicable once the results of the Placing are known. The
Placing Price will be determined by reference to the prevailing net
asset value and share price for each class of Placing Shares. In
any event, the Placing Price will not be less than the aggregate of
the prevailing estimated net asset value per share for the relevant
class of the Company's shares (as contained in the latest weekly
net asset value estimate released by the Company prior to the close
of the Placing) and the expenses of the Placing.
In the event that the Placing is oversubscribed, the scaling
back of allocations of Placing Shares shall be determined by the
Bookrunner, after consultation with CQS and the Company. CQS have
indicated to the Bookrunner and the Company that, where excess
demand remains unfulfilled following this allocation process,
certain shareholders in the Company affiliated with CQS would
consider selling Shares to Placees at the Placing Price.
The net proceeds of the Placing will be all or substantially all
invested in shares of DVA in accordance with the Company's
investment objective and policy. The Company anticipates that
substantially all of the aggregate net proceeds of the Placing will
be invested by 1 July 2011.
Background
CQS Diversified Fund Limited is a registered closed-ended
investment company registered and incorporated in Guernsey with an
unlimited life. The Company was launched in December 2010 when the
Shares were admitted to the premium listing segment of the Official
List and to trading on the London Stock Exchange plc's main market
for listed securities.
As at 20 June 2011, the Company's total issued share capital
consisted of 79,731,742 Shares, of which 65,025,567 were designated
as Sterling Shares and 14,706,175 as US$ Shares. As at 10 June 2011
(the date of the last estimated weekly net asset value), the
unaudited aggregate net assets of the Company (in Sterling terms)
were approximately GBP74.9 million, equivalent to an unaudited NAV
per Sterling Share of GBP1.0099 and per US$ Share of US$1.0092.
The investment objective of the Company is to achieve attractive
risk-adjusted returns over the medium to long term by primarily
investing in convertible and credit-related strategies. The Company
seeks to achieve its investment objective by investing
substantially all of its assets in DVA.
DVA is a fund incorporated in the Cayman Islands with an
investment objective to generate attractive risk adjusted returns
over the medium to long term. DVA seeks to mitigate the risks and
volatility associated with investing in individual strategies by
constructing a portfolio of Underlying Funds across a range of
strategies. Investors in the Company participate indirectly in the
investment portfolio of DVA.
DVA is currently invested in the Existing Underlying Funds which
currently comprise CQS Convertible and Quantitative Strategies
Feeder, CQS Directional Opportunities Feeder, CQS ABS Feeder, CQS
Asia Feeder, CQS Credit Long Short Feeder, all of which are managed
by CQS and primarily invest in convertible and credit related
strategies. The portfolio of Underlying Funds may in the future
exclude any or all of the above funds and/or include any other
investment fund in which DVA may invest from time to time, whether
or not managed by CQS.
As at 31 May 2011, the investment portfolio of DVA was allocated
on the following basis amongst the Existing Underlying Funds:
Allocation
Underlying Fund (%)
CQS Convertible and Quantitative Strategies Feeder 23.61
CQS Directional Opportunities Feeder 24.11
CQS ABS Feeder 21.83
CQS Asia Feeder 15.27
CQS Credit Long Short Feeder 14.14
Cash 1.04
100.00
-----------
Source: CQS
DVA is able to reallocate between the Underlying Funds on a
periodic basis which enables CQS to manage the risk of DVA itself
and exploit investment opportunities. In determining the desired
portfolio of investments from time to time, CQS considers factors
in relation to each Underlying Fund including, but not limited to:
historic and expected returns, risk-adjusted returns and return
volatilities; expected alpha; liquidity terms; correlations between
strategies and returns for comparative strategies. Potential risks
and returns are qualitative inputs from the senior investment
officer, chief investment officers and senior portfolio managers of
each of the Underlying Funds captured through a monthly Investment
Advisory Committee. Probability adjusted returns of the Underlying
Funds are analysed to estimate and assess prospective total return.
CQS uses the above inputs combined with portfolio risk management
models and its judgement, to manage the portfolio allocation
decisions for DVA towards achieving its investment objectives.
Further details regarding the Placing
The book-building will start with immediate effect. The timing
of the closing of the book, pricing and allocations is at the
discretion of the Company, CQS and the Bookrunner, although the
Placing is expected to close not later than 3.00 p.m. (London time)
on 21 June 2011. However, the Bookrunner reserves the right to
accept further bids after initial allocations have been made. The
number of Placing Shares and the Placing Price for each class of
Placing Shares will be agreed between the Company, CQS and the
Bookrunner at the close of the book-building process. Details of
the number of Placing Shares and the Placing Price for each class
of Placing Shares will be announced as soon as practicable after
the close of the book-building process.
Each class of Placing Shares will be issued credited as fully
paid and will rank pari passu in all respects with the Company's
existing Shares of the same currency class. The Company will apply
for admission of the Placing Shares to the premium listing segment
of the Official List of the Financial Services Authority and to
trading on the London Stock Exchange plc's market for listed
securities (together, "Admission"). Settlement of the Placing
Shares will be on a T+3 basis. It is expected that settlement and
Admission will take place on 27 June 2011.
The Royal Bank of Scotland N.V. (London Branch) ("RBS") is
acting as execution and settlement agent in respect of the Placing.
Applications for Placing Shares should be communicated to a
participant's usual sales contact at RBS, specifying the number and
class of Placing Shares which are being offered to be acquired at
the Placing Price which is ultimately established by the Company,
CQS and the Bookrunner. Successful applicants under the Placing
will receive Placing Shares subject to the satisfaction or waiver
of the conditions contained in the placing agreement between the
Company, the Bookrunner, CQS Cayman Limited Partnership and CQS
(UK) LLP dated 21 June 2011 (the "Placing Agreement") and that
agreement not having been terminated.
The Company has undertaken that during a period of three months
from the date of Admission it will not, without the prior written
consent of RBS Hoare Govett (such consent not to be unreasonably
withheld or delayed), directly or indirectly, offer, issue, lend,
sell or contract to sell, issue options in respect of, or otherwise
dispose of, directly or indirectly, or announce an offering or
issue of, any shares in the Company (or any interest therein or in
respect thereof) or any other securities exchangeable for or
convertible into, or substantially similar to, shares in the
Company or enter into any transaction with the same economic effect
as, or agree to do, any of the foregoing.
Attention is drawn to the full details of the terms and
conditions of the Placing which are set out in the Appendix to this
announcement (and which forms part of this announcement). Persons
participating in the Placing will be deemed to have read and
understood the full terms and conditions relating to the Placing
and to be participating on the basis that they accept such terms
and conditions in full. Certain terms used in this announcement and
the Appendix are defined in the schedule at the end of the
announcement.
Enquiries:
Michael Rummel Tel: +44 (0)20 7201
CQS 6900
Gary Gould / Stuart Klein Tel: +44 (0)20 7678
RBS Hoare Govett Limited 8000
Important notices
This announcement has been issued by, and is the sole
responsibility of, the Company.
Attention is drawn to the detailed terms and conditions of the
Placing described in the Appendix to this announcement.
Members of the public are not eligible to take part in the
Placing and no public offering of securities will be made.
This announcement is directed only at persons selected by the
Bookrunner who are: (a) persons in member states of the European
Economic Area who are qualified investors as defined in Article
(2)(1)(e) ("qualified investors") of Directive 2003/71/EC, as
amended; (b) in the United Kingdom, qualified investors who are
also persons (1) who have professional experience in matters
relating to investments falling within Article 19(5) (investment
professionals) of the Financial Services and Markets Act 2000
(Financial Promotion) Order 2005 (as amended) (the "Order") or (2)
falling within Article 49(2)(a) to (d) (high net worth companies,
incorporated associations, etc.) of the Order; and (c) other
persons to whom it may otherwise lawfully be communicated (all such
persons together being referred to as "Relevant Persons").
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 and the book-building set out in this
announcement are for information purposes only.
Neither this announcement nor the appendix constitutes an offer
or an invitation to acquire or dispose of any securities in the
Company.
This announcement and the information contained herein does not
constitute an offer to sell or issue or the solicitation of an
offer to buy or acquire Shares in the Company in the United States,
Australia, Canada or Japan or to any U.S. Person as defined in
Regulation S under the United States Securities Act of 1933, as
amended (the "Securities Act") or into any jurisdiction in which
such offer or solicitation is unlawful.
The Placing Shares have not been and will not be registered
under the Securities Act or under the securities laws of any state
or other jurisdiction of the United States and may not be offered,
sold, resold or delivered, directly or indirectly, except in
offshore transactions in accordance with Regulation S to a person
outside the United States and not known by the transferor to be a
U.S. person (as defined in Regulation S) by pre-arrangement or
otherwise.. No public offering of the Placing Shares is being made
in the United States. The Placing is being made outside the United
States in offshore transactions to non-U.S. persons in accordance
with Regulation S under the Securities Act. Persons receiving this
document (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. The Company has not,
and will not be, registered under the Investment Company Act and
investors will not be entitled to the benefits of the Investment
Company Act.
The distribution of this document, the Placing and/or issue of
the Placing Shares in certain jurisdictions may be restricted by
law and/or regulation. No action has been taken by the Company or
the Bookrunner or any of their respective Affiliates (as defined
below) that would permit an offer of the Placing Shares or
possession or distribution of this document or any other publicity
material relating to such Placing Shares in any jurisdiction where
action for that purpose is required. Persons receiving this
document are required to inform themselves about and to observe any
such restrictions.
By participating in the Placing, each person who is invited to
and who chooses to participate in the Placing (a "Placee") by
making an oral offer to take up Placing Shares is deemed to have
read and understood this document in its entirety and to be
providing the representations, warranties, undertakings, agreements
and acknowledgements contained herein.
Prospective investors should note that the Placing Shares may
not be acquired or held by, or transferred to, (a) any "employee
benefit plan" (as defined in Section 3(3) of the United States
Employee Retirement Income Security Act of 1974, as amended
("ERISA")) that is subject to Part 4 of Subtitle B of Title 1 of
ERISA, any plan described in Section 4975(e)(1) of the US Internal
Revenue Code of 1986, as amended (the "Code") to which Section 4975
of the Code applies, or any entity whose underlying assets include
plan assets by reason of a plan's investment in such entity (each a
"Benefit Plan Investor"), (b) any other employee benefit plan that
is subject to provisions of any federal, state, local or other law
or regulation that are substantially similar to the prohibited
transaction provisions of Section 406 of ERISA or Section 4975 of
the Code (an "Other Plan"), or (c) any person acting on behalf of
or using the assets of any Benefit Plan Investor or Other Plan with
respect to the purchase, holding or disposition of the Placing
Shares.
This announcement has been prepared by the Company and is the
sole responsibility of the Company. No liability whatsoever
(whether in negligence or otherwise) arising directly or indirectly
from the use of this announcement is accepted and no
representation, warranty or undertaking, express or implied, is or
will be made by the Company or RBS Hoare Govett or any of their
respective affiliates, or any of their or their affiliates's
directors, officers, employees, advisers, representatives or other
agents, and as applicable, any other CQS branded entity ("Agents")
for any information or any of the opinions contained herein or for
any errors, omissions or misstatements. Neither the Company, RBS
Hoare Govett nor their respective Agents makes or has been
authorised to make any representation or warranties (express or
implied) in relation to the Company or as to the truth, accuracy or
completeness of this announcement, or any other written or oral
statement provided. In particular, no representation or warranty is
given as to the achievement or reasonableness of, and no reliance
should be placed on any projections, targets, estimates or
forecasts contained in this announcement and nothing in this
announcement is or should be relied on as a promise or
representation as to the future.
RBS Hoare Govett, which is authorised and regulated in the
United Kingdom by the Financial Services Authority, is acting
exclusively 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 clients of RBS
Hoare Govett nor for providing advice to any other person in
relation to the Placing or any other matters referred to in this
announcement.
In connection with the Placing, RBS Hoare Govett and any of its
affiliates, acting as investors for their own accounts, may
subscribe for or purchase Shares and in that capacity may retain,
purchase, sell, offer to sell or otherwise deal for their own
accounts in such Shares and other securities of the Company or
related investments in connection with the placing and offer for
subscription or otherwise. Accordingly, references in this
announcement to the Shares being issued, offered, subscribed,
acquired, placed or otherwise dealt in should be read as including
any issue or offer to, or subscription, acquisition, placing or
dealing by, RBS Hoare Govett and any of its affiliates acting as
investors for their own accounts. RBS Hoare Govett does not intend
to disclose the extent of any such investment or transactions
otherwise than in accordance with any legal or regulatory
obligations to do so.
This announcement may contain certain forward-looking
statements. Forward-looking statements relate to expectations,
beliefs, projections, future plans and strategies, anticipated
events or trends and similar expressions concerning matters that
are not historical facts. In some cases, forward-looking statements
can be identified by terms such as "anticipate", "believe",
"could", "estimate", "expect", "intend", "may", "plan",
"potential", "should", "will", and "would", or the negative of
those terms or other comparable terminology. The forward-looking
statements are based on the Company's beliefs, assumptions, and
expectations of future performance and market developments, taking
into account all information currently available. These beliefs,
assumptions, and expectations can change as a result of many
possible events or factors, not all of which are known or are
within the Company's control. If a change occurs, the Company's
business, financial condition, liquidity, and results of operations
may vary materially from those expressed in forward-looking
statements. Some of the factors that could cause actual results to
vary from those expressed in forward-looking statements, include,
but are not limited to: the factors described in this announcement;
the rate at which the Company deploys its capital in investments
and achieves expected rates of return; the Company's ability to
execute the Company's investment strategy, including through the
identification of a sufficient number of appropriate investments;
the continuation of CQS Cayman Limited Partnership ("CQS Cayman")
as information service provider to the Company; the continued
affiliation with CQS Cayman of its key investment professionals;
the Company's financial condition and liquidity; changes in the
values of or returns on investments that the Company makes; changes
in financial markets, interest rates or industry, general economic
or political conditions; and the general volatility of the capital
markets and the market price of the Company's shares.
By their nature, forward-looking statements involve known and
unknown risks and uncertainties because they relate to events, and
depend on circumstances that may or may not occur in the future.
Forward-looking statements are not guarantees of future
performance. Any forward-looking statements are only made as at the
date of this announcement, and the Company neither intends nor
assumes any obligation to update forward-looking statements set
forth in this announcement whether as a result of new information,
future events, or otherwise, except as required by law or other
applicable regulation. In light of these risks, uncertainties, and
assumptions, the events described by any such forward-looking
statements might not occur. the Company qualifies any and all of
their forward-looking statements by these cautionary factors.
Please keep this cautionary note in mind while reading this
announcement.
The net asset value figures included in this announcement are
estimates, and are based on unaudited estimated valuations. Final
month-end net asset values may be materially different from these
estimated weekly values, which should only be taken as indicative
values which have been provided for information only and no
reliance should be placed on them. Estimated results, performance
or achievements may differ materially from any actual results,
performance or achievements. Except as required by applicable law
and regulation, the Company expressly disclaims any obligations to
update or revise such estimates to reflect any change in
expectations, new information, subsequent events or otherwise.
It should be noted that past performance is not necessarily
indicative of the future performance of the Placing Shares or the
existing shares of the Company. Further, any indication in this
announcement of the price at which securities of the Company have
been bought or sold in the past cannot be relied upon as a guide to
future performance of the securities of the Company. No statement
in this announcement is intended to be a profit forecast or
dividend forecast.
Before investing, prospective shareholders should consider
carefully the risks attaching to an investment in Placing Shares
and the Company, including the following risks:
-- The Company's ability to diversify its investment risk is
materially dependent on the investments made by DVA and a
concentrated number of Underlying Funds.
-- A material adverse event in relation to DVA or any of the
Underlying Funds may substantially affect the performance of the
Company.
-- The Company is not a party to the investment management
agreement between DVA and CQS or any management agreement or
advisory agreement between an Underlying Fund and its investment
manager and/or advisor.
-- The investments made by the Company are relatively illiquid
and this may limit the ability of the Company to realise its
investments. A material adverse event in relation to DVA, an
Underlying Fund or the markets generally could have the effect of
increasing losses suffered by the Company.
-- The Company may be exposed to systemic risk.
-- The ability of the Company to meet its investment objectives
will depend on CQS' ability to generate positive returns through
DVA.
-- Substantial redemptions by equity holders in DVA or in any
Underlying Fund may cause a liquidation of investments at an
undesirable rate.
-- CQS may, from time to time, be in possession of non-public
information that restricts the ability of DVA to acquire or dispose
of investments.
-- The increasing size and maturity of the hedge fund market may
increase the difficulty in identifying attractive investment
opportunities to which the Company will be indirectly exposed.
-- DVA is entitled to require mandatory redemption of
shareholders' DVA shares and the Underlying Funds are entitled to
redeem DVA's investment in the Underlying Funds.
-- The shares the Company holds in DVA will be non-voting
Shares.
-- The use of leverage by the Underlying Funds may increase the
volatility of returns.
-- There is a risk of counterparty default in relation to
leverage obtained through derivative or synthetic instruments.
-- Any reduction or decline in the availability of credit
facilities and/or liquidity provisions by prime brokers and/or
other counterparties may adversely affect the Underlying Funds' and
the Company's investments and performance.
-- Shareholders may be adversely affected by currency
movement.
-- The Company, DVA and the Underlying Funds may not be able to
realise the value of the investments that they report from time to
time.
-- Investments held by the Underlying Funds may be illiquid and
an inability to realise investments in difficult market conditions
may expose the Company to additional losses.
-- The Company's assets may be invested in a concentrated number
of Underlying Funds which could expose the Company to greater risk
of failure and therefore greater potential losses.
-- Higher portfolio turnover may result in significant
transaction costs.
-- Investments by DVA and the Underlying Funds may not be
regulated by the rules of any stock exchange or investment exchange
and may be subject to the risk of the counterparty failing to
perform its obligations.
-- Investments by the Underlying Funds may be affected by
changes to international agreements and international laws and
failures of authorities to enforce compliance with such laws.
-- The regulatory and tax environment for hedge funds may change
in a disadvantageous way.
-- Shareholders have no right to have their Shares redeemed by
the Company.
-- The existence of a liquid market in the Shares cannot be
guaranteed.
-- The price of the Shares may fluctuate.
-- The Shares in the Company may trade at a discount to Net
Asset Value and Shareholders may be unable to realise their
investments on the market at Net Asset Value.
-- The rights of Shareholders and the fiduciary duties the Board
owes to the Company and Shareholders are governed by Guernsey law
and may differ from the rights and duties that would apply if the
Company were organised under the laws of a different
jurisdiction.
-- The Company is not, and does not intend to become, registered
in the US as an investment company under the Investment Company Act
and related rules. The Shares will be subject to transfer
restrictions in the Issue and in secondary transactions in the
future.
-- If the Company, DVA, or the Underlying Funds in which it
directly or indirectly invests become subject to tax on a net
income basis in any tax jurisdiction, including the United Kingdom,
the Company's financial condition and prospects could be materially
and adversely affected.
-- Changes in taxation legislation, or the rate of taxation, may
adversely affect the Company, DVA or the Underlying Funds and their
respective investment performance.
Appendix
TERMS AND CONDITIONS
IMPORTANT INFORMATION REGARDING THE PLACING FOR INVITED PLACEES
ONLY
Eligible Participants
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING. THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS
DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE EUROPEAN
ECONOMIC AREA WHO ARE QUALIFIED INVESTORS AS DEFINED IN ARTICLE
(2)(1)(e) ("QUALIFIED INVESTORS") OF DIRECTIVE 2003/71/EC, AS
AMENDED; (B) IN THE UNITED KINGDOM, QUALIFIED INVESTORS WHO ARE
ALSO PERSONS (1) WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS
RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(5) (INVESTMENT
PROFESSIONALS) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000
(FINANCIAL PROMOTION) ORDER 2005 (AS AMENDED) (THE "ORDER") OR (2)
FALLING WITHIN ARTICLE 49(2)(a) TO (d) (HIGH NET WORTH COMPANIES,
UNINCORPORATED ASSOCIATIONS, ETC.) OF THE ORDER; AND (C) OTHER
PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH
PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS") AND THE
TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED
ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR
INVESTMENT ACTIVITY TO WHICH THIS APPENDIX AND THE TERMS AND
CONDITIONS SET OUT HEREIN RELATES IS AVAILABLE ONLY TO RELEVANT
PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. NEITHER
THIS APPENDIX NOR THE ANNOUNCEMENT OF WHICH IT FORMS PART
CONSTITUTES AN OFFER OR AN INVITATION TO ACQUIRE OR DISPOSE OF ANY
SECURITIES IN THE COMPANY.
Persons choosing to participate in the Placing by making an oral
or written offer to acquire Placing Shares will be deemed to have
read and understood this Appendix and the announcement of which it
forms part in their entirety and to be making such offer on the
terms and conditions, and to be providing the representations,
warranties and acknowledgements, contained in this Appendix. In
particular each participant will represent, warrant and acknowledge
that it is a Relevant Person. Further, each participant will
represent and agree that it (i) is neither a U.S. Person or person
located in the United States of America, its territories or
possessions, any state of the United States or the District of
Columbia (the "United States") nor acting on behalf of a U.S.
Person or person located in the United States, (ii) is subscribing
for Placing Shares in an "offshore transaction" (within the meaning
of Regulation S ("Regulation S") under the U.S. Securities Act of
1933, as amended (the "Securities Act")) and (iv) will not offer,
sell, resell or deliver, directly or indirectly, any of the Placing
Shares except in offshore transactions in accordance with
Regulation S to a person outside the United States and not known by
the participant to be a U.S. person by pre-arrangement or
otherwise. See "Representations and Warranties" elsewhere in this
Appendix for further representations and warranties that
participants will be deemed to make by participating in the
book-building.
The securities described herein are being offered and sold
outside the United States to persons who are not U.S. Persons in
reliance on Regulation S.
This Appendix and the announcement of which it forms part do not
constitute an offer to sell or the invitation or solicitation of an
offer to buy or subscribe for Shares in the capital of the Company
in the United States, Canada, Australia, Japan or in any
jurisdiction in which such offer or solicitation is unlawful (the
"Restricted Jurisdictions") and the information contained herein is
not for publication or distribution, directly or indirectly, to
persons in any Restricted Jurisdiction or to or for the account or
benefit of any U.S. Persons. In particular, this Appendix and the
announcement of which it forms part are not an offer for sale of
the securities in the United States or to or for the account or
benefit of any U.S. Person, and the securities have not been and
will not be registered under the Securities Act, and may not be
offered, sold, resold or delivered, directly or indirectly, except
in offshore transactions in accordance with Regulation S to a
person outside the United States and not known by the participant
to be a U.S. person by pre-arrangement or otherwise..
Accordingly, the Placing Shares may not (unless an exemption
under the relevant securities laws is applicable) be offered, sold,
resold or delivered, directly or indirectly, in or into the United
States, Canada, Australia, or Japan or to or for the account or
benefit of any U.S. Persons. Any persons who have a contractual or
other legal obligation to forward a copy of this Appendix or the
announcement of which it forms part to a jurisdiction outside the
United Kingdom should seek appropriate advice before taking any
action.
The distribution of this announcement and the placing of the
Placing Shares in certain other jurisdictions may be restricted by
law. No action has been taken by the Company, CQS or the Bookrunner
that would permit an offer of such shares or possession or
distribution of this announcement or any other offering or
publicity material relating to such shares in any jurisdiction
where action for that purpose is required. Persons into whose
possession this announcement comes are required by the Company, CQS
and the Bookrunner to inform themselves about and to observe any
such restrictions.
The Placing and the Placing Shares
RBS Hoare Govett has been appointed as sole bookrunner, placing
agent and corporate broker to the Placing.
Pursuant to the Placing Agreement, the Bookrunner has, on the
terms and conditions set out therein, undertaken as agent for the
Company to use its reasonable endeavours to procure subscribers for
the Placing Shares.
Each Placing Share will be issued credited as fully paid and
will rank pari passu with the Company's existing shares of the same
currency class, including the right to receive all dividends and
other distributions declared, made or paid on or in respect of such
class of shares after the date of issue of the Placing Shares.
Applications
Commencing today, the Bookrunner will be conducting a
book-building process to determine demand for each class of Placing
Shares. This Appendix gives details of the terms and conditions of,
and the mechanics of participation in, the Placing.
The Company will make a further announcement following the close
of the book-building detailing the number of each class of Placing
Shares to be sold and the Placing Price per share for each class of
Placing Shares (the "Pricing Announcement").
Allocations (if any) of Placing Shares will be confirmed orally
following the close of the book-building and contract notes
confirming the agreement to subscribe for Placing Shares will be
dispatched as soon as possible thereafter. The Bookrunner's oral
confirmation will constitute acceptance of an offer to acquire
Placing Shares and create a legally binding commitment to subscribe
for the number of Placing Shares allocated on the terms and
conditions set out in this Appendix and in accordance with the
Company's articles of incorporation.
The Bookrunner will be entitled to effect the Placing by such
alternative method to the book-building process as it, CQS and the
Company may agree. To the fullest extent permissible by law,
neither the Bookrunner nor any of its holding companies,
subsidiaries, branches, affiliates or associated undertakings or
any subsidiary, branch, affiliate or associated undertaking of any
such holding company (each an "Affiliate") shall have any liability
to persons allocated any Placing Shares in the Placing (each a
"Placee") or to any other person whether acting on behalf of a
Placee or otherwise. In particular, none of the Bookrunner nor any
of its Affiliates shall have any liability in respect of its
conduct of the book-building process or of such alternative method
of effecting the Placing as the Bookrunner may determine.
Principal terms of the book-building
1. The Bookrunner is arranging the Placing as agent of the
Company.
2. A single Placing Price for each class of Placing Shares
payable to the Bookrunner by all Placees whose bids are accepted
will be agreed between the Bookrunner and the Company following
completion of the book-building process. The Placing Price will be
determined by reference to the prevailing net asset value and share
price for each class of Placing Shares. In any event, the Placing
Price will not be less than the aggregate of the prevailing
estimated net asset value per share for the relevant class of the
Company's Shares (as contained in the latest weekly net asset value
estimate released by the Company prior to the close of the Placing)
and the expenses of the Placing.
3. The number of each class of Placing Shares to be issued will
be determined by the Company, CQS and the Bookrunner following
completion of the book-building.
4. Bids should be communicated by telephone to a participant's
usual sales contact at RBS. Bids should state the number and class
of Placing Shares which are being offered to be acquired at the
Placing Price which is ultimately established by the Company and
the Bookrunner.
5. The Bookrunner reserves the right not to accept bids or to
accept bids in part rather than in whole and may scale down any
bids for this purpose on such basis as it may determine. The
acceptance and/or scaling back of bids and the allocation of
Placing Shares (if any) shall be determined by the Bookrunner after
consultation with CQS and the Company.
6. The book-building process is expected to close at 3.00 p.m.
on 21 June 2011, but may be closed earlier or later, on that or any
other day, as determined by the Bookrunner, CQS and the Company in
their sole discretion. The Bookrunner may, at its sole discretion,
accept bids that are received after the book-building has
closed.
7. Allocations will be confirmed orally by the Bookrunner as
soon as practicable following the close of the book building. The
Bookrunner's oral confirmation of an allocation will give rise to a
legally binding commitment by the Placee concerned, in favour of
the Bookrunner and the Company, under which it agrees to acquire
the number of Placing Shares allocated to it at the applicable
Placing Price on the terms and subject to the conditions set out in
this Appendix and the Company's memorandum and articles of
association.
8. All bids will be made on the terms and subject to the
conditions in this Appendix and will be legally binding on the
Placee on behalf of which it is made and except with the
Bookrunner's and the Company's consent will not be capable of
variation or revocation after the time at which it submitted. Each
Placee will have an immediate, separate, irrevocable and binding
obligation, owed to the Bookrunner, to pay to the Bookrunner (or as
they may direct) in cleared funds an amount equal to the product of
the Placing Price and the amount of Placing Shares for each class
or classes of Placing Shares that such Placee has agreed to
acquire. Each Placee's obligations will be owed to the Company and
to the Bookrunner.
9. Irrespective of the time at which a Placee's allocation(s)
pursuant to the Placing is/are confirmed, settlement for all
Placing Shares to be acquired pursuant to the Placing will be
required to be made at the same time, on the basis explained below
under "Settlement and Admission".
10. All obligations under the book-building and the Placing will
be subject to fulfilment of the conditions referred to below under
"Conditions of the Placing" and to the Placing not being terminated
on the basis referred to below under "Right to terminate under the
Placing Agreement".
Settlement and Admission
RBS is acting as execution and settlement agent in respect of
the Placing. Placees will be sent a contract note or electronic
confirmation which will confirm the number and class of Placing
Shares allocated to them, the applicable Placing Price, the
aggregate amount owed by them and settlement instructions. If
Placing Shares are to be delivered to a custodian or settlement
agent, Placees must ensure that, upon receipt, the contract note is
copied and delivered immediately to the relevant person within that
organisation.
Placees will only receive Placing Shares subscribed by them in
uncertificated form by registration to their CREST accounts in
consideration of the transfer by them to the RBS account within
CREST of all subscription monies due.
RBS expects (as settlement agent) to input trades into the
relevant settlement system with a trade date of 22 June 2011 for
delivery on 27 June 2011 (T+3).
Placees should match their instructions to RBS CREST participant
ID 521 by no later than the close of business on 24 June 2011.
The ISIN numbers for each class of the Company's ordinary share
capital is as follows:
Share description ISIN code
Sterling Shares of no par value GG00B5B3RG70
US$ Shares of no par value GG00B5WDRR74
Each Placee will be deemed to agree that it will do all things
necessary to ensure that delivery and payment is completed in
accordance with the standing CREST or certificated settlement
instructions which they have in place with the Bookrunner.
In the event of any difficulties or delays in the admission of
the Placing Shares to CREST or the use of CREST in relation to the
Placing, the Company and the Bookrunner may agree that the Placing
Shares should be issued in certificated form. The Bookrunner
reserves the right to require settlement for the Placing Shares,
and to deliver the Placing Shares to Placees, by such other means
as they deem necessary if delivery or settlement to Placees is not
practicable within the CREST systems or would not be consistent
with regulatory requirements in a Placee's jurisdiction.
Settlement of transactions in the Placing Shares following
Admission may take place within the CREST systems.
Interest is chargeable daily on payments not received on the due
date in accordance with the arrangements set out above, in respect
of CREST or certificated deliveries, at the rate of 5 percentage
points above prevailing LIBOR.
If Placees do not comply with their obligations, the Bookrunner
may sell their Placing Shares on their behalf and retain from the
proceeds, for its own account and benefit, an amount equal to the
Placing Price of each share sold plus any interest due. Placees
will, however, remain liable for any shortfall below the Placing
Price and for any stamp duty or stamp duty reserve tax (together
with any interest or penalties) which may arise upon the sale of
their Placing Shares on their behalf.
Placees will not be entitled to receive any fee or commission in
connection with the Placing.
Time shall be of the essence as regards the obligations of
Placees to settle payment for the Placing Shares and to comply with
their other obligations under this Appendix.
The Company will apply for admission of the Placing Shares to
the premium listing segment of the Official List of the Financial
Services Authority and to listing on the London Stock Exchange
plc's market for listed securities. It is expected that settlement
and Admission will take place and that trading will commence in the
Placing Shares on 27 June 2011.
Conditions of the Placing
The obligations of the Bookrunner under the Placing Agreement
are conditional upon, inter alia, (i) agreement between the
Company, CQS Cayman Limited Partnership and the Bookrunner of the
Placing Price and the number of Placing Shares of each class to be
issued pursuant to the Placing, (ii) each of the warranties given
by the Company being true and accurate and not being or becoming
misleading (in each case) by reference to the facts and
circumstances subsisting at any time prior to Admission and no
matter having arisen which in the good faith opinion of the
Bookrunner is likely to give rise to a claim for indemnity under
the Placing Agreement, (iii) Admission occurring no later than 8.00
a.m. on 27 June 2011 or such other time or date as the Company, CQS
and the Bookrunner may agree in writing (not being later than 30
June 2011), and (iv) in the good faith opinion of the Bookrunner,
there shall not have been prior to Admission any material adverse
change (whether or not foreseeable) in, or any development likely
to involve a prospective material adverse change in or affecting,
the condition, financial or otherwise, or the earnings or business
affairs or business prospects of the Company, CQS Diversified Fund
(SPC) Limited, the Existing Underlying Funds taken as a whole or
CQS Cayman Limited Partnership, whether or not arising in the
ordinary course of business.
If (a) the conditions in the Placing Agreement relating to the
Placing are not satisfied or waived by the Bookrunner (in its
absolute discretion) within the stated time period (or such later
time and/or date as the Bookrunner may decide) or (b) the Placing
Agreement is terminated in the circumstances specified below prior
to Admission of the Placing Shares, the Placing will not take place
and the rights and obligations of Placees hereunder in respect
hereof shall cease and determine at such time and no claim can be
made in respect thereof.
By participating in the book-building process, each participant
agrees that its rights and obligations hereunder in relation to the
Placing are conditional upon the Placing Agreement becoming
unconditional in all respects and not being terminated and will
terminate only in the circumstances described above (or otherwise
in circumstances in which the Bookrunner or the Company are
entitled to terminate them and without any liability on the part of
the Bookrunner or the Company for any decision to terminate or not
terminate) and will not be capable of rescission or termination by
that participant.
The Bookrunner reserves the right to waive or to extend the time
and /or date for fulfilment of any of the conditions in the Placing
Agreement. Neither the Bookrunner nor the Company shall have any
liability to any Placee (or to any other person whether acting on
behalf of a Placee or otherwise) and no claim may be made against
the Bookrunner in respect of any decision it may make as to whether
or not to invoke, waive or to extend the time and/or date for the
satisfaction of any condition in the Placing Agreement, and by
participating in the book-building each participant agrees that any
such decision is within the absolute discretion of the Bookrunner
or the Company as the case may be.
Right to terminate under the Placing Agreement
The Bookrunner may terminate the Placing Agreement at any time
if before Admission it shall come to the notice of the Bookrunner
that (inter alia):
(a) there has been a breach or an alleged breach of any of the
warranties or of any other term of the Placing Agreement by the
Company and/or CQS which the Bookrunner in its good faith opinion
considers to be material in the context of the Placing or
Admission; or
(b) there has occurred any adverse change in the financial
markets in the United States, United Kingdom, the European Economic
Area or the international financial markets, any outbreak of
hostilities or escalation thereof, any act of terrorism or war or
other calamity or crisis or any change or development involving a
prospective change in national or international political,
financial or economic conditions, currency exchange rates or
exchange controls, in each case the effect of which is such as to
make it, in the good faith opinion of the Bookrunner, impracticable
or inadvisable to proceed with the Placing in the manner
contemplated by this Agreement or which in the good faith opinion
of the Bookrunner may materially and adversely affect the success
of the Placing or dealings in the Placing Shares following
Admission; or
(c) trading generally on the American Stock Exchange, the New
York Stock Exchange, the NASDAQ National Market or the London Stock
Exchange has been suspended or limited, or minimum or maximum
prices for trading have been fixed, or maximum ranges for prices
have been required, by any of said exchanges or by such system or
by order of the SEC, the National Association of Securities
Dealers, Inc. or any governmental authority, or a material
disruption has occurred in commercial banking or securities
settlement or clearance services in the United States or in the
European Economic Area.
By participating in the Placing, each participant agrees that
the exercise by the Bookrunner or the Company of any right or
termination or other discretion under the Placing Agreement shall
be within the absolute discretion of the Bookrunner or the Company
(as the case may be) and that none of them need make any reference
to any such participant and that none of them shall have any
liability to any participant whatsoever (and no claim may be made
by any participant) in connection with any such exercise).
No Prospectus
The Placing Shares are being offered to Relevant Persons only
and will not be offered in such a way as to require a prospectus in
Guernsey or the United Kingdom or elsewhere. No prospectus has been
or will be submitted to be approved by the Guernsey Financial
Services Commission nor the States of Guernsey Policy Council nor
the FSA in relation to the Placing and each participant's
commitment will be made solely on the basis of the information
contained in this announcement and any Publicly Available
Information (as such term is defined below). Each participant, by
participating in the Placing agrees that the content of this
announcement and the Pricing Announcement is exclusively the
responsibility of the Company, and each participant confirms that
it has neither received nor relied on any other information,
representation, warranty or statement made by or on behalf of the
Bookrunner, the Company or CQS and none of such persons will be
liable for any person's decision to accept this invitation to
participate in the Placing based on any other information,
representation, warranty or statement. Each participant
acknowledges and agrees that 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.
Representations and Warranties
By participating in the book-building, each participant (and any
person acting on its behalf):
1. represents and warrants that it has read and understood this
announcement in its entirety and acknowledges that its
participation in the Placing will be governed by the terms of this
announcement;
2. represents and warrants that it has the power and authority
to subscribe for the Placing Shares to be issued to it under the
Placing and to execute and deliver all documents necessary for such
subscription and the person orally committing to subscribe for the
Placing Shares on its behalf has been duly authorised to do so;
3. agrees to indemnify on an after-tax basis and hold harmless
each of the Company, the Bookrunner, CQS, their respective
Affiliates and any person acting on its 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 document and further agrees that the
provisions of this document shall survive after completion of the
Placing;
4. is able to obtain or access the Publicly Available
Information without undue difficulty;
5. acknowledges that none of the Bookrunner or CQS, nor any of
their respective Affiliates nor any person acting on their behalf
has provided, and will not provide it with any material or
information regarding the Placing Shares or the Company; nor has it
requested the Bookrunner, any of their respective Affiliates nor
any person acting on their behalf to provide it with any such
material or information;
6. represents, warrants and agrees that the only information on
which it is entitled to rely and on which such Placee has relied in
committing to subscribe for the Placing Shares is contained in this
document and any Publicly Available Information, such information
being all that it deems necessary to make an investment decision in
respect of the Placing Shares, and that it has relied on its own
investigation with respect to the Placing Shares and the Company in
connection with its decision to subscribe for the Placing Shares
and acknowledges that it is not relying on any investigation that
the Bookrunner, CQS, any of their respective Affiliates or any
person acting on their behalf may have conducted with respect to
the Placing Shares or the Company and none of such persons has made
any representations to it, express or implied, with respect
thereto;
7. acknowledges that it has not relied on any information
relating to the Company contained in any research reports prepared
by RBS Hoare Govett, or any of its Affiliates or any person acting
on their or any of their respective Affiliates' behalf and
understands that (i) none of RBS Hoare Govett, any of its
Affiliates nor any person acting on their behalf has or shall have
any liability for public information or any representation; (ii)
none of RBS Hoare Govett, any of its Affiliates nor any person
acting on their 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 publication, the date of this
document or otherwise; and that (iii) none of RBS Hoare Govett, any
of its Affiliates nor any person acting on their behalf makes any
representation or warranty, express or implied, as to the truth,
accuracy or completeness of such information, whether at the date
of publication, the date of this document or otherwise;
8. 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, 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, the Bookrunner, any of their respective
Affiliates or any person acting on their behalf being in breach of
the legal and/or regulatory requirements of any territory in
connection with the Placing;
9. represents and warrants that the issue to the Placee, or the
person specified by the Placee for registration as holder, of
Placing Shares will not give rise to a liability under any of
sections 67, 70, 93 or 96 of the Finance Act 1986 (depositary
receipts and clearance services) and that the Placing Shares are
not being acquired in connection with arrangements to issue
depositary receipts or to issue or transfer Placing Shares into a
clearance system;
10. represents and warrants that it understands that the Placing
Shares have not been and will not be registered under the
Securities Act or under the securities laws of any state or other
jurisdiction of the United States and that the Company has not been
registered as an "investment company" under the United States
Investment Company Act of 1940, as amended;
11. represents and warrants that it (a) is, or at the time the
Placing Shares are acquired, it will be, (i) the beneficial owner
of such Placing Shares and is neither a U.S. Person or a person
located in the United States nor acting on behalf of a U.S. Person
or a person located in the United States and (ii) acquiring the
Placing Shares in an offshore transaction (as defined in Regulation
S under the Securities Act), (b) will not offer or sell, directly
or indirectly, any of the Placing Shares except in offshore
transactions in accordance with Regulation S to a person outside
the United States and not known by the participant (or any person
acting on its behalf) to be a U.S. person by pre-arrangement or
otherwise, and (c) is not (i) a "benefit plan investor" (as defined
in 29 C.F.R. -- 2510.3-101, as modified by Section 3(42) of US
Employee Retirement Income Security Act of 1974, as amended
("ERISA")), or acting on behalf of or using the assets of a benefit
plan investor; or (ii) an employee benefit plan subject to any
federal, state, local or other law or regulation that is
substantially similar to the prohibited transaction provisions of
Section 406 of ERISA or Section 4975 of the US Internal Revenue
Code of 1986, as amended (an "Other Plan"), or acting on behalf of
or using the assets of any Other Plan with respect to its
application for the Placing Shares.;
12. represents and warrants that it has not offered or sold and,
prior to the expiry of a period of six months from Admission, will
not offer or sell any Placing Shares to persons in the United
Kingdom except to persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (as
principal or agent) for the purposes of their business or otherwise
in circumstances which have not resulted and which will not result
in an offer to the public in the United Kingdom within the meaning
of section 85(1) FSMA;
13. 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;
14. 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;
15. represents and warrants that it has complied with its
obligations in connection with money laundering and terrorist
financing under the Criminal Justice Act 1993, the Proceeds of
Crime Act 2002, the Terrorism Act 2000, the Anti-terrorism Crime
and Security Act 2001 and the Money Laundering Regulations 2007
(the "Regulations") and, if it is 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;
16. acknowledges that due to anti-money laundering requirements,
the Bookrunner and/or the Company may require proof of identity and
verification of the source of the payment before its application
can be processed and that, in the event of delay or failure by the
participant to produce any information required for verification
purposes, the Bookrunner and/or the Company may refuse to accept
the application and the subscription moneys relating thereto and
agrees and undertakes to hold harmless and indemnify the Bookrunner
and/or, the Company against any liability, loss or cost ensuing due
to the failure to process its application, if such information as
has been required has not been provided by it;
17. acknowledges that any person in Guernsey involved in the
business of the Company who has a suspicion or belief that any
other person (including the Company or any person subscribing for
Placing Shares) is involved in money laundering activities, is
under an obligation to report such suspicion to the Financial
Intelligence Service pursuant to The Criminal Justice (Proceeds of
Crime) (Bailiwick of Guernsey) Law, 1999 (as amended);
18. acknowledges that pursuant to The Data Protection (Bailiwick
of Guernsey) Law, 2001, (the "DP Law") the Company, and/or its
registrar, may hold personal data (as defined in the DP Law)
relating to past and present shareholders and that such personal
data held is used to maintain the Company's register of
shareholders and mailing lists and this may include sharing data
with third parties in one or more countries when (a) effecting the
payment of dividends and redemption proceeds to shareholders and
the payment of commissions to third parties and (b) filing returns
of shareholders and their respective transactions in shares with
statutory bodies and regulatory authorities and consents to the
processing of its personal data for such purposes;
19. represents and warrants that it is (a) a person falling
within Article 19(5) of the Order or (b) a person falling within
Article 49(2)(a) to (d) of the Order 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;
20. represents and warrants that it is a Qualified Investor (as
defined in section 86(7) of FSMA, being a person falling within
Article 2.1(e)(i), (ii) or (iii) of the Prospectus Directive);
21. represents and warrants that if it is a financial
intermediary as that term is used in Article 3(2) of the Prospectus
Directive, the Placing Shares acquired by it in the Placing have
not been acquired on a non-discretionary basis on behalf of, nor
have they been acquired with a view to their offer or resale to,
persons in a member state of the European Economic Area which has
implemented the Prospectus Directive other than (i) Qualified
Investors, or, (ii) in circumstances in which the prior written
consent of RBS Hoare Govett has been given to the offer or
resale;
22. undertakes that it (and any person acting on its behalf)
will pay for the Placing Shares acquired by it in accordance with
this document 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 the
Bookrunner 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 document) which may arise upon the sale of such Placee's
Placing Shares on its behalf;
23. acknowledges that none of the Bookrunner, any of its
respective Affiliates, the Company, CQS nor any person acting on
their 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 neither
the Bookrunner, any of its respective Affiliates, the Company, CQS
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 the Bookrunner's rights and
obligations thereunder, including any right to waive or vary any
condition or exercise any termination right contained therein;
24. 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 the Bookrunner or 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 RBS Hoare Govett which will hold them as
settlement agent as nominee for the Placees 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;
25. acknowledges that any agreements entered into by it pursuant
to these terms and conditions shall be governed by and construed in
accordance with the laws of England 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 English courts as regards any
claim, dispute or matter arising out of any such contract;
26. acknowledges that it irrevocably appoints any director of
the Bookrunner 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;
27. represents and warrants that it is not a U.S. person or a
person located in the United States or a resident of Canada,
Australia or Japan and acknowledges that the Placing Shares have
not been and will not be registered nor will a prospectus be
cleared or passported in respect of the Placing Shares under the
securities legislation of the United States, Canada, Australia or
Japan and, subject to certain exceptions, may not be offered, sold,
taken up, renounced, delivered or transferred, directly or
indirectly, within the United States, Canada, Australia or
Japan;
28. represents and warrants that any person who confirms to RBS
Hoare Govett on behalf of a Placee an agreement to subscribe for
Placing Shares and/or who authorises RBS Hoare Govett to notify the
Placee's name to the Company's registrar, has authority to do so on
behalf of the Placee;
29. 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 the Bookrunner will be
responsible. If this is the case, the Placee should take its own
advice and notify RBS Hoare Govett accordingly;
30. acknowledges that the Placing Shares will be issued and/or
transferred subject to the terms and conditions set out in this
document and in accordance with the Company's memorandum and
articles of association;
31. acknowledges that when a Placee or any person acting on
behalf of the Placee is dealing with RBS Hoare Govett any money
held in an account with RBS Hoare Govett 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 FSA and GFSC. 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 RBS Hoare Govett money in accordance with the
client money rules and will be used by RBS Hoare Govett in the
course of its business; and the Placee will rank only as a general
creditor of RBS Hoare Govett;
32. acknowledges and understands that the Company, the
Bookrunner and others will rely upon the truth and accuracy of the
foregoing representations, warranties, agreements, undertakings and
acknowledgements;
33. acknowledges that until 40 days after the later of the
commencement of the Placing and the closing date, an offer or sale
of Placing Shares within the United States by any dealer (whether
or not participating in the Placing) may violate the registration
requirements of the Securities Act; and
34. acknowledges that the basis of allocation will be determined
by the Bookrunner (after consulting with the Company and CQS) in
its absolute discretion. The right is reserved to reject in whole
or in part and/or scale back any participation in the Placing.
General
This Appendix and the announcement of which it forms part have
been issued by the Company and are the sole responsibility of the
Company.
RBS Hoare Govett, which is authorised and regulated in the
United Kingdom by the Financial Services Authority, is acting
exclusively 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 clients of RBS
Hoare Govett nor for providing advice to any other person in
relation to the Placing or any other matters referred to in this
announcement.
Each participant in the Placing and any person acting on behalf
of such participant acknowledges that the Bookrunner does not owe
fiduciary or other duties to any person in respect of any
representations, warranties, undertakings or indemnities in the
Placing Agreement and that such representations, warranties,
undertakings and indemnities are not given for the benefit of any
Placee.
Each participant in the Placing and any person acting on behalf
of such participant acknowledges and agrees that the Bookrunner may
(at its absolute discretion) satisfy its obligation to procure
Placees by themselves agreeing to become a Placee in respect of
some or all of the Placing Shares or by nominating any connected or
associated person to do so.
When a Placee or any person acting on behalf of the Placee is
dealing with the Bookrunner, any money held in an account with the
Bookrunner 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 Financial
Services Authority and GFSC which therefore will not require the
Bookrunner to segregate such money, as that money will be held by
it under a banking relationship and not as trustee.
The net asset value figures included in this announcement are
estimates, and are based on unaudited estimated valuations. Final
month-end net asset values may be materially different from these
estimated weekly values, which should only be taken as indicative
values which have been provided for information only and no
reliance should be placed on them. Estimated results, performance
or achievements may differ materially from any actual results,
performance or achievements. Except as required by applicable law
and regulation, the Company expressly disclaims any obligations to
update or revise such estimates to reflect any change in
expectations, new information, subsequent events or otherwise.
It should be noted that past performance is not necessarily
indicative of the future performance of the Placing Shares or the
existing shares of the Company. Further, any indication in this
announcement of the price at which securities of the Company have
been bought or sold in the past cannot be relied upon as a guide to
future performance of the securities of the Company. No statement
in this announcement is intended to be a profit forecast or
dividend forecast. Persons needing advice should consult an
independent financial adviser.
All times and dates in this announcement may be subject to
amendment. The Bookrunner will notify Placees and any persons
acting on behalf of Placees of any changes.
This announcement and the information contained herein is not
for distribution directly or indirectly in or into the United
States, Canada, Australia, Japan or to or for the account or
benefit of any U.S. Persons. This announcement does not constitute
an offer to sell or issue or the solicitation of an offer to buy or
acquire Shares in the capital of the Company in the United States,
Canada, Australia, Japan or to or for the account or benefit of any
U.S. Persons or in any jurisdiction in which such an offer or
solicitation is unlawful. The Placing Shares have not been, nor
will they be, registered under the Securities Act or with any
securities regulatory authority of any State or other jurisdiction
of the United States, and accordingly may not be offered, sold or
transferred except in offshore transactions in accordance with
Regulation S to a person outside the United States and not known by
the participant (or any person acting on its behalf) to be a U.S.
person by pre-arrangement or otherwise. No public offering of the
Placing Shares will be made in the United States or any other
jurisdiction. The Company has not, and will not be, registered
under the Investment Company Act and investors will not be entitled
to the benefits of the Investment Company Act.
Definitions
In this announcement:
"Admission" means the admission of the Placing Shares to the
premium listing segment of the Official List in accordance with the
Listing Rules and to trading on the London Stock Exchange plc's
main market for listed securities
"Company" means CQS Diversified Fund Limited
"CQS" means each or any of CQS Cayman Limited Partnership, CQS
(UK) LLP, CQS (Hong Kong) Limited and CQS (US), LLC as the context
requires
"CQS ABS Feeder" means CQS ABS Feeder Fund Limited
"CQS Convertible and Quantitative Strategies Feeder" means CQS
Convertible and Quantitative Strategies Feeder Fund Limited
"CQS Credit Long Short Feeder" means CQS Credit Long Short
Feeder Fund Limited
"CQS Directional Opportunities Feeder" means CQS Directional
Opportunities Feeder Fund Limited
"CQS Asia Feeder" means CQS Asia Feeder Fund Limited
"Disclosure and Transparency Rules" means the disclosure rules
and transparency rules made by the UKLA, as from time to time
amended
"DVA" means the Segregated Portfolio Alpha of CQS Diversified
Fund (SPC) Limited, a segregated portfolio company incorporated
with limited liability under the laws of the Cayman Islands under
registration number 176824
"ERISA" means the United States Employee Retirement Income
Security Act of 1974, as amended
"Existing Underlying Funds" means CQS Convertible and
Quantitative Strategies Feeder, CQS Directional Opportunities
Feeder, CQS ABS Feeder, CQS Asia Feeder, CQS Credit Long Short
Feeder (and shall refer to both master and feeder vehicles, as the
context requires)
"FSA" means the Financial Services Authority
"FSMA" means the Financial Services and Markets Act 2000, as
amended
"GFSC" means the Guernsey Financial Services Commission
"RBS Hoare Govett" means RBS Hoare Govett Limited
"Investment Company Act" means the United States Investment
Company Act of 1940, as amended
"Listing Rules" means the listing rules made by the UKLA, as
from time to time amended
"London Stock Exchange" means London Stock Exchange plc
"Net Asset Value" or "NAV" the total assets of the Company less
its total liabilities (including accrued but unpaid fees) or, where
relevant, the total assets attributable to a class of Shares less
the total liabilities attributable to that class of Shares
(including the relevant proportion of accrued but unpaid fees) in
each case valued in accordance with the Company's accounting
policies adopted by the Company from time to time and expressed in
Sterling
"New Sterling Shares" means the new ordinary shares denominated
in Sterling of no par value in the capital of the Company to be
issued as Sterling Shares pursuant to the Placing
"New US$ Shares" means the new ordinary shares denominated in US
Dollars of no par value in the capital of the Company to issued as
US$ Shares pursuant to the Placing
"Official List" means the official list of the UKLA
"Order" means the Financial Services and Markets Act 2000
(Financial Promotion) Order 2005 (as amended)
"Placees" means certain professional and institutional investors
whose applications for Placing Shares are accepted by the
Bookrunner and "Placee" means any one of them
"Placing" means the placing of the Placing Shares
"Placing Agreement" means the agreement entered into by the
Company, CQS and the Bookrunner on 21 June 2011 in relation to the
Placing
"Placing Price" means the price per share for the issue of each
class of Placing Shares as determined through the book-building
process and announced in the Pricing Announcement
"Placing Shares" means the New Sterling Shares and the New US$
Shares to be issued pursuant to the Placing, the number and price
of which being specified in the Pricing Announcement
"Pricing Announcement" means the press announcement giving the
results of the book-building and the price per share and total
number of each class of Placing Shares to be issued
"Publicly Available Information" means this announcement, the
Pricing Announcement, any other information publicly announced to a
Regulatory Information Service by or on behalf of the Company prior
to the date of this announcement
"Regulation S" means Regulation S under the Securities Act
"Regulatory Information Service" means any of the regulatory
information services included within the list maintained on the
London Stock Exchange's website
"Relevant Person" means: (a) persons in member states of the
European Economic Area who are qualified investors as defined in
Article (2)(i)(e) ("qualified investors") of Directive 2003/71/EC;
(b) in the United Kingdom, qualified investors who also are persons
(1) who have professional experience in matters relating to
investments falling within Article 19(5) (investment professionals)
of the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005 (as amended) (the "Order") or (2) falling
within Article 49(2)(a) to (d) (high net worth companies,
incorporated associations, etc.) of the Order; and (c) other
persons to whom this announcement may otherwise lawfully be
communicated
"Restricted Jurisdictions" means any jurisdiction in which the
offer or solicitation of an offer to buy or subscribe for shares in
the capital of the Company is unlawful
"Securities Act" means the United States Securities Act of 1933,
as amended
"Shares" means the Sterling Shares and the US$ Shares or, if the
context specifically requires, the Sterling Shares and/or the US$
Shares
"Sterling Shares" means ordinary shares denominated in Sterling
of no par value in the capital of the Company
"UKLA" means the FSA as the competent authority for listing in
the United Kingdom or any successor body which may be designated
for such purposes
"Underlying Fund" means any collective investment scheme or
similar pooled investment vehicle in which DVA holds units or
shares from time to time (and where such underlying fund is
established as a master/feeder structure, shall refer to both
master and feeder vehicles, as the context requires)
"United States" or "U.S." means the United States of America,
its territories and possessions, any State of the United States and
the District of Columbia
"US$ Shares" means ordinary shares denominated in US Dollars of
no par value in the capital of the Company
"U.S. Person" has the meaning given such term as defined in and
in accordance with Regulation S
This information is provided by RNS
The company news service from the London Stock Exchange
END
IOELFFLIRRIIFIL
Cqs Div Fnd. $ (LSE:CQSU)
Historical Stock Chart
From Jul 2024 to Jul 2024
Cqs Div Fnd. $ (LSE:CQSU)
Historical Stock Chart
From Jul 2023 to Jul 2024
