Investment Policy

The Company’s investment objective and investment policy (including defined terms) are as set out in its prospectus dated 31 August 2023.

Investment objective

The investment objective of the Company is to provide Shareholders with attractive long-term capital growth primarily through the active management of a focused portfolio of quoted companies that have the majority of their operations in, or revenue derived from, Japan, or a majority of whose consolidated net assets are held in Japan, or that are included in the TOPIX, and that have been identified by the Investment Adviser as being undervalued.

Investment policy

Asset allocation

The Company will primarily invest in a highly selective portfolio of shares issued by quoted companies that have the majority of their operations in, or revenue derived from Japan or a majority of whose consolidated net assets are held in Japan, or that are included in the TOPIX (“Japanese Shares”), and which the Investment Adviser deems attractive and undervalued and typically where (i) cash and other liquid investments, real estate and/or tradeable securities constitutes a significant proportion of the investee company’s market capitalisation; and (ii) the relevant company has no controlling or majority shareholders.

The Company may also from time to time obtain exposure to Japanese Shares, Derivatives (as defined below), cash, cash equivalents, exchange traded funds, near cash instruments and money market instruments, which may not necessarily suit activist management by the Investment Adviser, though this will be opportunistic, including as part of an acquisition of a broader portfolio, and will not form a core focus for asset allocation on an ongoing basis.

There are no restrictions placed on the market capitalisation of investee companies; but it is expected that the portfolio will be weighted towards small-cap and mid-cap companies with market capitalisation of up to US$3 billion. The portfolio is expected to have up to 35 holdings, although there is no guarantee that this will be the case, and it may contain a lesser or greater number of holdings at any time.

The Company intends to acquire meaningful minority stakes in each investee company. The Company will not, however, acquire any stake which could cause a change in its status as an investment trust under Chapter 4 of Part 24 of the Corporation Tax Act 2010.

The Board will not set any limits on sector weightings or stock selection within the portfolio. The Company will not be constrained by any index benchmark in its asset allocation.

The Company may use derivatives for efficient portfolio management purposes. Such purposes would include the management of cash received by the Company upon the occurrence of significant liquidity events (including, without limitation, the receipt of proceeds of fundraisings, the realisation of Portfolio assets and other cash-generative events such as the completion of a management buyout by an investee company). Such derivative contracts may, for example, give the Company exposure to the whole or a sub-section of the Japanese stock market until such time as the Investment Adviser determines that the Company’s derivative position should be liquidated and invested in an investee company in accordance with the Investment Policy (the foregoing derivative contracts being, for the purposes of this Investment Policy “Derivatives”).

Additionally, while the Company intends that the majority of its investments will be in quoted companies, it may also make investments in unquoted companies and the Company may become invested in unquoted companies as a result of corporate actions or commercial transactions undertaken by quoted companies. The Company will only make investments in unquoted companies in order to maintain or improve its position in relation to a business which operated through a quoted entity at the time of the Company’s initial investment in that business.

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The information on this website is for information purposes only and does not constitute or form a part of any offer or invitation to sell or issue, or the solicitation of any offer to purchase or subscribe for, securities. Any subscription for securities in the Company may be made only pursuant to the prospectus that provides detailed information about the Company and the securities to be offered (the “Prospectus“). Particular attention should be paid to the “risk factors” section of the Prospectus which highlights specific risks relating to the Company.

The information on this website is based on information which is otherwise publicly available and, whilst the Company uses all reasonable efforts to ensure the information on this website is accurate and up to date, no representations or warranties are given as to the reliability, accuracy or completeness of the information on this website. The Company accepts no liability for any loss or damage which may arise directly or indirectly from any use of or reliance on such information. To the maximum extent permitted by law, the Company excludes all warranties, conditions, terms, undertakings, and representations (excepting fraudulent misrepresentation) of any kind, express or implied, statutory or otherwise in connection with the Company’s website and the materials contained therein. Nothing in these terms and conditions shall be taken to limit or exclude any liability which may not otherwise be limited or excluded under applicable law.

As some of the Company’s investments may be unquoted, net asset value figures in relation to the Company may be based wholly or partly on estimates of the values of the Company’s investments, which estimates may themselves have been subject to no verification or auditing process or may relate to a valuation at a date before the relevant net asset valuation for the Company, or which have otherwise been estimated by the Company’s advisers. Other information on this website may be historic and/or may no longer be of relevance. The Company reserves the right to add to, modify or delete any information on this site at any time.

Reference in this website or the materials therein to any hypertext link, product, process or service does not imply the Company’s support for, or endorsement or recommendation of the provider thereof or the product, process, or service to which reference is made. This website may contain hypertext links to other websites, resources, or other third parties. The Company is not responsible for the availability of, and accepts no liability in relation to, these external websites or their contents. The Company is not a sponsor, partner, promoter, or publisher of any such website.

Information contained in this website which relates to the net asset value performance of the Company may not be indicative of how the Company’s investments may perform in the future. The information on the pages that follow may contain forward-looking statements. Any statement other than a statement of historical fact is a forward-looking statement. Actual results may differ materially from those expressed or implied by any forward-looking statement. Moreover the values of such investments may fluctuate considerably and the historic net asset values shown for the Company take no account of the costs or practical difficulties of realising some or all of such investments. The value of investments offered through or mentioned in the site may go down as well as up and investors may not get back the amount invested. No assurance can be given that the investment objective will be achieved. Information on past performance, where given, is not necessarily a guide to future performance. Changes in rates of exchange between currencies may cause the value of investments to decrease or increase. The information on the site is provided solely for information and does not constitute investment advice or personal investment recommendations. Investments offered through or mentioned in the site may not be suitable for all recipients and in each case potential investors are advised not to take any investment decision unless they have taken independent advice from an advisor authorised under FSMA.

As a result of the Financial Conduct Authority (“FCA“) rules determining which investment products can be promoted to retail investors, certain investment products are classified as “non-mainstream pooled investment products” and face restrictions on their promotion to retail investors. The Company has concluded that the distribution of its shares, being shares in an investment trust, is not restricted as a result of the FCA rules described above. The Company currently conducts its affairs so that the shares issued by the Company can be recommended by financial advisers to retail investors and intends to continue to do so for the foreseeable future.

No securities of the Company have been or will be registered under the US Securities Act of 1933, as amended (the “Securities Act“) or under the securities laws of any state or other jurisdiction of the United States and may not be offered, sold or delivered, directly or indirectly, in or into the United States, or to or for the account or benefit of any US person (within the meaning of Regulation S under the Securities Act) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. In addition, the Company has not been, and will not be, registered under the United States Investment Company Act of 1940, as amended. There will be no public offer of securities in the United States.

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Basis of access

Access to this website is for information purposes only. Any person seeking access to this website represents and warrants to the Company, FundRock and RSM that they are doing so for information purposes only. Making this website available does not constitute an offer to issue or sell or the solicitation of an offer to subscribe for or buy securities in the Company. Further, it does not constitute a recommendation by the Company, FundRock , RSM or any associated company or any other person to subscribe for or buy securities in the Company. The information on this website is general in nature and does not in any way constitute investment, tax, legal or other advice.

None of the Company, FundRock, RSM or any other person has, or accepts, any responsibility or duty to update any information, document or announcement contained on this website and the Company reserves the right to add to, remove or amend any information available on this website at any time.

Shore Capital Stockbrokers Limited (“Shore Capital“), which is authorised and regulated by the Financial Conduct Authority (FCA number 1446629), is acting exclusively for the Company and no-one else in connection with the Placing Programme as defined and described in the Prospectus. Shore Capital will not be responsible to anyone other than the Company for providing the protections afforded to clients of Shore Capital or for providing advice in relation to the Placing Programme.

Joh. Berenberg, Gossler & Co. KG, London Branch (“Berenberg“) which is authorised by the German Federal Financial Authority (BaFin) and which is authorised and regulated by the Financial Conduct Authority (FCA number 959302), is acting exclusively for the Company and no-one else in connection with the Schemes and the Placing Programme as defined and described in the Prospectus. Berenberg will not be responsible to anyone other than the Company for providing the protections afforded to clients of Berenberg or for providing advice in relation to the Schemes, the Placing Programme or the other arrangements described in the Prospectus.

Apart from the responsibilities and liabilities, if any, which may be imposed on Shore Capital or Berenberg by the Financial Services and Markets Act 2000, as amended, or the regulatory regime established thereunder, neither Shore Capital nor Berenberg accepts any responsibility whatsoever for the contents of this website or the Prospectus or for any statement made or purported to be made by it, or on its behalf, in connection with the Company, the Schemes, the Placing Programme or any other transaction or arrangement referred to in the Prospectus. Each of Shore Capital and Berenberg accordingly disclaims all and any liability whether arising in tort, contract or otherwise (save as referred to above) which they might otherwise have in respect of such material or any such statement.

The information on this website is general in nature and may be subject to amendment and updating without notice. None of the Company, FundRock RSM nor any other person guarantees the accuracy or completeness of any information on this website and each such person disclaims all representations and warranties, whether express or implied, to the greatest extent permitted by applicable law and regulation. By continuing to use this website, you agree to the exclusion by such persons, to the greatest extent permitted by applicable law and regulation, of any and all liability for any direct, indirect, punitive, consequential, incidental, special or other damages, including, without limitation, loss of profits, revenue or data arising out of or relating to the provision of and your use of this website and its content.

Neither the Company, its directors, FundRock, RSM nor any other person accepts any responsibility in respect of any information contained on any other website which may be linked to or from this website.

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