THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt about the contents of this document or as to the action you should take, you are recommended immediately to seek your own independent financial advice from your stockbroker, bank manager, solicitor, accountant or other appropriately qualified independent financial adviser authorised under the Financial Services and Markets Act 2000 (as amended) or, if you are in a country outside the United Kingdom, another appropriately authorised independent financial adviser.

If you were a Shareholder and have sold or otherwise transferred all your Shares, please send this document (but not the accompanying personalised Form of Proxy or any accompanying personalised Tender Form) as soon as possible to the purchaser or transferee or to the stockbroker, bank or other agent through whom the sale or transfer was effected for onward transmission to the purchaser or transferee. However, neither this document nor any accompanying document(s) should be forwarded or transmitted to or in any jurisdiction outside the United Kingdom where to do so may violate any legal or regulatory requirement. If you are an existing holder of Shares and you have sold or transferred part only of your registered holding of Shares, please contact the stockbroker, bank or other agent through whom the sale or transfer was effected.

Cavendish Capital Markets Limited ("Cavendish"), which is authorised and regulated in the United Kingdom by the FCA, is acting exclusively for the Company and is not advising any other person or treating any other person as its client in relation to the proposals or the matters referred to in this document and will not be responsible to anyone other than the Company for providing the protections afforded to customers of Cavendish nor for providing advice in relation to the Tender Offer or the matters referred to in this document. Nothing in this paragraph shall serve to exclude or limit any responsibilities which Cavendish may have under the FSMA or the regulatory regime established thereunder.

Apart from the responsibilities and liabilities, if any, which may be imposed on Cavendish by the FSMA or the regulatory regime established thereunder, Cavendish accepts no responsibility whatsoever for the contents of this document or for any other statement made or purported to be made by it or on its behalf in connection with the Company or the Tender Offer. Cavendish accordingly disclaims all and any liability whether arising in tort or contract or otherwise (save as referred to above) which it might otherwise have in respect of this document or any such statement. Cavendish has given and not withdrawn its written consent to the inclusion of its letter in Part 2 hereof and to the references to its name in the form and context in which it is included in this document.

MONTANARO EUROPEAN SMALLER COMPANIES TRUST PLC

(Incorporated and registered in Scotland with registered number SC074677. An investment company within the meaning of Section 833 of the Companies Act 2006)

TENDER OFFER TO PURCHASE UP TO 5% OF THE ISSUED SHARE CAPITAL OF THE COMPANY

APPROVAL OF THE BUY BACK AUTHORITY

AND

NOTICE OF GENERAL MEETING

Tender Offer

The Tender Offer will close at 13:00 hours on 19 November 2025. Eligible Shareholders who wish to participate in the Tender Offer and hold their Shares in certificated form should complete the enclosed Tender Form in accordance with the instructions set out thereon and return the completed Tender Form together with their valid share certificate or other documents of title, to Equiniti Limited, Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA to arrive as soon as possible and, in any event, by no later than 13:00 hours on 19 November 2025.

Eligible Shareholders who wish to participate in the Tender Offer and hold their Shares in uncertificated form (i.e. in CREST) should tender electronically through CREST so that the TTE Instruction settles by no later than 13:00 hours on 19 November 2025, as further described in paragraph 3 of Part 4 of this document.

SHAREHOLDERS WHO DO NOT WISH TO TENDER THEIR SHARES IN THE COMPANY SHOULD NOT COMPLETE OR RETURN A TENDER FORM OR SUBMIT A TTE INSTRUCTION IN CREST.

General Meeting

Notice of a General Meeting of Montanaro European Smaller Companies Trust plc to be held at the offices of Juniper Partners Limited at 28 Walker Street, Edinburgh, EH3 7HR at 10:00 hours on 19 November 2025 is set out at the end of this document. The completion of the Tender Offer described in this document is conditional upon Shareholder approval of the Resolution at the General Meeting.

Shareholders are requested to complete and return the Form of Proxy accompanying this document for use at the General Meeting. To be valid, Forms of Proxy must be completed and returned in accordance with the instruction printed thereon as soon as possible and in any case so as to arrive by no later than 10:00 hours on 17 November 2025. The Form of Proxy can be returned by delivery to Equiniti Limited, Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA, by completing it online at www.shareview.co.uk, or in the case of CREST members, by utilising the CREST electronic proxy appointment service in accordance with the procedures set out in the Notice of General Meeting and the CREST Manual on the Euroclear website (www.euroclear.com). If you are an institutional investor you may also be able to appoint a proxy electronically via the Proxymity platform, a process which has been agreed by the Company and approved by the Registrar. For further information regarding Proxymity, please go to www.proxymity.io and refer to the procedures set out in the Notice of General Meeting. Completion and submission of a proxy appointment will not preclude Shareholders from attending and voting at the General Meeting should they choose to do so. Further instructions relating to the Form of Proxy are set out in the Notice of General Meeting and the Form of Proxy.

All references to times in this document are to London time (GMT) unless stated otherwise.

		Page
	NOTICE FOR US SHAREHOLDERS	4
	EXPECTED TIMETABLE OF PRINCIPAL EVENTS	5
PART 1	LETTER FROM THE CHAIRMAN	6
PART 2	LETTER FROM CAVENDISH CAPITAL MARKETS LIMITED	12
PART 3	FURTHER INFORMATION ON THE TENDER OFFER	15
PART 4	TERMS AND CONDITIONS OF THE TENDER OFFER	16
PART 5	RISK FACTORS	28
PART 6	UK TAXATION IN RELATION TO THE TENDER OFFER	30
PART 7	ADDITIONAL INFORMATION	31
PART 8	DEFINITIONS	32
NOTICE OF GENERAL MEETING

NOTICE FOR US SHAREHOLDERS

The Tender Offer relates to securities in a non-US company registered in Scotland with a listing on the London Stock Exchange and is subject to the disclosure requirements, rules and practices applicable to companies listed in the United Kingdom, which differ from those of the United States in certain material respects. This document has been prepared in accordance with UK style and practice for the purpose of complying with the laws of Scotland, the UK Listing Rules and the rules of the London Stock Exchange. US Shareholders should read this entire document. Any financial information relating to the Company has been prepared in accordance with UK-adopted international accounting standards and has not been prepared in accordance with generally accepted accounting principles in the United States; thus it may not be comparable to financial information relating to US companies. The Tender Offer is being made in the United States pursuant to Section 14(e) of, and Regulation 14E under, the US Securities Exchange Act of 1934 as amended (the "Exchange Act"), subject to the exemptions provided by Rule 14d-1(d) thereunder and otherwise in accordance with the requirements of the UK Listing Rules. Accordingly, the Tender Offer will be subject to disclosure and other procedural requirements that are different from those applicable under US domestic tender offer procedures. US Shareholders should note that the Company is not listed on a US securities exchange, subject to the periodic reporting requirements of the Exchange Act or required to, and does not, file any reports with the SEC thereunder. Tenders from the United States will be accepted only from Qualifying US Shareholders.

It may be difficult for US Shareholders to enforce certain rights and claims arising in connection with the Tender Offer under US federal securities laws since the Company is located outside the United States and its officers and directors reside outside the United States. It may not be possible to sue a non-US company or its officers or directors in a non-US court for violations of US securities laws. It also may not be possible to compel a non-US company or its affiliates to subject themselves to a US court's judgment.

To the extent permitted by applicable law and in accordance with normal UK practice, the Company, Cavendish, or any of their affiliates may make certain purchases of, or arrangements to purchase, Shares outside the United States during the period in which the Tender Offer remains open for acceptance, including sales and purchases of Shares effected by Cavendish acting as market maker in the Shares. These purchases, or other arrangements, may occur either in the open market at prevailing prices or in private transactions at negotiated prices. In order to be excepted from the requirements of Rule 14e-5 under the Exchange Act, by virtue of relief granted by the SEC Rule 14e-5(b)(12) thereunder, such purchases, or arrangements to purchase, must comply with applicable Scottish and English law and regulation, including the UK Listing Rules, and the relevant provision of the Exchange Act. Any information about such purchases will be disclosed as required in the United Kingdom and the United States and, if required, will be reported via the Regulatory Information Service of the London Stock Exchange and available on the London Stock Exchange website at www.londonstockexchange.com. To the extent that such information is made public in the United Kingdom, this information will also be publicly available to Shareholders in the United States.

The receipt of cash pursuant to the Tender Offer may be a taxable transaction for US federal income tax purposes. Each US Shareholder should consult and seek individual tax advice from an appropriate professional adviser.

Cavendish has engaged Beech Hill Securities, Inc. to act as its chaperone pursuant to Rule 15a-6 under the Exchange Act in connection with securities transactions effected by Cavendish with Qualifying US Shareholders. Beech Hill Securities, Inc. is a US broker-dealer registered with the SEC and is a member of FINRA with its principal place of business at 880 Third Avenue, New York, NY 10022.

Neither the SEC nor any US state securities commission has approved or disapproved of this transaction or passed upon the merits or fairness of such transaction or passed upon the adequacy of the information contained in this document. Any representation to the contrary is a criminal offence.

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

Tender Offer opens: announcement of the Tender Offer and publication of this document	20 October 2025
Publication of half-yearly results and announcement of the Dividends	31 October 2025
Latest time and date for receipt of Forms of Proxy or transmission of CREST Proxy Instructions, Proximity or any other electronic voting instructions for the General Meeting	10:00 hours on 17 November 2025
Time and date of General Meeting	10:00 hours on 19 November 2025
Announcement of the result of General Meeting	19 November 2025
Tender Closing Date: last time and date for receipt of Tender Forms and share certificates for certificated Shares and TTE Instruction(s) in CREST for uncertificated Shares	13:00 hours on 19 November 2025
Tender Record Date	18:00 hours on 19 November 2025
Announcement of number of Shares validly tendered	21 November 2025
CREST accounts credited with unsuccessfully tendered uncertificated Shares	not later than 24 November 2025
Calculation Date for the Tender Price	28 November 2025
Announcement of the Tender Price	1 December 2025
Purchase of Shares under the Tender Offer	3 December 2025
Ex-dividend date for the Dividends	4 December 2025
CREST accounts credited in respect of Tender Offer proceeds for uncertificated Shares	by 5 December 2025
Record date for the Dividends	18:00 hours on 5 December 2025
Cheques despatched in respect of Tender Offer proceeds for certificated Shares	by 15 December 2025
Despatch of share certificates to be returned in respect of unsuccessfully tendered certificated Shares	by 15 December 2025
Despatch of balancing share certificates for revised, certificated holdings in the case of partially successful tenders	by 15 December 2025
Payment date for the Dividends	5 January 2026

The times and dates set out in the expected timetable and mentioned throughout this document may, in certain circumstances, be adjusted by the Board, in which event, details of the new times and dates will be notified, as required, to the London Stock Exchange and, where appropriate, to Shareholders and an announcement will be made through a Regulatory Information Service.

All references to times in this document are to London time (GMT) unless otherwise stated.

PART 1 LETTER FROM THE CHAIRMAN

MONTANARO EUROPEAN SMALLER COMPANIES TRUST PLC

(Incorporated and registered in Scotland with registered number SC074677. An investment company within the meaning of Section 833 of the Companies Act 2006)

Directors: Registered Office: Richard Curling (Chairman) 28 Walker Street Caroline Roxburgh Edinburgh Gordon Neilly EH3 7HR Hillary Williams

20 October 2025

Dear Shareholder

Tender Offer to purchase up to 5% of the issued share capital of the Company, approval of the buy back authority for the Tender Offer and the Subsequent Tender Offer and notice of general meeting

1 INTRODUCTION

1.1 As announced by the Company on 27 March 2025, the Board is proposing to offer Shareholders the opportunity to tender their Shares to the Company twice a year around the time of the interim and final results publication (the "Biannual Tender Offer Facility"). The Tender Price has been set at a 5% discount to the prevailing Net Asset Value per Share as at the Calculation Date. This reflects the wider spreads amongst smaller companies and the cost associated with the exercise, allowing Shareholders who wish to realise a portion of their holding to do so at a price close to NAV whilst potentially providing for a modest uplift to Net Asset Value per Share for continuing Shareholders.
1.2 The purpose of this document is to set out the terms and conditions of the first such periodic Tender Offer, with details of how Shareholders can tender Shares for purchase if they wish to do so and certain information required to be disclosed pursuant to the UK Listing Rule.
1.3 The purpose of this document is also to convene the General Meeting at which the appropriate Shareholder authority for the Tender Offer (and the Subsequent Tender Offer (as defined below)) will be sought. The General Meeting will be held at 10:00 hours on 19 November 2025 at the offices of Juniper Partners Limited at 28 Walker Street, Edinburgh, EH3 7HR, notice of which is set out at the end of this document. The implementation of the Tender Offer is therefore conditional on, amongst other things, the Resolution being passed.

2 BACKGROUND TO THE PROPOSALS

2.1 In March 2025, the Board announced three strategic initiatives designed to strengthen the investment proposition and deliver value for all Shareholders: (a) an active share buy back policy aimed at reducing the volatility of the discount to which the Shares were trading; (b) regular tender offers targeted at improving liquidity; and (c) reduced management fees.
2.2 In considering these initiatives and the Biannual Tender Offer Facility, the Board was conscious of Shareholders' desire to improve the liquidity of the Shares whilst remaining cognisant of the liquidity constraints of the Company's underlying portfolio.
2.3 In order to protect existing Shareholders and facilitate liquidity management in the underlying portfolio, the Tender Offer will be limited to a maximum of 5% of the Shares in issue at the Latest Practicable Date. The Subsequent Tender Offer (as defined below) will similarly be limited to a maximum of 5% of the Shares in issue at the relevant latest practicable date prior to the publication of the shareholder circular for such Subsequent Tender Offer. It is hoped that these regular tender opportunities will improve liquidity for all Shareholders.
2.4 The Tender Offer, which represents the first such periodic tender offer, is being made for up to 7,409,587 Shares at a Tender Price equal to a 5% discount to the prevailing Net Asset Value per Share as at the Calculation Date. Completion of the Tender Offer is expected to take place on 3 December 2025.
2.5 The Board intends to announce details of the second tender offer of the current financial year in or around May 2026 (the "Subsequent Tender Offer"), with completion expected by July 2026. The terms and conditions of the Subsequent Tender Offer will be published, alongside an accompanying tender offer form for certificated holders, at the relevant time.
2.6 The Board intends to seek shareholder authority to carry out any further tender offers under the Biannual Tender Offer Facility, in relation to the financial year ending 31 March 2027, at the Company's annual general meeting to be held in 2026. The participation or otherwise by any Shareholder in any prior tender offer (including the Tender Offer) will not preclude the participation by such Shareholder in any subsequent tender offer.
2.7 The Board is unanimously recommending that you vote in favour of the Resolution to be proposed at the General Meeting. For the avoidance of doubt, the Resolution would provide the Company with sufficient authority to undertake the Tender Offer and the Subsequent Tender Offer, albeit details of the Subsequent Tender Offer will be announced in due course in the manner described at paragraph 2.5 above.
2.8 Shareholders who do not wish to tender Shares in the Tender Offer should not complete or return a Tender Form or submit a TTE Instruction in CREST.

3 THE COMPANY

3.1 Performance history

The Investment Manager has a long-term investment approach. Over the 10 years to 30 September 2025, the Company delivered a NAV total return of 244.6%, outperforming the Company's benchmark index, the MSCI Europe ex-UK SmallCap Index (in Sterling terms) (the "Benchmark"), by 80.6%. Since the Investment Manager's appointment in September 2006, the Company's has delivered an annualised NAV total return of 10.3%, 1.9% per annum ahead of the Benchmark.

The Investment Manager seeks to invest exclusively in high quality growing companies based on the belief that over the long term, a company's ability to compound earnings and cash flows is the primary driver of investment returns. However, in the short term, factors such as investor flows, political developments and macroeconomic fluctuations can temporarily overshadow underlying fundamentals.

	6 months	1 year	3 year	5 year	10 year	MAM*
Total Returns (%)
(as at 30 September 2025)
Share price	14.1%	17.1%	60.6%	24.3%	254.8%	556.4%
NAV per Share	13.7%	11.7%	50.7%	31.8%	247.0%	551.4%
Benchmark (Composite)	15.4%	15.8%	48.5%	45.7%	164.0%	368.7%

Sources: Morningstar Direct, Association of Investment Companies ('AIC'), Investment Manager.

3.2 Dividends

The Company expects to continue to pay two interim dividends in January and August each year. The first interim dividend relating to the year ending 31 March 2026 ("First 2026 Dividend") will be announced in the Company's half-yearly report, scheduled to be published on or around 31 October 2025, and will be paid alongside an additional third interim dividend for the year ended 31 March 2025 ("Third 2025 Dividend"). The Dividends are expected to be paid in January 2026.

For the avoidance of doubt, Shareholders will not be eligible to receive the First 2026 Dividend or the Third 2025 Dividend in respect of any Shares which are successfully tendered and repurchased under the Tender Offer.

^*From the commencement of MAM's appointment as Investment Manager (September 2006).

3.3 Outlook

The valuations of European SmallCaps continue to look cheap both relative to their own history and to the wider European market. This is despite SmallCap modestly outperforming LargeCap over the last one and two years. It may prove too early to call a decisive turning point and resumption of the longer-term historical trend of SmallCap outperformance, but the Investment Manager believes that the preconditions for it look increasingly favourable.

After a relatively prolonged period in which the Company's quality growth style has been out of favour, it is natural to ask when this headwind might abate or reverse. It is impossible to say with precision, but the Investment Manager notes that growth companies have now recorded their longest and deepest period of underperformance relative to value since before the Global Financial Crisis of 2008, while quality has seen similarly historic drawdowns both in Europe and wider global markets. The Investment Manager believes that when assets are most out of favour they can represent the best long-term investment opportunities.

The investment process allows the Investment Manager to continue to identify profitable, highreturn businesses that are off the beaten track for most investors ('hidden gems'). The Investment Manager believes the quality of the companies in the Company's portfolio remains as high as ever (and the Board and Investment Manager remain mindful of the risks of 'style drift'). The Investment Manager also continues to deepen resources in support of its long-standing, experienced research team, which it believes provides a real competitive advantage.

4 FURTHER INFORMATION ON THE TENDER OFFER

4.1 The Board has arranged for Cavendish to conduct the Tender Offer for up to 5% of the Company's Shares in issue as at the Latest Practicable Date at the Tender Price. The Company will pay the Tender Price in cash. Further details of the Tender Offer are set out in Part 3 and Part 4 of this document.
4.2 The maximum number of Shares to be acquired under the Tender Offer is 7,409,587 Shares, representing 5% of the Shares in issue (excluding Shares held in treasury) as at the Latest Practicable Date (being 16 October 2025).
4.3 The Board may continue to make market purchases of Shares pursuant to its stated discount management policy during the Tender Offer period, to the extent that it has Shareholder authority to do so, meaning that the 7,409,587 Shares to be acquired may represent slightly more than 5% of the Shares in issue on completion of the Tender Offer.
4.4 The purchase of Shares under the Tender Offer is expected to result in a modest uplift in NAV per Share for Shareholders who continue with their investment in the Company.
4.5 The Tender Offer will only be open to Shareholders on the register at 18:00 hours on 19 November 2025 ("Tender Record Date"). The Tender Offer is subject to certain conditions set out in paragraph 2 of Part 4 of this document. In addition, the Tender Offer may be suspended or terminated in certain circumstances, as set out in paragraph 7 of Part 4 of this document.
4.6 The Tender Offer is intended to enable those Eligible Shareholders who wish to sell some or all of their Shares to elect to do so, subject to the overall limits of the Tender Offer. Shareholders who successfully tender Shares will receive the Tender Price per Share.
4.7 An Eligible Shareholder tendering up to their Basic Entitlement will have their tender satisfied in full. Any Eligible Shareholder tendering more than their Basic Entitlement will have their Excess Application satisfied if there are sufficient remaining Available Shares. Such Available Shares shall be apportioned to Eligible Shareholders pro rata to their Excess Applications should other Eligible Shareholders not tender the full amount of their Basic Entitlement and as a result of certain Overseas Shareholders not being permitted to participate in the Tender Offer.
4.8 Shares that are tendered for acceptance under the Tender Offer may not be sold, transferred, charged or otherwise disposed of. Shares that are tendered for acceptance under the Tender Offer may only be withdrawn with the prior consent of the Board.
4.9 The timing of the Calculation Date and for settlement of the consideration to which any Eligible Shareholder is entitled under the Tender Offer takes into account the period required for the orderly realisation of investments sufficient to meet accepted tenders and the time for the Company to receive the proceeds of such realisations.
4.10 Shareholders' attention is drawn to the letter from Cavendish in Part 2 of this document and to the details set out in Part 3 and Part 4 of this document which, together (where applicable) with the Tender Form, constitute the terms and conditions of the Tender Offer. Details of how to tender Shares can be found in paragraph 3 of Part 4 of this document.
4.11 In making the Tender Offer, Cavendish will purchase the Shares which have been validly tendered as principal by means of an on-market purchase from tendering Shareholders and will sell the tendered Shares acquired by it on to the Company pursuant to the terms of the Repurchase Agreement. All Shares acquired by the Company from Cavendish under the Repurchase Agreement will be held in treasury.
4.12 The record dates for the First 2026 Dividend and Third 2025 Dividend will follow the Tender Record Date. Accordingly, Shareholders will not be eligible to receive the First 2026 Dividend and Third 2025 Dividend in respect of any Shares which are successfully tendered and repurchased under the Tender Offer.

5 OVERSEAS SHAREHOLDERS

The Tender Offer is not available to certain Overseas Shareholders. The attention of Overseas Shareholders is drawn to paragraph 9 of Part 4 of this document.

6 US SHAREHOLDERS

6.1 The Tender Offer is being made to US Shareholders in compliance with the applicable US tender offer rules under the Exchange Act, including Regulation 14E thereunder and otherwise in accordance with the requirements of Scottish law, the London Stock Exchange and the FCA. Accordingly, the Tender Offer may be subject to disclosure and other procedural requirements, including with respect to withdrawal rights, offer timetable, settlement procedures and timing of payments that are different from those applicable under US domestic tender offer procedures and law.
6.2 The attention of US Shareholders is drawn to the section titled "Notice For US Shareholders" on page 4 of this document.

7 TAXATION

Eligible Shareholders who sell Shares in the Tender Offer may, depending on their individual circumstances, incur a liability to taxation. The attention of Eligible Shareholders is drawn to Part 6 of this document which sets out a general guide to certain aspects of current law and tax authority practice in respect of UK taxation. Eligible Shareholders should consult an appropriate professional adviser as to their tax position.

8 COSTS AND EXPENSES

The costs and expenses relating to the Tender Offer will be reflected in the calculation of the Tender Price as explained in paragraph 1 of Part 3 of this document, and so will be borne by Shareholders as a whole.

9 GENERAL MEETING

9.1 The implementation of the Tender Offer requires the approval of Shareholders. A notice convening a General Meeting of the Company, which is to be held at 10:00 hours on 19 November 2025 at the offices of Juniper Partners Limited, at 28 Walker Street, Edinburgh, EH3 7HR, is set out at the end of this document. To be approved, the Resolution, which is being proposed as a special resolution, must be passed by at least 75% of the votes of Shareholders who vote in person or by proxy, or in the case of corporations, by their duly authorised representatives, at the General Meeting.

9.2 The Resolution would allow the Company to buy back up to 14,819,174 Shares in order to effect the Tender Offer and the Subsequent Tender Offer. All Shares purchased pursuant to the Resolution shall be held in treasury.
9.3 All Shareholders are entitled to attend and vote at the General Meeting. In accordance with the Articles of Association, all Shareholders present in person or by proxy shall upon a show of hands have one vote and upon a poll shall have one vote in respect of each Share held. It is expected that voting at the General Meeting will be by way of a poll. In order to ensure that a quorum is present at the General Meeting, it is necessary for two Shareholders entitled to vote to be present, whether in person or by proxy (or, if a corporation, by a representative). In the event that the General Meeting is adjourned and the above-mentioned quorum is not present, at such adjourned General Meeting, the quorum shall be one.

10 ACTION TO BE TAKEN

10.1 Voting

(a) ALL SHAREHOLDERS ARE ENCOURAGED TO VOTE ON THE RESOLUTION TO BE PROPOSED AT THE GENERAL MEETING AND, IF THEIR SHARES ARE NOT HELD DIRECTLY, TO ARRANGE FOR THEIR NOMINEE TO VOTE ON THEIR BEHALF.
(b) Those who do not hold their Shares directly (including those who have invested through investor platforms) are encouraged to instruct their nominee to vote on their behalf in good time, to ensure that their votes, which are important to the Company, are received and taken into account. If investor platforms have instructions on how votes should be submitted and specify a deadline for receipt, please note those instructions and also note that the deadline is likely to be earlier than the time and date for receipt of Forms of Proxy set out above.
(c) Shareholders will find enclosed with this document a personalised Form of Proxy for use in connection with the General Meeting. Submission of a proxy appointment will enable your vote to be counted at the General Meeting in the event of your absence.
(d) Shareholders are asked to complete and return the Form of Proxy, in accordance with the instructions printed thereon as soon as possible and, in any event, so as to reach the Company's registrars, Equiniti Limited, by no later than 10:00 hours on 17 November 2025. The Form of Proxy can be returned by delivery to Equiniti Limited, Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA, by completing it online at www.shareview.co.uk or, in the case of CREST members, by utilising the CREST electronic proxy appointment service in accordance with the procedures set out in the Notice of General Meeting and the CREST Manual on the Euroclear website (www.euroclear.com). Institutional investors may also be able to appoint a proxy electronically via the Proxymity platform, a process which has been agreed by the Company and approved by the Registrar. For further information regarding Proxymity, please go to www.proxymity.io and refer to the procedures set out in the Notice of General Meeting.
(e) Shareholders are requested to complete and return the Form of Proxy whether or not they wish to attend the General Meeting. The return of the Form of Proxy will not prevent Shareholders from attending the General Meeting, or any adjournment thereof, and voting in person should they so wish.

10.2 Tender Form

(a) SHAREHOLDERS WHO DO NOT WISH TO TENDER THEIR SHARES IN THE COMPANY SHOULD NOT COMPLETE OR RETURN A TENDER FORM OR SUBMIT A TTE INSTRUCTION IN CREST.
(b) Eligible Shareholders who wish to participate in the Tender Offer and hold their Shares in certificated form should complete the Tender Form in accordance with the instructions set out thereon and return the completed Tender Form to Equiniti Limited, Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA to arrive as soon as possible and, in any event, by no later than 13:00 hours on 19 November 2025.
(c) Eligible Shareholders who wish to participate in the Tender Offer and hold their Shares in certificated form should also return their Share certificate(s) and/or other document(s) of title in respect of the Shares tendered with their Tender Form.
(d) Eligible Shareholders who wish to tender Shares and hold their Shares in uncertificated form (that is, in CREST) should arrange for the relevant Shares to be transferred to escrow by means of a TTE Instruction as described in paragraph 3 of Part 4 of this document.

11 RECOMMENDATION

11.1 The Directors consider that the Resolution is in the best interests of the Company and its Shareholders as a whole. Accordingly, the Board unanimously recommends Shareholders to vote in favour of the Resolution to be proposed at the General Meeting, as they intend to do in respect of their own beneficial shareholdings.
11.2 The Directors and the Investment Manager have a combined beneficial holding of Shares representing approximately 9.1% of the issued share capital and, due to their belief in the positive long-term outlook for the Company, will not participate in the Tender Offer.
11.3 The Directors are making no recommendation to Eligible Shareholders as to whether they should tender Shares in the tender offer. Whether Eligible Shareholders decide to tender Shares will depend, among other things, on their view of the Company's prospects and their own individual circumstances, including their tax position. Shareholders who are in any doubt as to the action they should take should consult an appropriate independent professional adviser.
11.4 You are requested to appoint your proxy as soon as possible, whether or not you intend to tender Shares in the Tender Offer.

Yours faithfully

Richard Curling Chairman

PART 2 LETTER FROM CAVENDISH CAPITAL MARKETS LIMITED

1 Bartholomew Close London EC1A 7BL

20 October 2025

To Shareholders of Montanaro European Smaller Companies Trust plc

Dear Sir or Madam

TENDER OFFER

As explained in the letter from your Chairman in Part 1 of this document, Eligible Shareholders are being given the opportunity to tender some or all of their Shares for purchase in the Tender Offer on the basis set out below and in accordance with Part 3 and Part 4 of this document.

This letter sets out the principal terms and conditions of the Tender Offer. Further details are set out in Part 3 and Part 4 of this document and (where applicable) the accompanying Tender Form, which terms and conditions are deemed to be incorporated herein and form part of the Tender Offer.

Cavendish hereby invites Eligible Shareholders to tender Shares for purchase by Cavendish at the Tender Price.

This letter is not a recommendation to Shareholders to sell or tender their Shares and Shareholders are not obliged to tender any Shares. Shareholders who do not wish to tender their Shares in the Company need take no further action and should not complete or return a Tender Form or submit a TTE Instruction in CREST.

The Tender Offer is being made for up to 7,409,587 Shares representing 5% of the Company's issued share capital (excluding Shares held in treasury) as at the Latest Practicable Date (being 16 October 2025).

The Tender Price will be calculated as a 5% discount to the prevailing Net Asset Value per Share as at the Calculation Date, as more particularly set out in Part 3 of this document.

Successful tenders will be determined as follows:

all Eligible Shareholders tendering up to their Basic Entitlement will have their tender satisfied in full; and
Eligible Shareholders tendering Excess Applications will have their Excess Applications fulfilled if there are remaining Available Shares for such purpose. Such Available Shares shall be apportioned to Eligible Shareholders pro rata to their Excess Applications should other Eligible Shareholders not tender the full amount of their Basic Entitlement and as a result of certain Overseas Shareholders not being permitted to participate in the Tender Offer.

1 CONDITIONS OF THE TENDER OFFER

1.1 The Tender Offer will not proceed unless it becomes unconditional. The following are the principal conditions of the Tender Offer (the full conditions of the Tender Offer are set out in Part 4 of this document):
(a) the passing of the Resolution at the General Meeting or any adjournment thereof;
(b) the Repurchase Agreement not having been terminated in accordance with its terms;
(c) the Directors being satisfied on reasonable grounds that the Company has sufficient distributable profits (as defined in section 830 of the Companies Act) to effect the purchase of all Shares successfully tendered pursuant to the Repurchase Agreement; and
(d) the Tender Offer not lapsing, being suspended or terminated in accordance with the provisions set out in paragraph 7 of Part 4 of this document.
1.2 In the event that the Directors are not satisfied that the Company has sufficient distributable profits (as defined in section 830 of the Companies Act) to effect the purchase of all validly tendered Shares but would have sufficient distributable profits if a lesser number of Exit Shares were purchased, then Cavendish may, at its sole discretion and subject to the terms of the Repurchase Agreement, purchase such of the Exit Shares on a pro rata basis up to, and subject to, the number that it is lawfully permitted to purchase.

2 PROCEDURE FOR TENDERING SHARES

Full details of the procedure for tendering Shares are set out in Part 3 and Part 4 of this document and (where applicable) in the Tender Form.

3 ELIGIBLE SHAREHOLDERS

3.1 Shares held in certificated form

(a) Eligible Shareholders who wish to tender their Shares should complete the Tender Form in accordance with the instructions set out therein and return the completed Tender Form to the address on it as soon as possible and in any event, in order to be valid, so as to arrive not later than 13:00 hours on 19 November 2025.
(b) Eligible Shareholders who hold their Shares in certificated form should also return their Share certificate(s) and/or other documents of title in respect of the Shares tendered with their Tender Form.

3.2 Shares held in uncertificated form

Eligible Shareholders who hold their Shares in uncertificated form (i.e. in CREST) and who wish to tender all or any of their Shares should tender electronically through CREST so that the TTE Instruction settles by no later than 13:00 hours on 19 November 2025. The CREST Manual may also assist you in making a TTE Instruction.

4 TRANSFER OF TENDERED SHARES

Eligible Shareholders should note that, once tendered, Shares may not be sold, transferred, charged, lent or otherwise disposed of. Although the Tender Form for Eligible Shareholders must be returned by 13:00 hours on 19 November 2025, the purchase of any Shares by Cavendish may not be effected until 3 December 2025. Upon having returned a Tender Form, an Eligible Shareholder is deemed to accept that such a tender application may not be withdrawn or cancelled, save with the consent of the Company before the Tender Closing Date.

5 VALIDITY OF TENDER FORMS

Tender Forms which are received by Equiniti after 13:00 hours on 19 November 2025 or which at that time are incorrectly completed or, in respect of Eligible Shareholders, not accompanied by all relevant documents or instructions may be rejected and returned to Shareholders or their appointed agent, together with any accompanying Share certificate(s) and/or other document(s) of title or a satisfactory indemnity in lieu thereof. However, Cavendish reserves the right to treat as valid Tender Forms which are not entirely in order and which, in respect of the Eligible Shareholders, are not accompanied by the relevant Share certificate(s) and/or other document(s) of title or a satisfactory indemnity in lieu thereof and shall be entitled (in its sole discretion) to accept late Tender Forms.

6 RESTRICTED SHAREHOLDERS AND OTHER OVERSEAS SHAREHOLDERS

The Tender Offer is not available to Shareholders with registered or mailing addresses in a Restricted Jurisdiction, or who are citizens or nationals of, or resident in, a Restricted Jurisdiction and such Shareholders should read paragraph 9 of Part 4 of this document and (where applicable) the relevant provisions of the Tender Form.

7 US SHAREHOLDERS

7.1 The Tender Offer is being made to US Shareholders in compliance with the applicable US tender offer rules under the Exchange Act, including Regulation 14E thereunder and otherwise in accordance with the requirements of Scottish law, the London Stock Exchange and the FCA. Accordingly, the Tender Offer may be subject to disclosure and other procedural requirements, including with respect to withdrawal rights, offer timetable, settlement procedures and timing of payments that are different from those applicable under US domestic tender offer procedures and law.
7.2 The attention of US Shareholders is drawn to the section titled "Notice For US Shareholders" on page 4 of this document.

8 SETTLEMENT

Subject to the Tender Offer becoming unconditional, payment of the Tender Price due to Eligible Shareholders whose tenders under the Tender Offer have been accepted is expected to be made as follows:

in the case of uncertificated shares payments through CREST are expected to be made and CREST accounts settled by 5 December 2025; and
in the case of certificated shares cheques and balancing share certificates are expected to be despatched to certificated Shareholders by 15 December 2025.

However as described in paragraph 4 of Part 4 of this document, the Company reserves the right, if the Board considers it to be in the interests of Shareholders as a whole, to defer settlement.

9 FURTHER INFORMATION

Your attention is drawn to the information contained in the rest of this document, including, in particular, the mechanics of the Tender Offer and terms and conditions of the Tender Offer set out in Part 3 and Part 4 of this document.

Yours faithfully,

Cavendish Capital Markets Limited

PART 3 FURTHER INFORMATION ON THE TENDER OFFER

1 CALCULATION OF TENDER PRICE

1.1 The Tender Price will be the amount equivalent to 95% of the Net Asset Value per Share as at close of business on the Calculation Date, calculated in accordance with the Company's normal accounting policies and expressed in pence Sterling to four decimal places with 0.00005 pence being rounded downwards.
1.2 The calculation of the Tender Price in accordance with paragraph 1.1 above will take place after the Calculation Date.

2 EXCESS APPLICATIONS

2.1 Basic Entitlements will be calculated by reference to registered shareholdings as at the Tender Record Date and will be rounded down to the nearest whole number of Shares. Registered shareholders who hold Shares for multiple beneficial owners may decide allocations among such beneficial owners at their own discretion.
2.2 Eligible Shareholders may tender Shares in excess of their respective Basic Entitlement. Such Eligible Shareholders will have their Excess Applications fulfilled if there are remaining Available Shares for such purpose. Such Available Shares shall be apportioned to Eligible Shareholders pro rata to their Excess Applications should other Eligible Shareholders not tender the full amount of their Basic Entitlement and as a result of certain Overseas Shareholders not being permitted to participate in the Tender Offer.

3 GENERAL

The Company's administrator, Juniper Partners Limited, will prepare, or procure the preparation of the Net Asset Value and the Tender Price as at the Calculation Date. In the event of a dispute regarding any such calculations, such dispute will be determined by a chartered accountant selected by agreement between the Company and the Investment Manager, or, in default of such agreement within 14 days of the relevant date on which the calculation is made, selected by the President for the time being of the Institute of Chartered Accountants of Scotland. Such chartered accountant will act as an expert and not as an arbitrator and their determination shall be final and legally binding on all parties, provided that any such chartered accountant will be bound by any basis of allocation or method of valuation agreed between the Investment Manager and the Company.

PART 4 TERMS AND CONDITIONS OF THE TENDER OFFER

1 TENDERS

1.1 All Shareholders on the Register at the Tender Record Date (other than Shareholders in a Restricted Jurisdiction) may tender Shares for purchase by Cavendish (acting as principal) on the terms and subject to the conditions set out in this document and the accompanying Tender Form (which together with this document constitutes the Tender Offer). Shareholders are not obliged to tender any Shares.
1.2 The Tender Offer is made at the Tender Price to be calculated in accordance with Part 3 of this document.
1.3 The consideration for each tendered Share acquired by Cavendish pursuant to the Tender Offer will be paid in accordance with the settlement procedures set out in paragraph 4 below.
1.4 Basic Entitlements will be calculated by reference to registered shareholdings as at the Tender Record Date and will be rounded down to the nearest whole number of Shares. Registered Shareholders who hold Shares for multiple beneficial owners may decide allocations among such beneficial owners at their own discretion.
1.5 Eligible Shareholders may tender Shares in excess of their respective Basic Entitlement. Such Eligible Shareholders will have their Excess Applications fulfilled if there are remaining Available Shares for such purpose. Such Available Shares shall be apportioned to Eligible Shareholders pro rata to their Excess Applications should other Eligible Shareholders not tender the full amount of their Basic Entitlement and as a result of certain Overseas Shareholders not being permitted to participate in the Tender Offer.
1.6 A maximum of 7,409,587 Shares will be acquired by Cavendish under the Tender Offer, representing 5% of the Shares in issue (excluding Shares held in treasury) as at the Latest Practicable Date.

2 CONDITIONS

2.1 The Tender Offer is conditional on the following:
(a) the passing of the Resolution at the General Meeting or any adjournment thereof;
(b) the Repurchase Agreement not having been terminated in accordance with its terms;
(c) subject to paragraph 2.3 below, the Directors being satisfied on reasonable grounds that the Company has sufficient distributable profits (as defined in section 830 of the Companies Act) to effect the purchase of the Exit Shares pursuant to the Repurchase Agreement. For the avoidance of doubt, the Directors were satisfied as to this requirement as at the Latest Practicable Date;
(d) the Company and Cavendish not having agreed to terminate the Tender Offer for any reason at their sole discretion;
(e) Cavendish being satisfied, acting in good faith, that at all times up to and immediately prior to the announcement of the results of the Tender Offer, the Company has complied with its obligations, and is not in breach of any representations and warranties given by it, under the Repurchase Agreement; and
(f) the Tender Offer not having been terminated in accordance with paragraph 7 of this Part 4 prior to the fulfilment of the conditions referred to in paragraph 2.1 above.
2.2 Cavendish will not purchase (or enter into any commitment or contract to purchase) Shares pursuant to the Tender Offer unless the Conditions have been satisfied (or, where applicable, waived). If the Conditions are not satisfied (or, where applicable, waived) prior to the close of

business on 20 December 2025, Cavendish may postpone completion of the Tender Offer for up to 30 Business Days after which time the Tender Offer, if not then completed, will lapse.

2.3 In the event that the Directors are not satisfied that the Company has sufficient distributable profits (as defined in section 830 of the Companies Act) to effect the purchase of all tendered Shares but would have sufficient distributable profits if a lesser number of Exit Shares were purchased, then Cavendish may, at its sole discretion and subject to the terms of the Repurchase Agreement, purchase such of the Exit Shares on a pro rata basis up to, and subject to, the number that it is lawfully permitted to purchase.

3 PROCEDURE FOR TENDERING SHARES

To tender Shares you must complete, sign and return the accompanying Tender Form or submit a TTE Instruction in CREST in accordance with this paragraph 3 and the instructions printed on the Tender Form.

3.1 Completion of Tender Form

If you hold your shares in certificated form, to participate in the Tender Offer, you must complete the Tender Form which (where applicable) accompanies this document. Details of the procedures to be followed are set out in the Tender Form. If you hold Shares in certificated form, you should complete a separate Tender Form for each holding. In addition, you should complete separate Tender Forms for Shares held in uncertificated form but under different member account IDs and for Shares held in certificated form but under different designations. Additional Tender Forms are available from Equiniti on +44 (0)371 384 2431. Calls are charged at the standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged at the applicable international rate. The helpline is open between 08:30 hours to 17:30 hours Monday to Friday excluding public holidays in England and Wales. Please note that Equiniti cannot provide any financial, legal or tax advice and calls may be recorded and monitored for security and training purposes. No acknowledgement of receipt of returned forms will be given.

3.2 Return of Tender Form – Shareholders

Where applicable the completed and signed Tender Form should be sent by post to the address on the form as soon as possible and, in any event, so as to arrive by no later than 13:00 hours on 19 November 2025. The Company and Cavendish shall be entitled (at their sole discretion) to accept late Tender Forms. Provisions relating to Overseas Shareholders are contained in paragraph 9 of this Part 4.

By signing the Tender Form, Shareholders will be deemed to have appointed the Registrar as agent in respect of settlement of the purchase of Shares by Cavendish. Cavendish will therefore issue a contract note to the Registrar with instructions that such consideration be remitted in accordance with the instructions set out in the Tender Form.

(a) Shares held in certificated form (that is, not in CREST)

In respect of Shareholders that hold Shares in certificated form, the completed and signed Tender Form should be accompanied by the relevant Share certificate(s) and/or other document(s) of title. If your Share certificate(s) and/or other document(s) of title are not readily available (for example, if they are with your stockbroker, bank or other agent), the Tender Form should nevertheless be completed, signed and returned as described above so as to be received by Equiniti not later than 13:00 hours on 19 November 2025 together with any Share certificate(s) and/or other document(s) of title that you may have available, accompanied by a letter of explanation stating that the (remaining) Share certificate(s) and/ or other documents(s) of title will be forwarded as soon as possible thereafter and, in any event, not later than 13:00 hours on 19 November 2025.

If you have lost your Share certificate(s) and/or other document(s) of title, you should contact the Registrar for a letter of indemnity in respect of the lost Share certificate(s) which, when completed in accordance with the instructions given, should be returned to the Registrar at the address on the Tender Form so as to be received not later than 13:00 hours on 19 November 2025. The Registrar can be contacted on telephone number +44 (0)371 384 2431. Calls are charged at the standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged at the applicable international rate. The helpline is open between 08:30 hours and 17:30 hours, Monday to Friday excluding public holidays in England and Wales. Please note that Equiniti cannot provide any financial, legal or tax advice and calls may be recorded and monitored for security and training purposes.

(b) Shares held in CREST

If the Shares which you wish to tender are held in uncertificated form, you should take (or procure to be taken) the action set out below to transfer (by means of a TTE Instruction) the number of Shares which you wish to tender under the Tender Offer to an escrow balance, specifying Equiniti (in its capacity as a CREST escrow agent under its participant ID referred to below) as the escrow agent, as soon as possible and in any event so that the transfer to escrow settles not later than 13:00 hours on 19 November 2025. Cavendish shall be entitled (in its sole discretion) to accept late transfers to escrow.

If you are a CREST sponsored member, you should refer to your CREST sponsor before taking any action. Only your CREST sponsor will be able to send the TTE Instruction to Euroclear in relation to the Shares which you wish to tender. You should send (or, if you are a CREST sponsored member, procure that your CREST sponsor sends) a TTE Instruction to Euroclear, which must be properly authenticated in accordance with Euroclear's specification and which must contain, in addition to other information that is required for the TTE Instruction to settle in CREST, the following details:

the total number of Shares to be transferred to an escrow balance;
your member account ID;
your participant ID;
the participant ID of the escrow agent, Equiniti, in its capacity as a CREST receiving agent. This is 5RA80;
the member account ID of the escrow agent, this is: RA780101;
the corporate action number for the Tender Offer. This is allocated by Euroclear and can be found by viewing the relevant corporate action details in CREST;
the intended settlement date for the transfer to escrow. This should be as soon as possible and in any event not later than 13:00 hours on 19 November 2025;
the ISIN of the Shares, which is GB00BM8H3X05;
the input with the standard transfer to escrow delivery instruction priority 80; and
a contact name and telephone number in the shared note field.

After settlement of the TTE Instruction, you will not be able to access the Shares concerned in CREST for any transaction or for charging purposes, notwithstanding they will be held by the Registrar as your agent until completion or lapsing of the Tender Offer. If the Tender Offer becomes unconditional, the Registrar will transfer the Shares which are accepted for purchase by Cavendish to itself as their agent.

You are recommended to refer to the CREST Manual published by Euroclear for further information on the CREST procedures outlined above.

You should note that Euroclear does not make available special procedures, in CREST, for any particular corporate action. Normal system timings and limitations will therefore apply in connection with a TTE Instruction and its settlement. You should therefore ensure that all necessary action is taken by you (or by your CREST sponsor) to enable a TTE Instruction relating to your Shares to settle prior to 13:00 hours on 19 November 2025. In this connection you are referred in particular to those sections of the CREST Manual concerning practical limitations of the CREST system and timings. Cavendish shall be entitled (in its sole discretion) to accept late TTE Instructions.

An appropriate announcement will be made if any of the details contained in this paragraph 3 are altered.

(c) Deposits of Shares into, and withdrawals of Shares from, CREST

Normal CREST procedures (including timings) apply in relation to any Shares that are, or are to be, converted from uncertificated to certificated form, or from certificated to uncertificated form, during the course of the Tender Offer (whether such conversion arises as a result of a transfer of Shares or otherwise). Shareholders who are proposing to convert any such Shares are recommended to ensure that the conversion procedures are implemented in sufficient time to enable the person holding or acquiring the Shares as a result of the conversion to take all necessary steps in connection with such person's participation in the Tender Offer (in particular, as regards delivery of Share certificates and/ or other documents of title or transfers to an escrow balance as described above) prior to 13:00 hours on 19 November 2025.

3.3 Validity of Tender Forms

Notwithstanding the powers in paragraph 8.4 below, the Company and Cavendish reserve the right to treat as valid only Tender Forms which are entirely in order and are received by 13:00 hours on 19 November 2025 and which are accompanied (in the case of Shares held in certificated form) by the relevant Share certificates and/or other document(s) of titles or a satisfactory indemnity in lieu thereof or (in the case of Shares held in uncertificated form) by the relevant TTE Instruction in respect of the entire number of Shares tendered. The Tender Closing Date for Shareholders is at 13:00 hours on 19 November 2025.

Tenders from the United States will be accepted only from Qualifying US Shareholders.

Notwithstanding the completion of a valid Tender Form, the Tender Offer may be suspended, terminated or may lapse in accordance with the Terms and Conditions set out in this Part 4.

Cavendish shall be entitled to accept Tender Forms which are received after the Tender Closing Date. The decision of Cavendish as to which Shares have been validly tendered shall be conclusive and binding on all Shareholders. If you are in any doubt as to how to complete the Tender Form or as to the procedure for tendering Shares, please contact Equiniti on +44 (0)371 384 2431. Calls are charged at the standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged at the applicable international rate. The helpline is open between 08:30 hours and 17:30 hours, Monday to Friday excluding public holidays in England and Wales. Please note that Equiniti cannot provide any financial, legal or tax advice and calls may be recorded and monitored for security and training purposes.

4 SETTLEMENT

4.1 Payment of the consideration to which any Shareholder is entitled pursuant to valid tenders accepted by Cavendish is expected to be made as follows:
in the case of uncertificated shares payments through CREST are expected to be made and CREST accounts settled by 5 December 2025; and
in the case of certificated shares cheques and balancing share certificates are expected to be despatched to certificated Shareholders by 15 December 2025.

The Company reserves the right, if the Board considers it to be in the best interest of Shareholders as a whole, to defer the payment of the Tender Price.

(a) Shares held in certificated form (that is, not in CREST)

Where an accepted tender relates to Shares held in certificated form, cheques for the consideration due will be dispatched by Equiniti by first class post to the person or agent whose name and address is set out in Box 1 (or, if relevant, Box 3) of the Tender Form or, if none is set out, to the registered address of the tendering Shareholder or, in the case of joint holders, the address of the first named. All cash payments will be made in Sterling by cheque drawn on a branch of a UK clearing bank.

(b) Shares held in CREST

Where an accepted tender relates to Shares held in uncertificated form in CREST, the consideration due will be paid in pence Sterling by means of CREST by Cavendish procuring the creation of a CREST payment in favour of the tendering Shareholder's payment bank in accordance with the CREST payment arrangements.

4.2 If only part of a holding of Shares is sold pursuant to the Tender Offer:
(a) where the Shares are held in certificated form, the Shareholder will be entitled to receive a certificate in respect of the balance of the remaining Shares; and
(b) where the Shares are held in uncertificated form (that is, in CREST), the unsold Shares will be transferred by the escrow agent by means of a TFE Instruction to the original available balance from which those Shares came.

5 REPRESENTATIONS AND WARRANTIES

Tender Form – Representations and warranties

5.1 Each Shareholder by whom, or on whose behalf, a Tender Form is executed irrevocably undertakes, represents, warrants and agrees to and with Cavendish (so as to bind him, his personal representatives, heirs, successors and assigns) that:
(a) the execution of the Tender Form shall constitute an offer to sell to Cavendish the number of Shares inserted or deemed to be inserted in Box 1A or 1B (as appropriate) of the Tender Form on and subject to the terms and conditions set out or referred to in this document and the Tender Form and that, once lodged, such offer shall be irrevocable;
(b) such Shareholder has full power and authority to tender, sell, assign or transfer the Shares in respect of which such offer is accepted (together with all rights attaching thereto) and, when the Shares are purchased by Cavendish, Cavendish will acquire such Shares with full title guarantee and free from all liens, charges, encumbrances, equitable interests, rights of pre-emption or other third party rights of any nature and together with all rights attaching thereto on or after the Tender Closing Date including the right to receive all dividends and other distributions declared paid or made after that date (but, for the avoidance of doubt, Shareholders will not be eligible to receive either Dividend in respect of any Shares which are successfully tendered and repurchased under the Tender Offer);
(c) the execution of the Tender Form will, subject to the Tender Offer becoming unconditional, constitute the irrevocable appointment of any director or officer of Cavendish as such Shareholder's attorney and/or agent ("attorney"), and an irrevocable instruction to the attorney to complete and execute all or any instruments of transfer and/or other documents at the attorney's discretion in relation to the Shares referred to in paragraph 5.1(a) above in favour of Cavendish or such other person or persons as Cavendish may direct and to deliver such instrument(s) of transfer and/or other documents at the discretion of the attorney, together with the Share certificate(s) and/or other document(s) relating to such Shares, for registration within six months of the Tender Offer becoming unconditional and to do all such other acts and things as may in the opinion of such attorney be necessary or expedient for the purpose of, or in connection with, the Tender Offer and to vest in Cavendish or its nominee(s) or such other person(s) as Cavendish may direct such Shares;
(d) such Shareholder agrees to ratify and confirm each and every act or thing which may be done or effected by Cavendish or any of its directors or any person nominated by Cavendish in the proper exercise of its or his or her powers and/or authorities hereunder;
(e) if holding Shares in certificated form, such Shareholder will deliver to the Registrar their Share certificate(s) and/or other document(s) of title in respect of the Shares referred to in sub-paragraph 5.1(a) above, or an indemnity acceptable to Cavendish in lieu thereof, or

will procure the delivery of such document(s) to such person as soon as possible thereafter and, in any event, not later than the Tender Closing Date;

(f) such Shareholder shall do all such acts and things as shall be necessary or expedient and execute any additional documents deemed by Cavendish to be desirable, in each case to complete the purchase of the Shares and/or to perfect any of the authorities expressed to be given hereunder;
(g) such Shareholder has not received or sent copies or originals of the Tender Form, or any related documents into a Restricted Jurisdiction and has not otherwise utilised in connection with the Tender Offer, directly or indirectly, the mails or any means or instrumentality (including, without limitation, the internet, facsimile transmission, telex and telephone) of interstate or foreign commerce, or of any facility of a national securities exchange, of any Restricted Jurisdiction, that the Tender Form has not been mailed or otherwise sent in, into or from any Restricted Jurisdiction and that such Shareholder is not accepting the Tender Offer from any Restricted Jurisdiction;
(h) if such Shareholder is an Overseas Shareholder,
(i) it is not in any Restricted Jurisdiction or in any territory in which it is unlawful to make or accept the Tender Offer or to use the Tender Form in any manner in which such person has used or will use it;
(ii) it has fully observed any applicable legal and regulatory requirements of the territory in which such Overseas Shareholder is resident or located; and
(iii) the invitation under the Tender Offer may lawfully be made to such Overseas Shareholder under the laws of the relevant jurisdiction;
(i) the provisions of the Tender Form shall be deemed to be incorporated into the terms and conditions of the Tender Offer;
(j) the dispatch of a cheque in respect of the Tender Price to such Shareholder at his registered address or such other address as is specified in the Tender Form will constitute a complete discharge by Cavendish of its obligations to make such payment to such Shareholder;
(k) on execution, the Tender Form takes effect as a deed; and
(l) the execution of the Tender Forms constitutes such Shareholder's submission to the jurisdiction of the courts of England in relation to all matters arising out of, or in connection with, the Tender Offer or the Tender Forms.

A reference in this paragraph 5.1 to a Shareholder includes a reference to the person or persons executing the Tender Form and in the event of more than one person executing a Tender Form, the provisions of this paragraph will apply to them jointly and to each of them.

Tenders through CREST – Representations and warranties

5.2 Each Shareholder who holds Shares in uncertificated form (i.e. in CREST) and by whom, or on whose behalf, a tender through CREST is made, irrevocably undertakes, represents, warrants and agrees to and with Cavendish (for itself and as trustee for the Company) (so as to bind him, his personal representatives, heirs, successors and assigns) that:
(a) the input of the TTE Instruction shall constitute an offer to sell to Cavendish the number of Shares specified in the TTE Instruction on and subject to the terms and conditions set out or referred to in this document, and that once the TTE Instruction has settled such tender shall be irrevocable;
(b) such Shareholder has full power and authority to tender, sell, assign or transfer the Shares in respect of which such offer is accepted (together with all rights attaching thereto) and, when the same are purchased by Cavendish, Cavendish will acquire such Shares with full title guarantee and free from all liens, charges, encumbrances, equitable interests, rights of pre-emption or other third party rights of any nature and together with all rights attaching

thereto on or after the Tender Closing Date, including the right to receive all dividends and other distributions declared, paid or made after that date (but, for the avoidance of doubt, Shareholders will not be eligible to receive either Dividend in respect of any Shares which are successfully tendered and repurchased under the Tender Offer);

(c) the input of the TTE Instruction will, subject to the Tender Offer becoming unconditional, constitute the irrevocable appointment of the Receiving Agent as such Shareholder's escrow agent and an irrevocable instruction and authority to the escrow agent, to transfer to itself and then to transfer to Cavendish by means of CREST (or to such person or persons as Cavendish may direct) all of the Relevant Shares (as defined below) accepted under the Tender Offer or where there are Shares which have not been successfully tendered under the Tender Offer, to transfer the Relevant Shares not successfully tendered to the original available balances from which those Shares came. For the purposes of this paragraph 5.2(c), "Relevant Shares" means Shares held in uncertificated form and in respect of which a transfer or transfers to escrow has or have been effected pursuant to the procedures described in this Part 4;
(d) such Shareholder agrees to ratify and confirm each and every act or thing which may be done or effected by Cavendish or the Receiving Agent or any of their respective directors or officers or any person nominated by Cavendish or the Receiving Agent in the proper exercise of its or his or her powers and/or authorities hereunder;
(e) such Shareholder shall do all such acts and things as shall be necessary or expedient and execute any additional documents deemed by Cavendish to be desirable, in each case to complete the purchase of the Shares and/or to perfect any of the authorities expressed to be given hereunder;
(f) if such Shareholder is an Overseas Shareholder, (a) he, she or it is not in any Restricted Territory or in any territory in which it is unlawful to make or accept the Tender Offer in any manner in which such person has used or will use it, (b) he, she or it has fully observed any applicable legal and regulatory requirements of the territory in which such Overseas Shareholder is resident or located, and (c) the invitation under the Tender Offer may lawfully be made to such Overseas Shareholder under the laws of the relevant jurisdiction;
(g) such Shareholder's offer to sell Shares to Cavendish, including the input of the TTE Instruction, and any acceptance thereof, shall not be unlawful under the laws of any jurisdiction;
(h) such Shareholder has not received or sent copies or originals of this document or any related documents in or to a Restricted Territory and has not otherwise utilised in connection with the Tender Offer, directly or indirectly, the mails or any means or instrumentality (including, without limitation, facsimile transmission, internet and telephone) of interstate or foreign commerce, or of any facility of a national securities exchange, of any Restricted Territory, and that such Shareholder is not accepting the Tender Offer from any Restricted Territory;
(i) the creation of a CREST payment in favour of such Shareholder's payment bank in accordance with the CREST payment arrangements as referred to in paragraph 4 above will, to the extent of the obligations so created, discharge fully any obligation of Cavendish to pay to such Shareholder the cash consideration to which he, she or it is entitled in the Tender Offer;
(j) the input of the TTE Instruction constitutes such Shareholder's submission to the jurisdiction of the courts of England in relation to all matters arising out of or in connection with the Tender Offer;
(k) if, for any reason any Shares in respect of which a TTE Instruction has been made are, prior to 13:00 hours on 19 November 2025, converted into certificated form, the tender(s) through CREST in respect of such Shares shall cease to be valid;
(l) if the appointment of the agent under sub-paragraph 5.2(c) above shall be unenforceable or invalid or shall not operate so as to afford to Cavendish or the Receiving Agent the benefit or authority expressed to be given therein, the Shareholder shall with all practicable
speed do all such acts and things and execute all such documents that may be required to enable Cavendish and/or the Receiving Agent to secure the full benefits of subparagraph 5.2(c) above; and
(m) such Shareholder shall not take any action which would prevent the Company or the Registrar from cancelling the Shares to which the TTE Instructions relate.

6 ADDITIONAL PROVISIONS

6.1 Each Eligible Shareholder may tender some of or all of their holding of Shares by the Tender Closing Date, subject to scaling down of tenders in excess of such Shareholders' Basic Entitlement in terms of this Part 4.
6.2 If a Shareholder holding a Share certificate does not return this by 13:00 hours on 19 November 2025, Cavendish may deem (in its absolute discretion) that such Shareholder has only tendered the number of Shares in respect of which Share certificates have been received.
6.3 Shares acquired by Cavendish under the Tender Offer will be on-market purchases in accordance with the rules of the London Stock Exchange.
6.4 Shares sold by Shareholders pursuant to the Tender Offer will be acquired with full title guarantee and free from all liens, charges, encumbrances, equitable interests, rights of pre-emption or other third party rights of any nature and together with all rights attaching thereto on or after the Tender Closing Date including the right to receive all dividends and other distributions declared, paid or made after that date.
6.5 Unless lapsed, suspended or terminated in accordance with the provisions of this Part 4, the Tender Offer will close at 13:00 hours on 19 November 2025 and it is expected that on 21 November 2025 the Company will make a public announcement of the total number of Shares tendered successfully.
6.6 Each Shareholder who tenders or procures the tender of Shares will thereby be deemed to have agreed that, in consideration of Cavendish agreeing to process their tender, such Shareholder will not revoke their tender or withdraw their Shares. Shareholders should note that once tendered, these Shares may not be sold, transferred, charged or otherwise disposed of.
6.7 Any omission to dispatch this document or the Tender Forms or any notice required to be dispatched under the terms of the Tender Offer to, or any failure to receive the same by, any person entitled to participate in the Tender Offer shall not invalidate the Tender Offer in any way or create any implication that the Tender Offer has not been made to any such person.
6.8 No acknowledgement of receipt of any Tender Form(s), TTE Instruction, Share certificate(s) and/ or document(s) of title will be given. All communications, notices, certificates, documents of title and remittances to be delivered by or sent to or from Shareholders (or their designated agents) will be delivered by or sent to or from such Shareholders (or their designated agents) at their own risk.
6.9 All powers of attorney and authorities on the terms conferred by or referred to in this Part 4 or in the Tender Form are given by way of security for the performance of the obligations or the Shareholders concerned and are irrevocable in accordance with section 4 of the Powers of Attorney Act 1971.
6.10 All tenders in respect of Shares in certificated form, subject to paragraphs 9, 10 and 11 below, must be made on the relevant prescribed Tender Forms, duly completed in accordance with the instructions set out thereon which constitute part of the terms of the Tender Offer. A tender in respect of Shares held in certificated form will only be valid when the procedures contained in the terms and conditions set out in this Part 4 and in the Tender Forms are complied with. The Tender Offer and all tenders will be governed by and construed in accordance with Scottish law. Delivery or posting of any of a Tender Form or the transmission of a TTE Instruction in CREST will constitute submission to the jurisdiction of the English courts.
6.11 If the Tender Offer does not become unconditional, lapses or is terminated, all documents lodged pursuant to the Tender Offer will be returned promptly by post, within 14 Business Days of the

later of the Tender Offer lapsing or terminating, to the person or agent whose name and address is set out in Box 1 or, if applicable, Box 3 of the Tender Form, if none is set out, to the tendering Shareholder or, in the case of joint holders, the first named at their registered address. In the case of Shares held in uncertificated form, the Registrar in their capacity as the escrow agent will, within 14 Business Days of the Tender Offer lapsing, give instructions to Euroclear to transfer all Shares held in escrow balances and in relation to which it is the escrow agent for the purposes of the Tender Offer by TFE Instruction to the original available balances from which those Shares came. In any of these circumstances the Tender Form will cease to have any effect.

6.12 In the case of Shares held in certificated form, the instructions, terms, provisions and authorities contained in or deemed to be incorporated in the Tender Form shall constitute part of the terms of the Tender Offer.
6.13 The definitions set out in this document apply to the terms and conditions set out in this Part 4.
6.14 Subject to paragraphs 9 and 10 below, the Tender Offer is open to Shareholders in respect of Shares held by them on the Tender Record Date, and will close at 13:00 hours on 19 November 2025. No Tender Form, Share certificate(s) and/or other document(s) of title or indemnity or TTE Instruction received after that time will be accepted, except at the sole discretion of Cavendish.
6.15 The decision of Cavendish as to which Shares have been successfully tendered shall be conclusive and binding on all Shareholders.
6.16 Further copies of this document and the Tender Forms may be obtained on request from the Registrar (in the case of registered Shareholders), at the addresses set out on the front of the Tender Forms or by telephoning them as described in paragraph 3.1 of this Part 4.

7 TERMINATION OF THE TENDER OFFER

7.1 If, at any time prior to Cavendish effecting the purchase as principal of the tendered Shares pursuant to the terms of the Repurchase Agreement,
(a) the Company (acting through the Directors) notifies Cavendish in writing that in the Directors' reasonable opinion the Tender Offer would no longer be in the interests of the Company and/or Shareholders; or
(b) in either Cavendish's and/or the Board's absolute determination, as a result of any change in national or international financial, economic, political or market conditions, the costs of the Tender Offer have become prohibitive; or
(c) in either Cavendish's and/or the Company's absolute determination the completion of the purchase of Shares in the Tender Offer could have unexpected adverse fiscal or other consequences (whether by reason of a change in legislation or practice or otherwise) for the Company or its Shareholders if the Tender Offer were to proceed,

Cavendish and/or the Company shall be entitled at its complete discretion by a public announcement to withdraw the Tender Offer, and in such event the Tender Offer shall cease and determine absolutely, without any liability on the part of the Company or Cavendish.

8 MISCELLANEOUS

8.1 Any suspension, extension or termination of the Tender Offer will be followed as promptly as practicable by a public announcement thereof not later than close of business on the Business Day following the date of such changes. Such an announcement will be notified to a Regulatory Information Service provider. References to the making of an announcement by the Company include the release of an announcement on behalf of the Company by Cavendish to the press and delivery of, by telephone or facsimile or other electronic transmission of, such announcement to a Regulatory Information Service.
8.2 Tendering Shareholders will not be obliged to pay brokerage fees, commissions or transfer taxes or stamp duty in the UK on the purchase by Cavendish of Shares pursuant to the Tender Offer.
8.3 Except as contained in this document, no person has been authorised to give any information or make any representations with respect to the Company or the Tender Offer and, if given or made, such other information or representations should not be relied on as having been authorised by Cavendish or the Company. Under no circumstances should the delivery of this document or the delivery of any consideration pursuant to the Tender Offer create any implication that there has been no change in the assets, properties, business or affairs of the Company since the date of this document.
8.4 Cavendish reserves the absolute right to inspect (either itself or through its agents) all Tender Forms and TTE Instructions and may consider void and reject any tender that does not in Cavendish' sole judgment (acting reasonably) meet the requirements of the Tender Offer. Cavendish reserves the absolute right to waive any defect or irregularity in the tender of any Shares, including any Tender Form or TTE Instruction (in whole or in part) which is not entirely in order or which is not accompanied by (in the case of Shares held in certificated form) the relevant Share certificate(s) and/or other document(s) of title or any indemnity acceptable to Cavendish in lieu thereof. In that event, the consideration under the Tender Offer will only be dispatched when the Tender Form or TTE Instruction (as appropriate) is entirely in order and (in the case of Shares held in certificated form) the Share certificate(s) and/or other document(s) of title or indemnities satisfactory to Cavendish have been received. None of Cavendish, the Company nor any other person will be under any duty to give notification of any defects or irregularities in tenders or incur any liability for failure to give any such notification. Cavendish also reserves the right to treat as valid Tender Forms or TTE Instructions received by the Receiving Agent after the deadline specified for receipt of Tender Forms and TTE Instructions.
8.5 Shares purchased pursuant to the Tender Offer will, following the completion of the Tender Offer, be acquired from Cavendish by the Company on the main market of the London Stock Exchange pursuant to the Repurchase Agreement and such Shares will be held in treasury.
8.6 The provisions of the Contracts (Rights of Third Parties) Act 1999 do not apply to this document.

9 OVERSEAS SHAREHOLDERS

9.1 The making of the Tender Offer in or to persons who are citizens or nationals of, or resident in, jurisdictions outside of the UK or custodians, nominees or trustees for citizens, nationals or residents of jurisdictions outside of the UK may be prohibited or affected by the laws of the relevant overseas jurisdiction. Shareholders who are Overseas Shareholders should inform themselves about and observe any applicable legal requirements. It is the responsibility of any such Shareholder wishing to tender Shares to satisfy himself as to the full observance of the laws of the relevant jurisdiction in connection therewith, including the obtaining of any governmental, exchange control or other consents which may be required, the compliance with other necessary formalities and the payment of any transfer or other taxes or other requisite payments due in such jurisdiction. Any such Shareholder will be responsible for payment of any such transfer or other taxes or other requisite payments due by whomsoever payable and Cavendish and the Company and any person acting on their behalf shall be fully indemnified and held harmless by such Shareholder for any such transfer or other taxes or other requisite payments such person may be required to pay. No steps have been taken to qualify the Tender Offer or to authorise the extending of the Tender Offer or the distribution of the Tender Forms in any territory outside the United Kingdom and, subject to paragraph 10 below, the United States.
9.2 In particular, the Tender Offer is not being offered, directly or indirectly, in or into, or by use of the mails, or by any means or instrument (including, without limitation, the internet, facsimile transmission, telex and telephone) or interstate or foreign commerce, or of any facility of a national securities exchange, of any Restricted Jurisdiction and the Tender Offer cannot be accepted by any such use, means, instrumentality or facility or from within any Restricted Jurisdiction. Accordingly, the Tender Forms and any related documents are not being and must not be mailed or otherwise distributed or sent in or into any Restricted Jurisdiction, including to Shareholders with registered addresses in any Restricted Jurisdiction or to persons whom Cavendish knows to be custodians, nominees or trustees holding Shares for persons in any Restricted Jurisdiction. Receipt of this document and/or Tender Forms will not constitute an offer in those jurisdictions in which it would be illegal to make such an offer and in those circumstances, this document and/ or Tender Forms will be deemed to have been sent for information only and should not be copied

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or redistributed. Persons receiving such documents or wishing to accept the Tender Offer should not distribute or send them in, into or from any Restricted Jurisdiction or use such mails or any such means, instrumentality or facility in connection with the Tender Offer and so doing will render invalid any related purported acceptance of the Tender Offer. All accepting Shareholders must provide addresses outside the Restricted Jurisdictions for the remittance of cash or the return of documents lodged pursuant to the Tender Offer. A Shareholder will be deemed not to have accepted the Tender Offer if:

(a) such Shareholder is unable to make any relevant representation and warranty set out in paragraph 5 of this Part 4;
(b) such Shareholder completes Box 1 of the Tender Forms with an address in any Restricted Jurisdiction; or
(c) the Tender Forms received from him is in an envelope postmarked in, or which otherwise appears to Cavendish or its agents to have been sent from any Restricted Jurisdiction.

Cavendish reserves the right, in its absolute discretion, to investigate, in relation to any acceptance, whether any relevant representation and warranty referred to in paragraph 5 of Part 4 of this document given by any Shareholder are correct and, if such investigation is undertaken and as a result Cavendish determines (for any reason) that any such representation and warranty is not correct, such acceptance shall not be valid.

9.3 If, in connection with making the Tender Offer notwithstanding the restrictions described above, any person (including, without limitation, custodians, nominees and trustees) whether pursuant to a contractual or legal obligation or otherwise, forwards this document, the Tender Forms or any related offering documents in, into or from any Restricted Jurisdiction or uses the mails of, or any means or instrumentality (including, without limitation, the internet, facsimile transmission, telex and telephone) of interstate or foreign commerce of, or any facility of a national securities exchange of, any Restricted Jurisdiction in connection with such forwarding, such persons should:
(a) inform the recipient of such fact;
(b) explain to the recipient that such action may invalidate any purported acceptance by the recipient; and
(c) draw the attention of the recipient to this paragraph 9.
9.4 The provisions of this paragraph 9 and any other terms of the Tender Offer relating to Overseas Shareholders may be waived, varied or modified as regards specific Shareholders or on a general basis by Cavendish in its absolute discretion but only if Cavendish is satisfied that such waiver, variance or modification will not constitute or give rise to a breach of applicable securities or other legal or regulatory requirements.
9.5 The provisions of this paragraph 9 supersede any terms of the Tender Offer inconsistent herewith.
9.6 Overseas Shareholders should inform themselves about and observe any applicable legal or regulatory requirements. The comments set out in this document are intended as a general guide only and Shareholders who are in any doubt about their position should consult their professional adviser in the relevant territory.

10 US SHAREHOLDERS

10.1 The receipt of cash pursuant to the Tender Offer may be a taxable transaction for US federal income tax purposes. In addition, holders may be subject to US backup withholding and information reporting on payments with respect to the Tender Offer made (or deemed made) within the United States. Each US Shareholder should consult and seek individual tax advise from an appropriate professional adviser.
10.2 The Tender Offer is being made to US Shareholders in compliance with the applicable US tender offer rules under the Exchange Act, including Regulation 14E thereunder and otherwise in accordance with the requirements of Scottish law, the London Stock Exchange and the FCA. Accordingly, the Tender Offer may be subject to disclosure and other procedural requirements,

including with respect to withdrawal rights, offer timetable, settlement procedures and timing of payments that are different from those applicable under US domestic tender offer procedures and law.

10.3 The attention of US Shareholders is drawn to the section titled "Notice For US Shareholders" on page 4 of this document.

11 MODIFICATIONS

The terms of the Tender Offer shall have effect subject to such non-material modifications or additions as the Company and Cavendish may from time to time approve in writing. The times and dates referred to in this document may be amended by agreement between the Company and Cavendish and any such amendment shall be publicly announced as promptly as practicable by way of a Regulatory Information Service.

RISK FACTORS

Shareholders should consider carefully all of the information set out in this document including, in particular, the risks associated with the Tender Offer described below, as well as their own personal circumstances, prior to making any decision as to whether or not to tender any Shares in the Tender Offer.

Additional risks and uncertainties which were not known to the Board at the date of this document or that the Board considers at the date of this document to be immaterial (based on the assumption that the Resolution is passed at the General Meeting and the Tender Offer is implemented) may also materially and adversely affect the Company's business, financial condition or results or prospects.

Shareholders should be aware of the following considerations relating to the Tender Offer:

Implementation of the Tender Offer is conditional, inter alia, upon the passing as a special resolution of the Resolution to be proposed at the General Meeting authorising the Company to make market purchases of Shares purchased pursuant to the Tender Offer and the Subsequent Tender Offer. In the event that the Resolution is not passed, or the Tender Offer does not proceed for any other reason, the Tender Offer and the Subsequent Tender Offer will not proceed and the Company would nevertheless have borne the abortive costs of having proposed the Tender Offer.
In order to pay the consideration to which Shareholders are entitled pursuant to valid tenders of Shares accepted by Cavendish (and which the Company will then be obliged to repurchase from Cavendish), it is expected that the Investment Manager will realise a proportion of the Company's investment portfolio and, in addition, that the Company will use available cash and other liquid funds. The realisation of the market value of an asset depends to a great extent on economic and other conditions beyond the control of the Company or the Investment Manager and, therefore, the price obtained for such sales may be lower than the current market value of the investments in question.
Shareholders tendering Shares for sale under the Tender Offer will receive the Tender Price per Share, which may be less than the price at which they bought their Shares or the price or value at which they might ultimately realise their Shares should they continue to hold them.
Tender Forms and TTE Instructions, once submitted, are irrevocable. Shareholders should note that all Shares tendered will be held in escrow by the Registrar and may not be switched, sold, transferred, charged or otherwise disposed of other than in accordance with the Tender Offer. The price of the Shares and the Company's Net Asset Value may rise or fall following submission of a Tender Form and/or TTE Instruction. If the Tender Offer lapses or is terminated in accordance with the terms and conditions set out in this document, all tendered Shares will be returned to the relevant Shareholders.
If any Shares permitted to be tendered pursuant to the Tender Offer are tendered, the issued share capital of the Company will be reduced as a result of the Tender Offer (and associated repurchase) and the Company will be smaller. As a result, the funds used to repurchase the Shares acquired by Cavendish pursuant to the Tender Offer will no longer be available for application in the ordinary course of the Company's business or to meet contingencies, and the fixed costs of the Company will be spread over fewer Shares.
The lower number of Shares in issue following completion of the Tender Offer may reduce secondary market liquidity in the Shares, which could, accordingly, adversely affect a Shareholder's ability to sell their Shares in the market.
There can be no guarantee that the investment objective of the Company will be achieved or that any appreciation of the Company's assets will occur.
The Company's past investment performance is not a reliable indicator of its future investment performance.
Changes in economic conditions (including, for example, changes in exchange rates, interest rates, rates of inflation, industry conditions and competition), political, diplomatic, social and demographic events and trends, tax laws and other factors could substantially and adversely affect the value of the Company's portfolio and, as a consequence, the Company's investment performance, share price, and prospects.
Any change in the Company's tax status, or in taxation legislation or in the interpretation or application of taxation legislation, could affect the value of investments held by the Company, the Company's ability to achieve its investment objective, the ability of the Company to provide returns to Shareholders and/or alter the post-tax returns of Shareholders. Shareholders should refer to the information contained in Part 6 of this document in relation to any UK tax consequences relating to the Tender Offer.

The foregoing factors are not exhaustive and do not purport to be a complete explanation of all risks and significant considerations relating to the Tender Offer and the Company. Accordingly, additional risks and uncertainties not presently known to the Board may also have an adverse effect on the Tender Offer and/or the Company's business, financial condition or results or prospects.

UK TAXATION IN RELATION TO THE TENDER OFFER

The following comments are intended only as a general guide to certain aspects of current UK law and HM Revenue & Customs ("HMRC") published practice and do not constitute tax advice. They are of a general nature and apply only to Shareholders who, for tax purposes, are resident solely in the UK (except where indicated) and who hold their Shares beneficially as an investment. They do not address the position of certain classes of Shareholders such as dealers in securities, persons who are exempt from taxation or persons who acquired their shares by virtue of any office or employment. Shareholders are advised to consult their own independent professional adviser as to the tax consequences of the proposals.

A Shareholder who sells Shares pursuant to the Tender Offer should be treated, for the purposes of UK taxation, as though the Shareholder had sold them to a third party in the open market. Accordingly, and subject to the comments below, any such Shareholder who is UK resident may, depending on that Shareholder's personal circumstances, be subject to capital gains tax (or, in the case of a corporate Shareholder, corporation tax on chargeable gains) in respect of any gain arising on such sale.

The general rule is that, for UK tax purposes, chargeable gains and allowable losses fall to be calculated in Sterling. Accordingly, where Shares are acquired and/or disposed of for non-Sterling consideration, a chargeable gain or allowable loss could arise by reference to exchange rate movements. For Shareholders that are companies within the charge to UK corporation tax, the extent to which this general rule applies may depend on what the company's functional currency is and whether any designated currency election has been made. Shareholders who are in any doubt as to the consequences for them of these rules should seek appropriate professional advice.

Shareholders who are not resident in the UK for taxation purposes will not normally be liable to UK taxation on chargeable gains arising from the sale of their Shares unless those Shares are held for the purposes of a trade, profession or vocation carried on by those Shareholders through a UK branch, agency or permanent establishment, although they may be subject to foreign taxation depending on their personal circumstances. Individual Shareholders who are only temporarily not resident in the UK for tax purposes may, depending on their personal circumstances, become liable to capital gains tax under tax anti-avoidance legislation and, therefore, should seek personal tax advice.

The UK tax code contains provisions which permit HMRC to counteract tax advantages arising from certain transactions in securities by (among other things) treating some or all of the proceeds of capital disposals as distributions of income. Generally speaking, however, these provisions should not apply where it can be shown that the transactions in question were entered into for genuine commercial reasons and did not involve as one of their main objects or purposes the obtaining of a tax advantage. Shareholders are advised to take independent advice as to the potential application of these provisions in the light of their own particular motives and circumstances. Application has not been made to HMRC for clearance as to these matters.

Stamp duty or stamp duty reserve tax at the rate of 0.5% of the Tender Price (rounded up to the nearest £5 (five pounds) in the case of stamp duty only) will be payable by the Company on Shares repurchased by it pursuant to the Tender Offer.

The information relating to taxation set out above is a general guide and is not exhaustive. It is based on law and published practice currently in force in the United Kingdom and is subject to changes therein (potentially with retrospective effect). If you are in any doubt as to your taxation position you should consult an appropriate professional adviser without delay.

ADDITIONAL INFORMATION

1 REPURCHASE AGREEMENT

1.1 The Company and Cavendish entered into a repurchase agreement on 20 October 2025 pursuant to which the Company has agreed, subject to the Tender Offer becoming unconditional in all respects and not being suspended or terminated, to purchase from Cavendish, on the London Stock Exchange, such number of Shares as Cavendish shall purchase pursuant to the Tender Offer, at an aggregate price equal to the amount paid by Cavendish for its purchase of the tendered Shares. The Tender Offer may be terminated if any of the circumstances set out in paragraph 7 of Part 4 of this document has arisen or in the event that the Repurchase Agreement is terminated in accordance with its terms.
1.2 In acquiring Shares pursuant to valid tenders made under the Tender Offer and in selling such Shares to the Company, Cavendish will act as principal.
1.3 The Repurchase Agreement contains certain representations, warranties and undertakings from Cavendish in favour of the Company concerning its authority to enter into the Repurchase Agreement and suitability to make the purchase of Shares pursuant thereto.
1.4 The Repurchase Agreement also contains representations and warranties from the Company in favour of Cavendish and incorporates an indemnity in favour of Cavendish in respect of any liability which it or any of its associates may suffer in relation to its performance under the Tender Offer, subject to standard exclusions.
1.5 The Repurchase Agreement, which is stated not to create a relationship of agency between Cavendish and the Company, is governed by and construed in accordance with English law.

2 CONSENT

Cavendish, which is authorised and regulated in the UK by the FCA, has given and not withdrawn its written consent to the issue of this document with its letter and with the references to its name in the form and context in which they are included.

DEFINITIONS

Articles of Association the articles of association of the Company;

Available Shares 7,409,587 Shares available to be acquired under the

Tender Offer and representing 5% of the Shares in issue (excluding Shares held in treasury) as at the Latest

Practicable Date;

Basic Entitlement 5% of Eligible Shareholders' Shares registered in their

name on the Register as at the Tender Record Date;

Biannual Tender Offer Facility has the meaning given in paragraph 1 of Part 1 of this

document;

Benchmark the MSCI Europe ex-UK SmallCap Index (in Sterling

terms);

Business Day any day other than a Saturday, Sunday or public holiday

in the UK on which clearing banks in the UK are open for

general banking business;

Calculation Date 28 November 2025;

Cavendish Cavendish Capital Markets Limited;

Companies Act the Companies Act 2006 (as amended);

Company Montanaro European Smaller Companies Trust plc, a

public limited company incorporated under the laws of

Scotland with registered number SC074677;

CREST the computer-based system and related facilities and

procedures operated by Euroclear;

CREST member a person who has been admitted by Euroclear as a system

member (as defined in the Regulations);

CREST participant a person who has been admitted by Euroclear as a

participant (as defined in the Regulations);

CREST Proxy Instruction a proxy instruction message submitted through CREST in

accordance with the CREST Manual;

CREST sponsor a CREST participant admitted to CREST as a CREST

sponsor being a sponsoring system participant (as defined

in the Regulations);

CREST sponsored member a CREST member admitted to CREST as a sponsored

Member;

Directors or Board the directors of the Company, whose names appear in

Part 1 of this document;

Dividends together, the Third 2025 Dividend and the First 2026

Dividend;

Eligible Shareholders Shareholders (other than Restricted Shareholders) on

the Register at the Tender Record Date and, in the case of US Shareholders only, persons who are Qualifying

US Shareholders;

Equiniti Equiniti Limited;

Euroclear Euroclear UK & International Limited, being the operator

of CREST;

European LargeCap or LargeCap companies comprising the MSCI Europe (ex UK) LargeCap

index (in Sterling terms);

European Smallcap or SmallCap companies comprising the Benchmark;

Excess Application an Eligible Shareholder tendering more than their Basic

Entitlement;

Exchange Act the United States Securities Exchange Act of 1934, as

amended from time to time;

Exit Shares a Share which has been successfully tendered for

purchase pursuant to the terms of the Tender Offer;

FCA the Financial Conduct Authority of the United Kingdom

including any replacement or substitute thereof, and any regulatory body or person succeeding, in whole or in part,

to the functions thereof;

First 2026 Dividend the Company's first interim dividend for the year ending

31 March 2026;

Form of Proxy the personalised form of proxy provided with this document

for use by Shareholders in connection with the General

Meeting;

FSMA the Financial Services and Markets Act 2000 (as

amended);

General Meeting the general meeting of the Company convened for

10:00 hours on 19 November 2025 or any adjournment thereof, notice of which is set out at the end of this

document;

Investment Manager or MAM Montanaro Asset Management Limited;

Latest Practicable Date 16 October 2025, being the latest practicable date prior

to the publication of this document for the purposes of

including certain information;

London Stock Exchange London Stock Exchange Plc;

NAV or Net Asset Value the net asset value of the Company determined in

accordance with the Company's normal accounting

policies;

Overseas Shareholders Shareholders who are resident in or citizens of, territories

outside the UK and not resident in, or citizens of, any of

the Restricted Jurisdictions;

Qualifying US Shareholders a person in the United States with whom Cavendish

may transact in accordance with Rule 15a-6 under the

Exchange Act;

Register the register of members of the Company;

Registrar or Receiving Agent Equiniti Limited;

Regulatory Information Service a service approved by the London Stock Exchange for the

distribution to the public of announcements;

Repurchase Agreement the repurchase agreement dated 20 October 2025

between the Company and Cavendish;

Resolution the special resolution to implement the Tender Offer, and

the Subsequent Tender Offer, of the Company, which will be proposed at the General Meeting and the details of which are contained in the Notice of General Meeting;

Restricted Jurisdiction any of Australia, Canada, Japan, New Zealand, the

Republic of South Africa, any member state of the European Economic Area and any other jurisdiction into which the making of the Tender Offer would constitute a

violation of the laws of such jurisdiction;

Restricted Shareholders Shareholders who are resident in, or citizens of, one of the

Restricted Jurisdictions;

SEC the US Securities and Exchange Commission;

Shareholders holders of Shares;

Shares ordinary shares of nominal value £0.05 each in the capital

of the Company;

Sterling the lawful currency of the United Kingdom;

Subsequent Tender Offer has the meaning given in paragraph 2 of Part 1 of this

document;

Tender Closing Date 13:00 hours on 19 November 2025 being the final date on

which the Tender Form may be received and the date on which the Tender Offer closes to Eligible Shareholders;

Tender Form the tender form accompanying this document for use by

Shareholders who hold their Shares in certificated form in

connection with the Tender Offer;

Tender Offer the invitation by Cavendish to Eligible Shareholders to

tender Shares on the terms and subject to the conditions set out in this document and, in the case of Shares held in

certificated form, the Tender Form;

Tender Price the price at which Shares will be purchased pursuant to

the Tender Offer as determined in accordance with the terms and conditions of the Tender Offer and as set out in

Part 3 of this document;

Tender Record Date 18:00 hours on 19 November 2025;

TFE Instruction a transfer from escrow instruction;

Third 2025 Dividend the Company's third interim dividend for the year ended

31 March 2025;

TTE Instruction a transfer to escrow instruction;

UK the United Kingdom of Great Britain and Northern Ireland;

UK Listing Rules the listing rules of the FCA;

United States or US the United States of America, its territories and possessions,

any state of the United States of America, the District of Columbia and all other areas subject to its jurisdiction; and

US Shareholder Shareholders who are located in the United States.

NOTICE OF GENERAL MEETING

MONTANARO EUROPEAN SMALLER COMPANIES TRUST PLC

(Incorporated and registered in Scotland with registered number SC074677. An investment company within the meaning of Section 833 of the Companies Act 2006)

Notice is hereby given that a general meeting (the "General Meeting") of Montanaro European Smaller Companies Trust plc (the "Company") will be held at the offices of Juniper Partners Limited at 28 Walker Street, Edinburgh, EH3 7HR at 10:00 hours on 19 November 2025 to consider and, if thought fit, approve the following resolution which will be proposed as a special resolution.

The resolution would allow the Company to buy back up to 14,819,174 Shares in order to effect the Tender Offer and the Subsequent Tender Offer.

SPECIAL RESOLUTION

THAT, (i) in addition to the existing authority to make market purchases of Shares pursuant to Resolution 12 passed at the Company's annual general meeting held on 4 September 2025, but without prejudice to the exercise of any such authority prior to the date of the passing of this resolution, and (ii) in substitution for the authority to make market purchases of Shares pursuant to Resolution 2 passed at the general meeting of the Company held on 15 May 2025, the Company be and is hereby generally and unconditionally authorised in accordance with Section 701 of Companies Act to make market purchases (as defined in Section 693(4) of the Companies Act) of Shares pursuant to one or more tender offers to be made by Cavendish Capital Markets Limited, provided that:

(a) the maximum aggregate number of Shares which may be repurchased by the Company is 14,819,174;
(b) the price which may be paid for a Share pursuant to any such tender offer shall be an amount equivalent to 95 per cent. of the net asset value per Share (audited or unaudited) as at close of business on the relevant published tender offer price calculation date applicable to such tender offer, calculated in accordance with the Company's normal accounting policies and expressed in pence Sterling to four decimal places with 0.00005 pence being rounded downwards, which price shall be both the maximum and the minimum prices for the purposes of Section 701 of the Companies Act; and
(c) unless previously renewed, varied or revoked, this authority shall expire at the conclusion of the Annual General Meeting of the Company to be held in 2026 or, if earlier, on 30 September 2026 save that the Company may before such expiry enter into a contract to purchase Shares which will or may be completed wholly or partly after such expiry and a purchase of Shares may be made pursuant to any such contract.

BY ORDER OF THE BOARD Registered Office of the Company:

Juniper Partners Limited 28 Walker Street Company Secretary Edinburgh

EH3 7HR

Date: 20 October 2025

Notes:

1. Attending the General Meeting in Person

If you wish to attend the General Meeting in person, you should arrive at the venue for the General Meeting in good time to allow your attendance to be registered. It is advisable to have some form of identification with you as you may be asked to provide evidence of your identity prior to being admitted to the General Meeting.

2. Appointment of Proxies

Members are entitled to appoint one or more proxies to exercise all or any of their rights to attend, speak and vote at the General Meeting. A proxy need not be a member of the Company but must attend the General Meeting to represent a member. To be validly appointed a proxy must be appointed using the procedures set out in these notes and in the notes to the accompanying Form of Proxy.

If members wish their proxy to speak on their behalf at the meeting, members will need to appoint their own choice of proxy (not the Chairman of the General Meeting) and give their instructions directly to them.

Members can only appoint more than one proxy where each proxy is appointed to exercise rights attached to different shares. Members cannot appoint more than one proxy to exercise the rights attached to the same share(s). If a member wishes to appoint more than one proxy, they should contact Equiniti Limited (the "Registrar") on +44 (0) 371 384 2461. Lines are open from 8.30 a.m. to 5.30 p.m., Monday to Friday excluding public holidays in England and Wales. If calling from outside of the UK, please ensure the country code is used. A member may instruct their proxy to abstain from voting on the resolution to be considered at the meeting by marking the 'Abstain' option when appointing their proxy. It should be noted that an abstention is not a vote in law and will not be counted in the calculation of the proportion of votes 'For' or 'Against' the resolution.

Completion and return of the Form of Proxy will not prevent a member from attending the General Meeting and voting in person if he or she wishes.

A person who is not a member of the Company but who has been nominated by a member to enjoy information rights does not have a right to appoint any proxies under the procedures set out in these notes and should read note 8 below.

You can appoint a proxy electronically by accessing www.shareview.co.uk where full instructions on the procedure are given.

As an alternative to completing this hard-copy proxy form, you can appoint a proxy electronically at www.shareview.co.uk and logging in to your Shareview Portfolio. Click on the link to vote and follow the on-screen instructions. If you have not yet registered for a Shareview Portfolio, please go to www.shareview.co.uk and enter the requested information. For an electronic proxy appointment to be valid, the Registrar must receive it no later than 10:00 hours on 17 November 2025.

Should you complete your Form of Proxy electronically and then post a hard copy, the Form that arrives last will be counted to the exclusion of instructions received earlier, whether electronic or postal. Please refer to the terms and conditions of the service on the website.

3. Appointment of a Proxy Using a Form of Proxy

A Form of Proxy for use in connection with the General Meeting is enclosed. To be valid, any Form of Proxy or other instrument appointing a proxy, together with any power of attorney or other authority under which it is signed or a certified copy thereof, must be received by post at the Registrar at Equiniti, Aspect House, Spencer Road, Lancing BN99 6DA no later than 48 hours (excluding non-working days) before the time of the General Meeting or any adjournment of that meeting. Alternatively, you can vote or appoint a proxy electronically by visiting www.shareview.co.uk.

If you do not have a Form of Proxy and believe that you should have one, or you require additional Form of Proxy, please contact the Registrar on +44 (0) 371 384 2461. Lines are open from 8.30 a.m. to 5.30 p.m., Monday to Friday excluding public holidays in England and Wales. If calling from outside of the UK, please ensure the country code is used.

4. Appointment of a Proxy Through CREST

CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so by using the procedures described in the CREST Manual and by logging on to the following website: www.euroclear.com. CREST personal members or other CREST sponsored members, and those CREST members who have appointed (a) voting service provider(s), should refer to their CREST sponsor or voting service provider(s) who will be able to take the appropriate action on their behalf.

In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message (a "CREST Proxy Instruction") must be properly authenticated in accordance with Euroclear UK & International Limited's specifications, and must contain the information required for such instruction, as described in the CREST Manual. The message, regardless of whether it constitutes the appointment of a proxy or is an amendment to the instruction given to a previously appointed proxy, must in order to be valid, be transmitted so as to be received by the Registrar (ID RA19) no later than 48 hours (excluding nonworking days) before the time of the General Meeting or any adjournment of that meeting. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST Application Host) from which the Registrar is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST.

After this time any change of instructions to proxies appointed through CREST should be communicated to the appointee through other means. CREST members and, where applicable, their CREST sponsors or voting service provider(s) should note that Euroclear UK & International Limited does not make available special procedures in CREST for any particular message. Normal system timings and limitations will, therefore, apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal member, or sponsored member, or has appointed a voting service provider(s), to procure that his/her CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting system providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings. The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001.

Proxymity Voting – if you are an institutional investor, you may be able to appoint a proxy electronically via the Proxymity platform, a process which has been agreed by the Company and approved by the Registrar. For further information regarding Proxymity, please go to www.proxymity.io. Your proxy must be lodged by 10:00 hours on 17 November 2025 in order to be considered valid, if the meeting is adjourned, by the time which is 48 hours before the time of the adjourned meeting. Before you can appoint a proxy via this process you will need to have agreed to Proxymity's associated terms and conditions. It is important that you read these carefully as you will be bound by them, and they will govern the electronic appointment of your proxy. An electronic proxy appointment via the Proxymity platform may be revoked completely by sending an authenticated message via the platform instructing the removal of your proxy vote.

5. Appointment of Proxy by Joint Holders

In the case of joint holders, where more than one of the joint holders purports to appoint one or more proxies, only the purported appointment submitted by the most senior holder will be accepted. Seniority is determined by the order in which the names of joint holders appear in the Company's register of members in respect of the joint holding (the first named being the most senior).

6. Corporate Representatives

Any corporation which is a member can appoint one or more corporate representatives. Members can only appoint more than one corporate representative where each corporate representative is appointed to exercise rights attached to different shares. Members cannot appoint more than one corporate representative to exercise the rights attached to the same share(s).

7. Entitlement to Attend and Vote

Pursuant to regulation 41 of the Uncertificated Securities Regulations 2001, to be entitled to attend and vote at the General Meeting (and for the purpose of determining the votes they may cast), members must be registered in the Company's register of members at 18:30 hours on 19 November 2025 (or, if the General Meeting is adjourned, at 18:30 hours on the day two days prior to the adjourned meeting). Changes to the register of members after the relevant deadline will be disregarded in determining the rights of any person to attend and vote at the General Meeting.

8. Nominated Persons

Any person to whom this notice is sent who is a person nominated under section 146 of the Companies Act 2006 (the "Act") to enjoy information rights (a "Nominated Person") may, under an agreement between him/her and the member by whom he/she was nominated, have a right to be appointed (or to have someone else appointed) as a proxy for the General Meeting. Nominated Person has no such proxy appointment right or does not wish to exercise it, he/she may, under any such agreement, have a right to give instructions to the member as to the exercise of voting rights.

9. Website Giving Information Regarding the General Meeting

Information regarding the General Meeting, including information required by section 311A of the Act, and a copy of this notice of General Meeting is available from www.montanaro.co.uk/trust/mesct.

10. Voting Rights

As at 16 October 2025 (being the latest practicable date prior to the publication of this Notice of General Meeting) the Company had 189,427,600 Shares in issue of 5 pence each, with 41,235,860 Shares held in treasury. Each share (other than those held in treasury) carries one vote. The total voting rights in the Company as at 16 October 2025 were 148,191,740 votes.

11. Notification of Shareholdings

If the Chairman, as a result of any proxy appointments, is given discretion as to how the votes subject of those proxies are cast and voting rights in respect of those discretionary proxies, when added to the interest in the Company's securities already held by the Chairman, result in the Chairman holding such number of voting rights that she or he has a notifiable obligation under the Disclosure Guidance and Transparency Rules, the Chairman will make the necessary notifications to the Company and the Financial Conduct Authority. As a result, any member holding 3% or more of the voting rights in the Company, who grants the Chairman a discretionary proxy in respect of some or all of those voting rights and so would otherwise have a notification obligation under the Disclosure Guidance and Transparency Rules, need not make a separate notification to the Company and the Financial Conduct Authority.

12. Further Questions and Communication

Under section 319A of the Act, the Company must cause to be answered any question relating to the business being dealt with at the General Meeting put by a member attending the meeting unless answering the question would interfere unduly with the preparation for the meeting or involve the disclosure of confidential information, or the answer has already been given on a website in the form of an answer to a question, or it is undesirable in the interests of the Company or the good order of the meeting that the question be answered. Members who have any queries about the General Meeting should contact the Company Secretary, Juniper Partners Limited at 28 Walker Street, Edinburgh EH3 7HR. Members may not use any electronic address (within the meaning of Section 333(4) of the Act) provided in either this Notice of General Meeting or in any related documents (including the Form of Proxy) to communicate with the Company for any purpose other than those expressly stated.

13. Personal data

Personal data provided by Shareholders at or in relation to the General Meeting will be processed in line with the Company's privacy policy.

AI Terminal

MONTANARO EUROPEAN SMALLER C.TSTPLC

5187_rns_2025-11-19_03a0a11d-985c-4a1e-b3e1-7700169da2f2.pdf

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

MONTANARO EUROPEAN SMALLER COMPANIES TRUST PLC

TENDER OFFER TO PURCHASE UP TO 5% OF THE ISSUED SHARE CAPITAL OF THE COMPANY

APPROVAL OF THE BUY BACK AUTHORITY

AND

NOTICE OF GENERAL MEETING

Tender Offer

SHAREHOLDERS WHO DO NOT WISH TO TENDER THEIR SHARES IN THE COMPANY SHOULD NOT COMPLETE OR RETURN A TENDER FORM OR SUBMIT A TTE INSTRUCTION IN CREST.

General Meeting

CONTENTS

NOTICE FOR US SHAREHOLDERS

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

PART 1

LETTER FROM THE CHAIRMAN

MONTANARO EUROPEAN SMALLER COMPANIES TRUST PLC

1 INTRODUCTION

2 BACKGROUND TO THE PROPOSALS

3 THE COMPANY

3.1 Performance history

3.2 Dividends

3.3 Outlook

4 FURTHER INFORMATION ON THE TENDER OFFER

5 OVERSEAS SHAREHOLDERS

6 US SHAREHOLDERS

7 TAXATION

8 COSTS AND EXPENSES

9 GENERAL MEETING

10 ACTION TO BE TAKEN

10.1 Voting

10.2 Tender Form

11 RECOMMENDATION

PART 2

LETTER FROM CAVENDISH CAPITAL MARKETS LIMITED

TENDER OFFER

1 CONDITIONS OF THE TENDER OFFER

2 PROCEDURE FOR TENDERING SHARES

3 ELIGIBLE SHAREHOLDERS

3.1 Shares held in certificated form

3.2 Shares held in uncertificated form

4 TRANSFER OF TENDERED SHARES

5 VALIDITY OF TENDER FORMS

6 RESTRICTED SHAREHOLDERS AND OTHER OVERSEAS SHAREHOLDERS

7 US SHAREHOLDERS

8 SETTLEMENT

9 FURTHER INFORMATION

PART 3

FURTHER INFORMATION ON THE TENDER OFFER

1 CALCULATION OF TENDER PRICE

2 EXCESS APPLICATIONS

3 GENERAL

PART 4

TERMS AND CONDITIONS OF THE TENDER OFFER

1 TENDERS

2 CONDITIONS

3 PROCEDURE FOR TENDERING SHARES

3.1 Completion of Tender Form

3.2 Return of Tender Form – Shareholders

(a) Shares held in certificated form (that is, not in CREST)

(b) Shares held in CREST

(c) Deposits of Shares into, and withdrawals of Shares from, CREST

3.3 Validity of Tender Forms

Tenders from the United States will be accepted only from Qualifying US Shareholders.

4 SETTLEMENT

(a) Shares held in certificated form (that is, not in CREST)

(b) Shares held in CREST

5 REPRESENTATIONS AND WARRANTIES

Tender Form – Representations and warranties

Tenders through CREST – Representations and warranties

6 ADDITIONAL PROVISIONS

7 TERMINATION OF THE TENDER OFFER

8 MISCELLANEOUS

9 OVERSEAS SHAREHOLDERS

10 US SHAREHOLDERS

11 MODIFICATIONS

RISK FACTORS

UK TAXATION IN RELATION TO THE TENDER OFFER

ADDITIONAL INFORMATION