THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to what action you should take you are recommended to seek your own financial advice immediately from an independent financial adviser who specialises in advising on shares or other securities and who is authorised under the Financial Services and Markets Act 2000 (as amended) ("FSMA") or, if you are not resident in the UK, from another appropriately authorised independent financial adviser in your own jurisdiction.

This Prospectus comprises a prospectus relating to Nippon Active Value Fund plc (the "Company") in connection with the issue of Ordinary Shares and/or C Shares in the Company, prepared in accordance with the Prospectus Regulation Rules of the Financial Conduct Authority made pursuant to section 73A of FSMA. This Prospectus has been approved by the Financial Conduct Authority for the purposes of the UK version of Regulation (EU) 2017/1129 which forms part of UK law by virtue of the European Union (Withdrawal) Act 2018. The Financial Conduct Authority only approves this Prospectus, as the competent authority under the Prospectus Regulation Rules, as meeting the standards of completeness, comprehensibility and consistency imposed by the UK version of Regulation (EU) 2017/1129. Such approval should not be considered as an endorsement of the Company that is the subject of this Prospectus or of the quality of the Shares (as defined below). Investors should make their own assessment as to the suitability of investing in the securities.

Potential investors are recommended to seek advice from their stockbroker, bank manager, solicitor, accountant or other independent financial adviser duly authorised under FSMA if you are in the United Kingdom or, if not, from another appropriately authorised independent adviser before investing in the Company. Potential investors should read the entire Prospectus and, in particular, consider the risk factors relating to the Company set out on pages 13 to 23 of this Prospectus.

NIPPON ACTIVE VALUE FUND PLC

(Incorporated and registered in England and Wales with registered number 12275668 and registered as an investment company under section 833 of the Companies Act 2006 (as amended))

Initial Placing, Offer for Subscription and Intermediaries Offer of up to 150 million C Shares or Ordinary Shares

and

Placing Programme of up to 300 million Ordinary Shares and/or C Shares (inclusive of any Ordinary or C Shares issued under the Initial Placing, Offer for Subscription and Intermediaries Offer)

and

Admission to trading on the Specialist Fund Segment

Investment Adviser

Rising Sun Management Ltd.

Financial Adviser and Sole Bookrunner

Shore Capital

The Company, whose registered office appears on pages 37 and 95 of this Prospectus, and the Directors, whose names appear on pages 37 and 47-48 of this Prospectus, accept responsibility for the information contained in this Prospectus. To the best of the knowledge of the Company and the Directors, the information contained in this Prospectus is in accordance with the facts and the Prospectus contains no omissions likely to affect the import of such information.

Application will be made to the London Stock Exchange for any Ordinary Shares and C Shares issued pursuant to this Prospectus to be admitted to the Specialist Fund Segment of the Main Market of the London Stock Exchange. It is expected that First Admission will occur, and that unconditional dealings in New Shares issued pursuant to the Initial Placing, Offer for Subscription and Intermediaries Offer will commence, at 8:00 a.m. on or around 25 November 2021. The International Security Identification Number ("ISIN") for the C Shares to be admitted to trading in connection with the Issue is: GB00BKLGLT27. The ISIN for the Ordinary Shares to be admitted to trading

The Directors have reserved the right, in consultation with Shore Capital, to increase the size of the Issue by up to 150 million New Shares if overall demand exceeds 150 million New Shares. Any such increase will be announced through an RNS announcement.

in connection with the Issue and/or Placing Programme is: GB00BKLGLS10. The ISIN for any tranches of C Shares to be issued by the Company under the Placing Programme will be published by the Company at the appropriate time.

Neither the Ordinary Shares nor the C Shares are dealt in on any other Recognised Investment Exchange and no other such applications have been made or are currently expected.

The Specialist Fund Segment securities are not admitted to the Official List of the Financial Conduct Authority. Therefore the Company has not been required to satisfy the eligibility criteria for admission to listing on the Official List and is not required to comply with the Financial Conduct Authority's Listing Rules. The London Stock Exchange has not examined or approved the contents of this document.

The Specialist Fund Segment is intended for institutional, professional, professionally advised and knowledgeable investors who understand, or who have been advised of, the potential risk of investing in companies admitted to the Specialist Fund Segment. Further, the Ordinary Shares and C Shares (together, the "Shares") are only suitable for investors: (i) who understand and are willing to assume the potential risks of capital loss; (ii) for whom an investment in the Shares is part of a diversified investment programme; and (iii) who fully understand and are willing to assume the risks involved in such investment. It should be remembered that the price of the Shares can go down as well as up and that investors may not receive, on the sale or cancellation of the Shares, the amount that they invested. If you are in any doubt about the contents of this Prospectus, you should consult your accountant, legal or professional adviser or financial adviser.

Shore Capital, which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively for the Company and for no one else in relation to First Admission, the Initial Placing, the Offer for Subscription, each Programme Admission and the Placing Programme and the other arrangements referred to in this Prospectus. Shore Capital will not regard any other person (whether or not a recipient of this Prospectus) as its client in relation to First Admission, the Initial Placing, the Offer for Subscription, the Intermediaries Offer, each Programme Admission or the Placing Programme and the other arrangements referred to in this Prospectus and will not be responsible to anyone other than the Company for providing the protections afforded to its clients or for providing any advice in relation to First Admission, the Initial Placing, the Offer for Subscription, each Programme Admission or the Placing Programme the contents of this Prospectus or any transaction or arrangement referred to in this Prospectus. Apart from the responsibilities and liabilities, if any, which may be imposed on Shore Capital by FSMA or the regulatory regime established thereunder, Shore Capital does not make any representation express or implied in relation to, nor accepts any responsibility whatsoever for, the contents of the Prospectus or any other statement made or purported to be made by it or on its behalf in connection with the Company, the Shares, the First Admission, the Initial Placing, the Offer for Subscription, the Intermediaries Offer, each Programme Admission or the Placing Programme. Shore Capital (and its affiliates) accordingly, to the fullest extent permissible by law, disclaims all and any responsibility or liability (save for any statutory liability) whether arising in tort, contract or otherwise which it might have in respect of the contents of the Prospectus or any other statement made or purported to be made by it or on its behalf in connection with the Company, the Shares, First Admission, the Initial Placing, the Offer for Subscription, the Intermediaries Offer, each Programme Admission and the Placing Programme.

Intermediaries Offer

The Company consents to the use of this Prospectus in connection with any subsequent resale or final placement of securities by Intermediaries in the United Kingdom on the following terms: (i) in respect of Intermediaries who are appointed by the Company prior to the date of this Prospectus, from the date of this Prospectus; and (ii) in respect of Intermediaries who are appointed by the Company after the date of this Prospectus, from the date on which they are appointed to participate in the Intermediaries Offer and agree to adhere to and be bound by the Intermediaries Terms and Conditions, in each case until the closing of the Intermediaries Offer. The offer period within which any subsequent resale or final placement of securities by Intermediaries can be made and for which consent to use this Prospectus is given commences on 28 October 2021 and closes at 12 p.m. on 22 November 2021, unless closed prior to that date (any such prior closure to be announced via a Regulatory Information Service). The Company and the Directors accept responsibility for the information contained in this Prospectus with respect to any purchaser of New Shares pursuant to the Intermediaries Offer. Any Intermediary that uses this Prospectus must state on its website that it uses this Prospectus in accordance with the Company's consent and the conditions attached thereto. Intermediaries are required to provide the terms and conditions of the Intermediaries Offer at the time of such offer to any prospective investor who has expressed an interest in participating in the Intermediaries Offer to such Intermediary. Any application made by investors to any Intermediary is also subject to the terms and conditions imposed by such Intermediary.

Overseas Shareholders

The distribution of this Prospectus in certain jurisdictions may be restricted by law. No action has been taken by the Company or Shore Capital that would permit an offer of the Shares or possession or distribution of this Prospectus or any other offering or publicity material in any jurisdiction where action for that purpose is required, other than in the United Kingdom. Persons into whose possession this Prospectus comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

The Shares described in this Prospectus have not been, and will not be, registered under the relevant securities laws of any EEA State (other than any EEA member state where the Shares are lawfully marketed), Canada, Australia, the Republic of South Africa or Japan or their respective territories or possessions. Accordingly, the Shares may not (unless an exemption from such legislation or such laws is available) be offered, sold or delivered, directly or indirectly, in or into any EEA State (other than any EEA member state where the Shares are lawfully marketed), Canada, Australia, the Republic of South Africa or Japan or their respective territories or possessions.

The Shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") or with any securities regulatory authority of any state or other jurisdiction of the United States and the Shares may not be offered, sold, resold, transferred or delivered, directly or indirectly, within the United States or to, or for the account or benefit of, U.S. persons (as defined in Regulation S under the Securities Act) ("U.S. Persons"). There will be no public offer of the Shares in the United States. The Shares are being offered and sold solely (i) outside the United States to persons who are not U.S. Persons in "offshore transactions" as defined in and pursuant to Regulation S under the Securities Act ("Regulation S"); and (ii) within the United States to, or to U.S. Persons that are, both "qualified institutional buyers" ("QIBs") as defined in Rule 144A under the Securities Act and "qualified purchasers" ("QPs") as defined in Section 2(a)(51) of the U.S. Investment Company Act of 1940, as amended (the "Investment Company Act") pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

The Company will not be registered under the Investment Company Act and investors will not be entitled to the benefits of such legislation. Persons resident in territories other than the United Kingdom should consult their professional advisers as to whether they require any governmental or other consents or need to observe any formalities to enable them to apply for, acquire, hold or dispose of the Shares.

In particular, the attention of persons resident in the United States, any EEA State (other than any EEA member state where the Shares are lawfully marketed), Canada, Australia, the Republic of South Africa or Japan is drawn to paragraph 12 of Part 2 (Important Information) of this Prospectus. This Prospectus does not constitute an offer to sell or issue or the solicitation of an offer to buy or subscribe for Shares in any jurisdiction in which such offer or solicitation is unlawful.

28 October 2021

		Page
PROSPECTUS REGULATION SUMMARY		5
PART 1	RISK FACTORS	13
PART 2	IMPORTANT INFORMATION	24
PART 3	VOLUNTARY COMPLIANCE WITH THE LISTING RULES	33
PART 4	EXPECTED TIMETABLE, STATISTICS AND DEALING CODES	35
PART 5	DIRECTORS, INVESTMENT ADVISER AND ADVISERS	37
PART 6	INFORMATION ON THE COMPANY	39
PART 7	DIRECTORS, MANAGEMENT AND ADMINISTRATION	47
PART 8	INVESTMENT APPROACH, STRATEGY AND PROCESS	61
PART 9	CURRENT PORTFOLIO	71
PART 10	FINANCIAL INFORMATION	74
PART 11	THE ISSUE	77
PART 12	PLACING PROGRAMME	84
PART 13	UNITED KINGDOM AND JAPANESE TAXATION	90
PART 14	GENERAL INFORMATION	95
PART 15	DEFINITIONS AND INTERPRETATION	122
PART 16	TERMS AND CONDITIONS OF APPLICATION UNDER THE INITIAL PLACING AND THE PLACING PROGRAMME	129
PART 17	TERMS AND CONDITIONS OF APPLICATION UNDER THE OFFER FOR SUBSCRIPTION	140
APPENDIX 1	OFFER FOR SUBSCRIPTION APPLICATION FORM	151
APPENDIX 2	GIPS Dalton Japan Long Only Presentation	158
ANNEX AIFM DIRECTIVE DISCLOSURES		160

PROSPECTUS REGULATION SUMMARY

INTRODUCTION AND WARNINGS

The name of the issuer is Nippon Active Value Fund plc (the “Company”). The Company’s legal entity identifier is 213800JOFEGZJYS21P75 and its registered office is at 1st Floor, Senator House, 85 Queen Victoria Street, London, England, EC4V 4A.

The International Security Identification Number (“ISIN”) for the C Shares to be admitted to trading in connection with the Issue is GB00BKLGLT27. The ISIN for the Ordinary Shares to be admitted to trading in connection with the Issue and/or the Placing Programme is GB00BKLGLS10. The ISIN for any tranches of C Shares to be issued by the Company under the Placing Programme will be published by the Company at the appropriate time. The Shares are being offered by the Company.

The competent authority which approved this prospectus on 28 October 2021 is the Financial Conduct Authority (“FCA”) of 12 Endeavour Square, London E20 1JN United Kingdom

The summary should be read as an introduction to the Prospectus. Any decision to invest in the C Shares or Ordinary Shares should be based on a consideration of the Prospectus as a whole by the investor. An investor could lose all or part of the capital invested. Civil liability attaches only to those persons who have tabled the summary including any translation thereof, but only where the summary is misleading, inaccurate or inconsistent, when read together with the other parts of the Prospectus, or where it does not provide, when read together with the other parts of the Prospectus, key information in order to aid investors when considering whether to invest in such securities.

Subsequent resale of securities or final placement securities through financial intermediaries

The Company consents to the use of this Prospectus by financial intermediaries in connection with the subsequent resale or final placement of securities by financial intermediaries in the United Kingdom. The offer period within which any subsequent resale or final placement of securities by the Intermediaries can be made and for which consent to use this Prospectus is given commences on 28 October 2021 and closes at 12.00 p.m. on 22 November 2021, unless closed prior to that date. Prospective investors interested in participating in the Intermediaries Offer should apply for New Shares through the Intermediaries by following their relevant application procedures by no later than 12.00 p.m. on 22 November 2021.

Any Intermediary that uses this Prospectus must state on its website that it uses this Prospectus in accordance with the Company’s consent and the conditions attached thereto. Intermediaries are required to provide the terms and conditions of the Intermediaries Offer at the time of such offer to any prospective investor who has expressed an interest in participating in the Intermediaries Offer to such Intermediary. Any application made by investors to any Intermediary is also subject to the terms and conditions imposed by such Intermediary.

KEY INFORMATION ON THE ISSUER

Who is the issuer of the securities?

The issuer is Nippon Active Value Fund plc, a public company limited by shares incorporated under the laws of and domiciled in England and Wales. The LEI of the Company is 213800JOFEGZJYS21P75. The principal legislation under which the Company operates is the Companies Act 2006 (as amended from time to time) (the “Act”) and regulations thereunder. The Company does not have a fixed winding-up date.

The Company’s principal activity is to invest in a highly concentrated portfolio of quoted companies which have the majority of their operations in, or revenue derived from, Japan, with market capitalisations of up to US$1 billion (although there will be no restriction placed on the market capitalisations of investee companies), which the Company deems most attractive and undervalued and in relation to which it believes its activist strategies will deliver increased shareholder returns.

The intention is to take large minority positions in investee companies to enable the Company to effectively implement activist strategies. In order to be able to take such positions, the Company continues to expect that there will be a focus on small-cap companies although, as the Company grows, the Company expects to be able to take meaningful positions in companies with larger market capitalisations. The Company intends to invest in businesses which are run by professional directors and not owner operator businesses. The Company, following advice from the Investment Adviser, is of the opinion that companies run by professional directors tend to have a broader ownership base and are likely to be less hostile to activist strategies.

The Board will continue to refrain from setting any limits on sector weightings or stock selection within the portfolio. The Board applies the following restrictions on the size of its investments: (a) not more than 30 per cent. of the Gross Asset Value at the time of investment will be invested in the securities of a single issuer (such restriction does not, however, apply to the investment of cash held for working capital purposes and pending investment or distribution in near cash equivalent instruments including securities issued or guaranteed by a government, government agency or instrumentality of any EU or OECD Member State or by any supranational authority of which one or more EU or OECD Member States are members); and (b) the value of the four largest investments at the time of investment will not constitute more than 75 per cent. of the Gross Asset Value.

The Company intends to acquire large minority stakes of typically 4.9 to 25.0 per cent. in each investee company (although to date such shareholdings have been typically 1.0 to 6.0 per cent., up to an approximate aggregate of 10 per cent. in some instances together with Michael 1925 LLC and Earle 1927 LLC (together the "Co-Invest Entities"). The Company intends to have invested substantially all of the proceeds of the Issue within six months of the date of the First Admission.

As at 25 October 2021, being the latest practicable date prior to publication of this Prospectus, the Company has been formally notified of the following interests in the Company's Ordinary Shares, comprising three per cent or more of the issued share capital of the Company:

Shareholder	Ordinary Shares	Percentage of issued share capital
Rosenwald Clients	41,560,001	40.35

Rosenwald Capital Management, Inc., Dalton Investments LLC, Dalton Investments Inc. and their affiliates and clients (together, the "Rosenwald Clients") hold 40.35 per cent. of the voting rights in the Company. The Rosenwald Clients are therefore able to exercise control over the Company to the extent that it is able to prevent special resolutions of the Company, which require a 75 per cent. majority to pass, from being passed. Although the Rosenwald Clients do not possess sufficient voting control to pass ordinary resolutions of the Company (which require a simple majority to pass) on their own, their position on the passing (or not) of ordinary resolutions is likely to have a significant bearing on whether such resolutions are passed.

It is expected that the Rosenwald Clients will not participate in the Issue and that therefore their interests in the Company will be diluted to 16.43 per cent. of the issued share capital of the Company (assuming that 150 million Ordinary Shares are issued pursuant to the Issue). If that were to occur then Rosenwald alone would not be able to prevent special resolutions being passed, but would still possess significant influence over the passing (or not) of ordinary and special resolutions. In the event that the Company issues C Shares pursuant to the Issue, voting rights of the Rosenwald Clients would be diluted to 16.43 per cent. (assuming that 150 million C Shares are issued pursuant to the Issue). There will be no dilution of the Rosenwald Client's holding of Ordinary Shares until the conversion of those C Shares into Ordinary Shares. The dilution of the Rosenwald Client's holding at that point will be determined by the conversion ratio applied at that time.

Other than as set out above, the Company is not aware of any person who will directly or indirectly, jointly or severally, exercise or could exercise control over the Company. The Company is not aware of any arrangement, the operation of which may at a subsequent date result in a change of control of the Company.

The Disclosure Guidance and Transparency Rules provide that certain persons (including Shareholders) will be obliged to notify the Company if the proportion of the Company's voting rights which they own reaches, exceeds or falls below specific thresholds (the lowest of which is currently three per cent.).

The Company's directors are Rosemary Morgan, Chetan Ghosh, Ayako Weissman, Rachel Hill and Alicia Ogawa, who are non-executive directors of the Company and considered to be independent. The Company does not have any managing directors.

The Company has no employees and all the Directors are appointed on a non-executive basis. Therefore, the Company is reliant on third party service providers in order to achieve its investment objective. The Company's service providers include, inter alia:

International Fund Management Limited, which has been appointed as the Company's AIFM. In its role as AIFM to the Company, it is responsible for the Company's portfolio management and risk management in accordance with the Company's investment policy, subject to the overall policies, supervision and review of the Board.
Rising Sun Management Ltd., which has been appointed by the AIFM and the Company as Investment Adviser to provide investment advisory services to the AIFM and the Company.

PraxisIFM Fund Services (UK) Limited which has been appointed by the Company as administrator and company secretary.
The Company's auditors are BDO LLP of 55 Baker Street London W1U 7EU.

What is the key financial information regarding the issuer?

Save as set out below, the tables below set out the summary financial information of the Company for the period from incorporation on 22 October 2019 to 31 December 2020, the period from incorporation on 22 October 2019 ended 30 June 2020 and the six months ended 30 June 2021. The information has been prepared in accordance with International Financial Reporting Standards.

Additional information

The data set out in the table below is as at the date of the latest published net asset value, being 25 October 2021

Share Class	Total NAV	No. of shares/units	NAV/share
Ordinary	137,917,001	103,000,001	133.9

Income statement

	22 October 2019 to 31 December 2020 (audited) (€'000)	Six months ended 30 June 2021 (unaudited) (€'000)	22 October 2019 to 30 June 2020 (unaudited) (€'000)
Gains on investments	15,737	11,225	6,074
Income	1,996	1,927	872
Foreign exchange gains/(losses)	(2,070)	(1,301)	(475)
Investment adviser fees	(783)	(506)	(319)
Other operational expenses	(691)	(363)	(377)
Profit before taxation	14,189	10,982	5,775
Taxation	(202)	(193)	(87)
Profit and comprehensive income for the period	13,987	(10,789)	5,688
Earnings per share (pence)	18.94	10.47	5.52

Balance sheet

	22 October 2019 to 31 December 2020 (audited) (€'000)	Six months ended 30 June 2021 (unaudited) (€'000)	Six months ended 30 June 2020 (unaudited) (€'000)
Total net assets	116,986	126,899	108,688

The Prospectus does not include any pro forma financial information. The audit report included in the financial information described above in relation to the period from incorporation on 22 October 2019 to 31 December 2020 contains no qualifications.

What are the key risks that are specific to the issuer?

Prior to investing in the Shares, prospective investors should consider the associated risks. The key risks specific to the Company which are known to the Directors are detailed below:

The Company is a relatively newly formed company with only one set of full-year audited operating results. As the Company lacks a substantial operating history, investors have only a limited basis on which to evaluate the Company's ability to achieve its investment objective or implement its investment strategy and provide a satisfactory investment return.
The Company has no employees and the Directors are appointed on a non-executive basis so the Company is reliant on third party service providers in order to achieve its investment objective. The Company also depends on the diligence, skill and business contacts of the Rising Sun management team. The Company's future success depends on the continued service of these individuals, who are not obligated to remain employed by Rising Sun.

Rising Sun is a relatively newly formed company with a limited investment track record. The company is therefore reliant in part upon the track record of the Rising Sun management team. This track record was acquired as part of activities performed by individuals at other organisations, which were materially different to the strategy employed by Rising Sun, and therefore should not be relied upon as indicative of such persons' performance for the Company.
Rising Sun may not be successful in pursuing the Company's investment policy or in identifying and pursuing investments on attractive terms, generating investment returns for the Company's investors or avoiding investment losses.
Shareholder activism, which forms a key element of the Company's investment strategy, has not been common in Japan and there is no guarantee that the management of portfolio companies will be receptive to the Company's attempts to encourage reform and deliver better value to shareholders.
The Company will continue to invest in a highly concentrated portfolio of shares issued by quoted companies which have the majority of their operations in, or revenue derived from, Japan. Investing in a single country is generally considered a higher risk investment strategy than investing more widely, as it exposes the investor to the fluctuations of a single geographical market and currency, in this case the Japanese market and the Yen.

KEY INFORMATION ON THE SECURITIES

What are the main features of the securities?

Description of securities

The securities which the Company may issue pursuant to the Issue are C Shares of £0.10 each, whose ISIN is GB00BKLGLT27 or Ordinary Shares of £0.01 each, whose ISIN is GB00BKLGLT27.

The securities which the Company intends to issue pursuant to the Placing Programme are (i) Ordinary Shares of £0.01 each, whose ISIN is GB00BKLGLT27, and further tranches of C Shares of £0.10 each, whose ISINs will be published in each case by the Company at the appropriate time.

The Ordinary Shares are, and any C Shares to the issued pursuant to the Issue or the Placing Programme will be, denominated in Sterling and the Issue Price or applicable Placing Programme Price will be payable in Sterling.

Issued share capital

Set out below is the issued share capital of the Company as at the date of this Prospectus:

	Nominal Value (£)	Number
Ordinary Shares	0.01	103,000,001

All Ordinary Shares in issue are fully paid up.

Rights attaching to the Ordinary Shares

Dividend rights: All Ordinary Shares are entitled to participate in dividends which the Company declares from time to time in respect of the Ordinary Shares, proportionate to the amounts paid or credited as paid on such Ordinary Shares.

Rights as respect to capital: On a winding-up or a return of capital, in the event that the Directors resolve to make a distribution to Shareholders, all Ordinary Shares are entitled to a distribution of capital in the same proportions as capital is attributable to them, after taking into account any net assets attributable to the C Shares in issue (if any).

Voting rights: Every Shareholder shall have one vote for each Ordinary Share held by it.

Rights attaching to the C Shares

Dividend Rights: All C Shares are entitled to participate in dividends which the Company declares from time to time in respect of the C Shares, proportionate to the amounts paid or credited as paid on such C Shares.

Rights as respect to capital: On a winding-up or a return of capital, if there are C Shares in issue, the net assets of the Company attributable to the C Shares shall be divided pro rata among the holders of the C Shares. For so long as C Shares are in issue and without prejudice to the Company's obligations under the Act, the assets attributable to the C Shares shall, at all times, be separately identified and shall have allocated to them such

proportion of the expenses or liabilities of the Company as the Directors fairly consider to be attributable to any C Shares in issue.

Voting rights: Every Shareholder shall have one vote for each C Share held by it.

Restrictions on the free transferability of the Shares

The Board may, in its absolute discretion and without giving a reason, refuse to register a transfer of any Share in certificated form or uncertificated form (subject to the Articles) which is not fully paid and on which the Company has a lien provided that this would not prevent dealings in the Shares of that class from taking place on an open and proper basis on the London Stock Exchange.

In addition, the Board may refuse to register a transfer of Shares if (i) in the case of certificated Shares (a) it is in respect of more than one class of Shares, (b) it is in favour of more than four joint transferees, (c) it is not duly stamped or duly certificated to the satisfaction of the Board as being exempt from stamp duty, (d) it is not delivered for registration to the registered office of the Company or such other place as the Board may decide, or (e) is not accompanied by the certificate for the Shares to which it relates and such other evidence of title as the Board may reasonably require.

The Board may decline to register a transfer of an uncertificated share which is traded through the CREST system in accordance with the CREST Regulations where, in the case of a transfer to joint holders, the number of joint holders to whom uncertificated shares is to be transferred exceeds four.

Dividend policy

The Company's intention is to look to achieve its results primarily through capital appreciation. As such, no specific dividend policy has been established and any distributions will be made entirely at the discretion of the Board.

Where will the securities be traded?

Applications will be made to the London Stock Exchange for the New Shares to be issued pursuant to the Issue and for the New Ordinary Shares and/or C Shares to be issued from time to time pursuant to the Placing Programme to be admitted to the Specialist Fund Segment.

What are the key risks that are specific to the securities?

The key risks relating to the Shares which are known to the Directors are detailed below:

The Rosenwald Clients (described in greater detail in paragraph 5.5 of Part 14 (General Information) of this Prospectus) currently hold 40.35 per cent. of the total issued share capital of the Company. The precise shareholdings of the Rosenwald Clients following First Admission will depend on the outcome of the Issue as a whole, although it is expected that the Rosenwald Clients will not participate in the Issue and that therefore their interests in the Company will be diluted to 16.43 per cent. of the total issued share capital of the Company (assuming that 150 million Ordinary Shares are issued pursuant to the Issue. As a result, James B. Rosenwald, III may be in a position to influence, through the votes attaching to the Rosenwald Clients' shareholdings the outcome of matters relating to the Company. To the extent that the Rosenwald Clients' interests conflict with those of the other Shareholders, this may have a material adverse effect on the value of the Shares, the performance of the Company and the Company's returns to Shareholders. In the event that the Company issues C Shares pursuant to the Issue, voting rights of the Rosenwald Clients would be diluted to 16.43 per cent. (assuming that 150 million C Shares are issued pursuant to the Issue). There will be no dilution of the Rosenwald Client's holding of Ordinary Shares until the conversion of those C Shares into Ordinary Shares. The dilution of the Rosenwald Client's holding at that point will be determined by the conversion ratio applied at that time.
The Company's ability to declare and pay any future dividend is subject to the discretion of the Directors and will depend upon, amongst other things, the Company pursuing successfully its investment strategy and the Company's distributable reserves, earnings, financial position, cash requirements, level and rate of borrowings and availability of profit, as well the provisions of relevant laws or generally accepted accounting principles from time to time.
The value of an investment in the Company is subject to normal market fluctuations and other risks inherent in investing in securities. The market price of the Shares may rise or fall rapidly and the Shares may trade at a discount to the NAV attributable to them.

KEY INFORMATION ON THE OFFER OF SECURITIES TO THE PUBLIC AND ADMISSION TO TRADING ON A REGULATED MARKET

Under which conditions and timetable can I invest in this security?

The Issue consists of an initial placing, an offer for subscription and an intermediaries offer of New Shares. The total number of New Shares allotted under the Issue will be determined by the Company, Shore Capital and Rising Sun after taking into account demand for the New Shares and prevailing economic and market conditions, subject to a maximum of 150 million Shares.² After engaging with investor demand, the Company is expected to make an announcement as to whether C Shares or Ordinary Shares will be issued pursuant to the Issue on or around 12 November 2021. In the event that the Directors decide to proceed with an issue of Ordinary Shares, the Issue Price for the new Ordinary Shares will be determined by the Company and will be not less than the prevailing Net Asset Value per Ordinary Share at the time of determination of the Issue Price plus a premium which, together with premia over the course of the Placing Programme, is intended to cover the fixed costs of the Issue. In the event that the Directors decide to proceed with an issue of C Shares, the Issue Price for the C Shares will be £1.00.

The Initial Placing, Offer for Subscription and the Intermediaries Offer are conditional amongst other things on: (i) the Share Allotment Authorities being passed at the General Meeting and not having been revoked or superseded; (ii) the Placing Agreement having become unconditional in all respects (save for the condition relating to First Admission) and not having been terminated in accordance with its terms prior to First Admission; and (iii) First Admission becoming effective not later than 8:00 a.m. on 25 November 2021 or such later time and/or date as Shore Capital and the Company may agree (being not later than 8:00 a.m. on 31 January 2022).

If any of these conditions are not met, the Issue will not proceed and an announcement to that effect will be made through a Regulatory Information Service.

The New Shares issued pursuant to the Issue are expected to be issued on 25 November 2021. The Initial Placing, the Offer for Subscription and the Intermediaries Offer are only available to investors who can make certain warranties and representations as to their status as an investor. The Initial Placing is only available to persons of a kind described in paragraph 5 of Article 19 and paragraphs 2(a) to (d) of Article 49 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005.

An investor applying for New Shares under the Issue may elect to receive Shares in uncertificated form, if such investor is a system-member in relation to CREST, or in certificated form. Definitive certificates in respect of the Shares issued in certificated form are expected to be despatched during the week commencing 29 November 2021.

Placing

The Company, Rising Sun and Shore Capital have entered into the Placing Agreement, pursuant to which Shore Capital has agreed, subject to certain conditions, to use its reasonable endeavours to procure subscribers of the New Shares to be made available in the Initial Placing. The Initial Placing is not being underwritten.

The Intermediaries Offer

Investors may also subscribe for New Shares at the Issue Price pursuant to the Intermediaries Offer. Only the Intermediaries' retail investor clients in the United Kingdom are eligible to participate in the Intermediaries Offer, whether directly or through wealth managers. Investors may apply to any one of the Intermediaries which is appropriately licensed in the client's jurisdiction to be accepted as their client. The minimum application amount in the Intermediaries Offer is £5,000. The actual number of New Shares to be allocated to the Intermediaries will be determined by the Company (in consultation with the Investment Adviser and Shore Capital).

Offer for Subscription

Each investor under the Offer for Subscription is required to undertake to pay the Issue Price for the New Shares issued to such investor by cheque or bankers' draft or by electronic interbank transfer. Applications under the Offer for Subscription must be for a minimum of £5,000.

Placing Programme

In addition to the Issue, the Company also intends to implement the Placing Programme pursuant to which such number of additional Shares as is equal to 300 million Shares in aggregate less the number of Shares issued under the Issue) may be issued under one or more non-pre-emptive Subsequent Placings over the 12 month period commencing on the date of this Prospectus under the Placing Programme. The Placing Programme is flexible and may have a number of closing dates in order to provide the Company with the ability to issue

2 The Directors have reserved the right, in consultation with Shore Capital, to increase the size of the Issue by up to 150 million New Shares if overall demand exceeds 150 million New Shares. Any such increase will be announced through an RNS announcement.

Ordinary Shares and/or C Shares over a period of time. The last date on which Shares may be admitted to trading under the Placing Programme is 24 October 2022.

An investor applying for New Ordinary Shares and/or C Shares in the Placing Programme may elect to receive New Ordinary Shares and/or C Shares in uncertificated form, if such investor is a system member in relation to CREST, or certificated form.

Dilution

If C Shares are issued pursuant to the Issue, assuming 150 million C Shares are issued, existing Shareholders who do not participate in the Issue will suffer an immediate dilution in voting rights of approximately 59.3 per cent. Existing Shareholders will not suffer any dilution in the proportion of Ordinary Shares held by them until the conversion of those C Shares into Ordinary Shares. The dilution of a Shareholder's holding at that point will be determined by the conversion ratio applied at that time.

If Ordinary Shares are issued pursuant to the Issue, assuming 150 million Ordinary Shares are issued, existing Shareholders who do not participate in the Issue will suffer an immediate dilution of 59.3 per cent.

Assuming that 150 million Ordinary Shares are issued pursuant to the Issue and a further 150 million Ordinary Shares are issued under the Placing Programme, a Shareholder holding shares representing one per cent. of the Company's Ordinary Shares following the Issue, who does not participate in the Placing Programme, would, following the completion of the Placing Programme, hold Ordinary Shares representing approximately 0.6 per cent. of the Company's issued Shares.

Expenses

The Issue Expenses are those that are necessary for the completion of the Issue.

Any expenses incurred by any Intermediary are for its own account. Investors should confirm separately with any Intermediary whether there are any commissions, fees or expenses that will be applied by such Intermediary in connection with any application made through that Intermediary pursuant to the Intermediaries Offer.

The Issue Price of any New Ordinary Shares issued pursuant to the Issuances will be calculated by reference to the last published cum income Net Asset Value of each existing Ordinary Share together with a premium intended to at least cover the costs and expenses of the placing pursuant to the Issuances (including, without limitation, any placing commissions). The final Issue Price is to be determined by the Board at its discretion and will be announced via an RIS prior to each Admission. It is expected that the costs of the New Ordinary Shares issued pursuant to the Issuances will be recovered through the Issue Price, although the recovery of all or any part of the costs cannot be guaranteed. The Directors therefore intend to avoid any dilution of the Net Asset Value of the existing Ordinary Shares held by Shareholders.

Why is this prospectus being produced?

Up to 150 million New Shares are available under the Issue at the Issue Price to raise Gross Proceeds of up to £150 million. Assuming that the Issue is fully subscribed, and the Issue Expenses are £2.7 million, the net proceeds from the Issue will be £147.3 million. Neither the Initial Placing, the Offer for Subscription or the Intermediaries Offer are underwritten. The Issue and Placing Programme are intended to raise money for investment in accordance with the Company's investment policy.

Conflicts of Interest

As at the date of this Prospectus, as far as the Company is aware the only material potential conflicts of interest which any of the service providers to the Company may have as between their duty to the Company and duties owed by them to third parties and their own interest are as follows: (a) James B. Rosenwald, III is the chief investment officer at Rising Sun. Mr Rosenwald is also a co-founder and the managing partner of Dalton Investments LLC, which is the ultimate parent of Dalton Advisory KK, a firm engaged to provide investment research and analysis to Rising Sun. Mr Rosenwald is also a director of certain companies in Shore Capital's group and sits on its board; (b) Gifford Combs is a senior executive at Rising Sun. Mr Combs is also a co-founder of Dalton, which is the ultimate parent of Dalton Advisory KK, a firm engaged to provide investment research and analysis to Rising Sun; (c) Dalton is a value focused investment management firm with expertise in Asia equities and global equities. Dalton has a strong track record investing in Japanese equities. Dalton Advisory KK undertakes investment research and data analysis services in relation to Japanese equities for both Dalton

(and its affiliates) and the Company. Therefore, there is a risk that Dalton and the Company may find themselves targeting the same investment opportunity. From the date of this Prospectus, Rising Sun intends to allow a limited number of investments to be made in entities in which Dalton (or its affiliates) also invest, subject to the policies and procedures governing overlapping investments agreed to by the Company, Rising Sun and Dalton; and (d) Shore Capital owns 15 per cent. of Rising Sun's issued share capital.

PART 1 RISK FACTORS

Investment in the Company should be regarded as being of a long-term nature and involving a degree of risk. Accordingly, prospective investors should consider carefully all of the information set out in this Prospectus and, in particular, the risks relating to the Company, Rising Sun and the Shares described below.

Only those risks which are believed to be material and currently known to the Directors at the date of this Prospectus have been disclosed. Those risks may adversely affect the Company and its business, business prospects, financial condition and NAV ("Company's NAV and revenues") and returns to Shareholders including dividends, and/or the market price of the Shares ("returns to Shareholders"). Additional risks and uncertainties not currently known to the Directors, or that the Directors deem immaterial at the date of this Prospectus, may also have an adverse effect on the Company's NAV, revenues and returns to Shareholders. Potential investors should review this Prospectus carefully and in its entirety and consult with their professional advisers before making an application to invest in the Shares.

Prospective investors should note that the risks relating to the Company, its industry and the Shares summarised in the section of this Prospectus headed "Summary" are the risks that the Directors believe to be the most essential to an assessment by a prospective investor of whether to consider an investment in the Shares. However, as the risks which the Company faces relate to events and depend on circumstances that may or may not occur in the future, prospective investors should consider not only the information on the key risks summarised in the section of this Prospectus headed "Summary" but also, among other things, the risks and uncertainties described below.

RISKS RELATING TO THE COMPANY

The Company is a relatively newly formed company with a limited operating history, and investors have therefore only a limited basis on which to evaluate the Company

The Company is a relatively newly formed company with limited track record. As the Company lacks a substantial operating history, investors have only a short period of financial results on which to evaluate the Company's ability to achieve its investment objective or implement its investment strategy and provide a satisfactory return. An investment in the Company is therefore subject to all the risks and uncertainties associated with a new business, including the risk that the Company will not achieve its investment objective and that the value of an investment in the Company could decline substantially as a consequence.

The Company is to a large extent reliant on the AIFM, Rising Sun, the Administrator and other third party service providers to carry on its businesses and a failure by one or more service providers may materially disrupt the business of the Company

The Company has no employees and the Directors have been appointed on a non-executive basis. Whilst the Company has taken all reasonable steps to establish and maintain adequate procedures, systems and controls to enable it to comply with its obligations, the Company is reliant upon the performance of third party service providers for its executive functions and to achieve its investment objective.

Failure by any service provider to carry out its obligations to the Company in accordance with the applicable duty of care and skill, or at all, or termination of any such appointment may adversely affect the Company's NAV, revenues and returns to Shareholders.

In the event that it is necessary for the Company to replace any third party service provider, it may be that the transition process takes time, increases costs and may adversely affect the Company's NAV, revenues and returns to Shareholders. See further risk factor entitled "The departure of some or all of Rising Sun's investment professionals could prevent the Company from achieving its investment objective".

The Company may not achieve its investment objective and investors may not get back the full value of their investment

The Company's returns to Shareholders will depend on many factors, including the value and performance of its investments and the Company's ability successfully to execute its investment strategy. The value and performance of the Company's investments will be affected by a broad range of factors which are described in more detail below and there can be no assurance that the Company's investment strategy will be successful or

that the Company will be able to generate investment returns or avoid investment losses. Any failure by the Company to achieve its investment objective may adversely affect its operations and returns to Shareholders.

Investor returns will be dependent upon the performance of the Portfolio and the Company may experience fluctuations in operating results

Investors contemplating an investment in the Shares should recognise that their market value can fluctuate and may not always reflect their underlying value. Returns achieved are reliant primarily upon the performance of the Portfolio. No assurance is given, express or implied, that Shareholders will receive back the amount of their original investment.

The Company may experience fluctuations in its financial results due to a number of factors, including changes in the values of investments made by the Company, changes in the amount of profits, distributions, dividends or interest received from the Portfolio, changes in the operating expenses of the Company, variations in and the timing of the recognition of realised and unrealised gains or losses, the degree to which the Company or its investments encounter competition and general economic and market conditions. Such variability may lead to volatility in the trading price of the Shares and cause the Company's results for a particular period not to be indicative of its performance in a future period.

Delays in deployment of the proceeds of the Issue

The Company is aiming to have invested substantially all of the proceeds of the Issue within six months from the date of First Admission but there can be no guarantee that this will be achieved. Depending on the availability of attractive investee companies that fit within the Company's investment policy and investment strategy and the ability to successfully acquire positions in such investee companies at an appropriate price, it may take the Company more than six months to invest the proceeds of the Issue. There can be no assurance as to how long it will take for the Company to invest the proceeds of the Issue and the longer the period the greater the likelihood that the Company's NAV, revenues and returns to Shareholders will be materially adversely affected.

Investment opportunities

The investment objective of the Company is to provide Shareholders with capital growth through investment in a highly concentrated portfolio of shares issued by quoted companies which have the majority of their operations in, or revenue derived from, Japan and which have a substantial proportion of their market capitalisation held in cash and/or listed securities and/or realisable assets. Should such opportunities become less available then the Company's investment approach may not produce attractive returns. In such circumstances the Directors will consider the future of the Company and may recommend that the Company's investments are sold, it is wound up and cash returned to Shareholders.

Duration

The Directors intend to deliver a full or partial exit opportunity to Shareholders in the Company in five years after the IPO Admission Date. Such an exit opportunity may result in the winding-up of the Company. In any event, Shareholders shall have the opportunity to vote on an ordinary resolution on the continuation of the Company at the annual general meeting to be held in 2025 and every second annual general meeting thereafter. If any such ordinary resolution is not passed, the Directors shall draw up proposals for the voluntary liquidation, unitisation, reorganisation or reconstruction of the Company for consideration by the Shareholders at a general meeting to be convened by the Directors for a date not more than six months after the date of the meeting at which such ordinary resolution was passed.

Discount management provisions

Any share buybacks in the context of the Company's discount management provisions may be satisfied by the available cash or cash equivalent resources of the Company, from borrowings, the realisation of the Company's assets or any combination of these sources of liquidity, at the Directors' discretion.

The Company's share buyback policy is expressly subject to the Board's discretion. There is no guarantee that any share buyback will be undertaken, or that any such buyback programme would be successful in narrowing any potential discount at which the Shares may trade. Accordingly, potential investors should not place reliance on share buybacks as a source of potential exit from the Shares.

Distributions and dividend policy

There can be no guarantee that any distributions will be paid by the Company in respect of any financial period and there can be no guarantee that an investment in the Company will deliver any returns to Shareholders. The Company's ability to make distributions is dependent on a number of factors, including the level of dividends and interest earned from its portfolio of investments and the net revenue profits available for that purpose.

Any change in the tax treatment of dividends received by the Company from investments or income received by the Company may reduce the distributions made to Shareholders. Any change to the basis upon which dividends can be paid by the Company under UK law or accounting rules and standards could have an adverse effect on the Company's ability to pay dividends or distributions.

The payment of any dividends to Shareholders will be dependent on the level of the Company's net income and the requirements of the Act and such dividends will be declared entirely at the discretion of the Board. There is therefore a risk that the Company may not pay any dividends to Shareholders (other than those that may be required to maintain investment trust status).

Certain interests could give rise to a potential conflict between the interests of the Company and those of certain officers and advisers to the Company

James B. Rosenwald, III has a controlling interest in Rosenwald Capital which in turn is the majority owner of both Rising Sun (which acts as the Company's investment adviser), Dalton Investments, Inc. and Dalton Investments LLC and through the latter Dalton Advisory KK (which is engaged to provide investment analysis to Rising Sun). Furthermore, James B. Rosenwald, III is the chief investment officer at Rising Sun and is also a director of certain companies in Shore Capital's group and sits on its board. Shore Capital is a minority owner of Rising Sun.

Any of these arrangements or relationships, unless any inherent conflicts of interest are able to be managed effectively, could be detrimental to the Company and they could materially and adversely affect its performance. In order to minimise the risk of such a situation arising, it is Rising Sun's intention to manage the investment portfolio of the Company so as to have overlapping investments with Dalton only in circumstances where such overlapping investments are made and managed in accordance with the policies and procedures described in the section of paragraph 6 of Part 7 of this Prospectus headed "Conflicts policy and procedures regarding overlapping investments between the Company and Dalton Investors". The focus of Rising Sun will be to invest in enterprises in which neither Dalton nor its clients have any interest.

Risks associated with the effects of the Coronavirus Disease 2019 (COVID-19) pandemic

The effects of the outbreak of the Coronavirus Disease 2019 (COVID-19) in December 2019, which was announced a pandemic by the World Health Organization on 11 March 2020, on the Japanese market and Japanese companies specifically, and the global economy in general, cannot be reliably assessed as at the date of this Prospectus. Market volatility and/or a period of recession caused by the outbreak of the COVID-19 pandemic may have an adverse effect on the Portfolio and, in particular, may result in increased price volatility for the companies comprising the Portfolio and reduced market depth. Rising Sun's intended strategy of having a physical staff presence in close proximity to investee companies has been hampered by periodic and ongoing restrictions on travel into Japan since the beginning of the COVID-19 pandemic. There may also be a risk that the employees and investment professionals of the Company and its third-party service providers have an increased desire, in the wake of the COVID-19 pandemic, to work remotely and flexibly in different jurisdictions, which could create operational challenges for the Company and its third-party service providers as a result of needing to comply with multiple additional tax regimes. In addition, there may be a risk that the jurisdictions of companies in the Portfolio raise tax rates in order to help counteract any economic damage that the COVID-19 pandemic may have caused in such jurisdictions. The foregoing could have a material adverse effect on the Company's financial position, results of operations, business prospects and returns to investors.

RISKS RELATING TO RISING SUN

The departure of some or all of Rising Sun investment professionals could prevent the Company from achieving its investment objective

The Company has no employees and the Directors have all been appointed on a non-executive basis. Therefore, the Company is to a large extent reliant upon the AIFM, Rising Sun, the Administrator and other third party service providers, including the Registrar, for the performance of certain functions.

The Company believes that its success and the success of the investment strategy is largely dependent upon the experience and expertise of Rising Sun and its continued provision of services to the Company.

The Company depends on the diligence, skill and judgment of the Rising Sun Management Team. The Company's future success depends on the continued service of these individuals, who are not obliged to remain employed by, or contractually bound to perform services for, Rising Sun and Rising Sun's ability to strategically recruit, retain and motivate new talented personnel. Whilst Rising Sun endeavours to ensure that the principal members of the Rising Sun Management Team are suitably incentivised, the retention of key members of its team cannot be guaranteed. In the event of a departure of a member of the Rising Sun Management Team, there is no guarantee that Rising Sun would be able to recruit a suitable replacement or that any delay in doing so would not adversely affect the Company's NAV, revenues and returns to Shareholders. Events impacting but not entirely within Rising Sun's control, such as its financial performance, it being acquired or making acquisitions or changes to its internal policies and structures could in turn affect its ability to retain key personnel. If key personnel of the Rising Sun Management Team were to depart or Rising Sun was unable to recruit individuals with similar experience and calibre, Rising Sun may not be able to provide services to the requisite level expected or required by the Company. This could have a material adverse effect on the performance of the Company's NAV, revenues and returns to Shareholders.

The Company is reliant on the investment record of the Rising Sun Management Team who may not be able to implement the investment policy on behalf of the Company

Rising Sun is a relatively newly formed company with a limited investment track record. The Company is therefore reliant in part on the track record of the Rising Sun Management Team. This track record was acquired as part of activities performed by individuals at other organisations, which were materially different to the strategy employed by Rising Sun, and therefore should not be relied upon as indicative of such persons' performance for the Company. Furthermore, the past performance of other investments managed, advised or operated by the Rising Sun Management Team cannot be relied upon as an indicator of the future performance of the Company. Investor returns will be dependent upon the Company successfully pursuing its investment policy. Therefore, the success of the Company will depend, among other things, on Rising Sun's ability to identify, acquire and (potentially) realise investments in accordance with the Company's investment policy and once acquired, to effectively monitor those investments. The acquisition of investments, will, in turn, depend on the ability of Rising Sun to apply its investment processes in a way which is capable of identifying suitable investments for the Company to invest in. There can be no assurance that Rising Sun will be able to do so or that the Company will be able to invest the Company's assets on attractive terms or generate any investment returns for Shareholders or indeed avoid investment losses.

There can be no assurance that the Directors will be able to find a replacement investment adviser if Rising Sun resigns

Pursuant to the terms of the Investment Advisory Agreement, Rising Sun may resign by giving the Company not less than 12 months' written notice (although no such notice may be given within the first four years from the IPO Admission Date). Further, the Investment Advisory Agreement may be terminated by the AIFM and the Company, or the Company by itself, in certain limited circumstances, such as where the Investment Adviser is in material breach of the Investment Advisory Agreement and such breach is not remedied. The Board would, in such circumstances, have to find a replacement investment advisory services provider for the Company and may be unable to appoint a replacement with the necessary skills and experience on terms acceptable to the Shareholders. If the Investment Advisory Agreement is terminated and a suitable replacement is not secured in a timely manner, this could have an adverse effect on the value of the Portfolio, the Company's financial condition, results of operations and prospects, with a consequential adverse effect on the returns to Shareholders and the market value of the Shares.

The Company may be required to make payments to the Investment Adviser under indemnities in the Investment Advisory Agreement

Under the Investment Advisory Agreement, Rising Sun agrees to perform its obligations to a specified standard of care, provided that Rising Sun will not be liable for any loss or damages resulting from any failure to satisfy the standard of care except in certain limited circumstances. If a liability were to be incurred by the Company in a situation where Rising Sun had acted in accordance with its standard of care, the Company would (except in certain limited circumstances) have no recourse to Rising Sun and such liabilities would be for the account of the Company. This could have a material adverse effect on the performance of the Company's NAV, revenues and returns to Shareholders. Additionally, under the Investment Advisory Agreement the Company will be required

to indemnify Rising Sun and its affiliates, managers, directors, officers, partners, agents and employees, from and against all liabilities incurred in connection with the Investment Advisory Agreement (except to the extent such liabilities are incurred as a result of any acts or omissions of Rising Sun that constitute a material breach of such agreement or are otherwise outside the scope of such indemnities). As a result, if such liabilities arise, the Company may be required to make payment under such indemnities, which could have a material adverse effect on the performance of the Company's NAV, revenues and returns to Shareholders.

Rising Sun has engaged an external provider of investment research services which it may not be able to replace if the engagement is terminated

Rising Sun has engaged Dalton Advisory KK to provide investment research services to Rising Sun in order to enable Rising Sun properly perform its function as investment adviser to the Company. In the event that Dalton Advisory KK ceases to provide investment research services to Rising Sun then Rising Sun would need to replace Dalton Advisory KK with a replacement provider of investment services with expertise in the Japanese securities market. Should Rising Sun be unable to appoint such a replacement, it may impact on Rising Sun's ability to discharge its function as investment adviser to the standard requirement under the Investment Advisory Agreement. Dalton Advisory KK is a wholly owned subsidiary of Dalton Investments LLC. Gifford Combs and James B. Rosenwald, III, who are both senior executives in the Rising Sun Management Team, are co-founders and senior officers of Dalton Investments LLC.

Rising Sun and its affiliates and/or Dalton Advisory KK may provide services to other clients which could compete directly or indirectly with the activities of the Company and may be subject to conflicts of interest in respect of its activities on behalf of the Company

Under the terms of the Investment Advisory Agreement, Rising Sun is entitled to carry on business similar to or in competition with the Company or to provide similar services to, or in competition with, the Company or to provide similar services or any other services whatsoever to any other customer without being liable to account to the Company for its profits, provided that it will take all reasonable steps to ensure that such business is effected on terms which are not materially less favourable to the Company.

At all times Rising Sun shall retain sufficient facilities, personnel, experience and expertise necessary to fulfil its obligations under the Investment Advisory Agreement. Rising Sun will, at all times, have regard to its obligations to the Company in relation to the identification, management and disclosure of conflicts of interest.

Dalton Advisory KK provides services to other clients as well as Rising Sun. Accordingly, the activities of Dalton Advisory KK's other clients may compete with the activities of the Company.

Reliance on Rising Sun's due diligence and investment processes

Before making investments on behalf of the Company, Rising Sun conducts such due diligence and investment analysis as it deems reasonable and appropriate based on the facts and circumstances applicable to each investment. There can be no assurance that Rising Sun's due diligence and analysis with respect to any investment opportunity will reveal or highlight all relevant facts that may be necessary or helpful in evaluating that investment opportunity. Any failure by Rising Sun to identify relevant facts through its due diligence and investment process may lead to inappropriate investment decisions, which could have a material adverse effect on the Company's profitability, Net Asset Value and the market price of the Ordinary Shares.

RISKS RELATING TO THE INVESTMENT STRATEGY

Risk associated with pursuing an activist shareholder strategy in Japan

The Company intends to use various activist methodologies to encourage reform and restructuring in the companies comprising its investment portfolio and therefore increase the value of the Company's holdings. Nevertheless, until recent changes to Japanese corporate governance rules encouraged an increase in shareholder activism in the country, shareholder activism has not been common in Japan and there is no guarantee that the management of portfolio companies will be receptive to the Company's attempts to encourage reform and deliver better value to shareholders.

The Company may not be able to pursue its investment strategy or achieve its investment objective

There can be no guarantee that suitable investment opportunities will be available to the Company or that the Company's investments will generate gains or income, or that any gains or income that may be generated on particular investments will be sufficient to offset any losses that may be sustained.

The success of the Company will depend on the ability of the Company and Rising Sun to pursue the Company's investment policy successfully and on broader market conditions. Rising Sun may not be successful in pursuing the Company's investment policy. Rising Sun may not be able to identify and complete investments on attractive terms and the Company may not be able to generate investment returns for its investors or avoid investment losses.

The investment objective of the Company is an objective only. Failure to achieve the Company's investment objective could occur because of a failure to acquire investment opportunities on favourable terms. Such failures are likely to have an adverse effect on the value of the Portfolio, the Company's financial condition, results of operations and prospects, with a consequential adverse effect on returns to Shareholders and the market value of the Shares.

Risk associated with investing in a single country

The Company will continue to invest in shares issued by listed or traded companies which have the majority of their operations in, or revenue derived from, Japan. Investing in a single country is generally considered a higher risk investment strategy than investing more widely, as it exposes the investor to the fluctuations of a single geographical market and currency, in this case the Japanese market and the Yen. Any adverse effect on the Japanese market and/or the value of the Yen could have an adverse effect on the Portfolio, financial condition, results of operations and prospects, with a consequential adverse effect on the market value of the Ordinary Shares.

Risks associated with investments in Japan

The Company's investments will continue to be primarily in equity securities in Japan and as such are subject to a variety of risks related to any investment in foreign securities, including, but not limited to foreign exchange risks, conversion risk, tax risk and general business conditions risk in Japan. For example:

The Company's investments will be primarily held in securities denominated in Japanese Yen. The value of the Yen may fluctuate against the British pound sterling. There can be no guarantee that the Fund's investments will maintain their value when measured in British pounds sterling.
The Company expects that it will be able to convert the proceeds of sales of its investments from Japanese Yen into British pounds sterling; but there is no guarantee that the Japanese government will not place restrictions on such conversion.
The Company believes that it will be able to repatriate funds from Japan to the United Kingdom without restriction; but there is no guarantee that such repatriation might not be restricted in the future.
The Company believes that its investments can be structured so that it will not be subject to taxation on proceeds from sales; but there can be no guarantee of such treatment in the future.
The Company's investments in Japan will be necessarily dependent upon the general business conditions prevailing in Japan. In recent years, the Japanese economy has exhibited sluggish growth at times and is still highly dependent upon exports. As such, the Company's investments will be dependent upon the vicissitudes of the world economy in general and the economic conditions in East Asia in particular.
The number, quality and size of investment opportunities, and general market and economic conditions, may lead to delays in investing the proceeds of the Initial Placing and any Placing Programme. If equity prices rise or fall significantly before the proceeds are fully invested this may have an impact on the Company's growth.
The value of Japanese securities may be affected by factors not typically associated with investments in the UK. The liquidity and settlement risk associated with an investment in Japanese securities and the accounting standards that apply to Japanese issuers may differ from those that would apply in the UK. Changes in economic conditions (for example, inflation, rates of tax and regulatory protection) and the political environment in Japan could substantially and adversely affect the Company's prospects and returns.

Government policy, legal or regulatory changes could reduce the ability of the Company to pursue an activist investor strategy in Japan. The concentration of the investments in Japan alone exposes the Company to policy changes that specifically affect Japan and the operating, regulatory, legal and corporate governance environment for listed securities located in Japan. In particular, an amendment to the Foreign Exchange and Foreign Trade Act ("FEFTA"), which took effect in May 2020, obliges foreign investors to make a notification filing before their holdings in companies in potentially sensitive sectors, which range from nuclear power and IT to agriculture and marine transport, reach one per cent. The new filing requirement under FEFTA gives Japanese companies an early indication that a foreign activist investor is building a stake.

The Company does not expect to control companies in its Portfolio and cannot therefore ensure that they do not make decisions that decrease the returns to the Company from that investment

The Company does not expect to take controlling stakes in the companies in its Portfolio. Consequently there can be no guarantee that the Company's proposed activist strategy will succeed. Further, the Company is subject to the risk that companies in its Portfolio may make business decisions with which it disagrees and which may decrease the value of the Company's investment in that company or, in some circumstances, cause reputational damage to the Company. If this were to happen, it could have an adverse effect on the Portfolio, financial condition, results of operations and prospects, with a consequential adverse effect on the market value of the Shares.

Sectoral diversification

The Company is not subject to restrictions on the amount it may invest in any particular sector. Although the Portfolio is expected to be diversified in terms of sector exposures, the Company may have significant exposure to portfolio companies from certain sectors from time to time. As there is no hard limit on the amount the Company may invest in any sector the entire Portfolio may, at certain times, be invested solely in one sector. Greater concentration of investments in any one sector may result in greater volatility in the value of the Company's investments and consequently its Net Asset Value and may materially and adversely affect the performance of the Company and returns to Shareholders.

The Portfolio may include unquoted investments

The Company intends that the majority of its investments will be in quoted companies. The Company may also make investments in unquoted companies and the Company may become invested in unquoted companies as a result of corporate actions or commercial transactions undertaken by quoted companies. The Company will only make investments in an unquoted company in accordance with its investment policy and provided that the aggregate interest of the Company in unquoted companies at the time of any investment is not more than 10 per cent. of the Net Asset Value of the Company at that time. Investments in unquoted companies may not have readily ascertainable market prices and may have reported valuations that differ from their true and actual realisable value. Valuations can be subject to significant fluctuations.

Some unquoted companies may not have ongoing valuations provided by third parties. The Investment Adviser's investment recommendations are based on analysis and valuations which may be materially inaccurate. In addition, the Investment Adviser may have to rely on old valuations in its investment process.

If values realised for underlying investments made by such investee companies are materially different from those values contained in reported valuations for such investee companies, there is a risk that investors may be carrying their investment in their books at an incorrect value and the price at which they buy and sell ordinary shares in such companies in the secondary market may not reflect the true value of such ordinary shares. As the Company is expected to be an investor in such investee companies this may impact the Net Asset Value of the Company.

Borrowings

The Company may use borrowings and other gearing to seek to enhance investment returns. Whilst the use of borrowings should enhance the total return on the Ordinary Shares where the return on the Company's underlying assets is positive and exceeds the cost of the borrowings, it will have the opposite effect where the return on the Company's underlying assets is at a lower rate than the cost of the borrowings, reducing the total return on the Ordinary Shares. As a result, the use of borrowings by the Company may increase the volatility of the NAV per Ordinary Share and/or NAV per C Share.

As a result of gearing, any reduction in the value of the Company's investments may lead to a correspondingly greater percentage reduction in its Net Asset Value (which is likely to adversely affect the price of an Ordinary Share). Any reduction in the number of Ordinary Shares in issue (for example, as a result of buy backs) will, in the absence of a corresponding reduction in borrowings, result in an increase in the Company's level of gearing.

To the extent that a fall in the value of the Company's investments causes gearing to rise to a level that is not consistent with the Company's gearing policy or borrowing limits, the Company may have to sell investments in order to reduce borrowings, which may give rise to a significant loss of value compared to the book value of the investments, as well as a reduction in income from investments. No assurance can be given that any sales of the Company's investments would realise proceeds which would be sufficient to repay any borrowings.

There is no guarantee that any borrowings of the Company will be refinanced on their maturity, either on terms that are acceptable to the Company or at all.

The Company will pay interest on any borrowings and, as such, the Company will be exposed to interest rate risk due to fluctuations in the prevailing market rates. The Company may employ hedging techniques designed to reduce the risk of adverse movements in interest rates. However, such strategies may also result in losses and overall poorer performance than if the Company had not entered into such hedging transactions.

Derivative instruments

The Company may use derivatives for investment purposes, to seek to enhance portfolio returns and for efficient portfolio management, to reduce, transfer or eliminate risk in its investments, including protection against currency risks, or to offset exposure to a specific market. Any use of derivatives for investment purposes will be made on the basis of the same principles of risk spreading and diversification that apply to the Company's investments. The use of derivatives gives rise to a number of specific potential risks. Derivative instruments can be highly volatile and expose investors to a high risk of loss. The low initial margin deposits normally required to establish a position in such instruments permit a high degree of leverage. As a result, depending on the type of instrument, a relatively small movement in the price of a contract or the underlying securities may result in a profit or loss which is high in proportion to the amount of funds actually placed as the initial margin and may result in further loss exceeding any margin deposited. In addition, daily limits on price fluctuations and speculative position limits on exchanges may prevent prompt liquidation of positions resulting in potentially greater losses.

Furthermore, the use of derivative instruments involves certain special risks for a company, including:

(a) dependence on movements in the price of underlying securities and movements in interest rates;
(b) when used for hedging purposes, an imperfect correlation between the returns on the derivative instruments used for hedging and the returns on the investments or market sectors being hedged; and
(c) credit exposure to the counterparty with whom it trades.

Counterparty risks may differ materially from those entailed in exchange-traded transactions that generally are backed by clearing organisation guarantees, daily marking-to-market and settlement, and segregation and minimum capital requirements applicable to intermediaries. Transactions entered into directly between counterparties generally do not benefit from such protections and expose the parties to the risk of counterparty default.

Other risks relating to the Portfolio and investment strategy

(a) Changes in laws or regulations governing the Company's NAV and revenues

The Company is subject to laws and regulations enacted by, national and local governments (including EU laws and regulations incorporated into UK law by virtue of the EUWA or future similar enactments). In particular, the company is subject to and will be required to comply with certain regulatory requirements that are applicable to listed closed-ended investment companies.

Any changes in the law and regulation affecting the Company and its operations may have a material adverse effect on the ability of the Company to carry on its business and successfully pursue its investment policy and on the value of the Company and/or the Shares. In such event, the investment returns of the Company may be materially adversely affected.

(b) Changes in taxation legislation, or the rate of taxation

Any change in the tax status of the Company or in taxation legislation or practice in the United Kingdom or Japan (or elsewhere) could affect the value of the investments held by the Company or the Company's ability to achieve its investment objective or alter the after-tax returns to Shareholders. Statements in this Prospectus including in relation to the taxation of Shareholders and/or the Company are based upon current United Kingdom and Japanese law and published practice as at the date of this Prospectus, which law and practice is, in principle, subject to change (potentially with retrospective effect) that could adversely affect the ability of the Company to meet its investment objective and/or which could adversely affect the taxation of Shareholders and/or the Company and after tax returns to Shareholders.

Potential investors who are in doubt as to their tax position are urged to consult their tax advisers with respect to their particular tax situations and the tax effect of an investment in the Company.

Any change in accounting standards or accounting practice in the UK may adversely affect the value of the Company's assets and liabilities in its books of account or restrict the ability of the Company to pay dividends or distributions and/or buy back Ordinary Shares.

(d) Investment trust status

The Company has obtained from HMRC, and the Directors intend to continue to conduct the affairs of the Company so as to satisfy the conditions for, approval as an investment trust under Chapter 4 of Part 24 of the Corporation Tax Act 2010. A failure to maintain HMRC approval as an investment trust, including as a result of a change in tax law or practice, could result in the Company not being able to benefit from the current exemption for investment trusts from UK tax on chargeable gains and could affect the Company's ability to provide returns to Shareholders. It is not possible to guarantee that the Company will remain a company that is not a close company for UK tax purposes, which is a requirement to maintain status as an investment trust, as the Shares are freely transferable. The Company, in the unlikely event that it becomes aware that it is a close company, or otherwise fails to meet the criteria for approval as an investment trust company, will, as soon as reasonably practicable, notify Shareholders of this fact.

RISKS RELATING TO THE SHARES

The Rosenwald Clients currently hold, are expected to own at First Admission, and may retain in the medium or long term, a significant interest in the Company and, given the relationship between the Rosenwald Clients and the Investment Adviser, their interest may conflict with those of other Shareholders in certain circumstances

The Rosenwald Clients (described in greater detail in paragraph 5.5 of Part 14 (General Information) of this Prospectus) currently hold 40.35 per cent. of the total issued share capital of the Company. It is not expected that the Rosenwald Clients will participate in the Issue and that therefore their interests in the Company will be diluted to 16.43 per cent. of the total issued share capital of the Company (assuming that 150 million Ordinary Shares are issued pursuant to the Issue). In the event that the Company issues C Shares pursuant to the Issue, voting rights of the Rosenwald Clients would be diluted to 16.43 per cent. (assuming that 150 million C Shares are issued pursuant to the Issue). There will be no dilution of the Rosenwald Client's holding of Ordinary Shares until the conversion of those C Shares into Ordinary Shares. The dilution of the Rosenwald Client's holding at that point will be determined by the conversion ratio applied at that time.

James B. Rosenwald, III is the chief investment officer at Rising Sun. In addition to any influence acquired through this role with Rising Sun, James B. Rosenwald, III may be in a position to influence through the votes attaching to the Rosenwald Clients' shareholdings the outcome of matters relating to the Company, including approval of significant changes such as a change to the investment policy or the appointment or removal of Directors. In particular, this potential control may have the effect of making certain transactions more difficult to implement without the support of the Rosenwald Clients', and may have the effect of delaying or preventing decision making on significant matters relating to the Company. To the extent that the Rosenwald Clients' interests conflict with those of the other Shareholders, this may have a material adverse effect on the value of the Shares, the performance of the Company and the Company's returns to Shareholders.

Members of the Rosenwald Clients may, in certain circumstances, be required to make a mandatory offer under Rule 9 of the Takeover Code

If any member of the Rosenwald Clients acquired further Shares as a result of which the Rosenwald Clients either (i) increase their aggregate shareholdings in the Company to 30 per cent. or more; or (ii) to the extent that the Rosenwald Clients hold in excess of 30 per cent. of the issued share capital of the Company, increase their aggregate shareholdings to between 30 per cent. and 50 per cent. of the issued share capital of the Company at the relevant time, then a member of the Rosenwald Clients may be required to make a mandatory offer under Rule 9 of the Takeover Code, irrespective of its individual shareholding in the Company.

Risks relating to the Company's ability to declare and pay dividends

The Company's ability to declare and pay any future dividend is subject to the discretion of the Directors and will depend on, amongst other things, the Company pursuing successfully its investment strategy and the Company's distributable reserves, earnings, financial position, cash requirements level and rate of borrowings and availability of profit, as well as the provisions of relevant laws or generally accepted accounting principles from time to time.

Risks affecting the Shares

The value of an investment in the Company, and the income derived from it, if any, is subject to normal market fluctuations and other risks inherent in investing in securities. The market price of the Shares may rise or fall rapidly and the Shares may trade at a discount to the NAV attributable to them.

The market price of the Shares, like shares in all investment companies, may fluctuate independently of their underlying NAV and may trade at a discount or premium at different times, depending on factors such as supply and demand for the Shares, market or economic conditions and general investor sentiment. There can be no guarantee that any discount control policy will be successful or capable of being implemented. The market value of a Share may therefore vary considerably from its NAV.

An investor may not recover the amount originally invested. The Company can offer no assurance that its investments will generate gains or income or that any gains or income that may be generated on particular investments will be sufficient to offset any losses that may be sustained.

It may be difficult for Shareholders to realise their investment and a liquid market in the Shares may fail to develop

The price at which the Shares are traded and the price at which investors may realise their investment will be influenced by a large number of factors, some specific to the Company and its investments and some which may affect companies generally. Admission of the Shares to trading should not be taken as implying that there is or will be a liquid market for the Shares. Consequently, the share price may be subject to greater fluctuation on small volumes of trading of Shares and the Shares may be difficult to sell at a particular price. The market price of the Shares may not reflect their underlying Net Asset Value.

While the Directors retain the right to effect repurchases of Ordinary Shares in the manner described in this Prospectus, they are under no obligation to use such powers or to do so at any time and Shareholders should not place any reliance on the willingness of the Directors so to act. Shareholders wishing to realise their investment in the Company may therefore be required to dispose of their Shares in the market. There can be no guarantee that a liquid market in the Shares will be maintained or that the Shares will trade at prices close to their underlying NAV. Accordingly, Shareholders may be unable to realise their investment at such Net Asset Value or at all.

The number of Shares to be issued pursuant to the Issue or the Placing Programme is not yet known, and there may be a limited number of holders of such Shares. Limited numbers and/or holders of Shares may mean that there is limited liquidity in the Shares which may affect (i) an investor's ability to realise some or all of his investment and/or (ii) the price at which such investor can effect such realisation and/or (iii) the price at which the Shares trade in the secondary market.

Further issues of Shares

Subject to the passing of the Share Allotment Authorities at the General Meeting, the Directors have been authorised to issue up to 300 million Shares, less any Shares that are issued pursuant to the Issue, in connection with the Placing Programme without the application of pre-emption rights. The Directors also have an additional

residual authority, granted at the Company's 2021 AGM, to allot and issue up to 10,300,000 Ordinary Shares on a non pre-emptive basis. If the Directors decide to issue further Shares on a non-pre-emptive basis the proportions of the voting and economic rights held by holders of Shares on First Admission will be diluted on the issue of such shares as each Share carries the right to one vote and an equal proportion of the economic interests in the Company.

Risks relating to the C Shares

The NAV performance of the C Shares may diverge significantly from that of the Ordinary Shares between the admission of the C Shares to trading on the Specialist Fund Segment of the London Stock Exchange and conversion of the C Shares into Ordinary Shares in accordance with the Articles.

Trading liquidity in the C Shares may be lower than in the Ordinary Shares which may affect: (i) a Shareholders' ability to realise some or all of its investments; (ii) the price at which such Shareholder can effect such realisation; and/or (iii) the price at which the Shares trade in the secondary market. Accordingly, Shareholders may be unable to realise their investment in C Shares at Net Asset Value per Share or at all.

C Shares will represent interests in a segregated pool of assets and therefore C Shareholders will not, until conversion, have exposure to the Company's existing investments and C Shareholders' returns will be dependent on the deployment of cash raised in a timely manner.

Dividends will be declared on C Shares only in the event that there is material net income available for distribution to the C Shares.

Prospective investors should therefore consider carefully whether investment in the Company is suitable for them, in light of the risk factors outlined above, their personal circumstances and the financial resources available to them.

PART 2 IMPORTANT INFORMATION

In assessing an investment in the Company, investors should rely only on the information in this Prospectus. No person has been authorised to give any information or make any representations other than those contained in this Prospectus and, if given or made, such information or representations must not be relied on as having been authorised by the Company, the Directors, Rising Sun, Shore Capital or any other person. Neither the delivery of this Prospectus nor any subscription or purchase of Ordinary Shares and/or C Shares made pursuant to this Prospectus shall, under any circumstances, create any implication that there has been no change in the affairs of the Company since, or that the information contained therein is correct at any time subsequent to the date of this Prospectus.

In connection with the Initial Placing and any Subsequent Placing, Shore Capital or any of its affiliates acting as an investor for its or their own account(s) may subscribe for the Shares and, in that capacity, may retain, purchase, sell, offer to sell or otherwise deal for its or their own account(s) in such securities of the Company, any other securities of the Company or related investments in connection with the Initial Placing, any Subsequent Placing or otherwise. Accordingly, references in this Prospectus to the Shares being issued, offered, subscribed or otherwise dealt with, should be read as including any issue or offer to, or subscription or dealing by, Shore Capital or any of its affiliates acting as an investor for its or their own account(s). Neither of the Joint Runners intends to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligation to do so.

1. Regulatory information

This Prospectus does not constitute an offer to sell, or the solicitation of an offer to subscribe for or buy Ordinary Shares and/or C Shares in any jurisdiction in which such offer or solicitation is unlawful. The issue or circulation of this Prospectus may be prohibited in some countries.

Prospective investors should consider carefully (to the extent relevant to them) the notices to residents of various countries set out at pages 28 to 32 of this Prospectus.

The contents of the Website, and the contents of any websites which can be accessed through links on the Website, do not form part of this Prospectus. Investors should base their decision to invest on the contents of this Prospectus and any supplementary prospectus published by the Company prior to Admission alone and should consult their professional advisers prior to making any investment in the Shares.

2. Intermediaries Offer

Under the Intermediaries Offer, New Shares are being offered to Intermediaries who will facilitate the participation of their retail investor clients (and any member of the public who wishes to become a client of that Intermediary) located in the United Kingdom. The Company consents to the use of this Prospectus in connection with any subsequent resale or final placement of securities by financial intermediaries in the United Kingdom on the following terms: (i) in respect of the Intermediaries who are appointed by the Company prior to the date of this Prospectus, from the date of this Prospectus; and (ii) in respect of Intermediaries who are appointed by the Company after the date of this Prospectus, from the date on which they are appointed to participate in the Intermediaries Offer and agree to adhere to and be bound by the Intermediaries Terms and Conditions in each case, until the closing of the Intermediaries Offer. The offer period within which any subsequent resale or final placement of securities by Intermediaries can be made and for which consent to use this Prospectus is given commences on 28 October 2021 and closes at 12 p.m. on 22 November 2021, unless closed prior to that date (any such prior closure to be announced via a Regulatory Information Service). Prospective investors interested in participating in the Intermediaries Offer should apply for New Shares through the Intermediaries by following their relevant application procedures by no later than 12:00 p.m. on 22 November 2021. The Company and the Directors accept responsibility for the information contained in this Prospectus with respect to any purchaser of New Shares pursuant to the Intermediaries Offer.

Any Intermediary that uses this Prospectus must state on its website that it uses this document in accordance with the Company's consent and the conditions attached thereto. Intermediaries are required to provide the terms and conditions of the Intermediaries Offer at the time of such offer to any prospective investor who has

expressed an interest in participating in the Intermediaries Offer to such Intermediary. Any application made by investors to any Intermediary is also subject to the terms and conditions imposed by such Intermediary.

3. Investment considerations

The contents of this Prospectus are not to be construed as advice relating to legal, financial, taxation, investment or any other matter.

Prospective investors should inform themselves as to:

the legal requirements within their own countries for the purchase, holding, conversion, transfer or other disposal of Shares;
any foreign exchange restrictions applicable to the purchase, holding, conversion, transfer or other disposal of Shares which they might encounter; and
the income and other tax consequences which may apply in their own countries as a result of the purchase, holding, conversion, transfer or other disposal of Shares.

Prospective investors must rely upon their own representatives, including their own legal advisers and accountants, as to legal, tax, investment or any other related matters concerning the Company and an investment therein. It should be remembered that the price of securities and the income from them can go down as well as up.

An investment in the Company should be regarded as a long-term investment. There can be no assurance that the Company's investment objective will be achieved.

As past performance of investments managed and monitored by the Investment Adviser is not necessarily a guide to future performance and the value of an investment in the Company, and the income derived from it, if any, may go down as well as up, there can be no guarantee that the investment objective of the Company will be met. Therefore investors may not get back the full value of their investment.

Investors should not consider the track record information contained in this Prospectus to be indicative of the Company's or Rising Sun's future performance. Past performance is not a reliable indicator of future results and the Company will not make the same investments reflected in the track record information included herein.

The Company has a limited investment history. For a variety of reasons, the comparability of the track record information to the Company's future performance is by its nature very limited. Without limitation, results can be positively or negatively affected by market conditions beyond the control of the Company or Rising Sun which may be different in many respects from those that may prevail at present or in the future, with the result that the performance of portfolios originated now may be significantly different from those originated in the past.

This Prospectus should be read in its entirety before making any investment in the Ordinary Shares and/or C Shares. All Shareholders are entitled to the benefit of, are bound by, and are deemed to have notice of, the provisions of the Memorandum and Articles of Association of the Company which investors should review. Details of where the Memorandum and Articles of Association are displayed can be found in paragraph 14 of Part 14 (General Information) of this Prospectus.

The actual number of Ordinary Shares and/or C Shares to be issued pursuant to the Issue and the Placing Programme will be determined by the Company and Shore Capital after taking into account demand for the Ordinary Shares and/or C Shares and prevailing market conditions. In such event, the information in this Prospectus should be read in light of the actual number of Ordinary Shares and/or C Shares to be issued pursuant to the Issue and the Placing Programme.

Statements made in this Prospectus are based on applicable law and practice currently in force and are subject to changes therein.

4. Forward Looking Statements

This Prospectus includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms 'believes', "estimates", "plans", "projects", "anticipates", "expects", "intends", 'may', "will", or "should" or, in each case, their negative or other variations or comparable terminology. These forward looking statements include

matters that are not historical facts and include statements regarding the Company's intentions, beliefs or current expectations.

By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances that may or may not occur. A number of factors could cause actual results and developments to differ materially from those expressed or implied by the forward-looking statements including, without limitation, the facts described in the "Risk Factors" section of this Prospectus.

Forward-looking statements may and often do differ materially from actual results. Any forward-looking statements in this Prospectus reflect the Company's view with respect to future events as at the date of this Prospectus and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to the Company's operations and strategy. Save as required by applicable law, or regulatory requirements (including FSMA, the UK AIFM Directive, the EU AIFM Directive, the UK Prospectus Regulation, the EU Prospectus Regulation, the Prospectus Regulation Rules, the Takeover Code, the UK Market Abuse Regulation, the EU Market Abuse Regulation and the Disclosure Guidance and Transparency Rules) the Company is under no obligation publicly to release the results of any revisions to any forward-looking statements in this Prospectus that may occur due to any change in its exceptions or to reflect events or circumstances after the date of this Prospectus.

Given these uncertainties, investors and prospective investors are cautioned not to place any undue reliance on such forward-looking statements and should carefully consider the "Risk Factors" section of this Prospectus for a discussion of additional factors that could cause the Company's actual results to differ materially before making any investment decision.

Notwithstanding the foregoing, nothing contained in this Prospectus shall in any way be taken to qualify the working capital statement contained in paragraph 11 of Part 14 (General Information) of this Prospectus.

5. Presentation of financial information

The Company prepares its financial information under IFRS. The financial information contained or incorporated by reference in the Prospectus, including that financial information presented in a number of tables in the Prospectus, has been rounded to the nearest whole number or the nearest decimal place. Therefore, the actual arithmetic total of the numbers in a column or row in a certain table may not conform exactly to the total figure given for that column or row. In addition, certain percentages presented in the tables in the Prospectus reflect calculations based upon the underlying information prior to rounding, and, accordingly, may not conform exactly to the percentages that would be derived if the relevant calculations were based upon the rounded numbers.

6. Presentation of industry, market and other data

Information regarding markets, market size, market share, market position, growth rates and other industry data pertaining to the Company's business and the track record of the Company and the Investment Adviser contained in this Prospectus consists of estimates based on data and reports compiled by professional organisations and analysts, information made public by investment vehicles currently managed by the Investment Adviser (or affiliates of the Investment Adviser), or data from other external sources and on the Company's, the Directors' and the Investment Adviser's knowledge of public companies in Japan. Information regarding the macroeconomic environment has been compiled from publicly available sources. In many cases, there is no readily available external information (whether from trade associations, government bodies or other organisations) to validate market-related analyses and estimates, requiring the Company to rely on internally developed estimates. The Company takes responsibility for compiling, extracting and reproducing market or other industry data from external sources, including third parties or industry or general publications, but none of the Company, the Investment Adviser or Shore Capital has independently verified that data. The Company gives no assurance as to the accuracy and completeness of, and takes no further responsibility for, such data. Similarly, while the Company believes its and the Investment Adviser's internal estimates to be reasonable, they have not been verified by any independent sources and the Company cannot give any assurance as to their accuracy.

7. Currency presentation

Unless otherwise indicated, all references in this Prospectus to:

"GBP", "pounds sterling", "£", "pence" or "p" are to the lawful currency of the UK;

"US$" or "US Dollars" are to the lawful currency of the United States; and
"Yen", "JPY" or "JP¥" are to the lawful currency of Japan.

8. Restrictions on distribution

The distribution of this Prospectus may be restricted by law in certain jurisdictions. Persons in possession of this Prospectus are required to inform themselves about and to observe any such restrictions. This document may not be used for, or in connection with, and does not constitute an offer to sell or issue, or the solicitation of an offer to buy, subscribe or otherwise acquire, Shares in any jurisdiction where it would be unlawful, and in particular, subject to certain limited exceptions is not for release, publication or distribution in whole or in part, directly or indirectly, to U.S. Persons or into the United States, any member state of the EEA (other than any EEA member state where the Shares are lawfully marketed), Canada, Australia, the Republic of South Africa or Japan.

9. Information to distributors

Solely for the purposes of the product governance requirements of Chapter 3 of the FCA Handbook Product Intervention and Product Governance Sourcebook (the "UK Product Governance Requirements"), and/or any equivalent requirements elsewhere to the extent determined to be applicable, and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any manufacturer (for the purposes of the UK Product Governance Requirements and/or any equivalent requirements elsewhere to the extent determined to be applicable) may otherwise have with respect thereto, the Shares the subject of the Issue and Placing Programme have been subject to a product approval process, which has determined that such Shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each defined in Chapter 3 of the FCA Handbook Conduct of Business Sourcebook; and (ii) eligible for distribution through all permitted distribution channels (the "Target Market Assessment").

Notwithstanding the Target Market Assessment, distributors should note that: the price of the Shares may decline and investors could lose all or part of their investment; the Shares offer no guaranteed income and no capital protection; and an investment in the Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to any contractual, legal or regulatory selling restrictions in relation to the Issue or the Placing Programme. Furthermore, it is noted that, notwithstanding the Target Market Assessment, Shore Capital will only procure investors who meet the criteria of professional clients and eligible counterparties.

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of Chapters 9A or 10A respectively of the FCA Handbook Conduct of Business Sourcebook; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Shares.

Each distributor is responsible for undertaking its own target market assessment in respect of the Shares and determining appropriate distribution channels.

10. UK PRIIPs Regulation

In accordance with the UK PRIIPs Regulation, Key Information Documents in respect of an investment in the Ordinary Shares and C Shares respectively have been prepared and are available to investors at the Company's website. The content of each of the Key Information Documents is highly prescriptive, both in terms of the calculations underlying the numbers and the narratives, with limited ability to add further context or explanation. As such, the Key Information Documents should be read in conjunction with other material produced by the Company, including this Prospectus and the Company's annual reports which are and will be available on the Company's website.

To the extent that Shares are to be made available to retail investors in the EEA, the Company will make available Key Information Documents under the EU PRIIPs Regulation as required.

11. Taxation

A summary of certain limited aspects of UK and Japan taxation applicable to the Company and Shareholders is contained in Part 13 (United Kingdom and Japanese Taxation) of this Prospectus. If any potential investor is in any doubt about the tax consequences of his/her acquiring, holding, disposing or conversion of Shares, he/she should seek advice from his/her own independent professional advisers.

12. Overseas investors

If you receive a copy of this Prospectus in any territory other than the United Kingdom you may not treat it as constituting an invitation or offer to you. It is your responsibility, if you are outside the United Kingdom and wishing to make an application for Shares, to satisfy yourself that you have fully observed the laws of any relevant territory or jurisdiction in connection with your application, including obtaining any requisite governmental or other consents, observing any other formalities requiring to be observed in such territory and paying any issue, transfer or other taxes required to be paid in such territory. The Company reserves the right, in its absolute discretion, to reject any application received from outside the United Kingdom.

Without limiting the above, the Shares may not be offered, sold or delivered, directly or indirectly, within any EEA State (other than any EEA member state where the Shares are lawfully marketed), Canada, Australia, the Republic of South Africa, Japan or in the United States, or to or for the account or benefit of U.S. Persons, except in reliance on, or in a transaction not subject to, the registration requirements under the Securities Act or the securities laws of any state or other jurisdiction of the United States. If you subscribe for Shares you will, unless the Company agrees otherwise in writing, be deemed to represent and warrant to the Company and its agents that you are not in any EEA State (other than any EEA member state where the Shares are lawfully marketed), Canada, Australia, the Republic of South Africa, Japan or the United States and are not a U.S. Person or subscribing for the account or benefit of a U.S. Person. No application will be accepted if it bears an address in any EEA State (other than any EEA member state where the Shares are lawfully marketed), Canada, Australia, the Republic of South Africa, Japan or the United States or appears to have been posted from any EEA State (other than any EEA member state where the Shares are lawfully marketed), Canada, Australia, the Republic of South Africa, Japan or the United States or otherwise where there is cause to believe you are in any EEA State (other than any EEA member state where the Shares are lawfully marketed), Canada, Australia, the Republic of South Africa, Japan or the United States or a U.S. Person or subscribing for the account or benefit of a U.S. Person.

13. Compulsory transfer provisions

Although the Shares are freely transferable, there are certain circumstances in which the Board may, under the Articles and subject to certain conditions, compulsorily require the transfer of the Shares. These circumstances, which principally apply only to U.S. Persons or investors located in the United States who might purchase Shares in the market, including where a transfer of Shares would cause, or is likely to cause: (i) the assets of the Company to be considered "plan assets" under the Plan Asset Regulations; (ii) the Company to be required to register under the Investment Company Act, or the Investment Adviser or members of the senior management of the Company to be required to register as "investment advisers" under the Investment Advisers Act; (iii) the Company to be required to register under the Exchange Act or any similar legislation, amongst others; or (iv) the Company to be unable to comply with its obligations under the Foreign Account Tax Compliance Provisions (commonly known as FATCA).

These procedures may materially affect the time and a price that they may deem appropriate to transfer such Shares.

14. International tax regimes, FATCA, and other tax information reporting and exchange regimes

TO ENSURE COMPLIANCE WITH UNITED STATES TREASURY DEPARTMENT CIRCULAR 230, EACH PROSPECTIVE INVESTOR IS HEREBY NOTIFIED THAT: (A) ANY DISCUSSION OF U.S. TAX ISSUES HEREIN IS NOT INTENDED TO BE RELIED UPON, AND CANNOT BE RELIED UPON, BY A PROSPECTIVE INVESTOR FOR THE PURPOSE OF AVOIDING PENALTIES THAT MAY BE IMPOSED ON SUCH PROSPECTIVE INVESTOR UNDER APPLICABLE TAX LAW; (B) SUCH DISCUSSION IS INCLUDED HEREIN IN CONNECTION WITH THE PROMOTION OR MARKETING (WITHIN THE MEANING OF TREASURY DEPARTMENT CIRCULAR 230) OF THE OFFER TO SELL SHARES BY THE COMPANY; AND (C) A PROSPECTIVE INVESTOR IN SHARES SHOULD SEEK ADVICE BASED ON ITS PARTICULAR CIRCUMSTANCES FROM AN INDEPENDENT ADVISOR.

The Foreign Account Tax Compliance provisions (commonly known as “FATCA”) are U.S. provisions contained in the U.S. Hiring Incentives to Restore Employment Act 2010. FATCA is aimed at reducing tax evasion by U.S. citizens.

FATCA imposes a withholding tax of 30 per cent. on (i) certain U.S. source interest, dividends and certain other types of income; and (ii) the gross proceeds from the sale or disposition of assets which produce U.S. source interest or dividends, which are received by a foreign financial institution (“FFI”), unless the FFI complies with certain reporting and other related obligations under FATCA. The UK has concluded an intergovernmental agreement (“IGA”) with the U.S., pursuant to which parts of FATCA have been effectively enacted into UK law.

Under the IGA, a FFI that is resident in the UK (a “Reporting FI”) is not subject to withholding under FATCA provided that it complies with the terms of the IGA, including requirements to register with the IRS and requirements to identify, and report certain information on, accounts held by U.S. persons owning, directly or indirectly, an equity or debt interest in the Company (other than equity and debt interests that are regularly traded on an established securities market, for which see below), and report on accounts held by certain other persons or entities to HMRC.

The Company is treated as a Reporting FI pursuant to the IGA and complies with the requirements under the IGA. The Ordinary Shares, in accordance with current HMRC practice, comply with the conditions set out in the IGA to be “regularly traded on an established securities market” meaning that the Company does not have to report specific information on its Shareholders and their investments to HMRC. However, there can be no assurance that the Company will continue to be treated as a Reporting FI, that the Ordinary Shares will continue to be considered to be “regularly traded on an established securities market”, that the C Shares will become “regularly traded on an established securities market” or that it would not in the future be subject to withholding tax under FATCA or the IGA. If the Company becomes subject to a withholding tax as a result of FATCA or the IGA, the return on investment of some or all Shareholders may be materially adversely affected.

Since the enactment of FATCA, other jurisdictions have entered into similar information exchange agreements. The Organisation for Economic Co-operation and Development (the “OECD”) has developed a global Common Reporting Standard (the “CRS”) for multilateral exchange of information. The UK has implemented the CRS and so the Company will have to provide information about its Shareholders to HMRC under these rules.

The EU has introduced a new pan-European mandatory tax disclosure regime in respect of cross-border arrangements which possess certain features. These new rules (widely referred to as “DAC 6”) have a broad scope and have the potential to require disclosure of information in a wide range of circumstances. On 31 December 2020, having previously legislated to implement DAC 6 in full in the UK, the UK government published legislation to narrow the scope of mandatory reporting under DAC 6 in the UK. Also on that date, HMRC announced that, in the coming year, the UK government would repeal the legislation implementing DAC 6 in the UK and implement the OECD’s Mandatory Disclosure Rules as soon as practicable, in order to transition to international, rather than EU standards on tax transparency. There remains a degree of uncertainty as to how the UK will interpret those parts of DAC 6 that it has implemented and its interpretation may differ from that applied in EU Member States. In addition, there remains a degree of uncertainty as to how different EU Member States will implement and interpret DAC 6 and such implementation and interpretation may vary between them.

As a result of FATCA, CRS and other tax information reporting and exchange regimes, Shareholders will be required to provide certain information to the Company so that the Company can comply with its reporting obligations. In particular, Shareholders will be required to provide – and the Company may be obliged to disclose – details and information about Shareholders (and persons connected or associated with them) as may be required to enable the Company or any of its associates to comply with their obligations to any tax, regulatory or comparable authorities (including pursuant to FATCA or CRS) or where the Company believes such that such disclosure is in the interests of the Company. Any failure to do so may result in such Shareholder being subject to adverse consequences (in accordance with the Articles of Association).

Although the Company complies with the rules imposed by FATCA, CRS and other tax information reporting and exchange regimes, the Company cannot guarantee that it will be able to satisfy its obligations under such regimes. Prospective investors and Shareholders are encouraged to consult their own tax advisors regarding the possible implications of FATCA and other tax information reporting and exchange regimes to their investment in the Company.

The OECD published its final reports in relation to its Action Plan on Base Erosion and Profit Shifting (“BEPS”) on 5 October 2015, which were endorsed at the G20 summit in November 2015. Jurisdictions are now considering their domestic responses to BEPS. Depending on how BEPS is introduced, changes to tax laws based on

recommendations made by the OECD in relation to BEPS may, for example, result in: the restriction or loss of existing access by the Company to tax relief under applicable double taxation agreements; or restrictions on permitted levels of deductibility of expenses (such as interest) for tax purposes. Such effects could lead to additional tax being suffered by the Company which may adversely affect the value of the Shares and investor returns. There could also be additional tax reporting and disclosure obligations.

A number of jurisdictions have already implemented certain BEPS measures. For example, the UK has introduced anti-hybrid legislation. These rules are highly complex, and may give rise to additional tax for the Company or the restriction of deductions otherwise available to the Company.

In addition, the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (Multilateral Instrument or MLI), which was the subject of a signing ceremony on 7 June 2017, is intended to facilitate the speedy introduction by participating states of double tax treaty-related BEPS recommendations. This may limit the extent to which Company is able to obtain double tax treaty benefits.

On 1 July 2021, the OECD announced that 130 countries and jurisdictions had agreed a two pillar solution to address the tax challenges arising from the digitalisation of the economy and that a detailed implementation plan together with remaining issues would be finalised by October 2021, with implementation to follow in 2023. The proposals are complex and are yet to be finalised, but, in high level terms, it is expected that:

'Pillar One' will re-allocate some taxing rights over certain multinational enterprises ("MNEs") from their home countries to the markets from which they derive revenue of at least €1m (or, for smaller jurisdictions with GDP lower than €40 billion, at least €250,000), regardless of whether they have a physical presence there. MNEs will potentially be within the scope of Pillar One if they have a global turnover above €20 billion and profitability above 10%. The turnover threshold is to be reduced to €10 billion, contingent on successful implementation.; and
'Pillar Two' will include Global anti-Base Erosion Rules ("GloBE") under which a global minimum tax rate of at least 15% is to be introduced for MNEs that meet the €750m revenue threshold for country-by-country reporting, subject to various exclusions. In addition to the GloBE proposals, Pillar Two will introduce new rules allowing jurisdictions to impose limited source taxation on certain related party payments that will be subject to tax below a minimum rate.

Depending on how the proposals for the two pillars are developed, and on how such proposals are implemented by various jurisdictions, there may be a material impact on the taxation of the Company and/or companies in the Portfolio, and the taxation of returns to investors.

The U.K. has implemented two corporate criminal offenses: failure to prevent facilitation of U.K. tax evasion and failure to prevent facilitation of overseas tax evasion. Liability under these offences can be mitigated where the relevant business has in place reasonable prevention procedures. The scope of these offences is extremely wide and could have an impact on the Company.

15. Investor profile

The typical investors for whom the Shares are intended are institutional investors, professional investors, professionally advised and knowledgeable investors and financially sophisticated non-advised private investors who fall within the criterion above who are capable themselves of evaluating the merits and risks of an investment in the Company and who have sufficient resources both to invest in potentially illiquid securities and to be able to bear any losses (which may equal the whole amount invested) that may result from the investment. Such investors may wish to consult an independent financial adviser prior to investing in the Shares. The Specialist Fund Segment is intended for investment products targeted at institutional, professional, professionally advised and knowledgeable investors.

16. Data Protection

The Company will process personal data provided by an investor at all times in compliance with material requirements of applicable data protection legislation (including the GDPR and the DP Act) in the United Kingdom and/or the EEA, as appropriate ("DP Legislation") and shall only process such information for the purposes set out in the Company's privacy policy (the "Purposes") which is available for consultation on the Company's website (the "Privacy Policy").

Where necessary to fulfil the Purposes, the Company may disclose personal data to:

(a) third parties located either within, or outside of, the United Kingdom and/or the EEA, for the Registrar and the Administrator to perform their respective functions and in particular in connection with the holding of Shares; or
(b) the Registrar, the Administrator, the AIFM, Rising Sun and their respective Associates, some of which are located outside of the United Kingdom and/or the EEA.

Any sharing by the Company of personal data with third parties will be carried out in compliance with DP Legislation and as set out in the Company's Privacy Policy.

Each investor acknowledges that by submitting his or her personal data to the Registrar (acting for and on behalf of the Company) where the investor is a natural person he or she represents and warrants that (as applicable) he or she has read and understood the terms of the Company's Privacy Policy and shall provide consent to the processing of his/her personal data for the Purposes where such consent is required.

Each investor hereby represents and warrants to the Company, the Registrar and the Administrator that by submitting personal data that is not the investor's own personal data to the Registrar (acting for and on behalf of the Company):

(a) it has brought the Company's Privacy Policy to the attention of any underlying data subjects on whose behalf or account the investor may act or whose personal data will be disclosed to the Company and the Administrator as a result of the investor agreeing to subscribe for Shares under the Issue and has provided such underlying data subjects with details of the Purposes for which their personal data will be used;
(b) where consent is required under DP Legislation, the investor has obtained the consent of any data subject to the Company, the Administrator and the Registrar and their respective affiliates and group companies, processing their personal data for the Purposes; and
(c) the investor has complied in all other respects with all applicable DP Legislation in respect of disclosure and provision of personal data to the Company.

Where any investor acts for or on account of an underlying data subject or otherwise discloses the personal data of an underlying data subject, the relevant investor shall, in respect of the personal data the relevant investor processes in relation to or arising in relation to the Issue:

(a) if required, agree with the Company, the Administrator and the Registrar (as applicable), the responsibilities of each such entity as regards responding to data subjects' rights and to communications with a data protection regulator; and
(b) immediately on demand, fully indemnify the Company, the Administrator, the Registrar, the AIFM and Rising Sun (as applicable) and keep them fully and effectively indemnified against all costs, demands, claims, expenses (including legal costs and disbursements on a full indemnity basis), losses (including indirect losses and loss of profits, business and reputation), actions, proceedings and liabilities of whatsoever nature arising from or incurred by the Company, the Administrator, the Registrar, the AIFM and/or Rising Sun in connection with any failure by the investor to comply with the provisions set out in this section "Data Protection".

17. Governing Law

Unless otherwise stated, statements made in this Prospectus are based on the law and practice currently in force in England and Wales and are subject to changes therein.

18. Restrictions on Shareholder participation in future equity offerings

Shareholders in certain jurisdictions, particularly the United States, may not be entitled to participate in future equity offerings or exercise these rights unless any relevant rights and Shares are registered under their applicable laws or an exemption from registration is available. The Company cannot, at this point, predict whether it would seek such registrations or whether any such exemption would be available. The Company intends to evaluate, at the time of any equity offering, the costs and potential benefits to the Company of enabling Shareholders in those jurisdictions to participate and any other factors it considers appropriate at the time and then to make a decision as to whether to file such a registration statement or seek to utilise any

applicable exemptions. The Company cannot assure investors outside the United Kingdom that they will be able to participate in future equity offerings.

The securities laws of certain jurisdictions, particularly the United States, may restrict the Company's ability to allow Shareholders to participate in any discretionary pre-emptive offer by the Company of Shares in the future. There can be no assurance that the Company would be able to conduct any such offer in a manner that would enable participation therein or receipt of the cash proceeds thereof by Shareholders in such jurisdictions. Shareholders who have a registered address in or who are resident or located in (as applicable) countries other than the United Kingdom should consult their professional advisers as to whether they require any governmental or other consents or need to observe any other formalities to enable them to participate in any such discretionary pre-emptive offer.

19. Other

The Company will not pay commission to third parties that advise investors to subscribe for Shares in the Company. In relation to the Initial Placing, the New Shares will be issued to Placees at the Issue Price and no commission will be paid to any third parties that advise investors in respect of such issues under the Initial Placing. In relation to the Placing Programme, the Ordinary Shares and C Shares (as applicable) will be issued fully paid to Placees at the applicable Placing Programme Price and no commission will be paid to any third parties that advise investors in respect of such issues under the Placing Programme.

This Prospectus has been approved by the FCA as a prospectus which may be used to offer securities to the public for the purposes of section 85 of FSMA and the UK Prospectus Regulation. No arrangement has however been made with the competent authority in any EEA State (or any other jurisdiction) for the use of this Prospectus as an approved prospectus in such jurisdiction and accordingly no public offer is to be made in such jurisdictions.

PART 3

VOLUNTARY COMPLIANCE WITH THE LISTING RULES

The Company's existing Ordinary Shares are, and applications will be made to the London Stock Exchange for all of the Shares to be issued pursuant to the Issue and the Placing Programme to be, admitted to trading on the Specialist Fund Segment. As such, the Listing Rules applicable to closed-ended investment companies which are listed on the premium listing segment of the Official List of the FCA do not apply to the Company.

The Company will remain subject to the admission and disclosure standards of the London Stock Exchange whilst the Shares are admitted to trading on the Specialist Fund Segment. The Company will also be subject to the UK Market Abuse Regulation and the Disclosure Guidance and Transparency Rules. In addition, the Directors have resolved that, as a matter of good corporate governance, the Company will continue to voluntarily comply with the following key provisions of the Listing Rules:

(a) The Company is not required to comply with the Listing Principles set out at Chapter 7 of the Listing Rules. Nonetheless, the Company complies and intends to continue to comply with these Listing Principles.

(b) The Company is not required to appoint a listing sponsor under Chapter 8 of the Listing Rules. It has appointed Shore Capital as financial adviser to guide the Company in understanding and meeting its responsibilities in connection with First Admission any Subsequent Admission, the Issue and the Placing Programme and also for compliance with Chapter 10 of the Listing Rules (as and when applicable) and on the basis set out in (c) below.

(c) The Company is not required to comply with the provisions of Chapter 9 of the Listing Rules regarding continuing obligations. The Company intends however to continue to comply with all of the provisions of Chapter 9 of the Listing Rules.

(d) The Company is not required to comply with the provisions of Chapter 10 of the Listing Rules relating to significant transactions. The Company intends, however, to continue to comply with the provisions of Chapter 10 of the Listing Rules, save when entering into transactions which are in accordance with its investment policy.

(e) The Company is not required to comply with the provisions of Chapter 11 of the Listing Rules regarding related party transactions. Nonetheless, in circumstances where the Company, would, if it were complying with Chapter 11 of the Listing Rules, require shareholder consent in respect of any such transaction the Company has adopted a related party policy (in relation to which Shore Capital, as financial adviser, will guide the Company). The policy shall apply to any transaction which it may enter into with:

(i) any “substantial shareholder” (as defined in Listing Rule 11.1.4A) (other than: (a) any related party transaction with “substantial shareholders” under Listing Rule 11.1.5(2) regarding co-investments or joint provision of finance; or (b) issues of new securities in, or a sale of treasury shares of, the Company to “substantial shareholders” on terms which are more widely available, for example as part of an offer to the public or a placing to institutional investors);

(ii) any Director;

(iii) the Investment Adviser; and

(iv) any affiliates of such persons,

where (in each case) such transaction would constitute a “related party transaction” as defined in Chapter 11 of the Listing Rules. In accordance with its related party policy, the Company shall deal with such related party transactions in accordance with Chapter 11 of the Listing Rules with appropriate modifications in relation to Chapter 11 requirements to provide information, confirmation and undertakings to the FCA.

(f) The Company is not required to comply with the provisions of Chapter 12 of the Listing Rules regarding market repurchases by the Company of its Shares. Nonetheless, the Company has adopted a policy consistent with the provisions of Listing Rules 12.4.1 and 12.4.2, as more particularly described in the

section headed "Share buybacks" in paragraph 11 of Part 6 (Information on the Company) of this Prospectus.

(g) The Company is not required to comply with the provisions of Chapter 13 of the Listing Rules regarding contents of circulars. The Company intends however to continue to comply with the following provisions of Chapter 13 of the Listing Rules: (i) Listing Rule 13.3 (Contents of all circulars); (ii) Listing Rule 13.4 (Class 1 circulars); (iii) Listing Rule 13.5 (Financial information in Class 1 circulars); (iv) Listing Rule 13.6 (Related Party circulars); (v) Listing Rule 13.7 (Circulars about purchase of own equity shares); and (vi) Listing Rule 13.8 (Other circulars).

(h) The Company is not required to comply with the provisions of Chapter 15 of the Listing Rules (Closed-Ended Investment Funds: Premium listing). Nonetheless, the Company intends to continue to comply with the following provisions of Chapter 15 of the Listing Rules: Listing Rule 15.4.1A to Listing Rule 15.4.11 (Continuing obligations).

The Company has adopted a share dealing code for the Directors and the Board is responsible for taking all proper and reasonable steps to ensure compliance with the share dealing code by the Directors.

The Specialist Fund Segment securities are not admitted to the Official List. Therefore the Company has not been required to satisfy the eligibility criteria for admission to listing on the Official List and is not required to comply with the Listing Rules. The London Stock Exchange has not examined or approved the contents of this document.

It should be noted that the FCA does not have the authority to monitor the Company's voluntary compliance with the Listing Rules applicable to closed-ended investment companies which are listed on the Specialist Fund Segment nor will it impose sanctions in respect of any failure of such compliance by the Company.

FCA-authorised firms conducting designated investment business with retail customers under COB Rules are reminded that securities admitted to trading on the Specialist Fund Segment will be securities that may have characteristics such as: (i) variable levels of secondary market liquidity; (ii) sophisticated corporate structures; (iii) highly leveraged structures; and (iv) sophisticated investment propositions with concentrated risks and are therefore intended for institutional, professional and highly knowledgeable investors.

PART 4

EXPECTED TIMETABLE, STATISTICS AND DEALING CODES

Expected timetable of principal events

Prospectus published	28 October 2021
Initial Placing, Offer for Subscription and Intermediaries Offer opens	28 October 2021
General Meeting	2:00 p.m. on 12 November 2021
Form of New Shares allotted pursuant to the Issue announced	on or around 12 November 2021
Latest time and date for receipt of Application Forms under the Offer for Subscription and payment in full or settlement of the relevant CREST instruction	1:00 p.m. on 18 November 2021
Latest time and date for receipt of Initial Placing orders	12:00 p.m. on 22 November 2021
Latest time and date for receipt of applications from Intermediaries in respect of the Intermediaries Offer	12:00 p.m. on 22 November 2021
Results of the Initial Placing, Offer for Subscription and Intermediaries Offer announced	23 November 2021
First Admission of the New Shares to be issued pursuant to the Issue to the Specialist Fund Segment and dealings commence	8:00 a.m. on 25 November 2021
CREST accounts credited in respect of New Shares issued in uncertificated form	as soon as practicable after 8:00 a.m. on 25 November 2021
Certificates despatched in respect of New Shares issued in certificated form	week commencing 29 November 2021
Placing Programme opens	29 November 2021
Placing Programme closes	24 October 2022

Notes:
(1) References to times above and in this Prospectus generally are to London times unless otherwise specified.
(2) All times and dates in the expected timetable and in this Prospectus may be adjusted by the Company in consultation with Shore Capital. Any material changes to the timetable will be notified via an RIS.

Illustrative Issue statistics

Issue price per C Share¹	100p
Target number of New Shares to be issued by the Company pursuant to the Issue²	150 million
Target gross proceeds from the Issue	£150 million
Estimated Net Asset Value per C Share on First Admission¹	98p

1 The estimated Net Asset Value per Ordinary Share will depend on the performance of the Company’s portfolio. The Issue Price per Ordinary Share will be announced through the Regulatory Information Service.
2 The Directors have reserved the right, in consultation with Shore Capital, to increase the size of the Issue by up to 150 million New Shares if overall demand exceeds 150 million C Shares. Any such increase will be announced through an RNS announcement.

Illustrative Placing Programme Statistics

Maximum number of Ordinary and/or C Shares
300 million (inclusive of any New Shares issued pursuant to the Initial Placing, Offer for Subscription and Intermediaries Offer)

Placing Programme Price per New Ordinary Share
Not less than the last published cum income Net Asset Value per Ordinary Share at the time of issue plus a premium intended to at least cover associated issue costs (which are estimated at 1.3% per cent. of the gross proceeds of the relevant Subsequent Placing under the Placing Programme)

Placing Programme Price per C Share
100 pence

Dealing Codes

Ordinary Shares
ISIN GB00BKLGLS10
SEDOL BKLGLS1
Ticker NAVF

C Shares¹
ISIN GB00BKLGLT27
SEDOL BKLGLT2
Ticker NAVC

Legal Entity Identifier of the Company
213800JOFEGZJYS21P75

¹ The C Share codes only apply to the C Shares to be issued pursuant to the Issue. The relevant codes for any tranches of C Shares to be issued under the Placing Programme will be published by the Company at the appropriate time.

PART 5 DIRECTORS, INVESTMENT ADVISER AND ADVISERS

Directors*

Rosemary Morgan (Chair)
Ayako Weissman
Rachel Hill
Chetan Ghosh
Alicia Ogawa

All directors are appointed on a non-executive basis

Registered office of the Company

1st Floor
Senator House
85 Queen Victoria Street
London
EC4V 4AB

AIFM

International Fund Management Limited
Sarnia House
Le Truchot
St Peter Port
Guernsey, GY1 1GR
Telephone: +44 (0) 1481 737600
E-Mail: [email protected]
Website: www.intfundmanagement.com

Authorised and Regulated by Guernsey Financial Services Commission

Investment Adviser

Rising Sun Management Ltd.
c/o Appleby Global Services (Cayman) Limited
71 Fort Street
PO Box 500
George Town, Grand Cayman
KY1-1106, Cayman Islands
Telephone: +1 345 769 4900

Financial adviser and Sole Bookrunner

Shore Capital & Corporate Limited
Cassini House
57 St James's Street
London SW1A 1LD

Authorised and Regulated by the Financial Conduct Authority under the Financial Services and Markets Act 2000

Custodian

The Northern Trust Company
50 Bank Street
Canary Wharf
London E14 5NT
Telephone: +44 (0)20 7982 2000
E-Mail: [email protected]
Website: www.northerntrust.com

Authorised and regulated by the Financial Conduct Authority under the Financial Services and Markets Act 2000

Administrator and company secretary
PraxisIFM Fund Services (UK) Limited
1st Floor
Senator House
85 Queen Victoria Street
London
EC4V 4AB
Website: www.praxisifm.com

Legal advisers to the Company
Travers Smith LLP
10 Snow Hill
London
EC1A 2AL

Legal advisers to Shore Capital
Charles Russell Speechlys LLP
5 Fleet Place
London
EC4M 7RD

Registrars
Computershare Investor Services PLC
The Pavilions
Bridgwater Road
Bristol
BS99 6ZY

Receiving Agent
Computershare Investor Services PLC
Corporate Actions Projects
Bristol
BS99 6AH

Principal bankers
The Northern Trust Company
50 Bank Street
Canary Wharf
London
E14 5NT

Prime Broker
J.P. Morgan Securities PLC
25 Bank Street
Canary Wharf
London
E14 5JP

PART 6

INFORMATION ON THE COMPANY

Introduction

The Company is a closed-ended investment company incorporated on 22 October 2019 in England and Wales with registered number 12275668 and registered as an investment company under Section 833 of the Act. The Company carries on business as an investment trust within the meaning of Chapter 4 of Part 24 of the Corporation Tax Act 2010, as amended.

The Company's Ordinary Shares were first admitted to trading on the Specialist Fund Segment on 21 February 2020. On the IPO Admission Date, 103,000,000 Ordinary Shares were issued and admitted to trading on the Specialist Fund Segment at 100p per share. Rosenwald Capital was responsible for all IPO costs and therefore the net proceeds of the Company's initial public offering were £103 million.

Application will be made to the London Stock Exchange for any Shares issued pursuant to this Prospectus to be admitted to the Specialist Fund Segment.

The Company has a board of non-executive directors, all of whom are considered to be independent. The Company does not have any managing directors. The Company has appointed International Fund Management Limited as alternative investment fund manager to provide overall portfolio and risk management services to the Company. The AIFM and the Company have appointed Rising Sun as the investment adviser to provide investment advisory services to the AIFM and the Company in relation to its portfolio of investments. Further information on Rising Sun and the AIFM is set out in Part 7 (Directors, Management and Administration) of this Prospectus.

Investment opportunity

The Directors believe that an investment in the Company offers the potential following attractive characteristics:

Investment objective: the Company aims to provide Shareholders with attractive capital growth through its investment in a focussed portfolio of quoted Japanese securities (although the Company may, in certain limited circumstances, make investments in unquoted companies provided that the Company's aggregate interest in unquoted investments at the time of any such investment is not more than 10 per cent. of the Company's Net Asset Value at that time).
Investment strategy: the Board, as a consequence of recent regulatory and governance changes in Japan, consider it to be the right time to operate a dedicated activist vehicle focused on Japanese listed equities which pursues superior returns and increased dividends for shareholders in the companies in which it invests.
Experienced team: the Company has the benefit of the track record of the Rising Sun Management Team which has more than 50 years' collective investment experience and a deep understanding of activist investor strategies. Rising Sun comprises a team with significant experience in Japan.
Identified investments: In addition to the Company's existing Portfolio, Rising Sun has identified a number of potential further investee companies which fulfil the Company's determined investment criteria and which it considers to be suitable for activist shareholder engagement. Consequently, the Company would expect to have deployed substantially all of the proceeds of the Issue within six months of First Admission.
Board: the Board, chaired by Rosemary Morgan, is comprised of individuals from relevant and complementary backgrounds offering fund management (including Japanese fund management), activist experience (including in relation to Japanese equities), and risk, compliance and capital markets experience.
Issue and Placing Programme: the Company is targeting an issue of up to 150 million C Shares pursuant to the Issue, comprising of the Initial Placing, the Offer for Subscription and the Intermediaries Offer at the Issue Price (being 100p per C Share). Following the Issue, the Directors intend to implement the Placing Programme to enable the Company to raise additional capital in the period of 12 months from publication of this Prospectus to pursue acquisition opportunities that are in accordance with the Company's investment objective and policy.

Leverage: the Company may, once the proceeds of the Issue have been fully invested, introduce leverage to the Portfolio. The Company may maintain gearing at a level which the Directors, the AIFM and Rising Sun consider to be appropriate and borrow an amount not exceeding 20 per cent. of the Company's Net Asset Value at the time of drawdown.
Issue cost: the costs of the Issue payable by the Company are not expected to exceed two per cent. of the gross proceeds of the Issue.

3. Investment objective and policy

3.1 Investment objective

The investment objective of the Company is to provide Shareholders with attractive capital growth through the active management of a focussed portfolio of quoted companies which have the majority of their operations in, or revenue derived from, Japan and that have been identified by the Investment Adviser as being undervalued.

3.2 Investment policy

The Company's investment policy is to invest in a highly concentrated portfolio of shares issued by quoted companies which have the majority of their operations in, or revenue derived from, Japan and which the Investment Adviser deems attractive and undervalued and typically where (i) cash constitutes a significant proportion of the investee company's market capitalisation; and (ii) the relevant company has no controlling or majority shareholders.

The Board will not set any limits on sector weightings or stock selection within the portfolio. The Board applies the following restrictions on the size of its investments:

not more than 30 per cent. of the Gross Asset Value at the time of investment will be invested in the securities of a single issuer (such restriction does not, however, apply to investment of cash held for working capital purposes and pending investment or distribution in near cash equivalent instruments including securities issued or guaranteed by a government, government agency or instrumentality of any EU or OECD Member State or by any supranational authority of which one or more EU or OECD Member States are members); and
the value of the four largest investments at the time of investment will not constitute more than 75 per cent. of the Gross Asset Value.

The Company will not be constrained by any index benchmark in its asset allocation.

Additionally, while the Company intends that the majority of its investments will be in quoted companies, it may also make investments in unquoted companies and the Company may become invested in unquoted companies as a result of corporate actions or commercial transactions undertaken by quoted companies. The Company will only make investments in unquoted companies in order to maintain or improve its position in relation to a business which operated through a quoted entity at the time of the Company's initial investment in that business. In any event, the Company will only make an investment in an unquoted company if the aggregate interest of the Company in unquoted companies at the time of such investment is not more than 10 per cent. of the Net Asset Value of the Company at that time. This will mean that, if a quoted portfolio company is delisted or an unquoted investment is revalued with the effect of increasing the Company's interest in unquoted investments above 10 per cent. of the Company's Net Asset Value at that time, the Company will not be in breach of its investment policy and will not have to divest itself of any unquoted investments. However, while the Company's interest in unquoted investments remains above 10 per cent. of its Net Asset Value, the Company will not be able to make any further investments in unquoted companies.

Investment restrictions

There are no restrictions placed on the market capitalisation of investee companies, but it is expected that the portfolio will continue to be weighted towards small cap companies with market capitalisations of up to US$1 billion. Once fully invested after the Issue, the Portfolio is expected to have up to 20 holdings although there is no guarantee that this will be the case and it may contain a lesser or greater number of holdings at any time. As at the date of this Prospectus, the Portfolio contains 20 holdings.

Although, to date, the Company's investments have comprised minority stakes of typically 1.0 to 6.0 per cent. in investee companies (which can constitute an aggregate stake of up to approximately 10 per cent. including the Co-Invest Entities), the Company intends to acquire large minority stakes of typically 4.9 to 25.0 per cent. in each investee company. Nevertheless, in certain limited circumstances the Company may acquire a larger stake in an investee company if the investment case so warrants. The Company will not, however, acquire any stake which could cause a change in its status as an investment trust under Chapter 4 of Part 24 of the Corporation Tax Act 2010. The Company intends to have invested substantially all of the proceeds of the Issue within six months of the date of First Admission.

The Company will continue to comply with the following investment restrictions for so long as they remain requirements of the Listing Rules (relevant elements of which the Company has voluntarily undertaken to comply):

neither the Company, nor any of its subsidiaries will conduct any trading activity which is significant in the context of the Group as a whole;
no more than 10 per cent., in aggregate, of the value of the total assets of the Company will be invested in other listed closed-ended investment funds; and
the Company must, at all times, invest and manage its assets in a way which is consistent with its object of spreading investment risk and in accordance with the published investment policy.

It is Rising Sun's intention to manage the investment portfolio of the Company so as to have overlapping investments with Dalton only in circumstances where such overlapping investments are made and managed in accordance with the policies and procedures described in the section of paragraph 6 of Part 7 of this Prospectus headed "Conflicts policy and procedures regarding overlapping investments between the Company and Dalton Investors". The focus of Rising Sun will be to invest in enterprises in which neither Dalton nor its clients have any interest.

Treasury policy

Until the Company is fully invested, and pending re-investment or distribution of cash receipts, the Company will invest in cash, cash equivalents, near cash instruments and money market instruments. The Company expects to maintain any non-operational cash balances in Japanese Yen.

The Company may also use derivatives for gearing and efficient portfolio management purposes.

Gearing Policy

The Company uses, and may continue to use, borrowing and other gearing to seek to enhance investment returns at a level (not exceeding 20 per cent. of the Company's net assets calculated at the time of drawdown) which the Directors, the AIFM and Rising Sun consider to be appropriate. It is expected that gearing will primarily comprise bank borrowings, public bond issuance or private placement borrowings, although overdraft or revolving credit facilities may be used to increase acquisition and cash flow flexibility. The Company has in place a £20 million overdraft facility, which is undrawn. The Company expects all debt to be denominated in Japanese Yen.

Hedging Policy

Although the Company does not currently intend to enter into any arrangements to hedge its underlying currency exposure to investments denominated in Japanese Yen, it may in future, in its discretion, enter into currency hedging arrangements using futures, forwards, swaps or other derivative instruments.

3.3 Material breach of investment restrictions

In the event of any breach of the investment restrictions applicable to the Company, Shareholders will be informed of the actions to be taken by Rising Sun through a Regulatory Information Service.

3.4 Amendment to investment policy

No material change will be made to the investment policy without the approval of Shareholders by ordinary resolution.

Investment strategy

The Company seeks to achieve its investment objective by taking advantage of the corporate governance reforms in Japan and utilising the increased focus on good corporate governance to engage with management teams, unlock value and encourage investee companies to make returns to their shareholders.

Further details on the Company's investment strategy are set out in paragraph 2 of Part 8 (Investment Approach, Strategy and Process) of this Prospectus.

Alternative Investment Fund Manager

The Company has appointed International Fund Management Limited as the Company's AIFM pursuant to the AIFM Agreement under which it is responsible for overall portfolio management and compliance with the Company's investment policy, providing alternative investment fund manager services, providing guidance to the Company on its compliance with the requirements of the UK AIFM Directive and the EU AIFM Directive that apply in respect of the marketing of the shares of the Company in the UK and the EEA respectively, and undertaking risk management.

Further information on the AIFM is included in paragraph 2 of Part 7 (Directors, Management and Administration) of this Prospectus.

The Investment Adviser

Portfolio advice and day-to-day portfolio management services, including the origination and evaluation of investment opportunities and the execution of transactions, are provided to the Company by Rising Sun Management Ltd. as a delegate of the AIFM. The Investment Adviser is a company incorporated in Cayman whose registered office is c/o Appleby Global Services (Cayman) Limited, 71 Fort Street, PO Box 500, George Town, Grand Cayman KY1-1106, Cayman Islands with registered number 356413.

Further information on Rising Sun is included in paragraph 3 of Part 7 (Directors, Management and Administration) of this Prospectus.

Distribution policy

The Company believes that the substantial undervaluation of Japanese equities, coupled with an activist strategy designed to unlock underlying value should allow the Company to achieve significant investment results over time. Given the nature of this strategy, however, it is possible that such returns could be "lumpy" and unpredictable. Accordingly, the Company targets results primarily through capital appreciation, no specific dividend policy has been or is expected to be established and any distributions will be made entirely at the discretion of the Board. Notwithstanding the foregoing, the Company will make such distributions as may be required to ensure compliance with the rules relating to investment trusts.

The Company declared its inaugural interim dividend, in respect of the period from 22 October 2019 to 31 December 2020, of 0.85 pence per Ordinary Share, paid on 30 April 2021 to shareholders on the register at 9 April 2021.

Capital structure

8.1 Share capital

The Company's share capital structure immediately following the Issue will consist of Ordinary Shares and, should the Company decide to issue C Shares pursuant to the Issue, C Shares. The Ordinary Shares and C Shares are in registered form and may be held in certificated or in uncertificated form.

The Company may issue New Ordinary Shares and/or C Shares pursuant to the Placing Programme.

8.2 Further issues of Shares

Under the Act, further issues of Shares, of whatever class, for cash will be subject to pre-emption rights conferred on existing Shareholders, save to the extent these rights have been disapplied by a special resolution of the Company. The Company is seeking authority at the General Meeting to issue up to 300 million Ordinary Shares and/or C Shares pursuant to the Issue and the Placing Programme on a non-pre-emptive basis. This authority, if granted, will extend until the day prior to the first anniversary of the publication of this Prospectus, or until any such earlier date as the Placing Programme is closed.

Further details of the Placing Programme and the Directors' intentions concerning the issue of New Ordinary Shares and/or C Shares under the Placing Programme are set out in Part 12 (Placing Programme) of this Prospectus.

In addition to the allotment authority sought at the General Meeting relating to the Issue and the Placing Programme, at the Company's annual general meeting held on 12 May 2021, the Directors were given a general authority to issue Ordinary Shares having, in aggregate, a nominal value of up to £103,000.00, being 10 per cent. of the aggregate value of the Company's issued share capital as at 14 April 2021 (being the date of the notice of such annual general meeting) on a non pre-emptive basis (the "General Allotment Resolutions"). The authority granted by the General Allotment Resolutions will expire on the conclusion of the Company's annual general meeting to be held in 2022 or, if earlier, on the expiry of 15 months from the passing of the General Allotment Resolutions.

The proceeds of the issue of further Shares will be used in accordance with the Company's investment objective and policy, as described in paragraph 3 of this Part 6.

The Directors only intend to use their authority to issue New Ordinary Shares under the Placing Programme (or under their general authority) in the event that the Ordinary Shares trade at a premium to Net Asset Value and, consequently, the authority may be used in order to reduce any premium over NAV at which the Company may be trading, as well as to raise additional capital for investment in accordance with the Company's investment policy and improve liquidity. As a consequence, further issues of Ordinary Shares will be made under the Placing Programme (or under the Directors' general authority), entirely at the Directors' discretion, in respect of an aggregate number of New Ordinary Shares equal to up to 300 million, less any Shares issued under the Issue or Ordinary Shares or C Shares issued under the Placing Programme, and only at prices (net of issue costs) that represent a premium to the prevailing Net Asset Value per Ordinary Share and, therefore, will not have a dilutive effect on the NAV of the Ordinary Shares then in issue.

The Directors currently intend to seek annual renewal of the authority to issue Ordinary Shares and/or C Shares on a non-pre-emptive basis from Shareholders in respect of an aggregate number of Ordinary Shares and/or C Shares equal to up to ten per cent. of Shares in issue from time to time or such other number as the Shareholders at a general meeting of the Company shall approve.

New Ordinary Shares and C Shares issued under the Placing Programme may be issued under this Prospectus, provided that it is updated by a supplementary prospectus (if required) under Article 23 of the UK Prospectus Regulation. Article 1(5) of the UK Prospectus Regulation currently allows for the issue of shares representing, over a period of 12 months less than 20 per cent. of the number of shares of the same class already admitted to trading on the same regulated market without the requirement for a prospectus to be published, provided that such issue is not made by way of an offer of the Company's securities to the public.

Should the Board wish to issue New Ordinary Shares or C Shares in excess of the amount which it is authorised to allot, further authorities will be sought at an appropriate time by convening a general meeting of Shareholders for the purpose. It is expected that this Prospectus will remain valid for 12 months from the date hereof, subject to the requirement under the UK Prospectus Regulation to publish supplementary prospectuses to disclose any significant changes in the financial or trading position of the Company.

9. Reasons for the Issue and Placing Programme and use of proceeds

The Company was launched in February 2020. When originally conceived, it was hoped that the capital raised at IPO might reach £300 million. This would have facilitated building positions of 9 per cent. or more in specific portfolio companies – a strategy designed to attract increased attention in the shareholdings from the management of such portfolio companies. In the event, just over £103 million was raised and subsequently invested.

Despite the lower than hoped-for IPO proceeds, the performance of the Company since IPO has demonstrated a proof of the original concept. The Issue and the Placing Programme are designed to grow the size of individual holdings and should further enhance the effectiveness of the Company's investment strategy. Should performance continue to warrant it, it would be the intention of the Directors and the Investment Adviser to continue to issue further shares following the expiry of the Placing Programme. Currently, no constraints on the ability of putting much larger amounts of capital to work are envisaged.

The proceeds of the Initial Issue and the Placing Programme will be used for investment in accordance with the Company's investment policy and to fund the Company's operational expenses. The intention is to invest the proceeds of the Issue substantially within the universe of investment targets identified by the Investment Adviser. This will facilitate larger holdings and accelerate the process of engaging with management. It is probable that some further names, within the universe of suitable companies already identified, will be added over time.

10. Discount management – share buybacks

The Company may purchase Shares in the market at prices which represent a discount to the prevailing NAV per Share of that class so as to enhance the NAV per Share for the remaining holders of Shares of the same class. The Company is currently authorised to make market purchases of up to 14.99 per cent. of the aggregate number of issued Ordinary Shares as at the date of this Prospectus. Subject to the passing of the Share Buyback Resolution, the Company will be authorised to make market purchases of up to 14.99 per cent. of the aggregate number of issued C Shares immediately following First Admission.

The Board intends to seek Shareholder approval to renew its authority to make market purchases of its own issued Shares once its existing authority has expired or at subsequent AGMs.

Purchases of Shares will be made within guidelines established from time to time by the Board and only in accordance with the Statutes and the Disclosure Guidance and Transparency Rules. Any purchase of Shares may be satisfied by the available cash or cash equivalent resources of the Company, from borrowings, the realisation of the Company's assets or any combination of these sources of liquidity, at the Directors' discretion.

Ordinary Shares bought back by the Company may be held in treasury or cancelled. Such Ordinary Shares may (subject to there being in force a resolution of Shareholders to disapply the rights of pre-emption that would otherwise apply) be resold by the Company. C Shares bought back by the Company shall be cancelled.

At the date of this Prospectus, the Company does not hold any Shares in treasury.

11. Duration

The Company has been established with unlimited life. However, the Directors intend to offer shareholders an exit opportunity at close to NAV around the fifth anniversary of the IPO Admission Date (the "Exit Opportunity"). The mechanism will be dependent on various factors including the number of Shareholders seeking to participate in the Exit Opportunity, the liquidity of the underlying market at the time of the Exit Opportunity and/or the demand for Shares from other investors at the time. The Directors will consider the most efficient and cost effective mechanism for providing the Exit Opportunity which may include, but are not limited to, significant share buybacks or a tender offer. The Board and Shore Capital will canvas opinion from the Shareholders in the months leading up to the Exit Opportunity.

In addition, Shareholders will have the opportunity to vote on an ordinary resolution on the continuation of the Company at the AGM of the Company to be held in 2025, and every second AGM thereafter. If any such ordinary resolution is not passed, the Directors shall draw up proposals for the voluntary liquidation, unitisation, reorganisation or reconstruction of the Company for consideration by the Shareholders at a general meeting to be convened by the Directors for a date not more than six months after the date of the meeting at which such ordinary resolution was not passed.

12. Investment trust status

The Company has obtained approval as an investment trust from HMRC for the purposes of section 1158 of the Corporation Tax Act 2010. However, no guarantee is given that the Company will be able to maintain its status as an investment trust.

Nevertheless, the Company intends at all times to continue to conduct its affairs so as to enable it to qualify as an investment trust for the purposes of section 1158 of the Corporation Tax Act 2010 and the Investment Trust (Approved Company) (Tax) Regulations 2011. In summary, the key conditions that must be met for approval by HMRC for any given accounting period as an investment trust are that:

all or substantially all of the business of the Company is investing its funds in shares, land or other assets with the aim of spreading investment risk and giving members the benefit of the results of the management of its funds;

the Company is not a close company at any time during the accounting period for which approval is sought;
the Company's ordinary share capital is admitted to trading on a regulated market (as defined in FSMA) throughout the accounting period;
the Company is not a real estate investment trust or a venture capital trust; and
the Company must not retain in respect of the accounting period an amount greater than the higher of: (i) 15 per cent. of its income for the period; and (ii) the amount of any income which the Company is required to retain in respect of the period by virtue of a restriction imposed by law. However, where the Company has relevant accumulated losses brought forward from previous accounting periods of an amount equal to or greater than the higher of the amounts mentioned in (i) and (ii) above, it may retain an amount equal to the amount of such losses.

13. UK AIFM Directive

The Company operates as an externally managed UK domiciled AIF with a Non-UK AIFM for the purposes of the UK AIFM Directive. Accordingly, the AIFM has notified the FCA in accordance with Article 42 of the UK AIFM Directive, of the intention to market the Company in the UK. The AIFM is licensed and regulated by the Guernsey Financial Services Commission.

14. Non-mainstream pooled investment products

The Company is not deemed to be a non-mainstream pooled investment because, as an investment trust, the Shares are "excluded securities" under the FCA's rules on non-mainstream pooled investment products.

The Directors have been advised that the requirements of Article 57 of the MiFID II delegated regulation of 25 April 2016 (as it applies in the UK pursuant to the EUWA) will be met in relation to the Shares and that accordingly, the Shares should be considered "non-complex" for the purposes of MiFID II.

15. Profile of typical investors

The typical investors for whom the Shares are intended are institutional investors, professional investors, professionally advised and knowledgeable investors and non-advised private investors who fall within the criterion above who are capable themselves of evaluating the merits and risks of an investment in the Company and who have sufficient resources both to invest in potentially illiquid securities and to be able to bear any losses (which may equal the whole amount invested) that may result from the investment. Such investors may wish to consult an independent financial adviser prior to investing in the Shares. The Specialist Fund Segment is intended for investment products targeted at institutional, professional, professionally advised and knowledgeable investors and, accordingly, applications under the Offer for Subscription received direct from retail investors may be rejected by the Company.

16. Net Asset Value

The Net Asset Value is the value of all assets of the Company less liabilities to creditors (including provisions for such liabilities) determined in accordance with IFRS and the Company's valuation principles and procedures.

The Administrator is responsible for calculating the NAV per Ordinary Share and NAV per C Share of the Company. Announcements of unaudited NAV per Ordinary Share and NAV per C Share, will be made on a daily basis through a Regulatory Information Service. The unaudited NAV per Ordinary Share and NAV per C Share will be calculated in sterling on a cum income basis in line with IFRS by the Administrator with input from the Investment Adviser.

Quoted investments will be valued by reference to their bid prices on the relevant exchange. Unquoted or illiquid valuations will be valued by an appropriate third-party valuer or by the Investment Adviser, provided that the Investment Adviser will not value any such unquoted or illiquid investments at more than cost or at a value greater than that attributed to the investment by an appropriate third party valuer.

Valuations of NAV per Ordinary Share and NAV per C Share will be suspended only in any circumstances in which the underlying data necessary to value the investments of the Company cannot readily or without undue expenditure be obtained or for regulatory reasons. Any such suspension will be announced through a Regulatory Information Service.

Meetings, Accounts and Reports

All general meetings of the Company will be held in the United Kingdom. The Company will hold an annual general meeting each year. The Company's first annual general meeting was held on 12 May 2021.

The first accounting period of the Company ended on 31 December 2020 and, thereafter, accounting periods will end on 31 December in each year. The audited annual accounts are published via an RIS within four months of the year end to which they relate. Unaudited half yearly reports, made up to 30 June are announced within three months of that date. The audited annual accounts and half yearly reports will also be made available at the registered office of the Administrator and the Company and on the Company's website at www.nipponactivevaluefund.com.

The financial statements of the Company are prepared in accordance with IFRS, and the annual accounts are audited by an independent accounting firm using auditing standards in accordance with International Standards on Auditing (UK). The Directors may, however, change the accounting policies under which the Company's accounts are prepared if it is considered necessary or appropriate to do so.

Taxation

Potential investors are referred to Part 13 (UK and Japanese Taxation) of this Prospectus for details of the taxation of the Company and Shareholders in the UK. Investors who are in any doubt as to their tax position or who are subject to tax in jurisdictions other than the UK are strongly advised to consult their own professional advisers immediately.

Environmental, social and governance responsibility

Rising Sun is a signatory to the United Nations' Principles for Responsible Investment ("UNPRI"). The UNPRI is the world's leading proponent of responsible investment. It works to understand the investment implications of environmental, social and governance ("ESG") factors and to support its international network of investor signatories in incorporating these factors into their investment and ownership decisions. The UNPRI acts in the long-term interests of its signatories, of the financial markets and economies in which they operate and ultimately of the environment and society as a whole. The principles have in the region of 4,000 signatories across the globe, including major international investment management firms. Rising Sun has adopted a sustainability policy incorporating principles based on the UNPRI and which covers the integration of ESG risk analysis into its investment process and its policy on the stewardship of its client assets.

PART 7

DIRECTORS, MANAGEMENT AND ADMINISTRATION

Directors

The Directors are responsible for managing the business affairs of the Company in accordance with the Articles and the investment policy and have overall responsibility for the Company's activities including its investment activities and reviewing the performance of the Company's portfolio.

The Directors may delegate certain functions to other parties such as the AIFM, The Investment Adviser, the Administrator, the Company Secretary, the Custodian, the Prime Broker and the Registrar. In particular, the Directors have delegated responsibility for day-to-day management of the investments comprised in the Company's portfolio to the AIFM (which has in turn delegated portfolio management activities to the Investment Adviser). The Directors have responsibility for exercising supervision of the AIFM and the Investment Adviser.

All of the Directors are considered by the Board to be independent of the AIFM and Rising Sun. The Board currently consists of:

Rosemary Morgan (non-executive chair)

Rosemary is a Senior Independent non-executive Director of Schroder Asia Pacific Investment Trust, where she is the Chairman of the Audit and Risk Committee, and an independent director and Chairman of JP Morgan India Investment Trust.

Rosemary studied Japanese at the Australian National University in Canberra before being awarded the Monbusho Scholarship at Kobe University in Japan and then studying for a Master of Arts in Japanese Literature at Harvard University in the United States.

After university, Rosemary worked as a Japanese equity fund manager for 16 years at John Govett before joining the institutional client team at Fidelity International and then moving to the Royal Bank of Scotland as Head of Asia and Emerging Markets (Multi Manager Funds), where she managed long only and alternative funds of funds, specialising in Japan and Emerging Markets.

Chetan Ghosh (non-executive director)

Chetan is the Chief Investment Officer for Centrica's pension scheme arrangements and is responsible for providing support to the directors of the investment committee. His role covers investment strategy considerations, asset class and manager research, and liaising with the investment advisers.

Prior to joining Centrica in 2009 Chetan worked in a number of roles, ranging from pensions actuary at Towers Perrin to investment consultant at Aon Hewitt and Lane Clark & Peacock. Whilst at financial services firm Alexander Forbes, Chetan developed a fiduciary management offering to improve client governance structures.

Chetan has a first class degree in Mathematics from Kings College London.

Rachel Hill (non-executive director)

Since 2006, Rachel has been a director of Dragon Capital Markets (Europe) Limited and has been responsible for the European marketing of London Stock Exchange listed Vietnam Enterprise Investments Ltd and the Vietnam Equity (UCITS) fund. Rachel was also previously on the board of Dalton Asia Fund, which is a long/short Asian Investment fund managed by Dalton Investments LLC. Rachel has 28 years of experience in respect of equity and equity fund sales in Asian markets.

In addition, Rachel also currently serves on the board of DC Developing Market Strategies Ltd, a Dublin regulated UCITS fund investing in Vietnam; Quaero Capital Luxembourg Fund, a Luxembourg regulated UCITS platform with various sub funds investing in equities and bonds; and Talos Capital Luxembourg Funds, a Luxembourg SICAV Fund also managed by Quaero Capital.

Rachel holds a BA (Hons) MA in Natural Science from Trinity Hall, Cambridge University and is also a Chartered Member of the Chartered Institute for Securities and Investment.

Ayako Hirota Weissman (non-executive director)

Ayako is a senior portfolio manager and director of Asia Strategy at Horizon Kinetics LLC. With over 30 years of investment experience, Ayako was previously a founder and Chief Investment Officer of AS Hirota Capital Management, LLC.

Ayako's prior experience also includes acting as a portfolio manager specialising in Japanese securities for Kingdon Capital Management, LLC, a New York-based hedge fund, two years as a partner and Portfolio Manager of Feirstein Hirota Japan Partners and 12 years at Salomon Smith Barney Asset Management, as a Managing Director and Senior Portfolio manager in the U.S. value equity group, with responsibility for approximately US$2 billion in assets. Ayako is a member of the U.S.-Japan Council and serves on its investment committee. She also serves on Japan ICU Foundation's investment committee. Ayako is a director of Toshiba Corporation.

Ayako received an MBA from the International Institute for Management Development (IMD) in Lausanne, Switzerland and a BA in Liberal Arts from International Christian University in Tokyo, Japan. Ayako is a CFA® charterholder.

Alicia Ogawa (non-executive director)

Alicia is a director of the Project on Japanese Corporate Governance and Stewardship at the Center on Japanese Economy and Business (CJEB), Columbia Business School, NYC and has over 20 years of experience in the Asian financial markets. She also serves on the board of The Maureen and Mike Mansfield Foundation, Misaki Capital (from December 2019) and is on the investment committee of the Association of Asian Studies. She also is a member of the Assistant Adjunct Faculty, Columbia University School of International and Public Affairs as well as being a consultant for activist funds.

In her role as director of the Project on Japanese Corporate Governance and Stewardship, Alicia has been a featured speaker on Japanese financial markets issues for public and private sector conferences such as Goldman Sachs, SIFMA, Council of Institutional Investors, Japan Securities Dealers Association, CSIS, Peterson Institute, and Japan Society.

Prior to 2006, Alicia was a Managing Director and the Director of Global Research Product, Lehman Brothers, NYC and was tasked with leading the global analysts in development of a globally-themed equity research product focused on specific market sectors.

Alicia holds a M.I.A from the Columbia University School of International and Public Affairs in East Asian Studies and International Finance.

AIFM

The Company has appointed International Fund Management Limited as the Company's alternative investment fund manager ("AIFM") pursuant to the AIFM Agreement under which it is responsible for overall portfolio management and compliance with the Company's investment policy, providing alternative investment fund manager services, providing guidance to the Company on its compliance with the requirements of the UK AIFM Directive and the EU AIFM Directive that apply in respect of the marketing of the shares of the Company in the UK and the EEA respectively, and undertaking risk management subject always to the overall policies, supervision and review of the Board.

The AIFM is a limited liability company incorporated in Guernsey on 3rd September 1987, with company number 17484. The AIFM is licensed by the GFSC under the provisions of The Protection of Investors (Bailiwick of Guernsey) Law, 1987, as amended, to conduct certain restricted activities in relation to collective investment schemes and general securities and derivatives.

A summary of the AIFM Agreement is set out in paragraph 6.3 of Part 14 (General Information) of this Prospectus.

3. The Investment Adviser

3.1 Introduction

Pursuant to the Investment Advisory Agreement, the AIFM and the Company have appointed Rising Sun as Investment Adviser to provide investment advisory services to the AIFM and the Company in respect of the assets of the Company, including in connection with the evaluation, origination, acquisition and execution of potential investment opportunities for the Company, as well as on-going monitoring of the Company's investment portfolio. In providing its services, Rising Sun has regard to the investment objective, investment policy, investment restrictions and principles of allocation as set out in this Prospectus (such policies and principles as may be amended from time to time).

3.2 Rising Sun's capabilities

Rising Sun is a Cayman entity which is led by James B. Rosenwald, III. Mr Rosenwald has over 40 years' experience investing in Asia and is co-founder and chief investment officer of Dalton. Dalton is a value focused investment management firm with expertise in Asia equities and global equities. Headquartered in Santa Monica, California, with affiliate offices in Las Vegas, Tokyo, Sydney, Mumbai and Hong Kong, Dalton manages (as at 30 September 2021) US$3.4 billion in actively managed long only and long-short strategies for pensions, endowments, foundations, financial institutions and family offices. Dalton has a strong track record investing in Japanese equities. The Dalton Japan Long Only composite track record (US$1.8bn gross assets under management as at 30 June 2021 is set out below.

The Dalton Japan Long Only composite track record as at 30 June 2021 (data presented in accordance with the Global Investment Performance Standards)

	YTD 2021	2020	2019	2018	2017	2016	2015	2014	2013	2012	2011	2010	2009	2008	2007	2006	2005	2004	2003	2002	2001	2000	1999	1998	1997	1996	Gross Inception
AJI	5.8%	8.0%	19.0%	-16.0%	24.6%	3.8%	24.1%	16.0%	73.5%	25.1%	-3.3%	16.7%	7.9%	-36.9%	-15.0%	6.6%	48.8%	15.7%	25.9%	-27.3%	-12.1%	-13.8%	93.9%	-0.2%	-1.2%	-2.0%	8.2%
MSCI Japan	6.3%	8.9%	18.4%	-15.1%	19.7%	-0.7%	9.9%	9.3%	54.5%	21.7%	-18.8%	0.6%	9.0%	-42.5%	-10.1%	7.2%	44.4%	10.5%	23.0%	-19.0%	-19.0%	-19.5%	43.4%	-8.6%	-14.0%	-11.5%	1.9%

Sources: Dalton Investments LLC and Morningstar.5

PAST PERFORMANCE IS NOT A GUARANTEE OF FUTURE PERFORMANCE. THE VALUE OF THE INVESTMENTS AND THE INCOME FROM THEM CAN GO DOWN AS WELL AS UP AND AN INVESTOR MAY NOT GET BACK THE AMOUNT INVESTED. THESE INVESTMENTS ARE DESIGNED FOR INVESTORS WHO UNDERSTAND AND ARE WILLING TO ACCEPT THESE RISKS. PERFORMANCE MAY BE VOLATILE, AND AN INVESTOR COULD LOSE ALL OR A SUBSTANTIAL PORTION OF ITS INVESTMENT.

3.3 Rising Sun Management Team

Mr James B. Rosenwald, III is assisted by Mr Gifford Combs, Mr Paul ffolkes Davis and Mr Kazutaka Mizuochi. In addition the Investment Adviser has entered into an agreement whereby the Tokyo office of Dalton Advisory KK will provide investment research services to the Investment Adviser. The Investment Adviser is also registered with the U.S. Securities and Exchange Commission, as a relying adviser for Rosenwald Capital.

The management team of the Investment Adviser includes:

James B. Rosenwald, III

James heads the investment team at Rising Sun as well as being the co-founder and Chief Investment Officer of Dalton which was established in 1999. James has been a director of Shore Capital since January 2010.

He is also Portfolio Manager for Dalton Investments' Asian Equities strategies. James has over 40 years of investment experience managing equity portfolios and in particular in investing in Asia.

Prior to joining Dalton, James founded and co-managed Rosenwald, Roditi & Company, Ltd., now known as Rovida Asset Management, Ltd., which was established in 1992. He was also previously an External Manager for the Soros Group.

James holds an MBA from New York University and an AB from Vassar College.

Gifford Combs

Gifford is the co-founder and Portfolio Manager for Dalton and was a founding member of Dalton which was established in 1999. Gifford has over 30 years of investment experience managing equity portfolios.

Prior to joining Dalton, he managed equity portfolios for U.S. and international institutions at Pacific Financial Research, a Beverly Hills-based money manager with assets in excess of US$5 billion.

Gifford serves on the Capital Campaign Committee for the University of Cambridge (Cambridge, UK) as well as on the investment committees of the College of the Atlantic (Bar Harbor, USA) and the Mt Desert Land and Garden Preserve (Seal Harbor, USA). He is member of the Board of Directors of The Pot and Kettle (Bar Harbor, USA) and the Mt Desert Chamber Music Festival (Northeast Harbor, USA).

Gifford holds an M.Phil degree, with distinction, in Economics and Politics from Cambridge University and an AB degree, magna cum laude, from Harvard College.

Paul ffolkes Davis

Paul is the Chairman of Rising Sun Management Ltd. and has over forty years' experience in financial services.

He is also Chairman of Qualis Group, the development, investment, maintenance and community interest companies set up in 2019 by Epping Forest District Council to expand, develop and operate its estate management and related businesses.

From 2004 until March 2020, he was Bursar of Trinity Hall, one of Cambridge University's oldest colleges (founded 1350). During his time in charge of the College's endowment, its value rose from circa £60 million to over £320 million. Investments consisted mainly of global listed securities, together with physical property and various 'alternatives'.

While in this role, Paul founded Cambridge & Counties Bank in June 2012, with the College owning 50 per cent., and acted as its first Chairman until December 2016. Thereafter, he continued as Vice-Chairman until retiring from the Board in June 2021.

His career began in investment banking and included roles in fixed income sales and trading, portfolio management, and, latterly, running Equity Capital Markets at several institutions. Board level appointments included NM Rothschild & Sons Limited (1984-95), NatWest Markets and Rabobank International.

Paul holds MA (Hons) degrees from both Oxford and Cambridge Universities.

Kazutaka Mizuochi

Since 2018, Kazutaka has been a partner at the Tokyo law firm, Hibiya-Nakata and has over 20 years of experience in advising on matters of corporate law with a particular focus on mergers and acquisitions.

Prior to joining Hibiya-Nakata, he was a partner at the law firm Baker & McKenzie, Tokyo between 2006 and 2018.

Kazutaka’s mergers and acquisitions experience includes representing various international companies (including Japanese and British companies) in the acquisition or disposal of overseas interests.

Kazutaka was the chairperson of the Public Relations Committee of the Tokyo Bar Association between 2013 and 2015. He holds an LLB from the Keio University (Tokyo) as well as an LLM from the University of Illinois.

Julie Arnall

Julie started her career in the United Kingdom where she trained as an accountant with Whitbread Group plc, having studied Accounting and Business at the University of Luton.

In 1987, Julie moved to the Cayman Islands to join Cayman National Trust Co. Ltd (CNT), a large financial services group. As Senior Vice President of the company, Julie specialised in mutual funds and hedge funds, as well as company and trust, administration and accounting.

Julie currently runs her own financial and management accounting company as well as holding directorships in many large funds and investment companies.

Kanika Green

Kanika is the Founder and Managing Director of Corporate Management Solutions (Cayman) Ltd., a fiduciary boutique, which provides services to hedge funds and private equity funds, including the establishment, launch and maintenance of different types of investment funds, such as registered mutual funds, hedge funds and private equity funds. Kanika also advises on general corporate/commercial matters and ongoing regulatory compliance along with other complex structures. Additionally, Kanika has participated in private equity fund formation and negotiations, both on behalf of fund sponsors and investors.

Kanika is a non-executive independent director and licensed under the Directors’ Registration and Licensing Law 2014 with the Cayman Islands Monetary Authority.

Kanika has a law degree (LLB Hons.) from Wolverhampton University in London and was called to the bar in 2014. Kanika’s professional memberships include the Cayman Islands Directors’ Association, Member of the International Bar Association, Member of the 100 Women in Hedge Funds, Member of the Caymanian Bar Association, and she is also a Notary Public for the Cayman Islands. Kanika is currently a resident in the Cayman Islands and has been since 2002.

A summary of the Investment Advisory Agreement is set out in paragraph 6.2 of Part 12 (General Information) of this Prospectus.

3.4 Dalton Advisory KK

Dalton Advisory KK, a private limited company incorporated in Japan, has entered into a research services agreement with the Investment Adviser pursuant to which Dalton Advisory KK provides the Investment Adviser with research and data analysis in respect of Japanese equities.

Dalton Advisory KK is a wholly owned subsidiary of Dalton Investments LLC. Gifford Combs and James B. Rosenwald, III, chief investment officer at Rising Sun, are co-founders and senior officers of Dalton Investments LLC.

Service Providers

Set out below are the identities of the Company’s material service providers and a summary of the services provided to the Company under the terms of the respective agreements that the Company has entered into with such service providers.

4.1 Administrator and company secretary

PraxisIFM Fund Services (UK) Limited is a private limited company incorporated on 19 November 2015 in England and Wales with registered number 09879916. It is an established administrator and forms part of the PraxisIFM Group Limited, one of the largest independently-owned financial services groups based in the Channel Islands, which listed on The International Stock Exchange on 12 April 2017.

The Administrator, under the terms of the Administration Agreement, provides among other things the following services: general company secretarial functions to the Company, including those secretarial functions required by the Companies Act 2006, and day-to-day administrative services; assistance with the implementation of corporate governance and other compliance requirements; daily calculation of Net Asset Value of the Shares; maintenance of adequate accounting records and management information; preparation of the audited annual financial statements and the unaudited interim report and publication of the same through a Regulatory Information Service; and assisting with the preparation and submission of necessary tax returns.

4.2 Shore Capital

Shore Capital has been appointed as financial adviser, sole bookrunner and corporate broker to the Company. The Company, Rising Sun and Shore Capital have entered into the Placing Agreement, pursuant to which Shore Capital has agreed, subject to certain conditions, to use its reasonable endeavours to procure subscribers of the Shares to be made available in the Initial Placing and each Subsequent Placing. No placing will be underwritten.

A summary of the Placing Agreement is set out in paragraph 6.5 of Part 14 (General Information) of this Prospectus.

4.3 Registrar and Receiving Agent

Computershare Investor Services PLC has been appointed as the Registrar to the Company under the Registrar's Agreement. In such capacity, the Registrar maintains the register of Shareholders, processes all share transfers in both paper form and electronic form received via CREST and calculates and effects payment of dividends to Shareholders.

Computershare Investor Services PLC has also been appointed Receiving Agent of the Company for the Issue under the terms of the Receiving Agent's Agreement.

A summary of each of the Registrar's Agreement and the Receiving Agent's Agreement is set out in paragraphs 6.6 and 6.7 of Part 14 (General Information) of this Prospectus.

4.4 Custodian

The Northern Trust Company has been appointed as custodian of certain of the Company's assets. The Custodian is a company with limited liability established under the laws of Illinois in the United States of America has a branch registered in England and Wales with registration number BR001960. The Custodian is regulated by the FCA and authorised to undertake certain regulated activities. The Custodian's legal entity identifier is 6PTKHDJ8HDUF78PFWH30.

The Custodian is authorised to act as custodian to the Company in relation to the Company's cash and securities and perform services which are ancillary to its role as custodian to the Company. The Custodian ensures that securities of the Company are segregated from the assets of the Custodian and any sub-custodian appointed and shall not be used to discharge directly or indirectly liabilities or claims against any other undertaking or entity and shall not be available for any such purpose. The Custodian also ensures that the securities are recorded clearly to show that they are held on behalf of the Company and do not belong to the Custodian or any delegate. The Custodian shall keep or cause to be kept at its premises such books, records and statements as may be reasonably necessary to give a complete record of all the cash, securities and documents held and transactions carried out by it on behalf of the Company.

A summary of the Custodian Agreement is set out in paragraph 6.8 of Part 14 (General Information) of this Prospectus.

4.5 Prime Broker

J.P. Morgan Securities PLC (for itself and as agent and trustee for certain other members of the JP Morgan group of companies) has been appointed to provide international prime brokerage services to the Company.

These services may include the provision to the Company of clearing, settlement and share borrowing facilities. The Company may also utilise the Prime Broker, certain other members of the J.P. Morgan group of companies and other brokers and dealers for the purposes of executing transactions for the Company.

The Prime Broker also provides a custody service for the safe keeping of assets provided under or pursuant to the terms of the Prime Brokerage Agreement and/or may arrange for such assets to be held by an affiliate or third party as custodian or sub-custodian.

A summary of the Prime Brokerage Agreement is set out in paragraph 6.9 of Part 14 (General Information) of this Prospectus.

5. Fees and Expenses

5.1 Initial Fees and Expenses

The costs and expenses of the Offer for Subscription, the Initial Placing and the Intermediaries Offer (which include commission and expenses payable under the Placing Agreement, registration and admission fees, printing and distribution costs and professional advisory fees, including legal fees, and any other applicable expenses) payable by the Company are not expected to exceed £2.7 million. No expenses or taxes will be charged directly by the Company to investors.

The Issue Price for Ordinary Shares issued pursuant to the Issue will be at a premium to the prevailing NAV at the time of determination of the Issue Price which, over the course of the Issue and the Placing Programme, is intended to cover the fixed costs of the Issue. The final Issue Price is to be determined by the Board at its discretion and will be announced via an RIS prior to Admission. It is expected that the costs of the Issue will be recovered through the Issue Price, although the recovery of all or any part of the costs cannot be guaranteed.

On the basis of the gross proceeds from the Issue being £150 million, the estimated costs and expenses of the Issue which are borne by the Company are £2.7 million and the net proceeds from the Issue would be £147.3 million.

5.2 Placing Programme Fees and Expenses

The Directors anticipate that the costs incurred in respect of a Subsequent Placing of Ordinary Shares under the Placing Programme will be substantially recouped through the premium to Net Asset Value at which Ordinary Shares are issued. The total costs of any Subsequent Placing of C Shares will be borne out of the Gross Issue Proceeds of such Subsequent Placing. It is not possible to ascertain the exact costs and expenses of such Subsequent Placings. The Subsequent Expenses may or may not be capped but are estimated at approximately 1.8% per cent. of Gross Issue Proceeds for each Subsequent Placing. No Ordinary Shares issued pursuant to a Subsequent Placing will be issued at a Placing Programme Price (net of the Subsequent Expenses pertaining to that Subsequent Placing) that is less than the latest published Net Asset Value per Ordinary Share. The expenses referred to above will be borne by the Company and not separately charged to the investor. No expenses or taxes will be charged directly by the Company to investors.

5.3 Annual running expenses

The Company incurs the following annual running expenses:

(a) AIFM – For the provision of AIFM services under the AIFM Agreement, the AIFM is entitled to an annual fee calculated at a rate of 0.04 per cent. per annum of Net Asset Value up to £250 million, plus 0.025 per cent. per annum of Net Asset Value in excess of £250 million. The AIFM fee is subject to a minimum fee of £70,000 per annum. In addition, there will be a reporting cost of £3,000 per annum, per EEA jurisdiction in which the Company is marketed (other than the UK). The Company will also reimburse the AIFM for reasonable expenses properly incurred, in the performance of its obligations.

(b) Investment Adviser – For the provision of investment advisory services under the Investment Advisory Agreement, Rising Sun is entitled to receive an annual fee to be calculated as 0.85 per cent. of the Company's net assets (exclusive of VAT). The Company will also reimburse Rising Sun for reasonable expenses properly incurred by Rising Sun in the performance of its

obligations under the Investment Advisory Agreement, however Rising Sun will pay any amounts due to Dalton Advisory KK for the provision of research and data analysis services to Rising Sun.

(c) Administrator – For the provision of company secretarial and administration services under the Administration Agreement, the Administrator is entitled to receive a company secretarial fee of £55,000 per annum and an administration fee calculated at a rate of 0.06 per cent. per annum of net asset value up to, and including, £100 million plus 0.035 per cent. per annum of net asset value in excess of £100 million. The administration fee is subject to a minimum fee of £5,000 per month. The Company will also reimburse the Administrator for disbursements and reasonable out of pocket expenses properly incurred by the Administrator on behalf of the Company. The company secretarial fee and the administration fee are stated exclusive of VAT.

(d) Registrar and Receiving Agent – The fees payable to the Registrar are based on the number of transactions in the Shares plus properly incurred expenses, subject to a minimum basic annual registration fee of £4,800. The fees payable to the Receiving Agent are £14,250 plus £15 per application form received for the Offer for Subscription. The Company will also reimburse the Registrar for disbursements and reasonable out of pocket expenses properly incurred by the Registrar on behalf of the Company.

(e) Custodian – For the provision of global custody services to the Company, the Custodian is entitled to receive a global custody fee of £75,000 per annum (exclusive of VAT), plus additional set up and operational charges if the Company opts to use segregated accounts rather than the Custodian's omnibus accounts. In addition, the Company must reimburse the Custodian for any expenses incurred by the Custodian which were not reasonably foreseeable and/or quantifiable at the time the Custodian Agreement was entered into.

(f) Directors – Under the terms of their appointment, each of the Directors is entitled to receive a fee from the Company at such rate as may be determined in accordance with their appointment letter, subject to the restriction on the maximum aggregate fees payable to the Directors contained in the Articles. The fees payable to the Directors appointed as at the date of this document in respect of the Company's current financial year will be £35,000 per annum for Rosemary Morgan, who is chairperson of the Board and who also chairs the Company's Management Engagement Committee and Nomination Committee, £30,000 per annum for Chetan Ghosh, who chairs the Company's Audit Committee, and £27,000 for Alicia Ogawa, Ayako Weissman and Rachel Hill. Under the Articles, the maximum fees payable (in aggregate) to the Directors is £400,000 per annum. All of the Directors are also entitled to be reimbursed all reasonable expenses properly incurred by them in attending general meetings, board or committee meetings or otherwise in connection with the performance of their duties. The Company maintains annual directors' liability insurance at a cost that is not currently expected to exceed £50,000 per annum (exclusive of value added tax, where applicable).

(g) London Stock Exchange – An annual fee is payable to the London Stock Exchange based on the Company's market capitalisation. On the assumption that the total proceeds of the Issue are £150 million and the Company's market capitalisation is £135.45 million, such fee would be approximately £225,000 in the Company's next financial year.

(h) Audit fees – the fees payable to the Company's auditor to perform an annual audit of the Company's financial statements are £36,000 per annum.

(i) Miscellaneous – The Company will bear the costs of due diligence, finders' fees, brokerage commissions and professional services fees including auditor's fees, corporate broker fees, legal fees, listing fees of the FCA (if any), fees of the London Stock Exchange, fees for public relations services, D&O insurance premiums, promotional expenses, printing costs and fees for website maintenance, and other costs and expenses in relation to investments and disposals, as well as travel, taxes and litigation costs. The Company may also bear certain out of pocket costs and expenses of Rising Sun or its Associates, the Administrator, the Registrar, other services providers and the Directors.

Shareholders do not bear any fees, charges and expenses directly, other than any fees, charges and expenses incurred as a consequence of acquiring, transferring, redeeming or otherwise selling Shares.

5.4 Allocation of ongoing costs

Interest expenses are recognised within ‘finance costs’ in the Statements of Comprehensive Income using the effective interest rate method. All other expenses are recognised in the Statements of Comprehensive Income in the period in which they are incurred (on an accruals basis).

Conflicts of interest

The AIFM, Rising Sun, the Administrator, the Registrar, Shore Capital, Dalton Advisory KK, the Prime Broker and any of their members, directors, officers, employees, agents and connected persons and the Directors and any person or company with whom they are affiliated or by whom they are employed may be involved in other financial, investment or other professional activities which may cause potential conflicts of interest with the Company and its investments and which may affect the amount of time allocated by such persons to the Company’s business.

In particular, these parties may, without limitation: provide services similar to those provided to the Company to other entities; buy, sell or deal with assets on its own account (including dealings with the Company); and/or take on engagements for profit to provide services including but not limited to origination, development, financial advice, transaction execution, asset and special purpose vehicle management with respect to assets that are or may be owned directly or indirectly by the Company, but will not in any such circumstances be liable to account for any profit earned from any such services.

The AIFM, Rising Sun and its affiliates may also be involved with other financial, investment or professional activities which may on occasion give rise to conflicts of interest with the Company. In particular, under the terms of the Investment Advisory Agreement, Rising Sun (and each of its principals) is entitled to act as the alternative portfolio manager or investment advisor in relation to, or be otherwise involved in, investment funds established by parties other than the Company or the AIFM which have similar objectives to that of the Company, provided that at all times Rising Sun shall retain sufficient facilities, personnel, experience and expertise necessary to fulfil its obligations under the Investment Advisory Agreement. In addition, members of the Rising Sun Management Team may from time to time be appointed to act as directors of or advisors to any of the Company’s investee companies.

Both the AIFM and Rising Sun have a conflicts of interest policy which specifies the procedures that each follows and the measures that each has adopted in order to take all appropriate steps to identify and then prevent or manage such conflicts. However, there can be no assurance that the AIFM and/or Rising Sun will be able to resolve conflicts of interest in a manner that is favourable to the Company. However, in the event of a conflict of interest arising, the AIFM and Rising Sun (as applicable) will take reasonable steps to ensure fair treatment for the Company in accordance with, in the case of the AIFM, the UK AIFM Directive and The Licensees (Conduct of Business) Rules, 2016.

In particular, where Rising Sun has identified an actual or potential conflict of interest in relation to the services that it provides to the Company it shall take reasonable steps, acting in compliance with applicable law and regulation, to ensure fair treatment of the Company. Where Rising Sun believes the arrangements are not sufficient to ensure with reasonable confidence that the risks of damage to the Company will be prevented, it will inform the Directors of the nature or source of the conflict and the steps taken to mitigate those risks. This disclosure shall:

(a) clearly state that the organisational and administrative arrangements established by Rising Sun to prevent or manage that conflict are not sufficient to ensure, with reasonable confidence, that the risks of damage to the interests of the Company will be prevented;

(b) include specific description of the conflicts of interest that arise;

(d) include sufficient detail, taking into account the nature of the Company, to enable the Company to reach an informed decision with respect to the service in the context of which the conflict of interest arises.

Subject to this, and to applicable law and regulation, Rising Sun or an associate or their clients may act as principal in a transaction with the Company.

Rising Sun will not, and will procure that its affiliates will not, deal, as principal or agent for a third party, with the Company except where dealings are carried out on normal commercial terms negotiated at an arm's length basis and provided also that (i) Rising Sun and any of its affiliates may buy, hold and deal in any investments upon its individual account notwithstanding that similar investments may be held by the Company and without prior reference to the Company; and (ii) nothing herein contained shall prevent Rising Sun or its affiliates without prior reference to the Directors from contracting or entering into any financial or other transaction with any company or body or other person whose shares or securities are held by or for the account of the Company or from being interested in any such contract or transaction.

James B. Rosenwald, III is the chief investment officer at Rising Sun. Mr Rosenwald is also a co-founder and the managing partner of Dalton Investments LLC, which is the ultimate parent of Dalton Advisory KK, a firm engaged to provide investment research and analysis to Rising Sun. Mr Rosenwald is also a director of certain companies in Shore Capital's group and sits on its board;
Gifford Combs is a senior executive at Rising Sun. Mr Combs is also a co-founder of Dalton which is the ultimate parent of Dalton Advisory KK, a firm engaged to provide investment research and analysis to Rising Sun;
Dalton is a value focused investment management firm with expertise in Asia equities and global equities. Dalton has a strong track record investing in Japanese equities. Dalton Advisory KK undertakes investment research and data analysis services in relation to Japanese equities for both Dalton (and its affiliates) and the Company. Therefore, there is a risk that Dalton and the Company may find themselves targeting the same investment opportunity. However, the Company and Rising Sun believe that the Company's current activist investment strategy is distinct from Dalton's investment strategy and therefore the risk of targeting the same investment opportunity is low. The Company and Rising Sun intend not to target investment opportunities which they believe Dalton (or its affiliates) may already be targeting or in which Dalton (or its affiliates) may already be invested. The Company and Rising Sun will evaluate this risk on an ongoing basis as part of any review of its investment strategy. Should the Company find that it is targeting the same opportunity as Dalton (or one of its affiliates), the Company will take appropriate advice and action at the time, and will adhere to the policies and procedures described in section below titled "Conflicts policy and procedures regarding overlapping investments between the Company and Dalton Investors"; and
Shore Capital owns 16 per cent. of Rising Sun's issued share capital.

Conflicts policy and procedures regarding overlapping investments between the Company and Dalton Investors

Since the Company's IPO, Rising Sun's intention has been to manage the investment portfolio of the Company so as to have no overlapping investments with Dalton, and the focus of Rising Sun has been to invest in enterprises in which neither Dalton nor its clients have any interest.

It remains the intention of Rising Sun not to target investment opportunities which they believe Dalton and/or or its affiliates on behalf of their advisory clients (together "Dalton Investors") may already be targeting or in which Dalton Investors may already be invested.

In consideration of a number of factors and developments since the Company's IPO, including:

the constraints on the Company's ability to participate in investment opportunities on the basis of its available capital and its investment policy;
the likely restrictions which would be imposed on any proposed substantial acquisition of Shares by Dalton Investors under the Takeover Code (including, without limitation, Rule 9 of the Takeover Code), limiting Dalton's ability to invest in and through the Company,

Rising Sun intends, with effect from the date of Publication, to manage the Company's investment portfolio such that a limited number of investments, subject to management in accordance with the policies and procedures set out below including the prior approval of the Board, may be made in entities in which Dalton Investors also invest, either alongside or following the Company's initial investment ("Overlapping Investments")

In order to ensure the equitable management of the potential conflicts of interest which could arise in respect of such Overlapping Investments, the Company, Rising Sun and Dalton have agreed that the following policies and procedures will apply to any Overlapping Investment:

(a) Dealings in any Overlapping Investment by the Company (including initial investment, any disposal or follow-on investment), will be subject to the prior approval, as needed, of the Board and the Chief Compliance Officer of Dalton and Rosenwald Capital.

(b) Without prejudice to its obligations under paragraphs (c) and (d) below, since trading for the Company and the Dalton Investors is generally done by Dalton pursuant to a services agreement, Dalton will endeavour to allocate Overlapping Investments made simultaneously with the Company, pre-trade and pari passu among the accounts.

(c) If an initial investment in an Overlapping Investment opportunity is to be made by the Company and the Dalton Investor(s) in accordance with a co-investment arrangement or otherwise made at substantially the same time, such investment shall be made pro rata between the Company and the Dalton Investor(s) based upon the respective accounts' cash availability for investment as at the date of the proposed investment or as otherwise determined by Rising Sun and Dalton, subject to the approval, as needed, of the Board and the Chief Compliance Officer of Dalton and Rosenwald Capital under paragraph (a).

(d) The Company shall not be restricted from making any disposals in an Overlapping Investment, but the Company shall have the right (without obligation) to require Dalton to procure that any disposals in an Overlapping Investment shall be made pro rata based on the holdings of the Company and the relevant Dalton Investor(s) in such Overlapping Investment at the time of such disposal, save that Dalton may make such disposal, following written notice to the Company that a client is terminating its relationship with Dalton, or instructing Dalton to liquidate its position in such Overlapping Investments, or that Dalton is required to make such disposal under its fiduciary duty owed to its clients or otherwise by law, rules, regulations, or actions/orders by government entities.

(e) The Company shall have the right (without the obligation) to require Dalton to procure that any follow on investments by Dalton in an Overlapping Investment shall be made pro rata based on the holdings of the Company and the relevant Dalton Investor(s) in such Overlapping Investment at the time of such follow-on investment or as otherwise determined by Rising Sun, subject to the approval, as needed, of the Board and the Chief Compliance Officer of Dalton and Rosenwald Capital under paragraph (a).

(f) The structure of any Overlapping Investment shall not be restricted (and shall permit, for the avoidance of doubt, co-investment arrangements), provided that such structure facilitates the compliance by the Company, Rising Sun and Dalton with the principles set out above.

The Co-Invest Entities

Michael 1925 LLC and Earle 1927 LLC (the "Co-Invest Entities") are vehicles which, from time to time, enter into co-investments with the Company. The Co-Invest Entities are not Dalton Investors, but are managed by Rosenwald Capital and advised by Rising Sun. The policies which govern the making of co-investments between the Company and each of the Co-Invest Entities are documented by memoranda of understanding. The Company and the Co-Invest Entities are only permitted to invest together in the same company on the advice of Rising Sun, and in such amounts as Rising Sun deems suitable. At all times, the Company is only permitted to invest alongside the Co-Invest Entities in accordance with the Company's investment policy.

Rising Sun is required to continue to review co-investments entered into, and future co-investment opportunities with, the Co-Invest Entities, and, where necessary, take all appropriate steps to identify and prevent circumstances that would give rise to a conflict of interest.

Corporate governance

7.1 Compliance

The Board is committed to high standards of corporate governance and has made arrangements to enable the Company to comply with the recommendations of the Corporate Governance Code published by the Financial Reporting Council. The Company has obtained membership of the AIC and as such, complies with the UK Corporate Governance Code as recommended by the AIC Code or as otherwise may be disclosed from time to time.

As an investment company, most of the Company's day-to-day responsibilities are delegated to third parties and the Directors are all non-executive. Thus not all the provisions of the Corporate Governance Code are directly applicable to the Company. The Board intends to take appropriate action to ensure that the appropriate level of corporate governance is attained and the Company's practices are consistent with the Principles of the Corporate Governance Code.

The Company does not intend to comply with the Corporate Governance Code provisions relating to:

(a) the role of the chief executive;
(b) executive directors' remuneration;
(c) the need for an internal audit function; and
(d) the whistle blowing policy.

For the reasons set out in the AIC Code, the Board considers these provisions are not relevant to the position of the Company, being an externally managed investment company. The Company will therefore not report in respect of these provisions.

7.2 Board independence, composition and tenure

The Board currently consists of five non-executive Directors. It is chaired by Rosemary Morgan who is responsible for its leadership and for ensuring its effectiveness in all aspects of its role. The Board meets at least four times a year and receives full information about the Company's investment performance, assets, liabilities and other relevant information in advance of Board meetings from the Administrator and Rising Sun. The Directors' biographical details, set out in paragraph 1 of this Part 7, demonstrate a breadth of investment, commercial and professional experience, including in activist investment experience and experience in the Japanese equities market. The Directors review their independence annually.

Each Director is subject to the election/re-election provisions set out in the Articles which provide that Directors shall stand for election by shareholders at the first AGM after their appointment. Thereafter the Directors are required to retire at every annual general meeting of the Company and may, if willing to continue to act, be elected or re-elected at that meeting or may offer himself or herself for re-appointment by the members. If at the date of an annual general meeting, the chairman has held office for nine years or more then he or she shall not be eligible for re-election.

The Chair regularly reviews the training and development needs of each Director. Directors' appointments will be reviewed formally by the Board prior to their nomination for re-election. Any Director may resign in writing to the Board at any time.

The Board also receives regular briefings from, amongst others, the Company's auditor regarding any proposed developments or changes in laws or regulations that could affect the Company and/or the Directors.

7.3 Audit Committee

The Audit Committee meets at least twice per year. It comprises the entire Board including the Chair and is chaired by Chetan Ghosh. The Audit Committee is responsible for the review of the annual report and the half year report, the nature and scope of the external audit and the findings therefrom, and the terms of appointment of the auditors, including their remuneration, independence and the provision of any non-audit services by them.

The Audit Committee reviews the need for non-audit services and authorise such on a case by case basis.

The Audit Committee will as required meet representatives of the Administrator, the AIFM, Rising Sun and their compliance officers who will report as to the proper conduct of business in accordance with the regulatory environment in which the Company operates. The Company's auditor will also be required to attend the Audit Committee at its request and report on its work procedures, the quality and effectiveness of the Company's accounting records and its findings in relation to the Company's statutory audit. The Company meets with the auditor, without representatives of the Administrator or Rising Sun being present, at least once a year.

7.4 Management Engagement Committee

The Management Engagement Committee meets at least once per year. It comprises each member of the Board and is chaired by Rosemary Morgan. The Management Engagement Committee is responsible for the regular review of the terms of the AIFM Agreement, the Investment Advisory Agreement, the Administration Agreement and other service providers' agreements and the performance of the AIFM, Rising Sun, the Administrator and also the Company's other service providers.

7.5 Nomination Committee

The Nomination Committee meets at least once per year. It comprises each member of the Board and is chaired by Rachel Hill. The Nomination Committee is responsible for appointments and re-appointments to the Board and to ensure that a formal, rigorous and transparent procedure for such appointment and reappointment is followed.

The Nomination Committee is also responsible for determining the framework for the remuneration of the Board and each Director's remuneration (although no individual director shall be involved in any decisions as to their own remuneration). In determining the Company's remuneration policy, the Nomination Committee shall take into account all relevant factors including, without limitation, legal and regulatory requirements, the provisions and recommendations of the UK Corporate Governance Code, the AIC Code and associated guidance.

7.6 Matters reserved to the board

The Board also has overall responsibility for the Company's activities, including reviewing its investment activity, performance, business conduct and policy and, unless required to be performed by the AIFM as a matter of law, certain matters have been reserved for consideration by the Board, including (but not limited to):

approving the Company's long term objective and any decisions of a strategic nature including any change in investment objective, policy and restrictions, including those which may need to be submitted to Shareholders for approval;
reviewing the performance of the Company in light of the Company's strategy objectives and budgets, ensuring that any necessary corrective action is taken;
the appointment, overall supervision and removal of key service providers and any material amendments to the agreements or contractual arrangements with any key delegates or service providers;
approving any interim dividends, any recommendation to shareholders in respect of final dividends and the Company's dividend policy;
the review of the Company's corporate governance processes and arrangements; and
approving any actual or potential conflicts of interest.

8. Takeover Code

The Takeover Code applies to the Company. Further details are provided at paragraph 4 of Part 14 (General Information).

Pre-emption rights

Shareholders have pre-emption rights under the UK Companies Act in respect of the allotment of equity securities which are, or are to be, paid up in cash. However, Shareholders may, by special resolution, dis-apply such pre-emptive rights.

UK Market Abuse Regulation and the Disclosure Guidance and Transparency Rules

As a company whose shares are admitted to trading on the Specialist Fund Segment of the Main Market (a regulated market), the Company complies with all of the provisions of the UK Market Abuse Regulation and the Disclosure Guidance and Transparency Rules which are applicable to it. The Directors have adopted a share dealing code that is compliant with the UK Market Abuse Regulation. The Board is responsible for taking all proper and reasonable steps to ensure compliance with the share dealing code by the Directors and other persons discharging managerial responsibilities ("PDMRs").

The Disclosure Guidance and Transparency Rules provide that certain persons (including Shareholders) must notify the Company if the proportion of the Company's voting rights which they then hold directly or indirectly as a shareholder or through a direct or indirect holding of certain financial instruments reaches, exceeds or falls below thresholds of three per cent., four per cent., five per cent., six per cent., seven per cent., eight per cent., nine per cent. and 10 per cent. and each one per cent thereafter up to 100 per cent.

PART 8

INVESTMENT APPROACH, STRATEGY AND PROCESS

Investment approach

Over the past several decades, many Japanese companies have built very strong balance sheets, reducing their reliance on debt financing and building up reserves of cash and investments. The result is that numerous Japanese companies are sitting on excess capital, and consequently often exhibiting very low equity returns. The Japanese government has attempted to address this issue by implementing regulations encouraging companies to set out goals for returns on equity, for reducing passive shareholdings in unrelated entities and for increasing dividend payouts to shareholders. Further, it has relaxed regulations that have inhibited mergers and takeovers of companies.

Rising Sun believes that there is a perception among many international investors that, although Japanese equities are relatively inexpensive, such companies represent "value traps" that are likely to remain inexpensive for a long period of time. The net result, in the view of Rising Sun, is that the time continues to be opportune for an activist strategy that engages with management teams of Japanese companies to restructure balance sheets and improve returns for shareholders.

Rising Sun believes that companies that have excess capital over and above that required for the operation of the business can increase their return on equity immediately by distributing such excess capital to shareholders, either by repurchasing their shares in the market, or paying out larger cash dividends. The Company seeks to invest in a small number of companies that have significant scope for such actions. Rising Sun will engage with company management to encourage restructuring. This will include elimination of passive shareholdings, distributing excess cash and committing to more substantial dividend payout ratios.

The Company focuses on companies that have "open" share registers – that is, companies that have no large controlling shareholders, and will seek to obtain large minority positions in investee companies (of typically 4.9 to 25.0 per cent.) (although to date such shareholdings have been typically 1.0 to 6.0 per cent., up to an approximate aggregate of 10 per cent. in some instances together with the Co-Invest Entities) to obtain influence with management through direct engagement and by obtaining, when appropriate, one or more board seats. The goal will be to help companies focus on generating higher returns for shareholders.

Rising Sun believes that there is a substantial number of value-focussed investors that are either currently investing or are prepared to invest in Japan, but that such investors would like to see: (i) a change in attitude toward corporate governance in the country; and (ii) a greater number of activist investors willing to catalyse such a change. To date, however, there has only been a small number of international activist investors willing to establish investment positions in Japanese companies and press for change. Such activity, while more unusual than in Western markets, has been noted by the international press. The Company believes that a number of institutional investors will be supportive of activist efforts in a "behind the scenes" role if the Company is willing to take the public lead in approaching companies.

Consequently, the Company intends to be engaged and public in its efforts to enhance governance and improve capital allocation decisions among the companies in which it invests. The Company intends to establish meaningful minority positions; but it will be willing to make tender offers for large blocks of stock with the intent of establishing working control of a company if required. To this end, the Company may use cash or its own stock or a combination of the two for such tenders.

The Company expects that it will work closely with one or more private equity firms that have established operations in Japan and have, in some cases, raised dedicated funds for the purpose of making acquisitions in the Japanese market.

Dalton participated in one of the earliest management buyouts in the Japanese market in 2007. The Company expects that one or more investments made by the Company will become targets of acquisition bids, either friendly or hostile, and the Company will seek to use its large minority stock positions to enhance returns by encouraging such bids.

Rising Sun considers recent regulatory and governance changes in Japan, mean that it is the right time to pursue their investment strategy.

Further information on the key areas of the investment opportunity identified by Rising Sun are set out below:

Attractive valuations compared to other markets

Rising Sun believes that Japanese equities are inexpensive compared with other developed markets around the world using standard measures of valuation. Rising Sun believes that, in aggregate, Japanese listed companies trade at price-to-earnings ratios that are approximately three-fifths of those for companies in the United States. In particular, smaller companies are even cheaper when compared with the overall market. For example, Rising Sun has analysed companies with market capitalisations of between US$150m and US$350m and, as at 25 October 2021, 79 trade for less than the value of their net working capital after deducting all liabilities, and 105 companies trade at a ratio of enterprise value or 'EV' (the sum of market capitalisation and gross indebtedness net of cash and investments) to 'EBITDA' (pre-tax earnings before deductions for interest, taxes, depreciation and amortization) of less than two times (Source: Bloomberg).

PE ratios of developed Equity markets as at July 2021

Source: Bloomberg, July 2021

Rising Sun believes that pricing inefficiencies are prevalent in the Japanese listed equity market and in particular in companies with smaller market capitalisations. It is believed that such inefficiencies arise from both an excess number of listed companies combined with a lack of "sell-side" research coverage: the majority of Japanese companies being covered by two or fewer analysts.

Rising Sun believes that such low valuations may have arisen also due to a combination of low shareholder returns, poor corporate profitability as measured by returns on equity and a perception on part of shareholders that management teams have had little incentive to improve returns. As discussed further below, the Investment Adviser believes that corporate governance reform will encourage management teams to improve returns and engage further with shareholders. Japanese stocks trade at low valuations, both in absolute terms and relative to securities on other exchanges around the world. Not only are valuations low in terms of current and prospective earnings; but they are also low when market capitalisations are adjusted for excess capital not required to run operations.

	P/E	P/BV	EV/EBITDA
Japan Nikkei 225	16.0	1.9	8.4
MSCI World	24.2	3.2	15.0

Source: Bloomberg statistics for Nikkei 225 and MSCI World indexes as at July 2021.

2. A large number of cash rich companies

As at September 2019, companies listed in Japan held ¥506.4 trillion (US$4.8 trillion) in cash, the highest level on record and more than triple the amount in March 2013 (Bloomberg, September 2019) (see graph below). In addition, the combined cash and securities holdings of non-financial companies listed in Japan has also continued to increase over the last 10 years.

Source: Ryo Yanagi - Professor, Waseda University, 2020

Moreover, a significant number of Japanese companies have cash in excess of their market cap. The Investment Adviser believes that there are a number of reasons for the increasing cash levels in Japanese companies, including: management conservatism, focus on stakeholders rather than shareholders and strong cash flow generation. The Investment Adviser believes that the significant cash reserves provide opportunities for activist strategies as further described below.

3,684 Listed Companies (excluding Financial Companies)	March 2021
Cash Holdings	133.6 trillion yen
Cash + Securities	218.9 trillion yen
Cash ≥ Market Capitalization	288 companies (7.8%)
Cash + Securities ≥ Market Capitalization	571 companies (15.5%)
Cash + Securities – Liabilities with Interest ≥ Market Capitalization	218 companies (5.9%)

Source: Ryo Yanagi - Professor, Waseda University, March 2021

3. Market restructuring

In December 2020, the Tokyo Stock Exchange announced its plan to simplify its current four market divisions by restructuring its market into three market segments, the "Prime Market", "Standard Market" and "Growth Market", from April 2022. The Prime Market will have the strictest listing criteria of the three segments, including a minimum tradeable market capitalisation of at least JPY10 billion and a tradeable share ratio of 35 per cent. (so as to maintain "public market control").

In addition, in revising the Corporate Governance Code (as detailed in the section below titled "Corporate governance reform"), the Tokyo Stock Exchange has recently implemented rules requiring a higher level of governance for Prime Market listed companies than for those listed in the Standard Market and Growth Market.

The Tokyo Stock Exchange announced that 30 per cent. of stocks currently listed in its "1st Section" do not meet the criteria for the Prime Market, which would (in the absence of averting action being taken by affected companies) result in the number of companies in the Tokyo Stock Exchange's premier segment decreasing from approximately 2,200 to approximately 1,500. The Tokyo Stock Exchange is planning to announce the results of the new market segment selections in January 2022. The Investment Adviser believes that several small-cap companies with limited liquidity which are most at risk of demotion from the Tokyo Stock Exchange's premier segment will seek to address any shortcomings to avoid such an event, thereby providing additional investment opportunities for the Company. By way of example, to increase share prices such companies may seek to increase dividend payments in an effort to share prices and, therefore market capitalisation.

4. Changing capital allocation practices

Capital allocation practices have been changing rapidly in Japan. According to the Japan Exchange Group ("JPX"), gross dividends paid on the JPX have grown from 5.3 trillion Yen in 2009, to 14.7 trillion Yen in 2019. Over the same period, the volume of share buybacks has increased, albeit not in a linear fashion, from 1.4 trillion Yen to 7.3 trillion Yen. Aggregate shareholder yield from dividends and share buybacks as a proportion of market capitalisation of companies on the JPX have shown a trend of growth rising from 2.3 per cent. to 3.7 per cent. from 2009 to 2019.

5. Greater exit opportunities provided by private equity funds

In the eight years from 2010 to 2018, there was only moderate growth in the assets under management held by Japan-focused private equity funds, from US$14.5 billion to US$22 billion, but 2019-2020 saw a significant expansion of that, and, as at 31 December 2020, Prequin reported there was deployable capital of US$15 billion and total assets under management in the sector of US$35 billion. The value of unsolicited takeover bids in the middle part of the last decade was negligible, but 2019 saw US$1.96 billion of takeover activity, which grew to US$3.2 billion in 2020, and US$3.9 billion in the current year to date, representing more than 100 per cent. growth from 2019 to present, year on year.

6. Corporate governance reform

The Investment Adviser believes that, historically, many Japanese companies have been run inefficiently and capital allocation has been poor. Reasons for this, stemming from Japanese history and culture, include a focus on stakeholders rather than shareholders, conservatism and protectionism (including poison-pill strategies), investment holdings including cross shareholdings, over comfortable management and a weak regulatory framework. Although improving, Japanese companies continue to have inefficient capital structures and cross shareholdings persist. Changes in the shareholder profiles of Japanese listed companies are highlighted by the following graphic:

For the purposes of this graph, cross-shareholdings means: the value of public equities held by other public companies, and broadly defined cross-shareholdings means: the value of public equities held by other public companies and insurance companies.

In addition, various corporate governance reforms have been implemented in recent years which means Japanese companies are under pressure to reform and focus on shareholder returns rather than other interests. These include:

(a) 2014: Stewardship Code established

The code provides for voluntary code of conduct for institutional investors and fund managers to adopt with the aim of ‘promoting the sustainable growth of companies through investment and dialogue.

(b) 2015: The Corporate Governance Code established

The code encourages management to deliver shareholder returns, improve the efficiency of balance sheets, improve board composition, reduce cross-shareholdings and incentivise management more effectively. Listed companies are required to comply or explain with the code.

These reforms were triggered by the view that, in Japan, executives received much lower compensation and lower long-term equity incentives than their counterparts in western countries. To address this, tax reforms were introduced whereby stock could be issued to executives as a type of incentive.

(d) 2017: Tax reform on spin-off transactions, renewal of the Stewardship Code and the ‘Progress of Corporate Governance’ report by the Japanese Financial Services Agency (FSA)

As per the new tax rules, provided certain requirements are met, two types of transaction (the business-spin off and the subsidiary spin-off) can receive more favourable tax treatment.

The revised 2017 Stewardship Code builds upon the 2014 Code, and also encourages dialogue between a company and investors (collective arrangement) when appropriate.

After reviewing the progress made under the Stewardship Code and the Corporate Governance Code since their adoption, the FSA also released a report on corporate governance in Japan setting out its proposals to revise the Corporate Governance Code and implement reform. In particular, they flagged the lack of decisive action by management and the high level of cross-shareholdings. Companies are encouraged to review their current practices and structures in order to deliver better results for shareholders.

(e) 2018: Revision of Corporate Governance Code – “Comply or Explain”

On 1 June 2018, the Tokyo Stock Exchange announced revisions to Japan’s Corporate Governance Code. Changes included a requirement to assess and disclose the purpose of each individual cross-shareholding in light of the associated risks and cost of capital and their policy on reduction of cross-shareholdings, both among the more frequent subject matters targeted by activist shareholders in Japan. The revisions also required listed companies to either comply with its principles or explain why they did not, known as the “comply-or-explain” rule.

(f) 2019: M&A guidelines reform

Given the advances in corporate governance in Japan, guidelines regarding corporate value and protecting shareholders’ interests were released in 2019. The aim of these guidelines is to propose effective measures by which an M&A transaction could be run and therefore protect the shareholders.

In light of these reforms and the pressure that these companies are under to increase shareholder returns, the Company believes that Japanese companies are starting to positively respond to activist investor engagements.

(g) 2021: Revision of the Corporate Governance Code – Enhanced board independence and investor engagement

On 11 June 2021, the Tokyo Stock Exchange announced revisions to Japan’s Corporate Governance Code enhancing board independence, drawing attention to sustainability and ESG, and promoting diversity. In particular, changes included a requirement that companies should engage in constructive dialogue with investors even outside the general shareholder meeting, which the Investment Adviser believes could result in upturns in value for Japanese companies as they begin to listen to shareholders more closely.

Other changes include (i) an increase in the minimum number of independent directors on the board of directors of companies which apply the Corporate Governance Code from two to at least one-third; (ii) the requirement to establish nomination and remuneration committees where independent directors do not compose a majority of the board of directors and, for Prime Market listed companies, that the majority of the members of each such committee should be independent directors; (iii) for companies with a controlling shareholder, the requirement to appoint at least one-third of the directors as independent directors who are independent of the controlling shareholder or establish a special committee composed of independent persons to review conflicts of interest between the controlling shareholder and minority shareholders; (iv) the requirement to make electronic voting platforms and English translations of notices of general meetings available in certain circumstances. The Investment Adviser believes that all of the foregoing changes will improve board engagement with, experience for and increase the likelihood of such companies delivering greater value to shareholders.

Opposition to shareholder meetings

The Company believes that as a result of the new guidelines and reforms, Japan is currently seeing an increase in shareholders opposing resolutions at general meetings of companies as well as an increased number of proposals being put forward for consideration at annual general meetings. These movements not only demonstrate the change in approach to governance in Japan, but also demonstrate, in the Company’s opinion, the framework for activist activities in Japan including by overseas investors.

Summary of the investment opportunity

In summary, the Investment Adviser believes there is an attractive opportunity to invest in undervalued, high quality and growing businesses which have significant asset backing in the form of cash and/or investment holdings. Alongside this, the Investment Adviser believes there is an opportunity, given recent corporate governance reform in Japan, to drive shareholder returns through activist strategies which have the objective of promoting capital efficiency and increased corporate governance in investee companies.

James B. Rosenwald, III who is the chief investment officer at the Investment Adviser, has achieved successful returns from investments in Japan using activist strategies as the founder of Dalton Investments. Most notably this included Dalton Investment’s investment in Sun Telephone.

Investment strategy

The Company intends, as its principal activity, to continue to invest in a highly concentrated portfolio of up to 20 holdings of listed or quoted Japanese equity investments in companies with market capitalisations of or up to US$1 billion which the Investment Adviser deems most attractive and undervalued and in relation to which it believes its activist strategies will deliver increased shareholder returns. Additionally, while the Company intends that the majority of its investments will be in quoted companies, it may also make investments in unquoted companies and the Company may become invested in unquoted companies as a result of corporate actions or commercial transactions undertaken by quoted companies. The Company will only make an investment in an unquoted company if the aggregate interest of the Company in unquoted companies at the time of such investment is not more than 10 per cent. of the Net Asset Value of the Company at that time.

The intention is to take large minority positions in investee companies which are of a significant size to enable the Company to effectively implement activist strategies. There will be no restriction placed on the market capitalisation of investee companies. In order to be able to take large minority positions, the Company expects to target small-cap companies with market capitalisations of up to US$1 billion. The Company intends to invest in businesses which are run by professional directors (or "salarymen") and not owner-operator businesses. The Company, following advice from the Investment Adviser, is of the opinion that companies run by professional directors tend to have a broader ownership base and are likely to be less hostile to activist strategies. Japanese listed companies are markedly increasing the number of independent directors that sit on their boards of directors:

Companies with above 2 Independent Directors (TSE 1stsection)

Source: Japan Exchange Group (JPX), Tokyo Stock Exchange

Companies with above 1/3 of Independent Directors (TSE 1stsection)

The Investment Adviser takes a holistic approach to assessing investee companies, looking both at different valuation fundamentals as well as assessing characteristics such as board structure, management motivations and shareholdings, share register analysis, optimum capital structure, standards of corporate governance, alliances and acquisitions that can be made and potential for improvement and scope for increased distributions. The Investment Adviser draws on both its in-house experience in investing in Japanese companies as well as relying on the on-the-ground research capability of Dalton Advisory KK.

The Investment Adviser believes that the corporate governance reforms have created the right circumstances and environment for activist investors to successfully engage with publicly traded companies in Japan to improve shareholder returns. The Company intends to continue to pursue multiple activist strategies, including:

communication and dialogue with management teams and boards (including management meetings and letters and presentations to the board);
putting representatives of the Company on the board of investee companies;
making shareholder proposals. Shareholders who hold three per cent. or more of a company's voting rights for at least six months can demand that directors call extraordinary general meetings regarding any matter that the shareholder calling the meeting is entitled to vote on under Japanese law;
collective engagement with other shareholders;
partnerships within the industry as well as turnaround specialists; and
tender offer bids, typically as part of a consortium of other investors.

The aim of these strategies is to encourage reform and restructuring of capital structure, board structure, strategy, alignment of interests and improved investor relations which the Investment Adviser believes will drive share prices of investee companies and generate returns for the Company. Dalton, which as explained elsewhere in this document, has connections with the Investment Adviser, has over recent years conducted an ongoing campaign in Japan of engagement with management teams to educate about the advantages of focused capital

allocation to improve returns. This has included meetings, letter writing and introduction of various professionals to management teams. It has also been involved in executing several activist campaigns in Japan.

3. Investment process

3.1 Introduction

The Company seeks to capitalise on Japanese corporate governance reform and intends to take an activist approach to its investments, encouraging management and boards to unlock value by improving corporate governance and/or reducing excess capital through distributions to shareholders and/or through accretive mergers and acquisitions and/or productive capital expenditure where appropriate. The Investment Adviser's engagement with the management and directors of the investee companies will typically begin in private but may become public if required. While there are no lower or upper restrictions on the market caps of investee companies, there will be a bias towards small-cap companies where the Investment Adviser believes the most significant undervaluations exist and where there is greater scope for activist engagement.

This section describes Rising Sun's investment process from sourcing and origination, to due diligence and project evaluation, transaction execution, and approach to long term portfolio management.

3.2 Rising Sun's Management Team

Rising Sun has combined capabilities in origination, evaluation and transaction execution with expertise across equities, shareholder activism and active portfolio management. Rising Sun maintains a management team that meets regularly (the "Management Team") that is responsible for reviewing and evaluating potential investment opportunities. The Management Team's role is to make recommendations to the AIFM and the Company in relation to proposed and existing investment activities of the Company together with reviewing any due diligence reports along with any transaction memorandum on a potential investment. Following review by the Management Team, the AIFM and the Board will be provided with information relating to the investment and have the opportunity to review and request further information on the potential investment opportunity.

3.3 Investment screening

Rising Sun screens investment opportunities to identify potential investments that meet the Company's investment objective and complies with its investment policy. Through this screening process, Rising Sun will determine whether to proceed with detailed due diligence and evaluation of the investee company.

In addition to financial analysis, Rising Sun analyses a variety of other aspects of the investee company including the standards of corporate governance and the potential for improvement, what the optimal capital structure should be, as well as the scope for increased shareholder distributions by the investee company. This process will include an analysis of the shareholder register, stakes held by management and affiliates, and will seek to understand the motivations of the management and directors. The Investment Adviser makes full use of its network of local advisers based at Dalton Advisory KK when carrying out this analysis and due diligence.

3.4 Due Diligence and Project Evaluation

After a potential investment opportunity has been identified and screened against the target investment criteria and if it determines to proceed then Rising Sun will perform a detailed due diligence review of the investee company. Rising Sun employs a robust due diligence process applying principles of quantitative analysis to stress test assumptions, price capital structures, and determine risk-adjusted returns.

Once Rising Sun has completed its initial due diligence review of a proposed investment opportunity, it will prepare a detailed transaction memorandum. The transaction memorandum will summarise the key project terms, descriptions, economics, projected returns, structure, capitalisation, and also the findings of the key third party due diligence reports. The transaction memorandum will be circulated to the Management Committee for its evaluation and approval. Following review by the Management Committee, the AIFM and the Board will be provided with information relating to the investment opportunity and have the opportunity to make enquiries and other observations and comments regarding the potential investment opportunity. Once such consultation process has completed, Rising Sun will recommend the proposed investment opportunity to the AIFM and the Company. The decision whether

or not to proceed with the proposed investment opportunity will be made by the AIFM and only once such approval is obtained, will Rising Sun be able to implement the proposed investment opportunity.

3.5 Transaction Execution

Where an investment opportunity proceeds to the execution phase, Rising Sun will manage the transaction process, including co-ordinating the work of other professional advisers and service providers, including agents, valuers, lawyers, accountants, and tax advisers.

3.6 Portfolio monitoring and reporting

Rising Sun’s portfolio monitoring activities measure the performance of both the Portfolio and the investee companies in which it has invested at regular reporting intervals. It is intended that a Rising Sun representative will attend every annual general meeting of the portfolio companies and use such other opportunities that it may have to interact with the management teams of portfolio companies as it sees fit.

3.7 Investment case studies

Set out below are four case studies, two representing the successful implementation of the Company’s strategy, and two where implementation has not yet been successful:

CASE STUDY 1: Ebara Jitsugyo (6328 JP)

Ebara Jitsugyo (“Ebara”) manufactures pumps and other water handling equipment for industrial applications and municipal utilities. It is a very “green” business with growing sales in wastewater treatment and environmental remediation as well as a stable after-market niche in traditional supplies for plumbing and heating and ventilating systems. Ebara outsources much of its manufacturing to third parties and, as such, enjoys a very high return on invested capital because of its design capability.

Given its high return on capital and reasonable valuation, the Investment Adviser (on behalf of the Company) began purchasing shares in Ebara in February 2020. With no debt and a large amount of surplus cash on the balance sheet (roughly equivalent to Ebara’s market capitalisation of just under £90 million at the time), the Investment Adviser’s view was that Ebara could easily improve shareholder returns through one or more simple capital allocation decisions.

After a series of conversations with Ebara management, the Investment Adviser proposed that Ebara consider a buyout of its public shareholders. The Investment Adviser’s view was that would give public shareholders of Ebara an exit at a price much higher than any that Ebara stock had reached in recent years and would spread ownership of Ebara’s equity across its employee base. In the event, Ebara’s management decided that the Company would remain publicly traded, but agreed with us that they should do more to reward Ebara shareholders.

In Autumn 2020, Ebara announced a substantial increase (more than 60 per cent.) in its annual dividend and this had an immediate effect on Ebara’s share price. In addition, in three separate announcements in 2021, Ebara increased its dividend by a further 50 percent, and committed to maintaining a consistent dividend payout ratio in the future.

Whilst the Investment Adviser believes that there is still more that Ebara can do to reward shareholders (it still retains a very large cash balance, for instance), the Investment Adviser is gratified that Ebara’s share price has increased dramatically (by more than 130 per cent.) since the beginning of the engagement process and has now climbed to a level where the price is closer to reflecting what the Investment Adviser considers to be the intrinsic value of Ebara.

CASE STUDY 2: Sakai Ovex (3408 JP)

Sakai Ovex is a small-cap (£128 million) provincial company in the textile industry. Sakai Ovex provides finishing and dyeing services to larger textile manufacturers, engages in some textile trading and has a growing business in the manufacture of control systems for factories. More recently, it has started a joint-venture with its largest customer, Tokyo Rayon, to provide textiles to Chinese manufacturers, most notably the Chinese production facilities of Fast Retailing, which owns the Uniqlo brand.

The Investment Adviser identified Sakai Ovex as a consistently profitable company that had accumulated significant financial assets on its balance sheet, had virtually no debt and no large controlling shareholder.

The Chairman of Sakai Ovex, owning less than one per cent. of the equity, is the only employee with a significant stake in the business. This is precisely the profile of the sort of Japanese company that the Investment Adviser believes is a candidate for financial restructuring to enhance value for all shareholders. With £57 million of net surplus financial assets on its balance sheet and stable profits of £13 million as at 31 December 2019, it was clear to the Investment Adviser that Sakai Ovex had multiple options that it could employ to improve returns for shareholders.

The Investment Adviser (on behalf of the Company) began purchasing the Company's stake in Sakai Ovex on 5 March 2020 and engaged with Sakai Ovex's management through a series of virtual meetings followed up by letters with suggestions of how they might restructure the balance sheet, either through a large share repurchase programme, a one-time capital payout or a succession of enhanced dividends. The Investment Adviser also offered to help Sakai Ovex management structure a management buyout of Sakai Ovex's public shareholders to provide equity ownership for all employees. This proposal was formalised and publicly announced in both London and Tokyo in late November 2020.

The Investment Adviser's recommendations were received politely, although it did not appear that they had much impact on management's thinking at first. In December 2020 the Chairman of Sakai Ovex then contacted the Investment Adviser with a proposal that he would lead a buyout of Sakai Ovex with the help of Mizuho Securities (a large Japanese investment bank). Rising Sun's President, Mizuochi-sensei, immediately went to visit the Chairman and helped him shape his proposed buyout. In exchange for the Investment Adviser's support, the Company was offered the opportunity to participate in the new private company, Sakai Textiles, which would be the successor to Sakai Ovex. The Company, for a very small investment, was offered preferred shares, convertible under certain circumstances, into nine per cent. of the new entity.

Unfortunately, the transaction was not fully subscribed at the initial proposal of Yen 2,350 per share. The Sakai Ovex Chairman then launched his own offer for Sakai Ovex in February 2021 at Yen 2,850 per share, subsequently increased to Yen 3,000 per share. Even at this level, the Chairman's proposal narrowly failed to reach the two-thirds ownership he sought in order to proceed and his tender therefore failed. However, he and his advisers, Mizuho Securities, engaged with other shareholders, restructured the deal with their input, and re-launched the tender at Yen 3,810 per share.

The tender completed in September 2021. The Company tendered its entire holding as part of the process, generating net proceeds of £4,468,568 for the Company, representing a return of 79.84 per cent. (GBP) on its original investment in Sakai Ovex.

CASE STUDY 3: Ishihara Chemical (4462 JP)

Ishihara Chemical is a chemicals wholesaler and production company that manufactures chemicals for use in electronics, car maintenance and industry, as well as chemical monitoring equipment. The manufacturing element of the business has grown out of the company's beginnings as a wholesaler, and there is a focus on research and development in order to develop new products and further diversify the fields the company supplies.

The Investment Adviser intends to approach the management team and begin discussions on delivering greater value for shareholders at a moment it deems appropriate.

The Company has invested 526,011,345 Yen in Ishihara Chemicals and the holding was valued on 25 October 2021 at 719,100,000 Yen, representing a return of 38.76 per cent. (YEN) on the Company's investment to date.

CASE STUDY 4: Vital KSK (3151 JP)

Vital KSK is a wholesaler of pharmaceuticals and veterinary medications.

As with Ishihara Chemical, the Investment Adviser intends to approach the management team and begin discussions on delivering greater value for shareholders at a moment it deems appropriate.

The Company has invested 638,020,947 Yen in Vital KSK and the holding was valued on 25 October 2021 at 478,640,000 Yen, representing a return of -22.15 per cent. (YEN) on the Company's investment to date.

PART 9

CURRENT PORTFOLIO

Currently, the Company is invested in 20 companies, each of which is a Japanese company having its shares listed and traded on the Tokyo Stock Exchange.

The unaudited net asset value of the Company, as at the close of business on 25 October 2021, being the latest practicable date prior to publication of this Prospectus, was £137.92 million, representing a Net Asset Value per Ordinary Share of 133.9 pence. The market price of the Ordinary Shares as at 25 October 2021 was 131.5p, representing a discount to NAV of 1.8 per cent.

Performance track record

Audited performance

At 31 December 2020, the net assets of the Company stood at £117.0 million and the net asset value per Ordinary Share stood at 113.58p.

Unaudited performance

As at 30 June 2021, the net assets of the Company stood at £108.7 million and the net asset value per Ordinary Share stood at 105.5p. Both these measures have continued to advance since, reaching £137.92 million and 133.9p respectively by 25 October 2021.

Performance total return since inception

As at 25 October 2021

Share price

+36.6 per cent.

Net Asset Value

+32.87 per cent.

Net Asset Value per Ordinary Share

+29.5 per cent.

The information below regarding the financial characteristics of the Portfolio and information on the sectors in which the Company has invested are presented below to provide a comprehensive and meaningful analysis of the securities held by the Company as at 25 October 2021.

Portfolio investments

As at 25 October 2021, being the latest practicable date prior to the publication of the Prospectus, the Company's portfolio comprised 20 investments, representing 96.1 per cent of Net Asset Value, with a further 25.6 per cent. held in cash (including money market accounts). These holdings were as follows:

Company	Sector	Shareholding percentage in investee company	Investee company market cap (£'000)	Value (unaudited)
				Yen	Sterling	% of Portfolio	% of net assets	% Return
Bunka Shutter Co., Ltd.	Industrial	1.6%	£506,317	1,293,114,600	8,259,256	6.3%	6.0%	32.59
Chiyoda Integre Co., Ltd.	Industrial	3.7%	£190,622	1,088,000,000	6,949,168	5.3%	5.1%	15.86
Daiichi Kensetsu Corporation	Industrial	2.0%	£264,452	833,700,000	5,324,928	4.0%	3.9%	-0.97
DKK-TOA Corporation	Industrial	1.5%	£112,504	268,800,000	1,716,853	1.3%	1.3%	-7.75
Ebara Jitsugyo Co., Ltd.	Industrial	5.8%	£246,442	2,259,902,400	14,434,230	11.0%	10.5%	114.75
HIRANO TECSEED Co., Ltd.	Industrial	3.1%	£252,008	1,206,333,000	7,704,973	5.9%	5.6%	66.19
Ihara Science Corporation	Industrial	1.6%	£185,814	442,413,600	2,825,741	2.1%	2.1%	-0.34
Intage Holdings Inc.	Consumer, Non-cyclical	5.3%	£482,585	3,916,807,500	25,017,054	19.0%	18.3%	70.50
Ishihara Chemical Co., Ltd.	Consumer, Cyclical	3.1%	£145,932	719,100,000	4,592,966	3.5%	3.4%	27.68
Japan Securities Finance Co., Ltd.	Financial	1.0%	£527,932	794,358,600	5,073,650	3.9%	3.7%	66.40
Konishi Co., Ltd.	Basic Materials	1.0%	£465,145	725,700,000	4,635,121	3.5%	3.4%	15.87

Company	Sector	Shareholding percentage in investee company	Investee company market cap (£'000)	Value (unaudited)
				Yen Yen	Sterling Sterling	% of Portfolio	% of net assets	% Return
Mitsuboshi Belting Ltd.	Industrial	2.5%	£419,825	1,616,508,000	10,324,803	7.8%	7.5%	4.75
Nihon Denkei Co., Ltd.	Industrial	6.5%	£85,651	872,104,800	5,570,223	4.2%	4.1%	37.75
Nihon Kagaku Sangyo Co., Ltd.	Basic Materials	1.1%	£173,428	295,425,000	1,886,910	1.4%	1.4%	23.01
Nippon Fine Chemical Co., Ltd.	Basic Materials	3.2%	£358,307	1,777,600,000	11,353,715	8.6%	8.3%	51.87
Nittetsu Mining Co., Ltd.	Basic Materials	1.0%	£368,095	579,700,000	3,702,604	2.8%	2.7%	39.10
Sankyo Seiko	Consumer, Cyclical	0.7%	£219,972	226,800,000	1,448,595	1.1%	1.1%	-0.33
Soda Nikka Co., Ltd.	Consumer, Cyclical	1.3%	£101,112	202,812,500	1,295,384	1.0%	0.9%	-0.56
Teikoku Electric MFG. Co., Ltd.	Industrial	3.4%	£189,301	1,012,900,000	6,469,497	4.9%	4.7%	4.31
Vital KSK Holdings, Inc.	Consumer, Non-cyclical	1.0%	£301,108	478,640,000	3,057,123	2.3%	2.2%	-33.50
				20,610,720,000	131,642,795	100.0%	96.1%	-

Portfolio characteristics (unaudited) as at 30 September 2021

Equity investments	89 per cent.
Price/Book	121.9 per cent.
Price/Earnings	14.4x
EV/EBITDA	4.7x
Net Cash/Market Cap	26.4 per cent.
Adjusted Cash/Market Cap	40.9 per cent.
Net Working Capital/Market Cap	54.2 per cent.

Sector breakdown (unaudited) as at 30 September 2021

The Company is invested across a broad range of sectors, as illustrated in the below table, which is presented using the GICS sector categories for reference. Information is presented as at 30 September 2021.

Consulting Engineering Finance
Industrial Mining Pharmaceuticals
Cash

Top Five and Bottom Five Holdings (unaudited) as at 25 October 2021)

The top five and bottom five holdings of the Company by capitalisation owned and amount invested are set out in the following tables:

Top Five

Company	Capitalisation owned	Amount invested (GBP)	% of Net Assets	% of Portfolio	% return
Nihon Denkei Co Ltd	6.5%	4,257,108	4.0%	4.2%	37.75
Ebara Jitsugyo Co Ltd	5.8%	6,924,355	10.4%	11.0%	114.75
Intage Holdings Inc	5.3%	15,028,374	18.0%	19.0%	70.50
Chiyoda Integre Co Ltd	3.7%	6,083,374	5.0%	5.3%	15.86
Teikoku Electric Manufacturing Co Ltd	3.4%	6,466,017	4.7%	4.9%	4.31

Bottom Five

Please note, regarding each of the holdings below, the Company has not yet built a shareholding substantial enough to the point where Rising Sun considers it appropriate to approach and begin discussions with management. Therefore, the Company's investment strategy has not been fully effected yet with regards to these holdings.

Company	Capitalisation owned	Amount invested (GBP)	% of Net Assets	% of Portfolio	% return
Nittetsu Mining Co Ltd	1.0%	2,330,049	2.7%	2.8%	39.10
Vital KSK Holdings Inc	1.0%	4,790,810	2.2%	2.3%	-33.50
Konishi Co Ltd	1.0%	4,154,806	3.3%	3.5%	15.87
Japan Securities Finance Co Ltd	1.0%	3,206,131	3.7%	3.9%	66.40
Sankyo Seiko Co Ltd	0.7%	1,453,579	1.0%	1.1%	-0.33

As demonstrated in the chart below, each of the aforementioned stocks, with the exception of Mitsubishi Belting have outperformed the MSCI Japanese Smaller Companies Index during the period under review:

Total % Return (GBP) - Since Fund IPO (03/21/20)

Source: Dalton

PART 10

FINANCIAL INFORMATION

Introduction

The financial information contained in this Part 10 has been extracted without material adjustment from (i) the audited report and accounts of the Company for the financial period from the Company's incorporation on 22 October 2019 ended 31 December 2020; and (ii) the unaudited half yearly reports for the period from the Company's incorporation on 22 October 2019 ended 30 June 2020 and the six months ended 31 December 2021, each of which have been incorporated by reference into this Prospectus.

Auditor and audit report

BDO LLP of 55 Baker Street, London W1U 7EU provided an unqualified audit report in respect of the audited report and accounts of the Company for the financial period from the Company's incorporation on 22 October 2019 ended 31 December 2020. BDO LLP is a member of the Institute of Chartered Accountants of England and Wales.

Documents incorporated by reference

The audited report and accounts of the Company for (i) the financial period from the Company's incorporation on 22 October 2019 ended 31 December 2020; and (ii) the unaudited half yearly reports for the financial period from the Company's incorporation on 22 October 2019 ended 30 June 2020 and the six months ended 30 June 2021 on the pages specified in the table below are incorporated by reference into this Prospectus. The non-incorporated parts of this financial information of the Company are either not relevant to investors or covered elsewhere in this Prospectus.

Information	Audited annual report for the period ended 31 December 2020 Page number	Unaudited half yearly report for the six months ended 30 June 2021 Page number	Unaudited half yearly report for the six months ended 30 June 2020 Page number
Investment Objective, Financial Information and Performance Summary	2	2	2
Chairman’s Statement	3-4	3-4	3-4
Japanese Corporate Governance Update	5	–	–
Investment Adviser’s Report	6-8	5-8	5-6
Portfolio Sectors Breakdown	9	9	7
Interim Management Report	–	10-11	8-9
Investment Policy, Results and Other Information	10-11	–	–
Risks and Risk Management	12-14	–	–
Section 172 Statement	15-16	–	–
Directors’ Report	17-22	–	–
Corporate Governance	23-27	–	–
Directors’ Remuneration Report	28-31	–	–
Report of the Audit and Risk Committee	32-33	–	–
Statement of Directors’ Responsibilities	34	–	–
Independent Auditor’s Report	35-39	–	–
Statement of Comprehensive Income	40	12	10
Statement of Financial Position	41	13	11
Statement of Changes in Equity	42	14	12
Statement of Cash Flows	43	15	13
Notes to the Accounts	44-56	16-24	14-22
Alternative Performance Measures (“APMS”)	57	25	23
Glossary	58	26-27	24-25

The documents incorporated by reference can be obtained from the Company's website, www.nipponactivevaluefund.com, and as set out in paragraph 14 of Part 14 (General Information) of this document.

Selected key financial information

The key figures that summarise the Company's financial condition in respect of (i) the financial period from the Company's incorporation on 22 October 2019 ended 31 December 2020; and (ii) the unaudited half yearly reports for the financial period from the Company's incorporation on 22 October 2019 ended 30 June 2020 and the six months ended 30 June 2021, which have been extracted without material adjustment from the historical financial information referred to in the table above, are set out in the following table:

	Audited annual report for the period ended 31 December 2020	Unaudited half yearly report for the six months ended 30 June 2021	Unaudited half yearly report for the six months ended 30 June 2020
Net assets (£'000)	116,986	126,899	108,688
Net asset value per Ordinary Share (pence)	113.58	123.2	105.5
Profit and comprehensive income (£'000)	13,987	10,789	5,688
Earnings per Ordinary Share (pence)	18.84	10.47	5.52

Historical Financial Information

The audited report and accounts of the Company for (i) the financial period from the Company's incorporation on 22 October 2019 ended 31 December 2020; and (ii) the unaudited half yearly reports for the financial period from the Company's incorporation on 22 October 2019 ended 30 June 2020 and the six months ended 30 June 2021, which have been incorporated into this document by reference (and the parts of these documents that are not referred to in this Part 10 are not relevant to investors), included, on the pages specified in the table below, the following information:

Information	Audited annual report for the period ended 31 December 2020 Page number	Unaudited half yearly report for the six months ended 30 June 2021 Page number	Unaudited half yearly report for the six months ended 30 June 2020 Page number
Independent Auditor's Report	35-39	–	–
Statement of Comprehensive Income	40	12	10
Statement of Financial Position	41	13	11
Statement of Changes in Equity	42	14	12
Statement of Cash Flows	43	15	13
Notes to the Accounts	44-56	16-24	14-22
Alternative Performance Measures ("APMS")	57	25	23

Operating and financial review

The audited report and accounts of the Company for (i) the financial period from the Company's incorporation on 22 October 2019 ended 31 December 2020; and (ii) the unaudited half yearly reports for the financial period from the Company's incorporation on 22 October 2019 ended 30 June 2020 and the six months ended 30 June 2021, which have been incorporated into this document by reference (and the parts of these documents that are not referred to in this Part 10 are not relevant to investors), included, on the pages specified in the table below: descriptions of the Company's financial condition (in both capital and revenue terms); details of the Company's investment activity and portfolio exposure; and changes in its financial condition for such period.

Information	Audited annual report for the period ended 31 December 2020 Page number	Unaudited half yearly report for the six months ended 30 June 2021 Page number	Unaudited half yearly report for the six months ended 30 June 2020 Page number
Investment Objective, Financial Information and Performance Summary	2	2	2
Chairman's Statement	3-4	3-4	3-4
Japanese Corporate Governance Update	5	-	-
Investment Adviser's Report	6-8	5-8	5-6
Portfolio Sectors Breakdown	9	9	7
Interim Management Report	-	10-11	8-9
Investment Policy, Results and Other Information	10-11	-	-
Risks and Risk Management	12-14	-	-
Section 172 Statement	15-16	-	-
Directors' Report	17-22	-	-
Corporate Governance	23-27	-	-
Directors' Remuneration Report	28-31	-	-

7. Capital resources

The Company is funded by equity. Details of the Company's capitalisation and indebtedness are set out in paragraph 2 of Part 14 (General Information). As at the date of this Prospectus, the Company had no guaranteed and unguaranteed, secured and unsecured indebtedness.

PART 11 THE ISSUE

1. Introduction

The Issue consists of the Initial Placing, the Offer for Subscription, and the Intermediaries Offer pursuant to which the Company is targeting the issue of up to 150 million New Shares in aggregate.

The costs of the Issue payable by the Company, based on an Issue of 150 million Shares, are expected to be c.£2.7 million. The Issue Expenses are those that are necessary for the completion of the Issue (which include commission and expenses payable under the Placing Agreement entered into in connection with the Issue, registration, admission fees, printing and distribution costs and professional advisory fees, including legal fees, and any other applicable expenses associated with the Issue).

For illustrative purposes only, if 150 million C Shares are issued pursuant to the Issue at a price of 100p per C Share and the costs payable by the Company are £2.7 million, the net proceeds of the Issue would be £147.3 million.

The Issue Price for Ordinary Shares issued pursuant to the Issue will be at a premium to the prevailing NAV at the date of determination of the Issue Price which, over the course of the Issue and the Placing Programme, is intended to cover the fixed costs of the Issue. The final Issue Price is to be determined by the Board at its discretion and will be announced via an RIS prior to Admission. It is expected that the costs of the Issue will be recovered through the Issue Price, although the recovery of all or any part of the costs cannot be guaranteed.

The Issue Price for C Shares would be 100p per C Share.

The Issue constitutes an opportunity to subscribe for New Shares in the Company. The total number of New Shares to be issued under the Issue will be determined by the Company, Shore Capital and Rising Sun after taking into account demand for the New Shares and prevailing economic and market conditions, subject to a maximum of 150 million New Shares. After engaging with investor demand, the Company will make an announcement as to whether C Shares or Ordinary Shares will be issued pursuant to the Issue on or around 12 November 2021.

The Initial Placing, Offer for Subscription and Intermediaries Offer are conditional amongst other things on:

the Share Allotment Authorities being passed at the General Meeting and not having been revoked or superseded;
the Placing Agreement having become unconditional in all respects (save for the condition relating to First Admission) and not having been terminated in accordance with its terms prior to Admission; and
First Admission becoming effective not later than 8:00 a.m. on 25 November 2021 or such later time and/or date as Shore Capital and the Company may agree, (being not later than 8:00 a.m. on 31 January 2022).

If not all of these conditions are met, the Issue will not proceed and an announcement to that effect will be made through a Regulatory Information Service. Further details of the Placing Agreement are set out in paragraph 6.5 of Part 14 (General Information) of this Prospectus.

Neither the Initial Placing, the Offer for Subscription or the Intermediaries Offer are underwritten. The decision whether to proceed with the Issue will be at the absolute discretion, and subject to the agreement, of the Directors, Rising Sun and Shore Capital.

Dealings in the New Shares issued pursuant to the Issue will not be permitted prior to First Admission. In the event that C Shares are issued pursuant to the Issue, the C Shares (the "Issue C Shares"):

(a) will not be entitled to any dividends payable in respect of the Ordinary Shares but on their conversion into New Ordinary Shares they will rank pari passu with the Ordinary Shares (save for any dividends or other distributions declared, made or paid on the Ordinary Shares by reference to a record date prior to the conversion of the Issue C Shares); and

(b) will be entitled to any dividends payable in respect of the pool of assets attributable to the Issue C Shares. It is intended that dividends will be declared on the Issue C Shares only in the event that there is material

net income available for distribution to the Issue C Shares, but the level of dividends (if any) declared on the Issue C Shares will depend on the actual timing and terms of the deployment of the Issue C Share proceeds. In the event that any net income attributable to the Issue C Shares is not distributed as dividend, such net income will be included in the value of the Issue C Shares when calculating their entitlement for New Ordinary Shares upon their conversion.

Further details on the conditions to the Initial Placing, Offer for Subscription and Intermediaries Offer are set out below.

2. The Initial Placing

Shore Capital has agreed to use its reasonable endeavours to procure Places to subscribe for New Shares in the Initial Placing on the terms and subject to the conditions set out in the Placing Agreement. Details of the Placing Agreement are set out in paragraph 6.5 of Part 14 (General Information) of this Prospectus.

The terms and conditions which apply to any subscription for New Shares pursuant to the Initial Placing are set out in Part 16 (Terms and Conditions of Application under the Initial Placing and the Placing Programme) of this Prospectus.

3. The Offer for Subscription

New Shares will also be offered for subscription in the United Kingdom only through the Offer for Subscription. The Issue Price for the New Shares will be payable in full on application. In the event that the Directors decide to proceed with an issue of Ordinary Shares, the Issue Price for the new Ordinary Shares will be determined by the Company and will be not less than the prevailing Net Asset Value per Ordinary Share at the time of determination of the Issue Price plus a premium which, together with premia over the course of the Placing Programme, is intended to cover the fixed costs of the Issue. In the event that the Directors decided to proceed with an issue of C Shares, the Issue Price for the C Shares will be £1.00.

Applications under the Offer for Subscription must be for a minimum of £5,000. Multiple subscriptions under the Offer for Subscription by individual investors will not be accepted.

The New Shares will be a qualifying investment for the stocks and shares component of an ISA, provided they are acquired by an ISA plan manager through an offer to the public (such as the Offer for Subscription) or in the market, but not through the Initial Placing. Any person wishing to apply for New Shares under the Offer for Subscription through an ISA should contact their ISA manager as soon as possible.

The terms and conditions of application under the Offer for Subscription are set out in Part 17 (Terms and Conditions of Application under the Offer for Subscription) of this Prospectus. The procedure for applying for C Shares under the Offer for Subscription and an application form for use under the Offer for Subscription can be found in the Appendix to this Prospectus.

Payment must be made by cheque or banker's draft or by electronic interbank transfer (CHAPS). Payment by cheque or banker's draft must be in pounds Sterling drawn on a branch in the United Kingdom of a bank or building society which is either a member of the Cheque and Credit Clearing Company Limited or the CHAPS Clearing Company Limited or which has arranged for its cheques or bankers' drafts to be cleared through the facilities provided for members of either of those companies. Such cheques or bankers' drafts must bear the appropriate sort code in the top right hand corner. Cheques, which must be drawn on the personal account of the individual investor where they have sole or joint title to the funds (the account name should be the same as that shown on the Application Form), must be made payable to "CIS PLC RE: NAVF OFS ACCOUNT" and crossed "A/C Payee". Third party cheques may not be accepted with the exception of building society cheques or bankers' drafts where the building society or bank has confirmed the name of the account holder by stamping or endorsing the cheque/banker's draft to such effect.

Cheques or bankers' drafts will be presented for payment upon receipt. No interest will be paid on payments made before they are due. It is a term of the Offer for Subscription that cheques shall be honoured on first presentation and the Company may elect to treat as invalid acceptances in respect of which cheques are not so honoured. All documents, cheques and bankers' drafts sent through the post will be sent at the risk of the sender.

If cheques or bankers' drafts are presented for payment before the conditions of the Issue are fulfilled, the application monies will be kept in a separate interest bearing bank account with any interest being retained for the Company until all conditions are met. If the Offer for Subscription does not become unconditional, no

New Shares will be issued pursuant to the Offer for Subscription and all moneys will be returned (at the applicant's sole risk), without payment of interest, to applicants as soon as practicable following the lapse of the Offer for Subscription.

Payment by electronic interbank transfer (CHAPS) must be accompanied by a personalised payment reference number which may be obtained by contacting the Registrar directly by email at [email protected]. The Registrar will then provide you with a unique reference number which must be used when sending the payment. Please make such payment for value by no later than 1:00 p.m. on 18 November 2021. Payment by CHAPS must come from a personal account in the name of the individual investor where they have sole or joint title to the funds (the account name should be the same as that shown on the Application Form).

Completed Application Forms accompanied by a cheque or banker's draft for the full amount due or indicating that a CHAPS payment for the full amount has been made must be posted to Computershare, Corporate Actions Projects, Bristol BS99 6AH, so as to be received by no later than 1.00 p.m. on 18 November 2021 at which time and date the Offer for Subscription will close. The Directors may, with the prior approval of Rising Sun and Shore Capital, alter such date by shortening or lengthening the offer period under the Offer for Subscription. The Company will notify investors of any such change through the publication of a notice through a Regulatory Information Service.

4. The Intermediaries Offer

Investors may also subscribe for New Shares at the Issue Price pursuant to the Intermediaries Offer. Applicants under the Intermediaries Offer may subscribe for New Shares in sterling only. Only the Intermediaries' retail investor clients who are highly knowledgeable private and advised investors who understand or have been advised of the potential risk from investing in companies admitted to trading on the Specialist Fund Segment, and who are in the United Kingdom are eligible to participate in the Intermediaries Offer.

Investors may apply to any one of the Intermediaries all of whom will be appropriately licensed in the jurisdictions in which they are located to be accepted as their client. The Intermediaries who have been appointed by the Company prior to the date of this Prospectus are listed in paragraph 15 of Part 14 (General Information) of this Prospectus. Further Intermediaries may be appointed after the date of this Prospectus and information with respect to any Intermediaries who are appointed after the date of this Prospectus will be made available on the Company's website, www.nipponactivevaluefund.com. Underlying applicants are not allowed to make more than one application under the Intermediaries Offer (whether on their own behalf or through other means, including, but without limitation, through a trust or pension plan).

No New Shares allocated under the Intermediaries Offer will be registered in the name of any person whose registered address is outside the United Kingdom except in certain limited circumstances. For the avoidance of doubt, applicants in the United States or who are U.S. Persons will not be able to participate in the Intermediaries Offer.

An application for New Shares in the Intermediaries Offer means that the applicant agrees to acquire the New Shares at the Issue Price. The minimum application amount under the Intermediaries Offer is £5,000. Each underlying applicant must comply with the appropriate money laundering checks required by the relevant Intermediary and all other laws and regulations applicable to their agreement to subscribe for New Shares. Where an application is not accepted or there are insufficient New Shares available to satisfy an application in full, the relevant Intermediary will be obliged to refund the underlying applicant as required and all such refunds will be made in accordance with the terms provided by the Intermediary to the underlying applicant. None of the Company, the AIFM or Shore Capital accepts any responsibility with respect to the obligation of the Intermediaries to refund monies in such circumstances.

Each Intermediary will be informed by Shore Capital of the aggregate number of New Shares allocated to, and to be acquired by, the Intermediary on behalf of its underlying clients (or to the Intermediaries themselves) and the total amount payable in respect thereof. The actual number of New Shares to be allocated to the Intermediaries will be determined by the Company (in consultation with the Investment Adviser and Shore Capital).

Each Intermediary has agreed, or will on appointment agree, to the Intermediaries Terms and Conditions, which regulate, inter alia, the conduct of the Intermediaries Offer on market standard terms and provide for the payment of commission to any Intermediary that elects to receive a commission and/or fee (to the extent permissible by the FCA Rules) from the bookrunner. Any expenses incurred by any Intermediary are for its own account. Investors should confirm separately with any Intermediary whether there are any commissions, fees or

expenses that will be applied by such Intermediary in connection with any application made through that Intermediary pursuant to the Intermediaries Offer.

Pursuant to the Intermediaries Terms and Conditions, in making an application, each Intermediary will also be required to represent and warrant that they are not located in the United States or a U.S. Person and are not acting on behalf of anyone located in the United States or a U.S. Person. Under the Intermediaries Offer, New Shares will be offered solely to non-U.S. Persons outside the United States in reliance on Regulation S under the Securities Act.

In addition, the Intermediaries may prepare certain materials for distribution or may otherwise provide information or advice to retail investors in the United Kingdom subject to the Intermediaries Terms and Conditions. Any such materials, information or advice are solely the responsibility of the relevant Intermediary and shall not be reviewed or approved by any of the Company, the AIFM or Shore Capital. Any liability relating to such documents shall be for the Intermediaries only. Any Intermediary that uses this Prospectus must state on its website that it uses this Prospectus in accordance with the Company's consent and the conditions attached thereto. Intermediaries are required to provide the terms and conditions of the Intermediaries Offer at the time of such offer to any prospective investor who has expressed an interest in participating in the Intermediaries Offer to such Intermediary. Any application made by investors to any Intermediary is also subject to the terms and conditions imposed by such Intermediary.

The publication of this Prospectus and any actions of the Company, the AIFM, Shore Capital, the Intermediaries or other persons in connection with the Issue or the Placing Programme should not be taken as any representation or assurance as to the basis on which the number of New Shares to be offered under the Intermediaries Offer or allocations within the Intermediaries Offer will be determined and all liabilities for such action or statement are hereby disclaimed by the Company, the AIFM and Shore Capital.

5. Subscriber warranties

Each subscriber of New Shares in the Issue and each subsequent investor in the Shares will be deemed to have represented, warranted, acknowledged and agreed to the representations, warranties, acknowledgments and agreements set out in paragraphs 4 and 5 in Part 16 (Terms and conditions of Application under the Placing and the Placing Programme) to this Prospectus.

The Company, the AIFM, Shore Capital, and their respective directors, officers, members, agents, employees, advisers and others will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgments and agreements.

If any of the representations, warranties, acknowledgments or agreements made by the investor are no longer accurate or have not been complied with, the investor will immediately notify the Company.

6. Dealings and settlement

Application will be made to the London Stock Exchange for up to 150 million New Shares to be issued pursuant to the Issue to be admitted to trading on the Specialist Fund Segment of the Main Market of the London Stock Exchange. It is expected that Admission will occur and that dealing in the New Shares to be issued pursuant to the Issue will commence on 25 November 2021.

Subject to the Issue becoming unconditional, the New Shares to be issued pursuant to the Issue are expected to be issued on 25 November 2021, fully paid and in registered form, and may be delivered into CREST or in certificated form. Applicants under the Offer for Subscription wishing to have their New Shares delivered to a CREST stock account in their own name, which is expected to take place on 25 November 2021, should include their CREST details in section 4 of the Application Form. Temporary documents of title will not be issued pending the despatch of definitive certificate for New Shares issued in certificated form, which is expected to take place in the week commencing 29 November 2021. Dealings in the New Shares to be issued pursuant to the Issue will not be permitted prior to Admission. Subsequent to Admission, dealings in New Shares in advance of the crediting of the relevant CREST accounts or the issue of share certificates will be at the risk of the person concerned.

The C Shares that may be issued pursuant to the Issue are registered with ISIN number GB00BKLGLT27 and SEDOL number BKLGLT2. The Ordinary Shares that may be issued pursuant to the Issue are registered with ISIN number GB00BKLGLS10 and SEDOL number BKLGLS1.

The Company does not guarantee that at any particular time market maker(s) will be willing to make a market in the New Shares, nor does it guarantee the price at which a market will be made in the New Shares. Accordingly, the dealing price of the New Shares may not necessarily reflect changes in the Net Asset Value per C Share and Net Asset Value per Ordinary Share.

7. Announcements regarding the Initial Placing, Offer for Subscription and the Intermediaries Offer

The results of the Initial Placing, Offer for Subscription, the Intermediaries Offer and the basis of allocation are expected to be announced by the Company through a Regulatory Information Service on or around 23 November 2021 and, in any event, prior to First Admission.

8. Conditions of the Issue

The Issue is conditional on, among other things, (i) the Share Allotment Authorities being passed at the General Meeting and not having been revoked or superseded; (ii) the Placing Agreement not being terminated in accordance with its terms at any time prior to First Admission and (iii) First Admission occurring by 8:00 a.m. on 25 November 2021 (or such later date as the Company and Shore Capital may agree, being in any event not later than 8:00 a.m. on 31 January 2022). If any of these conditions is not met, the Issue will not proceed and an announcement to that effect will be made through a Regulatory Information Service.

The issue of New Shares pursuant to the Initial Placing, Offer for Subscription and Intermediaries Offer will be revoked if Admission has not occurred by 8:00 a.m. on 25 November 2021 (or such later date as the Company and Shore Capital may agree, being in any event not later than 8:00 a.m. on 31 January 2022) or, if earlier, on the date on which the Issue ceases to be capable of becoming conditional. Any such revocation will be announced by the Company through a Regulatory Information Service as soon as practicable after the Company has become aware of the occurrence of the event that has resulted in such revocation.

In the event that the Issue does not proceed for whatever reason, application monies will be returned, without interest, to investors by returning an investor's cheque or by crossed cheque in favour of the first named applicant, by post at the risk of the person entitled thereto.

9. Scaling back

Subject to the approval of the Share Allotment Authorities at the General Meeting, the Directors will be authorised to issue up to 300 million C Shares or Ordinary Shares pursuant to the Issue. To the extent that aggregate demand exceeds 300 million C Shares, or 300 million Ordinary Shares, applications under the Initial Placing, Offer for Subscription and Intermediaries Offer will be scaled back on such basis as Shore Capital may determine (in consultation with the Company). The Company reserves the right to decline in whole or in part any application for New Shares pursuant to the Issue. Accordingly, applicants for New Shares may, in certain circumstances, not be allotted the number of New Shares for which they have applied.

There will be no priority given to applications under the Initial Placing, Offer for Subscription Applications or Intermediaries Offer pursuant to the Issue.

To the extent that the subscription monies received by the Company in relation to any application for New Shares through the Initial Placing, Offer for Subscription or Intermediaries Offer exceed the aggregate value, at the Issue Price, of the New Shares issued pursuant to such application, the Company will notify investors of the number of New Shares in respect of which their application has been successful and the balance of the subscription monies of such sum will be returned as soon as reasonably practicable without interest by crossed cheque in favour of the first named applicant, sent by post to, and at the risk of the applicant concerned.

10. Pricing and costs of the Issue

The Company is targeting the issue of up to 150 million New Shares under the Issue at the Issue Price. All Shares issued pursuant to the Issue will be paid up to the Issue Price.

The costs of the Issue payable by the Company are estimated at £2.7 million.

6 The Directors have reserved the right, in consultation with Shore Capital, to increase the size of the Issue by up to 150 million New Shares if overall demand exceeds 150 million New Shares. Any such increase will be announced through an RNS announcement.

The Issue Price for Ordinary Shares issued pursuant to the Issue will be at a premium to the prevailing NAV at the date of determination of the issue price which, over the course of the Issue and the Placing Programme is intended to cover the fixed costs of the Issue. The final Issue Price is to be determined by the Board at its discretion and will be announced via an RIS prior to Admission. It is expected that the costs of the Issue will be recovered through the Issue Price, although the recovery of all or any part of the costs cannot be guaranteed.

11. Use of proceeds

The proceeds of the Issue will comprise cash received under the Initial Placing, the Offer for Subscription and Intermediaries Offer.

Please refer to paragraph 9 of Part 6 of this Prospectus for further information on the use of proceeds of the Issue.

12. Money laundering

Pursuant to anti-money laundering laws and regulations with which the Company must comply in the United Kingdom, the Company and its agents, the AIFM, the Administrator, the Registrar, the Receiving Agent, Rising Sun or Shore Capital may require evidence of the identity of each investor in connection with any application for New Shares, including further identification of the applicant(s) before any New Shares are issued.

Each of the Company and its agents, including the AIFM, the Administrator, the Registrar, the Receiving Agent, Rising Sun and Shore Capital reserves the right to request such information as is necessary to verify the identity of a Shareholder or prospective Shareholder and (if any) the underlying beneficial owner or prospective beneficial owner of a Shareholder's New Shares. In the event of delay or failure by the Shareholder or prospective Shareholder to produce any information required for verification purposes, the Directors, in consultation with the Company's agents, including the AIFM, the Administrator, the Registrar, the Receiving Agent and Shore Capital may refuse to accept a subscription for New Shares.

13. US purchase and transfer restrictions

This Prospectus does not constitute an offer to sell, or the solicitation of an offer to acquire or subscribe for, Shares in any jurisdiction where such an offer or solicitation is unlawful or would impose any unfulfilled registration, qualification, publication or approval requirements on the Company, Rising Sun or Shore Capital.

The Company has elected to impose the restrictions described below on the issue and on the future trading of the New Shares so that the Company will not be required to register the offer and sale of the New Shares under the Securities Act, so that the Company will not have an obligation to register as an investment company under the Investment Company Act and related rules and to address certain ERISA, Tax Code, FATCA and other considerations. These transfer restrictions, which will remain in effect until the Company determines in its sole discretion to remove them, may adversely affect the ability of holders of the Shares to trade such securities. Due to the restrictions described below, potential investors in the United States and U.S. Persons are advised to consult legal counsel prior to making any offer, resale, exercise, pledge or other transfer of the Shares. The Company and its agents will not be obligated to recognise any resale or other transfer of the Shares made other than in compliance with the restrictions described below.

14. Restrictions due to lack of registration under the Securities Act and Investment Company Act restrictions

The Shares have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction of the United States and the C Shares may not be offered, sold, resold, transferred or delivered, directly or indirectly, within the United States or to, or for the account or benefit of, U.S. Persons. There will be no public offer of the Shares in the United States. The Shares are being offered and sold solely (i) outside the United States to persons who are not U.S. Persons in "offshore transactions" as defined in and pursuant to Regulation S under the Securities Act; and (ii) within the United States to, or to U.S. Persons that are, both QIBs and QPs pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

Moreover, the Company has not been and will not be registered under the Investment Company Act and investors will not be entitled to the benefits of the Investment Company Act. The Shares and any beneficial interests therein may only be transferred in an offshore transaction in accordance with Regulation S under the Securities Act (i) to a person outside the United States and not known by the transferor to be a U.S. Person, by pre-arrangement or otherwise; or (ii) to the Company or a subsidiary thereof.

General

Subject to their right of withdrawal pursuant to Article 23(2) of the UK Prospectus Regulation, in the event of the publication of a supplementary prospectus, applicants under the Offer for Subscription or Intermediaries Offer may not withdraw their applications for Shares.

Applicants under the Offer for Subscription or Intermediaries Offer wishing to exercise their statutory right of withdrawal pursuant to Article 23(2) of the UK Prospectus Regulation after the publication of a supplementary prospectus or, in the case of an issue of Ordinary Shares, after the announcement of the Issue Price, must do so by lodging a written notice of withdrawal (which shall include a notice sent by any form of electronic communication) which must include the full name and address of the person wishing to exercise statutory withdrawal rights and, if such person is a CREST member, the Participant ID and Member Account ID of such CREST member by post or by hand (during normal business hours only) to Computershare Investor Services PLC at The Pavilions, Bridgwater Road, Bristol BS13 8AE so as to be received by no later than two Business Days after the date on which the supplementary prospectus is published. Notice of withdrawal given by any other means or which is deposited with or received by the Registrar will not permit the exercise of withdrawal rights after payment by the relevant applicant of his, her or its subscription in full and the allotment of New Shares to such applicant becoming unconditional and in such event investors are recommended to seek independent legal advice.

PART 12

PLACING PROGRAMME

Introduction

The Company has made arrangements under which the Board has discretion to issue New Ordinary Shares and/or C Shares under the Placing Programme, provided that such number of Ordinary Shares (including New Ordinary Shares) and Shares issued pursuant to the Issue and the Placing Programme may not exceed 300 million Shares in aggregate. The Placing Programme is intended to be flexible and may have a number of closing dates in order to provide the Company with the ability to issue Ordinary Shares and/or C Shares over a period of time. The Placing Programme is intended to satisfy market demand for Shares and to raise further money for investment in accordance with the Company's investment policy.

Background to and reasons for the Placing Programme

Subject to the passing of the Share Allotment Authorities at the General Meeting, the Company will have the flexibility to issue further Ordinary Shares or C Shares on a non-pre-emptive basis where there appears to be reasonable demand for Ordinary Shares in the market, for example if the Ordinary Shares trade at a premium to their Net Asset Value per Ordinary Share. In addition, any New Ordinary Shares issued under the Placing Programme will be issued at a price not less than the last published cum income Net Asset Value per Ordinary Share, as determined by the Directors. An issue of New Ordinary Shares under the Placing Programme may be used by the Company to reduce any premium over NAV at which its Shares may be trading.

It is expected that the Board will issue C Shares rather than New Ordinary Shares in circumstances where there is substantial investor demand such that an issue of New Ordinary Shares would have the potential to exert "cash drag" on the performance of the existing Ordinary Shares. The assets representing the net proceeds of an issue of C Shares would be accounted for as a separate pool, and the C Shares would bear a proportionate share of the Company's costs and expenses, until such pool is substantially invested in accordance with the Company's investment policy, following which the C Shares would be converted into New Ordinary Shares based on the respective NAV per Ordinary Share and NAV per C Share.

For the purposes of assessing the conversion date of an issue of C Shares into New Ordinary Shares, a separate pool underlying an issue of C Shares will be deemed to have been substantially invested when at least 90 percent (or such other percentage as the Directors determine) of the pool has been invested.

The C Shares will carry voting rights at general meetings of the Company. The detailed terms of the C Shares are set out in paragraph 3.19 of Part 14 (General Information) of this Prospectus.

Shareholder authority to issue Ordinary Shares and/or C Shares pursuant to the Placing Programme on a non-pre-emptive basis will be sought at the General Meeting. In utilising its discretion under the Placing Programme and in seeking such authority, the Directors intend to take into account relevant factors, including the desirability of limiting the premium to Net Asset Value at which the Ordinary Shares trade in order to ensure that Shareholders and new investors who acquire Ordinary Shares are not disadvantaged by being required to acquire additional Ordinary Shares at a high premium to NAV per Ordinary Share.

Benefits of the Placing Programme

The Directors believe that the issue of Ordinary Shares or C Shares pursuant to the Placing Programme should yield the following principal benefits:

(a) maintaining the Company's ability to issue New Ordinary Shares or C Shares, so as to better manage the premium at which the Ordinary Shares may trade to NAV per Ordinary Share;

(b) enhancing the NAV per Ordinary Share of existing Ordinary Shares through new share issuances of New Ordinary Shares, as New Ordinary Shares are intended to be issued at a premium of at least 1.3 per cent. to the last published cum income NAV per Ordinary Share;

(c) growing the Company, thereby spreading operating costs over a larger capital base which should reduce the total expense ratio; and

(d) improving liquidity in the market for the Ordinary Shares.

Voting dilution

If 150 million New Ordinary Shares or C Shares are issued pursuant to the Placing Programme, assuming the Issue has been subscribed as to 150 million Shares, a Shareholder holding one per cent. of the Shares following the Issue and not participating in the Placing Programme would suffer a dilution of 37 per cent. in their voting control of the Company immediately after the Issue of such Placing Programme Shares (and prior to the conversion of any C Shares). The voting rights may be further diluted on conversion of any C Shares depending on the applicable conversion ratio. However, because no Ordinary Shares will be issued at a discount to prevailing NAV, and the Company intends New Ordinary Shares are issued at a premium of at least 1.3 per cent. to the last published cum income NAV per Ordinary Share, there will be no dilution in the NAV per Ordinary Share as a result of any subsequent issue under the Placing Programme.

The Placing Programme

The Placing Programme will open on 29 November 2021 and will close on 24 October 2022. The maximum number of New Ordinary Shares and/or C Shares to be issued pursuant to the Placing Programme will be equal in aggregate to 300 million Shares less any Shares issued pursuant to the Issue. No New Ordinary Shares will be issued at a discount to the Net asset Value per ordinary Share at the time of the relevant allotment. The Company will not issue any New Ordinary Shares at a discount of 10 per cent. or more to the middle market price of the Ordinary Share at the relevant time without further Shareholder approval.

The issue of New Ordinary Shares or C Shares under the Placing Programme is at the discretion of the Directors. Issues may take place at any time prior to the closing date of the Placing Programme. An announcement of each issue under the Placing Programme will be released through an RIS. Whilst it is expected that all New Ordinary Shares and C Shares (as applicable) issued pursuant to the Placing Programme will be issued in uncertificated form, if any New Ordinary Shares or C Shares are issued in certificated form it is expected that share certificates will be despatched within 10 Business Days after the relevant issue date.

Payment for any Shares issued under the Placing Programme should be made in accordance with settlement instructions provided to Placees by Shore Capital.

The Placing Programme is not being underwritten and, as at the date of this Prospectus, the actual number of New Ordinary Shares and/or C Shares to be issued under the Placing Programme is not known. The number of New Ordinary Shares and/or C Shares available under the Placing Programme should not be taken as an indication of the number of New Ordinary Shares and/or C Shares finally to be issued.

So far as the Directors are aware as at the date of this Prospectus, no major Shareholders or Directors intend to make a commitment for New Ordinary Shares or C Shares under the Placing Programme.

Applications will be made to the London Stock Exchange for the New Ordinary Shares and C Shares issued pursuant to the Placing Programme to be admitted to the Specialist Fund Segment of the Main Market of the London Stock Exchange. All New Ordinary Shares and C Shares issued pursuant to the Placing Programme will be issued conditionally on such Admission occurring. This Prospectus has been published in order that any New Ordinary Shares and C Shares issued pursuant to the Placing Programme may be admitted to trading on the Specialist Fund Segment of the Main Market of the London Stock Exchange. This will include any Ordinary Shares issued under the Directors' existing authority to issue Ordinary Shares and/or C Shares on a non-pre-emptive basis after the date of this Prospectus. Should the Board wish to issue New Ordinary Shares or C Shares in excess of the amount for which it is then authorised to issue, further authorities may be sought at an appropriate time by convening a general meeting for this purpose.

The New Ordinary Shares issued pursuant to the Placing Programme will rank pari passu with the Ordinary Shares then in issue (save for any dividends or other distributions declared, made or paid on the Ordinary Shares by reference to a record date prior to the issue of the relevant New Ordinary Shares).

The C Shares issued pursuant to the Placing Programme:

(a) will not be entitled to any dividends payable in respect of the Ordinary Shares but on their conversion into New Ordinary Shares they will rank pari passu with the Ordinary Shares then in issue (save for any dividends or other distributions declared, made or paid on the Ordinary Shares by reference to a record date prior to the conversion of the C Shares); and

(b) will be entitled to any dividends payable in respect of the pool of assets attributable to the relevant C Shares. It is intended that dividends will be declared on the C Shares only in the event that there is

material net income available for distribution to the C Shares, but the level of dividends (if any) declared on the C Shares will depend on the actual timing and terms of the deployment of the relevant C Share issue proceeds. In the event that any net income attributable to the C Shares is not distributed as dividend, such net income will be included in the value of the C Shares when calculating their entitlement for New Ordinary Shares upon their conversion.

There is no maximum number of tranches of C Shares that may be issued pursuant to the Placing Programme, but the Company will not issue any C Shares under the Placing Programme until such time as any previous tranche of C Shares (including the C Shares to be issued pursuant to the Placing Programme) have been converted to Ordinary Shares in accordance with the Articles. There will therefore be a maximum of one tranche of C Shares in issue at any one time.

The Placing Programme will be suspended at any time when the Company is unable to issue New Ordinary Shares and/or C Shares pursuant to the Placing Programme under any statutory provision or other regulation applicable to the Company or otherwise at the Directors' discretion.

In the event that there is any significant new factor, material mistake or material inaccuracy affecting any of the matters described in this Prospectus after the publication of this Prospectus and prior to the termination of the Placing Programme, the Company will publish a supplementary prospectus. Any supplementary prospectus published by the Company will give details of the significant new factor, material mistake or material inaccuracy.

6. Conditions

Each allotment and issue of Ordinary Shares and/or C Shares under the Placing Programme following the Issue, is conditional, among other things, on:

(a) the Share Allotment Authorities being passed at the General Meeting and not having been revoked or superseded;

(b) in the case of New Ordinary Shares, the Placing Programme Price being determined by the Directors as described below;

(d) the Placing Agreement becoming otherwise unconditional in respect of the relevant issue of New Ordinary Shares and/or C Shares in all respects and not having been terminated on or before the date of such Admission; and

(e) a valid supplementary prospectus being published by the Company if such is required by the UK Prospectus Regulation.

In circumstances where these conditions are not fully met, the relevant issue of New Ordinary Shares or C Shares pursuant to the Placing Programme will not take place.

7. Calculation of the Placing Programme Price

The Placing Programme Price of the New Ordinary Shares will be calculated by reference to the last published cum income Net Asset Value of each existing Ordinary Share together with a premium intended to at least cover the costs and expenses of the placing pursuant to the Placing Programme (including, without limitation, any placing commissions), such costs and expenses being estimated at approximately 1.3 per cent. of the amounts raised ("Subsequent Expenses"). The Directors will determine the Placing Programme Price on the basis described above so as to cover the costs and expenses of each placing of New Ordinary Shares under the Placing Programme and thereby avoid any dilution of the Net Asset Value of the existing Ordinary Shares held by Shareholders. By way of illustration, assuming a last published cum income NAV of 120p per Ordinary Share, the Placing Programme Price per New Ordinary Share would be expected to be at least 121.6p, and the expenses indirectly borne by an investor in such New Ordinary Shares would be at least 1.6p per Ordinary Share.

The Placing Programme Price of any C Shares issued pursuant to the Placing Programme will be 100p per C Share and the costs of the relevant issue of such C Shares will be paid out of the proceeds of the issue and accordingly will be borne indirectly by investors in the relevant C Shares. Such expenses are not expected to exceed 1.4 per cent. of the gross proceeds of the relevant Subsequent Placing in each case.

Fractions of New Ordinary Shares or C Shares will not be issued.

The net proceeds of the Placing Programme is dependent on the number of New Ordinary Shares and/or C Shares issued pursuant to the Placing Programme and the applicable Placing Programme Price of any New Ordinary Shares issued.

Where New Ordinary Shares or C Shares are issued, the total assets of the Company will increase by that number of New Ordinary Shares or C Shares issued multiplied by the applicable Placing Programme Price. It is not expected that there will be any material impact on the earnings and Net Asset Value per Ordinary Share, as the net proceeds resulting from any issue under the Placing Programme are expected to be invested in investments consistent with the investment objective and investment policy of the Company and the Placing Programme Price of the New Ordinary Shares is expected to represent a modest premium to the then prevailing Net Asset Value per Ordinary Share.

8. Subscriber warranties

Each subscriber of Shares in the Placing Programme and each subsequent investor in the Shares will be deemed to have represented, warranted, acknowledged and agreed to the representations, warranties, acknowledgements and arrangements set out in sections 4 and 5 in Part 16 (Terms and conditions of Application under the Initial Placing and the Placing Programme) of this Prospectus.

The Company, the AIFM, the Investment Adviser, Shore Capital and their respective directors, officers, members, agents, employees, advisers and others will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgments and agreements.

If any of the representations, warranties, acknowledgments or agreements made by the investor are no longer accurate or have not been complied with, the investor will immediately notify the Company.

9. Settlement

Payment for New Ordinary Shares and C Shares issued under the Placing Programme will be made through CREST or through Shore Capital, in any such case in accordance with settlement instructions to be notified to Places by Shore Capital. In the case of those subscribers not using CREST, monies received by and held in account by or on behalf of Shore Capital will not be held as client money within the meaning of the relevant provisions of the FCA Handbook, which therefore will not require Shore Capital to segregate such money, as that money will be held by Shore Capital under a banking relationship and not as trustee. To the extent that any placing commitment is rejected in whole or in part, any monies received will be returned without interest at the risk of the Places.

10. Programme Admission and dealings

There will be no conditional dealings in Shares prior to each Programme Admission.

The ISIN for the Ordinary Shares to be admitted to trading in connection with the Placing Programme is GB00BKLGLS10, and the SEDOL is BKLG1S1.

The ISIN and SEDOL for any tranches of C Shares to be issued by the Company under the Placing Programme will be published by the Company at the appropriate time.

The Company does not guarantee that at any particular time market maker(s) will be willing to make a market in the Shares, nor does it guarantee the price at which a market will be made in the issue Shares. Accordingly, the dealing price of the Shares may not necessarily reflect changes in the Net Asset Value per Ordinary Share or C Share (as applicable).

The Shares are in registered form and can also be held in uncertificated form. Prior to the despatch of definitive share certificates in respect of any Shares which are held in certificated form, transfers of those Shares will be certified against the register of members of the Company. No temporary documents of title will be issued.

11. Costs of the Placing Programme

The costs and expenses of each subsequent issue of Ordinary Shares or C Shares under the Placing Programme will depend on subscriptions received. Assuming that £100 million is raised pursuant to the Placing Programme before expenses solely through the issue of New Ordinary Shares, and assuming costs of the Placing Programme of 1.3 per cent. of the gross proceeds, the net proceeds of the Placing Programme would be approximately £201.3 million.

Use of proceeds

Please refer to paragraph 9 of Part 6 of this Prospectus for further information on the use of proceeds of the Placing Programme.

Scaling back

The Directors are authorised to issue and allot up to 300 million New Ordinary Shares and/or C Shares, less any Shares issued pursuant to the Issue, pursuant to the Placing Programme. To the extent that commitments under the Placing Programme exceed 300 million New Ordinary Shares and/or C Shares in aggregate, (inclusive of C Shares issued pursuant to the Issue), applications will be scaled back at Shore Capital's discretion (in consultation with the Company) and in such manner and amounts as it considers appropriate. Accordingly, applicants for Shares may, in certain circumstances, not be allotted the number of Shares for which they have applied.

The Company will notify investors of the number of Shares in respect of which their application has been successful and the results of each issue under the Placing Programme will be announced by the Company via an RIS.

Subscription monies received in respect of unsuccessful applications (or to the extent scaled back) will be returned without interest at the risk of the applicant.

Money laundering

Pursuant to anti-money laundering laws and regulations with which the Company must comply in the United Kingdom, the Company and its agents, the AIFM, the Administrator, the Registrar, the Receiving Agent, Rising Sun or Shore Capital may require evidence of the identity of each investor in connection with any application for Shares, including further identification of the applicant(s) before any Shares are issued.

Each of the Company and its agents, including the AIFM, the Administrator, the Registrar, the Receiving Agent, Rising Sun and Shore Capital reserves the right to request such information as is necessary to verify the identity of a Shareholder or prospective Shareholder and (if any) the underlying beneficial owner or prospective beneficial owner of a Shareholder's Shares. In the event of delay or failure by the Shareholder or prospective Shareholder to produce any information required for verification purposes, the Directors, in consultation with the Company's agents, including the AIFM, the Administrator, the Registrar, the Receiving Agent and Shore Capital may refuse to accept a subscription for Shares.

US purchase and transfer restrictions

The Company has elected to impose the restrictions described below on the issue and on the future trading of the Shares so that the Company will not be required to register the offer and sale of the Shares under the Securities Act, so that the Company will not have an obligation to register as an investment company under the Investment Company Act and related rules and to address certain ERISA, Tax Code, FATCA and other considerations. These transfer restrictions, which will remain in effect until the Company determines in its sole discretion to remove them, may adversely affect the ability of holders of the Shares to trade such securities. Due to the restrictions described below, potential investors in the United States and U.S. Persons are advised to consult legal counsel prior to making any offer, resale, exercise, pledge or other transfer of the Shares. The Company and its agents will not be obligated to recognise any resale or other transfer of the Shares made other than in compliance with the restrictions described below.

Restrictions due to lack of registration under the Securities Act and Investment Company Act restrictions

The Shares have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction of the United States and the Shares may not be offered, sold, resold, transferred or delivered, directly or indirectly, within the United States or to, or for the account or benefit of, U.S. Persons. There will be no public offer of the Shares in the United States. The Shares are being offered and sold solely (i) outside the United States to persons who are not U.S. Persons in "offshore transactions" as defined in and pursuant to Regulation S under the Securities Act; and (ii) within the United States to, or to U.S. Persons that are, both QIBs and QPs pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

PART 13

UNITED KINGDOM AND JAPANESE TAXATION

The information below is a general, non-exhaustive guide based on current United Kingdom ("UK") and Japanese tax law and HMRC published practice, both of which are subject to change. It does not constitute legal or tax advice.

It summarises the UK and Japanese tax position of the Company and of Shareholders who are UK resident (except where indicated) and hold Shares as investments and who are not subject to special UK tax treatment by virtue of their status. Prospective investors who are in any doubt about their tax position are recommended to take professional advice.

The tax legislation of an investor's home country and of the UK (being the Company's country of incorporation) may have an impact on the income received from the Shares (if any).

The comments apply only to Shareholders who are the beneficial owners of their Shares.

The Company

The Company has obtained from HMRC approval as an investment trust pursuant to section 1158 of the Corporation Tax Act 2010. It is the intention of the Directors to continue to conduct the Company's affairs so that it qualifies to receive approval as an investment trust and continues to be so approved. Neither Rising Sun nor the Directors can guarantee that this approval will be granted or maintained. The following comments are made on the basis that the Company is approved as an investment trust and that the approval is maintained.

As an investment trust the Company should generally be exempt from UK tax on chargeable gains realised on the disposal of investments, including interest-paying securities and derivatives, held within it.

Dividends from UK and non-UK companies should generally be exempt from UK tax in the hands of the Company (although not necessarily from withholding tax imposed by other jurisdictions) because there are various exemptions from UK tax on dividends which are available for UK companies, including those which are not investment trusts.

Other (non-dividend) income received by the Company should, after deduction of allowable management fees and any other allowable costs, generally be subject to UK corporation tax currently at 19 per cent. (expected to rise to 25 per cent. from April 2023).

However, to the extent that the Company receives qualifying interest income, then, as an investment trust, it should have the option of designating dividends paid by it as interest distributions. Insofar as the Company pays interest distributions it should generally be able to deduct that amount from its income in calculating its profit for corporation income tax purposes.

Japan

Neither the Company nor Rising Sun have sought a ruling from the Japanese tax authorities regarding any taxation matter summarized below.

The Japanese taxation matters discussed below are based on investments by the Company as contemplated herein.

Income or gains from the Company's underlying investments in Japan, anticipated to be primarily in the form of dividends and interest from Japanese companies (that is, companies which have their head or main offices in Japan) and capital gains from the disposal of shares in Japanese companies, may be subject to withholding taxes or other taxes, as summarized below.

UK – Japan Tax Treaty

The Company should be treated as a foreign corporation for Japanese tax purposes and treated as directly investing in the underlying Japanese share investments.

Under the Convention between the United Kingdom of Great Britain and Northern Ireland and Japan for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital Gains (“UK-Japan Tax Treaty”), a “resident” of the UK is any person who, under the law of the UK, is liable to tax in the UK by reason of his domicile, residence, place of head or main office, place of management, place of incorporation or any other criterion of a similar nature. In order to be entitled to certain benefits which are granted by the provisions of the UK-Japan Tax Treaty on dividends, interest, royalties, capital gains and certain other categories of income, a resident of the UK must be a “qualified person”. If the principal class of shares of a company is listed, registered or admitted to dealing on (and is regularly traded on) a “recognised stock exchange” it should be treated as a qualified person for these purposes.

The Company expects to be treated as both a resident of the UK and a qualified person for the above purposes under the UK-Japan Tax Treaty.

Dividends

The Company will be subject to withholding tax on dividends from Japanese companies. Under Japanese domestic law, the withholding tax rates on dividends from listed companies is 15.315 per cent. (inclusive of income surtax) and from private companies is 20.42 per cent. (inclusive of income surtax).

For a foreign corporation without a permanent establishment in Japan, this withholding tax is a final tax.

Under the UK-Japan Tax Treaty, the withholding tax on portfolio dividends can be reduced to 10 per cent., and further, exempt if the Company owns (directly or indirectly) at least 10 per cent. of the voting power of the Japanese company paying the dividends for the period of six months. To qualify for this relief, the Company must not have any permanent establishment in Japan (except in the case that the holding of relevant shares is not effectively connected with such permanent establishment) and must be the beneficial owner of the dividend. It will also be required to fulfil certain conditions and duly file application forms with the Japanese tax authorities when claiming this relief.

Interest distributions

The Company will be subject to withholding tax on interest from Japanese companies. The withholding tax rate on interest from bonds is generally 15.315 per cent. (inclusive of income surtax), unless a domestic exemption applies (for example, for certain government and corporate bond interest), whereas, the withholding tax rate on loan interest is 20.42 per cent. (inclusive of income surtax).

For a foreign corporation without a permanent establishment in Japan, this withholding tax is a final tax.

Nevertheless, any withholding tax on interest may be exempt under the UK-Japan Tax Treaty (except for certain interest that is determined by reference to sales or profits of the debtor or to any dividend made by the debtor and so on, to which 10 per cent. withholding tax will be applicable). To qualify for this exemption, the Company must not have any permanent establishment in Japan (except in the case that the relevant debt-claim is not effectively connected with such permanent establishment) and must be the beneficial owner of the interest. It will also be required to fulfil certain conditions and duly file application forms with the Japanese tax authorities when claiming this relief.

Capital Gains or Sale of Shares

In general, a foreign corporation without a permanent establishment in Japan is not subject to Japanese taxation on the sale of shares except in the following cases (a) to (c) below. Where any of the rules described in (a) to (c) are triggered, a filing obligation will arise for the Company in Japan. The tax rate generally applicable for corporate investors (such as the Company) is approximately 25.59 per cent. (effective from fiscal years beginning on or after 1 October 2019) and where the tax is due by filing national tax returns within two months following the fiscal year of the Company in which the gain arose.

(a) 25/5 Rule

If the Company (together with special related persons) sells five per cent. or more of the shares in a Japanese company (that is, a company which has its head or main office in Japan) in any fiscal year and, at any time during the fiscal year of sale or two prior years, owns or has owned (together with special related persons) 25 per cent. or more of the shares in such Japanese company, then the gain is subject to corporation income tax even if the Company does not have a permanent establishment in Japan (“25/5 Rule”).

(b) Real Estate Holding Company Rule

If the Company (together with special related persons) owns more than five per cent. of the shares in a real estate holding company (broadly, a company, Japanese or not, whose gross assets consist, in fair market value, 50 per cent. or more of real estate assets in Japan or shares in other real estate holding companies) during the 365-day period prior to the date of sale, then any gain on the sale of those shares is subject to corporation income tax even if the Company does not have a permanent establishment in Japan. If the real estate holding company is privately held (i.e., not listed), the aforementioned five per cent. threshold is reduced to 2 per cent.

If the Company engages in improper market manipulation, such as greenmail, then the gains from such market manipulation may be subject to corporation income tax in Japan.

Any capital gains made by the Company should be exempt from the Japanese corporation income tax under the UK-Japan Tax Treaty, subject to the treaty requirements and tax filing, unless the capital gain is derived from the transfer of shares where the shares or the interest derive at least 50 per cent. of their value directly or indirectly from immovable property situated in Japan, in which case the domestic assessing rules as stated in (b) can apply. The UK-Japan Tax Treaty overrides the domestic assessing rules as stated in (a) and (c) above.

Permanent Establishment

The determination of whether the Company is considered to have a permanent establishment in Japan is based on the relevant facts and circumstances. For instance, if a person other than an agent of an independent status is acting on behalf of the Company, habitually exercises an authority to conclude contracts on behalf of the Company in Japan, the Company shall be deemed to have permanent establishment in Japan. The Company intends to conduct its affairs with respect to Japan in such a way as to avoid being deemed or treated to have a permanent establishment in Japan. There can be no assurance, however, that the Japanese tax authorities will not seek to assert that the Company has a permanent establishment in Japan or that such an assertion will not be upheld.

If the Company were to have a permanent establishment in Japan, income of the Company, as well as any other income allocable to such permanent establishment under domestic attribution rules or as determined under an attribution clause in a tax treaty, would likely be subject to tax at full Japanese tax rates. In such case, the effective Japanese tax rates at which such income would be subject to corporation income tax would be approximately 30 per cent. (if the Company has a paid-up capital of over JPY100 million).

Shareholders

All distributions are paid without deduction on account of any UK tax and without any notional tax credit attached. Shareholders in the UK and other countries may be liable to account for tax to the tax authority in their country of residence. The following comments refer only to the UK tax liabilities of UK resident Shareholders and to UK withholding tax.

Dividends

Individual UK resident Shareholders are entitled to an annual dividend allowance (currently £2,000). For dividends received in excess of the allowance the income tax rates are currently 7.5 per cent. for dividend income within the basic rate tax band, 32.5 per cent. for dividend income within the higher rate tax band and 38.1 per cent. for dividend income taxable in the additional rate tax band. The income tax rates applicable to dividend income falling within these bands are set to increase to 8.75 per cent., 33.75 per cent. and 39.35 per cent., respectively, from April 2022.

UK-resident company Shareholders should normally be able to take advantage of one of a number of exemptions from corporation tax on dividends received from the Company.

Non-UK resident Shareholders should not be subject to any UK withholding tax on dividends.

Interest Distributions

Generally, if the Company pays interest distributions then individual UK Shareholders should treat those distributions as interest received without any tax deducted. Individuals may be entitled to an annual savings

allowance on interest depending on their highest marginal tax rate. (The allowance is currently £1,000 per year for basic and nil rate taxpayers, £500 per year for higher rate taxpayers and nil for additional rate taxpayers.) For interest and interest distributions received in excess of the savings allowance the income tax rates are currently 20 per cent. (basic rate), 40 per cent. (higher rate), and 45 per cent. (additional rate).

A UK resident company Shareholder should treat an interest distribution received from the Company for corporation tax purposes as if it were interest on a creditor loan relationship.

Non-UK resident Shareholders should not be subject to any UK withholding tax on interest distributions. Non-UK residents Shareholders may be taxed differently in their own jurisdiction, including if the distributions are treated as dividends. Non-UK resident Shareholders should confirm the position in their own jurisdiction.

Tax on Chargeable Gains

A disposal of Shares by a Shareholder may give rise to a chargeable gain or an allowable loss for the purposes of UK taxation of capital gains, depending on the Shareholder's circumstances and subject to any available exemption or relief.

Individual UK resident Shareholders with chargeable gains in excess of their annual allowance (£12,300 in tax year 2020-21) may be liable to capital gains tax on any chargeable gains realised on the disposal of Shares at 10 per cent. (for a gain falling within the basic rate tax band) or 20 per cent. (for a gain falling within the higher or additional rate tax bands).

For UK resident company Shareholders any chargeable gains on the disposal of Shares should be within the charge to corporation tax. It may be possible to set allowable losses against chargeable gains in the same or a later period.

ISAs and SIPPs

The Company has obtained approval as an investment trust from HMRC for the purposes of section 1158 of the Corporation Tax Act 2010. On this basis, and on the basis that the Company continues to satisfy the conditions for approval as an investment trust, the Shares should be eligible for inclusion in a stocks and shares individual savings account ("ISA"). The Shares should also be eligible for inclusion in a self-invested personal pension or ("SIPP").

Stamp Duty and Stamp Duty Reserve Tax ("SDRT")

The following comments are intended as a guide to the general stamp duty and SDRT position in relation to Shares and do not relate to persons such as market makers, brokers, dealers, intermediaries and persons connected with depository arrangements or clearance services, to whom special rules apply.

No UK stamp duty or SDRT should be payable on the issue of Shares. Transfers on sale of Shares outside of CREST will generally be subject to UK stamp duty, normally payable by the purchaser at the rate of 0.5 per cent. of the consideration given for the transfer, rounded up to the nearest £5. An exemption from stamp duty is available for instruments transferring shares where the amount or value of the consideration is £1,000 or less and it is certified on the instrument that the transaction effected by it does not form part of a larger transaction or series of transactions in respect of which the aggregate amount or value of the consideration exceeds £1,000.

An agreement to transfer Shares will normally give rise to a charge to stamp duty reserve tax ("SDRT") for the purchaser at the rate of 0.5 per cent. of the amount or value of the consideration therefor. If a duly stamped transfer executed in pursuance of the agreement is produced within six years of the date on which the agreement is made (or, if the agreement is conditional, the date on which the agreement becomes unconditional) any SDRT paid is repayable, generally with interest, and otherwise the SDRT charge is cancelled.

Paperless transfers of Ordinary Shares within the CREST system will generally be liable to SDRT at the rate of 0.5 per cent. of the amount or value of the consideration payable. Such SDRT will generally be collected through the CREST system. Deposits of Shares into CREST will not generally be subject to SDRT, unless the transfer into CREST is itself for consideration.

Transfers of Shares to a company connected with the transferor may be subject to UK stamp duty or SDRT (as applicable) on the market value of the Ordinary Shares transferred, if this is higher than the consideration.

Reporting requirements

Under legislation implementing the UK's obligations under various intergovernmental agreements relating to the automatic exchange of information to improve international tax compliance (including but not limited to the international Common Reporting Standard,) the Company may be required to collect and report information about Shareholders and their investments to HMRC, including information to verify their identity and tax residence. When requested to do so by the Company or its agent, Shareholders must provide information to be passed on to HMRC, and, by them, to any relevant overseas tax authorities.

On request from HMRC the Company must provide details of interest distributions and recipients.

THE PRECEDING DISCUSSION IS NOT A FULL DESCRIPTION OF THE COMPLEX TAX RULES RELEVANT TO AN INVESTMENT IN THE COMPANY. THE TAX AND OTHER MATTERS DESCRIBED HEREIN DO NOT CONSTITUTE, AND SHOULD NOT BE CONSIDERED AS, LEGAL OR TAX ADVICE TO PROSPECTIVE SHAREHOLDERS. EACH PROSPECTIVE SHAREHOLDER SHOULD CONSULT WITH ITS OWN PROFESSIONAL TAX ADVISOR WITH RESPECT TO THE TAX ASPECTS OF AN INVESTMENT IN THE COMPANY.

OTHER JURISDICTIONS

Prospective purchasers of Shares should consult their own professional tax advisers as to the tax consequences of the purchase, ownership and disposal of Shares. Any person who is in any doubt as to his, her or its tax position in consequence of acquiring, holding or disposing of Shares, or requires more detailed information than the general outline above should consult his, her or its own independent professional advisers.

PART 14

GENERAL INFORMATION

The Company

1.1 Incorporation and administration

(a) The Company was incorporated in England and Wales on 22 October 2019 with the name “NAVF plc” and registered number 12275668 as a public company limited by shares under the Act. On 15 November 2019 the Company changed its name to “Nippon Active Value Fund plc”, which is the Company’s legal and commercial name. The Company is registered as an investment company under section 833 of the Act. The Company has an indefinite life. The Company’s “legal entity identifier” number is 213800JOFEGZJYS21P75.

(b) The principal legislation under which the Company’s existing Ordinary Shares have been created (and under which any C Shares and/or Ordinary Shares to be issued pursuant to the Issue and the Placing Programme will be created), and under which the Company operates, is the Companies Act 2006. As a listed investment company, the Company is not regulated as a collective investment scheme by the FCA. The Company’s existing Ordinary Shares are admitted to trading on the Specialist Fund Segment of the Main Market of the London Stock Exchange. The Company is subject to the UK Prospectus Regulation, the Prospectus Regulation Rules, the Disclosure Guidance and Transparency Rules, the Takeover Code, the UK Market Abuse Regulation and the rules of the London Stock Exchange. The Company is domiciled in England and Wales. The Company is an alternative investment fund pursuant to the AIFM Rules.

(c) The Company’s audited report and accounts are prepared to 31 December each year, and the Company’s first annual report and accounts for the period from the Company’s incorporation on 22 October 2019 ended 31 December 2020 were sent to Shareholders on 14 April 2021. The unaudited half yearly reports for (i) the financial period from the Company’s incorporation on 22 October 2019 ended 30 June 2020; and (ii) the six months ended 30 June 2021, both prepared in accordance with IAS 34 Interim Financial Reporting and the Disclosure Guidance and Transparency Rules. Shareholders will continue to receive an unaudited interim report each year in respect of the periods to 30 June, expected to be despatched in August each year, or earlier if possible. The Company’s audited annual report and accounts and interim reports are available on the Company’s website. The Company’s annual and interim accounts are drawn up in sterling and in accordance with IFRS.

(d) The Company’s statutory auditor is BDO LLP, which is a member of the Institute of Chartered Accountants of England and Wales.

(e) The address of the registered office and principal place of business of the Company is 1st Floor, Senator House, 85 Queen Victoria Street, London, England, EC4V 4AB with telephone number +44 (0)20 7653 9690.

(f) The Company has no employees, all the Directors are appointed on a non-executive basis and most of its day-to-day activities are delegated to third parties.

(g) The Company has no subsidiary or parent undertakings, associated companies and neither owns nor leases any premises.

(h) Rising Sun Management Ltd. has been appointed by the Company and the AIFM as investment adviser. Rising Sun Management Ltd. is a limited liability company incorporated with indefinite life in the Cayman Islands, on 18 October 2019. The registered address and principal place of business of Rising Sun Management Ltd. is c/o Appleby Global Services (Cayman) Limited, 71 Fort Street, PO Box 500, George Town, Grand Cayman KY1-1106, Cayman Islands and the telephone number is +1 345 769 4900.

(i) On 12 November 2019, the Company was granted a certificate under section 761 of the Act entitling it to commence business and to exercise its borrowing powers.

Share capital

2.1 The Ordinary Shares are, and any C Shares to the issued pursuant to the Issue or the Placing Programme will be, denominated in Sterling and the Issue Price or applicable Placing Programme Price will be payable in Sterling.

2.2 The Company has no authorised share capital and no convertible securities, exchangeable securities or securities with warrants have been issued by the Company. Set out below is the issued share capital of the Company as at the date of this Prospectus:

	Aggregate nominal value (£)	Number
Ordinary Shares	1,030,000.01	103,000,001

At incorporation on 22 October 2019, the Company issued 1 Ordinary Share of £0.01 and 50,000 Redeemable Preference Shares of £1.00 each. On the IPO Admission Date, the 50,000 Redeemable Preference Shares were sub-divided and redesignated into 5,000,000 Ordinary Shares, and the Company issued 98,000,000 Ordinary Shares at an issue price of 100p per Ordinary Share.

2.3 Set out below is the issued share capital of the Company as it will be immediately following the Issue (assuming that 150 million Ordinary Shares are issued pursuant to the Issue):

	Aggregate nominal value (£)	Number
Ordinary Shares as at the latest practicable date	1,030,000.01	103,000,001
Ordinary Shares issued pursuant to the Issue	1,500,000.00	150,000,000
Ordinary Shares following the Issue	2,530,000.01	253,000,000

In the event that C Shares are issued pursuant to the Issue, the number of Ordinary Shares into which these C Shares will convert, and therefore the effect on the share capital of the Company, will not be known until the date of conversion.

All Ordinary Shares and C Shares are (or will be when issued) be fully paid.

2.4 By ordinary and special resolutions of the Company (in addition to the ordinary business of the Company), at the Company's annual general meeting on 12 May 2021, the following resolutions were approved by Shareholders:

(a) That the Directors be and are hereby generally and unconditionally authorised (in substitution for all subsisting authorities to the extent unused) to exercise all powers of the Company to allot ordinary shares of 1 penny each in the Company ("Ordinary Shares") up to an aggregate nominal value of £103,000 (equivalent to 10 per cent. of the issued share capital of the Company as at the date of the notice of the annual general meeting) and that such authority shall expire (unless previously varied, revoked or renewed by the Company in general meeting) at the conclusion of the annual general meeting of the Company to be held in 2022 or, if earlier, on the expiry of 15 months from the passing of the resolution, save that the Company may, at any time prior to the expiry of such authority, make an offer or enter into an agreement which would or might require the allotment of Ordinary Shares in pursuance of such an offer or agreement as if such authority had not expired.

(b) That, subject to the passing of the resolution set out in paragraph 2.4(a) above, in substitution for any existing power under sections 570 and 573 of the Act but without prejudice to the exercise of any such power prior to the date hereof, the Directors be and are hereby empowered, pursuant to sections 570 and 573 of the Act, to allot Ordinary Shares and/or sell Ordinary Shares from treasury, in each case for cash pursuant to the authority conferred by the resolution set out in paragraph 2.4(a) above up to an aggregate nominal value of £103,000 (equivalent to 10 per cent. of the issued share capital of the Company as at the date of the notice of the annual general meeting) as if section 561 of the Act did not apply to such allotment or sale and that such power shall expire (unless previously varied, revoked or renewed by the Company in general meeting) at the

conclusion of the annual general meeting of the Company to be held in 2022 or, if earlier, on the expiry of 15 months from the passing of the resolution, save that the Company may, at any time prior to the expiry of such authority, make an offer or enter into an agreement which would or might require the allotment or sale of Ordinary Shares in pursuance of such an offer or agreement as if such authority had not expired.

(c) That the Company be and is hereby generally and unconditionally authorised in accordance with section 701 of the Act to make market purchases (within the meaning of section 693(4) of the Act) of Ordinary Shares, provided that:

(i) the maximum number of Ordinary Shares hereby authorised to be purchased shall be 15,439,700 (representing 14.99 per cent. of the Company's issued share capital of the Company at the date of the notice of the annual general meeting);

(ii) the minimum price (exclusive of any expenses) which may be paid for an Ordinary Share is 1 penny;

(iii) the maximum price (exclusive of any expenses) which may be paid for each Ordinary Share is not more than the higher of:

A. five per cent. above the average of the middle market quotations for the Ordinary Shares for the five business days immediately before the day on which that Ordinary Share is contracted for purchases; and

B. the higher of the last independent trade and the highest then current independent bid for the Ordinary Shares on the trading venue where the purchase is carried out;

(iv) the authority hereby conferred shall expire at the conclusion of the annual general meeting of the Company to be held in 2022 or, if earlier, on the expiry of 15 months from the passing of the resolution, unless such authority is renewed or revoked by the Company prior to such time; and

(v) the Company may make a contract to purchase Ordinary Shares under the authority hereby conferred prior to the expiry of such authority, which will or may be executed wholly or partly after the expiration of such authority and may purchase Ordinary Shares pursuant to any such contract as if the authority had not expired.

2.5 Since the Company's incorporation, save for the Ordinary Shares referred to in paragraph 2.2 of this Part and the Redeemable Preference Shares issued to obtain the trading certificate, no share or loan capital of the Company has been issued or agreed to be issued.

3. Articles of Association

A summary of the main provisions of the Articles is set out below.

3.1 Objects

The Articles do not provide for any objects of the Company and accordingly the Company's objects are unrestricted.

3.2 Variation of rights

Subject to the provisions of the Act, if at any time the share capital of the Company is divided into different classes of shares, the rights attached to any class (unless otherwise provided by the terms of issue of the shares of that class) may be varied or abrogated either with the consent in writing of the holders of three-quarters in nominal value of the issued shares of that class or with the sanction of a special resolution passed at a separate meeting of the holders of the shares of that class (excluding any shares of that class held as treasury shares). At every such separate general meeting the necessary quorum shall be two persons holding or representing by proxy at least one-third in nominal value of the issued shares of the class in question (again, excluding any shares of that class held as treasury shares) (but at any adjourned meeting any holder of shares of the class present in person or by proxy shall be a quorum). At such separate general meeting, any holder of shares of the class present in person or by

proxy may demand a poll and every such holder shall on a poll have one vote for every share of the class held by him.

3.3 Alteration of share capital

The Company may by ordinary resolution:

(a) consolidate and divide all or any of its share capital into shares of larger nominal value than is fixed by its constitution or was fixed by the resolution creating the existing shares;

(b) sub-divide its existing shares, or any of them, into shares of smaller nominal value than its existing shares; and

(c) determine that, as between the shares resulting from such a sub-division, one or more shares may, as compared with the others, be given a preference, advantage, restriction or disadvantage as regards dividends, capital or voting.

3.4 Issue of shares

Subject to the provisions of the Act and without prejudice to any rights attaching to any existing shares, any share may be issued with such rights or restrictions, and on such terms as the as the Directors may determine (provided such terms are consistent with the Articles).

3.5 Dividends

Subject to the provisions of the Act, the Company may by ordinary resolution declare dividends in accordance with the respective rights of the Shareholders but no dividends shall exceed the amount recommended by the Directors. The Directors may pay interim dividends, or dividends payable at a fixed rate, if it appears to them that they are justified by the profits of the Company available for distribution. If the Directors act in good faith they shall not incur any liability to the holders of shares conferring preferred rights for any loss they may suffer by the lawful payment of an interim dividend on any shares having deferred or non-preferred rights.

Subject to the Act and the rights of persons (if any) entitled to shares with preferential or special rights as to dividend, all dividends shall be paid pro rata according to the amounts paid up on the shares on which the dividend is paid. If any share is issued on terms that it ranks for dividends as from a particular date, it shall rank for dividends accordingly. In any other case, dividends shall be apportioned and paid proportionately to the amount paid up on the shares during any portion(s) of the period in respect of which the dividend is paid.

3.6 Voting rights

Subject to any rights or restrictions attached to any shares, on a show of hands every Shareholder present in person has one vote, every proxy present who has been duly appointed by a Shareholder entitled to vote has one vote and every corporate representative present who has been duly authorised by a corporation has the same voting rights as the corporation would be entitled to. On a poll every Shareholder (whether present in person or by proxy or by corporate representative) has one vote for every share of which he is the holder. A Shareholder entitled to more than one vote need not, if he votes, use all his votes or cast all the votes he uses the same way. In the case of joint holders, the vote of the person whose name appears before the names of the other joint holder(s) on the Register in respect of the share and who tenders a vote shall be accepted to the exclusion of the vote of the other joint holders.

No Shareholder shall have any right to vote at any general meeting or at any separate meeting of the holders of any class of shares, either in person or by proxy, in respect of any share held by him unless all amounts presently payable by him in respect of that share have been paid.

3.7 Transfer of shares

A share in certificated form may be transferred by an instrument of transfer, which may be in any usual form or in any other form approved by the Directors, executed by or on behalf of the transferor and, where the share is not fully paid, by or on behalf of the transferee. A share in uncertificated form may be transferred by means of the relevant electronic system concerned.

In addition, the Board may refuse to register a transfer of Shares if (i) in the case of certificated Shares (a) it is in respect of more than one class of Shares, (b) it is in favour of more than four joint transferees, (c) it is not duly stamped or duly certificated to the satisfaction of the Board as being exempt from stamp duty, (d) it is delivered for registration to the registered office of the Company or such other place as the Board may decide or (e) is not accompanied by the certificate for the Shares to which it relates and such other evidence of title as the Board may reasonably require.

In addition, if at any time the holding or beneficial ownership of any Shares in the Company by any person (whether on its own or taken with other Shares), in the opinion of the Directors:

(i) would cause the assets of the Company to be treated as “plan assets” of any benefit plan investor under Section 3(42) of ERISA or the U.S. Code;

(ii) would or might result in the Company and/or its Shares and/or any of its appointed investment managers or investment advisers being required to be registered or qualified under the Investment Company Act and/or the U.S. Investment Advisers Act of 1940 and/or the Securities Act and/or the Exchange Act and/or any similar legislation (in any jurisdiction) that regulates the offering and sale of securities;

(iii) may cause the Company not to be considered a “Foreign Private Issuer” under the Exchange Act;

(iv) may cause the Company to be a “controlled foreign corporation” for the purpose of the U.S. Code; or

(v) may cause the Company to become subject to any withholding tax or reporting obligation under FATCA or any similar legislation in any territory or jurisdiction, or to be unable to avoid or reduce any such tax or to be unable to comply with any such reporting obligation (including by reason of the failure of the shareholder concerned to provide promptly to the Company such information and documentation as the Company may have requested to enable the Company to avoid or minimise such withholding tax or to comply with such reporting obligation),

then the Board may declare the Shareholder in question a “Non-Qualified Holder” and the Board may require that any Shares held by such Shareholder (“Prohibited Shares”) shall (unless the Shareholder concerned satisfies the Board that he is not a Non-Qualified Holder) be transferred to another person who is not a Non-Qualified Holder, failing which the Company may itself dispose of such Prohibited Shares at the best price reasonably obtainable and pay the net issue proceeds to the former holder.

If the Directors refuse to register or authorise the registration of a transfer of a share, they shall send notice of refusal to the transferee together with reasons for the refusal as soon as practicable and in any event within two months after the date on which the transfer was lodged with the Company or its registrar.

No fee shall be charged for the registration of any instrument of transfer or other document or instruction relating to or affecting the title to any share.

3.8 Distribution of assets on a winding-up

If the Company is wound up, with the sanction of a special resolution, the liquidator may divide among the Shareholders in specie or kind the whole or any part of the assets of the Company and for that purpose may value any assets and determine how the division shall be carried out as between the Shareholders or different classes of Shareholders. With the like sanction, the liquidator may vest the whole or any part of the assets in trustees upon such trusts for the benefit of the Shareholders as he may determine, but no Shareholder shall be compelled to accept any shares or other securities upon which there is a liability.

100

3.9 Restrictions on rights: failure to respond to a Section 793 notice or other notice

If a Shareholder, or any other person appearing to be interested in shares held by that Shareholder, fails to provide the information requested in a notice given to him under section 793 of the Act by the Company in relation to his interest in shares (the "Default Shares") within the period of compliance specified in the notice (being not less than 14 days from the date of the service of the notice) and where the default shares represent at least 0.25 per cent. of their class, sanctions shall apply unless the Directors determine otherwise. The sanctions available are the suspension of the right to attend or vote (whether in person or by representative or proxy) at any general meeting or any separate meeting of the holders of any class or on any poll and, where the default shares represent at least 0.25 per cent. of their class (excluding treasury shares), the withholding of any dividend payable in respect of those shares and the restriction of the transfer of those shares.

In addition to the right to serve a Section 793 notice, the Board has the right under the Articles to serve notice on any member requiring that member to promptly provide the Company with any information, representations, certificates, waivers or forms relating to such member that the Board determines from time to time necessary or appropriate for the Company to have in order to (a) satisfy any diligence requirements and any reporting requirements imposed under or in relation to FATCA or the requirements of any similar laws or regulations to which the Company may be subject enacted from time to time by any other jurisdiction, (b) avoid or reduce any tax otherwise imposed by FATCA or other applicable laws or (c) permit the Company to enter into, comply with, or prevent a default under or termination of, an agreement of the type described in section 1471(b) of U.S. Internal Revenue Code of 1986 or under any other applicable laws. The Company shall be entitled to process such information that it receives from its members for the purposes of carrying out the business of the Company and the administration and protection of its interests.

In the event that a member does not supply the requested information within the time frame specified (which shall not be less than 10 business days from the date of notice) then the Board may by notice to such member, declare him to be a Non-Qualified Holder for the purposes of the Articles and declare that the Shares which are held by the member are Prohibited Shares. The Board may also declare a member to be a Non-Qualified Holder and that his shares are Prohibited Shares if in the Board's opinion, the holding or beneficial ownership of any shares in the Company by any person would constitute an 'onerous obligation'. (These onerous obligations under the Articles relate primarily to the status or tax liabilities of the Company).

In the event that a member is deemed a Non-Qualified Holder, the Board can require him either (1) to provide such information as they deem necessary to evidence that he should not be a Non-Qualified Holder and that his shares should not be considered Prohibited Shares or (2) to sell or transfer his Prohibited Shares to a person who is not a Non-Qualified Holder within 21 days of service of a notice of the Board. If a Non-Qualified Holder does not sell or transfer of his shares as instructed, the Board may dispose of his shares as they so determine.

3.10 Untraced Shareholders

Subject to various notice requirements, the Company may sell any of a Shareholder's shares if, during a period of 12 years, at least three dividends on such shares have become payable and no cheque for amounts payable in respect of such shares has been presented and no warrant has been effected and no communication has been received by the Company from the Shareholder or person concerned.

3.11 Appointment of Directors

Unless the Company determines otherwise by ordinary resolution, the Company must have not less than two and not more than 10 Directors.

Subject to the Articles, the Company may by ordinary resolution appoint a person who is willing to act as, and is permitted by law to do so, to be a Director either to fill a vacancy or as an additional Director. The Directors may appoint a person who is willing to act, and is permitted by law to do so, to be a Director, either to fill a vacancy or as an additional Director. A person appointed as a Director by the other Directors is required to retire at the Company's next annual general meeting and shall then be eligible for reappointment.

Subject to the Articles, at each AGM, every Director shall retire from office. A Director who retires at an AGM may, if willing to continue to act, be elected or re-elected at that meeting. If he is elected or re-

elected he is treated as continuing in office throughout. If he or she is not elected or re-elected, he or she shall remain in office until the end of the meeting or (if earlier) when a resolution is passed to appoint someone in his place. In the event that no Directors are re-appointed, then two of the Directors who retired at the AGM shall be deemed to be continuing until such time as a general meeting can be called to appoint further Directors. Which Directors shall continue shall be decided by ordinary resolution.

The office of a Director shall be vacated:

(a) if he resigns his office by giving written notice signed by him sent to or deposited at the Company's registered office or tendered at a meeting of the Board;
(b) if a registered medical practitioner who is treating him gives a written opinion to the Company that he has become mentally or physically incapable of acting as a director and may remain so for more than three months;
(c) he is suffering from mental or physical ill health and the Directors resolve at a meeting of the Directors that his office be vacated;
(d) if he absents himself from meetings of the Board for a consecutive period of six months without permission of the Directors and the Board resolves that his office shall be vacated;
(e) if he becomes bankrupt or applies for an interim order pursuant to section 253 of the Insolvency Act 1986 or enters into any voluntary arrangement with which the definition contained in that section or has an interim receiver appointed under section 286 of the Act;
(f) if he is prohibited by law from being a Director or ceases to be a Director by the Act;
(g) if he is removed from office by written notice signed by all of the other Directors; or
(h) if the Company by ordinary resolution shall declare that he shall cease to be a Director.

3.12 Powers of Directors

The business of the Company shall be managed by the Directors who, subject to the provisions of the Articles and to any directions given by ordinary resolution to take, or refrain from taking, specified action, may exercise all the powers of the Company.

Any Director may appoint any other Director, or any other person approved by resolution of the Directors and willing to act and permitted by law to do so, to be an alternate Director.

3.13 Borrowings

Subject to the Company's published investment policy from time to time, the Board on behalf of the Company may exercise all the powers of the Company to borrow or raise money, to mortgage or charge its undertaking, property, assets and uncalled capital and to issue debentures and other securities, and to give security whether outright or as collateral security for any debt, liability or obligation of the Company or of any third party.

3.14 Voting at board meetings

No business shall be transacted at any meeting of the Directors unless a quorum is present and the quorum may be fixed by the Directors; unless so fixed at any other number the quorum shall be two. A Director shall not be counted in the quorum present in relation to a matter or resolution on which he is not entitled to vote but shall be counted in the quorum present in relation to all other matters or resolutions considered or voted on at the meeting. An alternate Director who is not himself a Director shall, if his appointor is not present, be counted in the quorum.

Questions arising at a meeting of the Directors shall be decided by a majority of votes. In the case of an equality of votes, the chairman of the meeting shall have a second or casting vote.

3.15 Restrictions on voting

Subject to any other provision of the Articles, a Director shall not vote at a meeting of the Directors on any resolution concerning a matter in which he has, directly or indirectly, a material interest (other than

101

an interest in shares, debentures or other securities of, or otherwise in or through, the Company) unless his interest arises only because the case falls within certain limited categories specified in the Articles.

3.16 Directors' interests

Subject to the provisions of the Statutes and provided that the Director has disclosed to the other Directors the nature of any interest of his, a Director, notwithstanding his office, may be a party to, or otherwise interested in, any transaction or arrangement with the Company or in which the Company is otherwise interested and may be a director or other officer of, or employed by, or a party to any transaction or arrangement with, or otherwise interested in, any body corporate in which the Company is interested.

3.17 Indemnity

Subject to the provisions of the Statutes, the Company may indemnify any person who is a director, alternate director, former director, secretary or other officer of the Company (other than an auditor), against any liability whether in connection with any negligence, default, breach of duty or breach of trust by him in relation to anything done or omitted to be done or alleged to have been done or omitted to be done by him as a director of the Company or any associated company. The Directors may purchase and maintain, at the cost of the Company, insurance for any person who is a director, alternate director, former director, secretary, or other officer of the Company or an associated company in relation to anything done or omitted to be done or alleged to have been done or omitted to be done as director, alternate director, secretary or officer.

3.18 General meetings

In the case of the annual general meeting, 21 clear days' notice at the least shall be given to all the members and to the auditors. All other general meetings shall also be convened by not less than 14 clear days' notice in writing to all the members.

No business other than the appointment of the chairman of the meeting shall be transacted at any meeting unless a quorum is present. One person where there is only a single member of the Company and two persons where there is more than one member of the Company entitled to vote upon the business to be transacted, each being a Shareholder or a proxy for a Shareholder or a duly authorised representative of a corporation which is a Shareholder, shall be a quorum.

A Shareholder is entitled to appoint another person as his proxy to exercise all or any of his rights to attend and to speak and vote at a meeting of the Company (provided such notice of proxy is made in writing). A Shareholder may appoint more than one proxy in relation to a meeting, provided that each proxy is appointed to exercise the rights attached to a different share or shares held by him. Subject to the provisions of the Act, any corporation (other than the Company itself) which is a Shareholder may, by resolution of its directors or other governing body, authorise such person(s) to act as its representative(s) at any meeting of the Company, or at any separate meeting of the holders of any class of shares.

Delivery of an appointment of proxy shall not prevent a Shareholder from attending and voting at the meeting or at any adjournment of it.

Directors may attend and speak at general meetings and at any separate meeting of the holders of any class of shares, whether or not they are Shareholders.

A poll on a resolution may be demanded at a general meeting before or on the declaration of the result of the show of hands by the chairmen or those members entitled under the Act to demand a poll.

3.19 C Shares and Deferred Shares

The rights and restrictions attaching to the C Shares and the Deferred Shares arising on their conversion are summarised below.

(a) The following definitions apply for the purposes of this paragraph 3.19 only: "Calculation Date" means in relation to any tranche of C Shares the earliest of the:

(i) close of business on the date to be determined by the Directors occurring not more than 10 Business Days after the day on which the Investment Adviser shall have given notice to

102

the Directors that at least 90 per cent. of the proceeds of the Issue (or such other percentage as the Directors and the AIFM may agree) shall have been invested; or

(ii) close of business on the date falling 9 calendar months after the allotment of the C Shares or if such a date is not a Business Day the next following Business Day; or
(iii) close of business on the day on which the Directors resolve that Force Majeure Circumstances have arisen or are imminent;

"Conversion" means conversion of any tranche of C Shares into Ordinary Shares and Deferred Shares in accordance with paragraph (g);

"Conversion Date" means in relation to any tranche of C Shares the close of business on such Business Day as may be selected by the Directors falling not more than 10 Business Days after the Calculation Date of such tranche of C Shares;

"Conversion Ratio" is the ratio of the net asset value per C Share to the net asset value per Ordinary Share, which is calculated as:

$$
\text{Conversion Ratio} = \frac{A}{B}
$$

$$
A = \frac{C - D}{E}
$$

$$
B = \frac{F - C - I - G + D + J}{H}
$$

Where:

C is the aggregate of:

(i) the value of the investments of the Company attributable to the C Shares of the relevant tranche, calculated as at the Calculation Date in accordance with the valuation policy adopted by the Company from time to time; and
(ii) the amount which, in the Directors' opinion, fairly reflects, on the Calculation Date, the value of the current assets of the Company attributable to the relevant tranche of C Shares (excluding the investments valued under (i) above but including cash and deposits with or balances at a bank and including any accrued income less accrued expenses and other items of a revenue nature), calculated in accordance with the valuation policy adopted by the Company from time to time;

D is the amount (to the extent not otherwise deducted from the assets attributable to the relevant tranche of C Shares) which, in the Directors' opinion, fairly reflects the amount of the liabilities of the Company attributable to the relevant tranche of C Shares on the Calculation Date (including the amounts of any declared but unpaid dividends in respect of such Shares);

E is the number of C Shares of the relevant tranche in issue on the Calculation Date;

F is the aggregate of:

(i) the value of all the investments of the Company, as at the Calculation Date in accordance with the valuation policy adopted by the Company from time to time; and
(ii) the amount which, in the Directors' opinion, fairly reflects, on the Calculation Date, the value of the current assets of the Company (excluding the investments valued under (i) above but including cash and deposits with or balances at a bank and including any accrued income less accrued expenses and other items of a revenue nature), calculated in accordance with the valuation policy adopted by the Company from time to time;

G is the amount (to the extent not otherwise deducted in the calculation of F) which, in the Directors' opinion, fairly reflects the amount of the liabilities of the Company on the Calculation Date (including the amounts of any declared but unpaid dividends);

103

H is the number of Ordinary Shares in issue on the Calculation Date (excluding any Ordinary Shares held in treasury);

I is the aggregate of:

(i) the value of the investments of the Company attributable to all other tranches of C Shares in issue other than the tranche of C Shares as referred to in C above (the “Other Tranches of C Shares”), calculated as at the Calculation Date in accordance with any valuation policy adopted by the Company from time to time; and

(ii) the amount which, the Directors’ opinion, fairly reflect, on the Calculation Date, the value of the current assets of the Company attributable to the Other Tranches of C Shares (excluding the investments valued under (i) above but including cash and deposits with or balances at a bank and including any accrued income less accrued expenses and other items of a revenue nature), calculated in accordance with any valuation policy adopted by the Company from time to time; and

J is the amount (to the extent not otherwise deducted from the assets attributable to the Other Class(es) of C Shares) which, in the Directors’ opinion, fairly reflects the amount of the liabilities of the Company attributable to the Other Class(es) of C Shares on the Calculation Date,

provided that the Directors shall make such adjustments to the value or amount of A and B as either the auditors shall report to be appropriate or in the event that the auditors are unwilling to act, as the Directors consider appropriate, in either case having regard among other things, to the assets of the Company immediately prior to the date on which the Company first receives the Net Proceeds relating to the relevant class of C Shares and/or to the reasons for the issue of the relevant class of C Shares;

Deferred Shares means deferred shares of £0.01 each in the capital of the Company and having the rights and being subject to the restrictions set out in the Articles arising on Conversion;

Existing Ordinary Shares means the Ordinary Shares in issue immediately prior to Conversion;

Force Majeure Circumstances means (i) any political and/or economic circumstances and/or actual or anticipated changes in fiscal or other legislation which, in the reasonable opinion of the Directors, renders Conversion necessary or desirable; (ii) the issue of any proceedings challenging, or seeking to challenge, the power of the Company and/or its Directors to issue the C Shares of the relevant tranche with the rights proposed to be attached to them and/or to the persons to whom they are, and/or the terms upon which they are proposed to be issued; or (iii) the giving of notice of any general meeting of the Company at which a resolution is to be proposed to wind up the Company, whichever shall happen earliest; and

Net Proceeds means the net cash proceeds of the issue of the C Shares (after deduction of those commissions and expenses relating thereto and payable by the Company).

References to ordinary shareholders, C Shareholders and deferred shareholders should be construed as references to holders for the time being of Ordinary Shares, C Shares and Deferred Shares respectively.

(b) The holders of the Ordinary Shares, the Redeemable Preference Shares, the C Shares and the Deferred Shares shall, if issued, subject to the provisions of the Articles, have the following rights to be paid dividends:

(i) the Deferred Shares (to the extent that any are in issue and extant) shall entitle the holders thereof to a cumulative annual dividend at a fixed rate of one per cent. of the nominal amount thereof, the first such dividend (adjusted pro rata temporis) (the “Deferred Dividend”) being payable on the date six months after the Conversion Date on which such Deferred Shares were created (the “Relevant Conversion Date”) and on each anniversary of such date payable to the holders thereof on the register of members on that date as holders of Deferred Shares but shall confer no other right, save as provided herein, on the holders thereof to share in the profits of the Company. The Deferred Dividend shall not accrue or become payable in any way until the date six months after the Conversion Date and shall then only be payable to those holders of Deferred Shares registered in the register of members of the Company as holders of Deferred Shares on that date. It should be noted

104

that given the proposed repurchase of the Deferred Shares as described below, it is not expected that any dividends will accrue or be paid on such shares;

(ii) the holders of any tranche of C Shares shall be entitled to receive in that capacity such dividends as the Directors may resolve to pay out of net assets attributable to that tranche of C Shares and from income received and accrued which is attributable to that tranche of C Shares;

(iii) a holder of Redeemable Preference Shares shall be entitled (in priority to any payment of dividend on any other class of share) to a fixed cumulative preferential dividend of 0.01 per cent. per annum on the nominal amount of the Redeemable Preference Shares held by him, such dividend to accrue annually and to be payable in respect of each accounting reference period of the Company within 21 days of the end of such period. Such dividend will be payable in priority to the payment of a dividend to the holders of any other class of shares but, for so long as there are shares of any other class in issue, the Redeemable Preference Shares shall not confer any further right to participate in the profits of the Company;

(iv) the Ordinary Shares shall confer the right to dividends declared in accordance with the Articles out of the assets attributable to, and the profits available for distribution which are attributable to, the Ordinary Shares;

(v) the Ordinary Shares into which C Shares shall convert shall rank pari passu with the Existing Ordinary Shares for dividends and other distributions made or declared by reference to a record date falling after the Calculation Date; and

(vi) no dividend or other distribution shall be made or paid by the Company on any of its shares (other than any Deferred Shares for the time being in issue) between the Calculation Date and the Conversion Date relating to any tranche of C Shares (both dates inclusive) and no such dividend shall be declared with a record date falling between the Calculation Date and the Conversion Date (both dates inclusive).

(c) The holders of the Ordinary Shares, the Redeemable Preference Shares, the C Shares and the Deferred Shares shall, subject to the provisions of the Articles, have the following rights as to capital:

(i) the surplus capital and assets of the Company shall on a winding-up or on a return of capital (otherwise than on a purchase by the Company of any of its shares) at a time when any C Shares are for the time being in issue and prior to the Conversion Date relating to such C Shares, be applied as follows:

A. first, an amount equivalent to (C-D) in respect of each tranche of C Shares in issue using the methods of calculation of C and D given in the definition of Conversion Ratio set out above save that the "Calculation Date" shall be such date as the liquidator may determine, which amount attributable to each class shall be applied amongst the C Shareholders of the relevant tranche pro rata according to the nominal capital paid up on their holdings of C Shares,

B. second, amongst the Redeemable Preference Shareholders pro rata according to the nominal capital paid up on their holdings of Redeemable Preference Shares;

C. third, if there are any Deferred Shares in issue, in paying to the holders of the Deferred Shares one pence in aggregate in respect of every one million Deferred Shares (or part thereof) of which they are the respective holders; and

D. fourth amongst the existing Ordinary Shareholders pro rata according to the nominal capital paid up on their holdings of Existing Ordinary Shares

provided however that the holders of the Redeemable Preference Shares shall only receive an amount up to the capital paid up on such Redeemable Preference Shares and the Redeemable Preference Shares shall confer the right to participate in any surplus remaining following payment of such amount; and

105

(ii) the surplus capital and assets of the Company shall on a winding-up or on a return of capital (otherwise than on a purchase by the Company of any of its shares) at a time when no tranche of C Shares is for the time being in issue be applied as follows:

A. first, the surplus shall be divided, first, amongst the holders of Redeemable Preference Shares pro rata according to the nominal capital paid up on their holdings of Redeemable Preference Shares

B. second, if there are Deferred Shares in issue, in paying to the deferred shareholders £0.01 in aggregate in respect of every 1,000,000 Deferred Shares (or part thereof) of which they are respectively the holders; and

C. third, amongst the Ordinary Shareholders pro rata according to the nominal capital paid up on their holdings of Ordinary Shares

provided always, however that the holders of the Redeemable Preference Shares shall only receive an amount up to the capital paid up on such Redeemable Preference Shares and neither the Redeemable Preference Shares nor the Deferred Shares shall not confer the right to participate in any surplus remaining following payment of such amount.

(d) As regards voting:

(i) The Ordinary Shares and each tranche of C Shares shall carry the right to receive notice of and to attend and vote at any general meeting of the Company. The voting rights of holders of any tranche of C Shares will be the same as those applying to holders of Existing Ordinary Shares as set out in the Articles as if the C Shares and Existing Ordinary Shares were a single class.

(ii) For so long as there are shares of any other class in issue, the holders of the Redeemable Preference Shares shall have no right to receive notice of, or vote at, any general meeting of the Company. If there are no shares of any other class in issue, the holders of the Redeemable Preference Shares shall be entitled to receive notice of, and vote at, any general meeting of the Company and each holder of Redeemable Preference Shares who is present in person, or, if a corporation, by representative (or in either case, by proxy) at a general meeting shall, have one vote on a show of hands and shall have no vote in respect of each Redeemable Preference Share held by him on a poll.

(iii) The Deferred Shares shall not carry any right to receive notice of nor to attend or vote at any general meeting of the Company.

(e) The following shall apply to the Deferred Shares:

(i) the C Shares of any tranche shall be issued on such terms that the Deferred Shares arising upon Conversion (but not the Ordinary Shares arising on Conversion) may be repurchased by the Company in accordance with the terms set out in the Articles;

(ii) subject to the Company having sufficient distributable reserves and the Conversion occurring on a date which is not more than five years after the date of incorporation of the Company, immediately upon Conversion, the Company shall repurchase all of the Deferred Shares which arise as a result of Conversion for an aggregate consideration of £0.01 for every 1,000,000 Deferred Shares and the notice referred to in paragraph (g) (b) below shall be deemed to constitute notice to each C Shareholder (and any person or persons having rights to acquire or acquiring C Shares on or after the Calculation Date) that the Deferred Shares shall be repurchased immediately upon Conversion for an aggregate consideration of £0.01 for each holding of 1,000,000 Deferred Shares. On repurchase, each Deferred Share shall be treated as cancelled in accordance with section 706 of the Act without further resolution or consent. In the event of any Deferred Shares arising on a Conversion which occurs on or after the fifth anniversary of the incorporation of the Company, the Deferred Shares shall not be repurchased unless and until the Company has, in general meeting, approved the buyback of such Deferred Shares in accordance with the Act; and

106

(iii) the Company shall not be obliged to: (i) issue share certificates to the deferred shareholders in respect of the Deferred Shares; or (ii) account to any deferred shareholder for the repurchase monies in respect of such Deferred Shares.

(f) If there are in issue at the same time C Shares carrying different rights, each shall be deemed to be a separate class of shares. The Directors may, if they so decide, designate each Class of C Shares in such manner as they see fit in order that each class of C Shares can be separately identified. For so long as any tranche of C Shares are for the time being in issue, until the Conversion of such tranche of C Shares and without prejudice to its obligations under applicable laws the Company shall:

(i) procure that the Company's records, bank and custody accounts shall be operated so that the assets attributable to the C Shares of that tranche can, at all times, be separately identified and, in particular but without prejudice to the generality of the foregoing, the Company shall, without prejudice to any obligations pursuant to applicable laws, procure that separate cash accounts, broker settlement accounts and investment ledger accounts shall be created and maintained in the books of the Company for the assets attributable to each tranche of C Shares in issue;

(ii) allocate to the assets attributable to the C Shares of that tranche such proportion of the income, expenses and liabilities of the Company incurred or accrued between the date on which the Company first receives the Net Proceeds and the Calculation Date relating to such tranche of C Shares (both dates inclusive) as the Directors consider to be attributable to the C Shares; and

(iii) give or procure the giving of appropriate instructions to the AIFM to manage the Company's assets so that such undertakings can be complied with by the Company.

(g) A tranche of C Shares for the time being in issue shall be sub-divided and converted into Ordinary Shares and Deferred Shares on the Conversion Date in accordance with the following provisions of this paragraph (g):

(i) the Directors shall procure that as soon as reasonably practicable and in any event within one month of the Calculation Date:

A. the Conversion Ratio as at the Calculation Date and the numbers of Ordinary Shares and Deferred Shares to which each C Shareholder shall be entitled on Conversion shall be calculated; and

B. the auditors shall be requested to confirm that such calculations as have been made by the Company have, in their opinion, been performed in accordance with the Articles and are arithmetically accurate whereupon such calculations shall become final and binding on the Company and all holders of the Company's shares and any other securities issued by the Company which are convertible into the Company's shares, subject to the proviso immediately after the definition of J in paragraph (a).

(ii) The Directors shall procure that, as soon as practicable following such confirmation and in any event within one month of the Calculation Date, a notice is sent to each C Shareholder advising such C Shareholder of the Conversion Date, the Conversion Ratio and the numbers of Ordinary Shares and Deferred Shares to which such C Shareholder will be entitled on Conversion.

(iii) On conversion each C Share shall automatically subdivide into 10 conversion shares of £0.01 each and such conversion shares of £0.01 each shall automatically convert into such number of Ordinary Shares and Deferred Shares as shall be necessary to ensure that, upon such Conversion being completed:

A. the aggregate number of Ordinary Shares into which the same number of conversion shares of £0.01 each are converted equals the number of C Shares of the relevant tranche in issue on the Calculation Date multiplied by the Conversion Ratio (rounded down to the nearest whole Ordinary Share); and

B. each conversion share of £0.01 which does not so convert into an Ordinary Share shall convert into one Deferred Share.

107

(iv) The Ordinary Shares and Deferred Shares arising upon Conversion shall be divided amongst the former C Shareholders pro rata according to their respective former holdings of C Shares of the relevant tranche (provided always that the Directors may deal in such manner as they think fit with fractional entitlements to Ordinary Shares and Deferred Shares arising upon Conversion including, without prejudice to the generality of the foregoing, selling any Ordinary Shares representing such fractional entitlements and retaining the proceeds for the benefit of the Company).

(v) Forthwith upon Conversion, the share certificates relating to the C Shares shall be cancelled and the Company shall issue to each former C Shareholder new certificates in respect of the Ordinary Shares which have arisen upon Conversion to which he is entitled. Share certificates in respect of the Deferred Shares will not be issued.

(vi) The Directors may make such adjustments to the terms and timing of Conversion as they in their discretion consider are fair and reasonable having regard to the interests of all Shareholders.

(h) Without prejudice to the generality of the Articles, for so long as any tranche of C Shares are for the time being in issue it shall be a special right attaching to the Existing Ordinary Shares as a class and to that tranche of C Shares as a separate class that without the sanction or consent of such holders given in accordance with the Company's Articles:

(i) no alteration shall be made to the Articles;

(ii) no allotment or issue will be made of any security convertible into or carrying a right to subscribe for any share capital of the Company other than the allotment or issue of further C Shares; and

(iii) no resolution of the Company shall be passed to wind-up the Company.

(i) For the avoidance of doubt but subject to the rights or privileges attached to any other class of shares, the previous sanction of a special resolution of the holders of Existing Ordinary Shares and any tranche of C Shares, as described above, shall not be required in respect of: (i) the issue of further Ordinary Shares ranking pari passu in all respects with the Existing Ordinary Shares (otherwise than in respect of any dividend or other distribution declared, paid or made on the Existing Ordinary Shares by the issue of such further Ordinary Shares); or (ii) the sale of any shares held as treasury shares (as such term is defined in section 724 of the Act) in accordance with sections 727 and 731 of the Act or the purchase or redemption of any shares by the Company (whether or not such shares are to be held in treasury).

(j) The Company may by notice in writing and upon tendering to a registered holder of Redeemable Preference Shares the amount of capital paid up thereon, redeem any Redeemable Preference Shares at any time (subject to the provisions of the Acts) and such holder shall be bound to deliver up any certificate which may have been representing the same. Upon redemption, the name of the registered holder shall be removed from the Register. Each Redeemable Preference Share which is redeemed shall thereafter be cancelled. None of the Ordinary Shares or the C Shares shall be redeemable by the Company.

3.20 Duration

The Directors shall procure that there is proposed at the annual general of the Company to be held in 2025 and at every second annual general meeting of the Company thereafter an ordinary resolution providing that the Company should continue as an investment trust for a further period of two years. If any such resolution is not put forward or is defeated, the Directors shall be obliged to draw up proposals for the voluntary liquidation, unitisation, reorganisation or other reconstruction of the Company for submission to the Shareholders at a general meeting convened for a date not later than six months after the above mentioned annual general meeting. Implementation of any such proposals shall require the approval of the Shareholders by ordinary resolution.

4. The Takeover Code

4.1 Mandatory bid

The Takeover Code applies to the Company. Under Rule 9 of the Takeover Code, if:

(a) a person acquires an interest in shares which, when taken together with shares already held by him or persons acting in concert with him, carry 30 per cent. or more of the voting rights in the Company; or
(b) a person who, together with persons acting in concert with him, is interested in not less than 30 per cent. and not more than 50 per cent. of the voting rights in the Company acquires additional interests in shares which increase the percentage of shares carrying voting rights in which that person is interested,

the acquirer and, depending on the circumstances, its concert parties, would be required (except with the consent of the Panel) to make a cash offer for the outstanding shares at a price not less than the highest price paid for any interests in the shares by the acquirer or its concert parties during the previous 12 months.

The Rosenwald Associates hold in excess of 30 per cent. of the issued Ordinary Shares. Further details regarding individual members of the Rosenwald Associates and their potential shareholding on Admission is set out in paragraph 4.2 below.

At the time of the Company's IPO, the Takeover Panel confirmed to the Company that no mandatory offer for the Company would need to be made as a result of the Rosenwald Associates acquiring 30 per cent. or up to a maximum of 49.9 per cent. of the voting rights attached to the issued share capital of the Company as a result of the IPO on the basis that the participation by the Rosenwald Associates in the IPO and the maximum controlling interest that the Rosenwald Associates concert party could have as a result of the IPO were disclosed in the IPO Prospectus.

Neither James B. Rosenwald, III nor any other member of the Rosenwald Associates will be able to increase their aggregate percentage interest in the Company (in connection with the Issue, the Placing Programme or otherwise) without triggering the requirement to make a cash offer for the outstanding Shares in the Company at the highest price paid by any of the Rosenwald Associates in the preceding 12 months, as provided for in Rule 9 of the Takeover Code.

If the Rosenwald Associates' aggregate percentage interest in the Company's voting interests is diluted as a result of the Issue, the Placing Programme or otherwise, the thresholds set out in paragraph 4.1 will apply to any future acquisitions of Shares by the Rosenwald Associates.

4.2 The Rosenwald Associates Concert Party

The following investors, defined as the "Rosenwald Associates", are regarded as acting in concert for the purposes of the Takeover Code:

(a) James B. Rosenwald, III (together with his family and related trusts);
(b) Gifford Combs (together with his related trust);
(c) Paul ffolkes Davis;
(d) Rosenwald Clients;
(e) Rising Sun; and
(f) Shore Capital.

The Rising Sun Management Team includes six key individuals, two of whom are shareholders in the Company, namely James B. Rosenwald, III and Paul ffolkes Davis (in each case together with their family and related trusts, associates and/or connected persons). They are considered to be acting in concert with each other because they are among the principals of the Investment Adviser. Details of the Investment Adviser and the biographies of these individuals is set out in Part 7 (Directors, Management and Administration) of the Prospectus.

James B. Rosenwald, III is a Portfolio Manager at Dalton and the President of Dalton's managing member, Rosenwald Capital. Dalton and Rosenwald Capital are the investment managers for the Rosenwald Clients. Accordingly, the Rosenwald Clients will be presumed to be acting in concert with James B. Rosenwald, III in relation to any interest acquired in the Company by the Rosenwald Clients (in each case either

109

directly or through a custodian or nominee). As a result, the Rosenwald Clients are members of the Rosenwald Associates concert party.

James B. Rosenwald, III is a director of certain companies in Shore Capital's group and sits on its board and Shore Capital is therefore considered to be acting in concert with him.

Each of the Directors are considered to be independent of James B. Rosenwald, III and are therefore considered not to be acting in concert with James B. Rosenwald, III or any other member of the Rosenwald Associates concert party.

4.3 Share Buyback Authorisations

When a company redeems or purchases its own voting shares, under Rule 37 of the Takeover Code, any resulting increase in the percentage of shares carrying voting rights in which a person or group of persons acting in concert is interested will be treated as an acquisition for the purpose of Rule 9 of the Takeover Code. Rule 37 of the Takeover Code provides that, subject to prior consultation, the Panel will normally waive any resulting obligation to make a general offer if there is a vote of independent shareholders and a procedure along the lines of that set out in Appendix 1 to the Takeover Code is followed. Appendix 1 to the Takeover Code sets out the procedure which should be followed in obtaining the consent of independent shareholders. Under Note 1 on Rule 37.1 of the Takeover Code, a person who comes to exceed the limits in Rule 9.1 in consequence of a company's purchase of its own shares will not normally incur an obligation to make a mandatory offer unless that person is a director, or the relationship of the person with any one or more of the directors is such that the person is, or is presumed to be, acting in concert with any of the directors. The investment manager of an investment trust is treated for these purposes as if it were a director. Since Rising Sun is the Investment Adviser and James B. Rosenwald, III, Gifford Combs and Paul ffolkes Davis are principals of the Investment Adviser, the exception under Note 1 of Rule 37.1 of the Takeover Code will not apply to these persons.

The Company is currently authorised to make market purchases of up to 14.99 per cent. of the aggregate number of issued Ordinary Shares as at the date of this Prospectus. Subject to the passing of the Share Buyback Resolution, the Company will be authorised to make market purchases of up to 14.99 per cent. of the aggregate number of issued C Shares immediately following First Admission. If the Company were to exercise any such authority authority then the shareholding of the Rosenwald Associates could increase, resulting in an increase in the percentage of voting interests held by the Rosenwald Associates.

4.4 Compulsory acquisition

Under sections 974 to 991 of the Act, if an offeror acquires or contracts to acquire (pursuant to a takeover offer) not less than 90 per cent. of the shares (in value and by voting rights) to which such offer relates it may then compulsorily acquire the outstanding shares not assented to the offer. It would do so by sending a notice to outstanding holders of shares telling them that it will compulsorily acquire their shares and then, six weeks later, it would execute a transfer of the outstanding shares in its favour and pay the consideration to the Company, which would hold the consideration on trust for the outstanding holders of shares. The consideration offered to the holders whose shares are compulsorily acquired under the Act must, in general, be the same as the consideration that was available under the takeover offer.

In addition, pursuant to section 983 of the Act, if an offeror acquires or agrees to acquire not less than 90 per cent. of the shares (in value and by voting rights) to which the offer relates, any holder of shares to which the offer relates who has not accepted the offer may require the offeror to acquire his shares on the same terms as the takeover offer.

The offeror would be required to give any holder of shares notice of his right to be bought out within one month of that right arising. Sell-out rights cannot be exercised after the end of the period of three months from the last date on which the offer can be accepted or, if later, three months from the date on which the notice is served on the holder of shares notifying them of their sell-out rights. If a holder of shares exercises its rights, the offeror is bound to acquire those shares on the terms of the takeover offer or on such other terms as may be agreed.

110

111

4.5 Prohibition on frustrating actions

Pursuant to Rule 21.1 of the Takeover Code, where the offeree board has received an approach or has reason to believe an offer might be imminent, the board of the offeree company must not, without shareholder consent first being obtained in general meeting:

(a) take any action which may result in any offer or bona fide possible offer being frustrated; or the shareholders of the offeree company being denied the opportunity to decide on the merits of any offer or bona fide possible offer; or

(b) amongst other matters, issue any shares, or issue or grant any options in respect of unissued shares, or create any securities carrying rights of conversion into shares, or sell or dispose of any asset of a material amount, or enter into contracts otherwise than in the ordinary course of business.

5. Interests of Directors, major shareholders and related party transactions

5.1 Directors' interests

(a) Save as disclosed in the table below, immediately following First Admission, no Director will have any interest, whether beneficial or non-beneficial, in the share or loan capital of the Company.

(b) The interests (all of which are or will be beneficial unless otherwise stated) of the Directors (together with their connected persons) in the share capital of the Company are as follows:

Director	Ordinary Shares	Percentage of issued share capital
Rosemary Morgan	40,000	0.04
Chetan Ghosh	40,000	0.04
Rachel Hill	80,000	0.08
Alicia Ogawa	25,000	0.02
Ayako Weissman	27,000	0.03

(c) No Director of the Company has or has had any interest in any transaction which is or was unusual in its nature or conditions or significant to the business of the Company which was effected by the Company since its incorporation.

(d) No share or loan capital of the Company is under option or is agreed conditionally or unconditionally to be put under option.

(e) There are no outstanding loans granted by the Company to any of the Directors nor is any guarantee provided by the Company for the benefit of any of the Directors.

5.2 Directors' contracts with the Company

All the Directors of the Company are non-executive and are engaged under a letter of appointment. It is the Board's policy that none of the Directors has a service contract. The terms of their appointment provide that a Director may be removed without notice in certain circumstances (including upon a failure to be re-elected at the Company's annual general meeting) and that no compensation will be due on leaving office.

The Directors are entitled to aggregate annual remuneration (including any contingent or deferred compensation but excluding expenses) payable and benefits in kind granted as follows:

Director	Fees
Rosemary Morgan	£35,000
Chetan Ghosh	£30,000
Rachel Hill	£27,000
Alicia Ogawa	£27,000
Ayako Weissman	£27,000
Total	£146,000

The aggregate amount of remuneration (including any contingent or deferred compensation but excluding expenses) payable and benefits in kind granted to the Directors for the financial period from the Company's incorporation on 22 October 2019 until 31 December 2020 was approximately £168,900.

The Directors are not eligible for bonuses, pension benefits, share options, long-term incentive schemes or other benefits. There is no amount set aside or accrued by the Company in respect of contingent or deferred compensation payments or any benefits in kind payable to the Directors. The Directors shall however, be entitled to remuneration for any additional services provided by them which are beyond the scope of the services required pursuant to the terms of their letter of appointment, subject always to any overall cap on Directors' remuneration set out in the Articles.

The Articles specify that any new Directors appointed during the year must stand for election at the first annual general meeting following their appointment. Thereafter, each of the Directors is obliged to retire and if they wish, offer themselves for re-election annually.

Each Director was appointed in 2019, and each director therefore stood for election (and was elected as a director of the Company by shareholders) at the Company's first Annual General Meeting on 12 May 2021.

5.3 Directors' other interests

Over the five years preceding the date hereof, the Directors have held the following directorships (apart from their directorships of the Company) and/or partnerships:

	Current directorships/partnerships	Past directorships/partnerships
Rosemary Morgan	Schroder AsiaPacific Fund plc
JPMorgan Indian Investment Trust plc	Landau Forte Charitable Trust
The London Library Pension Trustee Limited
Chetan Ghosh	None	None
Rachel Hill	Dragon Capital Markets (Europe)
Limited
DC Developing Market Strategies PLC
Quaero Capital Funds (Lux)	Dalton Asia (Offshore Feeder) Fund Ltd.
Talos Investment Fund SICAV
Alicia Ogawa	Misaki Engagement Fund
Misaki Engagement Fund II	None
Ayako Weissman	Toshiba Corporation	SBI Holdings, Inc

Alicia Ogawa is currently a director of two funds operated by Misaki Capital Inc. Misaki Capital Inc. has an investment policy of investing in small cap Japanese companies and aims to achieve returns by working collaboratively with management to improve the business and therefore achieve value appreciation. Mrs Ogawa's principal responsibility for these funds is to oversee compliance and regulatory policies and she has no role in day-to-day investment decisions. Therefore, it is not anticipated that Mrs Ogawa's position as a director of Misaki Engagement Fund and Misaki Engagement Fund II will create a conflict of interest with her office as a Director.

Other than as discussed above, as at the date of this Prospectus there are no potential conflicts of interest between any of the Directors' duties to the Company and their private interests and/or other duties.

5.4 The Directors in the five years before the date of this Prospectus:

(a) do not have any convictions in relation to fraudulent offences;

(b) have not been associated with any bankruptcies, receiverships or liquidations of any partnership or company through acting in the capacity as a member of the administrative, management or supervisory body or as a partner, founder or senior manager of such partnership or company; and

(c) do not have any official public incrimination and/or sanctions by statutory or regulatory authorities (including designated professional bodies) and have not been disqualified by a court from acting as a member of the administrative, management or supervisory bodies of any issuer or from acting in the management or conduct of the affairs of any issuer.

112

The Company maintains directors' and officers' liability insurance on behalf of the Company at the expense of the Company.

5.5 Major Shareholders

Shareholder	Ordinary Shares	Percentage of issued share capital
Rosenwald Clients	41,560,001	40.35%

Rosenwald Capital Management, Inc., Dalton Investments LLC, Dalton Investments Inc. and their affiliates and their advisory clients (together, the "Rosenwald Clients") hold 40.35 per cent. of the voting rights in the Company. Rosenwald Clients are therefore able to exercise control over the Company to the extent that it is able to prevent special resolutions of the Company, which require a 75 per cent. majority to pass, from being passed. Although the Rosenwald Clients do not possess sufficient voting control to pass ordinary resolutions of the Company (which require a simple majority to pass) on its own, the Rosenwald Clients' position on the passing (or not) of ordinary resolutions is likely to have a significant bearing on whether such resolutions are passed.

It is expected that the Rosenwald Clients will not participate in the Issue and that therefore their interests in the Company will be diluted to 16.43 per cent. of the total issued share capital of the Company (assuming that 150 million Ordinary Shares are issued pursuant to the Issue). If that were to occur then Rosenwald alone would not be able to prevent special resolutions being passed, but would still possess significant influence over the passing (or not) of ordinary and special resolutions. In the event that the Company issues C Shares pursuant to the Issue, voting rights of the Rosenwald Clients would be diluted to 16.43 per cent. (assuming that 150 million C Shares are issued pursuant to the Issue). There will be no dilution of the Rosenwald Client's holding of Ordinary Shares until the conversion of those C Shares into Ordinary Shares. The dilution of the Rosenwald Client's holding at that point will be determined by the conversion ratio applied at that time.

Major shareholders do not have any different voting rights from other shareholders.

5.6 Related party transactions

As at the date of this Prospectus, save for the Directors' appointment letters, the Investment Advisory Agreement, the Company is not a party to, nor has any interest in, any related party transaction.

6. Material contracts

The following is a summary of each material contract, other than contracts entered into in the ordinary course of business, to which the Company is a party or which contains any provision under which the Company has any obligation or entitlement which is material to it at the date of this Prospectus.

6.1 Facility agreement

The Company and The Northern Trust Company, London Branch ("NT") entered into an overdraft facility agreement dated 19 August 2021, pursuant to which NT has made available a £20 million facility which the Company intends to use to support its investment objective. The key terms of the facility are as follows:

(a) the Company may not drawdown an amount under the facility agreement that exceeds 20 per cent. of the assets held by the Company, excluding any single asset that comprises more than 10 per cent. of the Company's net asset value;

(b) the facility agreement has no set termination date and is repayable on demand;

(c) interest on amounts drawn down in sterling shall be payable at a rate per annum equivalent to the Bank of England base rate, subject to a floor of 0, plus 1.95 per cent.;

(d) interest on amounts drawn down in Japanese yen shall be payable at a rate per annum equivalent to the Bank of Japan target rate, subject to a floor of 0, plus 1.95 per cent.;

(e) the Company may not take on any other form of indebtedness without NT's consent; and

(f) the facility agreement is governed by the laws of England and Wales.

6.2 Investment Advisory Agreement

The Company, the AIFM and Rising Sun entered into the Investment Advisory Agreement on 7 January 2020, pursuant to which Rising Sun provides investment advisory services to the AIFM and the Company, and shall be entitled to receive from the Company, in respect of the services provided under the Investment Advisory Agreement, a fee as described in further detail below.

A summary of the key terms of the Investment Advisory Agreement is as follows:

(a) the Company may terminate the Investment Advisory Agreement without cause by providing at least 12 months' written notice to Rising Sun, provided that no such notice may be given within the first four years from the IPO Admission Date. The Company may also terminate the Investment Advisory Agreement by giving at least three months' written notice if James B. Rosenwald, III ceases to be engaged by Rising Sun or is otherwise unable to continue his role as head of Rising Sun's investment team and Rising Sun fails to appoint a replacement, satisfactory to the Company, within a period of 60 days;

(b) Rising Sun may terminate the Investment Advisory Agreement without cause by providing at least 12 months' written notice to the AIFM and the Company, provided that no such notice may be given within the first four years from the IPO Admission Date;

(c) the Company and/or the AIFM may terminate the appointment of Rising Sun under the Investment Advisory Agreement with immediate effect for cause (including where Rising Sun has committed a material breach of any obligation of the Investment Advisory Agreement (including the service standards provided for therein) where such breach is capable of remedy and has not been remedied within 60 days, where Rising Sun is guilty of wilful misfeasance, gross negligence or fraud or becomes subject to insolvency proceedings);

(d) Rising Sun may terminate the Investment Advisory Agreement on three months' notice in the event of a change of control of the Company or a material change in the Company's investment policy which has not been approved by Rising Sun;

(e) Rising Sun is entitled, with effect from First Admission, to receive an annual fee to be calculated as 0.85 per cent. of Net Asset Value of the Company, based on the latest available Net Asset Value on the first Business Day of the relevant quarter, exclusive of VAT and paid quarterly in advance. The Company will also reimburse Rising Sun for expenses properly incurred by Rising Sun in the performance of its obligations under the Investment Advisory Agreement however Rising Sun will pay any amounts due to Dalton Advisory KK for the provision of research and data analysis services to Rising Sun;

(f) the Company has also granted Rising Sun and certain other indemnified parties a customary indemnity against losses which may arise in relation to Rising Sun's performance of its duties under the Investment Advisory Agreement;

(g) Rising Sun has agreed to exercise such skill and care in performing and observing its duties and obligation under the Investment Advisory Agreement as could reasonably be expected of a person or firm experienced and skilled in the provision of investment advice relating to acquisition of investments in Japan which are consistent with the Company's investment policy from time to

114

time. In particular, Rising Sun will use commercially reasonable efforts to ensure that it has a suitably qualified senior management team which has appropriate experience; and

(h) the Investment Advisory Agreement is governed by the laws of England and Wales.

6.3 AIFM Agreement

The Company and the AIFM entered into the AIFM Agreement on 7 January 2020, pursuant to which the AIFM was appointed as the alternative investment fund manager to the Company, as defined in the UK AIFM Directive.

A summary of the key terms of the AIFM Agreement is as follows:

(a) International Fund Management Limited is entitled with effect from the IPO Admission Date, to an annual fee calculated at a rate of 0.04 per cent. per annum of Net Asset Value up to £250 million, plus 0.025 per cent. per annum of Net Asset Value in excess of £250 million. The AIFM fee is subject to a minimum fee of £70,000 per annum;

(b) the AIFM is entitled to be reimbursed for out-of-pocket expenses reasonably and properly incurred by it at the request of the Company in the performance of its duties. However, the AIFM will be responsible for the payment of its expenses relating to overhead costs and compensation of its employees;

(c) the AIFM Agreement shall continue in force until terminated by either the AIFM or the Company by giving to the other no less than sixth months' prior written notice, provided that such notice may not be served earlier than the date being 12 months from the date of the AIFM Agreement. The AIFM Agreement may be terminated earlier by either party with immediate effect in certain circumstances, including, if the other party shall go into liquidation or an order shall be made or a resolution shall be passed to put the other party into liquidation or the other party has committed a material breach of any obligation the AIFM Agreement, and in the case of a breach which is capable of remedy fails to remedy it within 30 days;

(d) the AIFM shall maintain, at its cost, professional indemnity insurance to cover any professional liability which it may incur under the AIFM Agreement, with a limit not less than £5,000,000;

(e) the Company has granted to the AIFM and certain other indemnified parties, a customary indemnity against losses which may arise in relation to the AIFM's performance of its duties under the AIFM Agreement; and

(f) the AIFM Agreement is governed by the laws of England and Wales.

6.4 Administration Agreement

The Company is a party to an Administration Agreement with PraxisIFM Fund Services (UK) Limited dated 7 January 2020 pursuant to which the Administrator provides day-to-day administration of the Company and acts as company secretary and administrator to the Company including: company secretarial and administrative services; assistance with the implementation of corporate governance and other compliance requirements; daily calculation of Net Asset Value of the Shares; maintenance of adequate accounting records and management information; preparation of the audited annual financial statements and the unaudited interim report and publication of the same through a Regulatory Information Service; assisting with the preparation and submission of necessary tax returns; and provision of registered office services.

A summary of the key terms of the Administration Agreement is as follows:

(a) the Administrator is entitled to an annual administration fee calculated at a rate of 0.06 per cent. per annum of Net Asset Value up to, and including, £100 million plus 0.035 per cent. per annum of Net Asset Value in excess of £100 million. The administration fee is subject to a minimum fee of £5,000 per month. In respect of its role as company secretary, the Administrator is entitled to receive an annual company secretarial fee of £55,000. All fees are stated exclusive of VAT;

(b) the Administrator may, in addition, be entitled to additional fees in connection with each additional secondary raise (including issues of C Shares);

115

(d) either party may terminate the Administration Agreement on six months' written notice. The agreement is also subject to immediate termination on the occurrence of certain events, including material and continuing breach or insolvency;

(e) the Company has granted to the Administrator and certain other indemnified parties, a customary indemnity against losses which may arise in relation to the Administrator's performance of its duties under the Administration Agreement; and

(f) the Administration Agreement is governed by English law.

6.5 Placing Agreement

In connection with the Initial Placing and any Subsequent Placing, the Company, Rising Sun, Rosenwald Capital and Shore Capital entered into the Placing Agreement on 28 October 2021. The Placing Agreement is conditional on, among other things, First Admission taking place on 25 November 2021 or such later date (not being later than 8:00 a.m. on 31 January 2022) as the Company and Shore Capital may agree.

The principal terms of the Placing Agreement are as follows:

(a) Shore Capital has agreed, as agent of the Company, to use its reasonable endeavours to procure Places to subscribe for Shares under the Initial Placing at the Issue Price and any Subsequent Placing at the relevant Placing Programme Price. The Initial Placing and the Placing Programme are not being underwritten;

(b) provided the Placing Agreement becomes unconditional, Shore Capital shall be entitled to receive a corporate finance fee and a placing commission (each of which will be calculated by reference to the gross proceeds of the Issue and each Subsequent Placing);

(c) Shore Capital shall be reimbursed by the Company for certain of its properly incurred costs and expenses of and incidental to the Issue and related arrangements together with any applicable VAT;

(d) the corporate finance fee, the placing commission and the expenses incurred by Shore Capital in connection with the Issue may be deducted from the placing proceeds received by Shore Capital in respect of the Issue and the Placing Programme;

(e) the Company has given certain warranties to Shore Capital as to the accuracy of the information in this Prospectus and as to other matters relating to the Company. Rising Sun has also given certain warranties to Shore Capital as to certain information in this Prospectus and as to itself. The Company has given an indemnity to Shore Capital in respect of any losses or liabilities arising out of the proper performance by Shore Capital of its duties under the Placing Agreement. Rising Sun has given an indemnity to Shore Capital in respect of its obligations. In addition, the Company and Rising Sun have given an indemnity to Shore Capital in respect of any increased liability of Shore Capital and its affiliates to any third party that would not have arisen had any of the Company or Rising Sun not entered into any agreement or arrangement with any third party adviser in connection with the Issue or the Placing Programme, the terms of which provide that the liability of that adviser to the Company or Rising Sun (as the case may be) is excluded or limited in any manner, and Shore Capital has joint or joint and several liability with such adviser;

(f) Shore Capital may terminate the Placing Agreement (in respect of its own obligations) in certain circumstances, including for a material breach of the warranties referred to above; and

(g) the Placing Agreement is governed by the laws of England and Wales.

6.6 Registrar's Agreement

The Company entered into the Registrar's Agreement on 16 December 2019 with the Registrar whereby the Registrar has agreed to provide registrar services to the Company. The fees payable to the Registrar are based on the number of transactions plus properly incurred expenses, subject to a minimum basic annual registration fee of £4,800. The Registrar's Agreement contains certain standard indemnities from the Company in favour of the Registrar and from the Registrar in favour of the Company. The Registrar's liabilities under the Registrar's Agreement are subject to a financial limit. The Registrar's Agreement is governed by the laws of England and Wales.

116

6.7 Receiving Agent Agreement

The receiving agent agreement is dated 28 October 2021 between the Company and the Receiving Agent whereby the Receiving Agent has agreed to act as Receiving Agent to the Offer for Subscription. The fees payable to the receiving agent are based on the number of applications received and are subject to a minimum fee. The agreement contains certain standard indemnities from the Company in favour of the Receiving Agent and from the Receiving Agent in favour of the Company. The Receiving Agent's liability under the agreement is subject to a financial limit. The Receiving Agent Agreement is governed by the laws of England and Wales.

6.8 Custodian Agreement

The Custodian Agreement is dated 24 December 2019 between the Company and The Northern Trust Company pursuant to which the Custodian is appointed as the custodian of the Company's cash and securities.

The principal terms of the Custodian Agreement are as follows:

(a) the Custodian shall hold and safeguard the assets and collect distributions, principal and other monetary and non-monetary rights and advantages when due;

(b) the Custodian may register, or procure the registration of, legal title to securities in the name of a nominee company, the Custodian, an agent, any settlement system, clearing agency, central depository, federal entry account system or similar system, or such other name as the Custodian considers appropriate;

(c) the Custodian may appoint as its agent one or more sub-custodians located in any part of the world to hold the assets of any separate account established by the Company for investment in foreign securities. The Custodian shall exercise due skill, care and diligence in the selection, appointment and periodic review of sub-custodians and arrangements for the holding and safekeeping of the Company's assets;

(d) the Custodian is entitled to be paid customary fees as set out in paragraph 5 of Part 7 (Directors, Management and Administration), which will be invoiced monthly in arrear;

(e) the Company shall reimburse the Custodian for all expenses the Custodian reasonably incurs in connection with the proper performance of its duties;

(f) the Custodian has agreed to indemnify the Company in respect of losses which are a direct result of the negligence, wilful default or fraud of the Custodian or a sub-custodian;

(g) the Company has agreed to indemnify the Custodian, its affiliates and respective directors, officers and employees from all losses and claims arising out of or in connection with any matter which per the terms of the Custodian Agreement the Custodian is protected, not liable or not responsible, or otherwise in respect of any act or omission of the Custodian in the absence of the Custodian's bad faith, negligence, wilful default or fraud;

(h) the Custodian Agreement is terminable upon 30 days' written notice from one party to the other; and

(i) the Custodian Agreement is governed by the laws of England and Wales.

6.9 Prime Brokerage Agreement

The Prime Brokerage agreement is dated 7 January 2020 between the Company and J.P. Morgan Securities PLC whereby J.P. Morgan Securities PLC has agreed to act as prime broker to the Company.

J.P. Morgan, provides international prime brokerage services to the Company under the terms of the Prime Brokerage Agreement entered into between the Company and the Prime Broker for itself and as agent and trustee for certain other members of the J.P. Morgan group of companies (the "J.P. Morgan Entities"). These services may include the provision to the Company of clearing, settlement and share borrowing facilities. The Company may also utilise the Prime Broker, other J.P. Morgan Entities and other brokers and dealers for the purposes of executing transactions for the Company.

117

The Prime Broker provides a custody service for the safe keeping of assets provided under or pursuant to the terms of the Prime Brokerage Agreement and/or may arrange for such assets to be held by an affiliate or third party as custodian or sub-custodian, on the terms set out in the Prime Brokerage Agreement.

Where J.P. Morgan acts as custodian it will open, or cause to be opened in its books and records one or more prime brokerage account(s) for the recording of the Company's assets. The title to such prime brokerage account(s) will make clear that assets recorded in the prime brokerage account(s) belong to the Company and are segregated from J.P. Morgan's own assets. J.P. Morgan will register or record legal title to the Company's assets in any name permitted by the rules of the FCA. In the event that any of the Company's investments are registered in the name of the Prime Broker where, due to the nature of the law or market practice of jurisdictions outside the United Kingdom, it is in the Company's best interests so to do or it is not feasible to do otherwise, such investments may not be segregated from the Prime Broker's own investments and in the event of the Prime Broker's default may not be as well protected.

Where the Prime Broker holds or receives on the Company's behalf cash as margin it will not be treated by the Prime Broker as client money and will not be subject to the client money protections conferred by the FCA's Client Money Rules. As a consequence, the Company's cash will not be segregated from the Prime Broker's own cash and will be used by the Prime Broker in the course of its investment business, and the Company will therefore rank as one of the Prime Broker's general creditors in relation thereto. The Company may from time to time call for the redelivery of cash provided it meets the margin requirements.

As continuing security for the due payment and discharge by the Company of its obligations under the Prime Brokerage Agreement the Company has agreed to charge by way of first fixed charge, and assign by way of security, in J.P. Morgan's favour for itself and as agent and trustee for each other J.P. Morgan Entity with full title guarantee and free from any adverse interest whatsoever and in priority to all other security whatsoever, certain rights, title and interests, including all rights, title and interests in any property held by the Prime Broker or any other J.P. Morgan Entity. JP Morgan may also apply any cash or assets credited to the Company's accounts with the Prime Broker or any other J.P. Morgan Entity as margin, collateral or credit support.

The Company's assets transferred to J.P. Morgan may be borrowed, lent or otherwise used by the Prime Broker for its own purposes or for the account of J.P. Morgan's clients to the extent permitted under applicable law, whereupon such investments will become the absolute property of the Prime Broker (or that of its transferee) and the Company will have a right against the Prime Broker for the return of equivalent assets. In the event of J.P. Morgan's insolvency the Company will accordingly be a general unsecured creditor of J.P. Morgan in respect of J.P. Morgan's obligation to return equivalent assets and the Company may not therefore be able to obtain such equivalent assets in full.

Neither the Prime Broker nor any J.P. Morgan Entity nor any of their affiliates, directors officers or employees will be liable for any loss suffered by the Company under or in connection with the Prime Brokerage Agreement unless and to the extent such loss is caused directly by the gross negligence, fraud or wilful default of the Prime Broker or such J.P. Morgan Entity, affiliate, officer or employee. The Company has agreed to reimburse, hold harmless and indemnify the Prime Broker, each J.P. Morgan Entity, their affiliates and each of their respective directors, officers and employees for any and all losses arising out of or in connection with the Prime Brokerage Agreement and unless and to the extent that the gross negligence, fraud or wilful default of the Prime Broker or such J.P. Morgan Entity has caused such loss.

J.P. Morgan and the Company are each entitled to terminate the Prime Brokerage Agreement upon not less than 30 calendar days' prior notice and J.P. Morgan may terminate the Prime Brokerage Agreement with immediate effect upon the occurrence of an event of default or the good faith determination of J.P. Morgan that the performance of an action would be unlawful, provided, however, that the termination of the Prime Brokerage Agreement shall be without prejudice, amongst other matters, to the accrued rights and obligations of the parties under the Prime Brokerage Agreement.

The Prime Broker is a service provider to the Company and is not responsible for the preparation of this Prospectus or the activities of the Company and therefore accepts no responsibility for any information contained in this Prospectus. The Prime Broker will not participate in the investment decision-making process. The Prime Brokerage Agreement is governed by English law.

118

Litigation

There are no governmental, legal or arbitration proceedings (including any such proceedings which are pending or threatened of which the Company is aware) which may have, or have had, in the recent past, significant effects on the Company or the Company's financial position or profitability in the last twelve months.

No Significant change

As at the date of this Prospectus, there has been no significant change in the financial position or financial performance of the Company since 30 June 2021, being the latest date at which financial information (incorporated by reference into this Prospectus) has been published by the Company.

Third party information and consents

Shore Capital, as sole bookrunner, has given and not withdrawn its written consent to the inclusion in this Prospectus of references to its name in the form and context in which it appears.

International Fund Management Limited as AIFM, has given and not withdrawn its written consent to the inclusion in this Prospectus of references to its name in the form and context in which it appears.

Rising Sun as Investment Adviser has given and not withdrawn its written consent to the inclusion in this Prospectus of references to its name in the form and context in which it appears.

The Investment Adviser accepts responsibility for the information contained in Part 8 (Investment Approach, Strategy and Process), and paragraph 3 of Part 7 (Directors, Management and Administration) of this Prospectus, and declares that, having taken all reasonable care to ensure that such is the case, the information attributed to it in this document is, to the best of its knowledge, in accordance with the facts and contains no omission likely to affect its import. All such information is included in this document, in the form and context in which it appears, with the consent of the Investment Adviser.

Certain information contained in this Prospectus has been sourced from third parties. The sources of such information are provided throughout this Prospectus where used. Such information has been accurately reproduced and, as far as the Company and Rising Sun are able to ascertain from information published by such third parties, no facts have been omitted which would render the reproduced information inaccurate or misleading.

General

The Company is not dependent on patents or licences, industrial, commercial or financial contracts or new manufacturing processes which are material to the Company's business or profitability.

No application is being made for the Shares to be listed or dealt in on any stock exchange or investment exchange other than the London Stock Exchange.

The publication or delivery of this Prospectus shall not under any circumstances imply that the information contained in this Prospectus is correct as at any time subsequent to the date of this Prospectus or that there has not been any change in the affairs of the Company since that date.

As at the date of the Prospectus the Company has no subsidiaries but may form one or more subsidiaries for the purposes of its business.

Working capital

In the Company's opinion, the Company's working capital is sufficient for the Company's present requirements (that is for at least 12 months following the date of this Prospectus).

Capitalisation and indebtedness

Details of capitalisation are set out in paragraph 2 of this Part 14. As at the date of this Prospectus, the Company had no guaranteed and unguaranteed, secured and unsecured indebtedness.

There are no indirect or contingent liabilities.

119

The following table shows the Company's unaudited indebtedness (distinguishing between guaranteed and unguaranteed, secured and unsecured indebtedness) as at 25 October 2021 and the Company's unaudited capitalisation as at 30 June 2021 (being the latest published financial information of the Company).

| | 25 October 2021
£'000 |
| --- | --- |
| Total current debt | |
| Guaranteed | – |
| Secured | – |
| Unguaranteed/unsecured | – |
| Total current debt | – |
| Non-current debt (excluding current portion of long-term debt) | – |
| Guaranteed | – |
| Secured | – |
| Unguaranteed/unsecured | – |
| Total non-current debt | – |
| | 30 June 2021
£'000 |
| Shareholders' equity | |
| Share capital | 1,030 |
| Other reserves | 125,869 |
| Total Shareholders' equity | 126,899 |

As at the date of this Prospectus, there has been no material change in the unaudited capitalisation or indebtedness of the Company.

The following table shows the Company's unaudited net indebtedness as at 25 October 2021.

| | 25 October 2021
£'000 |
| --- | --- |
| Shareholders equity (£000s) | |
| Share capital | 103,000.0 |
| Other reserves | 35,455.3 |
| Total | 138,455.3 |
| Total current debt (£000s) | |
| Guaranteed | 0.0 |
| Secured | 0.0 |
| Unguaranteed/unsecured | 0.0 |
| Total non-current debt (excluding current position of non-current debt) (£000s) | |
| Guaranteed | 0.0 |
| Secured | 0.0 |
| Unguaranteed/unsecured | 0.0 |

	25 October 2021 £'000
Net indebtedness (£000s)
A. Cash	6,684.5
B. Cash equivalents	1,831.8
C. Trading securities	0.0
D. Liquidity (A+B+C)	8,516.3
E. Current financial receivables	0.0
F. Current bank debt	0.0
G. Current portion of non-current debt	0.0
H. Other current financial debt	0.0
I. Current financial debt (F+G+H)	0.0
J. Net current financial indebtedness/(receivables) (I-E-D)	(8,516.3)
K. Non-current bank loans	0.0
L. Bonds issued	0.0
M. Other non-current loans	0.0
N. Non-current financial indebtedness (K+L+M)	0.0
O. Net financial indebtedness/(receivables) (J+N)	(8,516.3)

13. Availability of Prospectus

A copy of this Prospectus will be available for inspection at The National Storage Mechanism which is located at https://data.fca.org.uk/a/nsm/nationalstoragemechanism and for as long as Shares are available for issue under this Prospectus, copies of this Prospectus are available for collection, free of charge from the Company's registered office. The Prospectus will also be available on the Company's website - www.nipponactivevaluefund.com.

14. Documents on display

The following documents will be available for inspection between 9:00 a.m. and 5:00 p.m. on any day (Saturdays, Sundays and public holidays excepted) at the offices of Travers Smith LLP, 10 Snow Hill, London EC1A 2AL, from the date of this Prospectus until the end of the Placing Programme:

(a) this Prospectus;
(b) the Memorandum and Articles;
(c) the audited report and accounts of the Company for the financial period from the Company's incorporation on 22 October 2019 ended 31 December 2020; and
(d) the unaudited half yearly reports of the Company for the six month periods ended 30 June 2020 and 30 June 2021.

These documents will also be available on the Company's website.

15. Intermediaries

There are no intermediaries authorised as at the date of this Prospectus to use this Prospectus in connection with the Intermediaries Offer.

Any new information with respect to Intermediaries unknown at the time of approval of this Prospectus, including in respect of any Intermediaries who are appointed after the date of this Prospectus, will be made available on the Company's website, www.nipponactivevaluefund.com.

PART 15

DEFINITIONS AND INTERPRETATION

Definitions

In this Prospectus, unless the context otherwise requires, the expressions as set out below shall bear the following meanings:

Act
the Companies Act 2006, as amended from time to time;

Administration Agreement
the company secretarial and administration agreement between the Company and the Administrator, a summary of which is set out in paragraph 6.4 of Part 14 (General Information) of this Prospectus;

Administrator
PraxisIFM Fund Services (UK) Limited;

Admission
the date on which admission of New Shares issued pursuant to the Issue or, if the context so requires, of New Ordinary Shares or C Shares issued pursuant to the Placing Programme to trading on the Specialist Fund Segment first becomes effective;

AGM
an annual general meeting of the Company;

AIC
the Association of Investment Companies;

AIC Code
the Association of Investment Companies' Code of Corporate Governance, as amended from time to time;

AIF
alternative investment fund, as defined in the UK AIFM Directive;

AIFM
alternative investment fund manager, as defined in the UK AIFM Directive;

AIFM Agreement
the agreement between the Company and the AIFM, a summary of which is set out in paragraph 6.3 of Part 14 (General Information) of this Prospectus;

AIFM Regulations
the Alternative Investment Fund Managers Regulations 2013 (SI) 2013/1773);

AIFM Rules
the UK AIFM Directive, and all applicable rules and regulations implementing the AIFM Directive in the UK, including without prejudice to the generality of the foregoing the AIFM Regulations and all relevant provisions of the FCA Rules;

Application Form
the application form for use in connection with the Offer for Subscription set out in the Appendix to this Prospectus;

Articles or Articles of Association
the articles of association of the Company, a summary of which is set out in paragraph 3 of Part 14 (General Information) of this Prospectus;

Audit Committee
the audit committee of the of the Company as described in paragraph 7.3 of Part 7 (Directors, Management and Administration) of this Prospectus;

Board or Directors
the directors of the Company whose names are set out in the paragraph headed 'Directors' in paragraph 1 of Part 7 (Directors, Management and Administration) of this Prospectus;

Business Days
any day on which the London Stock Exchange is open for business and banks are open for business in London (excluding Saturdays and Sundays);

122

123

C Shares
C Shares of £0.10 each in the capital of the Company having the rights and restrictions set out in paragraph 3.19 of Part 14 (General Information) of this Prospectus;

Co-Invest Entities
Michael 1925 LLC and Earle 1927 LLC;

Company
Nippon Active Value Fund plc;

Corporate Governance Code
the UK Corporate Governance Code dated July 2018 (as amended from time to time);

CREST
the system for the paperless settlement of trades in securities and the holding of uncertificated securities operated by Euroclear in accordance with the CREST Regulations;

CREST Regulations
the Uncertificated Securities Regulations 2001 (SI 2001 No. 2001/3755);

CRS
the Common Reporting Standard developed by the OECD;

Dalton
Dalton Investments LLC and Dalton Investments, Inc.;

Default Shares
has the meaning given to it in paragraph 3.19 of Part 14 (General Information) of this Prospectus;

Disclosure Guidance and Transparency Rules
the Disclosure Guidance and Transparency Rules made by the FCA under section 72 of FSMA;

DP Act
the Data Protection Act 2018, as amended;

EEA State
the member states of the European Economic Area from time to time;

ERISA
the United States Employee Retirement Income Security Act of 1974, as amended;

EU or European Union
the European Union first established by the treaty made at Maastricht on 7 February 1992;

EU AIFM Directive
the Alternative Investment Fund Managers Directive (2011/61/EU);

EU Market Abuse Regulation
Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC;

EU PRIIPs Regulation
Regulation (EU) No. 1286/2014 on key information documents for packaged retail and insurance-based investment products;

EU Prospectus Regulation
Regulation (EU) 2017/1129 as amended from time to time and any successor or replacement regulation;

Euroclear
(a company incorporated in England and Wales with registered number 02878738, being the operator of CREST);

European Economic Area or EEA
the European Union, Iceland, Norway and Liechtenstein;

EUWA
European Union (Withdrawal) Act 2018, as amended;

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

Exit Opportunity
the exit opportunity which the Directors intend to offer Shareholders around the fifth anniversary of First Admission;

FATCA
the U.S. Foreign Account Tax Compliance Act of 2010;

FCA
the Financial Conduct Authority;

124

FCA Rules
the handbook of rules and guidance of the FCA, as amended;

First C Share Admission
the date on which admission of C Shares issued pursuant to the Issue or the Placing Programme to trading on the Specialist Fund Segment first becomes effective;

First Admission
the date on which admission of C Shares issued pursuant to the Issue to trading on the Specialist Fund Segment first becomes effective;

FSA
the Financial Services Agency, the regulator responsible for the regulation of the financial sector in Japan;

FSMA
the Financial Services and Markets Act 2000, as amended;

GDPR
the General Data Protection Regulation (EU) 2016/679;

General Meeting
the general meeting of the Company to be held on 12 November 2021 for the purpose of considering the Resolutions;

GFSC
the Guernsey Financial Services Commission;

GICS
Global Industry Classification Standards;

Gross Asset Value
the value of the gross assets of the Company as determined in accordance with the accounting principles adopted by the Company from time to time;

HMRC
Her Majesty's Revenue and Customs;

IFRS
International Financial Reporting Standards, as adopted by the European Union or, with effect from 1 January 2021, the UK;

Initial Placing
the conditional placing by Shore Capital of New Shares described in this Prospectus in connection with the Issue, on the terms and subject to the conditions set out in the Placing Agreement and this Prospectus;

Intermediaries
the entities listed in paragraph 15 of Part 14 (General Information) of this Prospectus, together with any other intermediary (if any) that is appointed by the Company in connection with the Intermediaries Offer after the date of this Prospectus and "Intermediary" shall mean any one of them;

Intermediaries Booklet
the booklet containing, among other things, the Intermediaries Terms and Conditions;

Intermediaries Offer
the offer of New Shares by the Intermediaries to retail investors in the UK;

Intermediaries Terms and Conditions
the terms and conditions agreed between the Company, Shore Capital and the Intermediaries in relation to the Intermediaries Offer and contained in the Intermediaries Booklet;

Investment Advisory Agreement
the Investment Advisory Agreement between the Company, the AIFM and Rising Sun, a summary of which is set out in paragraph 6.2 of Part 14 (General Information) of this Prospectus;

Investment Company Act
the United States Investment Company Act of 1940, as amended;

IPO
initial public offering;

IPO Admission Date
21 February 2020, being the date on which the Company's Ordinary Shares were first admitted to trading on the Specialist Fund Segment in connection with the Company's IPO;

125

IPO Prospectus
the prospectus published by the Company relating to its IPO dated 7 January 2020, as supplemented by a supplementary prospectus dated 13 February 2020;

IRR
internal rate of return;

ISA
an investment plan for the purposes of chapter 3 of Part 6 of the Income Tax (Trading and Other Income) Act 2005 and the Individual Savings Account Regulations 1998 (SI 1998/1870), as amended;

Issue
the issue of C Shares or Ordinary Shares pursuant to the Initial Placing, the Offer for Subscription and the Intermediaries Offer;

Issuances
the Issue and Placing Programme;

Issue Expenses
the costs, commissions, fees and expenses incidental to the completion of the Issue;

Issue Price
100p per C Share and such price per Ordinary Share as is determined by the Directors as described in Part 11 (The Issue) of this Prospectus;;

IT Regulations
Investment Trust (Approved Company) (Tax) Regulations 2011;

JPX
Japan Exchange Group;

Key Information Document
any key information document relating to Shares in the Company produced pursuant to the UK PRIIPs Regulation or the EU PRIIPs Regulation, as amended from time to time;

Listing Rules
the listing rules made by the FCA pursuant to Part VI of FSMA;

London Stock Exchange
London Stock Exchange plc;

Main Market
the Main Market of the London Stock Exchange;

Management Engagement Committee
the management engagement committee of the Company as described in paragraph 7.4 of Part 7 (Directors, Management and Administration) of this Prospectus;

Memorandum
the memorandum of incorporation of the Company;

Net Asset Value or NAV
in relation to an Ordinary Share, its net asset value, in relation to Ordinary Shares, the net asset value per Ordinary Share multiplied by the number of Ordinary Shares in issue (excluding, for the avoidance of doubt, any Ordinary Shares held in treasury), in relation to a C Share, its net asset value, in relation to C Shares the net asset value per C Share multiplied by the number of C Shares in issue (excluding, for the avoidance of doubt, any C Shares held in treasury) and in relation to the Company, the net asset value of the Company as a whole, in each case calculated in accordance with the Company's normal reporting policies from time to time;

New Ordinary Shares
the new Ordinary Shares to be issued pursuant to the Issue or the Placing Programme or arising upon conversion of any C Shares issued pursuant to the Issuances, as the context requires;

New Shares
the New Ordinary Shares or C Shares as the case may be;

OECD
Organisation for Economic Co-operation and Development;

OECD Member State
means a member of the OECD;

Offer for Subscription
the offer for subscription to the public in the UK for New Shares on the terms and subject to the conditions set out in this Prospectus;

126

Official List
the Official List maintained by the FCA pursuant to Part VI of FSMA;

Ordinary Shares
ordinary shares of £0.01 each in the capital of the Company;

Panel
the UK Panel on Takeovers and Mergers;

Placee
any investor with whom Shares are placed by Shore Capital, as agent of the Company, pursuant to the Initial Placing or the Placing Programme;

Placing Agreement
the conditional placing and offer agreement between the Company, Rising Sun and Shore Capital details of which are set out in paragraph 6.5 of Part 14 (General Information) of this Prospectus;

Placing Programme
the proposed programme of placings in the 12 month period from the publication of this Prospectus of an aggregate number of New Ordinary Shares and/or C Shares equal in aggregate to 300 million less the number of Shares or Ordinary Shares issued under the Issue as described in this Prospectus;

Placing Programme Price
in the case of New Ordinary Shares, such price at which the New Ordinary Shares will be issued to places under the Placing Programme, being the last published cum income Net Asset Value per Ordinary Share at the time that the proposed issue is agreed as shall be determined by the Directors in accordance with paragraph 5 of Part 12 (Placing Programme) of this Prospectus, plus a premium intended to at least cover the associated issue costs and in the case of C Shares, 100p per C Share;

Portfolio
the Company's portfolio of Investments;

Prime Broker or J.P. Morgan
J.P. Morgan Securities PLC;

Prime Brokerage Agreement
the international prime brokerage agreement between the Company and JP Morgan, a summary of which is set out in paragraph 6.9 of Part 14 (General Information) of this Prospectus;

Programme Admission
the date on which any admission of Shares issued pursuant to the Placing Programme to trading on the Specialist Fund Segment first becomes effective;

Prospectus
this prospectus;

Prospectus Regulation Rules
the prospectus regulation rules made by the FCA under section 73A of FSMA;

QIB
qualified institutional buyer as defined in Rule 144A;

QP
qualified purchaser as defined in section 2(a)(51) of the Investment Company Act;

Receiving Agent
Computershare Investor Services PLC;

Receiving Agent's Agreement
the receiving agent's agreement between the Company and the Receiving Agent, a summary of which is set out in paragraph 6.7 of Part 14 (General Information) of this Prospectus;

Rosenwald Clients
means advisory clients of Dalton and Rosenwald Capital;

Redeemable Preference Shares
redeemable preference shares of £1.00 each in the capital of the Company, having the rights and being subject to the restrictions set out in the Articles, which are summarised in paragraph 3.19 of Part 14 (General Information) of this Prospectus (no such shares being in issue as at the date of this Prospectus);

127

Registrar
Computershare Investor Services PLC;

Registrar's Agreement
the registrar's agreement between the Company and the Receiving Agent, a summary of which is set out in paragraph 6.6 of Part 14 (General Information) of this Prospectus;

Regulation S
Regulation S under the Securities Act;

Regulatory Information Service or RIS
a regulatory information service that is on the list of regulatory information services maintained by the FCA;

Resolutions
the Share Allotment Authorities and the Share Buyback Resolution;

Rising Sun or Investment Adviser
Rising Sun Management Ltd.;

Rising Sun Management Team
Rising Sun's investment professionals and the senior team members responsible for providing the investment advisory services, whose profiles are set out in paragraph 3.3 of Part 7 (Directors, Management and Administration);

Rosenwald Associates
Rosenwald Clients and Shore Capital;

Rosenwald Clients
has the meaning given to such term in paragraph 4.2 of Part 14 (General Information);

Rosenwald Capital
Rosenwald Capital Management, Inc.;

Rule 9
Rule 9 of the Takeover Code;

Rule 144A
Rule 144A under the Securities Act;

Securities Act
the United States Securities Act of 1933, as amended;

Share Allotment Authorities
the resolutions to be proposed at the General Meeting granting the Directors the authority to allot Shares pursuant to the Issue and the Placing Programme and relating to the disapplication of pre-emption rights in respect of the Shares to be issued pursuant to the Issue and the Placing Programme;

Share Buyback Resolution
the shareholder resolution to be proposed at the General Meeting granting the Company authority to make market purchases of the Company's C Shares;

Shareholder
holder of Shares;

Shares
Ordinary Shares and/or C Shares as the context requires;

Shore Capital
Shore Capital & Corporate Limited (the Company's financial adviser) and/or Shore Capital Stockbrokers Limited (The Company's bookrunner and stockbroker);

SIPP
self-invested personal pension;

SORP
the Statement of Recommended Practice for Financial Statements of Investment Trust Companies issued by the Association of Investment Trust Companies, as amended from time to time;

Specialist Fund Segment
the specialist fund segment of the Main Market;

SPV
special purpose vehicle;

Subsequent Expenses
has the meaning given in paragraph 7 of Part 12 (The Placing Programme) of this Prospectus;

Subsequent Placing
a placing of Shares pursuant to the Placing Programme;

128

SSAS
small self administered pension scheme;

Statutes
the Act as amended and every other statute for the time being in force concerning companies and affecting the Company;

Takeover Code
the City Code on Takeovers and Mergers, as amended from time to time;

Target Market Assessment
has the meaning given in Part 2 (Important Information) of this Prospectus;

United States or U.S.
the United States of America, its possessions or territories, any State of the United States of America and the district of Columbia or any area subject to its jurisdiction or any political subdivision thereof;

USE Instruction
an instruction created through CREST;

U.S. Person
a U.S. person as defined in Regulation S;

UK or United Kingdom
the United Kingdom of Great Britain and Northern Ireland;

UK AIFM Directive
the requirements of the FCA Rules implementing the EU AIFM Directive (Directive 2011/61/EU) in the United Kingdom and related UK laws (including Commission Delegated Regulation (EU) No 231/2013, as it forms part of UK law by virtue of the EUWA;

UK Market Abuse Regulation
the UK version of the EU Market Abuse Regulation as adopted into UK law by virtue of the EUWA;

UK PRIIPs Regulation
the UK version of the EU PRIIPs Regulation, as adopted into UK law by virtue of the EUWA;

UK Prospectus Regulation
the UK version of the EU Prospectus Regulation, which is part of UK law by virtue of the EUWA;

VAT
value added tax; and

Website
www.nipponactivevaluefund.com.

PART 16

TERMS AND CONDITIONS OF APPLICATION UNDER THE INITIAL PLACING AND THE PLACING PROGRAMME

Introduction

Each investor which confirms its agreement to subscribe for Placing Shares under the Initial Placing and/or any Subsequent Placing (as applicable) to Shore Capital (for the purposes of this Part 16, (a “Placee”) will be bound by these terms and conditions and will be deemed to have accepted them.

The Company and/or Shore Capital, as applicable, may require a Placee to agree to such further terms and/or conditions and/or give such additional warranties and/or representations as it (in its absolute discretion) sees fit and/or may require any such Placee to execute a separate placing letter (for the purposes of this Part 16, a “Placing Letter”). The terms of this Part 16 will, where applicable, be deemed to be incorporated into that Placing Letter.

Agreement to Subscribe for Placing Shares

Conditional on, amongst other things: (i) the Share Allotment Authorities being passed at the General Meeting and not having been revoked or superseded; (ii) First Admission occurring and becoming effective by 8:00 a.m. (London time) on or prior to 25 November 2021 (or such later time and/or date, not being later than 8:00 a.m. on 31 January 2022 as the Company, the Investment Adviser and Shore Capital may agree) or the relevant Programme Admission occurring in respect of any Subsequent Placing not later than 8:00 a.m. on such date as may be agreed between the Company, the Investment Adviser and Shore Capital prior to the closing of the relevant placing, not being later than 24 October 2022; (iii) in the case of any issue under a Subsequent Placing, to the extent required by Article 23(1) of the UK Prospectus Regulation, a valid supplementary prospectus being published by the Company; (iv) the Placing Agreement becoming otherwise unconditional in all respects (other than in respect of any condition regarding First Admission) in relation to the relevant issue and not having been terminated in accordance with its terms on or before 8:00 a.m. on the date of First Admission or the relevant Programme Admission, as applicable; and (v) Shore Capital confirming to the Placees their allocation of Ordinary Shares or C Shares, as applicable, a Placee agrees to become a member of the Company and agrees to subscribe for those Ordinary Shares and/or C Shares allocated to it by Shore Capital at the Issue Price or the applicable Placing Programme Price (as the case may be). To the fullest extent permitted by law, each Placee acknowledges and agrees that it will not be entitled to exercise any remedy of rescission at any time. This does not affect any other rights the Placee may have.

Multiple applications or suspected multiple applications on behalf of a single investor are liable to be rejected. Fractions of shares will not be issued.

Payment for Ordinary Shares/C Shares

Each Placee undertakes to pay in full the Issue Price or the Placing Programme Price, as applicable, for the Ordinary Shares or C Shares issued to such Placee in the manner and by the time directed by Shore Capital. In the event of any failure by a Placee to pay as so directed and/or by the time required by Shore Capital, the relevant Placee shall be deemed hereby to have irrevocably and unconditionally appointed Shore Capital or any nominee of Shore Capital as its agent to use its reasonable endeavours to sell (in one or more transactions) any or all of the Ordinary Shares or C Shares (as applicable) in respect of which payment shall not have been made as directed, and to indemnify Shore Capital and its respective affiliates on demand in respect of any liability for stamp duty and/or stamp duty reserve tax or any other liability whatsoever arising in respect of any such sale or sales.

A sale of all or any of such Ordinary Shares or C Shares shall not release the relevant Placee from the obligation to make such payment for relevant Ordinary Shares or C Shares to the extent that Shore Capital or its nominee has failed to sell such Ordinary Shares or C Shares at a consideration which, after deduction of the expenses of such sale and payment of stamp duty and/or stamp duty reserve tax as aforementioned, is equal to or exceeds the Issue Price or Placing Programme Price.

129

Representations, Warranties and Undertakings

4.1 By agreeing to subscribe for Ordinary Shares or C Shares (as applicable), each Placee which enters into a commitment to subscribe for Ordinary Shares or C Shares (as applicable) (for the purposes of this Part 16, a “Placing Commitment”) will (for itself and for any person(s) procured by it to subscribe for Ordinary Shares or C Shares and any nominee(s) for any such person(s)) be deemed to acknowledge, understand, undertake, represent and warrant to each of the Company, the Investment Adviser, the Registrar and Shore Capital, that:

4.1.1 in agreeing to subscribe for Ordinary Shares or C Shares (as applicable) under the Initial Placing and/or Subsequent Placing, it is relying solely on this Prospectus and any supplementary prospectus issued by the Company prior to First Admission or the relevant Programme Admission (as applicable) and not on any other information given, or representation or statement made at any time, by any person concerning the Company, the Ordinary Shares, the C Shares or the Initial Placing and/or any Subsequent Placing. It agrees that none of the Company, the Investment Adviser, the Registrar or Shore Capital, nor any of their respective officers, agents, employees or affiliates, will have any liability for any other information or representation. It irrevocably and unconditionally waives any rights it may have against any such persons in respect of any other information or representation;

4.1.2 if the laws of any territory or jurisdiction outside the United Kingdom are applicable to its agreement to subscribe for Ordinary Shares or C Shares under the Initial Placing or any Subsequent Placing, it warrants that it has complied with all such laws, obtained all governmental and other consents which may be required, complied with all requisite formalities and paid any issue, transfer or other taxes due in connection with its application in any such territory or jurisdiction and that it has not taken any action or omitted to take any action which will or might reasonably be expected to result in the Company, the Investment Adviser, the Registrar or Shore Capital, or any of their respective officers, agents, employees or affiliates acting in breach of the regulatory or legal requirements, directly or indirectly, of any territory or jurisdiction outside the United Kingdom in connection with the Initial Placing or any Subsequent Placing.

4.1.3 it has carefully read and understands this Prospectus and any supplementary prospectus issued by the Company prior to First Admission or the relevant Programme Admission (as applicable) in its entirety and acknowledges that it is acquiring Ordinary Shares or C Shares on the terms and subject to the conditions set out in this Part 16 and, as applicable, in the contract note or oral or email placing confirmation, as applicable, referred to in paragraph 4.1.11 of this Part 16 (for the purposes of this Part 16 the “Contract Note” or the “Placing Confirmation”) and the Placing Letter (if any) and the Articles as in force at the date of First Admission or the relevant Programme Admission (as applicable);

4.1.4 it has not relied on Shore Capital, or any person affiliated with Shore Capital in connection with any investigation of the accuracy of any information contained in this Prospectus;

4.1.5 the content of this Prospectus and any supplementary prospectus issued by the Company is exclusively the responsibility of the Company and its Directors and none of Shore Capital, the Investment Adviser, the Registrar, nor any person acting on their behalf nor any of their respective affiliates are responsible for or shall have any liability for any information, representation or statement contained in this Prospectus (and any such supplementary prospectus issued by the Company) or any information previously published by or on behalf of the Company and will not be liable for any decision by a Placee to participate in the Initial Placing and/or any Subsequent Placing based on any information, representation or statement contained in this Prospectus or otherwise;

4.1.6 no person is authorised in connection with the Initial Placing and/or any Subsequent Placing to give any information or make any representation other than as contained in this Prospectus and any supplementary prospectus issued by the Company prior to the date of First Admission or the relevant Programme Admission and, if given or made, any information or representation must not be relied upon as having been authorised by Shore Capital, the Company, the Investment Adviser or the Registrar;

4.1.7 it is not applying as, nor is it applying as nominee or agent for, a person who is or may be liable to notify and account for tax under the Stamp Duty Reserve Tax Regulations 1986 at any of the

130

increased rates referred to in section 67, 70, 93 or 96 (depository receipts and clearance services) of the Finance Act 1986;

4.1.8 the price per Ordinary Share and/or C Share is fixed at the Issue Price or the Placing Programme Price (which shall be £1.00 in respect of any C Shares) as applicable and is payable to Shore Capital on behalf of the Company in accordance with the terms of this Part 16 and, as applicable, in the Contract Note or Placing Confirmation and the Placing Letter (if any);

4.1.9 it has the funds available to pay in full for the Ordinary Shares or C Shares for which it has agreed to subscribe pursuant to its Placing Commitment and that it will pay the total subscription in accordance with the terms set out in this Part 16 and, as applicable, as set out in the Contract Note or Placing Confirmation and the Placing Letter (if any) on the due time and date;

4.1.10 its commitment to acquire Ordinary Shares and/or C Shares under the Initial Placing or any Subsequent Placing (as applicable) will be agreed orally or in writing (which shall include by email) with Shore Capital as agent for the Company and that a Contract Note or Placing Confirmation will be issued by Shore Capital as soon as possible thereafter. That oral or written agreement will constitute an irrevocable, legally binding commitment upon that person (who at that point will become a Placee) in favour of the Company and Shore Capital to subscribe for the number of Ordinary Shares and/or C Shares (as applicable) allocated to it and comprising its Placing Commitment at the Issue Price or the Placing Programme Price (as applicable) on the terms and conditions set out in this Part 16 and, as applicable, in the Contract Note or Placing Confirmation and the Placing Letter (if any) and in accordance with the Articles in force as at the date of First Admission or the relevant Programme Admission (as applicable). Except with the consent of Shore Capital such oral or written commitment will not be capable of variation or revocation after the time at which it is made;

4.1.11 its allocation of Ordinary Shares and/or C Shares under the Initial Placing and/or the Placing Programme (as applicable) under the Placing will be evidenced by Contract Note or Placing Confirmation, as applicable, confirming: (i) the number of Ordinary Shares and/or C Shares that such Placee has agreed to acquire; (ii) the aggregate amount that such Placee will be required to pay for such Ordinary Shares and/or C Shares; and (iii) settlement instructions to pay Shore Capital as agent for the Company. The terms of this Part 16 will be deemed to be incorporated into that Contract Note or Placing Confirmation;

4.1.12 settlement of transactions in the Ordinary Shares and/or C Shares following First Admission or the relevant Programme Admission (as applicable), will take place in CREST but Shore Capital reserves the right in its absolute discretion to require settlement in certificated form if, in its opinion, delivery or settlement is not possible or practicable within the CREST system within the timescales previously notified to the Placee (whether orally, in the Contract Note or Placing Confirmation, in the Placing Letter or otherwise) or would not be consistent with the regulatory requirements in any Placee's jurisdiction;

4.1.13 none of the Ordinary Shares or C Shares have been or will be registered under the laws of any EEA State (other than any EEA member state where the Shares are lawfully marketed), the United States, Canada, Japan, Australia, the Republic of South Africa or any other jurisdiction where the extension or availability of the Initial Placing and/or any subsequent Placing would breach any applicable law. Accordingly, neither the Ordinary Shares nor the C Shares may be offered, sold, issued or delivered, directly or indirectly, within any of the following: any EEA State (other than any EEA member state where the Shares are lawfully marketed), the United States, Canada, Japan, Australia, the Republic of South Africa or any other jurisdiction where the extension or availability of the Initial Placing and/or any subsequent Placing would breach any applicable law unless an exemption from any registration requirement is available;

4.1.14 it: (i) is entitled to subscribe for the Ordinary Shares and/or C Shares under the laws of all relevant jurisdictions; (ii) has fully observed the laws of all relevant jurisdictions; (iii) has the requisite capacity and authority and is entitled to enter into and perform its obligations as a subscriber for Ordinary Shares and/or C Shares and will honour such obligations; and (iv) has obtained all necessary consents and authorities to enable it to enter into the transactions contemplated hereby and to perform its obligations in relation thereto;

131

4.1.15 if it is within the United Kingdom, it is (a) (i) a qualified investor within the meaning of Article 2(e) of the UK Prospectus Regulation; and (ii) a person who falls within Articles 49(2)(a) to (d), 19(1) or 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 or is a person to whom the Ordinary Shares or C Shares may otherwise lawfully be offered whether under such Order or otherwise; or (b) if it is receiving the offer in circumstances under which the laws or regulations of a jurisdiction other than the United Kingdom would apply, that it is a person to whom the Ordinary Shares or C Shares may be lawfully offered under that other jurisdiction's laws and regulations;

4.1.16 if it is a resident in a EEA State, it is (a) a “qualified investor” within the meaning of Article 2(e) of the EU Prospectus Regulation; and (b) otherwise permitted to be marketed to in accordance with the provisions of the EU AIFM Directive as implemented in the relevant Member State in which it is located;

4.1.17 in the case of any Ordinary Shares or C Shares acquired by a Placee as a financial intermediary within the meaning of Article 5(1) of the UK Prospectus Regulation or the EU Prospectus Regulation (as applicable): (i) the Ordinary Shares or C Shares acquired by it in the Initial Placing and/or any subsequent Placing have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in the UK or any relevant Member State other than qualified investors, as that term is defined in the UK Prospectus Regulation or the EU Prospectus Regulation (as applicable), or in circumstances in which the prior consent of Shore Capital has been given to the offer or resale; or (ii) where Ordinary Shares or C Shares have been acquired by it on behalf of persons the UK or in any relevant Member State other than qualified investors, the offer of those Ordinary Shares or C Shares to it is not treated under the UK Prospectus Regulation or the EU Prospectus Regulation (as applicable) as having been made to such persons;

4.1.18 if it is outside the United Kingdom, neither this Prospectus (and any supplementary prospectus issued by the Company) nor any other offering, marketing or other material in connection with the Initial Placing and/or any Subsequent Placing or the Ordinary Shares or C Shares (for the purposes of this Part 16, each a “Placing Document”) constitutes an invitation, offer or promotion to, or arrangement with, it or any person for whom it is procuring to subscribe for Ordinary Shares or C Shares pursuant to the Initial Placing and/or any Subsequent Placing unless, in the relevant territory, such offer, invitation, promotion or other course of conduct could lawfully be made to it or such person and such documents or materials could lawfully be provided to it or such person and Ordinary Shares or C Shares could lawfully be distributed to and subscribed and held by it or such person without compliance with any unfulfilled approval, registration or other regulatory or legal requirements;

4.1.19 (i) the Ordinary Shares and C Shares have not been and will not be registered under the Securities Act and are being offered solely (a) outside the United States to non-U.S. Persons in “offshore transactions” as defined in and pursuant to Regulation S; or (b) within the United States to, or to U.S. Persons to are, both QIBs and QPs pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act; (ii) the Company has not registered, and does not intend to register, as an investment company under the Investment Company Act; and the Ordinary Shares and C Shares may only be transferred in circumstances which will not result in the Company being required to register under the Investment Company Act; and (iii) that, in each case, it agrees to sell, transfer, assign, pledge or otherwise dispose of the Ordinary Shares and C Shares to non-US Persons in offshore transactions in compliance with Regulation S (which includes, for the avoidance of doubt, any bona fide sale on the Main Market) or in transactions that are exempt from registration under the Securities Act and do not require the Company to register under the Investment Company Act;

4.1.20 if the laws of any territory or jurisdiction outside the United Kingdom are applicable to its agreement to subscribe for Ordinary Shares or C Shares under the Initial Placing and/or any Subsequent Placing, that it has complied with all such laws, obtained all governmental and other consents which may be required, complied with all requisite formalities and paid any issue, transfer or other taxes due in connection with its application in any such territory or jurisdiction and that it has not taken any action or omitted to take any action which will or might reasonably be expected to result in the Company, the Investment Adviser, the Registrar or Shore Capital, or any of their respective officers, agents, employees or affiliates acting in breach of the regulatory

132

or legal requirements, directly or indirectly, of any territory or jurisdiction outside the United Kingdom in connection with the Initial Placing and/or any Subsequent Placing;

4.1.21 If (a) it is a U.S. Person, it is a QIB that is also a QP, and has acknowledged and complied with all of the requirements set forth in section 5 below, including the delivery of a signed Investor Representation Letter to the Company and Shore Capital and (b) if it is not a U.S. Person, that (i) neither the Ordinary Shares nor the C Shares have been or will be registered under the Securities Act and are being offered outside the United States in compliance with Regulation S and that it is purchasing such Shares outside the United States in compliance with such regulations; (ii) the Company has not registered, and does not intend to register, as an investment company under the Investment Company Act and the Ordinary Shares and C Shares may only be transferred under circumstances which will not result in the Company being required to register under the Investment Company Act and (iii) that, in each case, it agrees to sell, transfer, assign, pledge or otherwise dispose of the Shares to non-U.S. Persons in offshore transactions in compliance with Regulation S (which includes, for the avoidance of doubt, any bona fide sale on the Main Market) or in transactions that are exempt from registration under the Securities Act and do not require the Company to register under the Investment Company Act;

4.1.22 it has not, directly or indirectly, distributed, forwarded, transferred or otherwise transmitted this Prospectus (and any supplementary prospectus issued by the Company) or any other Placing Document to any persons within the United States or to any U.S. Person, nor will it do any of the foregoing;

4.1.23 it does not have a registered address in, and is not a citizen, resident or national of any EEA State (other than any EEA member state where the Shares are lawfully marketed), Canada, Japan, Australia, the Republic of South Africa or any other jurisdiction in which it is unlawful to make or accept an offer of the Ordinary Shares or C Shares and it is not acting on a non-discretionary basis for any such person;

4.1.24 if the Placee is a natural person, such Placee is not under the age of majority (18 years of age in the United Kingdom) on the date of such Placee's agreement to subscribe for Ordinary Shares and/or C Shares under the Initial Placing and/or any Subsequent Placing and will not be any such person on the date that such subscription is accepted;

4.1.25 (i) it has communicated or caused to be communicated and will communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) relating to the Ordinary Shares and C Shares only in circumstances in which section 21(1) of FSMA does not require approval of the communication by an authorised person; and (ii) that no Placing Document is being issued by Shore Capital in its capacity as an authorised person under section 21 of FSMA and the Placing Documents may not therefore be subject to the controls which would apply if the Placing Documents were made or approved as a financial promotion by an authorised person;

4.1.26 it is aware of and acknowledges that it is required to comply with all applicable provisions of FSMA with respect to anything done by it in relation to the in, from or otherwise involving, the United Kingdom;

4.1.27 it is aware of the obligations regarding insider dealing in the Criminal Justice Act 1993, the UK Market Abuse Regulation and the Proceeds of Crime Act 2002 and confirms that it has and will continue to comply with those obligations;

4.1.28 no action has been taken or will be taken in any jurisdiction other than the United Kingdom that would permit a public offering of the Ordinary Shares or C Shares or possession of this Prospectus (and any supplementary prospectus issued by the Company), in any country or jurisdiction where action for that purpose is required;

4.1.29 Shore Capital, nor any of its affiliates nor any person acting on their behalf is making any recommendations to it, advising it regarding the suitability of any transactions it may enter into in connection with the Initial Placing and/or any Subsequent Placing or providing any advice in relation to the Initial Placing and/or Subsequent Placing and participation in the Initial Placing and/or any Subsequent Placing is on the basis that it is not and will not be a client of Shore Capital and that Shore Capital has no duties or responsibilities to it for providing the protections afforded

133

to its clients or for providing advice in relation to the Initial Placing and/or Subsequent Placing nor, if applicable, in respect of any representations, warranties, undertaking or indemnities contained in any Placing Letter;

4.1.30 that, save in the event of fraud on the part of Shore Capital, none of Shore Capital, its ultimate holding companies, any direct or indirect subsidiary undertakings of such holding Company, any of its respective directors, members, partners, officers and employees shall be responsible or liable to a Placee or any of its clients for any matter arising out of a Shore Capital's role as sponsor, broker or otherwise in connection with the Initial Placing and/or Subsequent Placing and that where any such responsibility or liability nevertheless arises as a matter of law the Placee and, if relevant, its clients, will immediately and irrevocably waive any claim against any of such persons which the Placee or any of its clients may have in respect thereof;

4.1.31 that where it is subscribing for Ordinary Shares or C Shares for one or more managed, discretionary or advisory accounts, it is authorised in writing for each such account: (i) to subscribe for the Ordinary Shares or C Shares for each such account; (ii) to make on each such account's behalf the undertakings, acknowledgements, representations, warranties and agreements set out in this Prospectus; and (iii) to receive on behalf of each such account any documentation relating to the Initial Placing and/or any subsequent Placing in the form provided by the Company and Shore Capital. It agrees that the provision of this paragraph shall survive any resale of the Ordinary Shares or C Shares by or on behalf of any such account;

4.1.32 it irrevocably appoints any Director and any director or duly authorised employee or agent of Shore Capital to be its agent and on its behalf (without any obligation or duty to do so), to sign, execute and deliver any documents and do all acts, matters and things as may be necessary for, or incidental to, its subscription for all or any of the Ordinary Shares and/or C Shares comprising its Placing Commitment in the event of its own failure to do so;

4.1.33 if the Initial Placing and/or any Subsequent Placing does not proceed or the relevant conditions under the Placing Agreement are not satisfied or the Ordinary Shares or C Shares for which valid applications are received and accepted are not admitted to trading on the Specialist Fund Segment for any reason whatsoever then none of Shore Capital, the Company, the Investment Adviser and persons controlling, controlled by or under common control with any of them, and any of their respective employees, agents, officers, members, stockholders, partners or representatives, shall have any liability whatsoever to it or any other person;

4.1.34 in connection with its participation in the Initial Placing and/or any Subsequent Placing it has observed all relevant legislation and regulations, in particular (but without limitation) those relating to money laundering and terrorist financing and that its application for Ordinary Shares or C Shares under the Initial Placing and/or any Subsequent Placing is only made on the basis that it accepts full responsibility for any requirement to verify the identity of its clients and other persons in respect of whom it has applied for Ordinary Shares and/or C Shares. In addition, it warrants that it is a person: (i) subject to the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 in force in the United Kingdom (the "Money Laundering Regulations"); or (ii) subject to the Money Laundering Directive (2015/849/EC of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purpose of money laundering and terrorist financing); or (iii) acting in the course of a business in relation to which an overseas regulatory authority exercises regulatory functions and is based or incorporated in, or formed under the law of, a country in which there are in force provisions at least equivalent to those required by the Money Laundering Regulations;

4.1.35 due to anti-money laundering requirements, Shore Capital or the Company may require proof of identity and verification of the source of the payment before the application for Ordinary Shares or C Shares under the Initial Placing and/or any Subsequent Placing can be processed and that, in the event of delay or failure by the applicant to produce any information required for verification purposes, Shore Capital and the Company may refuse to accept the application and the subscription monies relating thereto. It holds harmless and will hold harmless and indemnify Shore Capital and the Company against any liability, loss or cost ensuing due to the failure to process such application, if such information as has been requested has not been provided by it in a timely manner;

134

4.1.36 it acknowledges and agrees that information provided by it to the Company or the Registrar will be stored both on the Registrar's and the Company Secretary's computer system and manually. It acknowledges and agrees that for the purposes of the Data Protection Legislation, the Registrar, the Company Secretary and Shore Capital are each required to specify the purposes for which they will hold personal data. For the purposes of this Part 14 "Data Protection Legislation" means any law applicable from time to time relating to the processing of personal data and/or privacy, as in force at the date of this Agreement or as re-enacted, applied, amended, superseded, repealed or consolidated, including without limitation, the UK Data Protection Act 2018, the General Data Protection Regulation (EU) 2016/679 (as implemented in the UK), and the Privacy and Electronic Communications (EC Directive) Regulations 2003 (as implemented in the UK), in each case including any legally binding regulations, direction and orders issued from time to time under or in connection with any such law. The Registrar, the Company Secretary and Shore Capital will only use such information for the purposes set out below (collectively, the "Purposes"), being to:

(a) process its personal data (including special categories of personal data (as defined in applicable Data Protection Legislation)) as required for or in connection with the holding of Ordinary Shares and/or C Shares, including processing personal data in connection with credit and money laundering checks on it and effecting the payment of dividends and other distributions to Shareholders;

(b) communicate with it as necessary in connection with the proper running of its business affairs and generally in connection with the holding of Ordinary Shares and/or C Shares;

(c) provide personal data to such third parties as are or shall be necessary in connection with the proper running of its business affairs and generally in connection with the holding of Ordinary Shares and/or C Shares or as the Data Protection Legislation may require, including to third parties outside the United Kingdom or the European Economic Area (subject to the use of a transfer mechanism which is approved at the relevant time by the European Commission or any other regulatory body which has or acquires the right to approve methods of transfer of personal data outside the UK); and

(d) process its personal data for the purpose of their internal record-keeping and reporting obligations.

4.1.37 in providing Shore Capital, the Registrar and the Company Secretary with information, and to the extent that such information relates to a third party procured by a Placee to subscribe for Ordinary Shares and/or C Shares and any nominee for any such persons, it hereby represents and warrants to Shore Capital, the Registrar and the Company Secretary that it has obtained any necessary consents of any data subject whose data it has provided, to Shore Capital, the Registrar and the Company Secretary and their respective associates holding and using their personal data for the Purposes (including, where required, the explicit consent of the data subjects for the processing of any personal data (including special categories of personal data (as defined in applicable Data Protection Legislation)) for the Purposes set out in paragraph 4.1.34 above) and will make the list of "Purposes" for which Shore Capital, the Registrar and the Company Secretary will process the data (as set out in paragraph 4.1.36) of this Agreement) available to all data subjects whose personal data may be shared by it in the performance of this Agreement. For the purposes of this Part 16, "data subject", "data controller", "data processor", "personal data" and "sensitive personal data" shall have the meanings attributed to them in the Data Protection Legislation;

4.1.38 Shore Capital is entitled to exercise any of its rights under the Placing Agreement (including, without limitation, rights of termination) or any other right in its absolute discretion without any liability whatsoever to it;

4.1.39 the representations, undertakings and warranties contained in this Part 16 and, as applicable, in the Contract Note or Placing Confirmation and the Placing Letter (if any), are irrevocable. It acknowledges that Shore Capital and the Company and their respective affiliates will rely upon the truth and accuracy of the foregoing representations, warranties and undertakings and it agrees that if any of the representations or warranties or undertakings made or deemed to have been made by its subscription of the Ordinary Shares and/or C Shares under the Initial Placing and/or any Subsequent Placing are no longer accurate, it shall promptly notify Shore Capital and the Company;

135

4.1.40 where it or any person acting on behalf of it is dealing with Shore Capital, any money held in an account with Shore Capital on behalf of it and/or any person acting on behalf of it will not be treated as client money within the meaning of the relevant rules and regulations of the FCA which therefore will not require Shore Capital to segregate such money, as that money will be held by Shore Capital under a banking relationship and not as trustee;

4.1.41 any of its clients, whether or not identified to Shore Capital, will remain its sole responsibility and will not become clients of Shore Capital, for the purposes of the rules of the FCA or for the purposes of any other statutory or regulatory provision;

4.1.42 the allocation of Ordinary Shares or C Shares in respect of the Initial Placing and/or any Subsequent Placing shall be determined by Shore Capital in its absolute discretion (in consultation with the Company and the Investment Adviser) and that Shore Capital may scale back any Placing Commitment on such basis as Shore Capital may determine (which may not be the same for each Placee);

4.1.43 time shall be of the essence as regards its obligations to settle payment for the Ordinary Shares or C Shares subscribed under the Initial Placing and/or any Subsequent Placing and to comply with its other obligations under the Initial Placing and/or any Subsequent Placing;

4.1.44 it authorises Shore Capital to deduct from the total amount subscribed under the Initial Placing and/or any Subsequent Placing, as applicable, the aggregate commission (if any) (calculated at the rate agreed with the Placee) payable on the number of Ordinary Shares or C Shares allocated under the Initial Placing and/or any Subsequent Placing, as applicable;

4.1.45 in the event that a supplementary prospectus is required to be produced pursuant to Article 23(1) of the UK Prospectus Regulation and in the event that it chooses to exercise any right of withdrawal pursuant to Article 23(2) of the UK Prospectus Regulation, such Placee will immediately re-subscribe for the Ordinary Shares and/or C Shares previously comprising its Placing Commitment; and

4.1.46 the commitment to subscribe for Ordinary Shares and/or C Shares on the terms set out in this Part 16 and, as applicable, in the Contract Note or Placing Confirmation and the Placing Letter (if any) will continue notwithstanding any amendment that may in the future be made to the terms of the Initial Placing and/or any Subsequent Placing and that it will have no right to be consulted or require that its consent be obtained with respect to the Company's conduct of the Initial Placing or any Subsequent Placing.

The Company, the Investment Adviser, the Registrar and Shore Capital will rely upon the truth and accuracy of the foregoing representations, warranties, undertakings and acknowledgements. You agree to indemnify and hold each of the Company, the Investment Adviser, the Registrar and Shore Capital and their respective affiliates harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of any breach of the representations, warranties, undertakings, agreements and acknowledgements in this Part 16.

5. Purchase and Transfer Restrictions for U.S. Persons

5.1 By participating in the Initial Placing or any Subsequent Placing, each Placee located within the U.S. or is, or is acting for the account or benefit of, a U.S. Person, acknowledges and agrees that it will (for itself and any person(s) procured by it to subscribe for Ordinary Shares or C Shares and any nominee(s) for any such person(s)) be further deemed to acknowledge, understand, undertake, represent and warrant to each of the Company, the Investment Adviser, the Registrar and Shore Capital that:

5.1.1 it is a QJB, as defined in Rule 144A under the Securities Act, that is also a QP, as defined in Section 2(a)(51) of the Investment Company Act and has delivered to the Company and Shore Capital a signed Investor Representation Letter;

5.1.2 it confirms that: (i) it was not formed for the purpose of investing in the Company; and (ii) it is acquiring an interest in the Ordinary Shares or C Shares for its own account as principal, or for the account of one or more other persons who are able to and who shall be deemed to make all of the representations and agreements in this section 5 and in the Investor Representation Letter and for whom it exercises sole investment discretion;

136

5.1.3 it understands that the Ordinary Shares and any C Shares have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction of the United States and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. Persons absent registration except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act;

5.1.4 it acknowledges that the Company has not registered, and does not intend to register, as an investment company under the Investment Company Act and that the Company has put in place transfer and offering restrictions with respect to persons located in the United States and U.S. Persons described herein so that the Company will qualify for the exemption provided under Section 3(c)(7) of the Investment Company Act and to ensure that the Company will not be required to register as an investment company;

5.1.5 it will not be entitled to the benefits of the U.S. Investment Company Act;

5.1.6 it is knowledgeable, sophisticated and experienced in business and financial matters and it fully understands the limitations on ownership and transfer and the restrictions on sales of the Ordinary Shares or C Shares;

5.1.7 it is able to bear the economic risk of its investment in the Ordinary Shares and/or C Shares and is currently able to afford the complete loss of such investment and is aware that there are substantial risks incidental to the purchase of the Ordinary Shares, and/or C Shares including those summarised under the heading "Risk Factors" in this Prospectus;

5.1.8 unless the Company expressly consents in writing otherwise, no portion of the assets used to purchase, and no portion of the assets used to hold, the Ordinary Shares or C Shares or any beneficial interest therein constitutes or will constitute the assets of: (i) an "employee benefit plan" as defined in Section 3(3) of the United States Employee Retirement Income Security Act of 1974 as amended (for the purposes of this Part 14, "ERISA") that is subject to Title I of ERISA; (ii) a "plan" as defined in Section 4975 of the United States Internal Revenue Code of 1986, as amended (for the purposes of this Part 14, the "U.S. Internal Revenue Code"), including an individual retirement account or other arrangement that is subject to Section 4975 of the U.S. Internal Revenue Code; or (iii) an entity which is deemed to hold the assets of any of the foregoing types of plans, accounts or arrangements that is subject to Title I of ERISA or Section 4975 of the U.S. Internal Revenue Code. In addition, if a Placee is a governmental, church, non-U.S. or other employee benefit plan that is subject to any federal, state, local or non-U.S. law that is substantially similar to the provisions of Title I of ERISA or Section 4975 of the U.S. Internal Revenue Code, its purchase, holding, and disposition of the Ordinary Shares or C Shares must not constitute or result in a non-exempt violation of any such substantially similar law;

5.1.9 any Ordinary Shares or C Shares delivered to the Placee in certificated form will contain a legend substantially to the following effect unless otherwise determined by the Company in accordance with applicable law:

"THE SECURITY OF THE COMPANY REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES AND MAY NOT BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT AS PERMITTED BY THIS LEGEND. THE HOLDER HEREOF, BY ITS ACCEPTANCE OF THIS SECURITY, REPRESENTS, ACKNOWLEDGES AND AGREES THAT IT WILL NOT REOFFER, RESELL, PLEDGE OR OTHERWISE TRANSFER THIS SECURITY EXCEPT IN AN OFFSHORE TRANSACTION PURSUANT TO RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT ("REGULATION S") TO A PERSON OUTSIDE THE UNITED STATES AND NOT KNOWN BY THE TRANSFEROR TO BE A U.S. PERSON, IF EITHER (1) AT THE TIME THE BUY ORDER ORIGINATED THE TRANSFEREE WAS OUTSIDE THE UNITED STATES, OR THE TRANSFEROR AND ANY PERSON ACTING ON ITS BEHALF REASONABLY BELIEVED THE TRANSFEREE WAS OUTSIDE THE UNITED STATES OR (2) THE SALE IS MADE IN A TRANSACTION EXECUTED IN A DESIGNATED OFFSHORE SECURITIES MARKET, AND TO A PERSON NOT KNOWN TO THE TRANSFEROR TO BE A U.S. PERSON BY PRE-ARRANGEMENT OR OTHERWISE, AND UPON CERTIFICATION TO THAT EFFECT BY THE TRANSFEROR IN WRITING IN AN OFFSHORE TRANSACTION LETTER (IN THE FORM OF ANNEX I TO THE INVESTOR REPRESENTATION LETTER) OR ANOTHER FORM ACCEPTABLE TO THE ISSUER. THE

137

TERMS "US PERSON", "OFFSHORE TRANSACTION" AND "DESIGNATED OFFSHORE SECURITIES MARKET" HAVE THE MEANINGS SET FORTH IN REGULATION S. NIPPON ACTIVE VALUE FUND PLC HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE "INVESTMENT COMPANY ACT").

THE HOLDER OF THIS SECURITY AND ANY SUBSEQUENT TRANSFEREE WILL BE DEEMED TO REPRESENT, WARRANT AND AGREE THAT (I) IT IS NOT, AND IS NOT ACTING ON BEHALF OF, A BENEFIT PLAN INVESTOR UNLESS IT ACQUIRES THE SECURITY ON OR PRIOR TO ADMISSION WITH THE WRITTEN CONSENT OF THE COMPANY, AND (II) (A) IF IT IS, OR IS ACTING ON BEHALF OF, A BENEFIT PLAN INVESTOR, ITS ACQUISITION, HOLDING AND DISPOSITION OF SUCH SECURITY DOES NOT AND WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER THE UNITED STATES EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE UNITED STATES INTERNAL REVENUE CODE OF 1986 (THE "CODE") AND (B) IF IT IS A GOVERNMENTAL, CHURCH, NON-U.S. OR OTHER PLAN WHICH IS SUBJECT TO ANY FEDERAL, STATE, LOCAL OR NON-U.S. LAW THAT IS SIMILAR TO THE PROHIBITED TRANSACTION PROVISIONS OF SECTION 406 OF ERISA AND/OR SECTION 4975 OF THE CODE ("SIMILAR LAW"), (1) IT IS NOT, AND FOR SO LONG AS IT HOLDS SUCH SECURITY OR INTEREST THEREIN WILL NOT BE, SUBJECT TO ANY FEDERAL, STATE, LOCAL, NON-U.S. OR OTHER LAWS OR REGULATIONS THAT COULD CAUSE THE UNDERLYING ASSETS OF THE COMPANY TO BE TREATED AS ASSETS OF A SHAREHOLDER BY VIRTUE OF ITS INTEREST IN THE SECURITY AND THEREBY SUBJECT THE COMPANY (OR ANY PERSONS RESPONSIBLE FOR THE INVESTMENT AND OPERATION OF THE COMPANY'S ASSETS) TO ANY SIMILAR LAW AND (2) ITS ACQUISITION, HOLDING AND DISPOSITION OF SUCH SECURITY WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT VIOLATION OF ANY SIMILAR LAW AND (III) IT WILL AGREE TO CERTAIN TRANSFER RESTRICTIONS REGARDING ITS INTEREST IN SUCH SECURITIES. A "BENEFIT PLAN INVESTOR" MEANS (1) AN EMPLOYEE BENEFIT PLAN (AS DEFINED IN SECTION 3(3) OF ERISA), SUBJECT TO THE PROVISIONS OF PART 4 OF SUBTITLE B OF TITLE I OF ERISA, (2) A PLAN TO WHICH SECTION 4975 OF THE CODE APPLIES, OR (3) ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF SUCH EMPLOYEE BENEFIT PLAN'S OR PLAN'S INVESTMENT IN SUCH ENTITY;

5.1.10 if in the future the Placee decides to offer, sell, transfer, assign or otherwise dispose of the Ordinary Shares or C Shares, it will do so only to non-U.S. Persons in an offshore transaction in compliance with Regulation S, provided it executes an Offshore Transaction Letter, and under circumstances which will not require the Company to register under the U.S. Investment Company Act. It acknowledges that any sale, transfer, assignment, pledge or other disposal made other than in compliance with such laws and the above stated restrictions will be subject to the compulsory transfer provisions as provided in the Articles (as amended from time to time);

5.1.11 the Company reserves the right to make inquiries of any holder of the Ordinary Shares and/or the C Shares or interests therein at any time as to such person's status under the U.S. federal securities laws and to require any such person that has not satisfied the Company that holding by such person will not violate or require registration under the U.S. securities laws to transfer such Ordinary Shares and/or C Shares, or interests in accordance with the Articles (as amended from time to time);

5.1.12 the Company is required to comply with FATCA and any regulations made thereunder or associated therewith and that the Company will follow FATCA's extensive reporting and withholding requirements. The Placee agrees to furnish any information and documents which the Company may from time to time request, including but not limited to information required under FATCA;

5.1.13 it is entitled to acquire the Ordinary Shares and/or C Shares, under the laws of all relevant jurisdictions which apply to it, it has fully observed all such laws and obtained all governmental and other consents which may be required thereunder and complied with all necessary formalities and it has paid all issue, transfer or other taxes due in connection with its acceptance in any jurisdiction of the Ordinary Shares and/or C Shares and that it has not taken any action, or omitted to take any action, which may result in the Company, the Investment Adviser, the Registrar, Shore Capital or their respective directors, officers, agents, employees and advisers being in breach of the laws of any jurisdiction in connection with the Issue or its acceptance of participation in the Initial Placing and/or any Subsequent Placing;

138

5.1.14 it has received, carefully read and understands this Prospectus (and any supplementary prospectus issued by the Company), and has not, directly or indirectly, distributed, forwarded, transferred or otherwise transmitted this Prospectus (and any supplementary prospectus issued by the Company) or any other presentation or offering materials concerning the Ordinary Shares and/or the C Shares to or within the United States or to any U.S. Persons, nor will it do any of the foregoing; and

5.1.15 it understands that this Prospectus (and any supplementary prospectus issued by the Company) has been prepared according to the disclosure requirements of the United Kingdom, which are different from those of the United States.

6. Supply and Disclosure of Information

If Shore Capital, the Registrar or the Company or any of their agents request any information about a Placee's agreement to subscribe for Ordinary Shares or C Shares under the Initial Placing and/or any Subsequent Placing, such Placee must promptly disclose it to them and ensure that such information is complete and accurate in all respects.

7. Miscellaneous

The rights and remedies of Shore Capital, the Registrar, the Investment Adviser and the Company under these terms and conditions are in addition to any rights and remedies which would otherwise be available to each of them and the exercise or partial exercise of one will not prevent the exercise of others.

On application, if a Placee is an individual, that Placee may be asked to disclose in writing or orally, his nationality. If a Placee is a discretionary fund manager, that Placee may be asked to disclose in writing or orally the jurisdiction in which its funds are managed or owned. All documents provided in connection with the Initial Placing and/or any subsequent Placing will be sent at the Placee's risk. They may be sent by post to such Placee at an address notified by such Placee to Shore Capital.

Each Placee agrees to be bound by the Articles (as amended from time to time) once the Ordinary Shares or C Shares, as applicable, which the Placee has agreed to subscribe for pursuant to the Initial Placing and/or any Subsequent Placing, have been acquired by the Placee. The contract to subscribe for Ordinary Shares or C Shares under the Initial Placing and/or any Subsequent Placing and the appointments and authorities mentioned in this Prospectus and all disputes and claims arising out of or in connection with its subject matter or formations (including non-contractual disputes or claims) will be governed by, and construed in accordance with, the laws of England and Wales. For the exclusive benefit of Shore Capital, the Company, the Investment Adviser and the Registrar, each Placee irrevocably submits to the jurisdiction of the courts of England and Wales and waives any objection to proceedings in any such court on the ground of venue or on the ground that proceedings have been brought in an inconvenient forum. This does not prevent an action being taken against a Placee in any other jurisdiction.

In the case of a joint agreement to subscribe for Ordinary Shares or C Shares under the Initial Placing and/or any Subsequent Placing, references to a "Placee" in these terms and conditions are to each of the Placees who are a party to that joint agreement and their liability is joint and several.

Shore Capital and the Company expressly reserve the right to modify the Initial Placing and/or any Subsequent Placing (including, without limitation, its timetable and settlement) at any time before allocations are determined. The Initial Placing and/or any Subsequent Placing are subject to the satisfaction of the conditions contained in the Placing Agreement and to the Placing Agreement not having been terminated. Further details of the terms of the Placing Agreement are contained in Part 14 of this Prospectus.

139

PART 17

TERMS AND CONDITIONS OF APPLICATION UNDER THE OFFER FOR SUBSCRIPTION

Introduction

If you apply for New Shares under the Offer for Subscription, you will be agreeing with the Company, Shore Capital, the Registrar and the Receiving Agent as set out in this Part 17.

Terms and conditions for Applicants using the Offer for Subscription Application Form

2.1 Offer to acquire New Shares under the Offer for Subscription

Your application must be made on the Application Form set out at the Appendix to this Prospectus or as may be otherwise published by the Company. By completing and delivering an Application Form, you, as the applicant, and, if you complete and sign an Application Form on behalf of another person or a corporation, that person or corporation:

(a) offer to subscribe for the New Shares for the aggregate price specified in section 1 of your Application Form (being a minimum of £5,000 or such lesser number for which your application is accepted, and thereafter in multiples of £1.00) at the Issue Price per New Share on the terms, and subject to the conditions, set out in this Prospectus (including this Part 17) and the Articles;

(b) agree that in respect of any New Shares for which you wish to subscribe under the Offer for Subscription you will submit payment in Sterling;

(c) agree that, in consideration of the Company and Shore Capital agreeing that they will not, prior to First Admission, offer for subscription any New Shares to any person other than by means of the procedures referred to in this Prospectus, your application may not be revoked (subject to any legal right to withdraw your application which arises as a result of (i) in the case of an issue of Ordinary Shares, the announcement of the Issue Price, or (ii) any supplementary prospectus being published by the Company subsequent to the date of this Prospectus and prior to First Admission) and that this paragraph (c) shall constitute a collateral contract between you, the Company and Shore Capital which will become binding upon despatch by post to or, in the case of delivery by hand, on receipt by the Receiving Agent of your Application Form;

(d) undertake to pay the amount specified in section 1 of your Application Form in full on application and warrant that the remittance accompanying your Application Form will be honoured on first presentation and agree that if such remittance is not so honoured you will not be entitled to have any New Shares applied for in uncertificated form credited to a CREST account or to receive a share certificate for any New Shares applied for in certificated form or to enjoy or receive any rights in respect of such New Shares unless and until you make payment in cleared funds for such New Shares and such payment is accepted by the Receiving Agent (which acceptance shall not constitute an acceptance of your offer under the Offer for Subscription and shall be in its absolute discretion and on the basis that you indemnify the Company and the Receiving Agent against all costs, damages, losses, expenses and liabilities arising out of or in connection with the failure of your remittance to be honoured on first presentation) and the Company may (without prejudice to any other rights it may have) void the agreement to allot such New Shares and may allot them to some other person(s), in which case you will not be entitled to any refund or payment in respect thereof (other than the refund to you at your risk of any proceeds of the remittance, once honoured, which accompanied your Application Form, without interest);

(e) agree that the crediting to a CREST account of any New Shares in uncertificated form to which you may become entitled may be delayed by, and that any share certificate in respect of any New Shares in certificated form to which you or, in the case of joint applicants, any of the persons specified by you in your Application Form may become entitled and monies returnable may be retained by, the Receiving Agent:

(i) pending clearance of your remittance;

140

(ii) pending investigation of any suspected breach of the warranties contained in subparagraphs 2.6(a), 2.6(e), 2.6(g) or 2.6(h) of this Part 17 or any other suspected breach of the terms and conditions of application set out in this Part 17; or

(iii) pending any verification of identity which is, or which the Company, Shore Capital or the Receiving Agent considers may be, required for the purposes of their respective money laundering obligations under the Money Laundering Legislation and any other regulations applicable thereto,

and any interest accruing on such retained monies shall accrue to and for the sole benefit of the Company;

(f) agree, on the request of the Company, Shore Capital and/or the Receiving Agent, to disclose promptly in writing to them such information as the Company, Shore Capital and/or the Receiving Agent may request in connection with your application and authorise the Company, Shore Capital and the Receiving Agent to disclose any information relating to your application which they may consider appropriate;

(g) agree that, if evidence of identity satisfactory to the Company, and/or the Receiving Agent is not provided to the Receiving Agent within a reasonable time in the opinion of Shore Capital, the Receiving Agent or the Company following a request therefor, the Company or Shore Capital may terminate the agreement with you to allot New Shares and, in such case, the New Shares which would otherwise have been allotted to you may be re-allotted or sold to same other party and your application monies will be returned to the bank or other account on which the cheque or other remittance accompanying the application was drawn, or from which any electronic interbank transfer (CHAPS) was made, without interest and at your risk;

(h) agree that you are not applying on behalf of a person engaged in money laundering;

(i) undertake to ensure that, in the case of an Application Form signed by someone else on your behalf, the original of the relevant power of attorney (or a complete copy certificate by a solicitor or notary) is enclosed with your Application Form;

(j) undertake to pay interest at the rate described in paragraph 2.2(c) of this Part 17 if the remittance accompanying your Application Form is not honoured on first presentation;

(k) authorise the Receiving Agent to credit the CREST account specified in section 2B of the Application Form with the number of New Shares for which your application is accepted or, if that section is not completed, send a definitive certificate in respect of the number of New Shares for which your application is accepted by post to your address (or that of the first-named applicant) as set out in your Application Form;

(l) agree that, in the event of any difficulties or delays in the admission of the New Shares to CREST or the use of CREST in relation to the Issue, the Company and Shore Capital may agree that all of the Ordinary Shares should be issued in certificated form;

(m) authorise the Receiving Agent to send a crossed cheque for any monies returnable (without interest) by post to your address (or that of the first-named applicant) as set out in your Application Form at your risk;

(n) acknowledges that it has been informed that, pursuant to applicable data protection legislation (the "DP Legislation") the Company and/or the Registrar will following First Admission, hold personal data (as defined in the DP Legislation) relating to past and present Shareholders. Personal data, such as name, postal address and email address will be retained on record for a period exceeding five years after it is no longer used (subject to any limitations on retention periods set out in applicable law). The Registrar (acting as data processor of the Company) will process such personal data at all times in compliance with DP Legislation and shall only process for the purposes set out in the Company's privacy notice (the "Purposes") which is available for consultation on the Company's website at www.nipponactivevaluefund.com (the "Privacy Notice") which include to:

(i) process its personal data to the extent and in such manner as is necessary for the performance of its obligations under its service contract, including as required by or in

141

connection with its holding of New Shares, including processing personal data in connection with credit and anti-money laundering checks on it;

(ii) communicate with it as necessary in connection with its affairs and generally in connection with its holding of New Shares;
(iii) comply with the legal and regulatory obligations of the Company and/or the Registrar;
(iv) process its personal data for internal administration; and
(v) agree that your Application Form is addressed to the Company and Shore Capital.

2.2 Acceptance of Applications

(a) In respect of those New Shares for which your application has been received and is not rejected, acceptance of your application shall be constituted, at the election of the Company, or Shore Capital on behalf of the Company either:

(i) by notifying the London Stock Exchange of the basis of allocation (in which case the acceptance will be on that basis); or
(ii) by notifying acceptance thereof to the Receiving Agent.

(b) The basis of allocation will be determined by the Company in consultation with Shore Capital. The right is reserved notwithstanding the basis so determined to reject in whole or in part and/or scale down any application. The right is also reserved to treat as valid any application not complying fully with these Terms and Conditions of Application under the Offer for Subscription or not in all respects completed or delivered in accordance with the instructions accompanying the Application Form. In particular, but without limitation, the Company may accept an application made otherwise than by completion of an Application Form where you have agreed with it in some other manner to apply in accordance with the terms and conditions of application in this Part 17. The Company reserves the right (but shall not be obliged) to accept Application Forms and accompanying remittances which are received through the post after 1:00 p.m. on 18 November 2021.

(c) The right is reserved to present all cheques for payment on receipt by the Receiving Agent and to retain documents of title and surplus application monies pending clearance of successful applicant's cheques. The Company may require you to pay interest or its other resulting costs (or both) if any payment accompanying your application is not honoured on first presentation. If you are required to pay interest, you will be obliged to pay the amount determined by the Company to be the interest on the amount of the payment from the date on which the basis of allocation under the Offer for Subscription is publicly announced until the date of receipt of cleared funds. The rate of interest will be the then published bank base rate of a clearing bank selected by the Company plus two per cent. per annum.

(d) Multiple applications are liable to be rejected. All documents and remittances sent by post by or to an applicant (or as the applicant may direct) will be sent at the applicant's own risk.

(e) Payments must be made by cheque or banker's draft in Sterling drawn on a branch in the United Kingdom of a bank or building society that is either a member of the Cheque and Credit Clearing Company Limited or the CHAPS Clearing Company Limited or that has arranged for its cheques or bankers' drafts to be cleared through the facilities provided for members of either of those companies. Such cheques or bankers' drafts must bear the appropriate sort code in the top right hand corner. Cheques, which must be drawn on the personal account of an individual applicant where they have sole or joint title to the funds, should be made payable to "CIS PLC RE: NAVF OFS ACCOUNT" and crossed "A/C Payee". Third party cheques may not be accepted with the exception of building society cheques or bankers' drafts where the building society or bank has confirmed the name of the account holder by stamping or endorsing the cheque/banker's draft to such effect.

(f) Payment by CHAPS must be accompanied by a personalised payment reference number which may be obtained by contacting the Registrar directly by email at [email protected] for full bank details or telephone the Shareholder helpline for further information. The Registrar will then provide you with a unique reference number which must be used when sending payment.

142

(g) Applicants choosing to settle via CREST (i.e. by delivery versus payment (“DVP”)), will need to match their instructions to the Registrar’s participant account 3RA13 by no later than 1:00 p.m. on 18 November 2021, allowing for the delivery and acceptance of New Shares to be made against payment of the Issue Price, following the CREST matching criteria set out in the Application Form.

2.3 Conditions

The contracts created by the acceptance of applications (in whole or in part) under the Offer for Subscription will be conditional upon:

(a) First Admission occurring and becoming effective by 8:00 a.m. on 25 November 2021 (or such later time or date, not being later than 8:00 a.m. on 31 January 2022, as the Company and Shore Capital may agree); and

(b) the Placing Agreement referred to in paragraph 6.5 of Part 14 (General Information) of this Prospectus becoming unconditional and the obligations of Shore Capital thereunder not being terminated prior to First Admission.

2.4 Governing Law

(a) Unless otherwise stated, statements made in this Prospectus are based on the law and practice currently in force in England and Wales and are subject to changes therein.

(b) You will not be entitled to exercise any remedy of rescission for innocent misrepresentation (including pre-contractual representations) at any time after acceptance. This does not affect any other right you may have.

2.5 Return of application monies

If any application is not accepted in whole, or is accepted in part only (as a result of any scaling back of any part of an application) or as a result of the aggregate Issue Price payable for any Ordinary Shares not being divisible by £1, or if any contract created by acceptance does not become unconditional, the application monies or, as the case may be, the balance of the amount paid on application will be returned as soon as reasonably practicable without interest by returning your cheque, or by crossed cheque in favour of the first-named applicant, by post at the risk of the person(s) entitled thereto. In the meantime, application moneys will be retained by the Receiving Agent in a separate account.

2.6 Warranties

By completing an Application Form, you:

(a) warrant that, if you sign the Application Form on behalf of somebody else or on behalf of a corporation, you have due authority to do so on behalf of that other person or corporation and that such other person or corporation will be bound accordingly and will be deemed also to have given the confirmations, warranties and undertakings contained in this Part 17 and undertake to enclose your power of attorney or other authority or a complete copy thereof duly certified by a solicitor or notary;

(b) confirm that, in making an application, you are relying solely on this Prospectus and any supplementary prospectus issued by the Company prior to First Admission of the New Shares issued pursuant to the Issue and not on any other information given, or representation or statement made at any time, by any person concerning the Company, the New Shares and/or the Issue. You agree that none of the Company, the Investment Adviser, Shore Capital or the Registrar, nor any of their respective officers, agents employees, will have any liability for any other information or representation. You irrevocably and unconditionally waive any rights you may have in respect of any other information or representation;

(c) acknowledge that the Key Information Document prepared in relation to any C Shares pursuant to the UK PRIIPs Regulation (the “C Share KID”) can be provided to you in paper or by means of a website, but that where you are applying under the Offer for Subscription directly and not through an adviser or other intermediary, unless requested in writing otherwise, the lodging of an Application Form represents your consent to being provided the C Share KID via the website at www.nipponactivevaluefund.com, or on such other website as has been notified to you. Where

143

your application is made on an advised basis or through another intermediary, the terms of your engagement should address the means by which the C Share KID will be provided to you.

(d) agrees that, having had the opportunity to read the Prospectus, the Ordinary Shares KID and the C Share KID, it shall be deemed to have had notice of all information and representations concerning the Company, the Ordinary Shares and the C Shares contained therein;

(e) acknowledge that no person is authorised in connection with the Offer for Subscription to give any information or make any representation other than as contained in this Prospectus and any supplementary prospectus issued by the Company prior to First Admission of the New Shares issued pursuant to the Issue and, if given or made, any information or representation must not be relied upon as having been authorised by the Company, Shore Capital or the Investment Adviser;

(f) warrant that you are not under the age of 18 on the date of your application;

(g) agree that all documents and moneys sent by post to, by or on behalf of the Company, Shore Capital or the Receiving Agent will be sent at your risk and, in the case of documents and returned moneys to be sent to you, may be sent to you at your address (or, in the case of joint applicants, the address of the first-named applicant) as set out in your Application Form;

(h) warrant that you are not applying as, or as nominee or agent of, a person who is or may be a person mentioned in any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depository receipt and clearance services);

(i) acknowledge and understand that the Company may be required to comply with international regimes for the automatic exchange of information to improve the compliance (including FATCA and the CRS) and that the Company will comply with requirements to provide information to Her Majesty's Revenue & Customs tax authority which may be passed on to other relevant tax authorities. You agree to furnish any information and documents the Company may from time to time request, including but not limited to information required; and

(j) agree that you are capable, or the underlying client(s) in the case of applications on behalf of professionally-advised investors are capable themselves, of evaluating the merits and risks of an investment in the Company and have sufficient resources both to invest in potentially illiquid securities and to be able to bear any losses (which may equal the whole amount invested) that may result from the investment; and

(k) warrant that you, or your underlying client(s) in the case of applications on behalf of professionally- advised investors are, institutional, professional, professionally advised and knowledgeable investors who understand, or who have been advised of, the potential risk of investing in companies admitted to the Specialist Fund Segment.

2.7 Money laundering

You agree that, in order to ensure compliance with the Money Laundering Legislation and any other regulations applicable thereto the Company and/or the Receiving Agent may, at its/their absolute discretion, require verification of identity from any person lodging an Application Form who either:

(a) tenders payment by way of banker's draft or cheque or money order drawn on, or by way of telegraphic transfer or similar electronic means from, an account in the name of another person or persons (in which case verification of your identity may be required); or

(b) appears to the Receiving Agent to be acting on behalf of some other person (in which case verification of or identity of any persons on whose behalf you appear to be acting may be required).

Failure to provide the necessary evidence or identity may result in application(s) being rejected or delays in the despatch of documents or CREST accounts being credited.

Without prejudice to the generality of this Part 17, verification of the identity of applicants will be required if the value of the New Shares applied for, whether in one or more applications, exceeds EUR 15,000 (or the Sterling equivalent). If the amount you wish to subscribe for New Shares, whether in one

144

or more applications, exceeds EUR 15,000 (or the Sterling equivalent) you must ensure that section 6.A., 6.B., or 6.C. (as appropriate) of the Application Form is completed.

2.8 Overseas Investors

The attention of investors who are not resident in, or citizens of, countries other than the United Kingdom is drawn to paragraph (a) to (d) below:

(a) The offer of New Shares under the Offer for Subscription to persons who are resident in, or citizens of, countries other than the United Kingdom may be affected by the law of the relevant jurisdictions. Such persons should consult their professional advisers as to whether they require any government or other consents or need to observe any applicable legal requirements to enable them to subscribe for New Shares under the Offer for Subscription. It is the responsibility of all such persons receiving this Prospectus and/or wishing to subscribe for New Shares under the Offer for Subscription, to satisfy themselves as to full observance of the laws of any relevant territory or jurisdiction in connection therewith, including obtaining all necessary governmental or other consents that may be required and observing all other formalities requiring to be observed and paying any issue, transfer or other taxes due in such territories.

(b) No person receiving a copy of this Prospectus in any territory other than the United Kingdom may treat the same as constituting an offer or invitation to him, unless in the relevant territory such an offer can lawfully be made to him without compliance with any further registration or other legal requirements.

(c) Persons (including, without limitation, nominees and trustees) receiving this Prospectus should not distribute or send it to any U.S. Person or in or into the United States, Canada, Australia, the Republic of South Africa, the Republic of Ireland or Japan, their respective territories or possessions or any other jurisdiction where to do so would or might contravene local securities laws or regulations.

(d) The Company reserves the right to treat as invalid any agreement to subscribe for New Shares pursuant to the Offer for Subscription if it appears to the Company or its agents to have been entered into in a manner that may involve a breach of the securities legislation of any jurisdiction.

2.9 Miscellaneous

(a) To the extent permitted by law, all representations, warranties and conditions, express or implied and whether statutory or otherwise (including, without limitation, pre-contractual representations but excluding any fraudulent representations), are expressly excluded in relation to the New Shares and the Offer for Subscription.

(b) The rights and remedies of the Company, Shore Capital and the Receiving Agent, pursuant to this Part 17 are in addition to any rights and remedies, which would otherwise be available to any of them, and the exercise or partial exercise of one will not prevent the exercise of others.

(c) The Company reserves the right to delay the closing time of the Offer for Subscription from 1:00 p.m. on 18 November 2021 by giving notice to the London Stock Exchange. In this event, the revised closing time will be published in such manner as Shore Capital, in consultation with the Company, determines subject and having regard, to the Prospectus Regulation Rules and any requirements of the London Stock Exchange.

(d) The Company may terminate the Offer for Subscription in its absolute discretion at any time prior to First Admission of the New Shares issued under the Issue. If such right is exercised, the Offer for Subscription will lapse and any monies will be returned to you without interest.

(e) You agree that Shore Capital is acting for the Company in connection with the Issue and for no-one else and that Shore Capital will not treat you as its customer by virtue of such application being accepted or owe you any duties concerning the price of New Shares or concerning the suitability of New Shares for you or otherwise in relation to the Offer for Subscription.

(f) You authorise the Company, the Receiving Agent, Shore Capital or any person authorised any of them, as your agent, to do all things necessary to effect registration of any New Shares subscribed by you into your name(s) and authorise any representatives of the Company, the Receiving Agent or Shore Capital to execute and/or complete any document required therefor.

145

(g) You agree that all applications, acceptances of applications and contracts resulting therefrom under the Offer for Subscription and any non-contractual obligations arising under or in connection therewith shall be governed by and construed in accordance with English law and that you submit to the jurisdiction of the English courts and agree that nothing shall limit the right of the Company, Shore Capital or the Receiving Agent to bring any action, suit or proceedings arising out of or in connection with any such applications, acceptances and contracts in any other manner permitted by law or in any court of competent jurisdiction.

(h) The dates and times referred to in this Part 17 may be altered by the Company so as to be consistent with the Placing Agreement (as the same may be altered from time to time in accordance with its terms).

(i) Save where the context requires otherwise, terms used in this Part 17 bear the same meaning as where used elsewhere in this Prospectus.

2.10 Joint applicants

If you make a joint application, you will not be able to transfer your Shares into an ISA, SIPPS or SSAS. If you are interested in transferring your Shares into an ISA, SIPPS or SSAS, you should apply in your name only.

If you do wish to apply jointly, you may do so with up to three other persons. Sections 2 and 3 of the Application Form must be completed by one applicant. All other persons who wish to join in the application must complete and sign section 3 of the Application Form.

Another person may sign on behalf of any joint applicant if that other person is duly authorised to do so under a power of attorney. The original of the relevant power of attorney (or a complete copy certified by a solicitor or notary) must be enclosed for inspection. Certificates, cheques and other correspondence will be sent to the address set out in the first paragraph of the Application Form.

2.11 Contact telephone number

Insert in section 7 of the Application Form a daytime contact telephone number, including area code, (and, if different, from the person named in section 2 of the Application Form, the name of the person to contact) in the case of any queries regarding your application.

2.12 Verification of identity

Sections 5 and 6 of the Application Form only applies if the Shares which you are applying for, whether in one or more applications, exceeds EUR 15,000 (or the Sterling equivalent). If section 6 applies to your application, you must ensure that section 6.A., 6.B., 6.C. or 6.D. (as appropriate) is completed.

(a) Professional adviser or intermediary

You should complete section 5 of the Application Form if you are a stockbroker, bank manager, solicitor, accountant or other independent financial adviser authorised under FSMA or, if outside the United Kingdom, another appropriately authorised independent financial adviser acting on behalf of a client.

(b) Applicant identity information

Section 6.3 of the Application Form need only be completed where the amount you wish to subscribe for the C Shares, whether in one or more applications, exceeds EUR 15,000 (or the Sterling equivalent) and neither sections 6.1 nor 6.2 of the Application Form can be completed.

Notwithstanding that the declaration set out in section 6.2 of the Application Form has been completed and signed, the Receiving Agent, Shore Capital and the Company reserve the right to request of you the identity documents listed in section 6.3 of the Application Form and/or to seek verification of identity of each holder and payer (if necessary) from you or their bankers or from another reputable institution, agency or professional adviser in the applicable country of residence. If satisfactory evidence of identity has not been obtained within a reasonable time, your application might be rejected or revoked.

146

Where certified copies of documents are requested in section 6.3 of the Application Form, such copy documents should be certified by a senior signatory of a firm which is either a governmental approved bank, stockbroker or investment firm, financial services firm or an established law firm or accountancy firm which is itself subject to regulation in the conduct of its business in its own country of operation and the name of the firm should be clearly identified on each document certified.

2.13 Instructions for delivery of completed Application Forms

The completed Application Form should be returned, by post to Computershare, Corporate Actions Projects, Bristol BS99 6AH, so as to be received by no later than 1:00 p.m. on 18 November 2021. If you post your Application Form, you are recommended to use first class post and to allow at least two days for delivery. Application Forms received after 1:00 p.m. on 18 November 2021 may be rejected and returned to the first- named applicant.

147

148

APPLICATION FORM

NIPPON ACTIVE VALUE FUND PLC
(the "Company")

NOTES ON HOW TO COMPLETE THE APPLICATION FORM

All applicants must complete the Application Form.

Applications should be returned so as to be received no later than 1:00 p.m. (London time) on 18 November 2021.

HELP DESK: If you have a query concerning completion of the Application Form please call the Receiving Agent on 0370 707 1235 or from outside the UK on +44 370 707 1235.

1. APPLICATION

Fill in (in figures) in Box 1 the aggregate Issue Price of New Shares you wish to subscribe for at the Issue Price. Financial intermediaries who are investing on behalf of clients should make separate applications or, if making a single application for more than one client, provide details of all clients in respect of whom application is made.

2A. HOLDER DETAILS

Fill in (in block capitals) the full name and address of each holder. Applications may only be made by persons aged 18 or over. In the case of joint holders only the first named may bear a designation reference and the address given for the first named will be entered as the registered address for the holding on the share register and used for all future correspondence. A maximum of four joint holders is permitted. All holders named must sign the Application Form at section 3.

2B. CREST

If you wish your Shares to be deposited in a CREST account in the name of the holders given in section 2A enter in section 2B the details of that CREST account. Where it is requested that Shares be deposited into a CREST account please note that payment for such Shares must be made prior to the day such Shares might be allotted and issued. It is not possible for an applicant to request that Shares be deposited in their CREST account on an against payment basis. Any Application Form received containing such a request will be rejected.

3. SIGNATURE

All holders named in section 2A must sign section 3 and insert the date. The Application Form may be signed by another person on behalf of each holder if that person is duly authorised to do so under a power of attorney. The power of attorney (or a copy duly certified by a solicitor or a bank) must be enclosed for inspection (which originals will be returned by post at the addressee's risk). A corporation should sign under the hand of a duly authorised official whose representative capacity should be stated and a copy of a notice issued by the corporation authorising such person to sign should accompany the Application Form.

4. SETTLEMENT

4A. Cheque/Banker's Draft

Payments must be made by cheque or banker's draft in Sterling drawn on a branch in the United Kingdom of a bank or building society which is either a member of the Cheque and Credit Clearing Company Limited or the CHAPS Clearing Company Limited or which has arranged for its cheques or banker's drafts to be cleared through the facilities provided for members of any of these companies. Such cheques or banker's drafts must bear the appropriate sort code in the top right hand corner. Cheques, which must be drawn on the personal account of the individual investor where they have a sole or joint title to the funds should be made payable to "CIS PLC RE: NAVF OFS ACCOUNT" and crossed "A/C Payee". Third party cheques may not be accepted with the exception of building society cheques or banker's drafts where the building society or bank has confirmed the name of the account holder by stamping and endorsing the cheque/banker's draft to such effect.

The account name should be the same as that shown on the application.

4B. Electronic Bank Transfers

For applicants sending subscription monies by electronic bank transfer (CHAPS), payment must be made for value by no later than 1:00 p.m. on 18 November 2021. Applicants wishing to make a CHAPS payment should contact the Registrar by email at [email protected] for full bank details. Applicants will be provided with a unique reference number which must be used when making the payment.

4C. CREST Settlement

The Company will apply for the Shares issued pursuant to the Offer for Subscription in uncertificated form to be enabled for CREST transfer and settlement with effect from First Admission (the "Settlement Date"). Accordingly, settlement of transactions in the Shares will normally take place within the CREST system.

The Application Form in the Appendix contains details of the information which the Receiving Agent will require from you in order to settle your application within CREST, if you so choose. If you do not provide any CREST details or if you provide insufficient CREST details for the Receiving Agent to match to your CREST account, the Receiving Agent will deliver your Shares in certificated form provided payment has been made in terms satisfactory to the Company.

The right is reserved to issue your Shares in certificated form should the Company, having consulted with the Receiving Agent, consider this to be necessary or desirable. This right is only likely to be exercised in the event of any interruption, failure or breakdown of CREST or any part of CREST or on the part of the facilities and/or system operated by the Receiving Agent in connection with CREST.

The person named for registration purposes in your Application Form (which term shall include the holder of the relevant CREST account) must be: (i) the person procured by you to subscribe for or acquire the relevant Shares; or (ii) yourself; or (iii) a nominee of any such person or yourself, as the case may be. Neither the Receiving Agent nor the Company will be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe this requirement. The Receiving Agent, on behalf of the Company, will input a DVP instruction into the CREST system according to the booking instructions provided by you in your Application Form. The input returned by you or your settlement agent/custodian of a matching or acceptance instruction to our CREST input will then allow the delivery of your Shares to your CREST account against payment of the Issue Price per Share through the CREST system upon the Settlement Date.

By returning the Application Form you agree that you will do all things necessary following the Company's announcement on or around 12 November 2021 as to whether the Company decides to issue Ordinary Shares of C Shares pursuant to the issue to ensure that you or your settlement agent/custodian's CREST account allows for the delivery and acceptance of Shares to be made prior to 8:00 a.m. on 25 November 2021 against payment of the Issue Price per Share. Failure by you to do so will result in you being charged interest at a rate equal to the London Inter-Bank Offered Rate for seven day deposits in sterling plus two per cent. per annum.

To ensure that you fulfil this requirement it is essential that you or your settlement agent/custodian follow the CREST matching criteria set out below:

Trade Date:	23 November 2021
Settlement Date:	25 November 2021
Company:	Nippon Active Value Fund plc
Security Description:	C Shares of £0.10 each/Ordinary Shares of £0.01 each
ISIN	GB00BKLGLT27/GB00BKLGLS10
SEDOL::	BKLGLT2/BKLGLS1

Should you wish to settle DVP, you will need to match your instructions to the Registrar's Participant account 3RA13 by no later than 1:00 p.m. on 18 November 2021.

You must also ensure that you or your settlement agent/custodian has a sufficient "debit cap" within the CREST system to facilitate settlement in addition to your/its own daily trading and settlement requirements.

149

In the event of late CREST settlement, the Company, after having consulted with the Registrar, reserves the right to deliver Shares outside CREST in certificated form provided payment has been made in terms satisfactory to the Company and all other conditions in relation to the Offer for Subscription have been satisfied.

5. RELIABLE INTRODUCER DECLARATION

Applications will be subject to the UK's verification of identity requirements. This will involve you providing the verification of identity documents listed in section 6 of the Application Form UNLESS you can have the declaration provided at section 5 of the Application Form given and signed by a firm acceptable to the Receiving Agent. In order to ensure your application is processed timely and efficiently all applicants are strongly advised to have the declaration provided in section 5 of the Application Form completed and signed by a suitable firm.

6. IDENTITY INFORMATION

Applicants need only consider section 6 of the Application Form if the declaration in section 5 cannot be completed. Notwithstanding that the declaration in section 5 has been completed and signed the Receiving Agent reserves the right to request of you the identity documents listed in section 6 and/or to seek verification of identity of each holder and payor (if necessary) from you or their bankers or from another reputable institution, agency or professional adviser in the applicable country of residence. If satisfactory evidence of identity has not been obtained within a reasonable time your application might be rejected or revoked. Where certified copies of documents are provided such copy documents should be certified by a senior signatory of a firm which is either a governmental approved bank, stockbroker or investment firm, financial services firm or an established law firm or accountancy firm which is itself subject to regulation in the conduct of its business in its own country of operation and the name of the firm should be clearly identified on each document certified.

7. CONTACT DETAILS

To ensure the efficient and timely processing of your Application Form, please provide contact details of a person the Receiving Agent may contact with all enquiries concerning your application. Ordinarily this contact person should be the person signing in section 3 on behalf of the first named holder. If no details are provided here but a regulated person is identified in section 5, the Receiving Agent will contact the regulated person. If no details are entered here and no regulated person is named in section 5 and the Receiving Agent requires further information, any delay in obtaining that additional information may result in your application being rejected or revoked.

INSTRUCTIONS FOR DELIVERY OF COMPLETED APPLICATION FORMS

Completed Application Forms should be returned, by post to Computershare, Corporate Actions Projects, Bristol BS99 6AH so as to be received no later than 1:00 p.m. on 18 November 2021, together with payment in full in respect of the application. If you post your Application Form you are recommended to use first class post and to allow at least two days for delivery. Application Forms received after this date may be returned.

Scanned Applications Forms in advance of originals will be accepted and should be emailed to: [email protected].

150

APPENDIX 1

OFFER FOR SUBSCRIPTION APPLICATION FORM

Please send this completed form by post to Computershare Investor Services PLC, Corporate Actions Projects, The Pavilions, Bridgwater Road, Bristol BS99 6AH so as to be received no later than 1:00 p.m. (London time) on 18 November 2021. Scanned copies emailed to: [email protected] will be accepted in advance of originals by post.

The Directors may, with the prior approval of Shore Capital, alter such date and thereby shorten or lengthen the offer period. In the event that the offer period is altered, the Company will notify investors of such change.

Important: Before completing this form, you should read the Prospectus dated 28 October 2021 and the Terms and Conditions of Application under the Offer for Subscription set out in the Prospectus and accompanying notes to this form.

To: Nippon Active Value Fund plc and the Receiving Agent

| FOR OFFICIAL USE ONLY
Log No. |
| --- |
| Box 1 |
| --- |
| £ _______ |

1. APPLICATION

I/We the person(s) detailed in section 2A below offer to subscribe the amount shown in Box 1 (above) for New Shares subject to the Terms and Conditions of Application under the Offer for Subscription set out in the Prospectus dated 28 October 2021 and subject to the articles of association of the Company in force from time-to-time.

2A. DETAILS OF HOLDER(S) IN WHOSE NAME(S) SHARES WILL BE ISSUED

(BLOCK CAPITALS)

1	Mr, Mrs, Ms or Title:	Forenames (in full):
Surname/Company name:
Address (in full):
Postcode:	Designation (if any):
2	Mr, Mrs, Ms or Title:	Forenames (in full):
---	---	---
Surname/Company name:
Address (in full):
Postcode:	Designation (if any):

152

3 Mr, Mrs, Ms or Title: Forenames (in full):

Surname/Company name:

Address (in full):

Postcode: Designation (if any):

4 Mr, Mrs, Ms or Title: Forenames (in full):

Surname/Company name:

Address (in full):

Postcode: Designation (if any):

2B. CREST ACCOUNT DETAILS INTO WHICH NEW SHARES ARE TO BE DEPOSITED (IF APPLICABLE)

Only complete this section if New Shares allotted are to be deposited in a CREST Account which must be in the same name as the holder(s) given in Section 2A.

(BLOCK CAPITALS)

CREST Participant ID:

CREST Member Account ID:

SIGNATURE(S): ALL HOLDERS MUST SIGN

By completing box 3 below you are deemed to have read the Prospectus and agreed to the terms and conditions in Part 17 (Terms and Conditions of Application under the Offer for Subscription) of the Prospectus and to have given the warranties, representations and undertakings set out therein.

First Applicant Signature:	Date:
Second Applicant Signature:	Date:
Third Applicant Signature:	Date:
Fourth Applicant Signature:	Date:

Execution by a Company

Executed by (Name of Company):		Date:
Name of Director:	Signature:	Date:
Name of Director/Secretary:	Signature:	Date:
If you are affixing a company seal, please mark a cross:	Affix Company Seal here:

4. SETTLEMENT

Please tick the relevant box confirming your method of payment

4A. CHEQUES/BANKERS' DRAFT

If you are subscribing for New Shares and paying by cheque or banker's draft, pin or staple to this form your cheque or banker's draft for the number of New Shares shown in Box 1 made payable to "CIS PLC: re NAVF PLC" and crossed "A/C Payee". Cheques and banker's payments must be drawn in sterling on an account at a bank branch in the United Kingdom and must bear a United Kingdom bank sort code number in the top right hand corner. If you use a banker's draft or a building society cheque you should ensure that the bank or building society issuing the payment enters the name, address and account number of the person whose account is being debited on the reverse of the banker's draft or cheque and adds its stamp.

4B. ELECTRONIC BANK TRANSFER

If you are subscribing for New Shares and sending subscription monies by electronic bank transfer

(CHAPS), payment must be made for value by 1:00 p.m. on 18 November 2021. Please contact Computershare Investor Services PLC by email at [email protected] for full bank details. You will be provided with a unique reference number which must be used when making the payment.

Please enter below the sort code of the bank and branch you will be instructing to make such payment for value by 1:00 p.m. on 18 November 2021, together with the name and number of the account to be debited with such payment and the branch contact details.

Sort Code:	Account Number:
Account Name:	Bank Name and Address:

4C. SETTLEMENT BY DELIVERY VERSUS. PAYMENT (DVP)

Only complete this section if you choose to settle your application within CREST, that is delivery versus payment (DVP).

Please indicate the CREST Participant ID from which the DEL message will be received by the Receiving Agent for matching, which should match that shown in 2B above, together with the relevant Member Account ID.

(BLOCK CAPITALS)

CREST Participant ID:

CREST Member Account ID:

You or your settlement agent/custodian's CREST account must allow for the delivery and acceptance of Shares to be made against payment at the Issue Price per Share, following the CREST matching criteria set below as appropriate following the Company's announcement on or around 12 November 2021 as to whether the Company has decided to issue Ordinary Shares or C Shares pursuant to the Issue:

Trade Date: 23 November 2021
Settlement Date: 25 November 2021
Company: Nippon Active Value Fund PLC
Security Description: C Shares of £0.10 each/Ordinary Shares of £0.01 each
ISIN: GB00BKLGLT27/GB00BKLGLS10
SEDOL: BKLGLT2/BKLGLS1

Should you wish to settle DVP, you will need to match your instructions to Computershare's Participant account 3RA13 by no later than 1:00 p.m. on 18 November 2021.

You must also ensure that you or your settlement agent/custodian have a sufficient "debit cap" within the CREST system to facilitate settlement in addition to your/their own daily trading and settlement requirements.

RELIABLE INTRODUCER DECLARATION

Completion and signing of this declaration by a suitable person or institution may avoid presentation being requested of the identity documents detailed in section 6 of this form.

The declaration below may only be signed by a person or institution (such as a governmental approved bank, stockbroker or investment firm, financial services firm or an established law firm or accountancy firm) (the "firm") which is itself subject in its own country to operation of 'know your customer' and anti-money laundering regulations no less stringent than those which prevail in the United Kingdom.

DECLARATION:

To the Company and the Receiving Agent

With reference to the holder(s) detailed in section 2A, all persons signing at section 3 and the payor identified in section 6 if not also a holder (collectively the "subjects") WE HEREBY DECLARE:

we operate in the United Kingdom, or in a country where money laundering regulations under the laws of that country are, to the best of our knowledge, no less stringent than those which prevail in the United Kingdom and our firm is subject to such regulations;
we are regulated in the conduct of our business and in the prevention of money laundering by the regulatory authority identified below;
each of the subjects is known to us in a business capacity and we have undertaken identity checks on each of them within the last two years and we undertake to immediately provide to you copies of such checks on demand;
we confirm the accuracy of the names and residential business address(es) of the holder(s) given at section 2A;

154

having regard to all local money laundering regulations we are, after enquiry, satisfied as to the source and legitimacy of the monies being used to subscribe for the Ordinary Shares mentioned; and
where the payor and holder(s) are different persons we are satisfied as to the relationship between them and reason for the payor being different to the holder(s).

The above information is given in strict confidence for your own use only and without any guarantee, responsibility or liability on the part of this firm or its officials.

Signed:
Name:
Position:

Name of regulatory authority:
Firm's licence number:

Website address or telephone number of regulatory authority:

STAMP of firm giving full name and business address:

6. IDENTITY INFORMATION

If the declaration in section 5 cannot be signed and the value of your application is greater than €15,000 (or the sterling equivalent), please enclose with that Application Form the documents mentioned below, as appropriate. Please also tick the relevant box to indicate which documents you have enclosed, all of which will be returned by the Receiving Agent to the first named Applicant.

In accordance with internationally recognised standards for the prevention of money laundering, the documents and information set out below must be provided:

Holders				Payor

Tick here for documents provided

A. For each holder being an individual enclose:

(1) an original or a certified clear photocopy of one of the following identification documents which bear both a photograph and the signature of the person: current passport – Government or Armed Forces identity card – driving licence; and
(2) an original or certified copies of at least two of the following documents no more than 3 months old which purport to confirm that the address given in section 2A is that person's residential address: a recent gas, electricity, water or telephone (not mobile) bill – a recent bank statement – a council rates bill – or similar document issued by a recognised authority; and



---	---	---	---	---

(3) if none of the above documents show their date and place of birth, enclose a note of such information; and

(4) details of the name and address of their personal bankers from which the Receiving Agent may request a reference, if necessary.

B. For each holder being a company (a "holder company") enclose:

(1) a certified copy of the certificate of incorporation of the holder company; and

(2) the name and address of the holder company's principal bankers from which the Receiving Agent may request a reference, if necessary; and

(3) a statement as to the nature of the holder company's business, signed by a director; and

(4) a list of the names and residential addresses of each director of the holder company; and

(5) for each director provide documents and information similar to that mentioned in A above; and

(6) a copy of the authorised signatory list for the holder company; and

(7) a list of the names and residential/registered address of each ultimate beneficial owner interested in more than 5 per cent. of the issued share capital of the holder company and, where a person is named, also complete C below and, if another company is named (hereinafter a "beneficiary company"), also complete D below. If the beneficial owner(s) named do not directly own the holder company but do so indirectly via nominee(s) or intermediary entities, provide details of the relationship between the beneficial owner(s) and the holder company.

C. For each person named in B(7) as a beneficial owner of a holder company enclose for each such person documents and information similar to that mentioned in A(1) to (4).

D. For each beneficiary company named in B(7) as a beneficial owner of a holder company enclose:

(1) a certified copy of the certificate of incorporation of that beneficiary company; and

(2) a statement as to the nature of that beneficiary company's business signed by a director; and



---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

156

(3) the name and address of that beneficiary company's principal bankers from which the Receiving Agent may request a reference, if necessary; and
(4) a list of the names and residential/registered address of each beneficial owner owning more than 5 per cent. of the issued share capital of that beneficiary company.

E. If the payor is not a holder and is not a bank providing its own cheque or banker's payment on the reverse of which is shown details of the account being debited with such payment (see note 5 on how to complete this form) enclose:

(1) if the payor is a person, for that person the documents mentioned in A(1) to (4); or
(2) if the payor is a company, for that company the documents mentioned in B(1) to (7); and
(3) an explanation of the relationship between the payor and the holder(s).

The Receiving Agent reserves the right to ask for additional documents and information.

CONTACT DETAILS

To ensure the efficient and timely processing of this application please enter below the contact details of a person the Receiving Agent may contact with all enquiries concerning this application. Ordinarily this contact person should be the person signing in section 3 on behalf of the first named holder. If no details are provided here but a regulated person is identified in section 5, the Receiving Agent will contact the regulated person. If no details are entered here and no regulated person is named in section 5 and the Receiving Agent requires further information, any delay in obtaining that additional information may result in your application being rejected or revoked.

Contact name:	E-mail address:
Contact address:
	Postcode:
Telephone No:	Fax No:

APPENDIX 2 GIPS DALTON JAPAN LONG ONLY PRESENTATION

Year	Gross-of-Fees Return* (%)	Benchmark Return (%)	Composite 3-Yr St Dev (%)	Benchmark 3-Yr St Dev (%)	Number of Portfolios	Internal Dispersion (%)	Total Composite Assets (JPY)	Total Composite Assets (USD)	Total Firm Assets (JPY)	Total Firm Assets (USD)
1996	-2.03%	-11.46%	N/A	N/A	1	N/A	2.2B	19.1M	N/A	N/A
1997	-1.15%	-14.00%	N/A	N/A	1	N/A	2.3B	17.6M	N/A	N/A
1998	-0.22%	-8.61%	N/A	N/A	1	N/A	2.3B	20.5M	N/A	N/A
1999	95.88%	45.38%	23.89%	19.01%	1	N/A	6.3B	61.2M	8.6B	0.1B
2000	-13.82%	-19.48%	24.45%	18.37%	1	N/A	6.3B	54.9M	15.0B	0.1B
2001	-12.15%	-18.96%	25.41%	17.19%	1	N/A	7.1B	53.9M	15.5B	0.1B
2002	-27.32%	-19.00%	22.32%	15.12%	1	N/A	6.8B	57.5M	18.7B	0.2B
2003	25.92%	23.01%	22.63%	16.41%	1	N/A	14.4B	133.9M	32.1B	0.3B
2004	15.67%	10.51%	17.36%	15.38%	2	N/A	24.5B	238.7M	73.1B	0.7B
2005	48.84%	44.45%	13.34%	14.39%	4	N/A	52.3B	444.2M	133.2B	1.1B
2006	6.60%	7.24%	13.06%	13.83%	5	N/A	59.2B	497.3M	113.7B	1.0B
2007	-15.00%	-10.10%	13.06%	13.80%	6	N/A	57.3B	512.5M	120.8B	1.1B
2008	-36.90%	-42.51%	20.08%	19.89%	5	N/A	30.5B	337.0M	61.0B	0.7B
2009	7.87%	9.00%	22.47%	21.79%	3	N/A	23.6B	253.8M	67.8B	0.7B
2010	16.70%	0.63%	24.83%	23.75%	3	N/A	17.3B	213.0M	84.0B	1.0B
2011	-3.35%	-18.76%	17.95%	17.46%	3	N/A	20.8B	271.0M	108.5B	1.4B
2012	25.13%	21.71%	15.72%	18.93%	4	N/A	33.7B	388.9M	158.6B	1.8B
2013	73.54%	54.53%	15.91%	19.11%	5	N/A	62.4B	592.2M	269.2B	2.6B
2014	15.99%	9.27%	15.08%	17.85%	5	N/A	79.4B	663.1M	376.8B	3.1B
2015	24.10%	9.90%	14.98%	16.80%	5	N/A	87.5B	727.8M	389.9B	3.2B
2016	3.82%	-0.66%	15.52%	17.08%	3	N/A	91.2B	779.9M	365.8B	3.1B
2017	24.62%	19.67%	14.93%	16.04%	4	N/A	118.8B	1.1B	421.9B	3.7B
2018	-15.96%	-15.14%	16.81%	14.93%	9	N/A	126.6B	1.2B	383.9B	3.5B
2019	19.01%	18.43%	14.12%	12.38%	11	2.86%	169.9B	1.6B	365.0B	3.4B
2020	7.97%	8.92%	17.91%	16.76%	12	3.41%	187.7B	1.8B	334.9B	3.2B

Gross-of-fees returns for the period between July 1, 1996 and July 31, 2004 are actually net-of-fees returns, presented due to an older accounting system. Inclusion of these fees in the gross-of-fees returns brings these returns lower than the actual gross of-fees returns.
Dalton Investments LLC and Dalton Investments, Inc. (collectively, "Dalton Investments" or the "Firm") are investment advisers registered with the United States Securities and Exchange Commission ("SEC"). The Global Investment Performance Standards ("GIPS®") definition of the Firm excludes: (i) Dalton Investments' affiliates, such as Rosenwald Capital Management, Inc., (ii) its non-core real estate investment mandates and (iii) its closed, private client, high net-worth business.
Dalton Investments claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in compliance with the GIPS standards. Dalton Investments has been independently verified for the periods 01/01/2010 – 31/12/2020. A firm that claims compliance with the GIPS standards must establish policies and procedures for complying with all the applicable requirements of the GIPS standards. Verification provides assurance on whether the firm's policies and procedures related to composite and pooled fund maintenance, as well as the calculation, presentation, and distribution of performance, have been designed in compliance with the GIPS standards and have been implemented on a firm-wide basis. The Dalton Japan Long Only Composite (the "Composite") has had a performance examination for the periods 01/01/2010 – 31/12/2020. The Firm's list of pooled fund descriptions for limited distribution pooled funds is available upon request. Policies for valuing investments, calculating performance, and preparing GIPS Reports are available upon request. The verification and performance examination reports are available upon request. The Firm's list of composite descriptions is available upon request.
The Composite's inception date was July 1, 1996 and contains all discretionary portfolio accounts managed within the Dalton Japan Long Only strategy. The Composite's strategy seeks to follow a disciplined value investment process to identify intrinsically undervalued Japanese companies or companies that derive substantial revenue from Japan. The Composite's strategy invests primarily in local ordinary shares and for Composite accounts that permit currency trading, certain currency instruments. The Composite's strategy typically does not permit use of leverage including derivatives or shorts. Illiquid securities are not a significant part of this Composite strategy. The Composite was created in December 2014.

The Composite's benchmark is the MSCI Daily Total Return Net Japan Index (MSCI Japan (JPY), symbol: NDDUJN) (the "Benchmark") and is compiled by Morgan Stanley Capital International, Inc. It is a total return, free float-adjusted, capitalization-weighted index that is designed to track the performance of Japanese securities listed on the Tokyo Stock Exchange, Osaka Stock Exchange, JASDAQ and Nagoya Stock Exchange. Net total return indices reinvest dividends after the deduction of withholding taxes, using (for international indices) a tax rate applicable to non-resident institutional investors who do not benefit from double taxation treaties. For comparison purposes, Benchmark returns do not reflect transaction costs, investment management fees or other fees and expenses that would reduce performance in an actual account. It is not possible to invest in the Benchmark. The Composite's portfolio accounts have held and are expected to continue to hold securities that are not included in the Benchmark and the Firm makes no representations that any account in the Composite is comparable to the Benchmark in composition or element of risk involved. Benchmark returns are not covered by the report of the independent verifiers.
Composite and Benchmark performance presented is calculated on a total return basis, which includes the reinvestment of all income, plus realized and unrealized gains/losses, if applicable. Individual portfolio account returns within the Composite may vary substantially for such factors including, among others, account specific restrictions – e.g., whether currency investments are permitted, timing of transactions, contributions, withdrawals, and market conditions at the time of investment. Performance is expressed in Japanese Yen and is presented net of estimated foreign withholding taxes on dividends, which vary amongst the Composite's portfolio accounts. To compute currency exchange rates, the Composite uses Bloomberg at 4PM EST close while the Benchmark uses WM Reuters at 4PM GMT close, which may result in differing exchange rates. For partial year periods, partial period Benchmark returns are used.
Gross-of-fees returns for the Composite are presented before management and performance fees, but after all trading expenses, withholding taxes and custodial fees (if applicable). The current standard management and performance fees for the Dalton Japan Long Only strategy are 1.00% and 20.00% per annum, respectively. Actual fees may differ due to various factors including, but not limited to, account size. Returns do not reflect the deduction of investment advisory fees. The Firm's investment advisory fees are described in Dalton Investments' Form ADV Part 2.

The deduction of the management and performance fees (and the compounding effect thereof over time) will reduce the performance results and, correspondingly, an account's return. For example if ¥100 million were invested and experienced a 10% compounded annual total return for ten years, its ending value without giving effect to the deduction of the management or performance fees would be ¥259,374,246. If a 1% annual management fee, calculated and deducted quarterly, and 20% performance fee, calculated and deducted annually, were applied for the 10 year period, the total return would be 7.1% and the ending value would be ¥199,121,463.

Performance shown prior to July 1999 represents the performance of an account (the "Ported Account") managed by James B. Rosenwald III ("Mr. Rosenwald") through a Dalton Investments affiliated adviser (the "Ported Performance"). The investment management agreement for the Ported Account was transferred to Dalton Investments upon the firm's inception. The Ported Performance is linked to the Composite performance given that the strategy for Ported Performance account is substantially similar to the Composite's strategy. Mr. Rosenwald continues to be the primary portfolio manager.
Internal dispersion is calculated using the equal weighted standard deviation of the gross annual returns of all portfolio accounts included in the Composite for the entire year. Dispersion is not presented for periods less than one year or when there were five or fewer portfolios in the composite for the entire year as it is not considered statistically meaningful.
The three-year annualized standard deviation which uses gross annual returns measures the variability of the Composite and the Benchmark returns over the preceding 36-month period. The standard deviation is not presented for 1996 through 1998 as three years of data was not available at that point.
GIPS® is a registered trademark of CFA Institute. CFA Institute does not endorse or promote this organization, nor does it warrant the accuracy or quality of the content contained herein.

Past performance does not guarantee future results. All investments involve risk including the loss of principal.

159

ANNEX

AIFM DIRECTIVE DISCLOSURES

AIFM Directive disclosures

The Company is an externally managed alternative investment fund and has appointed International Fund Management Limited as its AIFM. Set out below is the information required to be disclosed in accordance with Article 23 of the UK AIFM Directive:

Investment strategy and objective of the AIF

The investment objective of the Company is to provide Shareholders with attractive capital growth through the active management of a highly concentrated portfolio of shares in quoted companies which have the majority of their operations in, or revenue derived from Japan which have been identified by the Investment Adviser as being undervalued and where (i) cash constitutes a significant proportion of the investee company's market capitalisation; and (ii) the relevant company has no controlling or majority shareholders.

Information on where any master AIF is established

Not applicable.

If the AIF is a fund of funds, the domicile of investee funds

Not applicable.

The type of assets in which the AIF may invest

The Company will invest in a highly concentrated portfolio of shares issued by quoted companies which have the majority of their operations in, or revenue derived from, Japan. The Company may also invest in unquoted companies and the Company may become invested in unquoted companies as a result of corporate actions or commercial transactions undertaken by quoted companies. The Company will only make an investment in an unquoted company if the aggregate interest of the Company in unquoted companies at the time of such investment is not more than 10 per cent. of the Net Asset Value of the Company at that time.

Investment techniques that may be employed by the AIF and all associated risks

Please see the headings titled "Investment Objective and Policy" and "Investment Strategy" in Part 6 (Information on the Company) of this Prospectus. Further please see the heading titled Risks Relating to the Company in Part 1 (Risk Factors) of this Prospectus.

Investment restrictions

Please see the heading titled "Investment restrictions" in Part 6 (Information on the Company) of this Prospectus.

Circumstances in which the AIF may use leverage, the types and sources of leverage permitted and the associated risks, any restrictions on the use of leverage and the maximum level of leverage which the AIFM is entitled to employ on behalf of the AIF

Please see the heading titled "Gearing Policy" in Part 6 (Information on the Company) of this Prospectus.

Any collateral and asset reuse arrangements

Not applicable.

Procedures by which the AIF may change its investment strategy or investment policy or both

Please see the heading titled "Amendment to the investment policy" in Part 6 (Information on the Company) of this Prospectus.

160

The main implications of the contractual relationship entered into for the purpose of investment including information on jurisdiction, the applicable law and on the existence (or not) of any legal instruments providing for the recognition and enforcement of judgments in the territory where the AIF is established.

The Company is a public company limited by shares, incorporated in England and Wales. While investors acquire an interest in the Company on subscribing for or purchasing Shares, the Company is the sole legal and/or beneficial owner of its investments. Consequently, Shareholders have no direct legal or beneficial interest in those investments. The liability of Shareholders for the debts and other obligations of the Company is limited to the amount unpaid, if any, on the Shares held by them. Shareholders' rights in respect of their investment in the Company are governed by the Articles of Association and the Act. Under English law, the following types of claims may in certain circumstances be brought against a company by its shareholders: contractual claims under its articles of association; claims in misrepresentation in respect of statements made in its prospectus and other marketing documents; unfair prejudice claims and derivative actions. In the event that a Shareholder considers that it may have a claim against the Company in connection with such investment in the Company, such Shareholder should consult its own legal advisers.

Jurisdiction and applicable law

Shareholders' rights are governed principally by the Articles of Association and the Act. By subscribing for the Shares, investors agree to be bound by the Articles of Association which are governed by, and construed in accordance with, the laws of England and Wales.

Recognition and enforcement of foreign judgments

Regulation (EC) 593/2008 ("Rome I") must be applied in all member states of the European Union (other than Denmark). Accordingly, where a matter comes before the courts of the relevant member state, the choice of governing law in any given agreement is subject to the provisions of Rome I. Under Rome I, the member state's court may apply any rule of that member state's own law which is mandatory irrespective of the governing law and may refuse to apply a rule of governing law if it is manifestly incompatible with the public policy of that member state. Further, where all other elements relevant to the situation at the time of the choice are located in a country other than the country whose law has been chosen, the choice of the parties shall not prejudice the application of provisions of the law of that country which cannot be derogated from by agreement. The United Kingdom has legislated to the effect that, immediately upon the conclusion of the Brexit transition period (i.e. 31 December 2020), the rules in Rome I were incorporated into domestic law. As a result, English choice of law clauses in contracts continue to be respected both in the UK and the EU member states.

Under the terms of the Withdrawal Agreement between the UK and the EU, a foreign judgment obtained in an EU member state relating to proceedings commenced prior to the expiry of the Brexit transition period (i.e. 31 December 2020) may be recognised and enforced in England pursuant to Council Regulation (EC) 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters. The position is the same in respect of a judgment which has been certified as a European Enforcement Order pursuant to Regulation (EC) 805/2004, so long as the relevant proceedings were commenced prior to the expiry of the Brexit transition period.

The identity of the AIFM, auditor and other service providers together with a description of their duties and the investors' rights

Alternative Investment Fund Manager

International Fund Management Limited has been appointed to act as the alternative investment fund manager of the Company in compliance with the provisions of the AIFM Directive.

Investment Adviser

Rising Sun Management Ltd. has been appointed by the Company to provide certain advisory services to the Company and the AIFM in respect of the Portfolio.

Registrar

Computershare Investor Services PLC has been appointed as registrar to the Company in respect of the transfer and settlement of Shares held in certificated and uncertificated form.

161

162

Administrator

PraxisIFM Fund Services (UK) Limited has been appointed as administrator to the Company. The Administrator provides the day-to-day administration of the Company and is also responsible for the Company's general administrative functions, such as calculation and publication of the Net Asset Value and maintenance of the Company's accounting and statutory records. The Administrator is responsible for calculating the Net Asset Value of the Ordinary Shares in consultation with the AIFM and Rising Sun and reporting this to the Board.

Company Secretary

PraxisIFM Fund Services (UK) Limited has also been appointed as Company Secretary to the Company. The Company Secretary will provide company secretarial services and a registered office to the Company.

Custodian

The Northern Trust Company has been appointed by the Company to act as custodian of certain assets and to provide certain services as a custodian.

Auditor

BDO LLP has been appointed by the Company as its statutory auditor.

Since the service providers are engaged by the Company, investors will have no direct right to enforce any rights against any of the service providers.

Management of professional liability risk

The provisions of the UK AIFM Directive concerning professional indemnity insurance or additional own funds to cover professional negligence risk do not apply to the AIFM. Nevertheless, the AIFM has the benefit of professional indemnity and directors' and officers' liabilities insurance coverage.

Delegated management function

The Company has delegated responsibility for day-to-day management of the investments comprised in the Company's portfolio to the AIFM (which has in turn delegated portfolio management activities to the Investment Adviser). The Directors have responsibility for exercising supervision of the AIFM and the Investment Adviser.

The Company's valuation procedure and pricing methodology

Please see the heading titled "Net Asset Value" in Part 6 (Information on the Company) of this Prospectus.

The Company's liquidity risk management, including redemption rights and redemption arrangements

Please see the headings titled "Discount Management Provisions" in Part 1 (Risk Factors) and "The Articles of Association" in Part 14 (General Information) of this Prospectus. The Ordinary Shares are not redeemable.

Fees, charges and expenses, which are directly or indirectly borne by investors

Please see the heading titled "Fees and Expenses" in Part 7 (Directors, Management and Administration) of this Prospectus.

Fair and preferential treatment of investors

The AIFM ensures that investors are treated fairly in a number of ways, including by ensuring that any preferential treatment granted by the AIFM to one or more investors does not result in an overall material disadvantage to the other investors by: (i) ensuring that its decision-making procedures are applied fairly as between investors; (ii) applying relevant policies and procedures properly; (iii) ensuring, to the extent within its power, that investors do not bear directly or indirectly fees, charges and expenses which are inappropriate in nature or amount; (iv) complying with the rules and guidance of the GFSC (or equivalent) applicable to it; and (v) conducting its activities honestly, fairly and with due skill, care and diligence.

The Company's latest net asset value or latest market price of its share

The Company's Net Asset Value is published daily by way of an RIS announcement.

163

The Company's historical performance

The Company's historical performance data, including the Company's annual and interim reports are available on the Company's website.

The Company's prime brokerage firm together with a description of any material arrangements of the AIF with its prime brokerage firm and the way any conflicts of interest are managed, the provision in the contract with the depository on the possibility of transfer and reuse of AIF assets, and information about any transfer of liability to the prime brokerage firm that may exist

J.P. Morgan Securities plc has been appointed as the Company's prime broker. Please see the heading titled "Prime Brokerage Agreement" in Part 14 (General Information) for a description of the Company's arrangements with the Prime Broker. The Company does not consider that any conflicts of interest arise from the appointment of the Prime Broker. The Prime Broker manages conflicts of interest in accordance with its conflicts of interest policy which has been prepared in accordance with all applicable regulation (including MiFID).

The Company's annual report, and periodic disclosure requirements

The information required to be disclosed under paragraphs 3.2.5 and 3.2.6 of the FUND sourcebook within the FCA Handbook is and will be disclosed in the Company's audited annual report.

sterling 175401



---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---



---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

AI assistant

NIPPON ACTIVE VALUE FUND PLC — Capital/Financing Update 2021

5034_rns_2021-11-05_bdc2fe1f-b945-4808-bb1a-d1120db85b98.pdf

NIPPON ACTIVE VALUE FUND PLC

Intermediaries Offer

Overseas Shareholders

CONTENTS

PROSPECTUS REGULATION SUMMARY

INTRODUCTION AND WARNINGS

Subsequent resale of securities or final placement securities through financial intermediaries

KEY INFORMATION ON THE ISSUER

Who is the issuer of the securities?

What is the key financial information regarding the issuer?

Additional information

Income statement

Balance sheet

What are the key risks that are specific to the issuer?

KEY INFORMATION ON THE SECURITIES

What are the main features of the securities?

Description of securities

Issued share capital

Rights attaching to the Ordinary Shares

Rights attaching to the C Shares

Restrictions on the free transferability of the Shares

Dividend policy

Where will the securities be traded?

What are the key risks that are specific to the securities?

Dilution

Expenses

Why is this prospectus being produced?

Conflicts of Interest

PART 1

RISK FACTORS

RISKS RELATING TO THE COMPANY

Investor returns will be dependent upon the performance of the Portfolio and the Company may experience fluctuations in operating results

Delays in deployment of the proceeds of the Issue

Investment opportunities

Duration

Discount management provisions

Distributions and dividend policy

Certain interests could give rise to a potential conflict between the interests of the Company and those of certain officers and advisers to the Company

Risks associated with the effects of the Coronavirus Disease 2019 (COVID-19) pandemic

RISKS RELATING TO RISING SUN

The departure of some or all of Rising Sun investment professionals could prevent the Company from achieving its investment objective

The Company is reliant on the investment record of the Rising Sun Management Team who may not be able to implement the investment policy on behalf of the Company

There can be no assurance that the Directors will be able to find a replacement investment adviser if Rising Sun resigns

The Company may be required to make payments to the Investment Adviser under indemnities in the Investment Advisory Agreement

Rising Sun has engaged an external provider of investment research services which it may not be able to replace if the engagement is terminated

Rising Sun and its affiliates and/or Dalton Advisory KK may provide services to other clients which could compete directly or indirectly with the activities of the Company and may be subject to conflicts of interest in respect of its activities on behalf of the Company

Reliance on Rising Sun's due diligence and investment processes

RISKS RELATING TO THE INVESTMENT STRATEGY

Risk associated with pursuing an activist shareholder strategy in Japan

The Company may not be able to pursue its investment strategy or achieve its investment objective

Risk associated with investing in a single country

Risks associated with investments in Japan

The Company does not expect to control companies in its Portfolio and cannot therefore ensure that they do not make decisions that decrease the returns to the Company from that investment

Sectoral diversification

The Portfolio may include unquoted investments

Borrowings

Derivative instruments

Other risks relating to the Portfolio and investment strategy

Risks relating to the C Shares

PART 2

IMPORTANT INFORMATION

1. Regulatory information

2. Intermediaries Offer

3. Investment considerations

4. Forward Looking Statements

5. Presentation of financial information

6. Presentation of industry, market and other data

7. Currency presentation

8. Restrictions on distribution

9. Information to distributors

10. UK PRIIPs Regulation

11. Taxation

12. Overseas investors

13. Compulsory transfer provisions

14. International tax regimes, FATCA, and other tax information reporting and exchange regimes

15. Investor profile

16. Data Protection

NIPPON ACTIVE VALUE FUND PLC Capital/Financing Update 2021



---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---

---	---	---	---	---